The International Chamber of Shipping (ICS) has published its latest Annual Review of maritime policy and regulatory developments in advance of its Annual General Meeting.
The 2014 Annual Review covers the wide-ranging scope of ICS's activities as the world's principal international trade association for ship operators, and can now be downloaded free of charge from the ICS website (www.ics-shipping.org/docs/annualreview2014).
Printed copies are being distributed via ICS's 34 member national shipowners' associations, which collectively represent all sectors and trades and over 80% of the world merchant fleet at international regulatory bodies that impact on shipping, including the International Maritime Organization (IMO).
The 2014 ICS Annual Review focuses on a number of key issues, including: issues relating to the implementation of new IMO requirements for low sulphur fuel in Emissions Control Areas from January 2015; outstanding concerns surrounding the implementation of the IMO Ballast Water Management Convention; enforcement of the ILO Maritime Labour Convention (MLC); and developments with respect to piracy and hostage taking.
In his introduction to the Review, ICS Chairman, Masamichi Morooka, focuses in particular on the need for governments to address questions regarding the implementation of impending environmental regulations: "The shipping industry is about to invest billions of dollars in order to further improve its already impressive environmental performance. In parallel therefore it is reasonable for shipowners to expect that governments will properly implement and enforce these new regimes".
The ICS Annual Review also addresses developments in maritime safety, including a reflection on the industry's improvements in the 25 years since the ‘Exxon Valdez' oil spill. Updates with respect to labour affairs, manning and training, maritime law and insurance, and shipping and trade policy are also provided.
"The Annual Review is intended to provide an overview of just some of the many matters on which ICS is representing the views of the global shipping industry" remarks Mr Morooka. "It is still a source of amazement to me just how many issues ICS seeks to cover, with the support of its member national shipowners' associations and regional partners."
Low Sulphur Fuel
In order to address concerns about the health impacts of sulphur on local populations, this change will apply to ships trading within the Emission Control Areas (ECAs) that have been established in North America, the North Sea and the Baltic, in accordance with the 2008 amendments to MARPOL Annex VI. For the vast majority of ship operators this will require the use of far more expensive distillate fuel (gas oil) with a sulphur content of less than 0.1%.
Serious concerns remain about the accuracy of any fuel testing that might be undertaken during Port State Control (bearing in mind that many ships will be switching between residual fuel and distillate before entering an ECA) and the arrangements that will apply for assessing compliance when a ship may only be in transit through an ECA. There are also big questions about the accuracy of ambitious proposals for enforcement methods using aerial surveillance. It remains to be seen if these questions will be fully resolved before 1 January 2015.
With respect to the issue of fuel availability and the economic impact on the industry, there is also growing concern about the implementation of the global cap that will reduce the sulphur content in fuel consumed outside ECAs to 0.5%.
This is scheduled to take place in 2020, with an option for IMO to decide to delay until 2025 if necessary, depending on the outcome of an IMO fuel availability study due, as required by MARPOL, to be completed no later than 2018. It is assumed that most ship operators will comply with the global cap using a blend of distillate and residual fuel.
In April 2014, the IMO MEPC agreed to continue its consideration of a methodology for conducting the fuel availability study, under the leadership of the United States. While this is welcome, it remains to be seen whether IMO will conduct the study in sufficiently good time before the entry into force of the global cap.
The Ballast Water Management Convention
It is nevertheless important to recall that when the BWM Convention finally enters into force shipowners will collectively be required to invest in excess of a hundred billion dollars in new ballast water treatment systems. ICS therefore continues to be very concerned about some serious implementation problems, which IMO has so far been reluctant to address decisively
ILO MLC Towards Full Enforcement
The entry into force of the Convention is the culmination of more than 10 years of work by governments and their ILO social partners, represented throughout the process by ICS (under the banner of the International Shipping Federation) and the International Transport Workers’ Federation (ITF).
The wider significance of the entry into force of the MLC, which is seen by the ILO as a model that might be emulated by other industrial sectors, was demonstrated by the ILO Director-General, Guy Ryder, accepting an invitation to address the ICS International Shipping Conference in September 2013 (together with the IMO Secretary-General).
The purpose of the MLC is to establish a global level playing field of employment standards for seafarers, embracing the ILO concept of ‘Decent Work’. Important matters covered include the obligations of employers on contractual arrangements with seafarers, oversight of manning agencies, health and safety, work hour limits, crew accommodation, catering standards and seafarers’ welfare.
As with IMO Conventions, the ILO MLC is an organic document. Now that the MLC has entered into force it can be subject to further change. In April 2014, the first such amendments, concerning arrangements to ensure the payment of wages in situations such as a shipping company going bankrupt, were adopted by an ILO Special Tripartite Committee at which ICS co-ordinated the Employers’ Group. These amendments are expected to be implemented within the next three years.
Piracy
Somali pirates are still active and retain the capacity to attack ships far into the Indian Ocean. In 2013 there were at least 13 reported incidents including two hijackings. It must also not be forgotten that many seafarers are still being held hostage, some having been in captivity for over three years.
At the end of 2013, ICS issued a strategy paper drawing upon the international shipping industry’s experience of Somali-based piracy since 2007. The intention is to identify lessons learned in order to help shape future policy responses, wherever in the world they might be needed. The ICS paper has been submitted to the International Contact Group and by all accounts has been well received by governments.
IMO Conventions Effective Implementation
In order to operate efficiently, the international shipping industry depends on the global regulatory framework provided by IMO. The alternative would be chaos and market distortion, as well as inferior levels of safety and environmental protection.
Dramatic improvements in the industry’s recent performance are in large part due to the success of IMO Conventions. In those regions of the world where the vast majority of maritime trade takes place, it is now extremely difficult for sub-standard ships to operate without detection and sanctions.
IMO Conventions Highlighted by ICS/CMI Ratification Campaign
Protocol of 1997 to MARPOL (Annex VI – Prevention of Air Pollution from Ships)
International Convention for the Safe and Environmentally Sound Recycling of Ships (Hong Kong), 2009
Convention on Facilitation of International Maritime Traffic (FAL), 1965
Protocol of 1996 to the Convention on Limitation of Liability for Maritime Claims (LLMC), 1976
Protocol of 2002 to the Athens Convention relating to the Carriage of Passengers and their Luggage by Sea (PAL), 1974
International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea (HNS), 1996, and Protocol of 2010
Protocol of 2003 (Supplementary Fund) to the International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage, 1992
Nairobi International Convention on the Removal of Wrecks (Nairobi WRC), 2007
Industry Improvements since ‘Exxon Valdez'
On the 24 March 1989, the oil tanker ‘Exxon Valdez’ grounded in Prince William Sound, Alaska. The rest as they say is history. Although not in any way the largest ever oil spill (with respect to tankers a dubious honour that went to the ‘Atlantic Empress’ in 1979, and exceeded further still by the Gulf of Mexico offshore drilling disaster of 2010) the ‘Exxon Valdez’ is almost certainly the most notorious. Nobody was killed; but it will very probably be remembered for many years to come as an event that changed the course of maritime regulation, especially with respect to pollution prevention.
The immediate legacy of the ‘Exxon Valdez’, facilitated by amendments to the MARPOL Convention (and in the United States by the adoption of OPA 90 – the US Oil Pollution Act) was the replacement of the world tanker fleet with double hull designs. The very small number of single hull tankers still trading internationally should be phased-out completely in 2015. But the incident also gave impetus to other important regulatory changes. These include the adoption by IMO of the International Safety Management (ISM) Code in 1993, which also embraces environmental protection, and the radical amendments to the Convention on Standards of Training, Certification and Watchkeeping for Seafarers (STCW) in 1995.
The impact of these measures was perhaps not fully realised until the early 2000s, but there is a clear correlation between the implementation of ISM and STCW 95 and the subsequent reduction in the number of serious maritime casualties and pollution incidents.
The ‘Exxon Valdez’ also led to a closer examination of issues such as the prevalence of fatigue amongst seafarers and the dangers of drug and alcohol abuse, greatly influencing current international regulation.
A Call to overhaul SOLAS
The Safety of Life at Sea Convention (SOLAS), alongside MARPOL, is one of the core IMO instruments and underpins the global maritime framework with respect to all aspects of maritime safety, including ship construction, equipment, navigational safety, the carriage of cargo, emergency procedures, as well as the obligations of ships with respect to search and rescue.
In June 2013, IMO hosted a major Symposium on the Future of Ship Safety. The ICS Secretary General chaired one of the sessions and several speakers from companies nominated by ICS featured in the programme. But the most important outcome of the Symposium, which has the full support of the IMO Secretary-General, was a recommendation that the SOLAS Convention should be subjected to a comprehensive review.
Details of what any review of SOLAS is likely to involve are limited at this stage. But if, as expected, this proposal is taken forward, a significant amount of ICS time and resources will need to be dedicated to what could be a very important initiative.
Monitoring and Reporting OF CO2
Shipping is unique in being the only industry already covered by a binding global agreement to reduce its CO2 emissions, through the amendments to MARPOL Annex VI that entered into force in 2013. These measures are expected to reduce CO2 emissions per tonne of cargo carried one kilometre by 20 percent by 2020 (compared with 2005) with further emissions reduction going forward. However, there is a widespread expectation amongst many governments that IMO should build further on the technical and operational measures that it has already adopted.
E-Navigation
The current debate about ‘e-navigation’ involves linking the growing number of electronic navigation and communications systems into a single cohesive system, connecting ship and shore. It thus provides an opportunity to standardise, integrate and, where appropriate, further automate a future generation of ships’ navigational equipment.
Meanwhile, in co-operation with ECSA, ICS is about to participate in two major EU projects (MonaLisa 2 and EfficienSea 2) as well as the Norwegian funded SESAME project. These projects are examples of a growing number of well funded e-navigation test beds with regional rather than IMO reporting responsibilities. In the absence of further specific proposals by administrations to take on further work, the extent to which IMO will maintain effective oversight on the development of e-navigation is unclear. ICS therefore wishes to ensure that the interests of international shipping are taken into account fully during the conduct of major projects, being undertaken outside the purview of IMO.
Manning and Training
In 2014, ICS will begin work in earnest, in co-operation with BIMCO, on the next comprehensive update of the industry’s definitive five yearly study into the global supply and demand for seafarers. This major project is scheduled to be completed during 2015.
The STCW 2010 ‘Manila’ amendments are currently being phased-in over a five year period that ends in 2017. Since 1 July 2013, all new entrants are now required to be trained in accordance with the revised STCW competence standards. In addition, by July 2013, Parties to the Convention were meant to have provided information to IMO on the measures that they have taken to implement the STCW 2010 standards, in order to maintain a place on the STCW ‘white list’ which is relevant to flag state recognition procedures and Port State Control targeting. The extent to which governments have met their obligations will hopefully become clearer at the next meeting of the IMO Maritime Safety Committee in May 2014, which is responsible for approving the ‘white list’, as well as the quality standards reports that Parties are required to submit at five year intervals.
Source and Image Credit: ICS
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