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There have been several high-profile cases where operators have suffered reputational and financial damage because of how their ships have been recycled at the end of the ship’s life. The absence of one international and uniformly applicable convention for the recycling of ships can make this a difficult field to navigate for operators. This article looks at the applicable conventions and makes some recommendations as to what members should consider when it comes to recycling their ships, including their obligations regarding the club.

International conventions

The Guidelines on Ship Recycling were first developed and finalised by the IMO’s Marine Environment Protection Committee and adopted by the IMO in 2003. These guidelines recognised that the safety and environmental standards at many ship recycling locations were a concern. In December 2005, the IMO agreed that it should develop a legally binding instrument for ship recycling. The Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (the Hong Kong Convention)   was adopted in 2009 to ensure that ships are recycled without endangering human health or life and the environment. The Hong Kong Convention will enter into force 24 months after the date on which 15 states, representing 40% of world merchant shipping by gross tonnage and on average 3% of recycling tonnage for the previous 10 years, have signed it. To date, not all of these conditions have been met, albeit several countries have ratified it and a few shipyards comply with it.

The European Union decided not to wait for the ratification and accession of the Hong Kong Convention. In 2013, it transposed the Hong Kong Convention in large part into EU law with the adoption of the EU Ship Recycling Regulation (ESRR). This brought forward the requirements of the Hong Kong Convention and includes additional safety and environmental requirements. From 31 December 2018, the ESRR required ships of 500gt or above sailing under an EU member state flag to use an approved ship recycling facility included in the European List and all new EU-flagged ships to have a certified Inventory of Hazardous Materials (IHM) on board. From 31 December 2020, existing EU-flagged ships and all non-EU ships calling at EU ports will require a valid and certificated IHM on board, according to the regulation.

While not global, the EU regulations are significant considering that Europe is the world’s second-largest shipowning region after China, but the European List provides only limited approved ship recycling capacity. Currently, there are 41 yards in the world that are considered acceptable for ship recycling by the EU. This includes 34 facilities in the EU and Norway, 6 facilities in Turkey and 1 facility in the USA.

In addition, when considering the recycling of ships, the export of waste is regulated under the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal (the Basel Convention). This convention was adopted in 1989 and came into force in 1992. The original purpose of the convention was to protect human health and the environment against harm caused by the disposal of waste. It was hoped that it would undermine the practice of illegally sending hazardous waste to developing countries such as India, Pakistan and Bangladesh. The convention also requires the prior informed consent of the authorities in the country receiving the ship to agree to the shipment of the waste in question on the basis that the waste (including ships for recycling) will be treated in an environmentally sound manner. As ships destined for dismantling will rarely fly the flag of the state in which they are to be recycled, this activity can represent a transboundary movement of hazardous waste. However, given the global nature of the shipping industry and the practices associated with sending end-of-life ships for recycling, there has been difficulty in applying the provisions of the Basel Convention to ship recycling.

To strengthen protection to developing countries, the Basel Convention adopted the ‘Ban Amendment’ in 1995. Following its entry into force on 5 December 2019, the Ban Amendment is legally binding on parties to the Basel Convention that have expressed their consent to be bound by it. This Ban Amendment bans the export of all hazardous waste from an OECD country to a non-OECD country (OECD is the Organisation for Economic Cooperation and Development and includes 36 countries with a high-income economy).

The European Waste Shipment Regulation (EWSR) 2006 implemented the Basel Convention Ban Amendment’s requirements at the EU level. This regulation means that no ship leaving an EU port destined for recycling (regardless of the ship’s flag state) may be exported to a non-OECD country for that purpose.

China had previously been a top choice for ‘green’ ship recycling as the ships were dismantled in dock rather than beached. According to data by the NGO Shipbreaking Platform, China was fourth in the world in 2017 in terms of shipbreaking volumes, after Bangladesh, India and Pakistan. However, the country is no longer an option for non-Chinese ships needing to be recycled. The country issued an edict in early 2018 that banned the import of ships and offshore units for recycling as part of a wider ban on importing a total of 32 different types of waste material. The regulation was effective from 31 December 2018.

Ship recycling considerations

In the absence of a universally applicable convention for ship recycling and uniform standards for safety and environmental standards at ship recycling locations, we would recommend that members:

a) select recycling yards that have a Statement of Compliance with the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (the Hong Kong Convention) or the EU Ship Recycling Regulation (ESRR) 2013

b) when selling a ship to a third party, ensure that the third party’s compliance with the Hong Kong Convention or ESRR, the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal (the Basel Convention), the Basel Ban Amendment or the European Waste Shipment Regulation (EWSR) and all other applicable regulations and licences

c) refer to additional industry guidance (eg Shipping Industry Guidelines on Transitional Measures for Shipowners Selling Ships for Recycling, International Chamber of Shipping).

We wish to remind the membership of their obligation to disclose when they intend to recycle a vessel, so that the managers can determine the appropriate point at which cover should terminate.

When a member informs the managers, the member will be asked to:

  1. provide details of the final voyage, the ship’s flag, the location of the recycling and at what point in the process title will transfer to the ‘buyer’
  2. confirm that all relevant regulations, conventions and local licences/permissions for export and recycling have been complied with/obtained.

A special loss prevention article on ship recycling will follow this one to assist members intending to recycle ships.

Conclusion

The IMO’s mission statement is

‘to promote safe, secure, environmentally sound, efficient and sustainable shipping through cooperation’.

It follows that the IMO should have a role in promoting the safe and environmentally sound recycling of ships at the end of a ship’s life. International convention will be the most effective way to uniformly address the concerns surrounding ship recycling, including hazardous substances on ships and the working and environmental conditions at the ship recycling locations.

However, the cumulative effect of the different approaches to recycling enshrined in international conventions, regional regulations, limited ‘green’ ship recycling locations and heightened risk of reputational damage if shipowners get it wrong makes the decisions taken when recycling ships critically important. If in doubt, members should seek expert advice in this respect.

Source: https://www.standard-club.com/


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Ship Execution Plan (SEP)

India aims to reduce ships’ use of single-use plastic by 90% during stays in Indian ports in the next 12 months.

On 16 October 2019, the Indian Directorate General of Shipping (DGS) issued Order No.05 of 2019 prohibiting the use of single-use plastic items onboard ships. The order prohibits the carriage of any such items onboard Indian flagged ships while foreign flagged ships are only prohibited from using any such item while at places or ports in India.

While the initial plan was to implement the order in full by 1 January 2020, DGS later decided to postpone its implementation, to allow the shipping industry time to put in place the logistical arrangements needed to comply with the new requirements.

The following changes and clarifications to the original order should be noted:

Definition of single-use plastics

The original order defines single-use plastics as “disposable plastics which are used only once before they are thrown away”. The Addendum further clarifies that the prohibition applies only to such items used onboard ships and which are completely made of plastics. DGS provides the following examples of items not covered by the prohibition:

  • tetra pak cartons with plastic caps as used for milk and juice;
  • dispensers for liquids such as shampoo, cleaning products, etc. when these are repeatedly re-used/re-filled onboard and not discarded after single use;
  • items made of biodegradable plastic with a stamp, mark or certificate from the manufacturer or something similar;
  • cargo related items and packaging;
  • essential equipment such as personal protective equipment, medical equipment, lifesaving appliances and fire-fighting equipment; and
  • for the time being, crew and passenger personnel effects.

Please refer to the original order for a generic list of single-use plastic items covered by the prohibition.

New phase-out schedule – Ship Execution Plan (SEP)

All ships are eventually required to reduce their single-use plastic use by 90% during stays in Indian ports. This will be achieved by a stepwise implementation of the prohibition and will be based on ship type and each ship’s actual inventory of single-use plastic items. To summarise:

  • All ships when at Indian ports or places must be able to present an inventory list identifying all single-use plastic items onboard that are covered by the prohibition. The deadline for establishing the inventory list is 31 January 2020 for cargo ships and 31 March 2020 for passenger ships.
  • An inventory list should identify the different types of single-use plastic items onboard but need not specify the actual number of each item onboard. As an example, the DGS explains that all plastic bags irrespective of size will be considered as one single-use plastic item.
  • For cargo ships, 50% of the items in the inventory list will be prohibited from 1 April 2020, 75% from 1 July 2020 and 90% from 1 October 2020.
  • Passenger ships are given two extra months to comply with each step of the phase-out schedule.
  • Ship operators are free to decide which items in the inventory list to place in each ‘phase-out category’ and can therefore prioritize based on each ship’s operational requirements and crews’ needs.

The DGS states that the inventory list, once prepared, should not be changed unless there is a need to correct the list.

In accordance with the above order a “Ship Execution Plan” should be available onboard in order to provide guidance on crew for Single use plastics, and to list such items to inventories.

The following types of inventories should be created regarding Single Use Plastics:

  1. Initial Inventory (Single Use plastics onboard on 31st January 2020)
  2. 10 % Inventory (these items will be used onboard at the end of implementation date)
  3. Inventory A – 50% of items of initial inventory which will not be used  after 1st April 2020
  4. Inventory B – 75% of items of initial inventory which will not be used after 1st July 2020
  5. Inventory C – 90% of items of initial inventory which will not be used after 1st October 2020.

A Single Use Plastic Log is to be completed by the ship when entering or departing Indian waters, ports or places with an attached list of Single Use Plastics onboard.

Ship Execution Plan (SEP)

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