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Thursday, 02 January 20
SULPHUR 2020 COMPENDIUM - HOW ARE INDIVIDUAL PORT STATES EXPECTED TO REACT? - STANDARD CLUB
 KNOWLEDGE TO ELEVATE
With the new sulphur limits soon to be in force, Standard Club has been investigating the ways in which certain jurisdictions are expected to react to violations.
We contacted our local correspondents from a variety of different ports, including Brazil, China, Denmark, Norway, Panama, Spain and Sweden, to build a compilation of what we believe is useful and practical knowledge for dealing with future sulphur claims.
We asked our correspondents the following series of questions:
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Will compliant bunkers be available in your jurisdiction?
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Which government body or organisation issues fines for sulphur violations?
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What is the estimated potential value of fines?
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Is there a possibility of criminal action for sulphur violations?
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Can a ship be detained for violations? If so, will a club LOU be accepted to secure its release?
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Is it possible to appeal fines?
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What contingency measures are available for ships carrying non-compliant fuel?
The answers to these questions are as follows. If you have questions about any of these jurisdictions, or any jurisdictions which are not listed below, please contact your usual claims handler at the club for further assistance.
Brazil
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Compliant bunkers will be available in Salvador, Sao Luis, Belem and Macapa.
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Fines may be issued by the ANP, IBAMA (the Environmental Authority) or the Harbour Master´s Office at each port.
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The estimated potential fines range from BRL 5,000 to BRL 2,000,000.
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There is a possibility of criminal action for sulphur violations in Brazil.
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A ship may be detained for sulphur violations until it is proved that there are bunkers within specification on board. Acceptance of a club LOU will depend on each individual case.
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It is possible to appeal fines.
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In the event of non-compliance, the Authorities will need to verify that the off-spec bunkers have been segregated on board.
China
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Compliant bunkers should be available in China. However, members should check with local agents and the port authority before calling to confirm availability.
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The local marine authority (the MSA) issues fines for sulphur violations.
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According to the PRC Air Pollution Prevention and Control Law, shipowners may face administrative penalties ranging from RMB10,000 to RMB100,000.
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While this is unlikely, there is a possibility for criminal action in the event of serious violations.
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Ships can be detained, depending on the seriousness of the violation. It is not known whether a club LOU would be accepted.
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Appeals of fines are unlikely to be successful if a violation has in fact occurred. However, owners may apply for a review of the fine if they suspect that the administrative procedures have been incorrectly applied (i.e. there has been no violation).
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From 1 January 2020 if a ship is unable to obtain compliant bunkers she should submit a FONAR to the MSA before entering Chinese waters. From 1 March 2020 if a ship is carrying non-compliant bunkers in Chinese waters they can discharge the non-compliant bunkers, or (subject to MSA approval) retain the non-compliant bunkers on board after providing a letter of commitment not to use these bunkers in Chinese waters.
Denmark
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Compliant bunkers will be available in Denmark.
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The Port State Control and the police both administer fines for sulphur violations.
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Fines for non-compliance can range from DKK 30,000 to DKK 300,000.
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Criminal action may in some cases be brought for non-compliance. Fines are imposed by the police, following penalty proceedings and public court hearings. In cases of gross negligence, or of continuous violation of the sulphur cap, there is the possibility of imprisonment for up to two years.
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A ship can be detained until it has taken the necessary steps to ensure compliance with the sulphur content regulations. Club LOUs will not be accepted to secure release of the ship.
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Fines can be appealed through the usual judicial channels (at the Court of Appeal and potentially at the Supreme Court).
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If the ship is not compliant with the sulphur regulations, it will be asked by officials to demonstrate that it has taken adequate steps to be compliant. The owner will have to demonstrate that they have established procedures on board the ship to ensure compliance. The owner will also have to provide documentation showing their attempts to obtain compliant bunkers.
Norway
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Compliant bunkers will be available in Norway.
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The Norwegian Maritime Authority (Sjøfartsdirektoratet) issues fines for violations.
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The lowest possible fine is around NOK 79,886. Fines are typically around NOK 250,000, although this figure may be higher depending on the degree of negligence and/or guilt.
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Criminal action may be brought for violations.
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Arrest of the ship for violation of the sulphur limits is possible.
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It is possible to appeal fines to the Norwegian Ministry of Climate and Environment.
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In the event of non-compliance, compliant bunkers are available so that the non-compliant bunkers can be replaced.
Panama
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Compliant bunkers will be available in Panama.
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Fines will be administered by the Panama Maritime Authority (PMA) and the Panama Canal Authority (PCA).
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The PMA and PCA will calculate fines based on the perceived seriousness of the violation. To date, there have been no known fines by the PMA or PCA, so it is difficult to say how they will deal with these incidents.
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Currently there have not been any known criminal proceedings relating to sulphur violations.
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A ship can be detained by both the PMA and PCA for violations, although this is seen to be unlikely. The PMA has in the past been vague regarding club LOU’s but the PCA regularly accepts them for other issues.
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Administrative fines are generally unappealable.
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There are limited options for ships to debunker non-compliant fuel at Panama.
Spain
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Compliant bunkers will be available in Spain.
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The Spanish Central Government Authority issues fines for sulphur violations. The Harbour Master’s office belongs to Merchant Marine General Management, which itself belongs to the Government Ministry in charge of public work.
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There is no set figure for fines. Fines are usually around EUR 22,000 although they could be as high as EUR 180,000. In case of wilful actions, the fine could be as high as EUR 600,000. The Harbour Master will ask for a guarantee to permit the ship to sail (club LOUs are not accepted).
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In theory there is a possibility of criminal action, but only if the use of off-spec bunkers was deliberate.
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A ship can be detained for sulphur violations. In such a case, a club LOU will not be accepted. Authorities will only accept a cash deposit, a bond or a bank security issued by a Spanish Insurer or Bank.
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It is possible to appeal fines, but success is unlikely.
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Any non-compliant bunkers on board will be banned, even if not in use, and similar sanctions will be imposed unless the ship has a scrubber in good operational condition. In addition to the sampling of storage tanks, evidence of tank cleaning and a bunker delivery note will also be required on board.
Sweden
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Compliant bunkers will be available in Sweden.
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The Coast Guard will issue fines for sulphur violations.
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The estimated value of fines is still under discussion. However, there is a risk that fines may be high value to deter non-compliance with the sulphur limits.
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There are not expected to be any criminal repercussions for non-compliance, only fines.
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In very extreme cases, ships can be detained for sulphur violations. It is difficult to predict whether the authorities will accept a club LOU in this situation.
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It is possible to appeal fines.
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In the event of non-compliance, there are many well established bunker operators in the region who can handle non-compliant bunkers.
Source: Standard Club
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Wednesday, 01 July 20
COLOMBIA'S COAL EXPORT VOLUMES HAVE STEADILY DECLINED IN RECENT YEARS - BANCHERO COSTA
Colombia is the world’s fifth largest seaborne exporter of coal, coming after Australia, Indonesia, Russia and the USA.
Export ...
Wednesday, 01 July 20
MARKET INSIGHT - INTERMODAL
It was beginning of 2020 – close to 6 months from now – when we first experienced the huge impact of the COVID 19 outbreak on Ship Repa ...
Monday, 29 June 20
INDONESIAN COAL AT THE MERCY OF THE DRAGON AND TIGER - GHEE PEH | IEEFA
Coal sector analysts have been busy in recent months mapping the negative impact of low coal prices from the COVID-19 pandemic on Indonesian coal c ...
Monday, 29 June 20
FALLING DEMAND IN CHINA AND INDIA SIGNAL TOUGH TIMES AHEAD FOR INDONESIAN EXPORTS - GHEE PEH | EEFA
Assessing the Impact on Indonesian Coal Companies
The bad news for Indonesia’s coal companies is that they are likely to have ...
Monday, 29 June 20
INDIA COAL IMPORT OUTLOOK: WEAK DEMAND, IMPORT SUBSTITUTION, EXPECT 20% YOY DECLINE - GHEE PEH | IEEFA
For India, the coal demand indicators have clearly turned negative.
According to Argus Media, since the government declared a ...
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- Manunggal Multi Energi - Indonesia
- Chettinad Cement Corporation Ltd - India
- Global Coal Blending Company Limited - Australia
- Bhoruka Overseas - Indonesia
- Oldendorff Carriers - Singapore
- Meralco Power Generation, Philippines
- Indo Tambangraya Megah - Indonesia
- Borneo Indobara - Indonesia
- Renaissance Capital - South Africa
- London Commodity Brokers - England
- Kobexindo Tractors - Indoneisa
- Standard Chartered Bank - UAE
- Kideco Jaya Agung - Indonesia
- ASAPP Information Group - India
- Sindya Power Generating Company Private Ltd
- Georgia Ports Authority, United States
- Planning Commission, India
- Heidelberg Cement - Germany
- Sree Jayajothi Cements Limited - India
- Wood Mackenzie - Singapore
- Indika Energy - Indonesia
- SMG Consultants - Indonesia
- Bukit Makmur.PT - Indonesia
- Ministry of Transport, Egypt
- CIMB Investment Bank - Malaysia
- PNOC Exploration Corporation - Philippines
- GVK Power & Infra Limited - India
- Formosa Plastics Group - Taiwan
- Australian Coal Association
- Coal and Oil Company - UAE
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Sakthi Sugars Limited - India
- Semirara Mining and Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bahari Cakrawala Sebuku - Indonesia
- San Jose City I Power Corp, Philippines
- Siam City Cement PLC, Thailand
- Karaikal Port Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Sinarmas Energy and Mining - Indonesia
- Pendopo Energi Batubara - Indonesia
- Aboitiz Power Corporation - Philippines
- Energy Link Ltd, New Zealand
- Alfred C Toepfer International GmbH - Germany
- Semirara Mining Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Jaiprakash Power Ventures ltd
- Edison Trading Spa - Italy
- Kumho Petrochemical, South Korea
- Coastal Gujarat Power Limited - India
- GMR Energy Limited - India
- Binh Thuan Hamico - Vietnam
- SMC Global Power, Philippines
- India Bulls Power Limited - India
- Indian Energy Exchange, India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Independent Power Producers Association of India
- Vijayanagar Sugar Pvt Ltd - India
- CNBM International Corporation - China
- Parry Sugars Refinery, India
- Uttam Galva Steels Limited - India
- Electricity Authority, New Zealand
- Sarangani Energy Corporation, Philippines
- VISA Power Limited - India
- IHS Mccloskey Coal Group - USA
- Iligan Light & Power Inc, Philippines
- Barasentosa Lestari - Indonesia
- Star Paper Mills Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Mercuria Energy - Indonesia
- Maheswari Brothers Coal Limited - India
- Posco Energy - South Korea
- Coalindo Energy - Indonesia
- Commonwealth Bank - Australia
- Energy Development Corp, Philippines
- Indonesian Coal Mining Association
- GAC Shipping (India) Pvt Ltd
- Bukit Asam (Persero) Tbk - Indonesia
- PowerSource Philippines DevCo
- Larsen & Toubro Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Carbofer General Trading SA - India
- Goldman Sachs - Singapore
- McConnell Dowell - Australia
- Minerals Council of Australia
- Jindal Steel & Power Ltd - India
- Meenaskhi Energy Private Limited - India
- Kepco SPC Power Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Bhushan Steel Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Central Java Power - Indonesia
- Deloitte Consulting - India
- Kapuas Tunggal Persada - Indonesia
- TeaM Sual Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Petron Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Cement Manufacturers Association - India
- Thiess Contractors Indonesia
- Therma Luzon, Inc, Philippines
- Global Green Power PLC Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- South Luzon Thermal Energy Corporation
- Vedanta Resources Plc - India
- Indian Oil Corporation Limited
- Bharathi Cement Corporation - India
- ICICI Bank Limited - India
- Price Waterhouse Coopers - Russia
- Global Business Power Corporation, Philippines
- Mintek Dendrill Indonesia
- Aditya Birla Group - India
- Rio Tinto Coal - Australia
- Tata Chemicals Ltd - India
- Grasim Industreis Ltd - India
- Marubeni Corporation - India
- Riau Bara Harum - Indonesia
- Videocon Industries ltd - India
- Bukit Baiduri Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Siam City Cement - Thailand
- The State Trading Corporation of India Ltd
- Romanian Commodities Exchange
- Attock Cement Pakistan Limited
- Gujarat Sidhee Cement - India
- Port Waratah Coal Services - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- White Energy Company Limited
- Metalloyd Limited - United Kingdom
- OPG Power Generation Pvt Ltd - India
- Kartika Selabumi Mining - Indonesia
- Trasteel International SA, Italy
- Bulk Trading Sa - Switzerland
- Central Electricity Authority - India
- IEA Clean Coal Centre - UK
- Simpson Spence & Young - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Parliament of New Zealand
- Wilmar Investment Holdings
- Cigading International Bulk Terminal - Indonesia
- Medco Energi Mining Internasional
- Agrawal Coal Company - India
- Karbindo Abesyapradhi - Indoneisa
- Timah Investasi Mineral - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mercator Lines Limited - India
- Savvy Resources Ltd - HongKong
- Sical Logistics Limited - India
- Ambuja Cements Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Sojitz Corporation - Japan
- Kaltim Prima Coal - Indonesia
- Toyota Tsusho Corporation, Japan
- Madhucon Powers Ltd - India
- SN Aboitiz Power Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Thai Mozambique Logistica
- Lanco Infratech Ltd - India
- Singapore Mercantile Exchange
- Directorate Of Revenue Intelligence - India
- Power Finance Corporation Ltd., India
- PTC India Limited - India
- Merrill Lynch Commodities Europe
- Ministry of Mines - Canada
- New Zealand Coal & Carbon
- Miang Besar Coal Terminal - Indonesia
- LBH Netherlands Bv - Netherlands
- Makarim & Taira - Indonesia
- Altura Mining Limited, Indonesia
- Latin American Coal - Colombia
- Orica Mining Services - Indonesia
- Globalindo Alam Lestari - Indonesia
- Krishnapatnam Port Company Ltd. - India
- TNB Fuel Sdn Bhd - Malaysia
- Essar Steel Hazira Ltd - India
- Ministry of Finance - Indonesia
- Interocean Group of Companies - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Eastern Energy - Thailand
- The Treasury - Australian Government
- Electricity Generating Authority of Thailand
- Dalmia Cement Bharat India
- Orica Australia Pty. Ltd.
- Africa Commodities Group - South Africa
- Vizag Seaport Private Limited - India
- Malabar Cements Ltd - India
- Xindia Steels Limited - India
- Indogreen Group - Indonesia
- International Coal Ventures Pvt Ltd - India
- Anglo American - United Kingdom
- Economic Council, Georgia
- Bhatia International Limited - India
- MS Steel International - UAE
- Baramulti Group, Indonesia
- Mjunction Services Limited - India
- European Bulk Services B.V. - Netherlands
- AsiaOL BioFuels Corp., Philippines
- Antam Resourcindo - Indonesia
- Chamber of Mines of South Africa
- Holcim Trading Pte Ltd - Singapore
- Samtan Co., Ltd - South Korea
- Eastern Coal Council - USA
- Ceylon Electricity Board - Sri Lanka
- Banpu Public Company Limited - Thailand
- Australian Commodity Traders Exchange
- The University of Queensland
- Rashtriya Ispat Nigam Limited - India
- Tamil Nadu electricity Board
- Kalimantan Lumbung Energi - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Gujarat Electricity Regulatory Commission - India
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