Ballast Water Management Convention

Transcription

1 Ballast Water Management Convention BWMC s purpose is to minimize the transfer of harmful aquatic organisms, in order to protect the marine environment and human health: To prevent, minimize and ultimately eliminate the risks to the environment, human health, property and resources arising from the transfer of harmful aquatic organisms and pathogens. BWMC is essential for the preservation of the marine ecosystem.

2 Shipowners Risk Possibility that event will adversely impact achievement of mission or business objectives Preventable risks o Arising from within organization o Ought to be eliminated or avoided Strategy risks o Arising from a company voluntary acceptance o Generate superior returns from its strategy External risks o Beyond company control and often cannot be reduced or avoided o Can only be identified, assessed, and mitigated

3 Shipowners Risk Entry into force of the BWMC is approaching Companies have to be ready Risk of not integrating BWM measures soon enough Company stands to lose business/opportunities Companies must act Staying still is a risk

4 Shipowners Risk The Convention will enter into force twelve months AFTER THE DATE on which not less than 30 States, the combined merchant fleets of which constitute not less than 35 % of the gross tonnage of the world s merchant shipping, have either signed it without reservation as to ratification, acceptance or approval, or have deposited the requisite instrument of ratification, acceptance, approval or accession.

5 Risk Management Process of identifying, analysing and responding to risk factors Through a project s life and in the best interests of objectives Risk Management System to identify and quantify risks and predict the impact Evaluating whether a risk is acceptable or unacceptable

6 Cost-benefit Analysis Is installation economical? Can vessel be sold? Can IOPP be decoupled and renewed before deadline? Should vessel be scrapped? Pay upfront or finance? Can costs be recovered somehow?

7 Cost-benefit Analysis: Costs Capital expenditure (CAPEX) o Initial cost of system o Cost of additional components required for operation Operational expenditure (OPEX) o Annual cost of running system o Usually increases over time as system efficiency decreases Buffer (10%) o Any additional capital invested in system throughout service life o o Includes maintenance and repair, as well as component replacements or upgrades Lower CAPEX can lead to higher long-term costs

8 Cost-benefit Analysis: Benefits Income loss prevention o BWM does not bring an immediate commercial benefit o Ballast water treatment system can impact vessel revenue due to: Fines o System may not perform optimally in all conditions o Non-compliant ballast water exchange can result in fines Restricted port access

9 Commercial Issues Ship management agreement if there is one (manager s obligations) Preparing BWM plan and procuring approval by ship s flag state Providing training for crew in relation to BWM procedures Arranging for ships to be surveyed Obtaining BWM certificates required by convention

10 Commercial Issues Delays in the voyage being performed Issues with cargo to be loaded Time charter time spent for ballast water exchange Time charter sampling clause Reviewing newbuilding and sale and purchase portfolio

11 Commercial Issues Shipowners have duty to choose correct system and ensure system is accepted worldwide What happens if not? Sanctions for shipowners: o o Test to be repeated issue of costs and delays Sample found non-compliant identifying reason for failure and party against whom he will have a possible recourse Shipowners might have potential action against: o Manufacturer of equipment o Lab for wrong test or wrong interpretation

12 Commercial Issues Port state control inspections, checks and other enforcement procedures Track record of the ship in that port/area Nature of sanctions (fines/criminal charges) Uniformity of sanctions Insurance

13 Conclusion Installing/Selling the vessel/scrapping the vessel/renewing the IOPP Analysing costs (CAPEX + OPEX + BUFFER) Capacity to avoid income loss and decrease the risk of fines due to non-compliance Several commercial issues Monitoring potential extentions Be ready for the next chapter Global Sulphur Cap 2020 coming

14 Thank you! Fratelli D Amato Shipowners Carlo Corcione Legal Counsel and Director carlocorcione@fratellidamato.com