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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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Monday, 29 June 20
CHINA COAL IMPORT OUTLOOK: MANY MOVING PARTS, FORECAST TO FALL 10% YOY - GHEE PEH | IEEFA
China’s coal demand declined in the first quarter of 2020. According to the China National Coal Association, the country consumed 870mt in th ...
Monday, 29 June 20
ULTRAMAX: A 58,000 FIXING DELIVERY SINGAPORE TRIP, VIA EAST COAST INDIA, REDELIVERY CHINA IN THE LOW $12,000S - BALTIC BRIEFING
Capesize
As the halfway mark of 2020 arrives, the capesize market is making new highs for the year. From persistent lows earlier caused by a ba ...
Saturday, 27 June 20
CHINA'S BENCHMARK POWER COAL PRICE REMAINS FLAT - XINHUA
China’s benchmark power coal price remained flat during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Friday, 26 June 20
WHAT TODAY'S BAILOUTS CAN DO FOR TOMORROW'S ECONOMIES - WORLD ECONOMIC FORUM
The COVID-19 crisis provides an opportunity for governments to build fairer, more sustainable and more resilient economies.
Governments a ...
Thursday, 25 June 20
ALL YOU WANT TO KNOW ABOUT COAL MINE AUCTIONS - THE HINDU BUSINESS LINE
Last week, Prime Minister Narendra Modi threw open the auction of 41 coal blocks for commercial mining. The decision, which was part of the announc ...
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- Madhucon Powers Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Riau Bara Harum - Indonesia
- Parliament of New Zealand
- Sindya Power Generating Company Private Ltd
- Ind-Barath Power Infra Limited - India
- SMC Global Power, Philippines
- London Commodity Brokers - England
- Kaltim Prima Coal - Indonesia
- VISA Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Attock Cement Pakistan Limited
- Semirara Mining Corp, Philippines
- Mercuria Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Georgia Ports Authority, United States
- Aboitiz Power Corporation - Philippines
- Intertek Mineral Services - Indonesia
- Timah Investasi Mineral - Indoneisa
- Altura Mining Limited, Indonesia
- Larsen & Toubro Limited - India
- Siam City Cement PLC, Thailand
- Maharashtra Electricity Regulatory Commission - India
- Interocean Group of Companies - India
- Price Waterhouse Coopers - Russia
- TeaM Sual Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Uttam Galva Steels Limited - India
- Wood Mackenzie - Singapore
- Trasteel International SA, Italy
- Kideco Jaya Agung - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Maheswari Brothers Coal Limited - India
- Rashtriya Ispat Nigam Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Deloitte Consulting - India
- International Coal Ventures Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Cement Manufacturers Association - India
- Therma Luzon, Inc, Philippines
- Central Java Power - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Marubeni Corporation - India
- Orica Mining Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- GAC Shipping (India) Pvt Ltd
- Kepco SPC Power Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Asmin Koalindo Tuhup - Indonesia
- Grasim Industreis Ltd - India
- Romanian Commodities Exchange
- Formosa Plastics Group - Taiwan
- Coal and Oil Company - UAE
- PetroVietnam Power Coal Import and Supply Company
- White Energy Company Limited
- Posco Energy - South Korea
- Borneo Indobara - Indonesia
- Standard Chartered Bank - UAE
- Dalmia Cement Bharat India
- Indian Energy Exchange, India
- Bangladesh Power Developement Board
- Bayan Resources Tbk. - Indonesia
- Alfred C Toepfer International GmbH - Germany
- SMG Consultants - Indonesia
- Merrill Lynch Commodities Europe
- Ambuja Cements Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Thai Mozambique Logistica
- Ministry of Mines - Canada
- Neyveli Lignite Corporation Ltd, - India
- LBH Netherlands Bv - Netherlands
- Indogreen Group - Indonesia
- India Bulls Power Limited - India
- CIMB Investment Bank - Malaysia
- Bahari Cakrawala Sebuku - Indonesia
- Globalindo Alam Lestari - Indonesia
- Chamber of Mines of South Africa
- Baramulti Group, Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Bhushan Steel Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Transport, Egypt
- Bukit Makmur.PT - Indonesia
- Malabar Cements Ltd - India
- Indika Energy - Indonesia
- Indonesian Coal Mining Association
- Mjunction Services Limited - India
- Australian Coal Association
- Renaissance Capital - South Africa
- San Jose City I Power Corp, Philippines
- Gujarat Sidhee Cement - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Finance - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Samtan Co., Ltd - South Korea
- Minerals Council of Australia
- Australian Commodity Traders Exchange
- Indian Oil Corporation Limited
- Karbindo Abesyapradhi - Indoneisa
- Directorate Of Revenue Intelligence - India
- Vijayanagar Sugar Pvt Ltd - India
- Coalindo Energy - Indonesia
- Energy Development Corp, Philippines
- Parry Sugars Refinery, India
- Videocon Industries ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Vizag Seaport Private Limited - India
- Wilmar Investment Holdings
- Sarangani Energy Corporation, Philippines
- Global Business Power Corporation, Philippines
- Bhoruka Overseas - Indonesia
- Vedanta Resources Plc - India
- Indo Tambangraya Megah - Indonesia
- Manunggal Multi Energi - Indonesia
- Iligan Light & Power Inc, Philippines
- Banpu Public Company Limited - Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Eastern Energy - Thailand
- Karaikal Port Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Electricity Authority, New Zealand
- Thiess Contractors Indonesia
- Goldman Sachs - Singapore
- Oldendorff Carriers - Singapore
- Africa Commodities Group - South Africa
- Barasentosa Lestari - Indonesia
- Commonwealth Bank - Australia
- New Zealand Coal & Carbon
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- Latin American Coal - Colombia
- Meralco Power Generation, Philippines
- Economic Council, Georgia
- Sree Jayajothi Cements Limited - India
- SN Aboitiz Power Inc, Philippines
- Pendopo Energi Batubara - Indonesia
- Orica Australia Pty. Ltd.
- Petrochimia International Co. Ltd.- Taiwan
- Eastern Coal Council - USA
- PNOC Exploration Corporation - Philippines
- Mercator Lines Limited - India
- Straits Asia Resources Limited - Singapore
- Bukit Baiduri Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Rio Tinto Coal - Australia
- Kobexindo Tractors - Indoneisa
- IEA Clean Coal Centre - UK
- McConnell Dowell - Australia
- Lanco Infratech Ltd - India
- Jindal Steel & Power Ltd - India
- Meenaskhi Energy Private Limited - India
- CNBM International Corporation - China
- Kumho Petrochemical, South Korea
- OPG Power Generation Pvt Ltd - India
- Salva Resources Pvt Ltd - India
- PowerSource Philippines DevCo
- Essar Steel Hazira Ltd - India
- Krishnapatnam Port Company Ltd. - India
- AsiaOL BioFuels Corp., Philippines
- Billiton Holdings Pty Ltd - Australia
- Medco Energi Mining Internasional
- Jaiprakash Power Ventures ltd
- Sakthi Sugars Limited - India
- Heidelberg Cement - Germany
- GMR Energy Limited - India
- Global Green Power PLC Corporation, Philippines
- ICICI Bank Limited - India
- GVK Power & Infra Limited - India
- Bhatia International Limited - India
- ASAPP Information Group - India
- Singapore Mercantile Exchange
- Aditya Birla Group - India
- MS Steel International - UAE
- PTC India Limited - India
- Bharathi Cement Corporation - India
- Kohat Cement Company Ltd. - Pakistan
- South Luzon Thermal Energy Corporation
- Planning Commission, India
- Independent Power Producers Association of India
- Power Finance Corporation Ltd., India
- Holcim Trading Pte Ltd - Singapore
- Kartika Selabumi Mining - Indonesia
- Central Electricity Authority - India
- Sojitz Corporation - Japan
- European Bulk Services B.V. - Netherlands
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sical Logistics Limited - India
- Tata Chemicals Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Binh Thuan Hamico - Vietnam
- Tamil Nadu electricity Board
- Anglo American - United Kingdom
- Star Paper Mills Limited - India
- Gujarat Electricity Regulatory Commission - India
- Toyota Tsusho Corporation, Japan
- Chettinad Cement Corporation Ltd - India
- The Treasury - Australian Government
- Mintek Dendrill Indonesia
- Coastal Gujarat Power Limited - India
- The University of Queensland
- Edison Trading Spa - Italy
- Petron Corporation, Philippines
- Carbofer General Trading SA - India
- Siam City Cement - Thailand
- Electricity Generating Authority of Thailand
- Xindia Steels Limited - India
- Antam Resourcindo - Indonesia
- Savvy Resources Ltd - HongKong
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Energy Link Ltd, New Zealand
- The State Trading Corporation of India Ltd
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Makarim & Taira - Indonesia
- Bulk Trading Sa - Switzerland
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