The International Chamber of Shipping (ICS) is calling upon EU maritime administrations to ensure that they are ready to issue passenger ships with the required insurance certificates in order that ships can comply with the EU Passenger Liability Regulation (PLR).

If the necessary certificates are not issued as required, by 31 December, then cruise ships and passenger ferries, including non-EU vessels, may be unable to trade within EU waters.

ICS Secretary General, Peter Hinchliffe explained: “In close co-operation with the International Group of P&I Clubs, passenger ship operators have gone to great lengths to ensure that they can meet the new insurance requirements, including the need to obtain cover for terrorism and war risks.  It is now essential that EU Member States are ready to issue the required certificates and do this using a common approach.”

Mr Hinchliffe added: “It is especially important that certification arrangements are in place for ships registered with non-EU flags, as well as for European ones”.

The EU Passenger Liability Regulation (PLR) broadly mirrors the 2002 Protocol to the IMO Athens Convention, although the IMO instrument has still not yet entered into force worldwide.

“The issues are complex,” said Mr Hinchliffe, “but the thorny issue of terrorism cover has hampered implementation of the IMO Protocol since IMO Member States first rejected industry arguments that terrorism is an attack on society at large and that the costs should be borne by governments.  Instead IMO decided that the provision of such cover should be left to the market”.

With respect to the new EU regulation that comes into effect at the end of the month, the need to obtain cover for terrorism has presented shipowners and their insurers with a real challenge.  The International Group of P&I Clubs has decided to issue certificates of insurance for the non-war risks arising under the EU PLR, and alternative arrangements have been developed for the terrorism component, namely insurance in the non-mutual commercial market arranged by Marsh/Willis or Safeguard.

Given the complication of having to have separate terrorism cover, the International Group and ICS have been trying to persuade governments to develop a common position with regard to port state acceptance of insurance certificates.  This is of vital importance if the Regulation is to come into effect on 31 December without causing disruption to the cruise ship and ferry industries and, even more importantly, to their passengers.

The International Chamber of Shipping (ICS), which represents over 80% of the world merchant fleet, has issued a new position paper on Arctic shipping. As the Arctic becomes more accessible, ICS has set out some key principles with regard to the future governance of Arctic waters.

Offshore support vessel activity is already significant, while destination shipping is anticipated to grow as the extraction of energy and raw materials is developed. Use of the Northern Sea Route is also a reality for a small but increasing number of ships in the summer months.

ICS therefore stresses the importance of Arctic nations respecting the United Nations Convention on the Law of the Sea (UNCLOS) and relevant IMO Conventions and Codes such as SOLAS and MARPOL.

ICS Director of External Relations, Simon Bennett explained: “As the volume of Arctic shipping gradually increases, there is a growing awareness about the need for a high degree of care when ships navigate Arctic waters. However, the proper forum for addressing these concerns is the International Maritime Organization, which is currently developing a Polar Code that is expected to be mandatory. It is most important that Arctic nations avoid unilateral measures that might cut across IMO Conventions or the provisions of UNCLOS.”

ICS stresses that individual coastal states should not impose discriminatory treatment that might prejudice the rights of ships registered with non-Arctic nations under international maritime law, such as unilateral ship construction, design and equipment standards.

ICS also identifies some issues that require clarification as Arctic waters become more accessible. For example, ICS believes that the UNCLOS regime of ‘transit passage’ for straits used for international navigation takes precedence over the rights of coastal states to enact unilateral measures against international shipping.

“Until recently this issue seemed rather academic, as did the question of nations using straight baselines to determine their territorial sea. But as remote Arctic sea routes become accessible these issues are becoming more important.” said Mr Bennett.

Amongst the intended audience for the ICS paper are high level policy makers in environment and foreign ministries who may not be regularly engaged in shipping issues.

However, the paper also outlines ICS’s approach towards the development of the IMO Polar Code, which is expected to be finalised next year.

“The development of the Polar Code needs to be risk and performance-based,” said Mr Bennett. “For example, pending the future development of unified requirements for the construction and operation of ‘ice-class’ ships, the Code should not arbitrarily require conformity with any particular ‘ice-class’ standards to the exclusion of others that deliver comparable performance.”

The paper also sets out ICS’s position with respect to the development of infrastructure to support safety and environmental protection, the need for full market access and freedom of navigation, transparency with respect to national regulation and the need for reduced bureaucracy and the setting of appropriate fees for services.

“If frequent and reliable international shipping services are to be provided between Arctic ports and the rest of the world, or natural resources in the region are to be developed in a manner that reconciles the need for both environmental and economic sustainably, this will require the provision of maritime services that are competitive and cost efficient,” said Mr Bennett.

The ICS position paper is being distributed via national shipowners’ associations to governments and other stakeholders, but can be downloaded at www.ics-shipping.org.

Representatives of the leading worldwide Associations of Shipbuilders, Classification Societies and Shipowners met in Busan, Korea for their annual Tripartite meeting hosted by the Korean Register of Shipping and KOSHIPA, the national shipbuilders association.

The meeting was united in expressing its serious concern with the obstacles that all three parties face as the Ballast Water Management Convention moves closer to ratification, eight years after its text was adopted.  It was always going to be challenging to fit ballast water treatment equipment to all of the world’s 70,000 ships.

New technologies needed to be explored and developed to treat the volume of water required by ocean going ships as ballast. However the slow pace of ratification by IMO member States has negated the carefully staged implementation programme that was a feature of the original Convention.  Now that the fixed timeline for implementation has passed without entry into force it means that, as soon as the Ballast Water Management Convention does meet its ratification criteria, thousands of ships will need to be fitted in a very short time.

Whilst strenuous efforts were made by industry, this will put unattainable demands on ship repair facilities, engineering capabilities and on the relatively small number of manufacturers that have developed suitable treatment equipment.

The meeting also expressed serious concerns about Type-Approval requirements. Having now gained some experience with the current requirements, Tripartite participants expressed the clear opinion that many serious shortcomings now need urgent attention. If nothing is done to address this situation, a very large number of treatment equipments costing billions of dollars may be required to be installed on ships with the prior knowledge that these systems may not always work reliably to the demanded biological efficacy.

Not least of the problems is that the certified performance criteria of sophisticated new treatment equipment seems to fall short of testing requirements that may be applied by port state control authorities.  Much more work still needs to be done by governments to rectify the current situation.

“We note that IMO decided not to reopen the G8 guidelines but asked BLG 17 to look into certification guidance on the G8 guideline with the aim of providing greater clarity on the operating conditions in which BWTS are expected to operate.  Factors to be taken into account include seawater salinity, temperature and sediment load, as well as operation at flow rates significantly lower that the rated treatment flow rate.

IMO also asked member States to submit case studies with quantitative evidence of BWTS failures to improve understanding of the areas of weakness within the approval process.

While this is a step in the right direction, the BWM Convention was designed to assure the ability to meet the required standard by a treatment system installed on an operating vessel. Having requirements that ensure the equipment is fit for purpose is an important element in achieving successful implementation.” said IACS Chairman, Tom Boardley.

The Tripartite meeting agreed that the industry is faced with a challenge both in respect to the timeline and to the lack of maturity of individual treatment systems.  One mitigating factor would be to define existing ships as those having been constructed prior to entry into force of the Convention, and that retrofitting of Type Approved ballast water management systems should not be required until the next full 5 year survey, rather than the next intermediate survey.

Speaking at the end of the Tripartite meeting ICS Chairman, Masamichi Morooka said:

“It is good that many governments now seem to understand the shipowners’ arguments that it will be very difficult indeed to retrofit tens of thousands of ships within the timeline of two or three years of entry into force, as the Convention text currently requires.  IMO has agreed to develop an IMO Assembly Resolution, for adoption in 2013, to smooth the implementation.”

“It is vital that we ease the log jam by spreading implementation over five years rather than two or three.” said Dave Iwamoto, Chairman of the Committee for Expertise of Shipbuilding

Specifics.

The meeting agreed jointly to engage further with governments in order to explain the scale of the challenge faced by the shipbuilding and repair community in order to cope with the vast number of ships that will be required to install the new treatment systems.

The Tripartite went on to discuss the enforcement and compliance issues that will arise as systems are installed and the Convention comes into force. A major challenge is that any compliance action will not be taken against the treatment system manufacturer or test facility, but rather against shipowners who in good faith may have installed a system Type-Approved by a government. Given the current knowledge about apparent shortcomings in the Testing and Approval requirements when compared with the real life operating environment, the G8 Guidelines must be updated.  A Type-Approved system, costing between one and five million dollars per ship, should reasonably be expected to robustly operate effectively under all of the normal operating conditions encountered by that ship.

“We are all in full support of the IMO and the intentions behind the Ballast Water Convention. However, given where we are today, we need to re-address both the timeline and the Approval requirements defined in the G8 guidelines in order to ensure that we achieve the real intentions of the Convention without unnecessary costs and unintended compliance issues”

“We need to urgently engage with both the IMO and with individual Governments in order to address these issues” said ICS Chairman Mr Morooka.

—ends—

This Press Release is issued jointly by:

ICS;  IACS; BIMCO; Intercargo;  Intertanko; OCIMF; and CESS (Committee for Expertise of Shipbuilding Specifics)