SAN FRANCISCO >> Ivy Lai carries a small stock of dried shark fins in her crammed, single-aisle Chinatown seafood shop. Expensive price tags are scrawled on the fin bags, stowed carefully behind a locked glass case.

Shark fin sales represent only a sliver of Lai’s business, nestled in a bustling market district on Stockton Street. But she keeps the fins on hand for occasions such as weddings, banquets or business meetings, for which customers are willing to fork over as much as $600 a pound to serve shark fin soup, a delicacy that’s been treasured in Asian cultures since at least the 14th century Ming dynasty.

But a bill to outlaw shark fins now heading through California’s Legislature has threatened that custom and sparked a split in the Chinese-American community, pitting tradition against the environment.

The bill would force retail shops, restaurants and small processing plants to deplete their entire stock of shark fins by the end of 2012. Critics say thousands of California businesspeople will have to shutter their stores and fire employees if the bill becomes law.

Although the bill is sponsored by a Silicon Valley assemblyman of Chinese descent, opponents have accused the bill’s sponsors of discrimination against ethnic Chinese by targeting one of their cultural institutions.

The shark fin is gelatinous and nearly tasteless, but serving the soup is considered a sign of respect and status because it is such a luxurious meal, costing as much as $100 a bowl.

“Many years ago, it was seen as food for royalty,” Lai said through a translator. “It’s still expensive. But it is a gift. It is very important to the culture. When you get rid of it you are totally destroying a tradition.”

Assembly Bill 376 would prohibit the sale, purchase or possession of shark fins for all but licensed fishermen in California. The ban would take full effect on Jan. 1, 2013.

Alarmed by the drop in shark populations among more than 400 species around the globe, environmentalists are hoping to choke off the market for shark fins.

In 2009, the International Union for Conservation of nature estimated that 64 shark species were endangered or near-endangered.

Federal regulations already ban “finning” in U.S. waters, but inadequate policing has allowed the brutal trade to continue to flourish, critics of the practice say. With 73 million sharks dying a year, “at this rate, they’re going to go extinct in our lifetime,” said Assemblyman Paul Fong, D-Cupertino, who authored the legislation with Assemblyman Jared Huffman, D-San Rafael.

“If they do go extinct, the top predator would be removed from the food chain and that would throw the ocean’s ecosystem into a huge imbalance — and that will affect us all,” Fong said.

The bill was approved by the Assembly 65-8 and passed the Senate Appropriations Committee on a 5-2 vote on Thursday, sending it to the full Senate.

Though the bill has split the Asian Pacific Islander Legislative Caucus — with seven lawmakers in favor and four opposed — it has enough overall support to get through the Senate and onto Gov. Jerry Brown’s desk, Fong said.

Fong, who grew up in Sunnyvale, Calif., said he ate the soup as a child as part of his own family’s tradition. But recently, he became convinced it was an anachronism after watching a documentary showing how fishermen cut the fins off live sharks and throw the bloodied and maimed fish back in the ocean to die a slow death.

Fong said he is unmoved by those who accuse him of attacking a cultural institution.

“The Chinese culture,” he said, “used to promote foot binding on women.”

A statewide poll by the Monterey Bay Aquarium showed that more than two-thirds of California’s Chinese-Americans support a ban on finning. Shark fins have been banned in Hawaii, Washington and just this month in Oregon, and legislation to ban the possession and sale of shark fins has been introduced in China’s National Peoples Congress.

It is a growing sentiment among ethnic Chinese, particularly among the young, who are being raised with more conservation awareness, Fong said.

“I would hope sharks don’t go extinct,” said Edwin Chen, a 17-year old student at San Francisco’s Galileo High School. “People should just stop eating sharks.”

But a handwritten sign in Chinese characters posted above a long row of dried shark fins in another Chinatown seafood shop, Chung Chou City, reads in part: “AB 376 discriminates Asian descent. … Is it really that easy to bully Asian descent? It’s not reasonable.”

The problem with the legislation, opponents say, is that it targets only a small subset of shark consumers.

State Sen. Ted Lieu, D-Torrance, noted that killing sharks would remain legal, and Beverly Hills shoppers could buy their $440 sharkskin leather wallets, while others could continue ordering Mako shark steaks at restaurants.

“Clearly, the bill would have some effect on reducing shark consumption, but they’ve done it in a discriminatory way,” Lieu said. “The government shouldn’t say you can kill a shark for the cultural practice of skinning for wallets but you can’t use the same shark for shark fin soup.”

Tony Mak, who has run a one-person shark fin distribution company in San Francisco since 1995, disputed the data showing that shark populations are endangered.

“This business is highly monitored and managed by the federal government,” Mak said. “If they decide the shark population is in danger, the federal government would have shut down commercial fishing of sharks already. They don’t have evidence to show sharks are endangered. That’s why they don’t stop the production side and come to the consumer side to take away consumers’ rights.”

Critics of the bill also argue that it probably won’t end the tradition because it would just force it underground, with consumers forced to buy shark fins from unsavory dealers.

Up to $70 million in gross sales would be lost statewide, and at least twice that if you include the grounding of operations associated with the legal shark fin market, said Michael Kwong, whose family has been in the shark fin business since 1906. His shark fin processing plant in San Francisco would go under if the ban takes effect.

“I don’t want to say it’s a racial thing, but … “ said Kwong, leader of the Asian American Rights Committee of California, which hired Sacramento lobbying firm Sloat Higgins Jensen and Associates to fight the bill.

Fong, who has worked as a civil rights activist in the Asian Pacific Islander community, countered: “I understand racism, and this isn’t a racist act.”

He said that there is plenty of synthetic shark fin soup on the market. And though it would mean hosts would not be able to use the expensive broth as a status symbol at important gatherings, Fong said, “there are plenty of other ways to display your wealth.”

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A BILL TO BAN SHARK FINS

—Assembly Bill 376 would ban the possession, sale or distribution of shark fins.

—People holding a commercial fishing license would be exempted, but it would be illegal for restaurants and retail outlets to have the fins.

—Restaurants may possess and sell shark fins they purchased before Jan. 1, 2012 until Jan. 1, 2013.

—Violators would be guilty of a misdemeanor and face fines of between $100 and $1,000.

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BY THE NUMBERS

—Each year as many as 73 million sharks are killed worldwide for their fins.

—Dried shark fin can sell for as much as $600 a pound; shark fin soup runs as much as $100 a bowl.

—The annual U.S. market for shark fins is estimated at more than $1 billion.

—A 2003 study showed that hammerhead, white and thresher sharks in the Northwest Atlantic had declined 79-89 percent in just eight to 15 years; most other species declined by more than 50 percent.

Source: Legislative analysis of AB 376. (c)2011 the Contra Costa Times (Walnut Creek, Calif.)