A huge Dutch super-trawler was Tuesday given the go-ahead to fish in Australian waters but with tough conditions to minimise by-catch such as dolphins, seals and sea lions.

The 9,500-tonne FV Margiris repelled Greenpeace protesters to dock at Port Lincoln in South Australia last Thursday for re-flagging as an Australian vessel before its proposed deployment to Tasmania for bait-fishing.

Environment Minister Tony Burke sought legal advice about whether he could intervene over concerns that dolphins and other marine life would inadvertently get swept up in its huge nets.

But he said he had been told he does not have the power to block it fishing in Australian waters.

"Under national environmental law I don't have the power to block it altogether," he told ABC television, but said the trawler's operators would have to prove they were doing everything necessary to minimise by-catch.

"What I do have is the legal power to impose a number of restrictions on it based on the impact it can have, not on the fish that it's targeting, but on the by-catch -- the seals, the dolphins, the fish that are protected and listed and I have responsibility for," Burke said.

"The big vessel will have to fish within the rules so that the impact it has on the environment is no more than if it was fishing on a small vessel," he added.

Under conditions imposed by the government, fishing will have to be suspended if a dolphin dies in the ship's nets or if three or more seals perish. It will also be banned from sea lion hunting grounds.

The trawler will also be required to have an observer on board and to record its activities on an underwater camera.

The 143-metre (469-foot) Margiris sparked protests among conservation groups and local fishermen when it was announced earlier this year that it would fish off Tasmania.

The Tasmanian businessman behind the Margiris venture said the restrictions were acceptable, and workable.

"I think what he's suggesting sounds reasonable, and we'll certainly study those conditions very closely," Seafish Tasmania director Gerry Geen told the broadcaster.

"But on the face of it I think that they're the sort of measures that will help us to reduce by-catch down to a very low level and we'll be very pleased to go along with them."

The Australian Fisheries Management Authority has dismissed concerns about over-fishing, saying the trawler would be allowed to catch just 10 percent of available fish and would have little if any impact on the broader eco-system.