Armed guards at sea

The International Chamber of Shipping (ICS) has reluctantly accepted that “many shipping companies have concluded that arming ships is a necessary alternative to avoiding the Indian Ocean completely”.

ICS chairman, Spyros M Polemis, said that the decision to engage armed guards, whether military or private, must be made by the ship operator and be subject to the approval of the vessel’s flag state and insurers.

But he warned: “The consensus view amongst shipping industry associations remains that, in normal circumstances, private armed guards are not recommended, and are a clear second best to military personnel.”

Seafarers' union Nautilus has also agreed to the use of private armed guards when it is clear that no other means of protecting seafarers is available. The union says the use of armed guards onboard a vessel would not remove the right of seafarers under union-recognised agreements to refuse to sail into a high-risk area.

Mr Polemis, said: "ICS has had to acknowledge that the decision to engage armed guards, whether military or private, is a decision to be made by the ship operator after due consideration of all of the risks, and subject to the approval of the vessel’s flag state and insurers.” He added that in view of the current crisis in the Indian Ocean - “with over 700 seafarers held hostage and, most recently, a seafarer being executed – ship operators must be able to retain all possible options available to deter attacks and defend their crews against piracy”.

He noted: “Many shipping companies have concluded that arming ships is a necessary alternative to avoiding the Indian Ocean completely, which would have a hugely damaging impact on the movement of world trade."

He said: "The eradication of piracy is the responsibility of governments. Frustratingly, politicians in those nations with the largest military navies in the region show little willingness to increase resources to the extent that would be necessary to have a decisive impact on the problem of piracy. Western governments, at least, appear to give the impression that this otherwise unacceptable situation can somehow be tolerated. Sadly, until we can persuade governments otherwise, the use of armed guards by ships is very likely to continue increasing."

Meanwhile a Russian seafarers’ union has called on the country's president to take a proactive approach to piracy by initiating a United Nations (UN) resolution. Igor Pavlov, president of the Seafarers’ Union of Russia, urged the president to consider preparing a resolution on the creation of a multinational force to police the Indian Ocean. The resolution would aim to establish a naval blockade of Somalia, which would mean that any vessel leaving the territorial waters of Somalia would undergo checks. Other measures, such as providing aid or offering Somalis alternative ways of earning a living, could also be taken, he said.

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The UK's controversial Bribery Act, passed by parliament last April and due to come into force this April, has been delayed after widespread concern that the guidance on the new rules was unclear. The delay to this legislation, intended to bring UK law more in line with the US Foreign and Corrupt Practices Act, is likely to be welcomed by the shipping industry. The government has however made clear that the law will eventually come into force.

Just before the delay was announced shipowners representative organisation BIMCO had issued a statement warning of potential severe consequences for international trade and the shipping sector worldwide due to its provisions relating to various bribery offences combined with the fact that it will have extraterritorial application and thus, in principle, apply also to offences committed outside the United Kingdom and by foreign commercial organisations with a business presence in the United Kingdom.

One of BIMCO’s main concerns with respect to the Bribery Act relates to its possible prohibition on so-called facilitation payments made by crew members, shipping agents and others to be treated fairly and according to the law by public officials in certain countries and regions, for example in relation to port calls.

BIMCO said: “While being strongly opposed to corruption and fundamentally against facilitation payments, it must be recognised that there are ports where such practices are common and almost impossible to counter. A prohibition could therefore make it practically impossible for shipping companies to carry out their legitimate activities in some parts of the world and risk distorting competition.”

According to the specific wording of the Bribery Act, it is an offence to induce a person to perform improperly a relevant function or activity. This could give the impression that facilitation payments are not illegal per se in cases such as those described above relating to port calls.

“Nevertheless,” BIMCO warns, “as no specific exemption is spelled out this remains uncertain and will ultimately be a matter for the courts of the United Kingdom to decide”.

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Global accountancy firm and Maritime London member Deloitte has called for action on numerous fronts to encourage the recruitment and retention of young people to the shipping profession and “tip the supply of seafarers in a positive direction.”

In a report titled “Challenge to the industry: securing skilled crews in today’s marketplace”, written by Deloitte’s shipping & ports group, trade organisations are called on to invest in public awareness campaigns; requirements for admission to marine education courses upped; maritime ciricula expanded to incorporate decision-making, ethics, multi-cultural relations and foreign languages; tax obligations rationalised for seafarers and a greater flexibility on national requirements for crew composition.

Based on a survey of 23 shipping companies representing 1,125 vessels, the report found that average European master salaries were USD 8,750 per month, whilst European ordinary seamen salaries were an average of USD 899 per month. 75% of ratings working aboard European vessels were found to be Philippinos.

Click here to download a full copy of the report.

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Nautilus International and Prospect have made a joint submission to the House of Commons Transport committee for its enquiry into the work of the Maritime and Coastguard Agency (MCA), as the unions representing MCA employees. The unions said in a statement that they welcomed the committee’s decision to conduct the inquiry into the work of the MCA and were strongly supportive of the MCA’s core functions and responsibilities.

The submission states: "We are particularly concerned that the government spending cuts will have seriously detrimental effect on the MCA’s ability to discharge vital safety duties and will exacerbate existing problems that have been identified in previous investigations."

The unions say that do not believe the MCA has been given the resources and staffing it needs to meet increasing national and international regulatory responsibilities which could have serious a consequences. There will be dire consequences if the proposed cutbacks, which include the loss of “vital” services such as Emergency Towing Vessels and specialist offshore emergency services, go ahead claim the unions.

The submission calls on the government to reassess the shipping policies laid out in the Charting a New Course programme and work with all sides of the industry to set agreed strategic goals and objectives for the UK maritime sector.

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Global law firm Norton Rose reports that the Supreme Court has significantly narrowed the scope of exclusion for inherent vice written in marine cargo policies worldwide. In a case arising under an all risks cover on Institute Cargo Clauses A, the Court rejected the suggestion that an inability of cargo to withstand the expected weather conditions of the insured voyage can amount to inherent vice.

Insurers will now only have a defence of inherent vice where the loss is solely caused by some characteristic inherent to the insured property and where no external fortuity, such as perils of the sea, is involved.

According to Norton Rose, this important decision will undoubtedly impact upon current and future claims, particularly in relation to project cargoes, and may well influence underwriting practice in cases where progressive stress or fatigue damage is known to be highly likely to occur.

Click here to view a detailed briefing note prepared by Norton Rose.

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Four P&I mutual clubs belonging to the International Group Agreement – Steamship Mutual, UK Club, West of England and North of England – have declined to renew cover for Iranian shipping company NITC for the 2011/2012 policy year. The move comes as sanctions against Iran are being enforced more strictly. NITC says it has moved quickly to arrange alternative P&I cover for its fleet of modern tankers.

The company's chairman and managing director Mohammad Souri said: “We would like to point out that the clubs’ decisions in no way reflect on the claims history of our company, which enjoys an excellent safety record and has been a net contributor to the reserves of the clubs in question for a long time.”

He said: “NITC has found itself caught up in a situation of tightening sanctions as a totally innocent party, along with some 100 other Iranian shipping companies. We hope for an early resolution of this matter and speedy renewal of cover from International Group members.”

“In the meantime,” he continued, “the company has been obliged to ensure that alternative P&I arrangements are in place for all ships trading in its international fleet, up to the required level of $1 billion of pollution cover for each incident. That cover is being provided by a mixture of fixed-premium insurers and other insurance companies based outside the EU, with adequate and suitable reinsurance provision.”

According to Mr Souri the NITC fleet continues to trade normally in the service of international oil majors. He said: “The company is 100% privately owned, respects all international conventions and has never been engaged in any activity prohibited by the US, UN or EU. It upholds the highest operational standards and remains a reliable business partner in all shipping matters”.

Mr Souri added: “The question of sanctions which might affect NITC’s P&I arrangements has been pending for some six months, and we would like to thank all parties involved for their patience and support during this very difficult period.”

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Anti-fouling coating

The chairman of the UK parliament’s All Party Maritime and Ports Group, Julian Brazier, and environmental campaigner Jonathon Porritt have welcomed a new report confirming the energy savings that can be achieved using new antifouling coatings. According to a report from James Corbett of Energy and Environmental Research Associates, International Paint's Fluoropolymer Foul Release technology can reduce vessel greenhouse gas (GHG) and other emissions by an average of 9%.

Mr Brazier said: “The shipping industry is under significant pressure to demonstrate environmental leadership and innovation. This latest research suggests that viable solutions do exist. It also demonstrates the depth of innovation within UK manufacturing and the commitment and investment that is being made in developing ground-breaking technologies that can help to meet one of the biggest challenges that we face today.”

Prof Corbett’s study analysed the latest fuel consumption data of three vessel types with FFR coatings applied. The project used the Prem Divya, a single engine 21,126 horsepower (HP) tanker, the Ikuna, a twin engine 3,400 HP bulker and five identical post panamax container vessels, three of which were coated with TBT free polishing antifoulings and two with Fluoropolymer Foul Release technology.

The results showed that fuel consumption and therefore vessel emissions were reduced by 10% on the Prem Divya, 22% on the Ikuna and by 5% in the container vessels (based on all five ships carrying a comparable load).

The report states that if similar fuel efficiency results were realised by all tanker and bulk cargo vessels within the commercial fleet that: “annual fuel oil consumption could be reduced by roughly 16m tonnes per year, fuel expenditures could be reduced by USD4.4bn to USD8.8bn per year, and nearly 49m tonnes of CO2 emissions could be avoided annually”. The report showed that using FFRs would achieve cost savings.

The Prem Divya delivered a total annual fuel cost saving of USD251,000 based on a 2009 average bunker price (USD$387 per tonne). While Fluoropolymer Foul Release technology would cost USD645,000 more over a nine year period than a biocidal alternative, if this figure is deducted from 2009 bunker costs and projected over the same time period, the owners of Prem Divya would save USD1.614m. If current bunker prices of USD640 / tonne were used for the calculation, the annual savings would be USD415,000 and the projected net savings over 9 years would be USD3.09 million.

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Maritime London member BMT Group has taken part in a project to develop a new computerised system will enable crews to tackle fires and floods more effectively. The part EU-funded maritime transport project FLAGSHIP has developed what is claimed to be the first advanced emergency situation management tool for fire and flooding with integrated ship to shore real time reporting - FLAGSHIP-DSS (Decision Support System).

The system is designed to deliver an accurate, early prediction of how a fire or flooding may impact on a ship at any given time. The system should enable efficient decision-making in distress situations, reducing risk and enhancing the effectiveness of mitigating actions.

FLAGSHIP-DSS integrates prognosis tools for fire and flooding with an evacuation simulation process, an advanced on-board stability calculator as well as an on-board emergency management system. It constantly collects data from all ship sensors to assess the vessels vulnerability at any one time providing the captain and crew with information upon which they can take prompt remedial actions to effectively bring an unfolding crisis under control.

FLAGSHIP–DSS was led by the University of Strathclyde in the UK and was supported, delivered and trialled in conjunction with two British companies: Teekay Shipping and BMT Group; five Greek organisations: Altair Maritime Enterprise (subsidiary of Maran Tankers Management Inc.), Danaos Shipping Co Ltd, the National Technical University of Athens; Minoan Lines and Superfast Ferries S.A.; two Norwegian businesses: MARINTEK and Lodic AS and Instituto Superior Tecnico of Portugal.

Meanwhile BMT Group has acquired Western Australian-based coastal, port and harbour engineering firm, JFA Consultants.

Peter French, chief executive of BMT Group says: “Enhancing our presence in Western Australia through this acquisition will provide us with strong growth opportunities in the sectors we currently specialise in, as well as significantly broadening our capabilities in the fields of port development and coastal engineering. The expertise within the organisation is second to none and critical to the continued success of the business – we look forward to welcoming the JFA team as a part of the BMT Group.”

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