"An Act relating to commercial fishing permit brokers; and providing for an effective date."

In Alaska, the commercial fishing community buys and sells their permits and quota shares on the open market. Due to the complexity, time involved, and the far-flung nature of the industry, the services of a professional broker is employed. Permit brokers act as agents in the sale and purchase of permits and quota shares. While their numbers are small, brokers transact a significant amount of business. In 2001, 13 brokering agents handled nearly half of 1,002 permanent permit transfers.

Surprisingly, there is no statutory regulation of brokering practices in Alaska beyond that of obtaining an Alaskan business license. Nonresident brokers don't even need that unless they establish locations in Alaska.

By requiring licensing and a bond established through the Department of Community & Economic Development, the state takes a modest measure to regulate the brokering practices of this business ~ it requires an actionable bond. The unethical activity most commonly cited is the improper use of the client trust fund. HB 22 requires some security for the client, that if a loss occurs, the injured party may make a claim to the Division of Occupational Licensing against the bond.

While a bond amount of $50,000 is not enough to cover the losses suffered by the clients of Northern Enterprises Permit and Boat Brokerage, it is start.

Last Updated: 02/01/2003

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