RCG ECON in collaboration with NISEA (Italy) recently organized the Intersessional subgroup Regional comparisons and sharing of knowhow for the evaluation of tangible and intangible capital values workshop. The two-day online event was held on March 13th-14th, 2023, and was attended by 32 experts from 15 Member States, as well as representatives from JRC and DG MARE. The workshop was chaired by Monica Gambino and Loretta Malvarosa.
The objective of the workshop was to deeper investigate and compare methods used for estimation of tangible and intangible capital assets and investments in the different national fishery data collections contexts. For that purpose, a consultation has been launched on to all European National correspondents. The feedback and results from this survey was presented to the group. Eighteen member states provided feedback. Progress and best practices from some MS have been also presented.
The workshop focused on three main topics (TORS):
1. Methods of collection and estimations details on the price of fishing value
2. Methods of collection and estimations of investments
3. Valuation of intangible assets and main issues encountered in the use of the related guidelines
With reference to the TOR 1, eleven countries declared to apply the PIM. MSs not implementing PIM consider the method too complex and not realistic as it overestimates the values compared to data collected from accounting data, or other administrative sources. The group recalled the need that, regardless the estimation methods used, the value of physical capital should be in line with its definition (Depreciated replacement value of the vessel including on-board equipment with a useful lifetime of more than one year). The group also recognized that still many differences exist among MS in the estimation of the Price per capacity unit and for this reason surveys to estimate the refence prices and other PIM assumptions should be regularly carried out. It would be advisable that a detailed description of PIM assumptions, by fleet segments, would be reported in the methodological annex of the National Work Plans as well details on the alternative methods of estimation of the value of physical capital.
Concerning TOR 2, from the survey it emerged that only one MS currently estimates investments through PIM. The group concluded that although investments derived from PIM are timely and easy to calculate they don’t reflect net investment as currently defined (gross investments minus sales of vessel or other equipment). The group recognised that further analyses are needed by cross-checking time series of investments, capital value and repair & maintenance costs. The group also recommended more analyses and surveys on the services lives of assets as well to collect more details on the composition of the “other equipment” group of assets (which is deemed to include very different types of assets) in order to better tailor PIM assumptions to the real cycles of capital of a vessel and MS accounting.
Concerning TOR 3 results from survey highlighted that the majority of the MS did not apply the guidelines. Six MS applied the guidelines and experienced various issues. For this reason, MS involvement in the application of the methods needs to be increased in the coming years. As the value of the fishing rights is a politically sensitive issue, this might prevent certain MS to get involved in this type of estimation. Therefore, it might be useful to allow MS to combine both values into the total value of assets or use other indicators valuing the assets (both tangible and intangible) in the coming years to gain more experience with the methods and enable the discussion on potential indicators.