Flags for sale: An empirical assessment of flag of convenience desirability to foreign vessels

Illegal, unreported and unregulated (IUU) fishing costs the global economy tens of billions of US dollars annually, although accurate estimates of the current extent of this activity remain uncertain. Those that break or avoid fisheries management rules often employ tactics, such as registering their vessels under foreign flags (commonly known as "flags of convenience" (FoCs)), to carry out their often illegal activities. The practice of using FoCs by fishing vessels impedes prevention efforts to effectively deter or eliminate IUU fishing. While literature has proposed a large number of factors explaining why certain flags are more desirable than others, an empirical assessment of these proposed factors has not yet been made. This research, therefore, fills this gap by empirically evaluating 38 such factors. Results show that desirable flags are flags of countries that are largely non-cooperative with international efforts to sustainably manage shared fish stocks and prevent IUU fishing, regardless of their ratification of major international agreements. The same flags are easy to acquire and allow fishing vessels access to a large number of countries' exclusive economic zones and areas managed by regional fisheries management organizations. Policy implications are discussed in light of these findings.