Annual Review 2012
-
Upload
ravi-peter -
Category
Documents
-
view
14 -
download
4
Transcript of Annual Review 2012
![Page 1: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/1.jpg)
2012International Chamber of Shipping Representing the Global Shipping Industry
![Page 2: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/2.jpg)
We acknowledge with thanks the use of photos from the following associations and their member shipping companies:
ANAVE, Spain BW Shipping, Singapore Canadian Shipowners’ AssociationChamber of Shipping of AmericaChina Ocean Going (Group) Co Confitarma, ItalyCyprus Shipping ChamberDanish Shipowners’ AssociationFinnish Shipowners’ AssociationHong Kong Shipowners’ AssociationInterferryIrish Chamber of ShippingJapanese Shipowners’ AssociationRoyal Association of Netherlands ShipownersSwedish Shipowners’ AssociationTurkish Chamber of ShippingUnion of Greek ShipownersVerband Deutscher Reeder, Germany
![Page 3: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/3.jpg)
AnnualReview2012
Representing the Global Shipping Industry
ICS (the International Chamber of Shipping) is the principal international trade association for shipowners, concerned with all regulatory, operational and legal issues. ISF (the International Shipping Federation) is the identity used by ICS when representing the industry on employment affairs issues. The membership of ICS (and ISF) comprises national shipowners’ associations representing all sectors and trades from 36 countries, covering more than 80% of the world merchant fleet.
![Page 4: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/4.jpg)
2
![Page 5: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/5.jpg)
page Contents 4 Chairman’sOverview 5 OfficeBearersandSecretariat
6 KeyIssuesin2012 6 The‘CostaConcordia’Disaster 8 ThePiracyCrisisContinues 10 NavigatingthePoliticsofClimateChange
15 TheYearinReview 15 LowSulphurFuel 16 BallastWaterManagement 17 ChangestoMARPOL 18 ShipRecycling 18 ShipbuildingStandards 19 CargoSafety 21 TankerSafety 22 MalaccaandSingaporeStraits 24 E-NavigationandECDIS 24 TrainingStandards 27 WorkHourRegulations 27 EmploymentRelations 29 MaritimeLabourStandards 30 ILOMinimumWage
page
31 AsianDevelopments 32 EUDevelopments 34 USDevelopments 34 TradeSanctions 38 LLMCIncreases 39 PassengerShipLiability 40 EnvironmentalSalvageAwards 41 RotterdamRules 42 CompetitionIssues 44 InvestigationofIGofP&IClubs 45 FlagStatePerformance 45 ShippingPolicyandFreeTrade 46 ShipbuildingPolicy 49 CanalIssues 50 IndustryRepresentationandCo-operation 52 Publications 54 OrganisationalMatters 55 ICSBoardofDirectors 56 CommitteeStructure Membership
3
![Page 6: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/6.jpg)
ICSChairman,SpyrosMPolemisGreece
THISICSANNUALREVIEWprovidesagoodopportunitytotakestockofeventsduringthelast12monthsthatmayhelptoshapethefuturedirectionofourgreatindustry,andofsomeofthemajorchallengesthatlieahead.Sadly,thiswillbethelastoccasiononwhichIprovidetheopeningremarkstothiscomprehensivereviewofICS’sactivitiesonbehalfoftheglobalshippingindustry.TheinfluencethatICSbringstobearonmaritimeregulatoryaffairsisconsiderable;somethingwhich-despitethehugepoliticalandtechnicalcomplexitiesinvolved-ICSdoeswithconsiderablesuccess,butwithcharacteristicallyquietefficiency.
However,inaworldofmassmedia,andwithaplethoraofdifferentinterestgroupsvyingforattention,falsemodestyisnolongerseenasavirtue.Therefore,assoonasIcametoappreciatetheremarkablebreadthofICS’sactivities,thedepthofitsexpertiseandtherespectwhichitenjoysamongstgovernmentsworldwide,oneofmytasksasChairmanhasbeentotrytoincreaseunderstandingandawarenessofICS’svitalrolewithintheshippingindustryatlarge.IhopethatthisexpandedICSAnnualReviewwillcontributetothattask.Likemostthingsinlifewhichwetakeforgranted,theserviceprovidedbyICSissomethingthattheindustrywouldfindveryhardindeedtodowithout.
ICS,itsmembernationalshipowners’associationsandtheindustrywhichtheyrepresenthavewitnessedagreatdealofchangesinceIwasfirstelectedChairmansixyearsago,againstabackdropofboomingshippingmarketswhichthenplungedintodeeprecession,aswellasmajorchallengesontheregulatoryfront.
Thelattersometimesplacedstrainonthemaintenanceoftheglobalregulatoryframeworkonwhichtheshippingindustrydependstooperateefficiently.Iamverypleasedtoreportthatthisframework,underpinnedbyIMOConventions,remainsfirmlyintactandisstillstronglysupportedworldwide,bygovernmentsandindustryalike.Buttherecontinuestobeaneedtobevigilantagainstunilateralorregionalregulation,notleastwithrespecttomeasurestoaddressshipping’sCO2emissions.DuringmytenureatICS,wehaveseentheadoptionofaradicalIMOagreementthatwilldramaticallyreduceairpollutionand,inJuly2011,thefirsteverglobalagreementcoveringanentireindustrialsectorthatwillensurethatshippingreducesitsCO2emissionsby20%pertonne/kmby2020,withfurthersignificantimprovementsinenergyefficiencygoingforward.Withrespecttothesafetyandwelfareoftheseafarersthatweemploy,andonwhomtheworlddependsfortheefficienttransportationof90%ofworldtrade,wehaveseenmajoradjustmentstotheInternationalSafetyManagement(ISM)CodeandtheIMOSTCWregimegoverningtrainingstandards,aswellastheadoptionoftheILOMaritimeLabourConvention.Thisisinadditiontotheincrementalbutnumerouschangestodetailedregulationsgoverningshipconstructionandequipment,maritimelawandinsurance,andthesmoothoperationofshippingmarkets,whichallhelptoensurethatshippingremainssafe,cleanandremarkablyefficient.TheseareallimportantdevelopmentsinwhichICS,anditsmembers,haveplayedacrucialpart,helpingtoensurethatthebestinterestsoftheindustryandsociety
arereconciledsofaraspossibleinasoundandpracticalmanner.
AsthisAnnualReviewmakesclear,thenextfewyearswillbeverydifficult,withglobaleconomicuncertainty,achronicoversupplyoftonnage,andtrulyenormouscostpressures,notleastwithrespecttobunkers,aswemovetowardsburninglowsulphurfuel.Shipownersalsofacetheprospectofbeingchargedbillionsofdollarsperyearforcarbonemissions,despitebeingbyfarthemostenergyefficientmodeofcommercialtransport.Newrequirementsforballastwatermanagementalsopresentaseriouschallenge,withrespecttoboththeirtechnicalandeconomicviability.
Ofmoreimmediateconcern,shipownersandtheircrewscontinuetofacethewhollyunacceptablescourgeofpiracy,offthecoastofSomaliaandelsewhere.IhavesaiditbeforeandIwillsayitagain,itreallyistimefortheinternationalcommunitytomakeitclear,andforgovernmentstounderstand,thatcriminalattacksagainstinternationalshippingcannotandwillnotbetolerated.
Meanwhile,thedangersofcomplacencywithrespecttotheindustry’sotherwisegenerallyexcellentsafetyrecordhavebeenputintothespotlightbythe‘CostaConcordia’tragedyandotherrecentaccidentsthatwillinevitablyresultwitharobustresponsefromtheregulators.Itmustbehopedthatthisresponsewillbemeasuredandbasedonathoroughanalysisofthefacts,aswellasaproperdebateaboutthetechnicalmeritsofargumentsforanyproposedchangestorulesorprocedures.ICSwillofcoursecontributeactivelytothisdebateintheyearahead.
Chairman’sOverview
4
![Page 7: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/7.jpg)
IamverypleasedthatmylastfewmonthsinofficehavecoincidedwiththeappointmentofMrKojiSekimizuasthenewSecretary-GeneralofIMO.Iamespeciallypleasedthat,whilstsharingICS’sultimategoalofzeroaccidentsandzeroimpactfromshippingontheenvironment,hetoobelievesthatmoreshouldbedonetoexplaintheimpressiveperformanceoftheindustrytoitsinternationalregulators,topoliticiansandtohighlevelpolicymakers.ICSlooksforwardtoparticipatingalongsideIMOatthe‘Rio+20’UnitedNationsSummitonSustainableDevelopmentinJune2012.IthastrulybeenapleasuretoserveastheChairmanofICS,aswellasagreatresponsibility.Ihaveverymuchenjoyedmycontactwiththemembernationalassociations,andImustexpressmydeepappreciationtotheICSBoardofDirectors,andtothosewhocontributewithsuchdedicationtothevitalworkofICS’sexpertcommitteeswhichproduceICSpolicypositionsanddevelopinvaluableguidanceonindustrybestpractice.Iwishmysuccessorwell,andIamveryconfidentthatunderhisleadershipICSwillcontinuetoservethebestinterestsofourindustryinthehighlyconsideredandprofessionalmannertowhichwehavebecomesoaccustomed.SpyrosMPolemisChairman
MrFrankLeonhardtGermany
ICSViceChairman2011/12
MrGerardoBorromeoPhilippines
MrTrygveSeglemNorway
CaptainDirkFryCyprus
SecretariatMrPeterHinchliffeSecretary General
*positionheldjointly
MrSimonBennettDirectorExternalRelationsMsLindaHowlettDirectorLegalAffairs*MsKiranKhoslaDirectorLegalAffairs*MissCamillaAranaPolicyOfficerMrPhillipBinksAdviserMrAlistairHullTechnicalManager
MrsSusanGrayDirectorFinanceandAdministrationMrsKathrynHallPersonalAssistanttoSecretaryGeneralMrsCatherineHowlettAdministratorPublications
MrJohnMurrayDirectorMarineMrsNatalieShawDirectorEmploymentAffairsMrDavidTongueDirectorRegulatoryAffairsMrJamesLangleySeniorAdviserMissEmilyRowleyAdviserMrJohnStawpertSeniorAdviser
MrsShantelRyanPublicationsManagerMrsAnitaPowAdministratorShippingPolicyMissJulieRogersAdministratorMarineDepartment
5
![Page 8: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/8.jpg)
The‘CostaConcordia’Disaster
a‘stateoftheart’vesselmannedbyahighlyqualifiedcrewwhowereusingthelatestnavigationalequipment.
On13January2012,inthefullglareoftheworld’smedia,thecruiseship‘CostaConcordia’groundedandcapsizedoffthecoastofItalywithover4,000peopleonboard.Tragically,atleast30liveswerelost.Thisseriousmaritimecasualtyappearstohavebeenatextbookcaseofanaccidentthatshouldneverhavehappened,madeallthemorepoignantbythe100thanniversaryofthesinkingofthe‘Titanic’withwhichcomparisonshaveinevitablyiferroneouslybeenmade.Thatsaid,questionsarebeingaskedaboutwhatmighthaveoccurredhadasimilarincidenttakenplaceatamoreremotelocationawayfromsophisticatedsearchandrescueservices.
TheItaliancruiseshipstruckrocksin
EVERYONEINSHIPPINGrecognisestheneedtobepreparedfortheunexpected.Whatwasnotforeseenwasthatthedefiningeventof2012wouldbethetragiclossofthe‘CostaConcordia’andthatthesafetyrecordoftheindustrywouldbeputunderthespotlightinthemostdramaticwayimaginable.Thishighprofiledisastermayalsohaveimplicationsforothertypesofshipbeyondthecruisesector,anditwillalmostcertainlyhaveasignificantinfluenceontheimmediateregulatoryagendaatIMO.
Safetyoflifeatseamustalwaysremainthehighestpriorityandthewayinwhichtheindustryaddressesanyissuesraisedbythismajoraccidentmayreflectonitsreputationforyearstocome.Itwillbevitalfortheindustrytounderstandthesequenceofeventsthatledtothedisaster,whichinvolved
6
KEY ISSUES IN 2012
![Page 9: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/9.jpg)
theTyrrhenianSeajustofftheeasternshoreofIsoladelGiglio,withmediareportssuggestingthatthevesselcametooclosetotheislandinwhatarewellchartedwaters.Itseemstheimpactrippedanenormousgashontheportsideofthehull,floodingpartsoftheengineroomandcausinglossofpowertopropulsionandelectricalsystems.Withwaterfloodingin,theshipreachedtheislandseveralhourslater,whereitgroundedinshallowwaterwithmostofthestarboardsideunderwater.
WithICSsupport,theCruiseLinesInternationalAssociation(CLIA)andtheEuropeanCruiseCouncil(ECC)ledtheimmediatesector-specificpublicrelationsresponse.Moreimportantly,CLIAmembershavebeenconductingarootandbranchreviewoftheirsafetyandoperationalprocedures.However,ICSwillbecloselyinvolvedintheinevitable
regulatorydiscussionsatIMO,aswellasintheEuropeanUnionandtheUnitedStates.TheEuropeanCommissionhasalreadyannouncedthatitwilllaunchapublicconsultationandlegislativereviewduringthecourseof2012whiletheUSCongressisconductingitsownhearingsgiventhatalargeproportionofcruiseshippassengersareUSnationals.
ItishopedthattheItaliangovernmentwillpresenttheresultsofitspreliminaryinvestigationsforconsiderationbytheIMOMaritimeSafetyCommitteeassoonaspossible,althoughitstaskiscomplicatedbecausethedisasterissubjecttoacriminalinvestigation.Whileitisstillfartooearlytoknowwhattheoutcomeoftheaccidentinvestigationwillbe,questionsraisedbythemediasuggestthataswellasnavigationalissuesandemergencyprocedures,stabilityissuesmaycome
underfurtherscrutiny.Thedebateaboutthelargesizeofmoderncruiseships,andarrangementsconcerninginsuranceforliabilities,arealsolikelytobegivenrenewedattention.ProposalstoreviewtheproperapplicationoftheIMOInternationalSafetyManagement(ISMCode)arealsoanticipated.
Forthemomentatleastitseemsthatpoliticiansandregulatorsarecommendablyrefrainingfromknee-jerkresponsesuntilthecausesoftheaccidentarefullyunderstood.However,thisapproachmayyetchangeduringtheyearaheadasmorefactsaboutthisunfortunateincidentarereleasedandthecriminalproceedingsinItalyreceivefurthercloseattentionacrossthemedia.
7
![Page 10: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/10.jpg)
ITISIMPORTANTtorecallthatthecontinuingcrisisintheIndianOceanandattacksagainstshippingbySomalipirateshavealreadyledtoover60seafarerslosingtheirlivesandover4,000seafarersbeingtakenhostage.PiracyhasalsobeenestimatedtocosttheglobaleconomybillionsofdollarsayearandiscausinguntolddamagetotheeconomiesofAfricaandtheMiddleEast.Buttheprincipalconcernofshipoperatorsishumanitarian.Itissimplyunacceptablethatsomanyseafarershavebeenkilled,whilehundredsmorearestillbeingheldcaptiveinappallingconditions.Thousandsofseafarersstillhavetotraversethedangerareainseriousfearfortheirlives,andthestrainontheirfamiliesmustalsonotbeforgotten.
Notwithstandingthesuccessofcurrentmilitarydeployments,thereisstillapressingneedforthegovernmentsofthosenationswiththelargestmilitarynaviesintheregiontoincreaseresourcesavailabletotheextentthatisnecessarytohaveagamechangingimpact.Inco-operationwiththerestoftheindustry,includingthoseorganisationssupportingtheexcellent‘SaveOurSeafarers’campaign,ICSiscommittedtohelpingensurethattheproblemofpiracyretainssufficientpoliticalandpublicattention,sothatthecrisismightbeproperlyanddecisivelyaddressedduring2012.
SomepressreportsmayhavegiventheimpressionthatthelevelofpiracyoffSomaliaisdecreasing.Butasdatafromthemilitarymakesclear,piratecapabilityisactuallyhigherthanever.However,counter-piracyworkintermsofcompliancewiththeBestManagementPracticesdevelopedbytheindustryinco-operationwithnavies(anupdatedversion–BMP4–wasissuedinOctober2011)andsustainedmilitary
interventionwithamoreaggressivestancehasreducedthepirates’rateofsuccess.Thankfully,thenumberofcrewheldinSomaliaisalsoatalowerlevelthanhasbeenthecaseforsometime,withabout200seafarerscurrentlyincaptivity,althoughitmustbestressedthatthissituationisstilltotallyunacceptable.
InFebruary2012,thePrimeMinisteroftheUnitedKingdomhostedamajorintergovernmentalconferenceonSomalia.ICSwelcomedthecommitmentsmadetotrytorestoregovernmentandcivilsocietyinthisconflictriddencountry,theabsenceofafunctioningstatebeingoneoftheunderlyingcausesofviolentSomalipirateattacks.However,addressingtheseissueswilltakeyearsifnotdecadesandtheConferencedidnotappeartoresultinanyfirmpoliticalcommitment,ornewaction,toeliminateorsignificantlyreducethescourgeofSomalipiracyintheimmediatefuture.
ICSbelievesthatgovernmentsmusttasktheirmilitaryforcestotaketheattacktothepiratesandensurethatthemilitaryassetsrequiredtodothisaremaintainedintheatresothattheycancontinuetodefendmerchantshipsinthebestwaypossible.Encouragingly,inMarch2012,EUgovernmentssignalledthattheymaybemovinginthisdirection,andextendedthemandateofOperationAtalantauntil2014.HoweverlittlementionwasmadeattheFebruaryConferenceoftheobligationsofgovernmentsundertheUnitedNationsConventionontheLawoftheSeatoprotectmerchantshipsandtheircrewsfrompiracy,andthefearpersiststhatthecurrentlevelofpirateattacksissomethingwhichgovernmentsmightbewillingtocontinuetotolerate
becauseshipsareoutofsightandoutofmind.
Governmentabdicationofresponsibilityforshipsecuritytoprivatearmedguards,towhomshippingcompaniesarenowresortinginincreasingnumbers,isnotaviablelongtermsolutionforeliminatingpiracy.However,becauseoftheirgrowinguse,ICSisnowpressingIMO,andtheInternationalContactGroupworkingundertheauspicesoftheUN,togiveurgentconsiderationtotheregulationofarmedguardsandthecriteriaagainstwhichtheymightbevetted.TheGUARDCONcontractlaunchedbyBIMCOisaveryhelpfultool,butitdoesnotaddresseverylegalproblemtowhichshippingcompaniesandMastersmightpotentiallybeexposed.
AnotherkeyobjectiveofICSistoensurethateverycapturedpirateissenttotrial.Counter-piracyeffortshavebeengreatlydiscreditedbythelackofappropriatedomesticlegislationinmanynations,includinganyoffenceof‘intenttocommitpiracy’.ThishasledtoacontinuationoftheabsurdsituationwherebypirateswhoarecapturedbynaviesaresometimesreleasedbacktoSomalia.ICShasthereforewelcomedthefocusoftheFebruaryConferenceontheneedforapprehendedpiratestobearrested,takentoacourtoflawand,iffoundguilty,imprisoned,includingtheannouncementtoestablishanewRegionalAnti-PiracyProsecutionsIntelligenceCo-ordinationCentrebasedintheSeychelles.
ICShasalsowelcomedthedeterminationofgovernmentstobreakthefinancialchainthroughlegalactionagainstcriminalfinanciersinvestinginpiracywhereverintheworldthey
ThePiracyCrisisContinues
8
KEY ISSUES IN 2012
![Page 11: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/11.jpg)
areidentified.However,theshippingindustrywouldbedeeplyconcernedbyanysuggestionthatthepaymentofransoms,inordertosecurethereleaseofseafarersbeingheldhostage,shouldbeprohibitedorsomehowcriminalised.TheUKForeignOfficehasadvisedthatthisisnottheintentionbehindanewinternationaltaskforceonpiratefinancingthatisbeingestablishedin2012.However,thepossibilityofbanningransomshasreceivedconsiderablemediaattentionandsometimesunhelpfulcommentfromseniorpoliticianswhoshouldperhapsbemoremindfulofunintendedconsequences.
Intheeventthatseafarersaretakenhostage,theinabilityoftheinternationalcommunitytoeliminatepiracyortorescuehostagesmeansthatshipownershavenooptionbuttopayransoms.Thealternativewouldbeforshipownerstoabandon
theircrewstomonthsifnotyearsofappallingtreatment.Thisincludestortureandmurder,whichhasalreadybeentheresultwhenransomshavenotbeenpaid.Intheeventthatransompaymentswereprohibitedorcriminalised,manyseafarersandshippingcompanieswouldunderstandablyrefusetosailintheaffecteddangerarea,withsignificantimplicationsforthelargeproportionofworldtrade,includingabout40%oftheworld’soilshipments,whichistransportedviatheWesternIndianOcean.
Toreiterate,theprimaryconcernoftheindustryishumanitarian,andshipownershaveadutyofcaretotheircrewsandtheirfamilies.MentionmustthereforebemadeoftheimportantworkoftheMaritimePiracyHumanitarianResponseInitiative,towhichICShascontributed,thathascompiledgoodpracticeguidelines
forshippingcompaniesandmanningagenciestohelpsupportseafarersandtheirfamiliesaffectedbypirateattacks.
FindingasolutiontopiracyremainsaclearpriorityforICS,whichnowfindsitselfparticipatinginnumerousmeetingsatIMOandthevariousworkinggroupssetupbytheInternationalContactGrouponPiracyofftheCoastofSomalia.Whileallthesemeetings,inLondon,NewYorkandelsewhere,aretakingimportantdecisionswithrespecttodetailedfacetsoftheproblem,theyareperhapssymptomaticofthefactthatconsiderationofpiracyisbecominginstitutionalisedandthatgovernmentsmaystillbesidesteppingtherealissueofhowtotacklethepiratesmilitarily.Thetimehassurelycomeforaclearmessagefromtheinternationalcommunityofzerotoleranceofpiracyacrosstheglobe.
Year 2009 2010 2011
Pirate Attacks 117 127 151Disruptions 14 64 27Piratings 46 47 25
Source:EUNAVFOR
![Page 12: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/12.jpg)
INJULY2011,150ormoreIMOMemberStatesconcludedagroundbreakingagreementtoreducetheshippingindustry’sCO2emissions.Thisisthefirstsuchglobalagreementforanentireindustrialsector.AsaresultofamendmentstotheMARPOLConvention,newshipswillhavetobebuiltwithanEnergyEfficiencyDesignIndex(EEDI),whilefrom2013allships,includingexistingships,willhavetoutiliseaShipEnergyEfficiencyManagementPlan(SEEMP)inordertocontrolfuelconsumptionandreduceemissions.
AsaresultofthisIMOagreementontechnicalandoperationalmeasures,andthestepsthatshipoperatorsarealreadytakingtoreducefuelconsumption,ICSisconfidentthatshippingcandelivera20%reductioninemissionspertonne/kmby2020acrosstheentireglobalindustry.
ObjectiveobserversmightbeforgivenforthinkingthatthisIMOagreementisaveryimpressiveachievement,especiallyasshippingisalready,byfar,themostenergyefficientformofcommercialtransport.However,anumberofgovernmentsstillexpectmuchmore.InthecontextofthenewGreenClimateFundthatwasestablishedbythemostrecentUnitedNationsClimateChangeConference,somegovernmentshaveactuallyproposedthatshippingshouldpayasmuchasUS$40billionperyearfortheprivilegeoftransporting90%oftheworld’strade.
TheIMOagreementontechnicalandoperationalmeasuresenjoysthefullsupportoftheshippingindustry.ICShasrecommendedthatallnewshipscurrentlycoveredbytheregulationsaredeliveredwithanEEDI,eventhoughflexibility
Navigating thePoliticsofClimateChange
existstoapplyforflagstatewaivers.ReducingCO2emissionsthroughreducingfuelconsumptionisamatterofenlightenedselfinterestforshipoperators,andtheindustryisfullyengagedinthecontinuingdiscussionsatIMOaboutrefiningtheEEDIandextendingittoshiptypesforwhichEEDIformulaehavenotyetbeenfinalisedduetothemoreproblematicnatureofthecalculations.
Aboveall,theIMOagreementisstronglysupportedbyshipownersbecauseoftheoverridingneedforglobalrulesforaglobalindustry.Ifdifferentrulesweretoapplytoshipsatdifferentendsofavoyagetherewouldbechaos,inefficiencyandseriousmarketdistortion.Aregionalapproachtoreducingships’emissionswouldalsobefarlesseffectiveinactuallyreducingCO2.Climatechange,ofcourse,isaglobalchallenge.
Notwithstandingtheconsiderableeffortsbeingmadetoreduceshipemissionsthroughtechnicalandoperationalmeasures,theindustryisunderpressuretoaccepttheadditionalburdenofsocalledMarketBasedMeasures(MBMs).MarketBasedMeasurestoreduceCO2remainaverycontroversialissueamongshipowners.SomegovernmentsarguethatMBMswillsomehowincentiviseshipownerstoachievefurtherefficiencygains,andmightbridgethegaptheyperceivebetweenthesignificantefficiencyimprovementsthatshippingisalreadydeliveringandtheexpectationsthattotalmaritimetradewillcontinuetoexpandinresponsetothe(longterm)predictedgrowthoftheworldeconomy.
Butinthefaceofrisingfuelcosts,shipownersreasonablybelievethattheyalreadyhaveeveryincentiveto
10
KEY ISSUES IN 2012
![Page 13: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/13.jpg)
improvetheirfuelefficiency.Theintroductionoflowsulphurfuels,aspartofaseparateIMOagreement,isalsoexpectedtoincreasebunkercostsbyinexcessof50%.With2012lookinglikeoneofthemostfinanciallydifficultyearsforshipownersinlivingmemory,nowiscertainlynotthetimetointroduceanadditionalcostpressureintheformofanMBM.ManyintheindustryareconcernedthatsomegovernmentsaremoreinterestedinhowmuchmoneycanbesqueezedfromshippingthroughanMBM,ratherthananyfurtheremissionsreductionthatthismightactuallydeliver.ThechallengeforICS,astheindustry’sprincipalinternationaltradeassociation,isthatdespiteshipowners’justifiedsuspicionsaboutMBMs,itisnecessaryfortheindustrytoaddressthepoliticsofclimatechangeandsomedifficultrealities.
ThefirstoftheseisthattheUNFCCC,anditshighleveldiscussionsaboutreplacingtheKyotoProtocol,isinlargepartdrivingtheagenda.Inaddition,therearethesignificant,andsomewouldargueunrealistic,commitmentsthathavealreadybeenpledgedbynationssuchasEUMemberStates,toreducetheirtotalCO2emissionsdramatically.UnlessIMOcandemonstratethatitismakingrealprogresstowardsthedevelopmentofaninternationalMBMforshipping,theindustrymaybefacedwiththeunwelcomeprospectofregionalaction.
TheotherimportantpoliticalrealityisthedecisionbythemostrecentUNClimateChangeConferenceinDurban,inDecember2011,toestablishtheGreenClimateFund.ThisaimstogenerateUS$100billionperyearby2020,inordertohelpmitigationandadaptationprojectsin
Regulationsenterintoforceforover90%ofworldfleet
ShipEnergyEfficiencyManagementPlan(SEEMP):mandatoryimplementationforallships
EEDIrequiresnewshipstomeetagreedefficiencytargets
Newshipsmustimproveefficiency10%
20%CO2reductionpertonne/km(industrygoal)
50%CO2reductionpertonne/km(industrygoal)
Newshipsmustimproveefficiencyupto20%
Newshipsmustimproveefficiency30%
IMOagreementontechnicalregulationswillreduceships’CO2MARPOLAnnexVI,Chapter4adoptedJuly2011
2013 2015 2020 2025 2030 2050
developingnations.Insimpleterms,thiscanperhapsbeseenasthepriceforpersuadingdevelopingnationstoagreetocontinuenegotiationsonanewUNclimatechangeaccord,scheduledforadoptionin2015.ThisnewUNagreementisintendedtoincludecarbonreductioncommitmentsbyemergingeconomies,notjustfromdevelopedorsocalled‘AnnexI’nationsasisthesituationatpresent.BetweennowandthenextUNClimateConference,inQatar,inDecember2012,theUNFCCCmemberswillbegintoconsiderhow,andfromwhom,thismoneyisgoingtoberaised.
AhighlevelworkinggroupsetupbytheUNSecretaryGeneralandchairedbythepremiersofNorwayandEthiopiahasappearedtosuggestthatsomeUS$16billionperyearcouldberaisedfrominternationalshipping.ButinamorerecentWorld
11
![Page 14: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/14.jpg)
TowardsanIMOMBMICSisleadingindustryrepresentationonthediscussionsatIMOtodevelopaMarketBasedMeasureforshipping,withIMOhavingaviewtoadoptionin2014.
In2011,ICSmemberstooktheimportantdecisiontodeclaretheindustry’spreferenceforanMBMdirectlylinkedtofuelconsumption,ratherthananemissionstradingscheme(ETS).IfgovernmentsdecidethatanMBMshouldbeadopted,ICSmembershaveagreedthatamechanismlinkedtofuelconsumptionistheonethatmostshippingcompaniescouldprobablylivewithinordertoensurealevelplayingfieldandtheavoidanceofseriousmarketdistortion,concludingitwouldbefarsimplertomanageandmoretransparentthananETS.
Inawelcomemove,theIMOSecretary-GeneralhasannouncedtheintentionofIMOtoconductafullimpactassessmentofthevariousMBMproposals,withdetailedtermsofreferencetobedevelopedin2012.
Bankreport,preparedfortheG20SummitinCannesinNovember2011,itwassuggestedthatshippingshouldcontributesomeUS$25billionperyear.Andthedemandsdonotstopthere.SomegovernmentshavepublicallysuggestedthatonlyaproportionofanymoneycollectedfromshippingshouldactuallygointotheGreenFund,andthatasignificantchunkshouldgostraightintothetreasuriesofthegovernmentscollectingit,implyingthatthechargeimposedonshippingcouldactuallybeevenmore,perhapsasmuchasUS$40billionperyear.ThepositionofICSisthatifgovernmentsdecidethatshippingshouldcontributetotheGreenFund,thenthepaymentsshouldbeproportionatetoshipping’scontributiontotheworld’stotalCO2emissions.TocontributethekindofsumswhichtheWorldBankhassuggestedwouldbetotallyinequitable
andalmostcertainlyviewedbymanyemergingeconomiesasataxontrade
–aformof‘greenprotectionism’.
However,theparamountgoalfortheshippingindustryistheavoidanceof‘doublecharging’throughcontributionstotheUNFCCCandviaanyMBMagreedatIMO.TherewouldthereforeseemtobeaneedforaclearlinkagebetweenanyIMOMBMandanyshippingcontributiontotheGreenFund.
TheotherpoliticalrealitythatshippinghastoaddressistheUNFCCCprincipleofCommonButDifferentiatedResponsibility(CBDR),wherebytheemissionreductioncommitmentsacceptedbydevelopingnationsarelessthanthoseofmatureeconomies.ThechallengehasbeenhowtoreconcilethiswiththeIMOprincipleofnomorefavourabletreatmentforshipsunderdifferentflags.On
12
ComparisonofCO2emissionsbetweendifferentmodesoftransportgramspertonne-kmSource:NTM,Sweden
600
500
400
300
200
100
0
Cargovessel2,000-8,000dwt
21
Air freight
747-400 1,200 km
flight
540
Cargo vessel over 8,000 dwt
15
Heavy truck with
trailer 50
![Page 15: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/15.jpg)
theonehand,theEuropeanUnionthreatensregionalactionifIMOfailstodeliveronCO2,whileontheother,developingnations-ledbyChina,IndiaandBrazil-remainopposedtosupportinganIMOagreementwhichtheyfearmightprejudicetheirpositionatthehighlevelUNFCCCnegotiations.
Intheevent,withtheindustry’sfullsupport,IMOhasalreadyproveditselftobeeminentlycapableofdeliveringaglobalsolutionforshippingwhichcanbereconciledwiththeCBDRprinciple.TheJuly2011agreement,whichadoptedbindingglobalregulationsfortechnicalandoperationalmeasurestoreduceships’emissions,willenterintoforceinJanuary2013andwillapplytoatleast90%oftheworld’stonnage.ToaddressCBDR,theagreementincludedregulationsontechnologytransferandtechnicalassistancefordevelopingnations(althoughthedetailsofhowthiswillworkarestill
beinghotlydebated)aswellasaflagstatewaiverwithrespecttotheEEDI(althoughtheindustryhasdecidednottomakeuseofthis).
SecuringsupportforanIMOMBMfromnationslikeChinaandIndiawillalsorequireaccounttobetakenofCBDR.However,reconcilingtheCBDRprinciplewithanIMOMBM,whichmustapplyequallytoshipsofallflagsinordertoavoidmarketdistortion,willnotbeaneasytask.ButifanyofthemoneycollectedbyanIMOMBMwaschannelledtotheGreenFund(perhapsviaanIMOcompensationfundintowhichmoneyraisedfromshippingwaspaid)thiscouldperhapsbeameansofmeetingtheCBDRprinciple.Developingnationswouldbereceivingmoremoneythantheywerecontributing,whilepreservingthelevelplayingfieldforshipping.However,thechallengeofpersuadingnationssuchasChinaandIndiato
agreetosuchanapproachshouldnotbeunderestimated.
ICSwillcontinuetosupportIMOasthebodywherediscussionsaboutashippingMBMandanycontributiontotheGreenFundshouldtakeplaceHowever,theindustrywillfirmlyresistanynotionthatitcanberegardedasacashcow,andwillcontinuetoemphasisethatthebestmeansofdeliveringmeaningfulCO2emissionreductionwillbethroughtechnicalandoperationmeasures,ratherthanamechanismwhoseprincipalpurposeissimplytoraisemoney.
13
RepresentingtheGlobalShipping
Industry
![Page 16: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/16.jpg)
14
![Page 17: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/17.jpg)
TheYearinReview
LowSulphurFuel
In2008,IMOadoptedradicalamendmentstoMARPOLAnnexVIgoverningatmosphericpollution,whichformostshipswillrequiretheuseofexpensive,distillategrade,lowsulphurfuel.Whiletheuseofexhaustgascleaningsystems(scrubbers)ispermittedasanalternative,itisstillunclearwhetherthesewillbetechnically,environmentally,oreconomicallyviableforuseonawidespreadbasis.
Theenormityofthischange,anditseconomicimpactonshippingshouldnotbeunderestimated.Fuelisbyfarthelargestoperationalcostforshipownersandhasalreadyincreasedinpricebyabout300%since2000.Thecurrent50%pricedifferentialbetweendistillateandresidualfueloilispredictedtoincreasefurtherifthenewdemandthatwillbecreatedbytheMARPOLrequirementsisnotmatchedbyincreasedsupply.Exhaustgasscrubbers,assumingtheywork,andthatquestionsareresolvedaboutthewastethatisproduced,havebeenpredictedtocostinexcessofUS$2millionperengineiffittedonboardlargerships.
PerhapsthemostcontroversialrequirementinMARPOLAnnexVIconcernstheneedforshipsoperatinginEmissionControlAreas(ECAs)toburnfuelwithnomorethan0.1%sulphurasfrom2015.Atpresent,theBaltic,theNorthSea,andtheentireWestandEastcoastsoftheUSandCanadahavebeendesignatedassulphurECAsbyIMO,attherequestofthegovernmentsconcerned.Thispresentsamajorchallengefortheoilrefiningindustrywhichwillhavetoexpandtheproductionofcompliantlowsulphurfueltomeetthenew
demand.ThisiscomplicatedbythefactthatitisnotyetfullyknownwhichadditionalareasmaybedesignatedasECAs.Forexample,theEuropeanParliamenthasproposedthatallEUwaterswithin200milesofthecoastshouldbedeclaredassulphurECAs.WhetherthiswillbeacceptedbyEUMemberStates,orinturnwillbesupportedbythescientificstudiesrequiredtogainIMOapproval,isstillanopenquestion.
WhentheMARPOLamendmentswereadopted,ICSwelcomedtheIMOagreementasanacceptablecompromise,althoughthiswasinthecontextoftheevenmoredraconianmeasuresproposedbymanygovernments,andthethreatbytheEUtoimposeanimmediateregionalsolutionifIMOwasunabletodeliveraglobalagreement.Howevertheimplementationofthenewrequirementswillbefarfromeasy,andICSiscloselymonitoringtheprogressthatisbeingmadetoensurethatthedemandfromshippingfordistillatefuelcanactuallybemet.IntheUnitedStates,itisstillveryunclearwhetherornotenoughfuelwillbeavailablefortheUSshippingindustry,letalonethehugeamountofinternationalshippingthattradesinandoutoftheworld’slargesteconomy.
RecentstudiessupportedbytheEuropeanCommunityShipowners’Associations(ECSA)havealsosuggestedthatthemodalshifttolandtransportthatwillprobablyresultfromtheapplicationofthe0.1%limitonsulphurinfuelcouldgreatlydamagelocalshortseashippingwhilebeingdetrimentaltothelocalenvironment.ThisisalsoabigconcernforGreatLakestradesaffectedbytheUS/Canada
15
RepresentingtheGlobalShipping
Industry
![Page 18: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/18.jpg)
ECA.Theseconcernsarenowsharedbymanygovernments,butitremainstobeseenifanywillrequestthatIMOshouldnowrevisittherequirements.
WhilethereisaformalmechanismintheIMOagreementtocompleteareviewby2018ofprogressmadetowardsmeetingthedemandfor0.5%sulphurfuelthatismeanttobeusedoutsideofECAsby2020,ICShasbeenpressingIMOtostartworknowondevelopingamethodologythatcanconsiderallofthemajorchangesrequiredbythenewregime.Forpoliticalreasons,theUSandEUgovernmentshavesofarbeenreluctanttosupporttheICSproposal.Butthisissueoffuelavailabilityisbecomingincreasinglypressing,andICSwillagainmakeaformalwrittenproposaltotheIMOMarineEnvironmentProtectionCommitteeinOctober2012.
IMOagreementtoreduceatmosphericpollutionfromships
Year 2005 2010 2015
1.5%
1.0%
0.1%
SulphurcontentoffuelpermittedinEmissionControlAreas
BallastWaterManagement
TheIMOBallastWaterManagement(BWM)Conventionwasadoptedwithgreaturgencybygovernmentsin2004,inordertoaddressenvironmentalconcernsaboutdamagetolocalaquaticecosystemscausedbytheunwantedintroductionofforeignmicro-organisms,whichisapparentlyfacilitatedbyinternationalshipping.
TheadoptionoftheBWMConventionwasaclassiccaseofaspirationallegislation.Forreasonsthatarewellunderstood,includingtheeconomicdamagetotheUSeconomyfromtheunwantedinfluxofzebramussels,therewashugepoliticalpressureforIMOtoadopttheConventioneightyearsago.Buttheequipmentneededtocomplywiththenewrequirements,andthecomplextechnicalguidelinesneededtoensureproperimplementation,hadnotthenbeendeveloped,whichiswhyitisonlynowthatgovernmentsarealmostinapositiontoratify.
FollowinganincreaseinthenumberofratificationsithadbeenexpectedthattheConventionwouldenterintoforceduring2012.However,atanIMOmeetinginJanuary2012,somemajorchangeswereproposedtoimportantdraftguidelinesonballastwatersamplingandanalysisthatwillbeusedbyportstatecontrolinspectors,whichwouldbeverydamagingtoshipownersifadopted.ICSmadeastrongstatementattheendoftheIMOmeetingaboutthedirectionthathadbeentakenand,supportedbymanyflagstates,thesedraftguidelineswillnowbereconsidered.However,thisnowmeansthatthesesamplingguidelineswillnotbeagreeduntilatleast2013,whichinturnisexpectedtofurther
Timetablefornewlimitstosulphurcontentinships’fuelagreedbyIMO
2010-EmissionControlArea(ECA)limitreducedto1%(from1.5%)
2012-Globallimitreducedto3.5%(from4.5%)
2015-ECAlimitreducedto0.1%
2020-Globallimitto0.5%butareviewin2018,withauthoritytodelayimplementation,willdeterminewhetherthisisachievable.
2025-Globallimitto0.5%notwithstandingtheresultofthe2018review.
16
![Page 19: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/19.jpg)
Reductioninnumberofmajoroilspillsperyear(over700tonnes)Source:ITOPF
1972-1981 1982-1991 1992-2001 2002-2011
250
200
150
100
50
0223 94 64 31
delaytheadditionalratificationsneededtobringtheConventionintoforce.ThiscreatesotherproblemsforshipownersduetothefixeddatesbywhichexistingshipshavetoinstalltheveryexpensivenewtreatmentequipmentasrequiredbytheConvention’stimeline.
Therearestillgenuineconcernsabouttheavailabilityofsuitableequipment,therobustnessofthetypeapprovalprocess,thehugeexpenseofretrofittingexistingships,andthepresentlimitedpossibilitiesfortreatmentsystemsforlargervessels.Thatsaid,progressisnowbeingmadetoapprovevariousballastwatertreatmentsystemsasanalternativetoballastwaterexchangeatseaoncethisisnolongerpermitted.
Completionofthisworkislongoverduegiventhatnewshipsarealreadymeanttobeconstructedwiththeseexpensivenewtreatmentsystems.ICShascontributedsignificantlytothisworkandcontinuestoprovideaconsultanttotheGESAMP(JointGroupofExpertsontheScientificAspectsofMarineEnvironmentProtection)BallastWaterWorkingGroupthathasbeenconductingthedetailedassessmentofthenewequipment’senvironmentalacceptability.Meanwhile,ICScontinuestoencouragefullco-operationwithlocalballastwaterexchangerequirementswhereveritissafeforshipstodoso.
SolongastheBWMConventionhasnotenteredintoforce,thiswillcontinuetoencouragethedevelopmentoflocalrequirementsthatareatvariancetothoseagreedbyIMO(seeseparateitemonUnitedStatesDevelopments).Thepossibilityremainsofballastwaterchaos.
ChangestoMARPOL
InadditiontothehighprofilediscussionsaddressingCO2andotheratmosphericemissions,awiderangeofotherenvironmentalissuesremainonIMO’sagendarequiringdetailedinputfromICS.AlargeproportionofICSresourcesiscommittedtoparticipatingintheongoingworkofnumerousIMOCommitteesandworkinggroupswhichareconstantlyupdatingenvironmentalregulationsandtechnicalcodes.
Meanwhile,atthe‘high’politicallevel,ICSplanstosupportIMOinitsparticipationatthe‘Rio+20’UnitedNationsConferenceonSustainableDevelopmentinBrazilinJune2012.ThiswillprovideauniqueopportunitytohighlightthesuccessthattheindustryandIMOhavehadindeliveringcontinuousimprovementinshipping’senvironmentalperformancethroughthedevelopmentofa
comprehensiveregulatoryframeworkandthewidespreadglobalenforcementoftheInternationalConventionforthePreventionofPollutionfromShips(MARPOL).InJuly2011,IMOadoptedchangestoAnnexVoftheMARPOLConvention,concerninggarbage,thatwillenterintoforceinJanuary2013.TheseweresupportedbydetailedguidelinesadoptedbytheMarineEnvironmentProtectionCommitteeinMarch2012.Thereisnowanewrequirementspecifyingthatdischargeofallgarbageintotheseaisprohibited,exceptwhereexpresslyprovidedotherwise(thedischargesstillpermitted,incertaincircumstances,includefoodwastes,cargoresiduesandwaterusedforwashingdeckandexternalsurfacescontainingcleaningagentsoradditiveswhicharenotharmfultothemarineenvironment).FollowingtheparalleladoptionbyIMOofnewGuidelines
17
RepresentingtheGlobalShipping
Industry
![Page 20: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/20.jpg)
onGarbageManagementPlansthatmustbecarriedonboardships,ICSwillbereviewingitsownmodelplanandbestpracticeguidelinesforshipowners.
Somewhatcontroversially,inJuly2011IMOalsoadoptedamendmentstoMARPOLAnnexIVconcerningthepreventionofpollutionbysewagefromships,whichincludethepossibilityofgovernmentsestablishing‘SpecialAreas’forthepreventionofsuchpollutionfrompassengerships,andwhichdesignatetheBalticSeaasthefirstsuchSpecialArea.TheimpactofpassengershipswithrespecttonitratepollutionoftheBalticiswidelyacknowledgedtobeinsignificantincomparisontomajorsourcesofpollutionsuchasagriculture.Theoperationalimplicationsofcomplianceandthedifficultiesoffindingsuitablereceptionfacilitiesareoutofallproportiontotheenvironmentalbenefit.Therealconcern,however,istheprecedentthismightcreatefortheintroductionofallsortsofotherMARPOL‘SpecialAreas’beingestablished,potentiallyapplyingtoallshiptypes.ICShasalreadyhadtocountersuggestionsthattheAnnexIVSpecialAreamightalsoapplytocargoshipswhichtypicallyhave20personsonboardasopposedto2,000.Thereisadangerthatsuchspecialpleadingbycoastalstatesmaygraduallyservetoerodetheconceptofatrulyglobalregulatoryframework.
ShipRecycling
ICSremainsfirmlycommittedtotheearlyentryintoforceoftheIMO(HongKong)ConventionontheSafeandEnvironmentallySoundRecyclingofShips,notleastthroughthepromotionoftheinter-industry
GuidelinesonTransitionalMeasuresforShipownersSellingShipsforRecycling,whosedevelopmentwasledbyICS.TheindustryGuidelinesarespecificallyintendedtohelpimprovesafetyandenvironmentalconditionsinrecyclingyardsinadvanceoftheentryintoforceofthenewConvention.
ICScontinuestoco-operateinanambitiousIMOprogrammetopromotethenewShipRecyclingConvention.InMarch2012,IMOadoptedfurtherguidelinesonimplementationforPartiessupportedbyguidelinesfortheauthorisationofshiprecyclingfacilities.ItisverymuchhopedthatthesewillnowbeappliedbythosegovernmentswithauthorityoverthevastmajorityoffacilitieswhicharelocatedinAsia.Theearlyidentificationofsoundrecyclingfacilitiesshouldgreatlyassisteffortsbyshipownerstomeettheirresponsibilitiesonavoluntary
basisinadvanceoftheHongKongConventionenteringintoforce.
ShipbuildingStandards
Themaintenanceofhighstandardsofshipconstructionisoftheutmostimportance.TheobjectiveofICSisthatshipbuildingstandardswillcontinuetobetakenforwardsothatwithanappropriatelevelofmaintenance,andadequatemarginsforcorrosion,futureshipswillbeconstructedsothattheywillcontinuetobe‘fitforpurpose’throughouttheirtypical25yearlifespan.
ICScontinuestoparticipateinacrossindustryinitiative,co-ordinatedbytheInternationalAssociationofClassificationSocieties(IACS)toprovideguidanceontheharmonisationandamendmentoftheCommonStructuralRules(CSRs)forbulkcarriersandtankers.Theintentionistoprovideaharmonisedsetofrules,forusebyallclasssocieties,oncommonaspectsofhullstructuredesign,supplementedbydedicatedsectionsonthespecificrequirementsforthesetwoshiptypes.IACShasbeenoverwhelmedbythehugenumberofcommentsreceivedfromshipowners,alargeproportionofwhichhaveleddirectlytoproposalsforrulechanges.Whilethecarefulattentionbeinggiventothisfeedbackfromindustryisverywelcome,itseemsthatthefinalisationofthenewrules,sothattheymaybesubmittedtogovernmentsatIMO(forusewiththeIMOGoal-basedStandardsinitiative)isnowlikelytobedelayeduntil2013.
CloselyrelatedtotheIACSCSRs,IMOcontinuestofinalisearrangementsfortheimplementationofthe2010amendmentstotheSOLAS
18
![Page 21: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/21.jpg)
Conventionconcerningthenew‘Goal-basedStandards’(GBS)fortheconstructionofbulkcarriersandoiltankersof150moroverinlength.IthasnowbeenresolvedthatclasssocietiesshouldpayfortheGBSverificationprocess,butquestionsremainastowhetherthereisanadequatenumberofsuitablyqualifiedauditors.
InChina,inOctober2011,theChairmanledanICSdelegationtothelatestroundof‘Tripartite’discussionsaboutshipbuildingstandardswithrepresentativeorganisationsofshipowners,classificationsocietiesandshipyards.Topicsconsideredincluded:measurestoreduceCO2emissionsincludingtheapplicationoftheEEDIandrequirementstoensuretheprovisionofadequateship’spower;thechallengespresentedbytheimplementationoftheIMOBallastWaterManagementandShipRecyclingConventions;andthereviewbeingundertakenbyIACSofitsCommonStructuralRules.ICSwillbeco-ordinatingthearrangementsforthenextTripartitemeetingtobeheldinKoreainNovember2012.
CargoSafety
Thetransportofgoodsbyshipmaysometimesinvolveahighdegreeofphysicalriskduetothedangerspresentedbytheharshconditionsthatoftenprevailatsea.Forthemostpartthesearerisksthatcanbesuccessfullyandsafelymanagedbyshipoperatorsandtheircrews.However,suchriskscanbeseriouslymultipliedwheninsufficientcareisgiventothesafeloadingofcargoes,afactorwhichissometimesbeyondshipowners’directcontrol.WhileIMOhasbeenverysuccessfulwithrespecttoensuringthatshipbuildingstandardsand
19
![Page 22: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/22.jpg)
safenavigationalproceduresarewidelyenforcedbygovernments,therigorousapplicationofIMOstandardsdoesnotalwaysextendsoeffectivelytothoseactionsthatoccurfarbeyondtheship/portinterface.
Thesefearshaverecentlybeenbroughthomeinamostdisturbingmanner.Thereisnowveryseriousconcern(andanger)throughouttheindustryabouttherecentlossofseveralshipscarryingnickelore/ironorefinesloadedinIndia,thePhilippinesandIndonesia,apparentlyduetocargoliquefactioncausingcargotoshiftdramatically.Somecargoes,itseems,arebeingdeliberatelymisdeclared.Especiallyupsettingwasthetragiclossof22seafarersonthe‘VinalinesQueens’afterloadinganickelorecargoinIndonesia,inDecember2011.ItmustbestressedthatsuchproblemsarenotconfinedtoAsia,withbulkcarrieroperatorsreportingthatthewatercontentofironorecargoesisbeingsimilarlymisdeclaredbyshippersinBrazil.
ICSacknowledgesthattheissuesarecomplex,buttherootoftheproblemwouldseemtobetherefusalofsomeshipperstoallowtheappointmentofindependentsurveyorstoconductcargotestinginaccordancewithIMOrequirements,plusthecommercialpressureplacedonMasterstoacceptpotentiallyunsafecargoesatwhatareoftenremotelocations.Thepreventionofsimilarincidentsisanutmostpriority.Inco-operationwithIMO,Intercargo(whichrepresentsbulkcarrieroperators)theInternationalGroupofP&IClubs,andthegovernmentsofthosenationswhereproblemsseemtoexist,ICSisendeavouringtohelpfindasolutionthatwillassistshipownersandMasterstoresistanypressuretoacceptunsafecargoes.
Meanwhile,containershippingcompaniescontinuetobeconcernedbytheincidenceofshippersprovidingincorrectcontainerweights,andtheneedtoensurethatmarineterminalsalwaysverifytheweightofloadedcontainersagainstthecargomanifest,priortoloadingonboardship.FollowingaproposaltotheIMOMaritimeSafetyCommitteemadebyICSandtheWorldShippingCouncil(WSC),IMOhasbeenconsideringhowitmightestablishanewinternationalregulatoryrequirementtoaddressthisproblem.
Theindustry’saimisthatallexportedcargocontainersshouldhavetheirweightsverified,andthatthisinformationshouldbeconfirmedbythemarineterminaluponreceipt,andbeforevesselloading,andmadeavailabletotheshipoperatorsoitcanbeusedforstowageplanning.Aswellasimprovingsafety,sucha
measurewouldhelptoaddresswidersecurityconcernsaboutthecontentofcontainers.Inawelcomemove,theInternationalAssociationofPortsandHarbors(IAPH)gaveitssupporttothisinitiativeattheendof2011.
Disappointingly,forreasonsnotentirelyclear,somegovernmentshavesofarbeenlukewarmabouttheindustryproposaltoamendtheSOLASConventionanditremainstobeseenhowtheconceptwillbetakenforwardduring2012.Butintheabsenceofarequirementthatcontainerweightsdeclaredbyshippersareverifiedbyterminalsitseemslikelythatasubstantialnumberofcontainerswillcontinuetobemisdeclaredandthatoverweightcontainerswillcontinuetoposeaseriousrisktosafeshipoperations,toships’crew,andtootherpersonnelinthetransportchain.
Totallosses1994-2011bynumberofvessels(over500GT)Source:IUMI
200
180
160
140
120
100
80
60
40
20
0‘94 ‘95 ‘96 ‘97 ’98 ‘99 ‘00 ‘01‘02 ‘03 ’04 ’05 ‘06 ‘07 ‘08 ‘09 ‘10 ‘11
20
RepresentingtheGlobalShippingIndustry
![Page 23: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/23.jpg)
TankerSafety
In2012,IMOwillbeapproachingtheendofamajorreviewoftankersafetythatissettoresultinsomeimportantregulatorychanges.ThiswasinresponsetoamajorreportbyanInterIndustryWorkingGrouponFiresandExplosionsonBoardTankers,towhichICScontributedwiththeOilCompaniesInternationalMarineForum(OCIMF)andIntertanko,andwhichwaspresentedtoIMOin2007followingasequenceofsometimesfatalexplosionsontankers.
ICShasplayedanactivepartinthediscussionsatIMOontheextensionofthepracticeof‘inerting’cargotankatmospheres.AtameetingoftheIMOFireProtectionSubCommitteein2011,animportantdecisionwasmadewithrespecttotheproposednewmandatoryrequirementsfortheinertingofchemicaltankers.Thenewcarriagerequirementswillapplytonewshipsover8,000dwt.InconjunctionwiththeInternationalParcelTankersAssociation(IPTA),ICShadhighlightedtheenvironmentalimpactofoperatingIGequipment,andhadindicatedthatacarriagerequirementforsub5,000dwtchemicaltankerscouldbeproblematic.TheIMOdecisionisthereforecompatiblewiththeICSposition.SubjecttotheadoptionofthenewregulationsbytheMaritimeSafetyCommitteeinMay2012,thisdevelopmentwillbeaddressedinaneweditionoftheICSTankerSafetyGuide(Chemicals)whichICSintendstofinalisein2013.
ICSfullysupportstheproposalstoamendSOLAStoprovidefortheapplicationofinertgas(IG)tonewoilandchemicaltankersabove8,000dwt.Itshouldbenoted,however,thatIMOdecidedthatthepossibleextensionofnewmeasurestoexistingtankersoflessthan20,000dwtwouldonlybe
21
![Page 24: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/24.jpg)
consideredinthelightofexperiencegainedfollowingintroductionofIGonnewshipsof8,000to20,000dwt.However,aseriousexplosioninKoreainJanuary2012whichinvolvedasmallchemicaltankermightputrenewedpressureonIMOtoaccelerateitsconsiderationofIGforexistingships,asmightamajorfireonboardachemicaltankerthatoccurredintheGulfduringMarch2012(whichinvolvedtheadditionaldramaoflocalportsrefusingtoprovideaplaceofrefugeforthestrickenship,contrarytoIMOGuidelines).
ItisimportanttorecallthatadisturbingconclusionoftheoriginalindustryreportthatinformedtheIMOreviewwasthatotherwisecompetentandqualifiedseafarersarestillpronetobypassacceptedproceduresduringcargooperations,andthatthishadbeenafactorinanumberofsometimesfatalexplosionsontankers.Thesolutionsarecomplex,involvingmattersthatdonotalwaysreadilylendthemselvestoprescriptiveregulations,suchashowtofurtherinculcateagenuine‘safetyculture’amongstships’crews,whichtheneweditionoftheICSTankerSafetyGuideChemicalswillseektoaddress.
MalaccaandSingaporeStraits
Eachyeartherearemorethan70,000transitsbyshipsthroughtheStraitsofMalaccaandSingapore,whichisoneoftheworld’smoststrategicallyimportantinternationalwaterways,linkingtheFarEasttotheIndianOcean,theMiddleEastandEurope.WhilewishingtohelpensurenavigationalsafetyandenvironmentalprotectionoftheStraits,thelongstandingobjectiveofICShasbeentoencouragethemaintenanceoftheprinciplesoffreedomofnavigation
governinginternationalwaterwaysasenshrinedintheUnitedNationsConventionontheLawoftheSea(UNCLOS),sothatindividualshipsarenotchargedforsafetyservices.However,thishashadtobereconciledwiththechallengefacedbythelittoralstatesofIndonesia,MalaysiaandSingaporeinfinancingnavigationalsafety.ICShasconductedadetailedsurveyofincidentreportswhichitisanticipatedwillresultinthedevelopmentofproposalstoenhancethemanagementoftrafficintheStraits.InOctober2011,ICSpresentedthereport’sfindingstothemaritimeadministrationsofthelittoralstatesatameetinginKualaLumpur.
Onlyaverysmallproportionoftransitsresultinaccidentsornearmisses.However,theICSsurveyhasidentifiedheavyshippingtraffic,inappropriatespeedandthelossofsituationalawarenessassignificantfactorsthatneedtobeaddressed.TheICSreportpraisestheskillandprofessionalismofthosemanaging,operatingandnavigatingshipsintheMalaccaandSingaporeStraits.However,itisimperativethatsafetycontinuestobeprioritised.ICShasthereforealsosuggestedthatimprovementscouldbemadewithrespecttothelocationofpilotboardingareasandthetimingofpilotdepartures.ThereisalsoconcernabouttheunderstandinganduseofnavigationsystemssuchasECDIS,AISandradar,bothatseaandashore.Oftheincidentsexamined,whichinvolvedarangeofvesselsfromtugstotankers,68%resultedincollisions.Encouragingly,thelittoralstateshavewelcomedtheICSreportandarealreadytakingmeasurestofurther
22
![Page 25: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/25.jpg)
23
RepresentingtheGlobalShipping
Industry
![Page 26: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/26.jpg)
improvenavigationalservicesintheStraits.InconjunctionwithICS,itishopedthattheywillmakeajointsubmissiontoIMO,advisingonthecurrentstatusofthisimportantwork.
Meanwhile,althoughithastakensomewhatlongerthanexpected,thelittoralstatesareabouttostartconductingseatrialsintheStraitswithrespecttoaMarineElectronicHighway(MEH),althoughanumberofissuesneedtoberesolvedsuchaswhetheranAIScomponentwillbeincorporated.WhileitisICS’sintentiontorequestthatshipsactivelyparticipateinthesetrials,thiswillnotbepossibleuntildetailedplanningiscompleteandtheinfrastructureisfullyinplace.ICShasstressedtheimportanceofstandardisationandinteroperabilitybetweenshorebasedcomponentsofe-navigationinordertoavoidshippinghavingtocommunicatewithunharmonisede-navigationresourcesindifferentgeographicalregions.ThequestionoffreeaccessduringthetrialstotheseMEHdataservices,inaccordancewithUNCLOSprinciples,alsostillneedstoberesolved.
E-NavigationandECDIS
ICSwelcomesthegreatpotentialofe-navigationforimprovingnavigationalsafety.However,ICScontinuestoemphasisetheneedfora‘userfocused’approach,sothate-navigationisnotdrivensolelybyideasfromequipmentmanufacturersortheavailabilityofnewtechnology.ICSiscurrentlyengagedindetaileddiscussionsatIMO,andalsowithintheInternationalAssociationofMarineAidstoNavigationandLightHouseAuthorities(IALA),abouttheimplementationofIMO’se-navigationstrategy.Thisincludesuserneedsandservices,andthe
technicalspecificationsofvariousshipboarddevices.Inparticular,ICSisstillseekingtoensurethatnationalauthoritieswillnotregardVirtualAidstoNavigationasacheapermeansofprovidingstatutoryservices,andthattheycontinuetobeseenasacomplementratherthanareplacementforphysicalaidstonavigation.Apressingissueconcernsarrangementsfortheintroduction,inJuly2012,ofthenewmandatoryIMOrequirementsforECDIS(ElectronicChartDisplayandInformationSystems),whichICShaslongsupportedprovidedthattheindustry’sdefinitionof‘sufficientElectronicNavigationChart(ENC)availability’canbemetbeforethephased-incarriagerequirementbecomeseffective.ICShasbeencloselymonitoringprogressattheInternationalHydrographicOrganization(IHO)towardsmeetingtheENCcoveragenecessarytomakethemandatorycarriageofECDISviable.
Inparticular,ICShasbeenengagedwiththeIHOandotherinterestedorganisationsindiscussionsoverpotential‘operatinganomalies’thathavebeenidentifiedwithECDIS.AtesthasbeendevelopedbyIHOthatallcompanieshavebeenencouragedtouseinordertodetectsuchanomalies.DisturbinglyithasbecomeapparentthatnotallECDISsystemsmaybefullyeffective,withathirdofthosetestedreportedlyfailingtodisplaysignificantunderwaterfeaturesinthe‘standard’displaymode.AtleastonemanufacturerhasconfirmedtoIHOthatearlierversionsofitsECDISwillnotdisplaysometypesofwreckandunderwaterobstructionsinanydisplaymode,necessitatingthecontinueduseofpapercharts.
InviewofconcernsaboutfullENC
coverageandECDISoperatinganomalies,ICSisalsoquestioningproposalsbyAustralia(andothergovernments)toamendtheSOLASConventionwiththeeffectofprohibitingtheoperationofECDISintheRasterChartDisplaySystem(RCDS)mode.Therearealsoworriesabouttheambiguityofsuggestednewrulesonupdatingrelevanthardwareonboardthatcouldimplythatshipoperatorsmightconstantlyhavetoreplaceveryexpensiveequipment.
WiththecarriageofECDISabouttobecomemandatory,ICScontinuestohighlighttheimportanceoftrainingseafarersinitsuse.ICShasthereforecontributedtotheproductionofguidanceonissuesofcompetencyandtrainingwhichhasbeenco-ordinatedbytheNauticalInstitute.ICShasalsosubmitteditsowndetailedproposalsonECDIStrainingrequirementstotheIMOSubCommitteeonStandardsofTrainingandWatchkeepingwhichmeetsinMay2012.ThesesuggestbestpracticerecommendationsforthetimingofdeliveryofECDIStrainingforbothnewandexistingseafarers,takingaccountofpresentrequirementsforupgradingtrainingascontainedinthe2010amendmentstotheSTCWConvention.
TrainingStandards
Thecompetenceofseafarersisamostcriticalfactorinthesafeandefficientoperationofships,andhasadirectimpactonthesafetyoflifeatseaandtheprotectionofthemarineenvironment.TheIMOConventiononStandardsofTraining,CertificationandWatchkeepingforSeafarers(STCW)constitutesacomprehensivesetofregulationsintendedtomaintainthehigheststandardsofcompetenceglobally.Inparticular,the
24
RepresentingtheGlobalShipping
Industry
![Page 27: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/27.jpg)
STCWConventionplacesimportantresponsibilitiesonmaritimeemployers.
InJanuary2012,widerangingamendmentstotheSTCWConventionenteredintoforce,havingbeenadoptedbyaDiplomaticConferenceinManilainJune2010.Withimmediateeffect,companiesarenowrequiredtocomplywiththenewSTCWminimumresthourprovisionsforseafarers(seepage27).Manyoftheothernewrequirementswillbephased-inbetweennowand2017.SomegovernmentsarenowexpectedtobeginapplyingthenewSTCWrequirementsonanationalbasis,suchasenhancedfiveyearlyrefreshertraining,orthenewmandatoryrequirementsfortheonboardtrainingofratingstobedocumented.ThisincludestrainingforthenewSTCWgradesofAbleSeafarerDeckandAbleSeafarerEngine,whichmanyflagstatesareexpectedto
requireexistingratingstoundergoinordertocomplywiththeirminimumsafemanningrequirements.
FromJanuary2013,allnewseafarerscommencingtrainingwillberequiredtodosoinaccordancewiththenewtrainingandcompetencestandardsinSTCW2010.However,until2017governmentsmaycontinuetorenewandrevalidateexistingcertificatesinaccordancewithcurrentSTCWprovisionswhichappliedimmediatelypriortoJanuary2012.
NumerousamendmentswereadoptedbyIMOtotakeaccountofrecenttechnicaldevelopmentsrequiringnewshipboardskills,suchastheuseofElectronicChartDisplayandInformationSystems(ECDIS)ortheneedtogivemoreemphasistoenvironmentalmanagement.Butthechangesalsocoversuchmattersasnewtrainingrequirementsforleadershipandteamwork,enhanced
refreshertrainingforqualifiedseafarers,aswellastheintroductionofdetailedstandardsofcompetenceforthenewgradeofAbleSeafarermentionedabove.Therearealsonewcompetencetablesandtrainingrequirementsforpersonnelonoilandchemicaltankersandgascarriers.
Althoughnotadirectresponsibilityofcompanies,theindustrywillwishtoensurethatasmanygovernmentsaspossiblecomplywiththerevisedrequirementstoreporttoIMOtheactionsthathavebeentakentoimplementthenewSTCWstandards.Thiswillbenecessary,byJuly2013,ifgovernmentswishtomaintainaplaceontheIMO‘whitelist’ofnationsthathavedemonstratedcontinuingadherencetoSTCWstandards,soastoavoidportstatecontroldifficultiesfortheirships,orflagstaterecognitionproblemsforseafarersworkingonforeignshipstowhomtheyhaveissuedSTCWcertificates.
25
![Page 28: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/28.jpg)
ICSanticipatesthattheremaybeaneedtoclarifytheinterpretationofhowsomeofthenewstandardsaretobeapplied,forexamplewithregardtohownewrefreshertrainingshouldbeimplemented,deliveredandassessedorwhenthenewsecuritytrainingrequirementsenterintoforce.Thereisalreadyevidencethatsomemaritimeadministrationsmaybeintendingtoapplythenewrequirementsoverzealously.
TheoverridingobjectiveofICSanditsmembernationalshipowners’associationsisthatthestandardsrequiredbytheSTCWConvention,asamendedin2010,areputintoeffectassoonaspossible,andthatthehigheststandardsofseafarercompetencewillcontinuetobemaintainedworldwide.In2011,ICSthereforepublishedaneweditionoftheISFGuidelinesontheIMOSTCWConventiontoadviseshippingcompaniesandshipboardpersonneloftheirfundamentalobligationsasrequiredbythe‘Manilaamendments’.Aswellasprovidingadviceoncompliance,theGuidelinesalsogivebackgroundinformationonthephilosophyunderlyingthecompetence-basedapproachtotrainingwhichtheSTCWConventionseekstopromote.
In2012,ICSaimstocompleteitsambitiousscheduleofrevisingitswidelyusedISFonboardtrainingrecordbookstotakeaccountoftheManilaamendments.UpdatedOnBoardTrainingRecordBooksfordeckandengineratings(includingthegradesofAbleSeafarerDeckandEngine)havealreadybeenpublished,andrevisedtrainingrecordbooksfordeckandengineofficertraineesshouldbepublishedinthefirsthalfof2012.ICS/ISFiscurrentlyindiscussion
26
![Page 29: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/29.jpg)
withmajorlaboursupplynationssuchasthePhilippinesabouttheuseandapprovaloftheupdatedbooks.
AsaresultoftheSTCWamendments,employersshouldnowgenerallyhavefargreaterconfidenceinthevalidityofseafarers’certificates,regardlessofthecountryofissue.Thisisnottosaythatquestionsaboutthequalityoftraininginmanytraininginstituteshavebeeneradicatedcompletely.However,thereisnowaclearersensethatallseafarersworkinginternationallyarepartofthesameglobalprofession,inwhichtheparamountimportanceofsafetyoflifeatseaandtheprotectionofthemarineenvironmentisfarmorewidelyrecognised.
WorkHourRegulations
Thepreventionoffatigueamongstships’crewsanditspotentialimpactonsafetyisamajorpriorityfortheindustryanditsregulators.InJanuary2012,asaresultoftheentryintoforceofChapterVIIIoftheIMOSTCWConvention,newandstricterregulationscameintoforcegoverningseafarers’hoursofrest.Theminimumrestthatmustbereceivedinany7dayperiodisnow77hoursratherthan70hoursandtheflexibilitypreviouslypermittedbythe‘2dayderogation’ruleundertheIMOruleshasnowbeenremovedsothatseafarersmustalwayshave10hoursrestinany24hourperiodwithnoexceptions(apartfromduringemergencies).Amostimportantrequirementisthatshippingcompaniesarenowrequiredtomaintain,onamandatorybasis,individualrecordsofseafarers’hoursofworkandrestthatmaybesubjecttoinspectionbyportstatecontrol.
TherationaleforthenewSTCWrequirements,whichwereadoptedin2010,wastoensurethattheIMOrequirementsarecompatiblewiththosecontainedintheILOMaritimeLabourConvention(MLC)onceitentersintoforce.ThetaskofIMOwascomplicatedbecausetheregimesadoptedbyIMOandILOweredevelopedfordifferentpurposes.STCWprescribesminimumresthoursfromthesafetyperspective,whiletheILOConventionalsotakesaccountofsocialissues,suchasthepointatwhichadditionalpaymentsforovertimeshouldnormallybemadeandtheextenttowhichworkhoursmaybesubjecttonegotiationbetweenemployersandunionsincollectivebargainingagreements-issuesoutsidetheremitofIMO.
ICSissatisfiedthatthechangestominimumresthoursagreedbyIMOarefullycompatiblewiththeILOrequirements,althoughinpracticetheyaresomewhatstricter.Inreality,giventhattheSTCWamendmentshavealreadyenteredintoforcetheyarelikelytobecomethedefaultregimeforportstatecontrolinspectors.AnimportantaspectofSTCW2010isthesocalled‘Manilaexception’clauseswhichcontinuetopermitoccasionaldeviationfromthenormalminimumresthoursprovidedcompensatoryrestisprovided.Whilelackingtheflexibilityoftheold‘2dayderogation’rule,thiswillallowsomeflexibilityduringperiodsofpeakworkload,particularlyimportantforshortseaoperators.However(withtheexceptionofemergencies)allseafarersarenowprohibitedfrombeingondutyformorethan14hourswithinany24hourperiod.
Manycompaniesarenowensuringthattheyaremaintainingaccurate
recordsofthehoursofworkandrestonboardshipbyusingtheISFWatchkeepersoftware,which,aswellasproducingindividualseafarer’srecordsintheformatrecommendedbyILOandIMO,allowscompaniesandcrewstoensurethattheycomplyfullywithboththeILOandIMOlimits.AnupgradedversionofISFWatchkeeperVersion3,whichallowsaccounttobetakenofthenewIMOSTCWresthourlimits,waslaunchedduring2011.
EmploymentRelations
Anunusualfeatureofinternationalshipping,whichobserversfromoutsidetheindustrysometimesfindsurprising,isthatthereisapowerfulandglobalseafarers’tradeunionintheformoftheInternationalTransportWorker’sFederation.TheITFhasadirectimpactonseafarers’employmentandworkingconditionsonaworldwidebasis.Whetheremployerslikeitornot,theITFisprobablyasrelevanttodayaswhenitwasfoundedover100yearsago,althoughtheemploymentconditionsenjoyedbyseafarersin2012areofcoursegreatlyimprovedandcompareextremelyfavourablytothosewhichtheywouldreceiveinsimilarjobsashore.
Atthe2011AnnualGeneralMeetingsofICSandISF,thedecisionwastakentofullyintegratethetwoassociations.However,theInternationalShippingFederationistheidentitywhichICSwillcontinuetousewhenaddressinglabourrelationsquestionsasa‘partisan’employer’sorganisation.AspartofamajorstrategicreviewwhichledtothedecisiontointegrateICSandISF,oneoftheimportantissuesidentifiedwastheneedtostrengthendialoguewithITFatbothstrategicandworkinglevels.The
27
![Page 30: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/30.jpg)
aimofmembernationalshipowners’associations,whichhavetheirownrelationshipswiththeirnationaltradeunionsthatareaffiliatedtoITF,istobeactivelyco-operativeonnon-contentiouspracticalmatters,buttostandfirmwhenrequired.
ISFhasalongstandinginstitutionalrolewithITFasitsofficial‘socialpartner’attheInternationalLabourOrganization(ILO),andhascommoncausewithITFnationalunionaffiliatesonmanyissuessuchaspiracyandtheunwarrantedcriminalisationofseafarers,aswellasmattersrelatingtotheregulationofsafetyandhighqualitytraining.Inthesphereofemploymentrelations,however,thecharacteristicrelationshipbetweenISFandITFhassometimesbeenmoreconfrontational,primarilyduetoITF’s‘FlagofConvenienceCampaign’againstopenregisters,anditsinsistencethatshipoperatorspayITFminimumwageratesinthefaceofthethreatofboycottactionbyitsdockworkeraffiliates.
Inrecentyears,however,lessemphasisperhapsthanhithertohasbeengiventothismoredifficultaspectofrelationswithITF.InpartthishasbeenduetothepositivefocusgivenbybothsidestothesuccessfuldevelopmentoftheILOMaritimeLabourConventionanditssubsequentimplementation.TherelationshipbetweenISFandITFhasalsoevolvedduetotheemergenceoftheInternationalMaritimeEmployers’Committee(IMEC),whichcomprisesindividualcompanies,andisnowanassociatememberofISF/ICS,andtheestablishmentoftheInternationalBargainingForumwhichconductsinternationalwagenegotiationswithITF.ISF’shistoricrefusaltonegotiatedirectlywithITFaboutseafarers’
![Page 31: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/31.jpg)
termsandconditions,whichisamatterforindividualcompaniesandtheirnationalassociations,isthereforelessofanissue.RelationswithITFhavealsoimprovedfollowingtheresumptionofdiscussionsattheILOJointMaritimeCommissionaboutarevisionoftheILOMinimumWageforAbleSeafarers(seepage30).InMay2012,inordertoexploremeansoffurtherimprovingco-operation,ISFheldahigh-levelmeetingbetweenseniorrepresentativesofnationalshipowners’associationsandITFunionaffiliatesinLondon,thefirstsuchmeetingoutsideoftheinstitutionalsettingoftheILOforover10years.ItishopedthatthiswillbefirstofseveralmeetingsatwhichISFandITFmemberswillbeabletoidentifyissuesonwhichtheycancollaboratemoreeffectively,whilemaintainingdialogueonthosemattersonwhichtheremaystillbefundamentaldifferencesofapproach.
MaritimeLabourStandards
Forthelargemajorityofseafarers,employmentconditionsatseaalreadymatch,orinmostcasescomfortablyexceed,thosethattheycouldobtaininshorebasedemploymentathome.However,themaintenanceofgoodemploymentconditionsiscrucialtotheindustry’sabilitytoattractandretainthecompetentandwellqualifiedseafarersonwhomitdepends.
Followingratificationbyagrowingnumberofflagstatesincludingthemajoropenregisters(26ofthe30nationsrequired,atthetimeofwriting)theILOMaritimeLabourConvention(MLC)isexpectedtoenterintoforcegloballyverysoon,probablyduring2013.Therequired
tonnagethresholdhasalreadybeenachievedandcompaniesthereforeneedtobereadytoensurefullimplementationandcompliancewiththeMLCstandards.
TheILOMLCaddressesawiderangeofmattersincluding,amongstothers,theobligationsofshippingcompanieswithrespecttoseafarers’contractualarrangements,theresponsibilitiesofmanningagencies,workinghours,healthandsafety,crewaccommodation,cateringstandards,andseafarers’welfare.Asanofficialsocialpartner,underthetripartiteILOprocess,ISFwasresponsiblefornegotiatingthetextoftheConventiononbehalfofmaritimeemployers,withgovernmentsandseafarers’tradeunions.ISFthereforehasaveryspecialinterestinwantingtoassisttheConvention’ssmoothimplementation.
AnimportantaspectoftheConvention’senforcementwillbetheissuancebyflagadministrationsofMaritimeLabourCertificates,usuallyfollowinginspectionbyaRecognizedOrganizationsuchasaclassificationsociety,appointedbytheflagstate.ThereisalsoaseparaterequirementforshipstomaintainaDeclarationofMaritimeLabourCompliance.Importantly,compliancewiththeMLCwillbesubjecttoportstatecontrolaswellastoinspectionbyflagadministrations.
InDecember2011,inGeneva,ISFco-ordinatedshipownerrepresentationatamajortripartitemeetingofgovernments,employersandunionswhichagreedtermsofreferenceforaSpecialTripartiteCommitteethatwilloverseeproposalsforamendmentstotheILOMLConceitentersintoforce.TheChairman
oftheISFLabourAffairsCommittee,ArthurBowring(HongKong)servedastheemployers’spokesman,supportedby25delegatesfromnationalshipowners’associations.
ThevastmajorityofcompaniesshouldnothaveanydifficultycomplyingwiththesubstanceoftheConvention,sincethisislargelyderivedfromexistingILOmaritimestandardsandacceptedgoodemploymentpractice.However,theenforcementmechanismisnew,anditwillbeimportanttoavoidteethingproblemsassomeofthemoredetailedrequirementsareappliedandinterpreted.
Duringthecourseof2012,ISFexpectstopublishanupdatededitionofitsGuidetotheMLC.ThefirsteditionwasproducedshortlyaftertheMLCwasadoptedin2006,andsoughttointroduceshipoperatorstotheirobligationsunderthenewregime.Intheinterveningperiod,muchworkhasbeendonebyseveralILOtripartiteworkinggroups,comprisinggovernments,unionsandnationalshipowners’associationstoensurethatallconcernedunderstandtheirresponsibilities.ThissecondeditionhasthereforebeenupdatedtotakeaccountoftheserecentclarificationsfromILO.AdditionalguidancehasalsobeenaddedinordertohelpmaritimeemployersapplytheILOstandardsinapracticalmanner.ItishopedthatthesecondeditionoftheISFGuidewillproveusefulinassistingshippingcompaniesinpreparingfortheimplementationoftheMLCbygovernments,whetherintheircapacityasflagstates,portstatesorlaboursupplynations.ISF’sintentionistopromoteandhelp
29
![Page 32: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/32.jpg)
deliverthegloballevelplayingfieldofdecentmaritimelabourstandardsthatboththeshippingindustryandseafarersrequire.
ILOMinimumWage
Abouttwothirdsoftheworld’s1.5millionmerchantseafarerscomefromdevelopingcountries.Whilewageratesarecommonlyaffectedbyaseafarer’scountryofresidence,theshippingindustrygenerallyprovideshighlevelsofremunerationtoallthoseemployedatsea.Indeed,theshippingindustryisprobablyuniqueinthatithasamechanismforrecommendingminimumacceptableinternationalwagerates.
TheMinimumWageforAbleSeafarersisagreedbytheInternationalLabourOrganization(ILO)JointMaritimeCommission(JMC)whichcomprisesrepresentativesofnationalshipowner’sassociationsandseafarers’unions.ISF(theidentityusedbyICSwhenactingasanemployers’organisation)istheco-ordinatoroftheEmployers’GroupattheJMCwhiletheInternationalTransportWorkers’Federation(ITF)co-ordinatesseafarers’representation.UnlikeotherILOinstitutions,theJMCisbipartiteanddoesnotinvolvegovernments.InJanuary2012,theILOMinimumWageforAbleSeafarersincreasedtoUS$555amonthfromthepreviousfigureofUS$545whichhadcomeintoeffectin2009inlinewithanearlierscheduleofagreedincreases.ThislatestincreasefollowedanagreementbytheJMCwhichmetinGenevaattheendofApril2011.Inreality,theJMChasagreedafouryeardealwherebytheILOminimumwagewillincreasetoUS$568for
2013andUS$585for2014,withnofurtherrevisionexpectedtotakeeffectuntilatleast2015.Thiswillhopefullyprovideemployerswiththestabilitytheyneedduringthedifficulteconomiccircumstancesanticipatedintheyearsahead.
ISFbelievesthatthenewILO
ILOheadquartersinGeneva
wagefiguresarerealisticgiventhecontinuinguncertaintycreatedbytheglobaleconomiccrisis.ISFhadpreviouslyexplainedtoITFthatemployerssimplycouldnotagreetoanyimmediatefurtherincreases.However,whilemanyunionsrecognisedtheneedtohelpsafeguardemploymentforseafarers,some
30
RepresentingtheGlobalShippingIndustry
![Page 33: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/33.jpg)
unionswereclearlydisappointedbythisresponse.TheJMCthereforeagreedtoadoptascheduleofincreasesthatwillapplyuntil2015.
ISFremainsstronglycommittedtotheprincipleoftheILOMinimumWagerecommendationwhichisnowreferencedinthenewILOMaritimeLabourConvention,althoughithasinfactexistedforover50years.Whileitisonlyrecommendatory,andisnotdirectlyrelevanttootherseafarergrades,ithasastrongmoralauthorityandisparticularlyimportantforemployersindevelopingcountries.TheILOMinimumWagealsoinfluencesmanycollectivebargainingagreements,includingthoseenforcedbyITF,andissometimesreferredtoinlegalrulings.
TheILOMinimumWageissubstantiallyhigherthanthatpaidforcomparativeworkashoreindevelopingcountries.Moreover,theactualminimumwageissignificantlyhigher,typicallyperhaps50%more,onceovertimehours(fixedataminimumofoneandaquartertimesbasicpay)andothermandatoryILOrequirements,suchaspaymentsforleaveentitlements,aretakenintoaccount.Itisalsoonlyaminimum.Mostratingsfromdevelopingcountriesreceivesignificantlymore,whileofficersreceivesubstantiallymore,withdifferentialsbetweenofficersfromOECDanddevelopingcountriescontinuingtonarrow.
AsianDevelopments
Toacertainextent,somepartsoftheshippingindustryhavebeenshieldedfromtheeffectsoftheglobaleconomicslowdownbycontinuinggrowthinAsia,drivenespeciallybyChina’sinexorableexpansionanditsseeminglyinsatiabledemandforrawmaterials.However,inearly2012,Chinaannounceditsintentiontosubtlyrebalanceitseconomy,withlessemphasisonmassivefurtherinfrastructuregrowthandaredirectionofresourcesintoincreasedpersonalconsumption.WhileChinaisstillexpectedtocontinuetogrowatanimpressiverate,thisshiftinpolicycouldeventuallyhaveimplicationsforthefutureexpansionofChina’sdemandforshippingservices.Inthelongerterm,moreover,ithasalsobeensuggestedthataswagedifferentialsbetweenChineseworkersandthoseinotheremergingeconomiesreduce,theremayarelocationofmanufacturingtowardsLatinAmericaand,inparticular,toMexicowithitscloseproximitytotheUnitedStates.Moreimmediately,however,withmostoftheEurozonenowinrecessionthecurrentconcernisthatthisislikelytohaveadirectimpactonmaritimetradeastheimportofChineseproductsisreduced.
Ontheregulatoryfront,AsiannationsgenerallyhaveatrackrecordofbeinglessinclinedtowardstheadoptionofunilateralshippingregulationsatvariancewithinternationalstandardsagreedbyIMO.However,oneissuethatICShasbeenfollowingcloselyhasbeentheChinaPollutionRegulations.TheRegulationscameintoeffectin2010andintroducednewoperationalandliabilityrequirementsforshipowners.Implementationoftherequirement
tocontractwithlocalShipPollutionResponseOrganisations(SPRO)inordertoenterChineseportscommencedfrom1January2012andwasenforcedinallportsfromMarch.InNovember2011,attheinvitationoftheInternationalGroupofP&IClubs,ICSandrepresentativesoftheChinaandHongKongShipowners’AssociationsmetwiththeChineseMaritimeSafetyAgencyinBeijing.Shipowners’concernsabouttheabilitytocomplywiththerequirementtopre-contractwithanapprovedSPRObytheinitial1January2012implementationdatewereconveyed,alongwithconcernsabouttheveryhighSPROretainerfeesthathadbeenquoted.Theinitialimplementationprocesshasbeenproblematicbutitishopedthatitwillbesmoothergoingforward.
ItisgenerallyacceptedthatthecentreofgravityoftheshippingindustryismovingtowardsAsia.ApositivedevelopmentisthatAsianmaritimeadministrationshavebecomeincreasinglyconfidentandarticulatewhenpresentingtheirviewsatforasuchasIMO,notleastonissuessuchastheregulationofCO2.Inparticular,ICShasfoundcommongroundwithChinawithrespecttoitsemphasisonefficiencyimprovements,asopposedtosettingabsolutetargetsforemissionreductionsasfavouredbytheEU.IndiahasalsomadeanimportantcontributiontothedebatebywarningofthedangersofCO2regulationbeingappliedasaformofgreenprotectionism.Inawelcomemove,inDecember2011,IndiaratifiedAnnexVItotheMARPOLConventiongoverningatmosphericemissions,whichalsoincludesthetechnicalandoperationalmeasuresforCO2reductionagreedbyIMOinJuly2011.
31
![Page 34: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/34.jpg)
Asreportedelsewhere,ICShaswelcomedthepragmaticapproachofAsianauthoritiestowardsthedevelopmentofmaritimecompetitionregulation.Thisincludestheadoption,inJune2011,ofguidelinesconcerningnon-ratefixingagreementssuchasconsortia,bytheAsiaPacificEconomicCo-operationforum(APEC)whichisbecomingincreasinglyactiveonmaritimeissues.
ICScontinuestoenhanceitsgoodrelationswiththeAsianShipowners’Forum(ASF)whosemembershipcomprisesnationalshipowners’associations,manyofwhichalsobelongtoICS.Asasignofthisincreasingco-operation,ASFhasparticipatedinrecentmeetingswiththeConsultativeShippingGroup(CSG)ofmaritimeadministrationsorganisedbyICS,whiletheASFSecretaryGeneralnowattendsICSBoardmeetings.InMay2012,inAustralia,theASFAnnualMeetingwillforthefirsttimebeheldback-to-backwiththatofICS.
EUDevelopments
During2012,thesituationinEuropeisexpectedtobedominatedbythe
continuingcrisiswithrespecttothelongtermviabilityoftheEuro.ThishasbeenbroughtaboutbythedivergingeconomiccircumstanceswithinindividualEUMemberStates,notleastwithrespecttoincreasingunsustainablelevelsofsovereigndebt.EUleaders,innumerouscrisissummits,havesoughttorespondbyprovidingsupporttofailingeconomiessuchasGreece,aswellaspumpinghugeamountsofmoneyintotheEurozonebankingsectorasawhole.However,thejuryisstilloutonwhetherthe
singlecurrencywillweatherthestormandholdtogetherinthelongerterm.WhilethecurrentrecessionintheEurozonewillalmostcertainlyhaveanegativeimpactonglobalshippingmarkets,iftheEurozonecrisisworsenstheeffectontheworldeconomycouldbeveryseriousindeed.Moreimmediately,however,theEuropeandebtcrisisalsomeansthatamajorsourceofshipfinancinghasvirtuallydriedup,withmostofthemajorshippingbanksbeinglocatedinEurope.
DespitethepoliticalandeconomicturmoilinEurope,theEUinstitutionsremaincommittedtotakingforwardtheiragendawithrespecttomaritimeregulation.Inco-operationwiththeEuropeanCommunityShipowners’Associations(ECSA),ICSseekstoensurethatproposalsinEuroperemaincompatiblewiththeglobalmaritimeregulatoryframeworkwhichtheshippingindustryrequires.
NotwithstandingIMO’sachievementinadoptingapackageofinternationalregulationstoreduceshipping’sCO2emissions,theEuropeanCommissionisproceedingwiththedevelopmentofregionalmeasuresforshippingintheeventthatIMOisunabletoreachagreementonMarketBasedMeasures.Whilethisdecisionisdisappointing,thetimescalefortheimplementationofsuchmeasuresisbelievedtobefiveyears,andtheCommissionisunderstoodtoremainseriousinitspreferenceforaglobalsolutiontobeagreedatIMO.Nevertheless,inconsultationwithECSA,ICShassubmittedcommentstoaformalconsultationbyDGClimateAction,disputingtherationaleforaregionalregimeandreiteratingoppositiontotheinclusionofshippingintotheEUEmissionsTradingScheme(ETS).Inpublic,theEuropeanCommissionis
32
RepresentingtheGlobalShippingIndustry
![Page 35: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/35.jpg)
stillopenmindedaboutapplyingtheETStoshipping.Buttheapplication,inJanuary2012,ofaregionalETStointernationalaviation,hasnotbeenapleasantexperiencefortheCommissionwhichhashadtofacevigorousoppositionfromtheUnitedStatesandChina,amongstothers,whohaveindicatedtheymaytakeretaliatorymeasuressuchascancellingordersforEuropeanaircraft.ItremainstobeseenwhethertheEUwillbackdownwithrespecttoaviation,butifitshoulddosoitisdifficulttoseehowanETScouldthenjustifiablybeappliedtoshipping,whichunlikeaviationalreadyhasaninternationalagreementinplacethatwilldramaticallyreduceemissions.
AsdiscussedelsewhereinthisAnnualReview,otherimportantEUfilesinclude:thedraftDirectiveontheimplementationoftheIMOregulationsonsulphuremissions,whichmayincludetheextensionofEmissionControlAreas;itsresponsetothe‘CostaConcordia’cruiseshipdisaster,andtheimplementationoftheEUPassengerLiabilityDirective;andtheongoinginvestigationbytheCompetitionDirectorateoftheInternationalGroupofP&IClubs.ThecontinuingcommitmentoftheEUtocounter-piracyoperationsintheGulfofAdenisalsomostimportantandisgreatlyappreciatedbytheinternationalshippingindustry.
AnothermostimportantissueisthecurrentreviewoftheEUStateAidGuidelinesfortheMaritimeSectorwhichwilldecidewhethertopermitthecontinuationoftonnagetaxregimesinEurope.ThereviewisimportantbecauseEUtonnagetaxschemeshaveprovidedamodelforsimilarregimesthatarenowappliedbygovernmentsthroughoutthe
![Page 36: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/36.jpg)
world,andarevitalforshippinginorderforittooperateinwhatarevolatileandhighlycyclicalglobalmarkets.However,thereviewiscomplicatedbecauseitisbeingoverseenbytheCompetitionDirectorateratherthanDGMOVEashaspreviouslybeenthecase,theformerperhapsnotbeingsofamiliarwiththeuniquecircumstancesthatapplytoshipping.AttherequestofECSA,ICSisthereforesubmittingcommentstotheCommissioninfavourofthemaintenanceofthestatusquo.
USDevelopments
UnlikeEurope,theUSeconomyisshowingsignsthatitisbeginning
torecover,althoughwhetherthiswillbesustainedfarbeyondthePresidentialelectioninNovember2012isunknown,asistheextenttowhichthiswillfeedintoincreasingdemandforshipping.AninterestingdevelopmentisthattheUnitedStatesisgraduallyreducingitsdependencyonforeignenergysuppliesasitdramaticallyincreasesitsexploitationofshalegas.InNovember2011,theAdministrationalsoannounceditsproposedfive-yearplanforoffshoreoildrillingwhichcalledfortheopeningofnewareasintheGulfofMexicoandAlaska.Anotherinteresting‘knownunknown’istheimpactthattheexpansionofthePanamaCanal(whichisduetobecompletedin2014)willhaveonUSshippingtrades,especiallycontainers.Inviewoftherun-uptothePresidentialelections,legislativeactivitywithinCongressisexpectedtobelimited,althoughUSFederalregulatoryagenciesstillhaveafullagenda,whileindividualUSStates
continuetoseektoimplementrulesatvariancetobothFederalandinternationalrequirements.Indeed,onecharacteristicoftheObamaAdministrationthathasbeenasourceoffrustrationforshippinghasbeentheapparentreluctanceofthecurrentUSAdministrationtodefendFederalregulationsfrominfractionsbyUSStates.ApositivedevelopmentinApril2012wasthepublicationbytheUSCoastGuardofitsfinalrulemakingonballastwatertreatment,whichadoptsa‘killstandard’formarinemicro-organismswhichmatchesthatadoptedintheIMOBallastWaterManagementConvention.However,seriousquestionsremainastowhethertheUSstandardsfortypeapprovalofequipment(inlinewithitsEnvironmentalTechnologyVerificationProgram),ortheballastwatersamplingstandardsthatwillbeusedtoinspectshipstradingtotheUS,willbeconsistentwiththoseexpectedtoadoptedbyIMOin2013.ThedoorisalsostillopenfortheCoastGuardtointroducemorestringenttreatmentstandardsifitisestablishedthatthetechnologyhasbecomeavailableinthefuture,whichwillbeofconcerntothoseshipownersinvestingmoneyintoexpensivetreatmentequipmentnow.Moreover,theproblemremainsofsomeindividualUSStatesstillconsideringtheimplementationoftreatmentstandards100timesmorestringentthanwhathasbeenagreedatIMOandforwhichtheequipmentrequiredsimplydoesnotexist.
ICSisalsoengagedintheongoingsagaofCalifornia’sunilateralairpollutionrules,whichincontraventiontoUNCLOSapplytoshipswithin24milesoftheUSCoastevenifnotcallingataCalifornian
port,andarestillsubjecttolegalchallengebythePacificMaritimeAssociation.However,followingUSratificationoftheIMOMARPOLrequirementsonsulphuremissionsfromships,itishopedthatthetemptationforindividualUSStatestodeveloptheirownenvironmentalruleswilldiminish.
AparticularexampleofunwelcomeregulationadoptedbyanindividualUSStateisthatadoptedbyMassachusetts.ThisstipulatesthatvisitingtankersthatdonotelecttocomplywithcertainadditionalrequirementswillbesubjecttofinancialliabilitiesinexcessofthosesetoutinFederallawintheeventofapollutionincident.TheissueforICShasbeenoneofprinciple,duetotheencouragementthatthiscoercivelawmightgivetootherUSStatestotaketheirownunilateralactions,whichwillresultinconflictingregulations.Inco-operationwithotherindustryassociations,ICShasthereforebeeninvolvedwithalegalchallenge.TheintentionoftheactionwastomaketheUSCoastGuarddefenditsownregulations.Disappointingly,however,theCoastGuardhassofarshownlittleinterestindoingthisforwhatareprincipallyassumedtobepoliticalreasons.
TradeSanctions
Oneofthemajorpoliticaldramasbeingenactedin2012istheactionbeingtakenbytheinternationalcommunityinresponsetoIran’snuclearprogramme.Inaworstcasescenario,tensionintheMiddleEastcouldleadtoclosureoftheStraitsofHormuzthroughwhichsomuchoftheworld’soilpasses,withdramaticeffectsonoilpricesandtherecoveryoftheworldeconomy.However,theimmediatepreoccupationforICS
34
![Page 37: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/37.jpg)
35
RepresentingtheGlobalShipping
Industry
![Page 38: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/38.jpg)
RepresentingtheGlobalShippingIndustry
![Page 39: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/39.jpg)
hasbeenthechallengepresentedbysanctionslegislation.
Inco-operationwiththeInternationalGroupofP&IClubs,ECSAandtheChamberofShippingofAmerica,ICShassoughttoprovideinformationvianationalassociationsabouttheimpactonshippingcompaniesofsanctionsagainstIranannouncedbytheEuropeanUnionandtheUnitedStates.Itremainstobeseenwhetherotherimportanttradingnationswillintroducesimilarsanctions.
Thereisundoubtedlyaneedforgovernmentstoprovidegreaterclarityanduniformitywithrespecttotheapplicationofsanctions,whetherinthecontextofIranorothernations,suchasSyria,towhichtheymightbedirected.Thesituationisnothelpedbythefactthatgovernmentsnodoubtwanttheirsanctionslegislationtobeasambivalentandflexibleinitsinterpretationaspossible,inordertofurthertheirforeignpolicyobjectives.ThesanctionssofarenactedagainstIranhaveanimpactfarbeyondEUorUSoperators,evenforshipsflaggedinandtradingtocountriesoutsidetheEUandUS.Thisisbecausemostmarineinsurance(andreinsurance)isbasedinLondon;whileUSlegislationwillpreventtankeroperatorsthatcallinIranfromtradingtotheUS.
AlthoughmanyquestionsraisedbyshipownershavebeenaddressedbyextensiveadviceproducedbytheInternationalGroupofP&IClubs,thereisstillsomeuncertaintyastotheprecisescopeofthesanctions,particularlywithregardtotheirimpactoncompulsoryinsurancecoverasrequiredbytheCivilLiability(CLC)andBunkersConventionsforoilpollution.
ThenewEUsanctionsannouncedinJanuary2012extendtothecarriageofpetrochemicalproductsandcrudeoil,andwillfullyapplytoanyexistingcontractsfromMayandJulyrespectively.TheseactuallybuilduponprevioussanctionsrelatingtoanyitemsthatmightassistIran’snuclearprogrammeintermsoftheterritoryandtheentitiestowhichtheyapply.Inshort,thesanctionsapplytoshipownersincorporatedordomiciledinEUnations,toshipsregisteredinorflyingtheflagofanEUMemberState,andtoallvessels,regardlessofplaceofregistration,whichtradetoEUports.
However,theEUsanctionsalsoapplytoinsurerswithintheEU,prohibitingthemfromissuingormaintaininginsurancewithregardtoanysanctionableactivityortrade.TheythereforeapplytoP&IClubs(andtheirreinsurers)aswellastohullinsurers(andtheirreinsurers),whichareincorporated,domiciledorregulatedwithinanEUMemberState.MostP&IClubs,andalargeproportionofhullinsurers,arelocatedinEurope,whilemostreinsuranceisprovidedinLondonorintheUnitedStates,whereitwillalsobeaffectedbytheUSsanctions.
WithspecificregardtothirdpartyliabilityinsuranceprovidedbytheInternationalGroupofP&IClubs(IG),theEUsanctionswillalsoaffectvesselsthatwouldotherwisefalloutsidethejurisdictionofEUMemberStates,evenifsuchvesselshavetheirP&Iinsurancewithanon-EUregisteredP&IClub.ThisisbecausesuchaClub(ifanIGmember)willbeunabletoobtainaccesstoreinsurancefromtheEUbasedClubsviatheIGPoolingAgreement.Anon-EUClubwillalsobeunabletoaccessmarket
reinsurancecoverfromotherEUbasedreinsurers.
AllInternationalGroupClubshaveincludedintheirrules,inoneformoranother,eitherexpresssanctionstocoverterminationorexclusionprovisionsforimprudentorimpropertrading.Theeffectoftheserulesistowithdraworexcludecoverinrelationtosanctionsoffendingvoyages.Inotherwords,ifashippingcompanyundertakessuchavoyageitsliabilitieswillnotbeinsuredbytheInternationalGroup.
ThisrestrictionwillthereforealsohaveanimpactonanycompulsoryinsurancecertificationrequiredbyIMOConventions(whilepaymentforliabilitiesthataresubjecttocompulsoryinsurancemayalsobecaughtbytheprohibitionsinthesanctions).Asaconsequence,shipownersinbreachofsanctionsmayalsobeviolatingflagstatelaw,eveniftheflagstateisnotconnectedwiththeEU.Aswellasmonetaryfines,penaltiesmayincludedetentionofthevesselandsuspensionofthevessel’scertificateofregistry.
InApril2012,itwasstilluncertainwhattheexactscopeofthesanctionswouldbe.However,theconcernremainsthatthoseresponsiblefordevelopingsanctionspolicymayhavelittleunderstandingofthewiderconsequencesforshippingandtrade,manyofwhichmaybeunintended.
37
![Page 40: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/40.jpg)
LLMCIncreases
InApril2012,theIMOLegalCommitteeagreedsignificantincreasestothelimitsofliabilityundertheLimitationofLiabilityforMaritimeClaimsConvention1996(LLMC).UndertheIMO‘tacitamendment’procedure,the51%increaseswillcomeintoeffectin2015.Inadditiontogeneralmaritimeclaims,theLLMClimitsalsoapplytoclaimsunderIMOConventionsgoverningliabilitiesforbunkerspills(otherthanclaimscoveredbytheCivilLiabilityConvention)andwreckremovaloncetheNairobiConventionentersintoforce.
TheincreasesweremadeattheinitialrequestofAustraliainresponsetothe‘PacificAdventurer’bunkeroilspillinQueenslandin2009wheretheclean-upcostswerethoughttohaveexceededtheapplicablelimitationamount.Australiahadsupportfrom20co-sponsoringnations,whichmeantthatthefactthelimitswouldbeincreasedwasprobablyneverindoubt.Intheeventtherealdebatewasaboutthequantumoftheincreases.Australiahadmadeitclearfromtheoutsetthatitwasseekingthemaximumamountpossibleviathetacitamendmentprocedure,namely6%peryearcalculatedonacompoundbasisfrom1996.However,Japanwasfirmlyoftheviewthattheincreasesshouldnotbehigherthantherateofinflationduringtherelevantperiod(some2.7%peryearcompounded).
ThroughoutthedebateatIMOoverthepasttwoyears,ICSobservedthattheindustrywasopentoadiscussionofincreases,butthatthesehadtobebasedonthecriteriaspecifiedinthe‘tacitamendment’procedure,namely
RepresentingtheGlobalShippingIndustry
38
![Page 41: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/41.jpg)
theclaimshistory,inflation,andtheeffectonthecostofinsurance.
SomenationscontinuedtoexpressdoubtastowhetheranyincreaseswerejustifiedinviewofthestatisticscompiledbytheInternationalGroupofP&IClubs.Theseshowedthatonlyasmallnumberofclaimshadnotbeencompensatedfullyunderthepresentlimits.TherewasalsoarobustdiscussionabouthowinflationshouldbecalculatedwithmanystatessupportingtheJapaneseposition.Itwasacknowledgedthatitwasnotpossibletoquantifytheeffectofincreasedlimitsoninsurancepremiumsbecausethatwoulddependonfutureclaims.Butifamajorincidentnowoccursthatissubjecttothehigherlimits,thenthisislikelytobereflectedinincreasedpremiumssoonafterwards.ICSbelievesthatthefinalincreasesagreedbyIMOareareasonablecalculation.Itremainstobeseenwhateconomicimpactthenewlimitswillhaveontheindustryaftertheycomeintoeffectin2015.However,itistobehopedthattheincreaseswillensurethattheprincipleoflimitationofliabilitywillbemaintained,whichisvitalifshipownersaretocontinuetohaveaccesstoaffordableinsurance.ItisalsohopedthatthenewlimitswillnotdeterlessdevelopednationsfromsubscribingtotheLLMC.
PassengerShipLiability
Questionsrelatingtopassengerliabilityinsurancearelikelytoreceiveadditionalattentionasaresultofthe‘CostaConcordia’cruiseshiptragedy.However,theimmediatefocusofICSistheimplicationsoftheentryintoforceofthe2002ProtocoltotheIMOAthensConvention(whichisexpected
soonfollowingratificationbyEUMemberStates)notleasttheneedforcertificationofinsurancecoverforterrorismandwarrisks.
Inco-operationwithECSA,andtheInternationalGroupofP&IClubs(IG),ICSisalsoseekingtoaddressthesimilarproblemsthatmayariseasaresultoftheenforcementoftheEUPassengerLiabilityRegulation(PLR)withwhichshipoperatorsmustcomplyfrom31December2012,andwhichbroadlymirrorstheIMOAthensProtocolrequirements.
Theissuesarecomplex,butthethornyissueofterrorismcoverhashamperedimplementationoftheIMOProtocolsinceIMOMembersStatesfirstrejectedindustryargumentsthatterrorismisanattackonsocietyatlargeandthatthecostsshouldthereforebebornebygovernments.InsteadIMOdecidedthattheprovisionofsuchcovershouldbelefttothemarket.
ThepotentialliabilitiestowhichtheClubsmightbeexposedundertheAthensProtocolarehuge,perhapsinexcessofUS$5billionpershipinaworstcasescenario.TheP&IClubscommunicatedtheirdifficultiesinprovidingcoverforterrorism(whichcouldhaveimplicationsfortheinsurancetheyprovidetonon-passengershipping)andacompromisewasarrivedatbytheIMOLegalCommitteein2006,wherebycoverforterrorismcouldbelimitedtoUS$500million.However,thisIMOcompromisewasunderpinnedbyaschemeproposedbytheinsurancebrokerMarshLtd.WhileMarshhasadviseditsschemewillbeupandrunningintimefortheapplicationoftheEUPLRattheendof2012,questionsaboutthescheme’sviability
continue,anditisstillunclearwhattherateswillbeandwhetherlargershipswillbecovered.
AlthoughtheIGP&IClubshavenowdecidedtoissuecertificatesofinsuranceforthenon-warrisksarisingundertheEUPLRandtheIMOAthensProtocol,theyhaveyettodecideontheprovisionofIGClubcoverforthewar/terrorismrisks.
InOctober2011,ICSmetwithEUgovernmentstoobtaintheirviewsonthestructureoftheinsurancevehicleproposedbyMarshLtd,andfromthelimitedresponsesreceiveditwouldseemthatgovernmentswillacceptit,notwithstandingthepracticaldifficultiesthatmightariseforclaimantsintheaftermathofacasualty,suchastheneedtodealwithamultiplicityofinsurersfortheirindividualindemnities.Thegovernments’approachappearstobeguidedbyageneralunderstandingthatsuchcovermightnotbeavailableelsewhereandthatthisisthebestthatcanbeobtainedfromthecommercialmarket.Butitisuncertainwhethertheyarefullyaufaitwithallofthepotentialcomplexitiesinvolved
Giventhecomplicationofhavingtohaveseparateterrorismcover,theindustryistryingtopersuadegovernmentstodevelopacommonpositionwithregardstoportstateacceptanceofinsurancecertificates.ICSandECSAarealsoencouraginggovernmentstoensurethatwhenratifyingtheAthensProtocoltheymaketheimportantreservation,asagreedandrecommendedbyIMO,withrespecttoshipowners’liabilityforwarandterrorismrisks.However,somedetaileddiscussionswillbeneededbetweennowandtheendoftheyear.
39
![Page 42: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/42.jpg)
EnvironmentalSalvageAwards
Inco-operationwiththeInternationalGroupofP&IClubs,ICScontinuestoleadshipownerrepresentationonsalvageissues,particularlyinrelationtothesmoothoperationoftheLloyd’sOpenFormandSCOPIC(specialcompensation)regime.
ICSismaintainingitsfirmoppositiontoproposalsfromtheInternationalSalvageUnion(ISU)foranewseparateawardfor‘environmentalsalvage’whensalvorshavecarriedoutoperationsinrespectofashiporcargowhichhaspresentedathreatofdamagetotheenvironment.ICSisdeeplyscepticalabouttheproposal,believingthatsalvageservicesarealreadygenerouslyrewardedunderthepresentsystem.
AworkinggroupestablishedbytheLloyd’sSalvageGroup,inwhichICSparticipates,hasreachedastalematefollowingtheISU’sinabilitytodemonstratethatitsproposalwouldimprovesalvageresponse,ordelivercostsavingstothosepayingforsalvageservices.However,theISUhassucceededinpersuadingtheComitéMaritimeInternational(CMI),theinternationalassociationofmaritimelawyers,togiveconsiderationtoitsproposalsforarevisionoftheIMOConventiononSalvageandalsotoamendtheLloyd’sOpenForm(LOF).
Despitethelackofindustryconsensus,aCMIworkinggrouphasalreadystartedworkonpossibleamendmentstotheLOF.ICSregardsthisdevelopmentwithparticulardismaysinceitappearstoinvolvethediscussionofproposalstoamendwhatineffectisaprivatecontractwithouttheinvolvement
RepresentingtheGlobalShippingIndustry
40
![Page 43: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/43.jpg)
ofatleastoneoftheparties,whilstbypassingthelongstandingforumalreadyestablishedtocarryoutsuchworkwhichistheLloyd’sSalvageGroup.InMarch2012,ICSandtheInternationalGroupofP&IClubswroteformallytoCMI,settingoutshipowners’concernsinthestrongestpossibleterms.
TheISU’sproposalswithrespecttoenvironmentalawardswillbediscussedfurtherattheCMIConference,inBeijing,inOctober2012atwhichICSwillberepresented.GiventhatCMIdoesnotplantoinvitedetailedpresentationstobemadeontheseissuesbyalloftheinterestedparties,itisoftheutmostimportancethatthereportoftheCMIworkinggroupisasbalancedaspossibleandreflectsthedivisionwithintheindustry.TheCMIshouldalsobearinmindthatamendmentstoIMOConventionshavetobeproposedbygovernments,andthattheIMOLegalCommitteeisunlikelytoentertainproposalsthatfailtodemonstrateanycompellingneed.
ICSdoesnotbelievethattheproposalsconcerningenvironmentalsalvageenjoythesupportofmostnationalmaritimelawassociations,andinMarch2012ICSpublishedadetailedpositionpaperreiteratingtheargumentsastowhytheyshouldnotbesupported.
RotterdamRules
ICScontinuestopromotetheratificationoftheRotterdamRulesoncargoliabilitywhichwereformallyadoptedin2009bytheUnitedNationsCommissiononInternationalTradeLaw(UNCITRAL).TheRotterdamRulesareintendedtoreplaceoutdatedcargoliability
regimessuchastheHamburgandHague/VisbyRules,takingaccountofmodernmulti-modaltransportand‘doortodoor’deliverypractices.
ICSrecognisesthatthenewrulesmaynotbeperfect,andinsomerespectsareoverlycomplex.However,maintenanceofthestatusquoisnotarealisticoption.IftheRotterdamRulesdonottakeholdthentheUnitedStatesandtheEUwillalmostcertainlypursuetheirownregionalregimesandtheopportunityforglobaluniformitywillbelostforanothergeneration.FollowingathoroughanddetailedanalysisoftheRotterdamRules,ICSmembershavethereforeconcludedthatthenewregimemustbestronglypromotedbytheshippingindustryinordertoavoidtheriskofaproliferationofregionalcargoliabilityregulations.
Encouragingly,theUnitedStatesappearstobecommittedtotheearlyratificationoftheConvention.WiththefullsupportofUScarriersandshippers,theStateDepartmenthaspreparedafiletobeputbeforeCongresswhichisexpectedtotakethisforwardafterthe2012PresidentialElection.Thiswillalmostcertainlygivecriticalmomentumtotheprocessofratificationworldwide,withChinaandotherAsiannationslikelytowishtoaligntheirregimeswiththeUS.Meanwhile,althoughsomepartsoftheEuropeanCommission,whomayhavebeeninfluencedbytheEuropeanShippers’Council(ESC),havebeenambivalentabouttheUNCITRALConvention,forthemomentatleasttheEUhasputasideplansforaregionalcargoliabilityregime,andmanyEUStatesareproceedingtowardsratification.Moreover,thedoubtsabouttheRotterdamRulesdisplayedbytheESC
41
![Page 44: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/44.jpg)
arenotsharedbytheGlobalShippers’ForumwhichembracesUSandAsianshippers.Whilethosewhoweredeeplyinvolvedinthenegotiations,suchasICS,areclearabouttheneedtoencouragegovernmentstoratifyandimplementtheRotterdamRules,therestillappeartobereservationsinsomequarters,includinginAsia,aboutthebenefitsofthenewregime.AnongoingpriorityforICS,inco-operationwithlocalnationalassociationsandbodiessuchastheAsianShipowners’Forum,istoexplaintotheseinterestswhytheRotterdamRulesshouldbesupported.
CompetitionIssues
Compliancewithcompetitionlawismostimportantgiventhateven‘technical’violationsbyshippingcompaniescanresultinpenaltiesamountingtotensofmillionsofdollars.InMay2011,mostofthemajorinternationalcontainerlineswerepresentedwithasharpreminderofthiswhentheEuropeanCommissionlaunchedadawnraidonnumerouscompanyoffices.Apparentlythiswastoestablishthatitsmajorshake-upofcompetitionrulesin2008isbeingfullycompliedwith.ItisunderstoodthattheEuropeanCommissionwasnotrespondingtoanyparticularcomplaint;noristherereasontobelievethattherehasbeenanynon-compliance.(However,inMarch2012,theEuropeanCommissionalsodemonstrateditspowerbyfining14internationallogisticscompanies,includingUPSandKuehne&Nagel,€169millionforcollusionwithrespecttosecuritysurcharges.)
Theabovenotwithstanding,in
thosepartsoftheworldwheretheyarestillpermitted,ICSpolicyistodefendthecontinuedexistenceoflinerconferencesandothersimilarexemptionstocompetitionlawsuchasdiscussionagreements.TheEUCompetitionDirectorate,however,continuestoargueforcefullythatitsforeigntradingpartnersshouldfollowitsunilateralexampleofmakingshippingcompanies’participationinsuchmechanismsillegal.
ICShasthereforewelcomedthepublication,inFebruary2012,bytheUnitedStatesFederalMaritimeCommission(FMC)ofitsdetailedstudyoftheimpactoftheEUprohibitiononUStrades.ManyoftheFMC’sconclusionsappeartosupporttheICSpositioninfavourofthemaintenanceofthestatusquowithrespecttocurrentantitrustimmunitythatappliesinnon-EUtrades.Basedonitsexaminationoftheperiod2006-2010,theFMChasconcludedthattherepealoftheEUBlockExemptionhasapparentlynotresultedwithanyrelativedeclineinEUfreightratescomparedwithFarEast/UStrades.Inotherwords,shippersinEUtradeshavenotbeenadvantagedasaresultoftheEUdecisioncomparedtoshippersinFarEast/UStradeswheretheEUprohibitiondoesnotapply.TherealsoappearstohavebeenanincreaseinratevolatilityinEUtrades,comparedtoFarEast/UStrades,andtheFMCsuggeststhattheactivitiesofdiscussionagreementsthatarestillpermittedinnon-EUtradesmayhavehada‘dampeningeffect’onratevolatility.
ABillintroducedtotheUSCongressin2010proposedremovalofmuch
oftheantitrustimmunitywhichisstillenjoyedbytheinternationallinerindustryinUStrades.Fortunately,thisBillisnowdeadandlittlefurtheractionisanticipateduntilafterthePresidentialelectionsinNovember2012.TheFMChasreachednofirmconclusionsastowhetheranychangesarewarrantedwithrespecttocurrentUScompetitionregulationssuchastheOceanShippingReformAct.However,theFMCstudydoesseemtoprovideevidenceinsupportofmaintainingthestatusquoshouldtherebefurthercallsfortheUStofollowtheexampleofEurope.
Meanwhile,inAsia,followingonfromthedecisionbySingaporethatitsblockexemptionfromcompetitionrulesforlinershippingagreementswillbeextendeduntil2016,ICShaswelcomedthesimilardecisionbyJapan,inJune2011,tomaintainitsAntitrustImmunitySystemuntilatleast2015.JapanhasalsoconcludedthattheEUrepealofantitrustimmunityhasledtoincreasedvolatilityoffreightratesinEuropeanlinertrades,aswellasariseinsurchargesleviedbyindividualcarriers.Inaddition,theJapanesegovernmentwasconcernedthatthedrasticrationalisationoflinerservicesbyindividualcarrierswhichhasensuedsincethedownturn,andwhichhasresultedwithareductionofavailableservices,waspartiallyaresultofthelines’reducedabilitytoco-operate.ICShaswelcomedtheagreementbytheAsiaPacificEconomicCo-operationforum(APEC),inJune2011,onguidelinesonmaritimecompetitionrules,specificallyforco-operationagreementswhichdonotinvolveratesetting,suchasconsortia.Althoughafarlooserformofco-operationthanconferences,
42
![Page 45: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/45.jpg)
consortiahaveprovidedstabilitytomarkets,helpingguaranteethemaintenanceofscheduledservicestomoreremotedestinationsandpermittingefficienciessuchasslotsharingoncontainerships.Inparticular,consistentwithargumentspresentedbyICS(andtheWorldShippingCouncil)atanearlierAPECconsultationmeetinginTokyo,ICShaswelcomedtherecommendationthatfilingrequirementsshouldbelefttothediscretionofindividualgovernments,sincethesearecommonlyrequestedbythosegovernmentswhichcontinuetoallowamoreflexibleapproachwithregardtoco-operationbetweenshippingcompanies.
AnumberofotherAsianjurisdictionsarealsoreviewingtheapplicationofantitrustlawtoshippingaspartoftheirdevelopmentofgeneralcompetitionlaw.ThelatestcountrytodothisisNewZealand.InSeptember2011,ICSsubmittedcommentstotheNewZealandProductivityCommissionandurgedtheNewZealandgovernmenttoconsiderthemaintenanceofpracticespermittedintherestoftheAsia-Pacific.
InJanuary2012,NewZealandreleasedadraftreportofitsenquiryintointernationalfreighttransportserviceswhichrecommendsthatitsexemptionforratemakingorcapacitylimitingagreementsberepealed,butthattheexemptionfornon-ratemakingactivitiesshouldberetained,conditionalonfilingtheagreementswiththeMinistryofTransport.
RepresentingtheGlobalShipping
Industry
![Page 46: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/46.jpg)
ECInvestigationofIGofP&IClubs
ICSfirmlybelievesthatthecurrentsystemofmutualthirdpartyliabilityinsuranceprovidedbytheInternationalGroupofP&IClubs(IG)continuestoservethebestinterestsofshipoperatorsandtheircustomersextremelywell,alongsideservingtheinterestsofclaimantsandthegeneralpublic.Inparticular,themutualinsurancearrangementsprovidedbytheClubsenabletheprovisionoftheveryhighlevelsofinsurancerequiredunderinternationalliabilityconventions,underwhichcompensationtoclaimantsisgenerallypaidregardlessoffaultandwithoutlegalwrangles.
ICSisthereforecloselyfollowingtheEuropeanCommission’sinvestigationsoftheactivitiesofthe
IG,theCommissionhavingopenedformalproceedingsin2010.TheCommissionhadstatedthatitwassimplyconductinganinvestigation,andthatthisdidnotimplythattherewasanyproofofinfringement.TheCommissionhadalsoadvisedthatithadopenedtheinvestigationonitsowninitiativeandthatithadnotreceivedanyformalcomplaints.
ItwasoriginallyunderstoodthattheCommissionwishedtoexaminewhethercertainprovisionsoftheIGAgreementandPoolingAgreement,notablytheGroup’sclaimssharingandreinsurancearrangements,mightsomehowlessencompetitionbetweentheClubsorrestricttheaccessofcommercialinsurersorothermutualP&Iinsurerstotherelevantmarkets.InbilateraldiscussionswiththeCommission,ICSandECSAhave
thereforeemphasisedthatthemutualinsurancearrangementsprovidedbytheP&IClubsareefficientandcosteffective.Fortheirpart,theCommissionofficialswhoweretheninvolvedhadstressedthattheywerenotintentondestroyingthesystembutwereinterestedinthequotationprocedure,releasecalls,andtheavailabilityofcommercialP&IinsuranceoutsidetheInternationalGroupsystem.
In2011theCommissionsentoutquestionnairestoindividualshippingcompaniesseekingfurtherinformationontheapplicationoftheIGAgreement,andalsorequesteddetaileddocumentationandinformationfromtheIGClubs.However,developmentshavebeenmuchslowerthanexpected,apparentlyduetotheappointmentofanewteamofcasehandlers.
RepresentingtheGlobalShippingIndustry
44
![Page 47: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/47.jpg)
FlagStatePerformance
Inaglobalisedindustrysuchasshipping,thereisnothinginherentlywrongwitharegulatorysysteminwhichtheflagwhichashipchoosestoflyisdifferenttothecountryofbeneficialownership.Inparticular,ICSbelievesthatgeneraliseddistinctionsbetweentheperformanceofopenregistersandsocalledtraditionalmaritimeflagsareneitherhelpfulnorrelevant.Pejorativetermssuchas‘flagsofconvenience’havemoretodowithindustrialrelationsissuesofthe1980sthanthesituationwhichpertainsto2012.FlagstatessuchasBahamas,Liberia,HongKongandSingaporeareamongsttheverybestperformersintermsoftheirimplementationofIMOandILOrequirementsandportstatecontrolinspectionrecords,whiletheownershipprofileofmanyOECDshipregistersnowincludeslargenumbersofforeignownedshippingcompanies.
Nevertheless,ICSbelievesthatabalancehastobestruckbetweenthecommercialadvantagesofshipownersselectingaparticularflagandtheneedtodiscouragetheuseofanyshipregisterthatdoesnotmeetitsinternationalobligations.Whileitisshippingcompaniesthathaveprimaryresponsibilityforthesafeoperationoftheirshipsitistheflagstatethatmustenforcetherules.
ICShasthereforebeenastrongsupporteroftheIMOMemberStateAuditSchemeandhaswelcomedthedecisionbyIMOfortheauditstobecomemandatoryin2014,oncethefirstroundofvoluntaryauditsiscomplete.InMarch2012,IMOfinalisedadraftofitsIMOInstrumentImplementationCode,whichwillunderpinthemandatoryschemesubjecttoadoptionbythe2013IMOAssembly.However,intheinterestsoftransparency,ICSbelievesthattheresultsoftheIMOauditsshouldbepublished,andthat,asaminimum,informationshouldbemadeavailablebyIMOastowhethermaritimeadministrationshaveactuallyputthemselvesforwardforinspection.Inthemeantime,ICShaswelcomedthedecisionofsomeofthemajorregionalportstatecontrolauthoritiestorequestinformationastowhetherauditshavebeenconductedaspartoftheircriteriafortargetinginspections.AsacomplementtotheIMOScheme,andasaservicetotheindustry,ICScontinuestoproduceitsannualShippingIndustryFlagStatePerformanceTablewhichcollatesvariousdataavailableinthepublicdomainandwhichcanbedownloadedfromtheICSwebsite.However,underthesupervisionofICS’smembernationalshipowners’associations,thepresentationofthe
Tablefor2011hasbeenmodifiedslightlyinordertoaddressfeedbackfromgovernments,includingcommentsattheIMOFlagStateImplementationCommitteewhichquestionedsomeofthecriteriausedbyICSandwhetherthedatamightbepresentedinamorepositivemanner.
However,thepurposeofthenewTableisthesame:toencourageshipownerstoexaminewhetheraflagstatehassubstancebeforeusingitandtoencouragethemtopressuretheirflagadministrationtoeffectanyimprovementthatmightbenecessary.ICSmakesnoapologyforcontinuingtosubjectflagstatestoscrutiny,inthesamewaythatshipsandcompanyproceduresarerightlysubjectedtoinspectionbygovernments.Theoverridinginterestinpromotinghighperformingflagsisthattheyarelesslikelytotoleratesub-standardoperatorswhowouldotherwiseenjoyanunfaircommercialadvantageoverthevastmajorityoffullycompliantshippingcompanies.
ShippingPolicyandFreeTrade
Forthepastfouryearstheshippingindustryhasbeenconfrontedwithunprecedentedeconomicturmoil.Muchoftheindustryisstillstrugglingwiththeseriousconsequencesofatrulymassivecontractionineconomicactivity,withglobaltradeestimatedtohavedeclinedbynearly10%in2009.Whiletradepickedupalittle,especiallyinAsia,thelatestWorldTradeOrganizationprojectionsfor2012arenotverypositiveandoverallglobaltradeisprobablynotmuchimprovedonthelevelsthatexistedbefore2008.Thepracticeofsoundshippingpolicybygovernmentsisthereforeasimportantasever.
45
![Page 48: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/48.jpg)
ShippingpolicyinvolveslongtermengagementbyICSanditsmembernationalassociationsinthelargelyunseendiplomaticactivitynecessarytohelpensurethemaintenanceoftheopenmarketswhichtheshippingindustryneedstooperatecompetitivelyandefficiently.Shippingalsorequiresaregulatory‘levelplayingfield’and,inviewofthegreatmarketvolatilitybeingexperiencedduringthecurrenteconomicdownturn,thecontinuationofthecertaintyprovidedbythetonnagetaxregimesthatnowapplytoshippingcompaniesinmostcountries.InJune2011,ICSmadetheseimportantpoints(aswellashighlightingtheissueofSomalipiracy)asoneoftheleadingindustryparticipantsatamajorConferenceoftheworld’stransportministersinLeipzig,organisedbytheOECDInternationalTransportForum,whichhascontinuedtofocusontheimplicationsfortransportasitemergesfromtheeconomicdownturn.ICSwillagainberepresentingtheindustryatthenextOECDtransportministers’conferenceinMay2012.
Moreroutinely,ICScontinuestoplacegreatimportanceonrelationswiththeConsultativeShippingGroup(CSG)ofgovernments,whichistheguardianofmaritimefreetradeprinciples.InJune2011,inco-operationwithECSAandtheRoyalBelgianShipowners’Association,ICSheldaseminarontradepolicyforCSGgovernmentsattheirmeetinginBrussels.InconjunctionwithASFandtheSingaporeShippingAssociation,asimilareventwasorganisedinApril2012attheCSGmeetingheldinSingaporewhich,interalia,discussedthepossibletradeimplicationsof
marketbasedmeasuresforCO2emissions.
ICShascontinuedtogiveinput,vianationalassociations,onissuesrangingfromproblemsofmarketaccesstogovernmentinterferenceinlocalmarkets.TheCSGisalsoausefulconduitforthediscussionofsensitivediplomaticissues,suchasthetreatmentofpiracy.
InadditiontothebroaderroleoftheCSGasaforumfordiscussionofshippingpolicyandtradeissues,itstillmaintainsitsoriginalfunctionasprovidingameansfortheworld’smajorshippingnationstocommunicatewiththeUnitedStatesgovernment,whichhistoricallyhasoftenbeenslightlydetachedfromthemainstreamoftheinternationalshippingcommunity.ICSwillparticipateatthenextCSGdialoguemeetingwiththeUnitedStates,inWashingtonDC,inJune2012.AmajorconcernofICSnationalshipowners’associationshasbeentodiscouragegovernmentsfromrespondingtothecurrenteconomiccrisiswithprotectionistmeasures,whichwillonlydamageworldtradefurther.Moreparticularhasbeentheneedforgovernmentstoavoidmeasuresthatrestrictfairandopenaccesstoshippingmarkets.Acaseinpoint,whichreceivedcloseattentionin2011,wastheapparentattemptsbytheChineseauthoritiestorestrictaccesstoChineseterminalsfortheultralargebulkcarriersoperatedbytheBrazilianironoreproducerVale,althoughthisissuenowseemstohavebeensettledsatisfactorily.Likewise,whilstICShasnoopinionabouttheunderlyingissuessurroundingthefutureoftheFalklandIslands(Malvinas),any
restrictionsbyArgentinaonshipsthathavecalledattheislandswillbeofgreatconcernbecauseofthenegativeprecedentthatcouldbesetwithrespecttothemaintenanceofmaritimefreetradeprincipleselsewhere.
Althoughoflittleimmediatecomforttothoseindividualcompaniesthatmaystillbestrugglingtosurvive,oneconsolationisthatgovernmentssofarappeartohavemadeadeterminedefforttoavoidtheexcessiveuseofprotectionistmeasures,(althoughinearly2012somebackwardlookingmoveswereproposedwithintheEUwithrespecttogovernmentprocurement).Buttherecoveryoftheworldeconomyisstillfarfromcertain,anditwillremainimportantforICS,andlike-mindedgovernments,toremainvigilant.Inparticular,ICSremainscommittedtotheinclusionofshippinginanynewagreementonservicesthatmaybeagreedbytheWorldTradeOrganization(WTO),inordertocodifytheliberaltradingpracticeswhichalreadyapplytomostshippingmarkets.However,progresstowardsanewWTOdealontraderemainsslow,largelyduetosignificantdifferencesbetweengovernmentsonissuessuchasagriculture.
ShipbuildingPolicy
Shipping,ofcourse,istheservantofworldtradeandjustasitbenefitedfromtheboomyearsofthemid2000sitsfortunesarenowalsoinextricablylinkedtotherecentfallinthedemandforitsservices.Butmanyoftheproblemsconfrontingshippinghaveundoubtedlybeenexacerbatedbyshipownersplacingordersforfartoomanyships,withfartoofewcargoestocarry.With
46
![Page 49: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/49.jpg)
RepresentingtheGlobalShipping
Industry
47
![Page 50: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/50.jpg)
48
![Page 51: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/51.jpg)
vastamountsofnewtonnagebeingdeliveredduring2012,inmanytradesthereisnowamajorglutofships.
Currentmarketswouldappeartobedemonstratingjusthowseriouslydamagingtheoversupplyofshipshasbeentoshipowners’revenues,withmanynowstrugglingtomeettheiroperatingcosts.However,theproblemsofindividualownersaside,thebiggestdangerperhapsistheovercapacitythatexistsintheshipyards,withanalmostobsessivecommitmenttomarketsharebeingdisplayedbythethreemajorshipbuildingnations:China,KoreaandJapan,where90%ofworldtonnageisbuilt.Evenifshipyardsgobankrupt,itislikelythattheirgovernmentswillstepinsothattheycancontinuetoproduceshipswhichfewpeoplewant,otherthanspeculatorswhomaybefoolishlytemptedbyknockdownprices.However,amarketmightbefoundforotherwiseunwantedChineseshipsbytheChinesefleetitself,withChinahavingawidelyrecognisedgoalofseekingtocarryamuchlargerproportionofitscargoes–perhaps50%-onboarditsownvessels.
ItisthereforeasourceofdisappointmentthattheOECDhasconfirmeditsdecisiontoterminatenegotiationsonanewagreementtoeliminatesubsidiesandmarketdistortingmechanismsintheshipbuildingindustry.ThiswasprimarilyduetodifferencesbetweentheEuropeanCommissionandAsiangovernmentsaboutthetreatmentofpricingofnewshipsinanynewagreement,thelatterwishinginsteadtoconcentrateontheeliminationofsubsidies-apositionsupportedbyICS.However,theOECDWorkingPartyonShipbuildingwillcontinue
tomeet,inordertoexplorefurtherwhatconstitutesmarketdistortionandthemeansofachievinggreatertransparencyongovernmentsupportmeasures.ICSwillattendameetingthatOECDisorganisinginParisinJune2012,withthegoalofencouragingtheresumptionofthetalksassoonaspossible,eveniflittleimmediatemovementisanticipated.Inviewoftheserioussupply/demandimbalancethatcurrentlyprevailsitisclearthatspeculativeorderingofshipsthathavenoeconomicpurposeshouldbediscouraged.Whatevermightseemrationalfromanindividualcompany’sperspectivemightnotbegoodwhenseeninthecontextoftheindustryasawholeandtheindividualcompaniesitcomprises.
However,onethingonwhichICSisclearisthatitwillresistanysuggestionthatallshipsaboveacertainageshouldautomaticallybescrapped.ICSwillcontinuetoresisttheconceptofamaximumageforshipswhich,aswellasdamagingthecommercialinterestsoflargenumbersofcompanies,wouldremoveincentivestomaintainoldershipsandwouldhavenegativeimplicationsforsafetyandenvironmentalprotection.
CanalIssues
ThePanamaandSuezCanalsreducethelengthofmanyseavoyagesbythousandsofmiles,buttheprivilegeofusingthemisexpensive.Individualtransitsbylargevesselscancosthundredsofthousandsofdollars.WhilebothCanalsarededicatedtoprovidingexcellentservicetheyarealsoverymuchcommittedtoprofitmaximisation.
ThecurrentAdministratorofthe
PanamaCanal,MrAlbertoAlemánZubieta,whohasbeenpivotalinoverseeingthecurrentCanalexpansionandstrengtheningliaisonwithindustryhasannouncedthathewillstepdownfromhispostlaterthisyear.ICSlooksforwardtoworkingwithhissuccessor,MrJorgeQuijano,whowilltakeoverinSeptember2012.
InJanuary2012,ICShostedameetingofinternationalindustryrepresentativeswithadelegationfromthePanamaCanalAuthority(ACP)todiscussthefutureofoperationsafter2014,whenthetrulyimpressiveCanalexpansionprojectisscheduledforcompletion.TherewasapositiveexchangeabouttheACP’spreliminarythoughtsonhowCanaltollsmightchange.Ingeneral,theACPindicatedthatitwouldliketointroducemoresegmentationinitstollsinordertobetterrespondtomarketfluctuationsthataffectthecompetitivenessoftheCanalasaroute.Theindustryhadunderstoodthattheseideaswereatanearlystageandwouldbesubjecttomuchfurtherdiscussion.ICSwasthereforesurprisedwhen,attheendofApril20I2,theACPannouncedmajortollincreases,formanylarger(non-container)ships,of15%overthenexttwoyears,commencinginJuly,withevenlargerincreasesformanysmallervessels.Inaddition,theACPhasannouncedgeneralincreasesintariffsforsecurityandoilspillresponseservices,bothofwhicharemandatoryforshipspassingthroughtheCanal.Theindustryisexpectedtoopposethesedevelopmentsverystrongly.Meanwhile,ICShasopposedthe3%tollincreasesannouncedbytheSuezCanalAuthority(SCA)inDecember2011,atatimewhentheindustryisstillstrugglingtomanagetheeffects
RepresentingtheGlobalShipping
Industry
49
![Page 52: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/52.jpg)
oftheglobalfinancialcrisis.SuezCanaltollshaveremainedfrozenforthepastthreeyearsinrecognitionofdifficultshippingmarkets.ICSthereforeco-ordinatedanindustryresponsetotheSCA,explainingthattheeconomicsituationhasnotimprovedandrequestingthattheincreasesbeadjustedordeferred.Disappointingly,however,theincreaseswentaheadunchangedinMarch2012.
FollowingthedramaticpoliticaleventsinEgyptin2011,andthecollapseofothermajorsourcesofforeignincomesuchastourism,theSCAisnodoubtunderpressuretomaintainitsrevenue.TotheSCA’scredit,theCanalhascontinuedtofunctionsmoothly.However,ICShassincerepeateditsrequestforfullandproperconsultationbetweentheindustryandtheSCA,particularlywhenevertolladjustmentsarebeingcontemplated.
IndustryRepresentationandCo-operation
Astheprincipalinternationalassociationfortheshippingindustry,theprimaryfocusofICSrepresentationistheInternationalMaritimeOrganization(IMO).ICSparticipatesactivelyinvirtuallyeveryIMOCommitteeandSub-Committeeaswellasnumerousspecialistworkingandcorrespondencegroups.ICSisthereforeacknowledgedbygovernmentsasrepresentingtheconsideredviewsofallinternationalshipoperators.
Whilstefficientglobalshippingdependsonasystemofuniformglobalrules,shipoperatorsstillliveinaworldofnationstates.Theimportanceofnationalshipowner’s
associationsthereforeremainsasessentialasever.ThestrengthofICS’sadvocacyatIMO(andthevariousotherforathatimpactonshipping)isverymuchdependentontheICSmemberassociationswhichpresentagreedICSpositionstotheirmaritimeadministrationsinadvanceofintergovernmentalmeetings.ICSmemberassociationscollectivelydeveloptheindustry’sglobalpositionsthroughacomprehensivestructureofspecialistcommittees(seepage56).
UsingitsseparateISFidentityasanemployers’organisation,ICSisalsoanofficialsocialpartnerattheGeneva-basedInternationalLabourOrganization(ILO)andactsasSecretarytotheEmployers’GrouponallILOmaritimeissues.
InadditiontointeractingwithindividualgovernmentsduringmeetingsatIMOinLondonandILOinGeneva,ICScontinuesregularattendanceatmoregeneralpolicymeetingsheldbytheUnitedNationsinNewYork,theWorldTradeOrganization(WTO),theOrganizationforEconomicCo-operationandDevelopment(OECD),theConsultativeShippingGroup(CSG)ofmaritimeadministrations,theUnitedNationsConferenceonTradeandDevelopment(UNCTAD),theWorldCustomsOrganization(WCO),and,insofarastheyarerelevanttoseafarers,bodiessuchastheWorldHealthOrganization(WHO).GiventheimportanceofdiscussionsaboutCO2emissionsreduction,ICShasalsotakenupconsultativestatuswiththeUnitedNationsFrameworkConventiononClimateChange(UNFCCC)andrepresentedtheindustryatthelastUNClimateChangeConference(COP17)inDurbaninDecember2011.
ICSenjoysgoodrelationswithmanyotherintergovernmentalbodiesthatimpactonshippingincludingtheInternationalAssociationofMarineAidstoNavigationandLightHouseAuthorities(IALA),theInternationalHydrographicOrganization(IHO)andtheWorldMeteorologicalOrganization(WMO).ICSalsohasconsultativestatuswiththeInternationalMobileSatelliteOrganization(IMSO),whichisthebodythatoverseespublicsafetyandsecuritycommunicationservicesincludingtheGlobalMaritimeDistressandSafetySystem(GMDSS).Inaddition,ICSattendsmeetingsofboththeParisandTokyoMOUsonPortStateControl.
Asanemployers’organisation,andanofficial‘socialpartner’attheILO,theoppositenumberofISFistheInternationalTransportWorkers’Federation(ITF).Asreportedelsewhere,inApril2012nationalshipownerassociationsandITFunionaffiliatesheldameetingtoexchangeviewsonmattersofcommoninterest,thefirstsuchmeetingoutsidetheconfinesoftheILOforadecade.Itisintendedthatthispositivedialoguewillcontinue.Inaddition,ISFcontinuestobeamemberoftheInternationalCommitteeonSeafarers’Welfare(ICSW)whichembracessecularandreligiousseafarers’welfareorganisations.
Inviewoftheimportanceofensuringglobalregulationforaglobalindustry,ICScontinuestoworkcloselywiththeEuropeanCommunityShipowners’Associations(ECSA)incommunicatingonissueswithEuropethatarerelevantfromaninternationalperspective,andparticipatesinconsultationsorganisedbytheEUinstitutions.IntheUnitedStates,ICS
50
![Page 53: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/53.jpg)
RepresentingtheGlobalShipping
Industry
51
IMOinsession
![Page 54: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/54.jpg)
changesnecessitatedbytheSTCW2010amendments.
AnticipatingtheentryintoforceoftheILOMaritimeLabourConvention,aneweditionoftheISFGuidelinestotheILOMLCisexpectedtobepublishedinthefirsthalfof2012,inordertotakeaccountofthevariousclarificationsagreedbyILOsincetheMLCwasadoptedin2006.Incorporatingnewadviceoncomplianceandtheadoptionofbestemploymentpractices,itishopedthatthispublicationwillcometoberegardedasasisterpublicationtothedefinitiveICS/ISFGuidelinesontheApplicationoftheInternationalSafetyManagement(ISM)Code.
WorkisnowwelladvancedonaneweditionoftheICSTankerSafetyGuide(Chemicals).Thisisamajorundertakingbutpublicationisanticipatedin2013.Lookingforwards,aworkgrouphasalsobeenestablishedtobeginareviewofthecurrenteditionoftheICSTankerSafetyGuide(Gas).WorkisalsounderwayonaneweditionoftheICSBridgeProceduresGuidetotakeaccountofdevelopmentsine-navigation.
Meanwhile,inco-operationwiththeOilCompaniesInternationalMarineForum(OCIMF)andtheSocietyofInternationalGasTankerandTerminalOperators(SIGTTO)workhasprogressedonanewconsolidatededitionoftheShiptoShipTransferGuidethatwillcoverpetroleum,chemicalandgasoperations.Publicationisexpectedduring2012.
workswiththevariousUSagenciesthatimpactonshippinginliaisonwiththeChamberofShippingofAmerica,whichbyagreementofficiallyrepresentsICSinUSdiscussions.Additionally,ICSenjoysgoodrelationswiththeAsianShipowners’Forum,whosemembersarealsonationalshipowners’associations.ICSisalsonowdevelopingarelationshipwiththeAsiaPacificEconomicCo-operationforum(APEC)whichisbecomingincreasinglyengagedwithmaritimetransportmatters.
ICSworkscloselywithadiverserangeofotherindustryorganisationsthatareengagedgenerallyontransportissues,includingtheInternationalChamberofCommerce(ICC),theInternationalOrganizationforStandardization(ISO),theBusinessandIndustryAdvisoryCommitteetotheOECD(BIAC),theInternationalOrganizationofEmployers(IOE)andtheWorldOceanCouncil(WOC).
Lastbutnotleast,ICSenjoysgoodrelationswithvariousspecialistindustrybodiessuchastheInternationalAssociationofClassificationSocieties(IACS),theInternationalGroupofP&IClubs(IG),theInternationalUnionofMarineInsurance(IUMI),theInternationalAssociationofPortandHarbors(IAPH),theInternationalMaritimePilots’Association(IMPA),theNauticalInstitute(NI),andtheGlobalShippers’Forum(GSF).This,ofcourse,isinadditiontocloseco-operationwithotherspecialistinternationalshippingassociationsincludingBIMCO,theCruiseLinesInternationalAssociation(CLIA),Intercargo,Interferry,Intermanager,Intertanko,theOilCompaniesInternationalMarineForum(OCIMF),theInternationalMarineContractorsAssociation
(IMCA),theInternationalMaritimeEmployers’Committee(IMEC),theInternationalSupportVesselOwners’Association(ISOA),theInternationalParcelTankersAssociation(IPTA),theSocietyofInternationalGasTankerandTerminalOperators(SIGTTO)andtheWorldShippingCouncil(WSC).
Publications
AlargeproportionofICSresourcesisdevotedtotheproductionofpublicationsforthebenefitoftheindustry.IssuedunderthebannerofMarisecPublications,ICSpublishesover30titleswhichprovideguidanceonregulatorydevelopmentsandindustrybestpractices,especiallywithregardtosafety,environmentalprotectionandemploymentstandards.
UnderthebadgeofISF,ICScurrentlyhasanambitiousprogrammetoupdatevariouspublicationstoreflecttheentryintoforce,inJanuary2012,ofthe2010amendmentstotheIMOConventiononStandardsofTraining,CertificationandWatchkeepingforSeafarers(STCW).In2011,thisincludedpublicationoffullyupdatedGuidelinestotheSTCWConvention,followedbyrevisedonboardtrainingbooksfordeckandengineratings,whichtakeaccountofthenewSTCWgradesofAbleSeafarerDeckandEngine.Updatedonboardtrainingrecordbooksfordeckandengineofficercadets,thatwilladdressthenewSTCWcompetencestandards,areduetobepublishedinthefirsthalfof2012.Inco-operationwithitspartnerITEnergy,ISFhasalsolaunchedaneweditionofitspopularISFWatchkeepercomputersoftware,whichallowsseafarers’workandresthourrecordstobemaintainedinaccordancewithIMOandILOregulatoryrequirements,including
52
ICS/ISFPublications
2012
Available from Marisec Publications
www.marisec.orgInternational Chamber of Shipping
In
ternational Shipping Federation
![Page 55: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/55.jpg)
53
RepresentingtheGlobalShipping
Industry
![Page 56: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/56.jpg)
OrganisationalMatters
ThecurrentICSmembershipcomprisesnationalshipowners’associationsfrom36countries,representingallsectorsandtradesandover80%oftheworldmerchantfleet(seeinsidebackpage).InJanuary2012,theInternationalMaritimeEmployers’Committee(IMEC),whichengagesincollectivebargainingnegotiationswithseafarers’unions,joinedICSasanAssociateMember.
PeterHinchliffecontinuestoserveasICSSecretaryGeneral.SincehisappointmentinSeptember2010hehasalreadyoverseensomesignificantorganisationalchanges.The2011AnnualGeneralMeetingtooktheimportantdecisiontofullyintegratetheICSorganisationwiththatoftheInternationalShippingFederation(ISF).ForallintentsandpurposesICSandISFarenowthesameorganisationandthearticlesandrulesofICShavebeenamendedaccordingly.However,ICSwillcontinuetousetheseparateidentityofISFwhenrepresentingtheindustryasanemployers’organisation,forexampleatmeetingsoftheInternationalLabourOrganizationorwhendealingwithlabouraffairsquestions.
SinceJune2011,theCommitteesofICSandISFhavebeencombinedintoasinglestructure,asshownoverleaf,reportingtoasingleICSBoardofDirectors,membershipofwhichhasbeenexpandedandtowhichallFullMembersthatsubscribetobothtradeassociationandemploymentaffairsservicesarenowentitledtoberepresented.ThiswillhelptoensurethatthepositionsadoptedbyICS
trulyreflecttheconsideredviewsoftheentireglobalshippingindustry.
TheSecretariatandstaffofICSisprovidedbyMaritimeInternationalSecretariatServicesLimited(Marisec),whichiswhollyownedbyICS.MarisecalsocontinuestoprovideservicestotheInternationalSupportVesselOwners’Association(ISOA).
InOctober2011,ICSrelocatedtobrightnewofficesatStMaryAxeintheCityofLondon.InDecember,thenewofficeandmeetingfacilitieswereofficiallyopenedbytheICSChairmaninthepresenceofrepresentativesfromthevariousinternationalmaritimeorganisationswithwhomICSworksmostclosely.
The2011AnnualGeneralMeetingofICS(andthefinalAnnualGeneralMeetingofISF)washostedbytheGermanShipowners’AssociationinHamburginMay.Underthenewarticlesofassociation,thefourICSViceChairmenelectedfor2011/2012wereCaptainDirkFry(Cyprus),MrFrankLeonhardt(Germany),MrTrygveSeglem(Norway)andMrGerardoBorremeo(Philippines).AnexpandedBoardofDirectors,whichmeetsthreetimesayear,wasalsoelectedbytheICSAGM,asshownontheoppositepage.MrSpyrosMPolemis(Greece)continuedtoserveasChairmanfollowinghisre-electionin2010.
MrPolemishasservedasICSChairmanforthelastsixyearsandhasannouncedthathedoesnotintendtoseekre-electionfor2012/13.AsuccessorwillbeelectedattheICSAnnualGeneralMeetinginMay2012,whichwillbehostedbytheAustralianShipownersAssociationinPortDouglas,Queensland.
54
ICSSecretaryGeneral,
PeterHinchliffe
![Page 57: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/57.jpg)
RepresentingtheGlobalShipping
Industry
55
ICSBoardofDirectors2011-2012
ICSSecretariat
ICSChairman,SpyrosMPolemisopensthenewofficesatStMaryAxe
Australia MrNoelHart Bahamas MrChrisOliver Belgium MrPeterVierstraet Canada MrGerryCarter Cyprus CaptainDirkFry Denmark MrCarstenMortensen Finland MrJanHanses France Mr.ChristianGarin Germany MrFrankLeonhardt Greece MrAnastasiosPapagiannopoulos HongKong Mr.RobertHo Ireland MrJohnDolan Italy MrStefanoMessina Japan MrHiroshiHattori Liberia MrMarkMartecchini Mexico MrLuisOcejo Netherlands MrsKarinOrsel Norway MrTrygveSeglem Philippines MrGerardoBorromeo Singapore MrEsbenPoulsson Sweden MrLarsHöglund Turkey MrTamerKiranUnitedKingdom MrMichaelParker UnitedStates MrCharlesParks
![Page 58: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/58.jpg)
ICSOrganisationalStructure
MarineCommittee
Chairman:CaptainTrevorSmith
Singapore
FullMembersAssociateMembers
BoardofDirectors
OffshorePanel
Chairman:MrDavidBlencowe
Denmark
DangerousGoodsPanel
Chairman:MrJohnLeach
UnitedKingdom
EnvironmentSub-Committee
Chairman:MsTeresaLloyd
Australia
CanalsSub-Committee
Chairman:MrKoichiInoue
Japan
PassengerShipPanel
Chairman:MrTomStrang
UnitedKingdom
ContainerPanel
Chairman:MrMikeDownesUnitedKingdom
GasCarriersPanel
Chairman:Tobeconfirmed
BulkCarrierPanel
Chairman:MrDimitriosFafalios
Greece
ChemicalCarriersPanel
Chairman:MrJosephLudwiczak
Liberia
OilTankerPanel
Chairman:MrRogerRestaino
Liberia
Manning&TrainingCommittee
Chairman:MrTjitsoWestra
Netherlands
InsuranceCommittee
Chairman:MrMatheosLos
Greece
Construction&Equipment
Sub-CommitteeChairman:
MrMauriziod’AmicoItaly
ShippingPolicyCommittee
Chairman:MrJohnCLyras
Greece
MaritimeLawCommittee
Chairman:MrViggoBondi
Norway
LabourAffairsCommittee
Chairman:MrArthurBowring
HongKong
Radio&NauticalSub-Committee
Chairman:CaptainPaulJones
Singapore
56
![Page 59: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/59.jpg)
Members of the International Chamber of Shipping
FULL MEMBERS
AUSTRALIA Australian Shipowners Association BAHAMAS Bahamas Shipowners’ Association BELGIUM Royal Belgian Shipowners’ Association BRAZIL Syndarma•• BULGARIA Bulgarian Shipowners’ Association• CANADA Canadian Shipowners’ Association CHILE Chilean Shipowners’ Association CHINA China Ocean Shipping (Group) Co•• CROATIA Mare Nostrum, Croatian Shipowners’ Association• CYPRUS Cyprus Shipping Chamber DENMARK Danish Shipowners’ Association FINLAND Finnish Shipowners’ Association FRANCE Armateurs de France GERMANY German Shipowners’ Association GREECE Union of Greek Shipowners Hellenic Chamber of Shipping• HONG KONG Hong Kong Shipowners’ Association INDIA Indian National Shipowners’ Association IRELAND Irish Chamber of Shipping ISLE OF MAN Isle of Man Shipping Association•• ITALY Confederazione Italiana Armatori (Confitarma) JAPAN Japanese Shipowners’ Association KOREA Korea Shipowners’ Association KUWAIT Kuwait Oil Tanker Co. LIBERIA Liberian Shipowners’ Council MEXICO Grupo TMM S.A. NETHERLANDS Royal Association of Netherlands Shipowners NORWAY Norwegian Shipowners’ Association PHILIPPINES Filipino Shipowners’ Association SINGAPORE Singapore Shipping Association SPAIN Asociación de Navieros Espanoles SWEDEN Swedish Shipowners’ Association• Swedish Shipowners’ Employer Association•• SWITZERLAND Swiss Shipowners’ Association• TURKEY Turkish Chamber of Shipping UNITED KINGDOM UK Chamber of Shipping UNITED STATES Chamber of Shipping of America
ASSOCIATE MEMBERS
Abu Dhabi National Tanker Co. (Adnatco)• BW Fleet Management Pte. Ltd• Chamber of Shipping of British Columbia• Cruise Lines International Association (CLIA) European Dredging Association (EuDA) Interferry• International Maritime Employers. Committee (IMEC) Sail Training International Shipping Australia Ltd• World Shipping Council• • Trade Association Only •• Employers Organisation Only
![Page 60: Annual Review 2012](https://reader036.fdocuments.us/reader036/viewer/2022081400/5493ebb7b47959654d8b49a2/html5/thumbnails/60.jpg)
Representing the Global Shipping Industry
International Chamber of Shipping
38 St Mary AxeLondon EC3A 8BH
Tel +44 20 7090 1460Fax +44 20 70901484
www.ics-shipping.org