State v Hung Kuo Hui [2006] FJHC 113; HAC40.2004 (24 February 2006)

IN THE HIGH COURT OF FIJI
AT SUVA
CRIMINAL JURISDICTION

CRIMINAL CASE NO.: HAC 40 OF 2004

BETWEEN

STATE
Applicant

AND

1. HUNG KUO HUI
2. WAIKAVA MARINE INDUSTRIES LIMITED
Defendant

Counsel: Ms Lidise - for State
Mr. T. Fa - for Defendant

Date of Hearing: 24^th January to 22nd February, 2006
Date of Sentencing: 24^th February, 2006

SENTENCING

Waikava Marine Industries Limited was the charterer of a Taiwan owned, Belize registered, fishing vessel, the Lian Chi Sheng. During the months of March, April and May of 2004 without a license or ministerial approval the Lian fished illegally inside Fiji's archipelagic waters and territorial seas.

The company was convicted, with the unanimous assistance of the assessors, of two representative counts under Sections 5(3) and 10(3) of the Fisheries Act.

The maximum available penalty in respect of each count is a fine of $100,000.00.

The State seek forfeiture of the Lian including all her apparatus and any proceeds of sale of provisions, fuel and cargo to an estimated value of $500,000.00.

Background

Waikava Marine Industries Limited ("Waikava") is a Fijian family owned and operated company belonging to its shareholders Mr. and Mrs. Ledua.

Mr. Ledua represented the company throughout the trial. He has an impressive 23 year record in commercial fishing. He has studied and or worked not only in Fiji but China, Scotland, Australia and New Caledonia. He was at one time a Fijian Fisheries Off ice r.

In April 2043 Waikava entered into a charter agreement with the ship's owners for the exclusive use of the ship predominantly in Fiji's fisheries waters.

Like all States that have ratified the UN Convention on the Law of the Sea (UNCLOS) Fiji extends its sovereignty beyond its land territory and internal waterways over its archipelagic waters and territorial seas and through to the outer border of her exclusive economic zone.

These areas are described by the Marine Spaces Act, Cap. 158A, Sections 3-6 and include:

1. Internal waters. Generally the internal water ways and harbours of Fiji's land mass. (Not relevant to this case).

2. Archipelagic waters. Generally all the immediately surrounding seas within and about Fiji's Islands and greater reef system.

3. Territorial seas. Generally all sea space out from Fiji's archipelagic waters for 12 nautical miles.

4. The Exclusive Economic Zone. Generally all sea space extending for 188 nautical miles from the border of the territorial seas (although measured from the archipelagic baseline for 200 nautical miles).

Within these separate Marine Spaces the Fisheries Act regulates all fishing activity. In short form you must have a license or ministerial approval to fish within each of those spaces. If you don't have 5L1CIa a license or ministerial approval you cannot legally take fish from that particular marine space.

In 2003 the ship and her charterers held air offshore license to fish inside Fiji's archipelagic waters and territorial seas. In December of that year when the license expired it could not be renewed as the Government policy had changed. Instead of an offshore license the ship was only issued with a license to fish Fiji's Exclusive Economic Zone. In breach of that license the ship put to sea and almost exclusively fished archipelagic waters and territorial seas during March, April and May of 2004.

Fiji's fisheries resources are precious. In an effort to manage the resource wisely Fiji has joined other Pacific Islands in the Forum Fishing Agency. This multi lateral treaty requires any foreign ship using our seas for harvesting fish to carry onboard an automatic location communicator. The ALC reports on ship activity via satellite through a vessel monitoring system hub to various national operators.

The VMS operator in Fiji was able to ascertain that the Lian had been fishing illegally. In April 2004 he twice warned Waikava about these infringements. The charterer and the Chip appear to have ignored those warnings.

Prosecution exhibit 20 is a series of charts that blotted the track of the Lian as she slowly mooched around Fijian waters long lining at will. Such was the concern of the Fisheries Protection Officers that the warship Kikau was despatched to intercept the Lian. The Commanding; Officer and his crew using information from the VMS skilfully navigated Kikau on an intercept course with the Lian. She was found Fishing inside Fiji's territorial waters.

The Lian when discovered by the warship Kikau would not respond to visual or radio signals and tried to make a run for it. She steamed off trailing her long lines behind her. It was not until the warship went to action stations and manned her 50mm camion that the Lian thought better of trying to escape, hove to and vas boarded. Photographs were taken by the fisheries Protection Officers.

The photographs demonstrate that the Lian was in our waters for the purpose of fishing. She had a long line radio and marker buoy in the water trailing behind her; fishing gear and baited hooks strewn amid ship's down aft and coiled baskets of fang line ready to be deployed. There was evidence of from catch. Photos show the Fisheries Protection Officer holding up a fresh shark fin, fresh shark fins were found neatly stacked in a freezer arid frozen shark fins were stacked in another space.

The Lian was supposed to be hunting tuna. It appears she was targeting the more lucrative shark for her valuable fins.

After fishing in Fiji throughout March and April the Lian had discharged a cargo of fish in Vanuatu. Its value is unknown. However once witness a Vanuatu Maritime policeman, reported the fish holds were full of shark, mahimahi, barracuda, marlin, tuna and tuna like species. The charier arrangement was for such valuable cargo to be sold in Fiji so the nation may gain same: benefit from the use of her natural fish resource.

After her arrest on May 19^th the Lian's meagre cargo was sold for $42,543.92. This accounts for only 14 days of fishing. It provides a scale against which the value of her cargo sold in Vanuatu can he estimated.

Sentencing

Earlier Sentencing decisions l have been referred to were for prosecutions under Section 16 of the Marine Spaces Act, The penalties reflect a tariff for illegal fishing in the vast exclusive economic zone of between $2,000.00 and $7,000,00 with a stalling point of around $6,000.00 (cf The State v Yang Shui Xing, Criminal Case No.: HAC 41 of 2004S, The State v Zhang Ban Chuan, Criminal Case No.: H AC 009 of 2003S and The State v Chen Chaolin, Criminal Case No.: HAC 010 of 2003S).

I emphasize that these cases were for offences under the Marine Spaces Act for unlicensed fishing in the exclusive economic zone and not as here in the archipelagic waters and territorial seas of Fiji within our backyard.

It appears that the lower end of that scale has been reserved for inadvertent or one off acts of illegal fishing (cf The State v Chin Chaolin, Criminal Appeal No.: HAC 010 of 2003S). Flagrant breaches such as that displayed in Xing (supra) see fines of $6,000.00 for repetitive illegal fishing over the EEZ boundary.

It has been observed even under the Marine Spaces Act that repetitive offenders who illegally fish for an extended period of time in Fiji waters must expect higher fines from the Court, Sharneem J in Gui (supra).

The essential difference between these Marine Space prosecutions and the sentence I must now pass on Waikava as charterer of the Lian is found in the fact that this ship was fishing in Fiji's archipelagic waters and territorial seas. In my mind there is a difference between the marine spaces described in the Act. The EEZ is vast. Strong management of fish resources within that zone is essential. However, it is not as critical as the need to manage fish stocks closer to home in the seas just off our reefs and island shores.

The sheer greed of striping out fish stocks that would otherwise be directly available for the livelihood and sustenance of island communities and indigenous fishing concerns must elevate the tariff range for these offences. The closer you fish to shore, the more culpable you are and the more you pay sums up the principle. My brother justice Coventry when sitting in the Solomon Islands High Court set out sentencing principles generally applicable to illegal fishing cases in Regina v Finete and CNF Fishing Limited, High Court Solomon Islands, 30 July, 1984:

"The fish within a country's fishing limits are part of that nations assets. They are the assets of a nation in the same way as mineral wealth, agricultural wealth and skills of her people. When a master and a company fish illegally they take the assets of that nation illegally... The motive is financial gain. The penalty must be severe accordingly".

Mr. Ledua I must now sentence your company as charterer. A Charter, in this instance, is a legal device used to legitimize fishing Ships owned in another State in national waters. Charterers are equally responsible with owners and operators for any breaches of Fijian Law. It is past time for charterers to recognise that arrangement with foreign Owners go beyond their mutual commercial convenience and extend to operational responsibility. It is this 'operational responsibility' that the Fisheries Act is seeking to describe in the offence provisions of Section 10(3). If you invite an overseas ship into your country to fish then you take responsibility to ensure she complies with the rules and does not exploit the privileges gained by that charter. As charterer of the Lian, Mr. Ledua your behaviour was inexcusable. You and your company have exploited this most valuable resource no doubt thinking the risk of being caught was minimal, or at best being careless of your obligations. Therein lies your culpability.

I find that an appropriate starting Point in respect of each representative, conviction to be $10,000.00.

Aggravating the offence are the fact that:

1. You are a principle shareholder in Waikava, You have a 23 year association with commercial fishing. You have degrees in marine biology and science. You were once a fisheries officer. You should have known better and directed your company so as to ensure the Lian complied with the law.

2. You know the license was only to fish the EEZ. Yet the offending was blatant. Exhibit 20 demonstrated that the Lian consistently fished inside Fiji's archipelagic waters and territorial seas sometimes within very close distance of our islands.

3. Your company was warned on two occasions that the Lian appeared to be fishing illegally.

4. As exclusive charterer of the Lian your company was incharge of its overall operations. You failed to ensure that these were carried out in accordance with the law.

5. The value of the catch sold after arrest was $42,600.00 for 14 days fishing between the 6^th and 20^th of May, 2004. The estimated value of the catch sold in Vanuatu is significantly more.

6. The charges are representative of a course of conduct over several weeks in March, April and May of 2004. This was repetitive blatant offending.

I add a further sum of $7,000.00 to the starting point for each offence taking the total to $17000.00 for each offence. I view the two convictions as relating to suite separate and discreet incidents. I must impose separate fines for each offence. The sentences must be cumulative. The total available penalty is therefore $34,000.00.

Against these aggravating feature I take into account:

1. The company's good record.

2. Its modest size, 12 employees, Fijian $1m in turnover and net assets of same $400,000.00.

3. The personal circumstances of the shareholders.

I accordingly allow a discount of $4,000.00 from the total sum of $34,000.00. 1 take into account the totality of these fines and find them to be fair for a company with significant shipping interests. The fine is also well in proportion with the estimated value of the Lian's cargo. In respect of each offence you are fined $15,000.00, the company is ordered to pay the sum of $30,000.00 by 15 monthly installments interest free of $2000.00 commencing with a first payment on the 31' of March, 2006 and monthly thereafter until the full amount is paid off.

Forfeiture

The discretionary power for forfeiture is provided under Section 10(7) of the Fisheries Act. The Court may order forfeiture of any vessel, apparatus, catch or proceeds of sale of catch from any vessel employed in the commission of an offence.

The Court of Appeal has recently expressed some views on forfeiture in China National Fisheries Corporation and Others v The State, Criminal Appeal No. AA00027 of 2005. At paragraph 27 their Lordships observed that the Fisheries Act and the Marine Spaces Act are properly interpreted to mean that the thing forfeited may belong to someone other than the convicted person. Indeed, the owner need not be made a respondent as there appears to be no basis upon which they could or should be added as a party in a criminal case unless they were charged. The Court was there echoing the reasoning of the Nigh Court of Australia in Cheatly v The Queen [1972] HCA 63; [1972] 127 CLR 291 (at 304 per Menzies J).

I, accordingly, find that I have jurisdiction to consider forfeiture of the fishing vessel Lian Chi Sheng, her apparatus, catch and proceeds of sale of any catch. I take Section 10(7) of the Act to include the confiscation of any seized provisions or fuel as I find they form part of the apparatus necessary to operate a fishing vessel for extended periods at sea. The principles for forfeiture can be derived from those described by my sister justice Shameem and subsequently approved by the Appeal Court in the China National Fisheries case (supra) and include:

1. Deliberate breaches of fisheries law will inexorably lead to forfeiture (Cheatly) supra.

2. Fines even heavy fines against individuals are insufficient since individuals may they not have the ability to pay or it may be difficult or impossible to follow their assets to another company or country. The real offender is usually the owner of the vessel who was often outside the jurisdiction where the illegal fishing occurred. Accordingly, except where there are special mitigating circumstances forfeiture is the only effective way to see that sovereignty is respected and the policies of fishing law are carried out (Chiu Yaou Fa v Morris Supreme Court Northern Territories [1987] 46 MTR 1).

3. Even where forfeiture would be an occasion of serious hardship and substantial economic lost this must be weighed against the need for substantial financial deterrence and the limited punishment involved in fines (R v Kakura and Sato [1990] 20 NSWR 638).

4. The power of forfeiture like the power to confiscate smuggled or contraband goods is a penal law and not within the ambit or purpose of any constitutional protection. Forfeiture is a necessary aspect of the sovereign right recognized in international law to wisely manage and protect fisheries resources (re Director of Public Prosecutions Ex parte Lawler [1994] 68 ALR HCA para. 23).

5. The proper course is to consider sentencing first then pass to consider forfeiture as a separate issue. Forfeiture is a penalty provision but it needs to be considered quite separately (China National Fisheries Corporation (supra) para. 41).

I find that the fishing in this case was not an isolated accidental breach caused by bad navigation. It was blatant fish piracy driven by greed. It is clear that Fiji through its Fisheries and Marine Spaces Acts is endeavouring to regulate this precious fishing resource by incorporating a most effective deterrent power, forfeiture.

Small under-resourced Pacific Islands states can only protect their most valuable marine resources from the considerable threats of exploitation by sending consistent and clear messages to owners, charterers, skippers and crew that conduct of this type if discovered is inexcusable, that penalties will be severe and that forfeiture for deliberate illegal fishing is inevitable. Nothing less would meet Fiji's duty to her own people. Nothing less would respect Fiji's commitment to her oceanic sisters.

In these days of reliable satellite global positioning systems, let alone the proficient use of a sextant and clock a captain, an owner and a charterer must know where a ship is at any point in time. They know their activities are constantly and automatically monitored. M, are long past free range harvesting of the sea key fish pirates.

Prosecutions under the Fisheries Act cars result in severe monetary penalties and forfeiture. However, in the context of the investment, the business and available profit from commercial Fishing these penalties are modest and well in proportion. The resource being protected is of great significance and value. Therefore, a sense of proportion dictates a high level of penalty and the inevitability of forfeiture.

Captains, charterers and owners must conduct themselves with care and prudence when harvesting our Pacific ocean. They are well warned. They are deemed to know the law. The burden of compliance is on them not on poor states that cannot police the pirates. There is a legitimate expectation that those engaged in foreign fleet fishing should take care to comply with the rules. There is a legitimate expectation that non-compliance will result in high penalties and forfeiture.

Accordingly, I order forfeiture of the fishing vessel the Lian Chi Sheng, her apparatus and proceeds of sale of any catch, provisions, or fuel to the State.

Gerard Winter
JUDGE

At Suva
24^th February, 2006