Fish processing will not be impacted by FPI purchase

Tom Rideout, Minister of Fisheries and Aquaculture, today reiterated that fish processing in Newfoundland and Labrador will not be impacted by the purchase by FPI of the Seafood Company, a British shellfish processing entity.

Minister Rideout said, "There is no loss of jobs or work as a result of this acquisition. The shrimp will still be landed, cooked and peeled in this province. This was the case before the Seafood Company was acquired, and it continues to be the case.

"No unprocessed shrimp is being shipped to the United Kingdom from this province. All shrimp landed in Newfoundland and Labrador is cooked and peeled in this province, as per regulations under which FPI operates."

The minister added that licensing agreements exist between the province and FPI, and this is one of the regulations included in that agreement.

"Shrimp landed in Newfoundland and Labrador by vessels less than 65 feet is required to be cooked and peeled in a licensed processing plant in this province," continued the minister. "The leader of the Opposition should know this, as he is a former Minister of Fisheries and Aquaculture, and for two years signed licensing directives specifically outlining this fact."

Minister Rideout went on to say that FPI�s acquisition of the Seafood Company will enable FPI to better compete in international markets.

"FPI�s operation in the United Kingdom is beneficial to Newfoundland and Labrador, as it gives FPI improved access to the European market," said the minister. "The unreasonable 20 per cent tariff on product entering the United Kingdom places shrimp processors in this province at a substantial disadvantage, and better access to the British market is a vehicle upon which to sell shrimp being landed and processed in the province. The Government of Newfoundland and Labrador, since it does not have jurisdiction for international trade, has brought this issue to the attention of the federal International Trade Minister, as well as the federal Fisheries Minister. We are currently working with them to find a solution to this tariff issue.

"In order to market the shrimp in the United Kingdom," continued the minister, "FPI is attempting to take advantage of a six per cent tariff on product that will be required to be further processed on the European side. In this capacity, the shrimp industry in Newfoundland and Labrador has greater access to a market in which to sell the product at a much more desirable six per cent tariff, within the Autonomous Tariff Rate Quota of 7,000 tonnes. Furthermore, a market in the United Kingdom provides additional work to shrimp processors in Newfoundland and Labrador, who land, peel and cook the shrimp to be sold inside the United Kingdom, where further processing takes place."

Minister Rideout said, "We are not exporting unprocessed groundfish to the United Kingdom. Therefore, the Harbour Breton operation is not at all affected by the acquisition of the British company. The same is true for the operations in Marystown and Fortune. Similarly, we have not authorized the export of any other species of unprocessed fish to the United Kingdom, nor do we intend to."

The minister stressed that FPI�s recent acquisition will also not impact the processing of groundfish or other species in Newfoundland and Labrador.

Minister Rideout also provided comment on a potential inquiry into the financial operations of FPI.

"FPI is a publicly-traded company and therefore has control over its financial situation and operations," said Minister Rideout. "They are currently conducting an internal review of their operations, and therefore government must allow this to run its course before making a decision on whether or not an inquiry is necessary. As for the income trust transaction, this is not the current issue. This has been put on hold until a review of income trusts is completed by the federal government.

"The future of FPI is a top priority for government," continued the minister. "We will ensure that the best interests of the people of this province are served as discussions and decisions regarding FPI continue."

Media contact: Lori Lee Oates, ABC, Communications, (709) 729-3733, 690-8403

2005 11 23        9:55 a.m.