Vessels fishing under a group quota are regulated by stopping the fishery when the group quota has been taken. In fisheries regulated by maximum vessel quotas, it is easier to ensure that the catch stays below the TAC. The derby effect becomes increasingly forceful, however, when the quota allocations are decreased. In 1990 and 1991, when the TAC for Arcto-Norwegian cod was extremely small, most of the coastal vessels fishing this stock were put under an IVQ regime.

The allocation of annual quotas in the purse seine fishery is regressive; that is, the largest vessels get a proportionally smaller quota than the small vessels. The philosophy behind this is equalization of incomes; there are economies of scale in the purse seine fleet, and larger vessels would obtain a proportionally higher catch value than smaller vessels if all could be used to their full capacity. The formula is determined by the Ministry of Fisheries after consultation with the industry.

Individual quota programs for the commercial fisheries of western Canada include one established in 1990 for the longline and pot fishery for sablefish; another established in 1991 for the longline fishery for Pacific halibut; and a third established in 1996 for the trawl fishery for groundfish. These IVQ programs are coupled with a variety of additional fishery management measures including limited entry, vessel size limits, gear restrictions, time and area closures, and marine reserves. Prior to IVQ implementation these fisheries used limited entry and were considered to be overcapitalized. Improvement in economic efficiency of the fishing fleet was one of the key reasons for adopting IVQs, from both the industry and the government perspective, and the programs resulted in major reductions in the size of the fleets and the numbers of crew members.

The government and industry in western Canada adopted IVQ programs after having considerable experience with other fishery management tools. The committee heard testimony that the limited entry programs in Pacific Canada had not been effective at limiting fishing effort; instead, the value of the license may have added economic incentives for license holders to fish even more intensely. In some fisheries, trip limits were used to slow down the legal catch but they did not stop the race for fish. Trip limits continued to decrease from one year to the next and resulted in considerable discarding, highgrading, and misreporting. A system of individual transferable effort quotas, which limited the number of fishing days, also failed to stop the race for fish. Instead, it resulted in significant overruns of TACs (>20%), which in turn led to shorter and shorter time allotments in subsequent years.