Economic impacts of the European Union carding system on global fish trade

Due to the rise in illegal, unreported, and unregulated (IUU) fishing, the sustainable management of fishing resources is in jeopardy. The European Union (EU) is the first regional player to establish stringent guidelines to prevent, deter, and eliminate IUU fishing. The EU carding system administers the mandate for requiring a catch certificate. Using a system of yellow and red cards, countries that export fishery products to the EU are encouraged to lessen IUU fishing in their waters. The yellow card acts as a formal warning, whereas the red card results in an import ban. This study examines the impact of fishery exports to the EU under the carding system. Findings from the structural gravity models show that fishery exports from yellow- and red-carded countries to the EU fall by an average of 23% and 83%, respectively. The computed marginal effects suggest that the yellow and red cards be tariff equivalents of 5% and 43%, respectively. The IUU regulation, as a trade-restrictive technical measure, is an example of effective, legitimate efforts to combat IUU fishing and ensure sustainable fisheries worldwide.