Cod are among the species protected in the Grand Banks
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Canada has produced evidence of what it says is illegal fishing just outside its waters by Portuguese trawlers.
Officials said one boat was found with protected fish on board, and that another had cut loose a net just before they boarded the vessel.
Fisheries officials say the net was was illegal, as its mesh was too small under international regulations.
The net was retrieved after a 30-hour search of the ocean floor in the Grand Banks area of the North Atlantic.
Canada's Department of Fisheries and Oceans said 65% of the fish found in the net were from species protected under a fishing moratorium "namely cod, American plaice and red fish".
'Serious infractions'
Fisheries and Oceans minister Geoff Regan said the net from the ship, the Brites,
"provides clear and tangible evidence of serious fishing
infractions".
The ministry showed pictures of the net and its catch on its website.
The ship's Portuguese captain says the net got stuck on the bottom of the ocean and broke off shortly before Canadian fisheries officers boarded the vessel.
The Canadians say the net was clearly cut.
But Portugal rejected the claims at the highest level.
"There were no irregularities," said foreign minister Teresa Gouveia.
The Brites was one of seven ships inspected last week just outside Canada's 200-mile waters.
Another vessel was cited for two violations, including fishing for banned species.
Enforcement
Within its waters, Canada has strictly enforced a fishing moratorium for cod and other endangered fish.
The BBC's Lee Carter says Canada has often protested to the European Union and the governments of Spain and Portugal that its vessels routinely break the rules in the North Atlantic.
Mr Regan said commercial fishing for cod and American plaice has been banned for a decade because stocks were so weak in the Grand Banks.
"I cannot stress enough the damage caused by foreign
overfishing," he said.
"These irresponsible actions have a harmful impact on the health
of fishery resources and the communities that rely on them here in
Canada and in other fishing nations."