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News / 2020/ Trident Alliance on IMO 2020: Is there really a risk of non-compliance?

Trident Alliance on IMO 2020: Is there really a risk of non-compliance?

04 Jun 2019
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Trident Alliance, a coalition of shipping owners and operators, believes much still needs to be done despite ‘good progress’ at MEP 74 and recommends the use of transparency as a tool to discourage violations:

PROGRESS HAS BEEN MADE

With only a handful of months left until the IMO’s new sulphur regulations kick in, it’s a good time to reflect on how the Trident Alliance has already made a lasting impact, and chances are improving that the IMO’s new rules will be fairly and consistently enforced around the world.

Starting back in 2015, the IMO has indeed made good progress with the development of regulations that create a foundation for successful implementation:

  • A ‘Carriage ban’ prohibiting vessels from having >0.50%S fuel onboard, unless equipped with a scrubber, or where the fuel is being carried as cargo. This regulation helps authorities enforce, because it makes it possible to determine a vessel’s compliance based on the fuels onboard, without having to prove what fuels have been consumed. The regulation was formally adopted at MEPC 73 in October with implementation on March 1st 2020.
  • A new Bunker Delivery Note format, requiring bunker suppliers to provide written confirmation that the fuel delivered is in line with MARPOL Annex VI requirements. This puts an obligation on fuel suppliers to be satisfied that any vessel they supply with fuel that has a sulphur level above 0.50% is equipped with a scrubber.

These regulations raise the stakes for any company that might try to cut corners on compliance. The risk of getting caught is increasing significantly. However, although these regulatory tools strengthen the hand of the enforcement authorities, a critical question remains: will they be put to the best possible use?

MUCH REMAINS TO BE DONE

Adopting sulphur regulations is not always enough, by itself, to achieve better environmental and health outcomes. As the cost of compliance rises, it is increasingly important for regulations to be enforced for them deliver their full benefit. Authorities have a key part to play in implementing the regulations, which includes specifying the roles and responsibilities around monitoring and inspecting, making the necessary legal preparations, determining non-compliance penalties, etc. Sufficient resources must be allocated to train staff, conduct inspections and develop effective detection methods,, and investments in the associated equipment and infrastructure must made.

Today, only about 30 of the 91 signatory nations of MARPOL Annex VI have experience from enforcing sulphur regulations – mostly the nations with Sulphur Emission Control Areas (SECAs). Evidence from the introduction of the ECAs in 2010 and the tightening of the ECA limit 2015 shows that even with generous warning, proper implementation of regulation takes time. It is crucial that all signatory stakeholders –including the national regulators in each nation – work closely to ensure the necessary regulatory and enforcement frameworks are ready for January 1, 2020. On that point, it is important to note that there is an existing legal basis within the United Nations Convention on Law of the Sea which allows for port States to assert jurisdiction over SOx violations on the high seas when dealing with flag States that do not enforce Annex VI effectively ( click here to see a list of MARPOL signatories).

The range and quality of enforcement tools have improved since the ECAs were introduced, but the 2020 global sulphur cap change, which also applies to the high seas, presents new challenges. Among the enforcement tools being further developed are remote sensing technologies. The Trident Alliance welcomes this focus and supports the adoption of reliable, new compliance detection techniques and technologies. Effective compliance detection and enforcement tools, when used in conjunction with the carriage ban, will be an important deterrent for any who are considering noncompliance.

TRANSPARENCY AS A DETERRENT

It is important that all nations, including the approx. 60 without previous sulphur enforcement experience, are ready by January 1st 2020. Even for those with prior experience in national waters (incl. Exclusive Economic Zones), it is unclear how they will they will meet their enforcement obligations on the high seas. One of the reasons it is unclear is because it is often difficult to determine how far nations have come in their 2020 preparations. There is an concerning lack of transparency from too many authorities on their enforcement arrangements.

Transparency can be a formidable enforcement tool, especially if combined with penalties for noncompliance which, to borrow from MARPOL, are ‘adequate to discourage violations’. Knowing that nations are prepared and that there are grave consequences for gross, deliberate non-compliance will focus minds and make very clear that there is simply no business case for choosing to be noncompliant.

Trident Alliance believes it is in the interest of responsible industry and other stakeholder groups for authorities to publicise the main points of their enforcement approach, including details of how penalties for non-compliance are determined.

WILL THERE REALLY BE NON-COMPLIANCE?

The level of enforcement of the 2020 global cap change and the level of compliance with it remain unknown. As long as a carrier is at risk of having to compete against the ‘one bad apple’, nothing but full compliance can be the goal of enforcement authorities. While doubt remains, there is an unacceptable risk to responsible businesses. What’s certain is the temptation for non-compliance will be significant.

Unless enforcement is seen to be robust from the start, can optimal levels of compliance with all its benefits really be expected?

Source: Trident Alliance
Published: 4 June, 2019

 

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