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One of the most problematic knock-on effects of the response to the Covid-19 pandemic has been the restricted availability of labour, and by extension the inability to manufacture and transport goods. Lockdown policies enacted by many governments have resulted in the closure of plants and factories, causing supply chain deficiencies across the globe.

One possible solution is to move operations from a Covid-19 affected country, or at least to spread out manufacturing sites to create a level of resilience to a pandemic event. However, this is not without consequence. Speaking to Electronics360, Len Jelink, research vice president for components and devices at Omdia said, ‘I think we will see some supply chain diversification where companies can financially make it work, but I do not see a whole sale repositioning of the electronics industry unless we see governmental intervention or tariffs… I do not see how companies that have automated in Asia can, for example, be financially competitive while having to make duplicate investments in a new location unless governments are willing to fund those moves.’

This is a view shared by Michael Larner principal analyst for industrial and manufacturing research at ABI Research, ‘in the short term, it is unlikely the industry will see a hollowing out of manufacturing from China and Taiwan…A lift and shift approach won’t work because moving just one part of the value chain to say southeast Asia won’t help much when you still need supply of components from firms in China or Taiwan. Also, nobody knows how this virus will evolve and where another version might occur. The next hotspot could be where the manufacturer has moved their assembly lines.’

According to the International Transport Forum, ‘Covid-19 could reduce global freight transport by up to 36% by the end of 2020’. In a briefing publish on 11th May, the ITF stated ‘The current mobility and activity restrictions around the world are likely to result in a strong reduction of global freight transport volumes in 2020 of more than one third’.

‘Overall, freight transport, measured in tonne-kilometres, is projected to be 36% below the level foreseen without Covid-19 for this year. Non-urban freight activity, i.e. national and international goods transport outside of cities, could be 37% lower overall, compared with the estimate for global 2020 freight volumes without Covid-19.’

This however will not be a blanket figure across the whole world. Instead significant regional differences will occur. The ITF estimates ‘A reduction of more than half is projected for ASEAN countries, Russia/Central Asia and India. For China, the impact is just above a quarter less freight. Europe and the Americas are in the middle of the range with reductions of around 40%; only the Andean countries are projected to be hit harder, with a 50% fall in non-urban freight activity.’

The picture for localised transport is different. ‘Freight transport within cities can expect to be hit significantly less hard than national and international goods transport. Updated projections see urban freight activity at 8% below the estimate that did not yet reflect any impact from Covid-19. One reason for this is the growth of online shopping during the lockdown in many countries, which leads to more deliveries of e-commerce purchases. Associated with this phenomenon is an increased number of vehicles delivering goods in cities, despite the still significant fall in volume.’

One positive to come out of this analysis is the environmental benefit to the reduction in transportation. ‘Carbon dioxide emissions from national and international freight would be close to one third (30%) lower than projected without the impact of Covid-19. For urban freight, the drop is half as big (14.5%), yet still significant.’

The reduction in manufacturing, economic activity, and the associated decline in demand for transport have major implications for the global shipping industry. On 29th April, the ITF published analysis noted that ‘Container freight rates have remained fairly stable because carriers have idle capacity, yet the high debt level of container carriers creates insolvency risks. Any bailouts for the sector should address offloading of risks to the public.’

‘The main response of carriers to falling demand has been to reduce supply. Ship operators have massively started to idle vessels by cancelling services. These blank sailings have increased significantly compared to previous years, with 188 in February/March 2020, of which 85 were on the Asia-North America West Coast trade lane and 49 on the Asia-North Europe trade lane’.

The ITF analysis suggests that cost reductions will be vital to secure the future of shipping companies. ‘Over the past decade, carriers mitigated excess capacity by lowering ship speeds, scrapping older vessels and cancelling orders for new ships. Carriers will likely resort to a mix of similar instruments in the second and third quarter of 2020.’

‘In 2015, carriers re-routed traffic after the opening of the new Suez Canal, forcing the Canal Authority to cut rates by 65%. Now, some are again re-routing Asia-Europe services via the Cape of Good Hope to avoid Suez Canal charges, a course of action made viable by very low oil prices.’

The reduction in demand for shipping has had a knock-on effect at ports, where ‘Volumes handled in the main global container ports fell by 6% in both February and March 2020 on the previous year’.

The ITF further predict that ‘Service cancellations will cascade through the containerised transport system and reduce the number of feeder services. Carriers will transfer some of the large ships no longer needed on usual trade routes to other routes in order to optimise utilisation. This will intensify peaks and troughs in ports not used to handling these large vessels.’

One major concern for the ITF is the danger of a ‘race to the bottom’, as governments seek to use subsidies and state aid to protect the shipping industry. In the view of the ITF this could cause ‘a vicious cycle of regulatory competition for the most generous subsidies and tax exemptions. By this logic, temporary support to weather a crisis become permanent; one country’s support measures invite others to match or outdo them; and some countries will expand their support measures to increase their shipping sector’s competitiveness.’

‘The shipping subsidies introduced during Great Depression in the 1930s generally continued, even if the form and character of the aid changed over time. More recently, the aftermath of the 2008 financial crisis saw an accumulation of government support packages that generally remained in place, followed by an expansion of scope of the schemes.’

It is not however all bad news. Instead, the ITF suggests ‘Governments should use the economic leverage of the Covid-19 crisis to address these concerns. Actions could include closing tax loopholes, reducing exemptions and introducing carbon pricing for shipping.’

‘Governments could also halt the unfair competition of tax-exempt carriers with non-tax exempt companies with regards to logistics activities. They could stimulate a more crisis-resilient container shipping model that includes clear conditions regarding the value the sector creates for society, embraces environmental sustainability and internalises external costs and risks in the price of containerised ocean transport.’

This is an example of global business analysis which we are sharing as part of our global best practice resource to help you think about and determine appropriate responses locall

Source: https://www.ciltinternational.org/


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The IMO, based in London, is following the guidance from the World Health Organization (WHO) and the UK Government when it comes to planning and hosting the future meetings. At the time of writing, there is no schedule for future meetings.

Despite the postponements, IMO has, so far, retained the original deadlines for submitting papers. Normally, there are a lot of papers submitted to each meeting by the participants (member-states, NGOs etc), for example there were 102 submissions for MEPC 75.

Below you can find the most important of the postponed meetings – from the point of view of BIMCO members.

Key environmental topics postponed

The 75th session of the Marine Environment Protection Committee (MEPC75) was originally scheduled to take place at the end of March 2020. The MEPC deals with pertinent topics related to marine environment. The committee adopts new regulations and amends existing regulations.

Some important proposed amendments are up for adoption at this session:

  • MARPOL Annex VI concerning procedures for sampling and verification of the sulphur content of fuel oil and the Energy Efficiency Design Index (EEDI).
  • The BWM convention regarding commissioning testing of BWMS.

The other important topics, which will be discussed at this meeting, include the architecture of short-term GHG reduction measures, further development of a possible future phase 4 of the EEDI-regime, discussions about the industry proposal for a Research and Development programme for reduction of GHG emissions and how to reduce marine plastic litter from ships.

BIMCO does not expect the postponement to have any critical impact, although the new EEDI regulations and the procedures from sampling and verification of fuel sulphur content are important for shipowners.

Deadly serious business

The 102nd session of the Marine Safety Committee (MSC 102) was originally scheduled to take place in May. The MSC is a committee where topics related to safety and security of ships and seafarers are regulated.

Some important proposed amendments are up for adoption at this session:

  • International Maritime Dangerous Goods (IMDG) Code
  • Chapter II-1 of the International Convention for the Safety of Life at Sea (SOLAS), 1974, as amended,
  • The International Code of Safety for Ships using Gases or other Low-flashpoint Fuels (IGF Code),
  • The International Code for the Construction and Equipment of Ships Carrying Liquefied Gases in Bulk (IGC Code).

Owing to the number of fire incidents on containerships, member states asked the IMO to include the item on the MSC agenda to allow a discussion on this issue with a view of strengthening fire safety regulations of large container ships.

Also, on the table is the topic of piracy and armed robbery and security of ships in West-Africa including the Gulf of Guinea, which BIMCO and other industry associations have highlighted in a submission to the committee.

MSC 102 will continue the work on how to enhance the safety of ships relating to the use of fuel oil. The intention is to enhance the mandatory SOLAS-requirements and develop guidelines for ships on how to address situations where indicative test results suggest that the oil fuel supplied may not comply with SOLAS. In this context, BIMCO continues to advocate for a mandatory bunker licensing scheme as the only way to address fuel oil quality and safety issues.

GHG is a priority

Intersessional Working Group on Reduction of GHG Emissions from Ships, originally scheduled from 23 to 27 March 2020 has been postponed but is prioritised due to the importance of advancing the development of short-term GHG measures.

The work on GHG emissions has a deadline for short term reduction measures in 2023. If the intersessional working group and MECP 75 are held in 2020, this part of IMO’s environmental work can be finalized within this deadline.

One year away from mandatory electronic exchange

Facilitation committee 44 (FAL 44), and the IMO Expert Group on Data Harmonization, which were originally scheduled to be held in April, are going to discuss the digitalisation aspect of data exchange and how to increase the efficiency of ship-shore communications.

From April 2019, with a two year’s implementation time, new mandatory requirements on electronic exchange of information from ships to the relevant onshore parties when approaching a port, will require public authorities to have systems in place to assist ship clearance processes. These matters were high on the agenda at the postponed meetings.

BIMCO has been pushing hard for a common and uniform implementation of the data models used in the interface for ship-shore communication.

If the postponement of the FAL drags for a long time, BIMCO is concerned that the foundation electronic exchange of information will be damaged to an extent where we may have to start from scratch.

Future IMO meetings

IMO committees and sub-committees work between the sessions by correspondence. For example, a lot of the groundwork in the development of regulations and guidelines takes place between the actual physical meetings through correspondence between the interested members. When arguments for or against certain items are known well in advance of a meeting through correspondence, it is normally easier for members states to reach consensus and therefore intersessional initiatives help speed up the process.

A revised meeting programme has not yet been issued by the IMO and it is impossible to predict when physical meetings will be allowed to take place again. The IMO is considering every possible option to handle the logistical challenge of accommodating all the postponed meetings.

A priority list has been drawn up and will be considered by the thirty-second extraordinary session of the IMO Council, which is meeting by correspondence from May-July 2020. We expect that priority will be given to a regular session of the IMO Council, followed by meetings of the MEPC preceded by the Intersessional Working Group on Reduction of GHG Emissions from Ships and followed by MSC and FAL.

By prioritising the work of the two committees MSC and MEPC, the IMO tries to ensure that items that are up for adoption can take effect without interrupting already made plans and schedules and contribute to the safety at sea and protection of the environment.

Big sub-committee meeting postponement

Sub-committees that have had their meetings postponed are likely to have their work postponed by up to a year. As papers have already been submitted, IMO will have to follow normal procedure that allows a discussion on submissions. There is a limit as to how many papers can be debated during a week-long meeting, so there will probably not be room for any new submissions. Under such circumstances, the 2020 Sub-committee meetings, which were postponed, will have to take place in 2021.

The BIMCO secretariat is prepared and will be ready when IMO finds new dates for the postponed meetings.

Source:
https://www.bimco.org/news/environment-protection/20200511-imo-in-the-shadow-of-covid19


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International Registries, Inc. and its affiliates (IRI), which provide administrative and technical support to the Republic of the Marshall Islands (RMI) Maritime and Corporate Administrators, is always committed to quality client service. During these rapidly changing and challenging times, the RMI Registry remains fully operational and accessible to our clients. In addition to the normal activities of protecting life, the environment, and resources, the COVID-19 virus means the RMI Registry must now, more than ever, focus on ensuring that RMI registered ships continue trading to keep the global supply chain moving.

The RMI Registry encourages all government agencies and industry stakeholders to recognize this is a force majeure situation that will necessitate flexibility. This page will continue to be updated based on the rapidly changing COVID-19 situation.

 

RMI Registry Status

The RMI Registry is committed to responsibly facilitating the business operations of our clients around the globe. Our 28 worldwide offices are monitoring guidance from their local authorities and the World Health Organization (WHO). IRI’s network of worldwide experts including client services managers, and technical and marine safety personnel are available to provide service locally which is essential during these challenging times. While some of our offices remain open, many of our offices and team members are now working remotely and we maintain our full capability to assist clients throughout the world using normal email and phone channels without interruption.

The RMI Registry’s operations teams including Corporate, Technical, Marine Safety, Seafarers’ Documentation, Radio Station Licensing, Vessel Registration, and Vessel Documentation, remain fully manned and capable of answering questions from ship operators, shipowners, Classification Societies (Class) / Recognized Organizations (ROs), filing agents, banks, law firms and other industry stakeholders. To ensure a timely response please use the email address for the appropriate department.

As this challenging situation continues to escalate there have been many questions posed to the RMI Maritime Administrator (the “Administrator”). Please take a moment to review the following important information:

Ship Surveys and Statutory Certificates

As statutory certificates become due for periodic or renewal surveys, ship operators are requested to make all efforts to ensure certificates are valid. However, it is recognized that there may be issues securing dry-docks and repair facilities, receiving essential equipment, and organizing servicing technicians. In some cases, it may be difficult to arrange attendance from Class / ROs. It is imperative that the ship operator and Class work together to keep certificates valid using physical and remote survey techniques where possible. The Administrator has authorized International Association of Classification Society members to act on its behalf to evaluate each situation and recommend a course of action to the Administrator.

In the most extreme cases, where neither a physical attendance nor a remote survey can be organized, then the RO may recommend a period of grace of up to three months. The RO should record and track the status of any extensions and provide ships with evidence that certificates have been extended along with an explanation. While the Administrator cannot guarantee that every port State control (PSC) will accept extended certificates, this evidence may be shown to PSC. It is recommended that such evidence is also sent with any advanced notice of arrival that may be required by some coastal States.

MSA 14-20 – Handing the Validity of Ship Certificates Due to COVID-19

MSA 11-20 – Handling ISM, ISPS, and MLC, 2006 Due to the Exceptional Circumstance of COVID-19 (Updated 26 March 2020)

Technical Circular 13 – Guidelines for Extending the Period of Validity of a Certificate provides additional guidance

Ship Inspections

Alternative arrangements for vessel inspections are available to address and reduce risk. When the traditional in-person inspection is not possible, temporary arrangements will be considered in accordance with MSA 17-20. If you have an immediate question or concern regarding vessel inspections or boardings, please contact your regional office or directly send an email to the respective inspection office as noted below.

Inspections-HK@register-iri.com for those vessels needing to schedule an inspection in China, the Far East, Southeast Asia, Australia, or New Zealand.

Inspections-Busan@register-iri.com for those vessels needing to schedule an inspection in Korea and the Pacific coast of Russia.

Inspections-Dubai@register-iri.com for those vessels needing to schedule an inspection in the Middle East including Red Sea area and Gulf of Aden, India, or Pakistan.

Inspections-Roosendaal@register-iri.com for those vessels needing to schedule an inspection in Northern and Eastern Europe; Western Russia; West, Central, and Southern Africa; or Madagascar.

Inspections-Piraeus@register-iri.com for those vessels needing to schedule an inspection in the Mediterranean, Black Sea, or North Africa.

Inspections-Baltimore@register-iri.com for those vessels needing to schedule an inspection in North, Central, and South America; the Caribbean; Greenland; Guam; or the Hawaiian Islands.

Close cooperation with the regional office coordinating your inspection is greatly appreciated as we work together to reduce the risk and minimize the global impact of COVID-19 in the maritime arena.

WHO provides updates on “affected areas” and the latest status updates.

Updated guidance on vessel calls in affected ports, vessel inspections, and crew contracts may be found in MSA 12-20.

Seafarers’ Documentation Regional Office Status

Our Ft. Lauderdale, London, Manila, Mumbai, and Reston Seafarers’ Documentation teams are operational with personnel working from home. Email inquiries to these offices will receive a response. Effective 30 March 2020, please submit all paper applications to either our Piraeus or Hong Kong office to ensure timely processing of your requested documents. Documents requested through the online system, submitted to any office, will be printed and shipped from either our Hong Kong or Piraeus offices.

At present, we are not shipping seafarer documents to India, Italy, Myanmar, the Philippines, or Spain. If your receiving address is located in one of these countries, please contact us to supply an alternative delivery address for your documents.

Filing agents who submit applications online may continue to do so via remote desktop or virtual desktop infrastructure, if submitting from a remote location. If you do not have remote desktop capability, please contact seafarers@register-iri.com for guidance.

Crew Contracts

The Administrator is aware that stringent border control measures to reduce the spread of COVID-19 has resulted in operators having difficulty in arranging crew changes and repatriating seafarers when their employment agreements expire. As a result, some seafarers employed to work on RMI-flagged ships may exceed the service period as entered in their seafarer employment agreements (SEA).

The Administrator allows for extended SEAs as provided in RMI Marine Notice (MN) 7-052-2. It also recognizes in contrast to this position that some port States hold a rigid interpretation that a SEA may not be extended beyond 11 months or its original contract date, if less than that period.

The Administrator is closely monitoring the problems arising with the restriction of crew changes worldwide and will engage, if necessary, in an active dialogue with all relevant industry stakeholders to ensure the safety and security of the Registry’s seafarers and vessels.

If further guidance is required, please contact regulatoryafffairs@register-iri.com.

International Maritime Organization (IMO) Update

With many meetings of the IMO now postponed, including the Legal Committee (LEG) 107, the Marine Environment Protection Committee (MEPC) 75 and the Maritime Safety Committee (MSC) 102, the Administrator has noted there will be consequential effects with regard to work program timelines and entry into force dates for treaty amendments. Noteworthy are the expected adoption of amendments to the International Convention for the Prevention of Pollution from Ships (MARPOL) Annex VI relative to testing/verification protocols (MEPC 75/3) and approval of the revised EGCS guidelines. In this regard, the IMO secretariat will develop a revised timetable once the final number of postponed meetings are known, taking into account modalities for these re-scheduled meetings (including submission of documents, effect on amendment procedures, etc.) to ensure the work of the IMO is adequately resumed. Until then, there is no opportunity for further official discussions on the response to COVID-19 on the maritime stage at an international level in relation to implementation and enforcement of relevant IMO instruments. However, the RMI Maritime Administrator is prepared to work with the international community as required to address implementation difficulties when encountered.

Visit the IMO’s press page which highlights the work of the IMO and circular letters issued to date.

A communication from the IMO Secretary General urging a practical and pragmatic approach, in response to issues like crew changeovers, resupply, repairs, survey and certification, and licensing of seafarers can also be found here, which the Administrator fully endorses.

Implementation of IMO 2020 (0.50% fuel oil sulphur content limit)

High levels of compliance were noted with only a handful of cases reported where difficulties were encountered due to fuel oil non-availability. Ship operators are urged to remain vigilant regarding potential fuel oil quality and availability issues worldwide in the event of unforeseen supply disruptions arising from COVID-19 measures. The Administrator will continue to assess Fuel Oil Non-Availability Reports (FONAR) on a case-by-case basis and utilize discretion when evaluating what actions to take, including taking no control actions, where, despite all best efforts, the ship was unable to source compliant fuel oil.

Further guidance may be found in MN 2-013-8 and form MI-112 should be used when notifying the Administrator of a fuel oil non-availability situation.

Prohibition on Carriage of Non-Compliant Fuel

Results from an informal survey in advance of the entry into force of amendments to MARPOL Annex VI prohibiting carriage of non-compliant fuel oil on 1 March 2020 indicated a high level of readiness throughout the RMI fleet, with roughly an 80% response rate.  Broad enforcement of the carriage prohibition is expected by PSC. The Administrator has noted instances of PSC action against ships found with non-compliant fuel oil onboard. Under some circumstances, the Administrator may permit a ship to carry non-compliant fuel oil, with concurrent approval by the competent authorities for the port of destination and port of departure, as relevant, if party to MARPOL Annex VI. Such a situation may be to allow for a single, one-way, direct voyage to bunker compliant fuel oil for the ship, in accordance with Regulation 18.2.4, when compliant fuel oil is not available. IMO Circular MEPC.1/Circ.881Guidance for port State control on contingency measures for addressing non-compliant fuel oil, is to be referenced when considering options to deal with remaining non-compliant fuel oil onboard.

EGCS Installations

COVID-19 restrictions are impacting some scrubber installations planned in China, which may also be difficult in other ports should restrictions become more widespread. In several instances, due to delays in drydocking/installation, ships have requested to retain non-compliant fuel onboard past the 1 March 2020 deadline for use during installation surveys. The Administrator will continue to evaluate such requests on a case-by-case basis, but generally will support requests to retain non-compliant fuel being onboard after 1 March 2020 subject to specific conditions, evidence of which must be submitted as follows:

  1. signed agreement with the shipyard and EGCS supplier;
  2. written confirmation from the shipyard and/or makers that issues caused by the COVID-19 pandemic are the reason for the enforced delay;
  3. RO verifies the isolation and security of the non-compliant fuel and issues an occasional survey report to that effect. Validity not to exceed three months beyond 1 March 2020; and
  4. records of soundings maintained in order to confirm no consumption of non-compliant fuel.

The Administrator also recommends that destination port States are notified as relevant in line with MEPC.1/Circ.881.

Recordation of Mortgages and Other Instruments; Acknowledgements

All transactions that require the recordation of a mortgage or other instrument as well as all transactions requiring notarization or acknowledgment, where such notarization or acknowledgment cannot be done in person due to the COVID-19 pandemic and associated restrictions, may be subject to modified requirements pursuant to MN 1-004-3 and MG 1-04-1.

If further guidance is required, please contact: registrations@register-iri.com or legal@register-iri.com.

It is important to restate that the RMI Registry encourages all government agencies and industry stakeholders to recognize this is a force majeure situation, which will necessitate flexibility. This page will continue to be updated based on the rapidly changing COVID-19 situation.


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Australia has extended its travel ban on foreign nationals travelling from mainland China to 22 February, with it continuing to impose a 14-day quarantine on vessels departing the country bound for Australian ports.

The Australian federal government is regularly reviewing the situation and may further extend the restrictions beyond 22 February.

The restrictions are causing scheduling issues for Australian energy and mineral shipments, which has been compounded by bad weather and cyclones on the east and west coasts of Australia over the past two weeks.

maritime coronavirus

Vessels must declare if any of the crew has a fever, breathlessness or flu-like symptoms. If there is any sickness on vessels from mainland China within the quarantine period, then the quarantine will be restarted for a further 14 days.

Source: Argus Media

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