Release of the car carrier ‘Global Spirit’, which was detained for three weeks by Belgian environmental authorities in the port of Antwerp, has been welcomed by the International Chamber of Shipping (ICS), the global trade association for shipowners.

The vessel had been detained for alleged non-compliance with the European Union Waste Shipment Regulation, the ship having originally been scheduled to be recycled in a non-OECD country. ICS maintains that the detention was inappropriate, and that this EU Regulation was never intended for application to international shipping or to ships which are scheduled to be recycled. However, ICS is pleased that the local authorities have come to an understanding with the shipowner.

ICS also greatly welcomes the emphasis now being given by the Belgian authorities to the importance of the rapid entry into force of the International Maritime Organization (IMO) Hong Kong Convention on Ship Recycling and its commitment to speed up Belgium’s ratification of this important Convention. ICS fully agrees with the Belgian authorities that the entry into force of the IMO Convention ‘is the best guarantee and the only way forward for sustainable ship recycling’ throughout the global shipping industry.

ICS reiterates the following points, which were communicated by ICS to the Flemish Ministry of the Environment when the ship was still detained:

The EU European Waste Shipment Regulation, and the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes (on which the EU Regulation is based) were never intended for application to international shipping or to ships which are scheduled to be recycled. This important point has been repeatedly recognised during discussions that have taken place since the Basel Convention was adopted.

The relevant international regime which is applicable to international shipping is the IMO Hong Kong Convention for the Safe and Environmentally Sound Recycling of Ships. While this instrument has not yet entered into force, it is fully supported by the international shipping industry. It also provides a sounder and far more relevant basis for determining whether a shipping company is meeting its responsibilities to ensure that redundant ships are indeed being recycled in a safe and environmentally sustainable manner. All IMO Member States are therefore encouraged to work towards the ratification of the IMO Hong Kong Convention as soon as possible.

The international shipping industry is fully committed to the safe and environmentally sound recycling of redundant ships. This is demonstrated by the development by the industry of Guidelines on Transitional Measures for Shipowners Selling Ships for Recycling, which sets out the measures that shipowners might reasonably undertake in order to adhere to the spirit of the IMO Hong Kong Convention in advance of its entry into force.

Proposals to protect the world’s oceans have been welcomed by the International Chamber of Shipping (ICS), the principal trade association for merchant shipowners. ICS recommends that the Global Ocean Commission’s (GOC) ideas should be taken seriously.

The GOC wishes to see a greater level of environmental protection, especially with respect to areas of economic activity, other than shipping, that currently may not be adequately regulated. Issues addressed in its inquiry report, launched in New York last night, include preserving global fishing stocks, preventing ongoing damage to ecosystems caused by land based industry and agriculture, and preventing the acidification of the sea.

ICS Secretary General, Peter Hinchliffe said: “The shipping industry is very fortunate in already having an established framework of global Conventions and rules that have been developed by the United Nations International Maritime Organization. For the most part these IMO rules are fully implemented and enforced worldwide and have directly contributed to the improvement of shipping’s environmental performance. However, shipowners are global citizens who will share the GOC’s concern about the vacuum that still exists with respect to wider governance and protection of the oceans.”

Ideas set out by the Global Ocean Commission include the establishment of a stand-alone UN Sustainable Development Goal for the oceans, a properly resourced and mandated UN Special Representative for the Ocean, as well the creation of an independent Global Ocean Accountability Board. The GOC also suggests that the United Nations Convention on the Law of the Sea (UNCLOS) should be updated, and that additional regulatory measures might need to be applied to the High Seas.

“The GOC’s ideas merit serious consideration” said Peter Hinchliffe. “The successful model provided by the International Maritime Organization over the past few decades with respect to helping to improve the environmental performance of ships can no doubt be applied to other ocean activities such as fishing and land based industry. While governments – and industry – may well have legitimate questions about some of the more detailed proposals that have been made by the GOC, its ideas deserve proper analysis and need to be taken seriously.”

The Global Ocean Commission (GOC) comprises senior political figures, business leaders and development specialists. The Commission’s full inquiry findings can be found at www.globaloceancommission.org

Call for Shipping Industry to Anticipate Climate Change Impacts

At a major conference today (18 June) in Liverpool, United Kingdom, hosted by the renowned Tyndall Centre for Climate Change Research, Peter Hinchliffe, Secretary General of the International Chamber of Shipping (ICS), gave the keynote speech explaining the shipping industry’s commitment to reducing its CO2 emissions.

Mr Hinchliffe said that shipping is the only industry with a mandatory global regime in place, agreed by the International Maritime Organization (IMO), to reduce its CO2 emissions. “We are therefore already on a pathway to deliver ships by 2030 that will be 30% more efficient than those of just a couple of years ago.”

He added: “There is a clear mood to address supply chain efficiency at every stage. In particular, the enormous financial pressure of the global recession on freight rates, coupled with virtually year-on-year fuel increases – some 300% over 10 years – has meant that the quest for efficiency is much more than enlightened self-interest and really a means to survive to fight another day.”

The current focus of ICS is helping to ensure that the existing technical and operational measures agreed by IMO are properly implemented. The desire of some governments to develop additional Market Based Measures remains very controversial. ICS believes that the high cost of fuel – set to increase again as the industry switches to low sulphur bunkers – already means that shipowners have every incentive they need to reduce CO2.

Mr Hinchliffe explained that many shipowners fear that the motives for developing MBMs seem to be largely political: linked to the high level debates at the UNFCCC climate talks, and more about generating monies from shipping rather than actually reducing emissions. But the priority of ICS was to help ensure that whatever is decided is agreed for global application by IMO. “ICS takes the view and has argued strongly that the only acceptable MBM – if one is required at all – is a fuel levy,” he said.

However, the IMO debate on MBMs was “on hold” for the time being because the UNFCCC principle of Common But Differentiated Responsibility (CBDR), whereby developing nations wish to accept less ambitious carbon commitments, has yet to be reconciled with the IMO principle of uniform global rules applying to ships of all flags.

Mr Hinchliffe explained that the current focus of debate at IMO is the monitoring and reporting of individual ships’ CO2 emissions. ICS is pleased that IMO is now making progress on CO2 data collection and hopes that this will be compatible with the regional rules being developed by the European Union.

“We feel that measuring fuel consumption overall is a good thing and are fairly confident that we have a good story to tell” said Mr Hinchliffe.

However, ICS maintains concerns about what data collection from individual ships might ultimately be used for, and is opposed to the development of ship indexing based on operational indicators that might be used by governments to penalise older ships unfairly to raise money, leading to serious market distortion.

As well as addressing regulatory developments, Mr Hinchliffe drew attention to the growing need for the industry to take account of the impacts of climate change on shipping, given that extreme weather events appeared to be becoming more frequent.

“Currently ships are built to regulatory requirements upon a definition of North Atlantic winter conditions – these determine the strength of the ship, the thickness of steel, the spacing of strengthening beams and so on,” said Mr Hinchliffe. “Will there come a time when the definition will have to be upgraded? If so how soon will that be, bearing in mind the 30 year design life of a ship?”

He added: “Very few port authorities are doing work to raise infrastructure – higher jetties, higher railway lines and roads – building with a 50 year timeframe in mind. But how many hydrographic offices are thinking about prioritising surveys to ensure that port approaches are surveyed ready for the requirement for new charts in 20 or 30 years’ time – or is it needed sooner than that?”

The International Chamber of Shipping (ICS) – the principal global trade association for shipowners representing over 80% of the world merchant fleet – met in Limassol, Cyprus last week for its Annual General Meeting (AGM). The meeting was hosted by the Cyprus Shipping Chamber in its 25th anniversary year, and commenced with a gala dinner hosted by the President of the Republic of Cyprus, His Excellency Nicos Anastasiades, at the Presidential Palace in Nicosia.

Representatives of ICS member national shipowners’ associations, from the Americas, Asia and Europe, reviewed the many significant regulatory developments affecting shipping with respect to safety, environmental protection and employment affairs, as well as various legal, insurance and trade policy developments.

The discussions were dominated by the pressing challenges associated with the need for ships trading to Emission Control Areas, in North America and Europe, to switch to low sulphur fuel, and the serious implementation problems that will be created by the eventual entry into force of the IMO Ballast Water Management (BWM) Convention.

Sulphur ECAs – Governments Need to Resolve Critical Implementation Questions
ICS underlines the shipping industry’s commitment to full compliance with the IMO sulphur ECA requirements from January 2015, through the use of low sulphur distillate fuel or alternative compliance mechanisms such as Exhaust Gas Cleaning Systems (scrubbers). However, information collected by ICS members suggests that many governments are not ready to implement the requirements in a uniform manner, in order to ensure the prevention of market distortion.

In particular, ICS members identified an urgent need for the Paris MOU on Port State Control – in co-operation with the European Commission and the United States – to finalise harmonised procedures before implementation begins. It was also agreed that port states need to resolve detailed implementation questions on the use of alternative compliance mechanisms for those companies that have chosen to invest in them, as permitted by the IMO MARPOL Convention.

“The shipping industry is investing billions of dollars in order to ensure compliance. The huge costs involved could have a profound impact on the future structure of the entire shipping industry and the movement of international trade,” said ICS Chairman Masamichi Morooka. “It is therefore incumbent on governments to get the details of implementation right as we enter this brave new world in which fuel costs for many ships will increase overnight by 50% or more. We only have six months to go and we think it vital that governments clarify all of the details of ECA implementation as soon as possible.”

Ballast Water Management Convention – Time is Running Out to Make New Regime Fit for Purpose
ICS members considered the deep flaws in the IMO Ballast Water Management Convention (adopted in 2004 when the technology required to comply had not been widely tested or proven commercially) and possible solutions to these issues.

It is apparent that there is now a greater understanding of these problems amongst IMO Member States which for many seems to be the primary issue impeding ratification. These obstacles include the lack of robustness of the current type-approval process for the very expensive new treatment systems that will be required, doubts about the procedures to be followed during Port State Control, and the need to provide confidence to shipowners that have already installed the new equipment (or are about to do so) that they will be regarded by the authorities as compliant.

ICS supports the objectives of the Convention and recognises that its eventual entry into force is inevitable. “However,” explained Mr Morooka “unless these problems are resolved immediately at IMO there is a considerable risk that the regime will not be fit for purpose.”

ICS is particularly concerned that port state sanctions could impact unfairly on shipowners who, in good faith, have fitted type-approved equipment, only to be told subsequently that it falls short of the required standard. At the next meeting of the IMO Marine Environment Protection Committee (MEPC 67) in October 2014, governments need to take what may be the final opportunity to act by agreeing some relatively simple changes to how the Convention will be implemented. “Time is rapidly running out.” said Mr Morooka.

The ICS AGM agreed in principle to the text of a detailed industry submission that will be made to MEPC 67. This submission will suggest solutions to these complex problems in the form of a draft MEPC Resolution that could be adopted by IMO Member States before the Convention enters into force. This final industry submission will be made in the next few weeks.

Future Regulation of International Shipping
The ICS AGM considered the lessons to be learned with respect to the development of regulations, such as the Ballast Water Convention, that have subsequently turned out to have major problems, as well other technical regulations that have often been taken forward without any consideration of the economic impacts, or of the unintended consequences for regulations that already exist.

For the past 50 years IMO has served the industry very well by providing shipowners with a comprehensive global regulatory framework. But there is growing concern that something is wrong with the quality and quantity of recent regulatory changes. All too often ICS sees regulatory proposals by governments being taken forward without any supporting evidence of compelling need.

Mr Morooka explained “Environmental protection is of the utmost importance, and ICS does not question the objectives or good intentions that are usually behind most government proposals. But in the future we believe there needs to be far more emphasis on proper regulatory impact assessments which also take full account of the economic sustainability of shipping. More attention also needs to be given by IMO Member States to the practicality and timescale allowed for implementation of new regulations. This should happen before the rules are adopted, not several years later when it may be too late.”

The ICS members recognised that making improvements to the process of regulatory development at IMO is a complicated and difficult topic, and that there are no simple solutions. But ICS members agreed that in the year ahead they would seek to develop some firm proposals for discussion with regulators.

Elections
Mr Masamichi Morooka (Japan) was elected for a second two-year term of office as ICS Chairman. He will be supported by Mr John C Lyras (Greece), Mrs Karin Orsel (Netherlands), Mr Gerardo Borromeo (Philippines) and Mr Esben Poulsson (Singapore) who continue to serve as ICS Vice Chairmen.