HALIFAX -- A federal panel reviewing the northern shrimp quota off Newfoundland and Labrador has recommended scrapping a policy that protects the interests of the fishery's pioneers.

The independent panel was examining whether the Last-In, First-Out policy should be continued, modified or scrapped as shrimp stocks decline.

Under the current policy, the last entrants to a fishery are the first to leave when a quota is cut.

But in the panel's report released Tuesday, it said the policy does not allow the industry to adjust to changes in shrimp stocks.

The report recommends replacing the policy with an allocation regime that would include proportional shares in all shrimp fishing areas.

It said under its proposed policy, shrimp fishermen would receive a fixed percentage of shares in each fishing area.

Officials in Nova Scotia have argued against scrapping the policy.

Fisheries Minister Keith Colwell has said the northern shrimp fishery was actually developed several years ago by Nova Scotia's offshore fleet, which is worth $131 million to the province.

Colwell has said any drastic change to the rules would be unfair and would have a major impact on a fleet with a heavy investment in the fishery.

The fisheries union in Newfoundland and Labrador has said the policy could spell the end of the shrimp fishery in that province.

The Fish, Food and Allied Workers Union has said smaller inshore trawlers in the province are bearing almost all of the burden of cuts in the shrimp quota.