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Friday, 05 June 20
U.S. SANCTIONS COMPLIANCE GUIDANCE RELEASED FOR THE GLOBAL MARITIME, ENERGY AND METALS SECTORS - AKIN GUMP
 Key Points
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On May 14, 2020, OFAC, the Department of State and the U.S. Coast Guard jointly released guidance for persons involved in the maritime industry regarding common deceptive shipping practices used to subvert U.S. and United Nations sanctions programs targeting Iran, North Korea and Syria.
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The guidance highlights certain deceptive practices employed in maritime activity that could signal sanctions evasion.
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The guidance also contains specific measures that the maritime industry and energy and metals sectors can take to tailor their sanctions compliance programs to avoid sanctions violations or otherwise supporting illicit shipping activities.
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This Guidance is part of a sustained focus on the international shipping industry, including the U.S. Government’s latest enforcement actions in the shipping sector on June 2, 2020.
The Guidance
On May 14, 2020, the Department of the Treasury’s Office of Foreign Assets Control (OFAC), the Department of State and the U.S. Coast Guard jointly released guidance (the “Guidance”) regarding common deceptive shipping practices in order to aid persons involved in the maritime industry, and energy and metals sectors, in tailoring their due diligence and sanctions compliance policies and procedures. The Guidance is particularly targeted towards ship owners, managers, operators, brokers, ship chandlers, flag registries, port operators, shipping companies, freight forwarders, classification service providers, commodity traders, insurance companies and financial institutions. The shipping industry continues to present particularly challenging issues associated with U.S. sanctions compliance, including the involvement of numerous parties in particular voyages all with different, yet overlapping risks.
The Guidance continues a further and concerted effort by OFAC to focus in particular on the shipping industry and builds on prior advisories that it has issued directed at the shipping industry, including one issued on September 4, 2019, entitled “Sanctions Risks Related to Shipping Petroleum and Petroleum Products from Iran” that also identified specific deceptive shipping practices and risk mitigation measures for the industry. As the U.S. Government’s latest enforcement actions on June 2, 2020 demonstrate, OFAC sanctions enforcement attention is squarely focused on the international shipping industry.
The Guidance also provides important insights for companies operating in the maritime sector regarding the criteria that OFAC applies when evaluating an effective sanctions compliance program for such companies.
Below we summarize key points from the Guidance that are relevant for the shipping sector, including a summary of deceptive practices highlighted in the Guidance, a summary of general practices for effective identification of potential sanctions evasion and summaries of guidance for certain actors in the maritime industry and country-specific guidance.
Deceptive Shipping Practices
The Guidance provides a summary of common tactics utilized to facilitate sanctionable or illicit maritime trade linked to Iran, North Korea and Syria, including:
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Disabling or manipulating the Automatic Identification System (AIS) on vessels to conceal a vessel’s port of call or other information regarding its voyage.
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Physically altering vessel identification to obscure the identities of sanctioned vessels or vessels engaging in sanctionable activities.
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Falsifying cargo and vessel documents, particularly with respect to shipments involving petrochemicals, petroleum, petroleum products, metals (steel, iron) or sand to disguise their origin.
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Ship-to-Ship (STS) Transfers used to conceal origin/destination of products.
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Voyage irregularities to disguise the ultimate destination or origin of cargo, including indirect routing, unscheduled detours or transit or transshipment of cargo through third countries.
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False flags and flag hopping (i.e., repeatedly registering vessels with new flag states).
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Use of complex ownership or management to disguise the ultimate beneficial owner of cargo or commodities in order to avoid sanctions or other enforcement actions.
General Practices for Effective Identification of Sanctions Evasion
The Guidance also highlights, and provides details regarding, the following practices for effective identification of potential sanctions evasion:
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Institutionalizing a sanctions compliance program, including through the implementation of written standardized operational compliance policies, procedures, standards of conduct and safeguards.
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Establishing AIS best practices and contractual requirements that make disabling/manipulating AIS for illegitimate reasons grounds for termination of contracts or investigations.
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Monitoring ships throughout the entire transaction lifecycle, including through supplementing AIS with Long Range Identification and Tracking (LRIT) and receiving periodic LRIT signals on a frequency informed by the entity’s risk assessment.
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Conducting “Know Your Customer” due diligence on customers and counterparties, which could include “maintaining the names, passport ID numbers, address(es), phone number(s), email address(es), and copies of photo identification of each customer’s beneficial owner(s).”
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Exercising supply chain due diligence, including, as appropriate, conducting due diligence to ensure that recipients and counterparties to a transaction are not sending or receiving commodities that may trigger sanctions, such as Iranian petroleum or North Korea-origin coal, and implementing controls that allow for verification-of-origin and recipient checks for ships that conduct STS transfers.
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Incorporating the above “best practices” into contracts.
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Sharing information about sanctions evasion techniques and threats amongst industry groups.
Annex A: Actor-specific Guidance
In Annex A, the Guidance provides bulleted lists of guidance and information for particular actors within the maritime industry, including: maritime insurance companies, flag registry managers, port state control authorities, shipping industry associations, regional and global commodity trading, supplier, and brokering companies, financial institutions, ship owners, operators, and charterers, classification societies, vessel captains and crewing companies.
Below we summarize the guidance with respect to ship owners, operators and charterers, vessel captains and crewing companies.
Ship Owners, Operators, and Charterers:
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Identify vessels that, in the past two years, have a pattern of AIS manipulation not consistent with the International Convention for the Safety of Life at Sea and terminating business relationships with clients that continue to use those vessels.
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Keep and analyze records, including, where possible, photographs, of delivery and recipient vessels and/or recipients located at ports when possible, to enhance end-use verification.
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Protect employees who reveal illegal or sanctionable behavior from retaliation.
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Incorporate data into due diligence practices from organizations that provide commercial shipping data.
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Communicate to counterparts as necessary and appropriate (e.g., ship owners, managers, charterers, operators) an expectation that they have adequate and appropriate compliance policies.
Vessel Captains:
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Ensure deck officers are aware of the International Maritime Organization’s (IMO) AIS regulations, including the requirement to consistently broadcast AIS transmissions.
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Communicate to ship owners and charterers that vessels are monitored for AIS disablement and that any occurrences of AIS disablement will be investigated.
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Understand vessels’ AIS history to determine whether they may have been involved in illicit activities.
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Before engaging in ship-to-ship transfers, verify the other vessel’s name, IMO number and flag, and ensure there is a legitimate business purpose for the transfer.
Crewing Companies:
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Ensure crewmembers are aware of IMO guidance in relation to illicit shipping and the reasons why certain practices are unsafe.
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Communicate to clients that crews are monitored for AIS disablement and that any occurrences of AIS disablement will be investigated.
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Understand vessels’ AIS history to determine whether it may have been involved in illicit activities.
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Ensure that crewmembers who reveal illegal or sanctionable activity are protected from retaliation and providing a confidential mechanism for reporting sanctionable conduct.
Annex B: Country Guidance
In Annex B, the Guidance summarizes relevant provisions of U.S. and U.N. sanctions programs concerning North Korea, Iran and Syria and actions prohibited under said programs relevant to the maritime industry. It also highlights a few points with respect to recent deceptive practices to facilitate illicit shipping to North Korea, Syria, and Iran which are summarized below.
North Korea:
North Korea reportedly exported 3.7 million metric tons of coal between January and August 2019, in violation of U.N. sanctions. Further, while under United Nations Security Council Resolution 2397, North Korea is limited to importing a maximum of 500,000 barrels of petroleum per year, from January to October 2019. North Korea ports received 221 tanker deliveries, which, if fully laden, would result in approximately 3.89 million barrels of imports. According to the Guidance, these illicit exports and imports are primarily effectuated via ship-to-ship transfers in Chinese territorial seas. Image 1 below depicts the most common areas in which such ship-to-ship transfers take place.
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Common Locations of Ship-to-Ship Transfers subverting North Korean Sanctions1 |
North Korea is also reportedly acquiring vessels destined for scrapping and non-ocean-going barges that do not transmit AIS signals to engage in illicit import/export operations.
Syria:
The Guidance notes that “the supply chain and petroleum-related shipments [to Syria] create significant sanctions risk for those in the maritime industry.” As an example, it highlights the September 2019 OFAC action against Maritime Assistance LLC for facilitating the sale and delivery of jet fuel to Russian military forces operating in Syria. It also highlights the OFAC action in the November 2018 scheme in which Iranian and Russian entities engaged in a payment offsetting arrangement in which the sale and shipment of Iranian oil to Syria provided funding to Iran and proxy groups such as Hizballah, the Islamic Resistance Movement (HAMAS) and the Islamic Revolutionary Guard Corps-Quds Force (IRGC-QF).
Iran:
The Guidance did not provide specific guidance with respect to deceptive shipping practices used to subvert Iran-related sanctions—rather, it noted that the IRGC-QF continues to try to evade U.S. sanctions “by obfuscating the origin, destination, and recipient of oil shipments,” stating that “the use of such deceptive tactics is unique neither to Iran nor to Iran’s petroleum industry.”
Companies in the shipping industry or whose businesses intersect the shipping sector should assess their sanctions risk in light of this latest U.S. government guidance and make necessary modifications or enhancements to their compliance programs to mitigate this risk.
Source: Akin Gump, Strauss Hauer & Feld LLP
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Monday, 01 June 20
SUPRAMAX: IN SOUTH EAST ASIA RATES TRADED SIDEWAYS - BALTIC BRIEFING
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COVID-19: COAL SUPPLY BY CIL TO POWER SECTOR DIPS 22% TO 32 MT IN APRIL DUE TO DEMAND SLUMP - PTI
Over 95% of CIL’s production comes from its 171 open cast mines.
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The Centre is likely to launch the process of coal blocks auction under commercial mining on June 11 and around 50 mines are expected to go under t ...
Friday, 29 May 20
KOMIPO ON BEHALF FIVE KOREAN GENCOS INVITED COAL BIDS FOR 5,700 & 4999 NCV COAL FOR AUGUST 2020 LOADING
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Showing 941 to 945 news of total 6871 |
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- Simpson Spence & Young - Indonesia
- Sojitz Corporation - Japan
- Bukit Makmur.PT - Indonesia
- Vedanta Resources Plc - India
- Global Business Power Corporation, Philippines
- CNBM International Corporation - China
- Indika Energy - Indonesia
- Star Paper Mills Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Banpu Public Company Limited - Thailand
- Sree Jayajothi Cements Limited - India
- Malabar Cements Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Kobexindo Tractors - Indoneisa
- Bangladesh Power Developement Board
- Jorong Barutama Greston.PT - Indonesia
- Riau Bara Harum - Indonesia
- Carbofer General Trading SA - India
- Merrill Lynch Commodities Europe
- Global Green Power PLC Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Semirara Mining Corp, Philippines
- Port Waratah Coal Services - Australia
- Gujarat Sidhee Cement - India
- Semirara Mining and Power Corporation, Philippines
- Mjunction Services Limited - India
- Africa Commodities Group - South Africa
- Sarangani Energy Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Central Java Power - Indonesia
- Siam City Cement - Thailand
- Meenaskhi Energy Private Limited - India
- Energy Link Ltd, New Zealand
- Bukit Asam (Persero) Tbk - Indonesia
- MS Steel International - UAE
- ASAPP Information Group - India
- Coastal Gujarat Power Limited - India
- Australian Commodity Traders Exchange
- Orica Australia Pty. Ltd.
- AsiaOL BioFuels Corp., Philippines
- Videocon Industries ltd - India
- Kumho Petrochemical, South Korea
- Sakthi Sugars Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Madhucon Powers Ltd - India
- Parry Sugars Refinery, India
- Standard Chartered Bank - UAE
- Indian Oil Corporation Limited
- Pendopo Energi Batubara - Indonesia
- Bayan Resources Tbk. - Indonesia
- Toyota Tsusho Corporation, Japan
- Heidelberg Cement - Germany
- Holcim Trading Pte Ltd - Singapore
- Kartika Selabumi Mining - Indonesia
- Timah Investasi Mineral - Indoneisa
- IEA Clean Coal Centre - UK
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Transport, Egypt
- OPG Power Generation Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- McConnell Dowell - Australia
- Barasentosa Lestari - Indonesia
- Interocean Group of Companies - India
- Central Electricity Authority - India
- Directorate General of MIneral and Coal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kapuas Tunggal Persada - Indonesia
- CIMB Investment Bank - Malaysia
- Altura Mining Limited, Indonesia
- Posco Energy - South Korea
- Ceylon Electricity Board - Sri Lanka
- Offshore Bulk Terminal Pte Ltd, Singapore
- Metalloyd Limited - United Kingdom
- International Coal Ventures Pvt Ltd - India
- Chamber of Mines of South Africa
- Petron Corporation, Philippines
- Bhushan Steel Limited - India
- Coal and Oil Company - UAE
- Globalindo Alam Lestari - Indonesia
- GVK Power & Infra Limited - India
- Maheswari Brothers Coal Limited - India
- Energy Development Corp, Philippines
- Oldendorff Carriers - Singapore
- Vizag Seaport Private Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Thai Mozambique Logistica
- Cement Manufacturers Association - India
- Kalimantan Lumbung Energi - Indonesia
- Ind-Barath Power Infra Limited - India
- Parliament of New Zealand
- Indonesian Coal Mining Association
- New Zealand Coal & Carbon
- Latin American Coal - Colombia
- Billiton Holdings Pty Ltd - Australia
- London Commodity Brokers - England
- IHS Mccloskey Coal Group - USA
- Manunggal Multi Energi - Indonesia
- Bhoruka Overseas - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Sical Logistics Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Intertek Mineral Services - Indonesia
- Global Coal Blending Company Limited - Australia
- Tamil Nadu electricity Board
- Mercator Lines Limited - India
- Eastern Energy - Thailand
- Kaltim Prima Coal - Indonesia
- Jindal Steel & Power Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Straits Asia Resources Limited - Singapore
- Kohat Cement Company Ltd. - Pakistan
- Kideco Jaya Agung - Indonesia
- Directorate Of Revenue Intelligence - India
- Coalindo Energy - Indonesia
- Anglo American - United Kingdom
- SMC Global Power, Philippines
- Dalmia Cement Bharat India
- Planning Commission, India
- Price Waterhouse Coopers - Russia
- Miang Besar Coal Terminal - Indonesia
- Singapore Mercantile Exchange
- Electricity Authority, New Zealand
- Antam Resourcindo - Indonesia
- SMG Consultants - Indonesia
- Iligan Light & Power Inc, Philippines
- PTC India Limited - India
- Indogreen Group - Indonesia
- Ministry of Finance - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Tata Chemicals Ltd - India
- Wilmar Investment Holdings
- Jaiprakash Power Ventures ltd
- Goldman Sachs - Singapore
- Minerals Council of Australia
- Marubeni Corporation - India
- White Energy Company Limited
- Ministry of Mines - Canada
- Formosa Plastics Group - Taiwan
- SN Aboitiz Power Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Bukit Baiduri Energy - Indonesia
- Salva Resources Pvt Ltd - India
- Bhatia International Limited - India
- PowerSource Philippines DevCo
- Asmin Koalindo Tuhup - Indonesia
- Samtan Co., Ltd - South Korea
- San Jose City I Power Corp, Philippines
- Deloitte Consulting - India
- Romanian Commodities Exchange
- GAC Shipping (India) Pvt Ltd
- Mintek Dendrill Indonesia
- Grasim Industreis Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Krishnapatnam Port Company Ltd. - India
- Lanco Infratech Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- India Bulls Power Limited - India
- Orica Mining Services - Indonesia
- Georgia Ports Authority, United States
- ICICI Bank Limited - India
- Sinarmas Energy and Mining - Indonesia
- Sindya Power Generating Company Private Ltd
- Wood Mackenzie - Singapore
- Gujarat Electricity Regulatory Commission - India
- Borneo Indobara - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Power Finance Corporation Ltd., India
- Essar Steel Hazira Ltd - India
- Aboitiz Power Corporation - Philippines
- Siam City Cement PLC, Thailand
- VISA Power Limited - India
- The State Trading Corporation of India Ltd
- Binh Thuan Hamico - Vietnam
- Commonwealth Bank - Australia
- Indo Tambangraya Megah - Indonesia
- Australian Coal Association
- Bulk Trading Sa - Switzerland
- Renaissance Capital - South Africa
- European Bulk Services B.V. - Netherlands
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Attock Cement Pakistan Limited
- Makarim & Taira - Indonesia
- The Treasury - Australian Government
- Xindia Steels Limited - India
- Edison Trading Spa - Italy
- Agrawal Coal Company - India
- Maharashtra Electricity Regulatory Commission - India
- Larsen & Toubro Limited - India
- Indian Energy Exchange, India
- Medco Energi Mining Internasional
- Chettinad Cement Corporation Ltd - India
- Rio Tinto Coal - Australia
- Aditya Birla Group - India
- Economic Council, Georgia
- Savvy Resources Ltd - HongKong
- South Luzon Thermal Energy Corporation
- Ambuja Cements Ltd - India
- Eastern Coal Council - USA
- Kepco SPC Power Corporation, Philippines
- Mercuria Energy - Indonesia
- GMR Energy Limited - India
- Thiess Contractors Indonesia
- Bharathi Cement Corporation - India
- Independent Power Producers Association of India
- Trasteel International SA, Italy
- The University of Queensland
- PNOC Exploration Corporation - Philippines
- Leighton Contractors Pty Ltd - Australia
- Electricity Generating Authority of Thailand
- Uttam Galva Steels Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Meralco Power Generation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Baramulti Group, Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Karaikal Port Pvt Ltd - India
- TeaM Sual Corporation - Philippines
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