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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, 06 February 19
THE BDI HAS EASED BACK TO 645 BP, ITS LOWEST LEVEL SINCE AUGUST 2016 - ALLIED
The dry bulk sector is in the doldrums, with most market participants seemingly left utterly perplexed, and simultaneously, in pursuit of any posit ...
Monday, 04 February 19
COAL STILL IN HIGH DEMAND GLOBALLY
Although the world is switching to renewable energy there is still a big demand for coal around the globe.
This is according to Cany ...
Friday, 01 February 19
ULTRAMAX WAS FIXED DELIVERY KALIMANTAN, FOR TRIP TO WEST COAST INDIA AT $7,000 - BALTIC BRIEFING
Capesize
The Vale dam tragedy sparked a sharp fall in rates across all regions even where tonnage remained tight. The potential loss of product ...
Friday, 01 February 19
SEMBCORP SELECTS NORDEN FOR LONG-TERM INDIAN CONTRACT
NORDEN A/S has signed a 10-year Panamax Contract of Affreightment (COA) with Indian utility firm Sembcorp Energy India Ltd.
From 1 A ...
Tuesday, 29 January 19
HARD COAL BEARS THE BRUNT OF THE RECOMMENDATIONS OF THE COMMISSION GROWTH STRUCTURAL CHANGE AND EMPLOYMENT - VDKI
Press Release: Hard coal bears the brunt of the recommendations of the Commission Growth Structural change and employment.
In its fi ...
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- London Commodity Brokers - England
- Minerals Council of Australia
- European Bulk Services B.V. - Netherlands
- Global Coal Blending Company Limited - Australia
- Vedanta Resources Plc - India
- Indonesian Coal Mining Association
- Rio Tinto Coal - Australia
- The University of Queensland
- Jindal Steel & Power Ltd - India
- Meenaskhi Energy Private Limited - India
- Cigading International Bulk Terminal - Indonesia
- Power Finance Corporation Ltd., India
- Formosa Plastics Group - Taiwan
- Orica Mining Services - Indonesia
- The Treasury - Australian Government
- Timah Investasi Mineral - Indoneisa
- Orica Australia Pty. Ltd.
- Price Waterhouse Coopers - Russia
- Heidelberg Cement - Germany
- SMG Consultants - Indonesia
- Ministry of Mines - Canada
- Trasteel International SA, Italy
- PNOC Exploration Corporation - Philippines
- Indogreen Group - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Bukit Baiduri Energy - Indonesia
- Commonwealth Bank - Australia
- Leighton Contractors Pty Ltd - Australia
- Edison Trading Spa - Italy
- Essar Steel Hazira Ltd - India
- McConnell Dowell - Australia
- Indika Energy - Indonesia
- Energy Development Corp, Philippines
- Kartika Selabumi Mining - Indonesia
- Oldendorff Carriers - Singapore
- Kobexindo Tractors - Indoneisa
- Central Java Power - Indonesia
- Parliament of New Zealand
- Maharashtra Electricity Regulatory Commission - India
- San Jose City I Power Corp, Philippines
- Banpu Public Company Limited - Thailand
- Sree Jayajothi Cements Limited - India
- Global Green Power PLC Corporation, Philippines
- The State Trading Corporation of India Ltd
- Chettinad Cement Corporation Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Australian Commodity Traders Exchange
- Merrill Lynch Commodities Europe
- Ministry of Finance - Indonesia
- Indian Energy Exchange, India
- Chamber of Mines of South Africa
- Attock Cement Pakistan Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Maheswari Brothers Coal Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Goldman Sachs - Singapore
- VISA Power Limited - India
- Samtan Co., Ltd - South Korea
- Iligan Light & Power Inc, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Makarim & Taira - Indonesia
- Videocon Industries ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Sindya Power Generating Company Private Ltd
- Georgia Ports Authority, United States
- Vijayanagar Sugar Pvt Ltd - India
- Meralco Power Generation, Philippines
- Lanco Infratech Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Siam City Cement PLC, Thailand
- Economic Council, Georgia
- Kideco Jaya Agung - Indonesia
- Intertek Mineral Services - Indonesia
- Salva Resources Pvt Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Gujarat Sidhee Cement - India
- Kumho Petrochemical, South Korea
- Savvy Resources Ltd - HongKong
- AsiaOL BioFuels Corp., Philippines
- Neyveli Lignite Corporation Ltd, - India
- Kohat Cement Company Ltd. - Pakistan
- Marubeni Corporation - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Jaiprakash Power Ventures ltd
- MS Steel International - UAE
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tata Chemicals Ltd - India
- Electricity Generating Authority of Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bahari Cakrawala Sebuku - Indonesia
- India Bulls Power Limited - India
- CNBM International Corporation - China
- Tamil Nadu electricity Board
- TeaM Sual Corporation - Philippines
- Xindia Steels Limited - India
- Star Paper Mills Limited - India
- Bhatia International Limited - India
- Bharathi Cement Corporation - India
- Directorate General of MIneral and Coal - Indonesia
- Interocean Group of Companies - India
- Energy Link Ltd, New Zealand
- Vizag Seaport Private Limited - India
- Sarangani Energy Corporation, Philippines
- Australian Coal Association
- Mintek Dendrill Indonesia
- Coal and Oil Company - UAE
- PowerSource Philippines DevCo
- Petron Corporation, Philippines
- Cement Manufacturers Association - India
- Semirara Mining and Power Corporation, Philippines
- Eastern Coal Council - USA
- Siam City Cement - Thailand
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Borneo Indobara - Indonesia
- Malabar Cements Ltd - India
- Globalindo Alam Lestari - Indonesia
- Grasim Industreis Ltd - India
- Straits Asia Resources Limited - Singapore
- LBH Netherlands Bv - Netherlands
- Carbofer General Trading SA - India
- Riau Bara Harum - Indonesia
- Mercator Lines Limited - India
- Latin American Coal - Colombia
- Therma Luzon, Inc, Philippines
- CIMB Investment Bank - Malaysia
- SN Aboitiz Power Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Renaissance Capital - South Africa
- International Coal Ventures Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Ind-Barath Power Infra Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Wood Mackenzie - Singapore
- Sojitz Corporation - Japan
- ICICI Bank Limited - India
- Pendopo Energi Batubara - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Central Electricity Authority - India
- Asmin Koalindo Tuhup - Indonesia
- Independent Power Producers Association of India
- Aboitiz Power Corporation - Philippines
- South Luzon Thermal Energy Corporation
- Aditya Birla Group - India
- Coalindo Energy - Indonesia
- White Energy Company Limited
- Kaltim Prima Coal - Indonesia
- Indian Oil Corporation Limited
- Semirara Mining Corp, Philippines
- OPG Power Generation Pvt Ltd - India
- IEA Clean Coal Centre - UK
- GN Power Mariveles Coal Plant, Philippines
- Thiess Contractors Indonesia
- Parry Sugars Refinery, India
- Kalimantan Lumbung Energi - Indonesia
- Ministry of Transport, Egypt
- Krishnapatnam Port Company Ltd. - India
- Wilmar Investment Holdings
- Anglo American - United Kingdom
- Kepco SPC Power Corporation, Philippines
- Africa Commodities Group - South Africa
- Bulk Trading Sa - Switzerland
- Global Business Power Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Rashtriya Ispat Nigam Limited - India
- Thai Mozambique Logistica
- Sakthi Sugars Limited - India
- PTC India Limited - India
- ASAPP Information Group - India
- GAC Shipping (India) Pvt Ltd
- Dalmia Cement Bharat India
- Deloitte Consulting - India
- Bayan Resources Tbk. - Indonesia
- Bhoruka Overseas - Indonesia
- Coastal Gujarat Power Limited - India
- Standard Chartered Bank - UAE
- New Zealand Coal & Carbon
- Agrawal Coal Company - India
- Binh Thuan Hamico - Vietnam
- Bangladesh Power Developement Board
- Posco Energy - South Korea
- Larsen & Toubro Limited - India
- Port Waratah Coal Services - Australia
- Antam Resourcindo - Indonesia
- Barasentosa Lestari - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Bukit Makmur.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- SMC Global Power, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- IHS Mccloskey Coal Group - USA
- Sical Logistics Limited - India
- Sinarmas Energy and Mining - Indonesia
- Altura Mining Limited, Indonesia
- Madhucon Powers Ltd - India
- GVK Power & Infra Limited - India
- Baramulti Group, Indonesia
- Holcim Trading Pte Ltd - Singapore
- Eastern Energy - Thailand
- Mjunction Services Limited - India
- Simpson Spence & Young - Indonesia
- Medco Energi Mining Internasional
- Romanian Commodities Exchange
- Karaikal Port Pvt Ltd - India
- Bhushan Steel Limited - India
- GMR Energy Limited - India
- Singapore Mercantile Exchange
- Gujarat Mineral Development Corp Ltd - India
- Mercuria Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Electricity Authority, New Zealand
- Ambuja Cements Ltd - India
- Indo Tambangraya Megah - Indonesia
- Manunggal Multi Energi - Indonesia
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