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SINGAPORE SHIPPING ASSOCIATION . U.S. Maritime Regulatory Update 2009 Jonathan K. Waldron June 17, 2009. OVERVIEW. The Environmental Protection Agency’s (“EPA”) New Vessel General Permit Regime Compliance and enforcement Avoiding Criminal Liability Latest cases Lessons learned
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SINGAPORE SHIPPING ASSOCIATION U.S. Maritime Regulatory Update 2009Jonathan K. WaldronJune 17, 2009
OVERVIEW • The Environmental Protection Agency’s (“EPA”) New Vessel General Permit Regime • Compliance and enforcement • Avoiding Criminal Liability • Latest cases • Lessons learned • What you should know about preparing for a marine casualty to avoid criminal liability • The Need for Acceptable Credentials for U.S. Access and the Need for Foreign Nationals to Obtain a Transportation Worker Identification Credential (“TWIC”) • Acceptable Credentials • Should your personnel obtain a TWIC • What type of visa is required in order to obtain a TWIC
OVERVIEW(continued…) • Implementation of MARPOL Annex VI and California Developments • Emission Control Areas • New California Fuel Requirements • Port State Control • Latest port state control assessment for security and safety • Flag states that have been targeted for 2009 • Qualship 21
DISCHARGES INCIDENTAL TO THE NORMAL OPERATION OF A VESSEL • 1972 – Clean Water Act established the National Pollutant Discharge Elimination System (“NPDES”) • Discharges of pollutants from “point sources” generally require a permit • Vessels within three miles of the coastline are point sources • THUS – vessels need permits • BUT…EPA regulatory exemption: “any discharge of sewage from vessels, effluent from properly functioning marine engines, laundry, shower, and galley sink wastes, or any other discharge incidental to the normal operation of a vessel...” • No challenges to this exclusion until 1999
LEGAL CHALLENGE / EPA RULEMAKING HISTORY • Rulemaking Petition: In 2003, EPA denied environmental groups’ 1999 request to repeal the exclusion • Lawsuit: Northwest Environmental Advocates sued in federal court in northern California • March 2005 – District Court ruled that EPA exceeded its authority • EPA appealed • Appeal denied in 2008 • Exemption invalid as of September 2008 (then December 19, 2008 and then February 6, 2009)
VESSEL GENERAL PERMITSOURCES OF INFORMATION / GUIDANCE • Final Vessel General Permit (“VGP”) • Issued December 18, 2008 • Modified February 5, 2009 • VGP Fact Sheet (Dec 18, 2008) • Response to Public Comments (1273 pages) • Compliance required February 6, 2009
VESSEL GENERAL PERMIT WHAT DO YOU NEED TO KNOW?
VGP EFFLUENT LIMITS • Limits in General Must minimize discharges, which means reduce and/or eliminate to the extent achievable using control measures (including best management practices) that are technologically available and economically practicable and achievable in light of best marine practice (1) Technology-Based Effluent Limits – All Vessels • Material Storage – minimize onboard materials that might wash overboard or dissolve as a result of contact with surface water spray or that may blow overboard • Toxic and Hazardous Materials – locate them in protected areas of the vessel unless interferes with safety or essential operations; use appropriate containers, labeled and secured • Fuel Spills/Overflows – procedures to minimize spills and for prompt containment and cleanup; requirements also for fueling lifeboats, tenders, and rescue boats – crew training requirements • Discharges of Oil, Including Oily Mixtures – MARPOL Annex I • Compliance with Other Legal Requirements
Deck Washdown and Runoff and Above Water Line Hull Cleaning Bilgewater Ballast Water Anti-Fouling Hull Coatings Aqueous Film Forming Foam Boiler/Economizer Blowdown Cathodic Protection Chain Locker Effluent Controllable Pitch Propeller and Thruster Hydraulic Fluid and Other Oil to Sea Interfaces; Rudder Bearing Lubrication; Stern Tube Oily Discharge Distillation and Reverse Osmosis Brine Elevator Pit Effluent Firemain Systems Freshwater Layup Gas Turbine Wash Water Graywater Motor Gasoline and Compensating Discharge Non-Oily Machinery Wastewater Refrigeration and Air Condensate Seawater Cooling Overboard Discharge Seawater Piping Biofouling Prevention Boat Engine Wet Exhaust Sonar Dome Discharge Underwater Ship Husbandry Welldeck Discharges Graywater Mixed with Sewage Exhaust Gas Scrubber Wash Water Discharge VGP EFFLUENT LIMITS(continued…) (2) Technology-Based – Specific Discharge Types
VGP EFFLUENT LIMITS (continued…) • Best Management Practices (“BMP”) – Example: Deck Washdown Run-off and Above Water Line Hull Cleaning • Minimize on-deck debris, garbage, etc. • Where feasible, machinery must have coamings or drip pans, which are regularly drained and cleaned • Visible solids, foam, etc. must be minimized; also washdowns in port • Must maintain topside to minimize the discharge of rust, paint chips, non-skid material fragments, etc. • Minimize paint droplets into water by avoiding painting in windy conditions • Non-toxic and phosphate free cleaners and detergents that are minimally caustic and biodegradable must be used
STATE 401 CERTIFICATIONS • EPA may not issue a permit authorizing discharges into state waters until that state has granted or waived certification under Section 401 of the Clean Water Act • A state has the opportunity to include more stringent conditions than in the federal permit as part of its certification • Many states have done so… California example for “In-water” hull cleaning using “best available technologies economically feasible” • And with much controversy, that resulted in many state conditions being withdrawn -- or they would have shut down shipping operations
NOTICE OF INTENT • Obtaining Coverage –Vessels ≥ 300 GT must submit an NOI to be covered between June 19 and September 19, 2009 • IF NOT, YOU ARE NOT COVERED BY THE PERMIT AND ARE OPERATING ILLEGALLY • Automatically covered until September 19, 2009 • After September 19, 2009, there is a 30-day waiting period • Certifying Official
SELF INSPECTIONS • Routine Visual Inspections • Weekly / Voyage– whichever more frequent (or once per day) • Ensure areas of vessel are clear of garbage, exposed materials, oil, and other pollutants to ensure pollution prevention mechanisms in proper working order; area around vessel; verify training, inspections, and recordkeeping • Quarterly– same as above, along with samples of discharge streams not readily visually inspected, i.e., those discharges below the waterline, including bilge water • Annual Inspections • More comprehensive – at least every 12 months and by “qualified” personnel (master, owner/operator, marine/environmental engineers or techs, class society – all if appropriately trained) • All areas of vessel covered by VGP, including hull, ballast tanks, bilges, protective seals, chain lockers, and oil/chemical and waste storage areas • Review of monitoring data and routine maintenance records Coast Guard/Class inspections can be used to meet some requirements • Drydock inspections –prepared by class or flag and must include five key areas defined in VGP
CORRECTIVE ACTIONS • Triggers • Any violation of VGP regardless of how identified • If your measures do not adequately control discharges • If your pollution control measures or BMPs are not properly operated or maintained However discovered! • Corrective Action Assessment • Nature, cause, and options for eliminating the problem • Description, including date, time, location, impacts and name, title, signature, of person recording • Explanation, corrective action plan, and follow on documentation • Maintain documentation that is signed and certified • Timing • As soon as possible, but no later than two weeks • Three months after discovery if new parts/installations required • Immediately following drydock if drydocking required
RECORDKEEPING • Recordkeeping (asof Feb 19, 2009) • Owner / Vessel Information Certifying Official’s Name • Voyage Log • Documentation of all violations • Logging of inspections, deficiencies, and problems • Logging of: • significant deck maintenance • application of anti-fouling paint • AFFF discharges • chain locker inspections • propeller/stern tube/oil-sea interface maintenance • emergencies requiring discharges • Gas Turbine Water Wash discharge/disposal
REPORTING • Reporting (as of Feb 19, 2009) • Non-compliances at least once per year to EPA Region • One-Time Permit Report (between 30-36 months) • RQ Reporting – Not VGP requirement, but reports to NRC must be made • Within 14 days a detailed log required for VGP records • Releases that “may endanger health or the environment” • 24-hour oral report to EPA Region • 5-day follow-up written report • Per “standard permit terms” in 40 C.F.R. § 122.41
TIMING – INSPECTIONS/CORRECTIVE ACTIONS • If a vessel regularly leaves VGP waters: • Inspections must be done prior to the vessel returning to US waters • Most recent weekly/voyage, quarterly, annual, and drydock • Corrective actions must be corrected within the designated timeframe or prior to returning to US waters
ENFORCEMENT / PENALTIES Enforcement • EPA will enforce the VGP – discussions ongoing with Coast Guard • “EPA will focus its efforts on compliance assistance and developing a workable enforcement strategy with the Coast Guard and other federal and state agencies” • States not likely to enforce for EPA, but can develop own VGP program with approval from EPA • Citizen lawsuits Penalties • Administrative/Civil – up to $37,500 per day for each day of violation • Injunctive – can prevent vessel from operating or require a corrective action • Criminal – including fines and imprisonment • Separate penalties under the Clean Water Act / VGP/ False Statements (certifications)
CHALLENGES • Reading / comprehending the more than 1,500 pages of information • Putting your program and procedures in place • Training your crew • Applicability of Permit Requirements Seaward of the Three-Mile Limit? • Documentation / Recordkeeping / Violations • State Requirements / Prohibitions • Enforcement
CRIMINAL ENFORCEMENT UPDATE How did we get here? Where are we going?
BRIEF HISTORY • Department of Justice’s Vessel Pollution Initiative • Mid-1990s, U.S. began focusing enforcement efforts on the maritime industry • At the outset, largely focused on garbage discharges from cruise ships • Evolved into oil-water separator cases, oil spills, and other pollution events • Trend continued, and in recent years individuals, as well as companies, have become targets • Does not discriminate by vessel flag or type, or by the nationality of the crewmembers
KEY ENVIRONMENTAL LEGISLATION AND THEORIES OF LIABILITY • Federal Law • Act to Prevent Pollution from Ships (“APPS”) • Clean Water Act (“CWA”) / VGP • Oil Pollution Act of 90 (“OPA 90”) • Resource Conservation and Recovery Act (“RCRA”) • Ocean Dumping Act • Refuse Act / Migratory Bird Treaty Act • State Law • False Statements, Obstruction of Justice, Conspiracy
“FALSE STATEMENTS” - WHAT’S THE CRIME? • 18 U.S.C. § 1001: “[W]hoever, in any matter within the jurisdiction of the executive, legislative, or judicial branch of the Government of the United States, knowingly and willfully: (1) falsifies, conceals, or covers up…a material fact; (2) makes any materially false, fictitious, or fraudulent statement or representation; or (3) makes or uses any false writing or document knowing the same to contain any materially false, fictitious, or fraudulent statement or entry; shall be fined under this title or imprisoned not more than 5 years, or both…” • Interviews, documents, meetings, log books, general conversation
2008 PROSECUTIONS • B. Navi Ship Management– In February in Texas, pled guilty and paid a $1.5 million fine in connection with the illegal discharge of oily sludge, bilge wastes, and oil-contaminated ballast water from the M/V Windsor Castle. Six whistleblowing crewmembers awarded between $43,000 and $85,000 each • Pacific Gulf Marine – In February in Maryland, 5th former chief engineer pled guilty to conspiracy and false statements. In January in Maryland, 4th chief sentenced to six months in prison • Cosco Busan– In March/April in California, the ship’s mandatory state pilot was charged with violating the CWA and MBTA, and two false statements after the vessel’s allision with the San Francisco‑Oakland Bay Bridge in November 2007 • PACCSHIP– In April in North Carolina, the company, which operated and managed ten ships transporting goods between Asia and the US, pled guilty and paid $1.7 million for crimes related to improper transfers and discharges of oil-contaminated waste from two of its ships • Kinder Morgan– In April in Louisiana, Kinder Morgan Bulk Terminals, Inc. pled guilty to one violation of the Ocean Dumping Act and will pay a penalty of $240,000 related to the bulk cargo vessel, J/A Aladdin Dream II. KMBT received an off-specification load of potash at its terminal in 2003 and contracted with the vessel master to store the off-spec potash on deck and then dispose of it at sea • National Navigation Company– In May in Oregon, company pled guilty to 15 felony charges for violating APPS and making false statements and paid $7.25 million penalty • Reederei Karl Schlueter GmbH & Co. KG– In June in Pennsylvania, RKS pled guilty and will pay $1.2 million penalty, three years’ probation, and an environmental compliance plan (“ECP”) for falsifying the Oil Record Book (“ORB”) on the MSC URUGUAY. Chief engineer also convicted
2008 PROSECUTIONS (continued…) • Clipper Marine Services A/S– In June in New Jersey, Clipper pled guilty and paid a $4.75 million fine, three years’ probation, and an ECP in connection with illegal discharges of oily waste from the CLIPPER TROJAN. Agreed to retrofit certain ships with state-of-the-art oily water separators and acknowledged that the discharges were in part due to “its failure to manage the vessel so as to ensure compliance with MARPOL and U.S. laws and regulations, and its failure to diligently enforce company policies prohibiting such conduct.” Chief engineer also convicted • Casilda Shipping, Ltd.– In October in California, the owner, operator and chief engineer pled guilty to falsifying records on the Rio Gold. Casilda Shipping was fined $750,000 and will serve three years’ probation, Genesis Seatrading Corporation was sentenced to three years’ probation and must implement an extensive ECP, and the chief engineer was sentenced to three years’ probation and fined $5,000 in connection with alleged illegal discharges of oil and garbage • Marine Waste Services– In July in Texas, pled guilty, paid a $10,000 fine, and sentenced to 2-years’ probation for improperly handling regulated garbage from ships • Fairport Shipping Ltd.– In July in Alaska, pled guilty to one felony count and will pay a fine of $250,000, with $150,000 suspended, and two-years’ probation for illegally discharge oily waste in 2003 • U.S. Coast Guard– In August in Hawaii, the chief warrant officer on the Coast Guard Cutter Rush was sentenced to pay a $5,000 fine, serve 200 hours community service, and serve two years’ probation for making a false statement regarding the discharge of bilge wastes by bypassing the oily water separator in 2006
2008 PROSECUTIONS (continued…) • M/V Nautilus– In September in Massachusetts, a chief engineer pled guilty to two violations of the APPS for failing to maintain an accurate ORB. Another seafarer was indicted on one count of violating APPS and one count of lying to the Coast Guard in connection with allegations of improperly maintaining the ORB • STX Pan Ocean Co. Ltd.– In October in Washington, pled guilty for falsifying its Garbage Record Book for discharging drums, sacks, and bags of oil-contaminated rice and paid a $750,000 penalty. Two senior officers also pled guilty for failing to notify the Coast Guard of the false document. Two whistleblowing crewmembers were awarded $125,000 each • Hiong Guan Navegacion Japan Co. Ltd.– In November in Florida, operators pled guilty to conspiracy and falsifying the ORB onboard the Balsa 62 and agreed to pay $1.75 million. Two chief engineers also pled guilty • General Maritime Management– In November in Texas, the ship operator, chief engineer, and first engineer were convicted by a jury of making false statements and falsifying the ORB on the M/T Genmar Defiance. The jury found that the engineers “tricked” the oily water separator by putting fresh water through the oil content meter. Two crewmembers photographed this operation and provided the information to the Coast Guard during a routine boarding. Genmar has announced that it intends to appeal • ExxonMobil Pipeline– In December in Massachusetts, ExxonMobil Pipeline pled guilty to a negligent violation of the Clean Water Act and will pay a $6.1 million penalty in connection with an oil spill from a product receipt line that ruptured while offloading a tanker. The company will also have its terminal monitored by a court-appointed observer overseeing an ECP
2009 PROSECUTIONS • Pendulum Shipmanagement– In January, Pendulum, a Greek ship manager, pled guilty to conspiring with crewmembers of the M/V Quantum to falsify the ORB. Company also falsified Ballast Water Reporting forms and obstructed a USCG Port State Control inspection. Sentenced to a fine of $1.3 million, three years of probation, and ordered to implement an ECP • Dalnave Navigation Inc.–In February in New Jersey, the Liberian company and the Chief and Second Engineers on the M/V Myron N were charged with conspiracy and APPS violations for allegedly failing to maintain an accurate ship record concerning the disposal of oil-contaminated waste, making false statements and obstruction of justice. Company faces up to $500,000 in fines on each of the eight counts and the two engineers each face up to nine years in prison and fines of $250,000 per count • M/T Nautilus–In March in Washington, the Chief Engineer on the M/T Nautilus, a Cyprus-flagged chemical tanker, pled guilty to using falsified records to conceal improper discharges of oil-contaminated bilge water. In May he was sentenced to one month imprisonment to be followed by two years of supervised release and a $3,000 fine. In April in Boston, Consultores De Navegacion, the Spanish company that operates the M/T Nautilus, pleaded guilty to conspiracy, falsification of records, false statements, obstruction of justice, and two APPS violations for failing to maintain an accurate ORB. The company has agreed to pay a $2.5 million fine, will serve three years of probation, and implement a ECP to ensure there are no future violations • Holy House Shipping AB– In March in New Jersey, company was sentenced to pay a $1.4 million penalty and ordered to serve three years’ probation for failing to maintain an accurate ORB. Coast Guard inspectors found evidence and received information regarding use of a magic pipe on the M/V Snow Flower. Two whistleblowers were awarded $375,000. Chief engineer had already pled guilty to failing to maintain an accurate ORB and was fined $8,000
2009 PROSECUTIONS (continued…) • Cosco Busan– In March in California, the pilot of the M/V Cosco Busan pled guilty to negligently discharging 53,000 gallons of oil and violations of the MBTA, a charge of a false statement regarding failing to disclose medications in his license renewal forms will be tried separately. The pilot faces between two and ten months imprisonment, a $3,000 to $30,000 fine, and has agreed to serve the maximum one year of supervised release during which he will not serve as a ship pilot or captain • General Maritime–In March in Texas the company was sentenced to $1 million in fines (false statements and failure to maintain accurate ORB) and five years probation. The chief engineer and first engineer of the M/T Genmar Defiance, which is operated by General Maritime, were previously convicted by a jury for the same violations in November 2008 and were sentenced in February 2009. The chief engineer was sentenced to three months of confinement in a half-way house, a $500 fine, $200 special assessment and five years of probation. The first engineer was sentenced to six months of confinement in a half-way house, a $500 fine, $200 special assessment, and five years of probation. Five whistleblowers were awarded a total of $250,000 • STX Pan Ocean Co. Ltd. – In June the Korean company was sentenced to conspiracy and falsifying and failing to properly maintain an accurate ORB on board the M/V Ocean Jade. The chief engineer also pleaded guilty to failing to maintain the ship’s ORB and making false statements. The company received four years of probation for each of the four counts against it and was sentenced to pay $2.2 million in fines and implement a detailed ECP. The chief officer and chief engineer plead guilty to the falsification of the oil and garbage record books. The chief officer was sentenced to time served and three years’ probation and the chief engineer was sentenced to three years of probation and a $1,500 fine
RECENT TRENDS – ACCORDING TO DOJ • Continued non-compliance • Increased international enforcement and cooperation • Increased whistleblower awards under APPS – 50% of DOJ prosecutions arise from whistleblower reports • “In the discretion of the Court, an amount equal to not more than 1/2 of such fine may be paid to the person giving information leading to a conviction” • Continued lying and obstruction of justice • Continued falsification of the Oil Record Book / Garbage Record Book • Increased criminal penalties • Corporations blaming their employees • Crewmembers blaming their employers
WHERE ARE WE GOING? • Coast Guard Voluntary Disclosure Policy for Environmental Crimes • If conditions set forth in a Compliance Management System (“CMS”) are met and a newly detected violation is voluntarily reported • Then the Coast Guard can exercise its enforcement discretion and not refer the case to DOJ for prosecution
WHERE ARE WE GOING? (continued…) • Voluntary Disclosure Policy Factors • Voluntary Discovery • Prompt Disclosure within 21 Days • Independent Discovery and Disclosure must be completed before Government Investigation Commences or Whistleblower Report • Correction and Remediation within 60 days • Take Steps to Prevent Re-Occurrence • No Pattern of Violations (one vessel three years/multiple vessels five years) • Certain Serious Violations Excluded • Full Cooperation
WHERE ARE WE GOING? (continued…) • CMS Elements • Policies and Standards • Assignment of Responsibilities • System of Monitoring and Auditing to Detect Violations • Report without Fear of Retaliation • Corrective Action Taken in a Timely Manner • Periodic Evaluation of the CMS
PREPARING FOR A MARINE CASUALTY IN U.S. WATERS • Prepare Guidance for Onslaught of Investigators • Intimidating Situation and Importance of not Speaking to Investigators or Telling the Truth • First 24 Hours are Critical • Train Crew and Senior Managers on their Rights and to Make Strategic Decisions • Key Decisions Relating to Selection of Counsel to Represent the Company, the P & I Club, and Individuals • Preservation of Hard and Electronic Information • Proper Functioning and Use of Navigation Equipment (e.g. collision avoidance systems, ECDIS, AIS) and using “All Available Means” to assist in navigation • Review National Transportation Safety Board’s report on the Cosco Busan
ACCEPTABLE MARINER CREDENTIALS AND SEAFARER ACCESS • The Best Jobs • Mathematician • Actuary • Statistician • Biologist • Software Engineer • The Worst Jobs 194. Garbage Collector • Roofer • Emergency Medical Technician • Seaman • Taxi Driver • Dairy Farmer • Lumberjack
SEAFARERS’ ACCESS • SHORE LEAVE DENIALS AND CREW DETENTIONS • Lack of Visa – 76% • Terminal Restrictions – 16% • Vessel Restrictions – 6% • Agent Issues – 2% • SHORE LEAVE UNDER THE ISPS CODE • (MSC/Circ. 1112 (June 7, 2004)) • Section A /16.3.15 provides that a port facility security plan (PFSP) must contain procedures for facilitating shore leave, crew charges and access for visitors including representatives of seafarers’ welfare and labour organizations • Each facility owner or operator must: “ensure coordination of shore leave for vessel personnel or crew change out, as well as access through the facility for visitors to the vessel (including representatives of seafarers’ welfare and labor organizations), with vessel operators in advance of a vessel’s arrival”
SEAFARERS’ ACCESS (continued…) • Facility Security Plan (FSP) under U.S. Law (33 C.F.R. § 105.200(b)(9)): same “coordination” provision as under MSC/Circ. 1112 • October 2008 - ALCOAST 529/08 COMDTNOTE 16611 • COTPs should encourage, support, and facilitate vigorously any accommodations at regulated facilities to make shore leave and access to seafarers welfare organizations possible
ACCEPTABLE CREDENTIALS • ACCEPTABLE CREDENTIALS • Coast Guard issued final rule on April 28, 2009 and was effective on May 28, 2009 • The following credentials are required and acceptable for shore access: • Passport; • U.S. Permanent Resident Card; • U.S. Merchant Mariner’s Document; • TWIC; or • Seafarer’s Identification Document (“SID”) issued by or under the authority of the government of a country that has ratified the International Labour Organization Seafarers’ Identity Documents Convention (Revised), 2003 (“ILO 185”). • Penalties: $25,000 to $50,000 civil penalty could be assessed against the individual or the owner/operator
DO YOUR EMPLOYEES NEED A TWIC? The Maritime Transportation Security Act of 2002 (“MTSA”) required: Certain vessels and facilities to have security plans Issuance of TWIC Licensed Mariners Individualsrequiring unescorted access to “secure areas” of MTSA-regulated facilities and vessels facility employees truck drivers contractors train crews maintenance personnel longshoremen port superintendents
Required for unescorted access to MTSA facilities and vessels Does not apply to foreign vessels… However, it does apply to foreign crewmembers transiting an MTSA facility Visa Categories B1/OCS – Business/OCS C-1/D – Crewman H-1B – Special Occupations H-1B1 – Free Trade Agreement E-1 – Treaty Trader E-2 – Bilateral Investment, Commerce & Navigation Treaty E-3 – Australian in Specialty Occupation L-1 – Intracompany Executive Transfer O-1 – Extraordinary Ability TN – North American Free Trade Agreement “Catch all” for visas similar to those listed BUT… TWIC ELIGIBILITY FOR FOREIGN NATIONALS
WHAT SHOULD YOU BE DOING? National Compliance Deadline went into effect on May 15, 2009 Make sure you determine which of your employees need a TWIC and confirm they have one Non-citizen / visa issues Determine what contractors and other non-employees may utilize your facility or vessels that need access to secure areas – truck drivers, surveyors, port superintendents, insurers, entertainers Who, when, where–plan ahead, e.g., maintenance/construction
MARPOL ANNEX VI IMPLEMENTATION • U.S. became party to MARPOL Annex VI on October 8, 2008 • Entered into force in the U.S. on January 8, 2009 • Development of Joint Emission Control Area (“ECA”) with Canada • Over 40 port cities in U.S. are in EPA non-attainment areas • Canada and U.S. proposed an ECA in most coastal waters of both countries on March 30, 2009 • Proposal Timing – MEPC 59 will review in July 2009 • Approval Timing – Anticipate approval at MEPC 60 July 2010 with expectation to enter into force August 2012 • ECA Standards: (1) Now: 15,000 PPM (2) July 2010: 10,000 PPM (3) January 2015: 1,000 PPM (4) 2016: new engines must reduce NOx by 80%
MARPOL ANNEX VI IMPLEMENTATION(continued…) • California Air Resources Board (“CARB”) Proposal • CARB issued proposal on February 18, 2009 applicable to ocean-going vessels within 24 miles of coastline Fuel Requirements for Ocean-going Vessel Main (Propulsion) Diesel Engines,Auxiliary Diesel Engines, and Auxiliary Boilers • Sunset Provision in case EPA adopts national air emission standards at least as effective as the CARB requirements • Expect this proposal to become final
PORT STATE CONTROL • Security trend in last few years - down 36% • Safety trend in last few years – up 17% (1.6% detentions in 2007 and 1.76% in 2008) • 2009 Evaluation of Flag Administration Performance (Security) • Average Control Action Ratio for all Flag Administrations 1.5% • two points added if over 1.5% and seven points added if over 3% • Upcoming Year: Saint Vincent and the Grenadines (1.54%) • Flag Administrations removed ** Flag Administration removed because they were subject to only one major control action in the previous three years.
PORT STATE CONTROL(continued…) • 2009 Evaluation of Flag Administration Performance (Safety) • Flag Administrations with Safety Detention Ratio higher than the overall average and associated with more than one detention in last three years and to be assigned seven points for the Targeting Priority Matrix beginning on May 1, 2009
PORT STATE CONTROL(continued…) • 2009 Evaluation of Flag Administration Performance (Safety) • Flag Administrations to be assigned two points in the Targeting Priority Matrix beginning May 1, 2009 * Countries that were not on the list last year. ** Counties that were not on the seven point list last year.
PORT STATE CONTROL(continued…) • 2009 Evaluation of Flag Administration Performance (Safety) • Flag Administrations removed from the Targeting Priority Matrix • Quality for Shipping for the 21st Century (Qualship 21) • Less than 10% of all foreign-flag ships have earned Qualship 21 designation • Criteria: 10 ship arrivals a year and a three-year detention average of 1% or less.
PORT STATE CONTROL(continued…) • Qualship 21 Designation effective May 1, 2009 * Flag Administrations that were not on the list last year.
PORT STATE CONTROL(continued…) • Flag Administrations removed from Qualship 21 * Flag Administrations removed due to less than 10 individual vessel arrivals in 2008.
QUESTIONS?Jonathan K. WaldronBlank Rome LLPThe Watergate600 New Hampshire Avenue, N.W.Washington, D.C. 20037Tel. (202) 772-5964Mob. (703) 407-6349waldron@blankrome.comBlank Rome5605-07, The Center99 Queen’s Road Central, Hong KongTel. (852) 3528-8300Fax (852) 3528-8383nbinnersley@blankrome.com