30 May 2016

Asian Shipowners' Association raises concerns over potential EU port levy

The Asian Shipowners' Association has called for the ratification of the Hong Kong Convention, and is in talks with the International Chamber of Shipping and the European Community Shipowners' Associations, or ECSA, on the EU's proposal to potentially introduce a levy on all ships entering EU ports to incentivize shipowners to recycle their ships in an environmentally friendly way.

"Our view is that we need only one international policy, and the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships is backed by the International Maritime Organization," secretary general of National Association of Chinese Shipowners Bob Hsu told S&P Global Platts Monday.

It was one of the issues raised during ASA's annual general meeting held in Shanghai, China on May 20.

ASA called on its members -- which include NACS -- to encourage their own governments to ratify the Hong Kong Convention "at the earliest opportunity."

The Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, or HKC, was adopted by IMO at a conference in Hong Kong in May 2009, but only a handful of the 15 ship-owning and ship scrapping nations representing 40% of the world's gross tonnage have ratified it.

HKC is aimed at ensuring that ships, when being recycled after reaching the end of their operational lives, do not pose any unnecessary risk to human health and safety or to the environment.

The EU Ship Recycling Regulation, however, incorporates the provisions of HKC and establishes an EU-approved list of recycling facilities where EU-flagged vessels will have to be scrapped.

Ship recycling yards worldwide can apply to be included on this list.

However, the guidelines in practice make it extremely challenging for these yards to be recognized under EU Regulation, said ASA and ECSA.

For one, these yards need to ensure safe working conditions, pollution control including proper downstream waste management and the enforcement of international labor rights, said environmental groups.

"Workers still do not have access to free drinking water and toilets, and there is no hospital, nor ambulance available for the estimated 20,000 workers," said Indian nongovernmental organization Paryavaran Mitra, in describing the working conditions of ship recycling workers in Alang town, India.

"Alang yards use the beaching method where pollution control is made impossible by the tide and safe working conditions cannot be ensure," it added.

India, Bangladesh, China and Pakistan are global centers of ship breaking and recycling, with Alang being the largest in the world.

Brussels-based NGO Shipbreaking Platform points out that shipowners' associations have found a convenient solution in advocating the HKC as it does not ban the beaching method -- where ships are first grounded and then dismantled, posing hazards to workers and the environment -- and it does not introduce strict rules on downstream waste management.

"Anyone can hand out Statements of Compliance [or SOCs] to ship breaking yards claiming they operate in line with the convention. While some certifiers act with more diligence, others have started to offer cheaper and quicker certifications," NGO Shipbreaking Platform's executive director Patrizia Heidegger said.

Lax certification could render the standard meaningless as in the case with ISO 30000:2009, for which most yards in India and Bangladesh were quick to produce certificates, Heidegger added.

ECSA, for its part, visited eight ship recycling yards in Alang last month and found that while the implementation of standards differed considerably among the yards, these yards have "taken the responsible path towards full compliance with the Hong Kong Convention, both in letter and spirit," said ECSA's secretary general Patrick Verhoeven.

"We want to ensure that the other yards are following these first movers so that the bar can be raised overall," said Verhoeven, adding that adopting an overly restrictive approach will discourage first movers and further delay the implementation of the IMO Hong Kong Convention.

Verhoeven called on these first movers to apply for recognition under the EU Ship Recycling Regulation, and also urged the European Commission to "assess these applications in the true spirit of the Regulation and the Convention."

Representatives from EU member states, the European Commission (DG Environment) as well as the International Chamber of Shipping were part of the delegation that visited the Alang yards in late April.

Source: platts.com. 30 May 2016

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