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Just as there is no easy route to decarbonisation, there is no straightforward way of balancing a shipowner’s obligation to comply with the MARPOL Carbon Intensity Indicator (“CII”) Regulations with a time charterer’s right to direct the employment of a vessel.

That much is clear from the long-awaited BIMCO CII Operations Clause for Time Charters 2022 and, more tellingly, from the industry reaction.

Now that the dust is settling: what does the clause actually say? What are the key sticking points? And how are owners and charterers positioning themselves before the CII Regulations come into force on 1 January 2023? In this briefing, we take a closer look at some of the emerging themes.…

Continue Reading BIMCO CII Clause for Time Charters – The dust begins to settle

Introduction

There cannot be many people left in the shipping sector unaware that the International Maritime Organisation (IMO) has set a target of reducing annual greenhouse gas emissions in shipping by at least 40% by 2030 and pursuing a 70% reduction by 2050.

As a key means of achieving this, the IMO, through the Marine Environment Protection Committee (MEPC) has adopted amendments to the International Convention for the Prevention of Pollution from Ships (MARPOL) Annex VI. These changes will implement major new technical rules called the Energy Efficiency Existing Ship Index (EEXI) and the Carbon Intensity Indicator (CII). The regulations are due to come into force on 1 January 2023, just over a year from now.

Put simply, EEXI is a framework for determining the efficiency of the design of in-service vessels over 400 GT falling under MARPOL Annex VI. The CII is an operational measure of how efficiently a ship transports goods or passengers measured, in essence, in grams of CO2 emitted by cargo-carrying capacity and nautical mile.

Both EEXI and CII are complex and evolving, with much of the detail still unclear. However, they need to be carefully considered and understood now so that those affected can start planning for January 2023.

In this article, we set out in an easy-to-use table the main points, and explain some of the key issues owners and charterers need to consider.
Continue Reading EEXI and CII – shipping’s next environmental challenge

Last month, the European Commission published two new proposals for EU regulations to encourage the use of sustainable fuels in aviation and shipping – namely the ReFuelEU Aviation and FuelEU Maritime initiatives, respectively. Both proposals are subject to public feedback until 5 October.

Continue reading. 

Beginning in May 2021, California Air Resources Board (“CARB”) enforcement staff will begin additional analysis of fuel samples taken during ocean-going vessel inspections. CARB is seeking to improve compliance due to changing international regulatory sulfur limits, which has created situations where a vessel’s fuel may meet international and California regulatory sulfur limits, but not meet…

The California Air Resources Board (“CARB”) has again proposed revisions to the State’s existing “Ocean-Going Vessels At-Berth Regulation” of air emissions from ships docked in California. As revised, further reductions in air emissions will be required, but some of the earlier implementation dates have been extended.

Most substantive changes were made in response…

There has been a tendency for reference to be made to Regulation 18 (of Annex VI of the International Convention for the Prevention of Pollution from Ships, 1973 as modified by the Protocol of 1978) as containing ‘exceptions’ to Regulation 14 (of the same), which sets out the maximum sulphur content limits for marine fuels.  While this…

On 21 December 2018 we commented on the newly released BIMCO clauses intended to address the International Maritime Organization’s revised sulphur content limits with regard to the consumption and carriage of marine fuel (in accordance with Regulation 14 of Annex VI of the International Convention for the Prevention of Pollution from Ships, 1973 as modified by the Protocol of 1978, MARPOL), which enter into force on 1 January and 1 March 2020 respectively.
Continue Reading Update on BIMCO 2020 Fuel Transition Clause for Time Charter Parties

On 1 January 2020 amendments to the International Maritime Organization’s (IMO’s) International Convention for the Prevention of Pollution from Ships (MARPOL) enters into force.

Read our Shipping Group’s latest whitepaper, by Ron Clark, on the 2020 Global Sulphur Cap at reedsmith.com.

Including topics covering:

  • 2020 SOx issues
  • An introduction to marine fuels
  • Abatement technology
  • Scrubbers

…

Last week, the Liberian flag state called for the IMO to issue a resolution or circular requiring early reporting of low-sulphur fuel availability by member states.  From the flag state’s point of view, littoral states should be doing more to assist shipowners and, by extension, time charterers in planning for compliance with the 1 January 2020 deadline for the global reduction of sulphur content (down to 0.5 per cent m/m) in marine fuels.
Continue Reading IMO 2020 and Liberia’s stance

In a survey conducted by Reed Smith in the first half of 2018, industry participants predicted that big data analytics will be one of the most significant drivers of change in the shipping industry over the next five years. In addition, for the same five-year period, the survey revealed that the shipping industry considers the development of automated processes and functions on board vessels to be the biggest driver of efficiency in shipping.

The collection, analysis and management of huge volumes of unstructured data (i.e., big data), such as data on voyage performance, ship structure, machinery, fuel consumption, traffic, cargo and the weather, are expected to provide valuable insights into the operation of ships, and uncover hidden patterns as well as market trends. The analysis of big data will also allow the prediction of likely outcomes in certain voyages. In addition, it is likely to reduce costs, as the industry will be able to identify more efficient ways of doing business; it will allow decisions to be made more quickly; and it will make shipping safer by reducing risks.
Continue Reading Big data analytics and autonomous vessels – when will legislation catch up?