The controversial FV Abel Tasman super trawler will be banned from fishing in Australian waters for up to two years while further scientific assessments of its environmental impact are carried out.
And the federal government will carry out a ''root and branch review'' of fisheries management law in response to concerns about the 18,000-tonne fish quota given by fisheries authorities to the operator of the 142-metre, Dutch-owned ship.
Environment Minister Tony Burke and Fisheries Minister Joe Ludwig said in Canberra today that a precautionary approach would be taken over the super trawler - previously known as the FV Margiris - amid ''uncertainties'' about the impact it could have on protected species such as dolphins, seals and seabirds.
''If we get this wrong, there are risks to the environment, to commercial operators and to everyone who loves fishing and they are risks I am not prepared to take,'' Mr Burke said.
''There has never been a fishing vessel of this capacity in Australia before and the [Environment Protection and Biodiversity Conservation Act] needs to be updated so that it can deal with it.''
The super trawler is docked at Port Lincoln in South Australia and was poised to start fishing within days.
Its Australian operator, Seafish Tasmania, has not ruled out legal action against the government, saying it would have to let 50 staff members go.
Labor caucus this morning agreed to introduce a bill to extend Mr Burke's power under environmental law after the cabinet approved the measures last night. The new legislation will give the environment and fisheries ministers the power to intervene if they are concerned that a new fishing activity could damage the environment.
The law would apply not just to the Abel Tasman but to any super trawler or new kind of fishing activity introduced to Australian waters that raises sufficient concern for the ministers.
Mr Burke will introduce the bill later today. He will need the support of the independent MPs in the lower house.
The law will allow the ministers to establish an expert panel to examine all the potential environmental impacts of such super trawlers. The panel will report directly to the ministers. In the meantime, the trawler's operations could be prevented for up to two years.
Senator Ludwig also announced a ''root and branch review'' of the Fisheries Management Act.
''It's clear to me that after 20 years of operating that legislation, there is now community expectation about how we should continue to have the world's best-managed fisheries.''
Senator Ludwig had previously backed the Australian Fisheries Management Authority's 18,000-tonne quota for Seafish Tasmania. But he said today he had ''had an opportunity to go through the management powers that are available to me''.
''Like Minister Burke, I also have a degree of uncertainty about how this vessel would operate within these waters and the likely impact particularly on the environment but also the social and economic considerations,'' he said.
Gerry Geen, director of Seafish Tasmania, told the National Times that the company would have to lay off 50 Australian staff today. The company had hired 45 workers from Devonport for the on-board factory and another five for other crew positions.
''There are a lot of families going to be getting bad news today,'' he said.
Mr Geen said the company might take legal action against the government, but added ''we haven't got that far yet''.
He could not say what would happen to the ship immediately.
''We didn't have any contingency plans because we thought we were going to be fishing legally in Australian waters,'' he said.
Independent MPs Rob Oakeshott and Tony Windsor said they needed to see the bill before deciding whether they could support it.
Mr Oakeshott said he was not concerned about the size of the boat but rather the sustainability of the 18,000-tonne quota.
''If there is an issue ... that I would seek more detail on, it's the sustainability of the quota. As far as big things doing efficient jobs go, where do we stop? I'm not concerned about a big boat any more than I'm concerned about big tractors.''
Today, in a Coalition party room meeting, nine MPs spoke about the super trawler ahead of the government's announcement.
It is understood that three out of the group were against the FV Abel Tasman, with one MP calling it the "Woolworths of the sea".