By Doug Palmer
WASHINGTON (Reuters) - A U.S. proposal to revamp its dolphin-safe tuna label rules to comply with a trade case won by Mexico is drawing praise from conservationists and criticism from Mexico's fishing industry, which says it will keep their exports out of the U.S. market.
A World Trade Organization appellate panel ruled last year the two-decade-old labeling program was "not even-handed" because it focused on the use of large purse seine nets in the eastern tropical Pacific to catch tuna, and failed to address the risk of dolphin deaths from other fishing methods.
The United States has until July 13 to notify the WTO how it intends to comply with the May 2012 decision.
Rather than relax labeling rules for the eastern tropical Pacific, where the Mexican fishing industry operates, the National Oceanic and Atmospheric Administration on Friday proposed expanding the scope of the rules to include additional fisheries and tuna fishing techniques.
It would require canned tuna sold in the United States with a dolphin-safe label be certified by ship captains, and potentially observers, regardless of how or where it was caught.
That falls short of the U.S. market opening that Mexican fishermen hoped to achieve from the case.
"It's a nice thought, but it doesn't really have any teeth and it doesn't change the current state of affairs," which keeps most Mexican tuna fisherman from selling their product in the United States, Mark Robertson, a lawyer for Mexico's tuna industry, said in an interview.
The proposal would allow captains outside the eastern tropical Pacific region to essentially self-certify that no dolphins were killed or seriously harmed, contrasting with the elaborate observation, verification and tracking system in Mexico's fishing grounds, Robertson said.
"It's a whole regime of captain and crew training, equipment standards, restrictions on fishing" and other requirements and practices to minimize dolphin deaths, he said.
Mexico has been battling the U.S. dolphin safe labeling for 20 years. Its tuna industry employs more than 10,000 people and generated $112 million in 2011.
A Mexican official, speaking on condition he not be identified, said Mexico was reviewing NOAA's proposal.
"All our options remain on the table," he added, when asked about previous statements that Mexico could pursue trade sanctions against the United States in the case.
NOAA officials acknowledge that observation programs in other fisheries are not as comprehensive as in the eastern tropical Pacific, where all catches are observed.
"The United States is not prepared to demand worldwide that every single tuna vessel have an observer, said Kevin Chu, deputy regional administrator of NOAA's southwest fisheries office. But where observers are present, they also will be required to certify the catch under the new rules, he said.
The dispute revolved around the fact that yellowfin tuna swim with dolphins in the eastern tropical Pacific.
Fishermen began exploiting that relationship in the 1950s by using large purse seine nets to capture the tuna swimming beneath the dolphin herds.
The Southwest Fisheries Science Center, a division of NOAA, estimates as many 700,000 dolphins were killed annually by the practice in the late 1960s and total an estimated 6 million over the past 60 years.
Since then, "observed" fishing-related dolphin deaths in the eastern tropical Pacific have fallen to about 1,000 per year due to international conservation efforts that included putting observers on ships to record each tuna catch.
But tuna caught with the purse seine net technique - which involves using speed boats to chase the dolphins and herd them into small groups - cannot qualify for the dolphin-safe label under U.S. rules.
"The speed boats go out toward the dolphin herds and chase the dolphins until they are exhausted. A lot of the baby dolphins are left behind. They either starve to death or are eaten by predators," said Mark Palmer, an associate director at the Earth Island Institute.
The conservation group, which works with StarKist, The Chicken of the Sea and Bumble Bee Foods to certify tuna is dolphin safe, said the proposed changes would frustrate Mexico's attempt to weaken the program.
Conservationists also worry about the longer-term impact of stress on the dolphins, which potentially could be chased, caught and released several times in their lives.
U.S. trade officials said they were confident that NOAA's proposal would stand up to WTO scrutiny but added that they remained open to further talks with Mexico on the issue.
NOAA's plan is open for public comment until May 6, after which it will strive to issue a final rule by July 12, said Bill Jacobsen, an official in NOAA's southwest fisheries office in charge of crafting the proposal.
(Reporting by Doug Palmer; Editing by Tim Ahmann and Paul Simao)