Memorandum submitted by the Maritime and
Coastguard Agency
DISMANTLING OF DEFUNCT SHIPS
EXECUTIVE SUMMARY
1. The Maritime and Coastguard Agency (MCA)
have been involved in the issue of ship-recycling through the
discussions at the International Maritime Organisation (IMO).
The purposes of the Organisation, as summarised by Article 1(a)
of the Convention on the International Maritime Organisation (1958),
are:
"to provide machinery for co-operation
among Governments in the field of governmental regulation and
practices relating to technical matters of all kinds affecting
shipping engaged in international trade; to encourage and facilitate
the general adoption of the highest practicable standards in matters
concerning maritime safety, efficiency of navigation and prevention
and control of marine pollution from ships".
2. The MCA have the policy lead for the
UK on Ship-recycling at IMO. Ship recycling has, over the last
few years, become a major issue within the IMO's Marine Environment
Protection Committee. This work has led to the development of
the IMO's voluntary Guidelines on Ship-recycling, these were adopted
by the IMO Assembly in November 2003[4]
These Guidelines were developed after close consultation with
the international shipping industry, major flag states and ship
recycling countries and will be outlined in this submission.
3. The MCA fully recognises the need for
environmentally sound management of ship recycling and that recycling
yards across the globe should conform to internationally acceptable
health, safety and environmental standards. However, there is
currently significant confusion in the international system controlling
ships intended for recycling. There are ongoing discussions at
the international level as to whether the controls of the Basel
Convention can be applied to ships that have specific rights as
laid down in the United Nations Convention on the Law of the Sea
(UNCLOS).
4. In contributing to this international
debate, the MCA have additionally recognised the need for a pragmatic
and workable solution for the recycling of UK Flagged Ships (which
include UK Government owned ships) within the international control
mechanism of shipping.
5. The MCA have also sought to highlight
further questions that need to be addressed when considering the
issue of ship recycling in the wider international context and
have made some concluding points intended to stimulate debate
on the issue of ship recycling.
EFRA COMMITTEE QUESTIONS
6. In light of the issues surrounding the
dismantling of US Navy vessels on Teesside, the phasing out of
single-hulled tankers, and the need to dispose of defunct UK naval
vessels, the Committee is undertaking aninquiry into the environmental
impacts of dismantling defunct ships in the United Kingdom, and
the methods of disposal to be used. In particular the Committee
will consider.
1. What facilities and expertise are already
in place in England and Wales to dismantle defunct ships safely?
7. The MCA are not aware of any facilities
in England and Wales with the full complement of licences required
to recycle defunct vessels. The MCA has received indications that
there may be limited capacity in Barrow, Merseyside, Humberside,
Plymouth and South Wales. At present, we understand that—irrespective
of its technical capabilities—AbleUK does not have the necessary
licences or planning permission for its Hartlepool facility.
2. What is the likely demand for such facilities
and what would be the likely economic and environmental impacts
of meeting such a demand?
8. Presently, the ships imported for recycling
in England (specifically the MARAD vessels) are special cases
where the owners have decided on more stringent conditions for
the recycling of their vessels, whilst not capitalising fully
on the scrap value.
9. Following both the Erika and Prestige
incidents, the IMO, through the MARPOL Convention, agreed to require
the phase-out of single-hull tankers between 2003 and 2015 (subsequently
reduced to 2010 with derogation through to 2015 for countries
outside the EU not wishing to apply the 2010 deadline). The total
number of single hull oil tankers worldwide, above 5,000 tons
deadweight, was estimated at 1,859 in 2003, with a total volume
of 126.3 million tons deadweight. It is estimated that, between
now and 2010, nearly 400 EU-flagged single-hull tankers (including
the new accession countries of Cyprus and Malta) will need to
address the EU drop dead date and whilst a significant number
will need to be recycled, it is probable that some will change
flag to make use of the derogation through to 2015. Single-hull
tankers are being phased out progressively between now and 2015
by reference to age and design. Newer tankers with semi-protection—ie
double bottoms or double sides—might be able to continue
until 2015 at the latest, subject to a rigorous structural survey
(Condition Assessment) at specified intervals, whereas, older
tankers with no additional protection will all have been phased
out by the end of 2005.
10. Lack of ship-recycling facilities that
can handle hazardous wastes or ship-decontamination facilities)
in OECD countries is a major problem for shipping and can cause
significant delay for owners wishing to recycle in the developed
world, resulting in significant associated financial costs (port
dues, maintenance and crewing costs).
11. This financial burden is increased if
the vessel is declared as "waste" because the ship cannot
carry on trading internationally once it has been classified as
such, it would need a valid transfrontier shipment of waste notification
to move across international borders. Therefore costs increase
whilst the owner waits for the last journey to be approved by
the export and import countries. Costs of up to £150,000
have been incurred by ships owners affected by such a scenario
in the UK. This could be a particular problem if a vessel was
detained on suspicion of going for recycling with owners accruing
costs whilst not being able to operate commercially and it was
subsequently demonstrated that the vessel was not for disposal.
12. Additionally there is a financial disincentive
for ships to be recycled in Western Europe as the steel in the
vessel is worth $10 a ton to the owner in North West Europe, and
has peaked at $390-410[5]
a ton in India and Bangladesh.
13. All of these economic pressures presently
provide a disincentive for ships to be recycled in the UK and
economically developed world.
3. What is the legal status of importing
such vessels for dismantling (the Committee will particularly
seek to clarify what are the implications for the industry of
the Stockholm Convention on Persistent Organic Pollutants)?
14. The legal status of an end of life ship
is very complicated due to the international nature of shipping
and disparity between conventions and guidelines forming the international
regulatory regime controlling ship-recycling. As such the MCA
and Defra are working together to implement the IMO Guidelines
and the EU Waste Shipment Regulation (which transposes the "Basel
Ban"[6])
as applicable. MCA and Defra are also working closely to find
a solution within the IMO and Basel Convention discussions. However,
each ship-recycling case in the UK raises its own problems due
to these conflicting and confusing requirements in the application
of the international control mechanisms and disjunctions in the
approaches taken globally.
UNCLOS, THE INTERNATIONAL
MARITIME ORGANISATION
AND GUIDELINES
ON SHIP-RECYCLING
15. Due to the global nature of the shipping
industry, ships often change flag and ownership over their lifetime.
As a result of UK Flag pressure to improve the ships on its Flag,
many companies are investing in new tonnage and environmentally
friendly technology and will sell on older ships as trading entities.
This sale can result in the vessel being re-flagged to another
flag state.
16. The Flag State concept is defined in
Article 91 of (UNCLOS):
"Every State shall fix the conditions
for the grant of its nationality to ships, for the registration
of its ships in its territory, and for the right to fly its flag.
Ships have the nationality of the State whose flag they are entitled
to fly. There must exist a genuine link between the State and
the ship."
17. UNCLOS then goes on to explain the duties
of the flag state (Article 94), which include ". . . jurisdiction
and control in administrative, technical and social matters over
ships flying its flag.", and that "Every state
shall take such measures for ships flying its flag as are necessary
to ensure safety at sea". It also states that "Such
measures shall include those necessary to ensure . . . that the
master, officers and, to the extent appropriate, the crew are
fully conversant with and required to observe the applicable international
regulations concerning the safety of life at sea, the prevention
of collisions, the prevention of marine pollution, and the maintenance
of communication by radio".
18. Therefore the Flag state has the responsibility
to ensure that a ship is trading safely and is not in contravention
of international regulations on safety and marine pollution, providing
a comprehensive and coherent legal regime and controls for that
ship, no matter where it is in the world. The Flag State concept
also reduces the possibility of different terrestrial legal regimes
being implemented for each State's waters and also covers the
ships on the high seas which are outside the jurisdiction of any
state.
19. Additionally UNCLOS sets down and gives
all ships specific rights, such as the right of innocent passage
through the territorial sea and freedom of navigation on the high
seas.
20. The IMO Guidelines on ship recycling
have been developed to give advice to all stakeholders in the
recycling process, including administrations of ship building
and maritime equipment supplying countries, flag, port and recycling
States, as well as intergovernmental organisations and commercial
bodies such as ship owners, ship builders, repairers and recycling
yards. The IMO Guidelines on recycling of ships focus on numerous
issues and provides guidance on:
— the identification of hazardous substances
in a ship—based on the inventory and lists found in the
Industry Code of Practise and the annexes of the Basel Convention;
— the introduction of the concept of
a Green Passport for both new ships and existing ships—which
contains an inventory of materials hazardous to human health or
the environment that would accompany a ship throughout its working
life;
— the minimisation of hazardous substances
used in the construction of new ships, or maintenance of existing
ships, and their equipment;
— the design of ships equipment to
facilitate recycling and the removal of hazardous materials during,
or at the end of a ships lifecycle;
— the establishment and maintenance
of an Inventory of Hazardous Materials and other materials that
are of concern for recycling operations;
— the preparation of ships for recycling
and the establishment of "ready for recycling" conditions;
and
— clarification of ownership issues
and the roles and responsibilities of Flag States, Transit States,
Recycling States, the Shipping Industry, Ship brokers, intermediate
buyers and the ship recycling industry.
21. In this guidance the main roles and
responsibilities of the Flag States[7]
are to:
— encourage the widespread use of the
IMO Guidelines;
— to establish criteria to declare
a ship "ready for recycling". The basic criteria would
be the completion of the work to prepare a ship for recycling,
set out in section 8 of the Guidelines;
— urge the use of a ship recycling
sales contract (such as the BIMCO—Baltic and International
Marine Council—Demolition Contract) to take account of all
relevant environmental, health and safety considerations; and
— co-operate with recycling states
to facilitate the implementation of the guidelines.
22. The guidelines also focus on the roles
and responsibilities of the port state and the recycling state:
Main roles of the port State[8]
— the port State assumes a role in
verifying compliance with international maritime conventions by
the inspection of foreign ships in national ports to check that
the condition of the ship and its equipment comply with the requirements
of international regulations and that the ship is manned and operated
in compliance with these rules;
— co-ordination between the port State
and the flag State is encouraged to ensure the ship meets all
relevant IMO requirements, and any other applicable requirements,
at all times;
— promotion of the widespread use of
IMO guidelines within the industry; and
— co-operate with flag States and recycling
States to facilitate implementation of the guidelines.
Main roles of the recycling State[9]
— to enforce international obligations
and national legislation in respect of worker safety, health and
welfare and the protection of the environment in the ship recycling
industry, in particular, with respect to hazardous and other wastes
handled at a recycling site;
— to introduce national regulations
in relation to the condition of ships purchased for recycling
both at the time of purchase and at the time of delivery. In effect,
the recycling State should lay down any conditions it considers
necessary before a ship is accepted for recycling;
— to establish/maintain adequate reception
facilities for ship-generated waste from ship recycling operations;
— to introduce and enforce legislation
which requires that all ships being recycled have a gas-free certificate
or hot work safe certification as applicable, issued by a relevant
and appropriate body, for enclosed spaces onboard ship;
— to introduce, implement and enforce
sound legislation and other requirements concerning the recycling
of ships, including measures to authorising or licensing recycling
facilities. To this end, recycling states should examine, and
where necessary adopt national legislation or requirements, any
applicable internationally developed conventions, recommendations
and guidelines relevant to the ship recycling industry such as
those Guidelines and those produced by the International Labour
Organisation (ILO) and the Basel Convention;
— to establish routines for the control
of ships delivered for recycling; and
— to introduce, implement and enforce
sound legislation concerning the recycling of ships.
23. Guidance is also given to the Shipping
Industry, brokers and intermediate buyers and the ship recycling
industry. The voluntary nature of these guidelines may be reviewed
in the future, depending on the international experience and adherence
to them by the industry.
BASEL CONVENTION
24. Under the Basel Convention, the State
of Export is required to notify any proposed transboundary shipment
of waste, or to require the generator or exporter to notify it.
The EU Waste Shipment Regulation places this responsibility on
the waste producer who would generally be expected to notify the
shipment (in this case the movement of the ship itself). This
has led to confusion within the shipping industry and in individual
governments on how the international system controlling ships
being recycled should be applied. There is an ongoing international
debate as to whether the controls of the Basel Convention can
be applied to ships and how they interact with the specific rights
laid down in UNCLOS.
25. A major difficulty lies with the difference
in the perceived roles and responsibilities of the state, with
the IMO Guidelines (as in all shipping related legislation) being
applied through the state only to the state's flagged ships[10]
whilst the Basel Convention would apply to the exporting state—in
this case to vessels leaving UK ports regardless of flag or state
of ownership. This raises potential conflicts with commitments
under UNCLOS and the rights of shipping—the right of innocent
passage through the territorial seas and freedom of navigation
on the high seas.
26. In order to identify and overcome the
overlaps between the IMO, the Basel Convention and the International
Labour Organisation (which has focused on the Health and Safety
Standards in Ship-recycling yards), a Joint Working Group is being
set up. The UK hopes to be actively involved in the work of this
group. The Terms of Reference for this Joint Working Group can
be found in Annex 1.
27. The Basel Convention has circulated
a paper to stimulate analysis of some of the legal uncertainties
related to ship recycling. The UK intends to submit its position
in the coming weeks. A copy will be forwarded to the Committee.
28. The present control complexities and
confusions, combined with the commercial disincentives could also
affect the numbers of ships brought to the UK for recycling should
there be an appropriate facility. The MCA are very concerned that
the terrestrial application of the Basel Convention, "Ban"
amendment and the EU Shipment of Waste Regulations (WSR) which
transpose the Basel Ban could:
— be an incentive to reflag older ships
away from the UK flag in order to facilitate scrapping. As the
UK is trying to maintain and improve safety and environmental
standards and promote sustainable development within the industry,
such an incentive needs to be addressed;
— be a disincentive to scrap ships
in an environmentally sound and sustainable manner in the developed
world due to the economic consequences for the owner from delays
due to the Basel Controls, Basel Ban amendment and WSR controls
on a ship as waste (as highlighted above) and the lack of a strong
market for scrap steel in much of the developed world;
— increase the threat of possible litigation
and damage claims for undue delay or illegal detention under UNCLOS;
— be a significant disincentive for
the industry to recycle older ships and invest in new tonnage
(as the financial returns for scrapping old vessels will be negligible);
— cause significant costs for vessel
owners when ships are laid up awaiting the necessary transfrontier
shipment of waste permissions to fulfil the European transposition
of the Basel Convention; and,
— result in UK flagged and owned ships
being turned away from environmentally sound recycling yards due
to the different interpretations of the international legislation
and guidance.
29. Additionally there has been the threat
of abandonment of ships following potential detentions under transfrontier
shipment of waste controls in UK ports. This a serious concern
as already seen in the cases in Belgium (the SILVER RAY) and the
Netherlands (the SANDRIEN) and could lead to significant court
and crew repatriation costs for the UK Government, as well as
substantial disposal costs if the UK is forced to recycle the
vessel itself as the "export state" under the Basel
Convention. There is a related concern with the Basel requirements
for incomplete or unlicensed shipments to be repatriated to the
export state. If this was applied a vessel leaving from a UK port
and then proceeding directly for recycling could, if rejected
by the recycling state, be seen as an unlicensed UK export that
would have to be returned to the UK for disposal regardless of
flag or ownership.
4. How defunct United Kingdom vessels are
currently dealt with, and what plans have been made to cope with
their disposal?
30. Here, the term "United Kingdom
vessels" needs to be clarified. Does this mean UK Government
owned vessels, UK Flagged ships or UK owned (but not necessarily
UK flagged) ships? This clarification is needed as each is controlled
in different ways.
31. At the present moment the UK has a policy
in which the MCA and Defra are promoting both the IMO Guidelines
and the Basel Convention conditions, however each case brings
its own problems, due to the confusion in the international control
mechanism, conflicting international conventions and global disincentives.
The MCA and Defra are liaising closely to work towards ensuring
that all ships permanently in UK waters, being imported to the
UK or being exported from the UK, are recycled in a sustainable
manner with appropriate environmental, health and safety controls.
CONCLUSIONS
32. The UK is working within the international
community to clarify the international control mechanisms for
end of life vessels. However, at the present time, if a ship-recycling
industry is developed then its viability will be affected by developing
international controls and economic complexities. Therefore before
a decision can be made to develop an industry in the UK, the findings
of the Joint Working Group on Ship-recycling should be known.
In addition, the following questions may need to be considered:
How can the international regime for controlling
ship-recycling be developed to reflect sustainable development?
As ship recycling is a major source of steel for parts of the
developing world is it sustainable for the developed world to
use restrictive environmental legislation to affect a component
of the developing world's economic and industrial capacity? Should
a strategy be considered internationally that provides for robust
environmental and health and safety standards but allows those
yards who fulfill these requirements to compete in an open, global
market?
33. One option which could be considered
would be to provide investment to bring developing world recycling
yards and disposal standards up to acceptable environmental and
health/safety standards. Capacity building and technology transfer
are recognised principles within the international sphere and
there is a need to improve standards within the non-OECD states
in view of the increasing fleets on their registers. Acting to
restrict the scrapping of OECD or European ships, or detaining
foreign-flagged ships in port will only address a section of the
ships going for scrap and is likely to have significant negative
implications.
Maritime and Coastguard Agency
June 2004
Annex 1
DRAFT TERMS OF REFERENCE OF THE JOINT ILO/IMO/BASEL
CONVENTION WORKING GROUP
The Joint ILO/IMO/Basel Convention Working Group
should:
.1 consider the respective work programmes
of the pertinent bodies of ILO, IMO and the Conference of Parties
to the Basel Convention on the issue of ship scrapping* in order
to avoid duplication of work and overlapping of roles, responsibilities
and competencies between the three Organisations, and identify
further needs;
.2 facilitate the exchange of views between
the three Organisations in order to ensure a co-ordinated approach
to all the relevant aspects of ship scrapping;
.3 undertake a comprehensive initial examination
of the:
(1) Technical Guidelines for the Environmentally
Sound Management of the Full and Partial Dismantling of Ships,
adopted by the Sixth Meeting of the Conference of Parties
to the Basel Convention;
(2) IMO Guidelines on Ship Recycling,
adopted by resolution A.962(23); and
(3) Safety and Health in Shipbreaking:
Guidelines for Asian countries and Turkey, developed by ILO,
with a view to identifying any possible gap,
overlap, or ambiguities;
.4 consider mechanisms to jointly promote
the implementation of the relevant Guidelines on Ship Scrapping;
.5 monitor progress of any jointly organised
technical co-operation activities; and
.6 submit its reports, recommendations and
any other relevant information on the above or other pertinent
matters to bodies of IMO, ILO and the Basel Convention, as appropriate.
Maritime and Coastguard Agency
June 2004
4 Assembly decision A.962(23) November 2003. Back
5
Reported market rates May 2004. Back
6
The "Basel Ban" amendment calls upon OECD countries
and other developed states to prohibit the export of hazardous
waste to non-OECD countries regardless of whether they are destined
for disposal or recycling/recovery. The "ban" is not
yet effect in its own right but is implemented in the EU through
the Waste Shipment Regulation. In the context of ships the presence
of non-recoverable hazardous wastes such as PCB's would prohibit
the "export" of end-of-life ships to such countries
despite the vast majority of a vessel being recyclable. Back
7
Section 9.2 of the IMO Guidelines. Back
8
Section 9.3 of the IMO Guidelines. Back
9
Section 9.4 of the IMO Guidelines. Back
10
Historically, due to the international nature of the shipping
industry, ships have been controlled through the Flag State and
not the Terrestrial state. In that way no matter where the vessel
is in the world they are still controlled by one international
legal regime and the guidelines as stipulated and formulated at
the IMO. Back
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