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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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Friday, 14 February 20
KOWEPO INVITED BIDS FOR 1.275 MILLION TONS OF MIN. 5,600 NCV COAL
COALspot.com: Korea Western Power Co. Ltd (KOWEPO). as a representative of five Korean Gencos has issued an international tender for total 1,275,00 ...
Friday, 14 February 20
IS THE US COAL INDUSTRY COMPLETELY BURNED OUT? -FORBES
This is the fourth of a multi-part series on the state of the main sources of energy in the US and how they compare globally. The series will cover ...
Friday, 14 February 20
FITCH RTGS: GLOBAL PORTS VULNERABLE TO CORONAVIRUS - RELATED VOLUME DECLINES
Global ports will see reduced trade volumes as a result of the coronavirus, COVID-19, which would become more severe should Chinese production take ...
Thursday, 13 February 20
INDIA: MAJOR PORTS SHOW MUTED GROWTH IN CARGO AS THERMAL COAL VOLUME SLIDES 15% - BUSINESS STANDARD
A sharp slide of 15 per cent in thermal coal volumes weighed on the performance of major ports during the period of April-January of FY20. The majo ...
Wednesday, 12 February 20
REFINING SET FOR A CHALLENGING 2020 - WOOD MACKENZIE
Downstream isn’t the glamorous end of the oil business. And in Big Oil, it’s typically dwarfed by upstream. Yet having been forced to r ...
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- Sakthi Sugars Limited - India
- Kaltim Prima Coal - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Eastern Coal Council - USA
- Posco Energy - South Korea
- Global Business Power Corporation, Philippines
- Eastern Energy - Thailand
- Rio Tinto Coal - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Meralco Power Generation, Philippines
- Agrawal Coal Company - India
- Jindal Steel & Power Ltd - India
- Standard Chartered Bank - UAE
- Riau Bara Harum - Indonesia
- Bukit Baiduri Energy - Indonesia
- CIMB Investment Bank - Malaysia
- White Energy Company Limited
- Mercuria Energy - Indonesia
- Malabar Cements Ltd - India
- Kapuas Tunggal Persada - Indonesia
- PNOC Exploration Corporation - Philippines
- Economic Council, Georgia
- Gujarat Sidhee Cement - India
- New Zealand Coal & Carbon
- Edison Trading Spa - Italy
- Kepco SPC Power Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- SN Aboitiz Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Asmin Koalindo Tuhup - Indonesia
- Bhushan Steel Limited - India
- Bhatia International Limited - India
- Chettinad Cement Corporation Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Trasteel International SA, Italy
- Grasim Industreis Ltd - India
- Latin American Coal - Colombia
- Energy Link Ltd, New Zealand
- Merrill Lynch Commodities Europe
- Samtan Co., Ltd - South Korea
- Wood Mackenzie - Singapore
- International Coal Ventures Pvt Ltd - India
- Aditya Birla Group - India
- Timah Investasi Mineral - Indoneisa
- Metalloyd Limited - United Kingdom
- PetroVietnam Power Coal Import and Supply Company
- Lanco Infratech Ltd - India
- Central Java Power - Indonesia
- Xindia Steels Limited - India
- Larsen & Toubro Limited - India
- Global Coal Blending Company Limited - Australia
- South Luzon Thermal Energy Corporation
- Iligan Light & Power Inc, Philippines
- Independent Power Producers Association of India
- Anglo American - United Kingdom
- Billiton Holdings Pty Ltd - Australia
- Medco Energi Mining Internasional
- Sinarmas Energy and Mining - Indonesia
- Ambuja Cements Ltd - India
- Electricity Generating Authority of Thailand
- Singapore Mercantile Exchange
- Makarim & Taira - Indonesia
- Price Waterhouse Coopers - Russia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Maharashtra Electricity Regulatory Commission - India
- Kideco Jaya Agung - Indonesia
- Bhoruka Overseas - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Africa Commodities Group - South Africa
- Thiess Contractors Indonesia
- The Treasury - Australian Government
- Kobexindo Tractors - Indoneisa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Cement Manufacturers Association - India
- Bahari Cakrawala Sebuku - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Planning Commission, India
- Vedanta Resources Plc - India
- TeaM Sual Corporation - Philippines
- Energy Development Corp, Philippines
- Georgia Ports Authority, United States
- Australian Commodity Traders Exchange
- Orica Australia Pty. Ltd.
- Coal and Oil Company - UAE
- Ministry of Transport, Egypt
- Sarangani Energy Corporation, Philippines
- India Bulls Power Limited - India
- Savvy Resources Ltd - HongKong
- Karbindo Abesyapradhi - Indoneisa
- Parliament of New Zealand
- Mintek Dendrill Indonesia
- Essar Steel Hazira Ltd - India
- CNBM International Corporation - China
- Simpson Spence & Young - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tata Chemicals Ltd - India
- Tamil Nadu electricity Board
- The State Trading Corporation of India Ltd
- Coalindo Energy - Indonesia
- Bharathi Cement Corporation - India
- LBH Netherlands Bv - Netherlands
- London Commodity Brokers - England
- ASAPP Information Group - India
- Borneo Indobara - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Port Waratah Coal Services - Australia
- GN Power Mariveles Coal Plant, Philippines
- European Bulk Services B.V. - Netherlands
- Kartika Selabumi Mining - Indonesia
- Goldman Sachs - Singapore
- Globalindo Alam Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Pendopo Energi Batubara - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Sical Logistics Limited - India
- Karaikal Port Pvt Ltd - India
- McConnell Dowell - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Bukit Makmur.PT - Indonesia
- Siam City Cement PLC, Thailand
- Attock Cement Pakistan Limited
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Altura Mining Limited, Indonesia
- Antam Resourcindo - Indonesia
- SMC Global Power, Philippines
- Marubeni Corporation - India
- Power Finance Corporation Ltd., India
- Global Green Power PLC Corporation, Philippines
- MS Steel International - UAE
- Vijayanagar Sugar Pvt Ltd - India
- Videocon Industries ltd - India
- Indian Oil Corporation Limited
- Central Electricity Authority - India
- SMG Consultants - Indonesia
- PowerSource Philippines DevCo
- Mjunction Services Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Salva Resources Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Minerals Council of Australia
- Jorong Barutama Greston.PT - Indonesia
- GVK Power & Infra Limited - India
- Romanian Commodities Exchange
- ICICI Bank Limited - India
- Straits Asia Resources Limited - Singapore
- Meenaskhi Energy Private Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Directorate General of MIneral and Coal - Indonesia
- Orica Mining Services - Indonesia
- Therma Luzon, Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Sindya Power Generating Company Private Ltd
- Barasentosa Lestari - Indonesia
- Directorate Of Revenue Intelligence - India
- Gujarat Electricity Regulatory Commission - India
- Semirara Mining Corp, Philippines
- AsiaOL BioFuels Corp., Philippines
- Uttam Galva Steels Limited - India
- Interocean Group of Companies - India
- GMR Energy Limited - India
- Petron Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Jaiprakash Power Ventures ltd
- Siam City Cement - Thailand
- The University of Queensland
- Renaissance Capital - South Africa
- Mercator Lines Limited - India
- Indian Energy Exchange, India
- Carbofer General Trading SA - India
- Sojitz Corporation - Japan
- Kumho Petrochemical, South Korea
- Leighton Contractors Pty Ltd - Australia
- Ceylon Electricity Board - Sri Lanka
- Intertek Mineral Services - Indonesia
- Coastal Gujarat Power Limited - India
- Bulk Trading Sa - Switzerland
- Manunggal Multi Energi - Indonesia
- Sree Jayajothi Cements Limited - India
- Rashtriya Ispat Nigam Limited - India
- Dalmia Cement Bharat India
- Binh Thuan Hamico - Vietnam
- Oldendorff Carriers - Singapore
- Toyota Tsusho Corporation, Japan
- Alfred C Toepfer International GmbH - Germany
- Baramulti Group, Indonesia
- Aboitiz Power Corporation - Philippines
- Chamber of Mines of South Africa
- Commonwealth Bank - Australia
- Semirara Mining and Power Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Electricity Authority, New Zealand
- San Jose City I Power Corp, Philippines
- Ind-Barath Power Infra Limited - India
- Vizag Seaport Private Limited - India
- Bayan Resources Tbk. - Indonesia
- Australian Coal Association
- Ministry of Mines - Canada
- Deloitte Consulting - India
- Thai Mozambique Logistica
- Indogreen Group - Indonesia
- Ministry of Finance - Indonesia
- Wilmar Investment Holdings
- VISA Power Limited - India
- Indo Tambangraya Megah - Indonesia
- Parry Sugars Refinery, India
- Bangladesh Power Developement Board
- Formosa Plastics Group - Taiwan
- PTC India Limited - India
- Star Paper Mills Limited - India
- Indonesian Coal Mining Association
- Indika Energy - Indonesia
- Heidelberg Cement - Germany
- IEA Clean Coal Centre - UK
- OPG Power Generation Pvt Ltd - India
- Madhucon Powers Ltd - India
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