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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, 31 July 19
SHIPPING MARKET INSIGHT - INTERMODAL
It was a fairly busy week in the dry S&P market. Despite the ease of Capesize rates which impacted Panamaxes as well, interest from potential b ...
Sunday, 28 July 19
ULTRAMAX - INDONESIAN COAL CARGOES SAW A 63,000DWT SHIP FIXING DELIVERY FOR A SOUTH CHINA TRIP VIA INDONESIA, REDELIVERY CHINA, AT $11,700 - BALTIC BRIEFING
Capesize
The market was a white knuckled ride this past week as a large downside movement shed value quickly leaving many in bewilderment. The ...
Wednesday, 24 July 19
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.27 PCT - XINHUA
China Taiyuan coal transaction price index stood at 138.78 points Monday, down 0.27 percent week on week.
The index, released by Chi ...
Wednesday, 24 July 19
SHIPPING MARKET INSIGHT - INTERMODAL
Tonnes of ink has been spent analysing the rebound of the dry bulk market the last weeks with the most representative example being the rising perf ...
Wednesday, 24 July 19
COAL'S DEMISE QUICKENS IN EUROPE AS MARKET SHIFT IDLES PLANTS - BLOOMBERG
Commodity markets are stripping away the case for coal in Europe, moving quicker than government efforts to close the most polluting power plants.
...
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- Trasteel International SA, Italy
- Cement Manufacturers Association - India
- Sarangani Energy Corporation, Philippines
- Tata Chemicals Ltd - India
- Singapore Mercantile Exchange
- Anglo American - United Kingdom
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Renaissance Capital - South Africa
- Pendopo Energi Batubara - Indonesia
- Energy Link Ltd, New Zealand
- London Commodity Brokers - England
- Economic Council, Georgia
- Vijayanagar Sugar Pvt Ltd - India
- Bharathi Cement Corporation - India
- OPG Power Generation Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Maheswari Brothers Coal Limited - India
- Semirara Mining and Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Agrawal Coal Company - India
- Gujarat Electricity Regulatory Commission - India
- The University of Queensland
- IEA Clean Coal Centre - UK
- Australian Coal Association
- Aditya Birla Group - India
- Mercator Lines Limited - India
- Metalloyd Limited - United Kingdom
- Altura Mining Limited, Indonesia
- Bukit Makmur.PT - Indonesia
- ASAPP Information Group - India
- Grasim Industreis Ltd - India
- Intertek Mineral Services - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sojitz Corporation - Japan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Straits Asia Resources Limited - Singapore
- Videocon Industries ltd - India
- Dalmia Cement Bharat India
- Mjunction Services Limited - India
- Global Green Power PLC Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Kartika Selabumi Mining - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Energy Development Corp, Philippines
- Aboitiz Power Corporation - Philippines
- Kepco SPC Power Corporation, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Ceylon Electricity Board - Sri Lanka
- Ind-Barath Power Infra Limited - India
- Kapuas Tunggal Persada - Indonesia
- Latin American Coal - Colombia
- Karbindo Abesyapradhi - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Meralco Power Generation, Philippines
- Eastern Coal Council - USA
- Ministry of Transport, Egypt
- Barasentosa Lestari - Indonesia
- TeaM Sual Corporation - Philippines
- Toyota Tsusho Corporation, Japan
- Indika Energy - Indonesia
- Kobexindo Tractors - Indoneisa
- Petron Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Star Paper Mills Limited - India
- Goldman Sachs - Singapore
- Chamber of Mines of South Africa
- Kumho Petrochemical, South Korea
- Eastern Energy - Thailand
- Oldendorff Carriers - Singapore
- Antam Resourcindo - Indonesia
- Ambuja Cements Ltd - India
- Indogreen Group - Indonesia
- SMC Global Power, Philippines
- Xindia Steels Limited - India
- Parry Sugars Refinery, India
- Orica Australia Pty. Ltd.
- Mercuria Energy - Indonesia
- IHS Mccloskey Coal Group - USA
- CIMB Investment Bank - Malaysia
- Minerals Council of Australia
- Bhoruka Overseas - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Vedanta Resources Plc - India
- South Luzon Thermal Energy Corporation
- International Coal Ventures Pvt Ltd - India
- Ministry of Mines - Canada
- Jorong Barutama Greston.PT - Indonesia
- Global Business Power Corporation, Philippines
- Planning Commission, India
- Medco Energi Mining Internasional
- Savvy Resources Ltd - HongKong
- Merrill Lynch Commodities Europe
- Indian Oil Corporation Limited
- Mintek Dendrill Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Romanian Commodities Exchange
- Posco Energy - South Korea
- LBH Netherlands Bv - Netherlands
- Bukit Asam (Persero) Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- Timah Investasi Mineral - Indoneisa
- Thai Mozambique Logistica
- Jindal Steel & Power Ltd - India
- Meenaskhi Energy Private Limited - India
- Banpu Public Company Limited - Thailand
- Lanco Infratech Ltd - India
- Indo Tambangraya Megah - Indonesia
- ICICI Bank Limited - India
- Jaiprakash Power Ventures ltd
- Electricity Generating Authority of Thailand
- Maharashtra Electricity Regulatory Commission - India
- Wilmar Investment Holdings
- Vizag Seaport Private Limited - India
- Deloitte Consulting - India
- White Energy Company Limited
- PetroVietnam Power Coal Import and Supply Company
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Formosa Plastics Group - Taiwan
- Heidelberg Cement - Germany
- Sinarmas Energy and Mining - Indonesia
- Bulk Trading Sa - Switzerland
- Asmin Koalindo Tuhup - Indonesia
- Indian Energy Exchange, India
- Georgia Ports Authority, United States
- Wood Mackenzie - Singapore
- Indonesian Coal Mining Association
- GAC Shipping (India) Pvt Ltd
- Coal and Oil Company - UAE
- Bhushan Steel Limited - India
- Malabar Cements Ltd - India
- McConnell Dowell - Australia
- Baramulti Group, Indonesia
- PTC India Limited - India
- Manunggal Multi Energi - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Africa Commodities Group - South Africa
- Central Java Power - Indonesia
- Coalindo Energy - Indonesia
- Binh Thuan Hamico - Vietnam
- SMG Consultants - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kaltim Prima Coal - Indonesia
- The State Trading Corporation of India Ltd
- Sical Logistics Limited - India
- CNBM International Corporation - China
- Bhatia International Limited - India
- Thiess Contractors Indonesia
- San Jose City I Power Corp, Philippines
- Electricity Authority, New Zealand
- Sakthi Sugars Limited - India
- Billiton Holdings Pty Ltd - Australia
- PNOC Exploration Corporation - Philippines
- Attock Cement Pakistan Limited
- Iligan Light & Power Inc, Philippines
- Simpson Spence & Young - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Bangladesh Power Developement Board
- Standard Chartered Bank - UAE
- Chettinad Cement Corporation Ltd - India
- Independent Power Producers Association of India
- Tamil Nadu electricity Board
- Bukit Baiduri Energy - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- AsiaOL BioFuels Corp., Philippines
- Kohat Cement Company Ltd. - Pakistan
- European Bulk Services B.V. - Netherlands
- Gujarat Sidhee Cement - India
- Riau Bara Harum - Indonesia
- VISA Power Limited - India
- Salva Resources Pvt Ltd - India
- Port Waratah Coal Services - Australia
- Price Waterhouse Coopers - Russia
- Siam City Cement PLC, Thailand
- Orica Mining Services - Indonesia
- Marubeni Corporation - India
- Madhucon Powers Ltd - India
- Edison Trading Spa - Italy
- Sindya Power Generating Company Private Ltd
- Gujarat Mineral Development Corp Ltd - India
- Global Coal Blending Company Limited - Australia
- Bayan Resources Tbk. - Indonesia
- Borneo Indobara - Indonesia
- GMR Energy Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Therma Luzon, Inc, Philippines
- New Zealand Coal & Carbon
- Uttam Galva Steels Limited - India
- Kideco Jaya Agung - Indonesia
- MS Steel International - UAE
- Siam City Cement - Thailand
- Rio Tinto Coal - Australia
- Miang Besar Coal Terminal - Indonesia
- GVK Power & Infra Limited - India
- Cigading International Bulk Terminal - Indonesia
- Semirara Mining Corp, Philippines
- Essar Steel Hazira Ltd - India
- PowerSource Philippines DevCo
- Ministry of Finance - Indonesia
- Central Electricity Authority - India
- GN Power Mariveles Coal Plant, Philippines
- Makarim & Taira - Indonesia
- Larsen & Toubro Limited - India
- Karaikal Port Pvt Ltd - India
- India Bulls Power Limited - India
- Interocean Group of Companies - India
- Parliament of New Zealand
- Power Finance Corporation Ltd., India
- Commonwealth Bank - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Australian Commodity Traders Exchange
- SN Aboitiz Power Inc, Philippines
- Directorate Of Revenue Intelligence - India
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