UK based shipping related companies need policies to deal with frequent demands for bribes according to a report commissioned by the Corporation of London. The report: Avoiding Corruption Risks in the City: The Bribery Act 2010 was written by Transparency International and published following a new Bribery Act which received Royal Assent in April 2010.

The report finds that 38% of respondents to its survey believe that the City’s maritime sector is “high risk”.

According to the report’s authors, the four factors that put City businesses at greatest risk of corruption are those operating in corrupt environments; those which interact with public officials; those which provide services to high risk sectors such as defence and natural resources sectors and those who use agents, counter-parties, rely on subsidiaries, or enter into joint ventures.

The report states: “Given that operating in corrupt environments is a key risk factor, it is not surprising that the sectors of maritime and shipping and commodities are perceived as high risk. Risks in maritime and shipping largely relate to demands for facilitation payments to cross borders quickly or reduce tariff payments.”

The report adds: “Monitoring of smaller shipping companies could be improved. Moreover, smaller shipping companies based in the City often act as intermediaries, chartering ships for specific jobs, financing trade, or buying and selling small amounts of commodities. There is considerable scope for inducements and commission payments that could be interpreted as bribes. Such companies may be especially prone to take a flexible approach to business ethics if they are not FSA-registered.”

Under the new Bribery Act companies can face unlimited fines, while directors can be imprisoned for up to ten years for failing to have ‘adequate procedures’ to prevent bribery. Hospitality, publicity, insider information, and donations to charity could all be considered as bribes in certain circumstances. An individual can be liable for accepting an advantage even if he/she did not know that the other party intended to induce improper conduct. Companies can also be liable for bribes paid by subsidiaries, agents or partners in joint ventures.

The report recommends that companies assess their vulnerability to corruption risk in all areas of business and their potential exposure and liabilities under the new Bribery Act. Companies are advised to design and implement robust procedures to prevent bribery and corruption occurring whilst professional associations should advise their members on how to deal with sector-specific corruption risks.

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Maritime London will once again by running a pavilion at next week’s Posidonia trade show in Athens. Participating companies include the Baltic Exchange, Clarkson Research Services, Drum Cussac, Harbour Insurance Brokers, Lloyd's Agency Department, Maritime & Coastguard Agency, Rightship and Thomson Reuters.

The pavilion will be opened by the Lord Mayor of London and will feature an internet cafe area. The new UK Maritime Services directory produced on behalf of Maritime London will also be distributed at the show.

Do come and see us at stand 280.

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Mike Penning MP

The Chamber of Shipping has welcomed the appointment of the new ministerial team in the Department for Transport. Mike Penning, MP for Hemel Hempstead, has been appointed Shipping Minister, reporting to Phillip Hammond as Secretary of State. Theresa Villiers and Norman Baker complete the team, providing the Chamber says “a considerable breadth of knowledge on the transport industry”.

Chamber director general Mark Brownrigg highlighted the strong relationship that the trade association has always enjoyed with the department: "We have enjoyed a constructive relationship with Theresa Villiers and Norman Baker for some time, during their time as shadow Secretaries of State. We very much look forward to building the same positive relationships with Mike Penning and Phillip Hammond, and I welcome them all to the Department."

Mr Brownrigg explained that he was confident the new Government would engage proactively with the shipping community saying: “In opposition, both the Conservatives and Liberal Democrats engaged fully with the sector’s concerns over Light Dues, the environment and providing a stable tax regime. The Chamber of Shipping stands ready to support the Ministerial team, providing industry expertise to help them make the decisions that will secure this vital sector for the future.”

Meanwhile Nautilus has written to the new Secretary of State seeking assurances on addressing critical issues affecting the UK shipping industry and British seafarers. Nautilus says that, due to “considerable concerns about UK shipping and its ability to compete in an increasingly tough market”, it wishes to discuss the economic and strategic importance of shipping and focus on further expanding on the potential that the tonnage tax brings the sector.

Union general secretary, Mark Dickinson says long-term prospects on UK seafarer training and employment remain bleak – with the latest UK Seafarers Analysis, published by the Department for Transport in April, indicating that on current trends the number of certificated UK officers will decline by 38% over the next 20 years.

The situation for ratings is even starker, Nautilus says. Mr Dickinson highlights a meeting which took place earlier this year between all sides of the industry, the prime minister, the DfT and the Department for Business, Innovation & Skills, where ways on finding effective ways of supporting maritime training and education through access to government schemes for apprenticeships and adult skills training was discussed.

“We believe progress on this is urgently needed, and I hope we can have assurances from you about the continued work in this area,” Mr Dickinson states in his letter. He continues: “There are many other issues of importance, including progress on the UK ratification of the Maritime Labour Convention 2006, support for the IMO/ILO fair treatment guidelines for seafarers, ratification of the international convention on seafarers’ identity documents, and increasing pressures faced by the Maritime & Coastguard Agency in upholding high standards on UK ships. Furthermore, staffing and resources for the MCA, support for environmentally-friendly initiatives to encourage the transfer of freight from roads to water, and piracy and armed attacks on merchant shipping needs to be addressed.”

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What is being described as an “unprecedented” coalition of organisations – from trade unions to shipowners’ associations and insurers – has joined forces to back a global e-petition demanding concrete action to end the piracy that is putting lives at risk and threatening world trade. The petition www.endpiracypetition.org, launched last week is the centrepiece of a new campaign to persuade all governments to commit the resources necessary to end the increasing problem of Somalia-based piracy. It is intended to deliver at least half a million signatures to governments by IMO World Maritime Day, 23 September.

The petition calls on governments to:

• Dedicate significant resources and work to find real solutions to the growing piracy problem.
• Take immediate steps to secure the release and safe return of kidnapped seafarers to their families
• Work within the international community to secure a stable and peaceful future for Somalia and its people

The campaign is being backed by BIMCO, ICS, IFSMA, IMEC, IPTA, Intercargo, InterManager, International Group of P&I Clubs, INTERTANKO, ISF, ITF, IUMI and SIGTTO, as well as national shipowners’ associations and trade unions worldwide.

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London Thamesport says the arrival of a new ship-to-shore gantry crane has boosted the terminal's operational capability. The new crane is the second new arrival in two years at the Kent port, bringing the total number of ship-to-shore gantry cranes to eight. It was delivered by Zhenhua Port Machinery Company (ZPMC) of Shanghai. The ultra post-panamax unit is capable of handling the latest generation of container ships. It has an outreach of 62.5 metres, and the crane can handle vessels with containers stowed 22-wide on deck.

Commenting on the new arrival, David Gledhill, ceo of Hutchison Ports (UK), which owns London Thamesport, said: “This new crane is further evidence of our continued commitment to investing in London Thamesport and maintaining its position as one of the UK’s leading container terminals. With eight cranes at the port, there is capacity to accommodate additional traffic, and by ensuring the availability of state-of-the-art equipment, we are able to offer the quickest vessel turnarounds for our customers.”

The arrival of the new crane coincided with the granting of outline planning permission for a vast business park in North Kent, on the doorstep of London Thamesport. The application for the Grain Business Park was submitted by Thamesport Interchange, which plans to use the 164ha site for industrial and port related purposes.

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The London P&I Club made a financial year surplus of $25.9m for the year ended 20 February, 2010. The club’s annual report will be published in July. But a summary of results for the 2009/10 financial year notes that the surplus achieved by the Club served to increase free reserves by 22 per cent to USD141.4m.

Ian Gooch, chief executive of the Club’s management team, says, “Progress has been made towards balancing premium income with claims and operating costs, and is continuing through other measures, including the strengthening of rating levels and adjustments to deductible structures”.

He adds: “The London P&I Club’s free reserves have strengthened and we continue to make steady progress across the business. This includes the support which the Club enjoys from high-class owners and operators, particularly those in the dry bulk, tanker and container sectors. Taking into account tonnage entered since the last renewal, current membership stands at almost 40m gt.”

Claims incurred net of reinsurance increased to $106.1m. Although there was a significant reduction in the aggregate cost of claims below $1m, there was an increase during the year in the number of claims notified to the International Group Pool, three of which involved members of the club.

The main driver of its increased claims cost, however, was an unusually high incidence of larger retained claims, particularly during the first six months of the year. During the year, the Club made a 14% return on cash and investments amounting to $42.7m. Fixed income holdings remained the dominant asset class in the investment portfolio and a feature of the return was the strong performance relative to the benchmark of these assets. During the course of the year, the Club received entries from existing members – principally in Germany and China – and from new members in Greece and different parts of the Far East.

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The London-based industry association the Greek Shipping Co-operation Committee (GSCC) and Maritime London member has elected Haralambos J Fafalios as its new chairman to succeeds Epaminondas Embiricos who has stood down after 11 years.

Mr Fafalios, a London Greek, was born in 1961 and comes from a long time seafaring family from Chios. Both his grandfathers were seafarers, while he himself is proud to have first – hand knowledge of the profession, having served three terms at sea. He was educated in London then completed his university studies in Newcastle. He has worked with his family company, Fafalios Ltd, as a Baltic shipbroker for over 25 years and is actively engaged in chartering on a daily basis.

The GSCC says that Mr Fafalioshas a working knowledge of marine insurance, banking and all aspects of shipbroking. He presently sits on various industry bodies, including the Board of the Baltic Exchange, and Intercargo and the American Bureau of Shipping committees. He was first elected as a member of the GSCC Council in 2002, succeeding his father, John D Fafalios, who served on its Board for many decades.

Mr Embiricos, in his final chairman's report, was highly critical of EU maritime policies. He wrote: “Much of the work of the Committee has been aimed at seeking to contain adverse regulation and/or legislation flowing from the unfortunate losses of the “Erika” and later of the “Prestige”. These casualties led to significant hostility towards the maritime sector amongst EU politicians and bureaucrats, resulting in multiple threats of unilateral EU action, inimical to the interests of the shipping industry, and in unhelpful and detrimental proposals being put forward by the EU to the IMO.”

He continued: “The EU’s Shipping Policy has, over the last decade, been misguided. The EU, and in particular the EU Commission, view their responsibilities in relation to the Shipping Sector as being those of a regulator. The EU has failed to recognise the importance of its Shipping Sector both to the EU economy generally and to employment within the EU. It would be unwise for the EU, which is a major trading bloc, to have to rely, in the future, on non-EU vessels to transport its trade. Yet, unless the EU changes policy and becomes much more supportive of its shipping industry, this is a very realistic prospect. EU shipping faces severe competition from Far Eastern interests, which enjoy much lower wage costs, both on board and ashore, and which control many cargoes as well as shipyards. It has been a key aim of the Committee to try to get this message across to the EU. This is, however, still a work in progress.”

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Maritime London member Warsash Maritime Academy recently demonstrated its new six-bridge simulator at a recent seminar for senior members of the UK's shipping community including Port of London Authority and Maritime and Coastguard Agency executives and also to the shipping press.

Warsash says its new facility takes training for sea-going navigators to a new level. Fitted with the most up-to-date electronic chart equipment, the simulator will play a major part in preparing navigators for 2012, when changes in legislation will mean that many ships will stop using traditional paper charts for ever.

Because the simulator has six interactive bridges, it will be able to create some of the most complex and hazardous vessel traffic situation that seafarers are likely to meet. Crossing traffic in confined channels, engine failures in close quarters situations and the avoidance of small craft in the Solent can all be practised in complete safety.

Bob Joughin, head of the School of Maritime Studies, said: “Around 80% of accidents at sea are caused by human error, so it’s vital that navigators are given the best possible preparation for the demand of their profession.”

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International design, engineering and risk management consultancy BMT Group achieved a record turnover of £142m and boosted profits by 55% to £12m in the year to 30 September 2009. Of this profit, £5.3m has been distributed to the staff through the company’s profit share schemes.

The company, which is celebrating its 25th anniversary, experienced particularly strong growth in the Americas and Asia Pacific. The company says that the 23 companies that comprise the BMT group have successfully reinforced the organisation’s maritime offering in its three core sectors of defence, energy & environment and transport.

Highlights included: the renewal of the UK MoD’s Submarine Support Management Group (SSMG) contract to provide engineering support to the Royal Navy’s nuclear submarine flotilla; successful completion of an environmental impact and marine navigation safety risk assessment for Hong Kong’s first offshore wind farm; and the continued deployment of BMT’s innovative real-time performance monitoring and trend analysis tool SMARTPOWER working with a growing number of major tanker and LNG fleet operators.

BMT Group chief executive Peter French said: “Our resilience is due, in part, to the non commoditised nature of our work in which our specialist knowledge has continued to demonstrate its value even in difficult markets. We have also benefited from the diversification that we have been careful to build over the last few years. However, we would not have been able to achieve these results if not for our people. They have worked tirelessly to deliver exceptional projects for clients all around the world.”

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Lloyd's Register North America is to conduct ILO gap analysis for Roymar Ship Management Roymar. It has signed a contract to provide services to help Roymar prepare for certification for the International Labor Organization’s (ILO) new Maritime Labor Convention (MLC), 2006. Expected to come into force in early 2012, MLC, 2006 sets minimum requirements for decent living and working conditions for seafarers on board ships, so enhancing safety and helping create conditions for fair competition among shipowners.

“We certainly want to comply with statutory requirements, but beyond that, we want to look after the well-being of our seafarers,” said Ron Tursi, president, Roymar. “Even though MLC, 2006 has not been ratified yet, we can still benefit from implementing its requirements now.”

The Lloyd’s Register Group of entities has now completed more than 100 MLC, 2006 trial inspections worldwide on the full range of ship types, from the largest cruise liners to small coastal vessels.

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A consortium led by the Maritime and Coastguard Agency (MCA) has launched The Human Element: a guide to human behaviour in the shipping industry which explains how human behaviour lies at the centre of both the profits and the losses of the shipping industry – and what companies can do about it. Put together by organisational psychologists, the guide shows how human behaviour is at the heart of the shipping industry, generating its successes and its failures.

The guide provides insight, explanation and advice to help everyone involved in the global shipping industry manage the human element more safely, more effectively, and more profitably. Analysis of continuing shipping disasters has increasingly implicated the human element. The loss of life, the impact on company profits and credibility, and the vast environmental damage that can result from the loss of even a single vessel remain clear and present dangers.

Captain David Turner, head of the development project at the MCA said, "In the shipping industry, human behaviour is the true secret of our success. But it also makes us the victims of our failures. This guide shows how to navigate a course between the two - resulting in increased profits and better safety for all.” He added that it shows that managing the human element must take place simultaneously at all levels of the industry – from deep within the engine rooms and decks of the smallest cargo ships, through company boardrooms to the international conventions of the IMO.

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