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NorthStandard: Increased risk of significant customs fines for incorrect bunker declarations

Custom fines over EUR 1 million are being reported in Senegal regarding allegedly incorrect declarations of any property on the ship including any apparent bunker shortages.
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Global marine insurer NorthStandard on Tuesday (9 May) released an article on custom fines over EUR 1 million are being reported in, Senegal and the port of Dakar, in particular regarding allegedly incorrect declarations of any property on the ship (including any apparent bunker shortages), crew and cargo:

The situation has become more challenging as the grounds on which fines are levied have become increasingly diverse and the amount of the fines imposed are reaching high levels.

Ships calling at Dakar may be subjected to customs fines and/or detention for any alleged inaccuracies in documents and declarations.  Examples include the following:

  • Deficits in the cargo manifest (including goods to be discharged in Dakar, as well as any cargo in transit);
  • Errors in the bills of lading;
  • Incorrect list of ports of call;
  • Errors in the crew list;
  • Errors in the list of crew personal effects;
  • Incorrect inventory of the bonded store;
  • Failure to declare the correct amount of food supplies, paint, or chemicals on board;
  • Failure to have the required number of fire extinguishers on board;
  • Failure to declare the amount of carbon dioxide (CO2) and foam concentrate contained within the vessel’s fixed fire extinguishing systems;
  • Failure to declare the quantity of “used oil”, including fuel oil contained within piping, lube oil contained in the engine sump tank and pumps, hydraulic oil in pressure tanks for windlass and winches, etc.; and,
  • Failures in the bunker declaration form, such as incorrectly detailing quantities of lube oil, diesel oil and fuel oil or quantities contained in tanks (including sump tanks), drums, cans and sludge.

The customs authorities closely examine the ship’s documents and declarations and check these against the actual cargo and/or property on board the ship by taking their own soundings and carrying out their own inspections.  Strict penalties are imposed in accordance with the local Customs Code if any discrepancies are found. Even minor errors such as typos, incorrect use of capital letters and misplaced commas are attracting substantial fines.  Acting in good faith is not accepted as an excuse.

It is also common for the customs authorities to impose customs fines where there is any shortage or excess of bagged, liquid or bulk cargo discharged from the ship. These fines are calculated based on the quantity and/or number of bags or weight recorded by a surveyor appointed by the customs authorities.  However, the tallies of bagged cargoes are usually made ashore alongside the ship before the cargo is loaded onto trucks rather than in the cargo holds.

Fines can also be imposed by the immigration authorities for errors in the crew list, passenger list, ports of call list (previous and next ports), and stowaways list (if any). Even spelling errors have led to penalties being imposed in the past.  However, these fines are less common and are usually not substantial.

In the light of this increase in fines, the club’s local correspondents recommend that members and masters take the following precautions:

  • Before arriving in the port, members should consult local agents for the latest requirements;
  • Complete the customs declaration before arriving in the port;
  • Ensure that all the items listed above including personal belongings of crew, food, ship’s stores, fire extinguishers, CO2, bunkers, and paint are accurately described in the declaration;
  • Ensure that all crewmembers’ passports are valid, and the seamen’s books are correctly filled and updated;
  • Prepare a file containing all the relevant documents and ask the vessel’s agent to come on board to check same before the customs officers arrive;
  • The master and the ship’s agent should personally receive customs officers and should carry out the formalities on board in their presence;
  • Ensure that any modification to the manifest has been made correctly;
  • Do not sign any document from the customs authorities which you do not fully understand;
  • Avoid attempting to argue or negotiate with the customs officers as they may well interpret any such efforts as an attempt to corrupt state officials, which is a punishable offence;
  • In order to minimise any exposure to fines for cargo shortages, a draft survey or tally of bagged cargoes should be carried out with all parties invited to attend; and,
  • Contact the club and a P&I correspondent for assistance in case of need; this can aid in possibly having the fine reduced and provide notice to the club in the event security needs to be supplied to release the ship.

In the event that a fine is or is likely to be imposed, the member should contact the club and the local correspondent immediately.  The local correspondent can review the fine and attempt to negotiate a reduction.  If the fine is not agreed prior to the ship departing, a bank guarantee or ‘promissory letter’ from the local correspondents is usually required.  It is therefore important to engage the club and local correspondent as soon as possible following any incident.

The International Group is currently working with the Maritime Anti-Corruption Network (MACN) on a resolution.

 

Photo credit: Shaah Shahidh on Unsplash
Published: 15 May, 2023

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Business

Singapore: Maritime Census 2023 survey deadline extended to 23 October 

‘MPA is conducting an annual survey to collect timely statistics on the maritime industry’s activities, technology, sustainability and manpower developments,’ says the port authority.

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September 28, 2023

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SG bunker tanker sailing Photo by Manifold Times

The Maritime and Port Authority of Singapore (MPA) on Wednesday (27 September) said the Maritime Census 2023 survey deadline has been extended to 23 October. 

“MPA is conducting an annual survey to collect timely statistics on the maritime industry’s activities, technology, sustainability and manpower developments,” it said in a social media post. 

Maritime firms selected for the survey will be notified by email or post to complete the survey online via go.gov.sg/mpasurvey . 

“Your participation will help us shape policies and programmes that will drive #MaritimeSG forward,” it added. 

Manifold Times previously reported MPA announcing it was conducting the census to collect timely statistics. 

Related: Singapore: MPA conducts Maritime Census 2023 to collect timely statistics

Photo credit: Maritime and Port Authority of Singapore
Published: 28 September, 2023

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Alternative Fuels

GCMD, BCG survey highlights three maritime decarbonisation archetypes

Survey identified three decarbonisation archetypes within the shipping industry, differentiated in their outlook, investment appetite and the challenges faced.

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September 28, 2023

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RESIZED Venti Views on Unsplash ship vessel

The Global Centre for Maritime Decarbonisation (GCMD) and Boston Consulting Group (BCG) conducted an industry survey to take stock of shipowners and operators’ progress in establishing six elements needed for the shipping industry to reach net zero, according to BCG on Wednesday (27 September). 

The survey saw strong participation from 128 shipowners and operators across vessel types, fleet sizes and geographies, which collectively own or operate 14,000 merchant vessels, and account for USD500 billion in revenue.

The duo found high decarbonisation ambitions: Most respondents viewed net zero as a strategic priority, and 77% had already set concrete decarbonisation targets. The industry has also mobilised resources to decarbonise: respondents are investing 2% of their revenues into green initiatives, and 87% have personnel working toward green objectives.

The path to net zero for shipowners and operators requires six elements:

  • A robust strategy and roadmap
  • Four specific decarbonisation levers to reduce emissions: operational efficiency, technological efficiency, fuel transition, and shipboard carbon capture
  • Enablers such as dedicated sustainability teams, strategic investments in green initiatives, internal carbon prices, and digitalization

While the industry has made some progress in adopting mature and cost-effective efficiency levers, adoption of complex or nascent levers remains low. Drop-in green fuels are constrained by costs and supply-side gaps, and optimism for future cleaner fuels is yet to translate into firm commitment.

The industry is now at a pivotal point, with many shipowners and operators ramping up their decarbonisation efforts. Three-quarters of respondents plan to increase investments in green initiatives. Stakeholders can build on this momentum with a variety of supportive actions. But to be effective, they need to tailor their interventions to address the specific challenges that shipowners and operators face at each stage of decarbonisation.

Three Decarbonisation Archetypes

GCMD and BCG saw three archetypes, differentiated in their outlook, investment appetite, and the challenges faced.

Frontrunners have the greatest ambitions and are willing to invest heavily. They are pushing boundaries, adopting even nascent decarbonisation levers, such as wind propulsion and air lubrication. A majority plan to pilot shipboard carbon capture solutions by 2025. Frontrunners are also planning to adopt methanol and ammonia as early as 2026 and 2029 respectively, and the availability of fuels and bunkering infrastructure will be critical to enabling adoption.

Followers believe in decarbonising their fleets, but have tighter investment thresholds and a near-term outlook. They have kept pace with Frontrunners in adopting mature and cost-effective efficiency levers, such as main engine improvements and slow steaming, but are behind in the adoption of nascent levers, such as wind propulsion and air lubrication.

Conservatives are still early in their decarbonisation journey, likely due to a lack of awareness and familiarity with the various decarbonisation levers, and the capabilities to assess and deploy them. They are best supported by measures that increase their familiarity with the levers and help contextualise them to their specific fleets and operational requirements.

The research highlights five key actions for stakeholders:

Conduct technical pilots and facilitate data sharing, especially for nascent levers

  • Create innovative financing mechanisms to de-risk adoption of less mature levers
  • Raise awareness, contextualize levers, and build capabilities, especially among Conservatives
  • Start to build out future fuels infrastructure at ports
  • Develop mechanisms to equalize and share the costs of levers across the ecosystem
  • Maritime decarbonization is a complex, critical endeavor. The successful implementation of these five key actions demands a whole-of-value-chain approach. By working together, stakeholders can transform the maritime sector into a beacon of environmental stewardship, and set a course for a greener future where decarbonization and commercial success go hand in hand.

Note: The GCMD-BCG Global Maritime Decarbonisation Survey report can be downloaded here.

Photo credit: Venti Views on Unsplash
Published: 28 September, 2023

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Ammonia

Itochu enters MoU with firms for study of ammonia bunkering safety for container carrier

Through this cooperation, several companies and organisations will come together to discuss and study safety issues during ammonia bunkering of a container carrier that uses ammonia as a bunker fuel.
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September 28, 2023

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Itochu enters MoU with firms for study of ammonia bunkering safety for container carrier

Tokyo-based Itochu Corporation on Tuesday (22 September) said it has executed a Memorandum of Understanding for a joint study of ammonia bunkering safety for an ammonia-fuelled container carrier among eight companies and organisations with the aim of implementing the use of ammonia as a bunker fuel in shipping industry. 

Through this cooperation, several companies and organisations will come together to discuss and study safety issues during ammonia bunkering of a container carrier that uses ammonia as a main fuel.

“This MOU for Ammonia Bunkering Safety for Container Carrier is an important milestone for social implementation of the use of ammonia as marine fuel on a global scale, and also a necessary step toward the realisation of the Integrated Project consisting of the construction of a global ammonia supply chain and the development of ammonia-fuelled ships by ITOCHU and its partner companies,” the firm said in a statement. 

A joint study that will be carried out under the MOU is a successive phase of the existing Joint Study Framework launched in 2021 by 34 companies and organizations including ITOCHU and Joint Study Framework for Ammonia Bunkering Safety launched in 2022 by 16 companies and organizations including ITOCHU, and focused on discussion and study of safety issues of ammonia bunkering to ammonia-fueled container carriers among experts from port authorities, container liner operators, bunkering related players and shipping company. 

A key subject of the joint study under this MOU for Ammonia Bunkering Safety for Container Carrier is the safety assessment for simultaneous operations of container cargo operations and ammonia bunkering in a container terminal, which is generally required for container carriers to achieve operational efficiencies.

ITOCHU said it is promoting a development of ammonia-fueled container carriers with potential partners following the development of ammonia-fuelled bulk carrier, which obtained Approval in Principle in 2022. ITOCHU will accelerate the development of an ammonia-fueled container carrier based on findings of this MOU for Ammonia Bunkering Safety for Container Carrier and plans to bring it to the international shipping market in late 2020s.

ITOCHU will accelerate the development of sustainable energy systems through these initiatives and ensure its contributions to the SDGs and improvement of related efforts, one of the basic policies laid out in its new medium-term management plan, as the company pursues a low-carbon society.

The eight companies and organisations are; Algeciras Bay Port Authority, Spain; Port of Rotterdam, Netherlands; CMA CGM, France; A.P.Moller Maersk A/S, Denmark; Mitsui O.S.K. Lines, Japan; Pavilion Energy Singapore, Singapore; TotalEnergies Marine Fuels, Singapore; and ITOCHU. 

Related: Itochu-led joint study of ammonia as an alternative marine fuel expands to 34 players
Related: 23 industry players participate in joint study of ammonia as an alternative marine fuel
Related: Singapore: Pavilion Energy, MOL, Total join Itochu and Vopak ammonia bunker fuel study
Related: Spain: Itochu, Peninsula enter MOU for joint development of ammonia bunkering in Gibraltar Strait
Related: Japan: “K” Line, ITOCHU and partners receive ClassNK AiP for ammonia-fuelled bulk carrier

Photo credit: Itochu Corporation
Published: 28 September, 2023

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