Sanford managing director Eric Barratt says his company respects the decision to ban foreign-flagged fishing vessels from New Zealand waters, but the firm now faces extra costs.

Due to safety, labour and fishing practice concerns foreign-flagged boats will no longer be able to legally fish this country's waters in four years' time.

The Government's move follows a ministerial inquiry into foreign charter vessels, sparked by the deadly sinking of the South Korean-flagged Oyang 70 off the Otago coast in 2010 and allegations of physical and sexual abuse on the Oyang 75, another South Korean vessel.

Labour Minister Kate Wilkinson said such vessels will have to be reflagged to New Zealand following the four-year transition period. That means the full range of local law, including employment relations and workplace health and safety, will apply, she said.


Out of the roughly 25 boats operated by Sanford, Barratt said four were foreign-flagged charter vessels. Shares in the Auckland-based company dropped 5c to close at $4.05 last night.

Barratt said Sanford could acquire its own vessels instead of reflagging foreign charter boats. He said it was too early to give details on the costs involved.

Barratt said using foreign-flagged vessels improved market access into some countries, such as South Korea, where import tariffs were higher on fish caught on New Zealand-flagged boats.

"If we can achieve some kind of market access arrangements for New Zealand-flagged vessels that would be a significant advantage."

Ngahiwi Tomoana, the former chairman of Te Ohu Kaimoana, the governing body of iwi-owned Aotearoa Fisheries, said reflagging could see Maori going back to the Government for compensation if commercial returns decreased.

Sealord chief executive Graham Stuart, whose company uses three foreign charter vessels, welcomed the move.

- Additional reporting: Yvonne Tahana