9th January 2021 – 15th January 2021
LOCAL NEWS
1. European Union Emissions Trading System for Shipping (EU ETS)
On 16th September 2020, the EU Parliament, putting aside the Shipowners' orchestrated strong opposition, by a strong 70% majority voted for the inclusion of Shipping in the EU ETS.
The implementation of this new scheme is 1st January 2022.
Its main objective is to establish a "Green Fund" for Research and Development to promote innovative technologies and infrastructure to decarbonise the maritime transport sector.
The Commission initiated a Public Consultation with Stakeholders in November 2020, in order to discuss the optimum way of implementing ETS. On December 7th 2020, the Cypriot Ministry of Shipping in coordination with our Union invited the EU decision makers (Deputy Director of DG KLIMA) along with NGO’s and Shipowners to discuss ETS over a live debate.
In the circumstances where the ETS is adopted irreversibly by the EU, the President of our Union, A. Hadjiyiannis, aimed at shifting the burden of payment of the ETS allowances from the Shipowner to the cargo transporter.
The Union's President took the opportunity to highlight to Ms. Clara de la Torre, Deputy Director-General of Directorate General for Climate Action (DG CLIMA), European Commission and Ms. Magdalena Adamowicz, MEP, Member of the Committee on Transport and Tourism, European Parliament the fact that after spending billions of Euros to reduce the SOX through the fitting of scrubbers there is little the ship (on today's technology and available means of energy) can do to reduce further the CO2 Emissions. This can only be done by the optimisation of sea trade.
Mr. Hadjiyiannis went to the length of putting forward a detailed analysis showing that the ETS is only meaningful if it is directed to the cargo transporter. Ms De la Torre, appreciated the merits of the argument and requested a more detailed analysis of the proposal. In this respect CUS President prepared and sent the attached report.
The proposal's final outcome is twofold. Firstly, it proves that in order for any ETS to be efficient, it should be addressed to the decision maker which is the Transporter and not the Shipowner. Secondly, the ETS should incentivise the Transporters to organise their Logistics to allow necessary margins, among other measures, for the vessel to proceed at the optimum speed in order to reduce the GHG emissions related to the transportation of their cargo.
Ms De la Torre already responded officially to the CUS President, on Tuesday 12 January acknowledging that the proposal is of significant potential and EU will be looking at very carefully during the drafting of the EU ETS.
The Union will closely monitor this matter and keep the Members updated with the developments of this hot issue.
Related Article:
Attachment 1: EU ETS - The proposal
2. Urgent Provisional Measures for the operation of Cyprus ships during the Covid-19
Due to the fact that the coronavirus outbreak still constitutes a public health emergency that prevents the normal operation of recognised training schools and assessment centres, certificates of competency, certificates of proficiency and documentary evidences issued by the Republic of Cyprus with expiration date between 01/03/2020 and 29/06/2021shall be considered valid until 30/06/2021.
Circular No. 1/2021 must be placed on board vessels flying the Cyprus flag.
Please do not hesitate to contact the Shipping Deputy Ministry, for any further information you may require.
Related Article:
Shipping Deputy Ministry - Circular No. 1/2021
INTERNATIONAL NEWS
3. ‘Sudden change’ as shipowners respond to charterers and regulators call for greener ships
There are strong indications that recent regulatory and commercial pressures are starting to heavily influence the investment decisions of shipowners toward more environmentally friendly ships. A key turning point was the International Maritime Organization’s (IMO) decisions late last year to mandate the EEXI, a minimum Energy Efficiency Standard for Existing ships, and the Carbon Intensity Indicator (CII), an environmental rating system for in-service operational performance. These regulations will enter into force from 2022.
The IMO measures add to moves in the commercial market such as that of RightShip’s Greenhouse Gas (GHG) rating, and the leading charterers' Sea Cargo Charter initiative to measure the operational performance of vessels under hire. The result of these initiatives is that from 2022 ships will be closely scrutinised and rated from both regulators and commercial operators for their environmental performance.
In the dry bulk market some owners are responding by ordering ships with efficiency standards that are ahead of the regulatory requirement of the Energy Efficiency Design Index (EEDI). Currently, newbuildings only have to comply with Phase 2 of the EEDI standard. The Phase 3 standard is not mandatory until 2025.
In the containership market, a broker reported that the vessels with the highest environmental performance rating will be the most marketable and will achieve the best rates in the future. The same applies to its asset values too.
However, not only newbuilding market activity is starting to pick up. More than 3,500 units have been sold worldwide and the propeller unit can be retrofitted to existing ships at port during port stops or fitted on newbuildings.
Related Article:
Attachment 2: TradeWinds 15/1 - ‘Sudden change’ as shipowners respond to charterers and regulators call for greener ships
4. UK Maritime and Coast Guard Agency issues Ballast Water Management FAQs (Jan. 2021)
The UK Maritime and Coast Guard Agency (MCA) has published an updated document containing Frequently Asked Questions on the subject of Ballast Water Management.
The document addresses questions on topics such as application of regulation to different types of ships, domestic or international, Survey and Certification Requirements, Ballast Water Exchange (BWE) requirements, Ballast Water Treatment Systems (BWTS), Alternatives to meeting the D1 or D2 Standards, handling sediments, and more.
Related Article:
5. MPA Singapore announces new holding areas for crew change
As part of a series of measures to control the spread of COVID-19, MPA Singapore announced new holding areas to facilitate crew changes, with effect as of 13 January 2021.
According to BIMCO, this measure aims to enable safe continuation of crew changes and follows other measures announced this week.
With effect from 11 January, MPA has implemented sea launch transfer for enhanced crew change procedures.
MPA, together with relevant agencies, tested some 27,000 shore-based personnel in a one-time sweep between 2 and 8 January 2021 following two COVID-19 cases in late December 2020.
Related Articles:
Infomarine 15/1 - MPA Singapore: SafeEntry@Sea protocols take effect
Safety4Sea 14/1 - MPA Singapore announces new holding areas for crew change
6. US TREASURY REPORT
- On the 8th January 2021, OFAC has updated its Non-SDN Communist Chinese Military Companies List.
https://www.treasury.gov/ofac/downloads/ccmc/ns-ccmc_list.csv
https://www.treasury.gov/ofac/downloads/ccmc/ns-ccmc_list.pdf
Furthermore, the OFAC SDN List has been updated with the Global Magnitsky Designation of the following individual:
https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20210108
- On the 8th January 2021, OFAC announced the issuance of General License 1, "Authorizing Transactions Involving Securities of Certain Communist Chinese Military Companies", authorizing through 9:30 a.m. eastern standard time, January 28, 2021, all transactions and activities prohibited by section 1(a)(i) of Executive Order (E.O.) 13959 involving publicly traded securities, or any securities that are derivative of, or are designed to provide investment exposure to such securities, of an entity whose name closely matches the name of a Communist Chinese military company identified in the Annex to E.O. 13959 but that has not been listed on the Office of Foreign Assets Control’s Non-SDN Communist Chinese Military Companies List.
https://home.treasury.gov/system/files/126/chinese_military_gl1.pdf
- On the 11th January 2021, the OFAC SDN List has been updated with the designations of the following individuals and entities for Foreign Interference in the U.S. Elections.
https://home.treasury.gov/news/press-releases/sm1232
- On the 12th January 2021, the OFAC SDN List has been updated with the Counter Terrorism Designations of the following individuals.
https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20210112
OFAC has not issued a related Press Release.
- On the 13th January 2021, the OFAC SDN List has been updated with the Iran – related Designations of the following individuals and entities.
It should be noted that the above designations are subject to Secondary Sanctions.
These persons are being designated pursuant to Executive Order (E.O.) 13876, which targets the Supreme Leader of the Islamic Republic of Iran and the Iranian Supreme Leader’s Office (SLO), as well as their affiliates.
This action follows Treasury’s November 2020 designation of the Bonyad Mostazafan, an immense conglomerate with holdings in key sectors of Iran’s economy. As with EIKO and AQR, Bonyad Mostazafan has been the beneficiary of favorable treatment by Iran’s corrupt leadership, and its assets have been used by the Supreme Leader Ali Khamenei to enrich his office, reward his political allies, and persecute the regime’s perceived enemies.
EIKO is a business juggernaut under the direct supervision of Supreme Leader Ali Khamenei that has a stake in nearly every sector of the Iranian economy, including energy, telecommunications, and financial services.
According to OFAC, persons that engage in certain transactions with the individuals or entities designated by OFAC may themselves be exposed to sanctions. Furthermore, any foreign financial institution that knowingly facilitates a significant transaction or provides significant financial services for any of the persons designated today could be subject to U.S. correspondent account or payable-through account sanctions.
https://home.treasury.gov/news/press-releases/sm1234
Furthermore, the OFAC SDN List has been updated with the Counter Terrorism Designation of the following individual:
- On the 13th January 2021, changes have been made to OFAC's SDN List.
https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20210113_33
- On the 14th January 2021, the OFAC SDN List has been updated with the Specially Designated Nationals And Blocked Persons List (SDN) Human Readable Lists.
https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20210114
- On the 14th January 2021, OFAC announced a $1,016,000 settlement with PT Bukit Muria Jaya (“BMJ”).
BMJ, a paper products manufacturer located in Indonesia, has agreed to settle its potential civil liability for 28 apparent violations of the North Korea Sanctions Regulations, 31 C.F.R. part 510.
Specifically, BMJ directed payments related to its exportation of cigarette paper to the DPRK and a blocked person to its U.S. dollar bank account at a non-U.S. bank, which caused U.S. banks to clear wire transfers related to these exports between March 2016 and May 2018.
OFAC determined that BMJ did not voluntarily self-disclose these apparent violations, and that these apparent violations constitute a non-egregious case.
https://home.treasury.gov/system/files/126/20210114_BMJ.pdf
- On the 14th January 2021, OFAC announced the issuance of General License No. 2, "Authorizing Securities Exchanges Operated by U.S. Persons to Engage in Transactions Involving Securities of Communist Chinese Military Companies".
https://home.treasury.gov/system/files/126/chinese_military_gl2_1.pdf
- On the 15th January 2021, OFAC announced the issuance of GENERAL LICENSE NO. 2, "Authorizing Securities Exchanges Operated by U.S. Persons to Engage in Transactions Involving Securities of Communist Chinese Military Companies".
https://home.treasury.gov/system/files/126/chinese_military_gl2_1.pdf
OFAC has also announced the publication of new (871, 872, 873, 874) frequently asked questions related to the "Executive Order on Amending Executive Order 13959 - Authorizing Securities Exchanges Operated by U.S. Persons to Engage in Transactions Involving Securities of Communist Chinese Military Companies".
FAQ 871 states that all transactions and activities by securities exchanges operated by U.S. persons prohibited by section 1(a)(ii) of Executive Order (E.O.) 13959, as amended by the E.O. of January 13, 2021, involving publicly traded securities, or any securities that are derivative of, or are designed to provide investment exposure to such securities, of any entity that is listed on the Office of Foreign Assets Control’s Non-SDN Communist Chinese Military Companies List (NS-CCMC List) after 12:01 a.m. eastern standard time, January 14, 2021, are authorized through 12:01 a.m. eastern time on the date that is 365 days after the date the entity is listed on the NS-CCMC List.
https://home.treasury.gov/policy-issues/financial-sanctions/faqs/871
FAQ 872 states that E.O. 13959 require United States persons to divest their holdings of publicly traded securities, or any securities that are derivative of, or are designed to provide investment exposure to, such securities of Communist Chinese military companies.
https://home.treasury.gov/policy-issues/financial-sanctions/faqs/872
FAQ 873 states that E.O. 13959 defines the term “transaction” as the purchase for value, or sale, of any publicly traded security.
https://home.treasury.gov/policy-issues/financial-sanctions/faqs/873
FAQ 874 states that any transaction (including purchases for value and sales) entered into on or before 11:59 p.m. eastern standard time on November 11, 2021, solely to divest, in whole or in part, from securities that any United States person held as of 9:30 a.m. eastern standard time on January 11, 2021, in a Communist Chinese military company as defined in section 4(a)(i) of E.O. 13959, is permitted.
Similarly, for a person determined to be a Communist Chinese military company.
https://home.treasury.gov/policy-issues/financial-sanctions/faqs/874
- OFAC SDN List Update: Hong Kong-related Designations; Iran-related Designations and Designations Updates; Global Magnitsky Designations; Counter Terrorism Designation Update; Non-Proliferation Designations Updates
On the 15th January 2021, the OFAC SDN List has been updated the Specially Designated Nationals (SDN) and Blocked Persons list with following individuals and entities:
https://home.treasury.gov/policy-issues/financial-sanctions/recent-actions/20210115
- On the 15th January 2021, OFAC issued regulations to implement Executive Order 13936 of July 14, 2020, "The President's Executive Order on Hong Kong Normalization." These regulations were published in the Federal Register, and take effect, today. OFAC intends to supplement this part 585 with a more comprehensive set of regulations, which may include additional interpretive and definitional guidance and additional general licenses and statements of licensing policy.
https://home.treasury.gov/system/files/126/fr86_3793.pdf
Related Articles:
Attachment 3: A full detailed US TREASURY REPORT
Attachment 4: TradeWinds 15/1 - IRISL hit with more sanctions, chief executive blacklisted
7. PIRACY REPORT
- IMB: Gulf of Guinea records highest ever number of crew kidnappings in 2020
The International Chamber of Commerce’s International Maritime Bureau (IMB) issued its annual report concerning international piracy incidents, highlighting that the Gulf of Guinea is a hot spot for piracy incidents and remains a crucial challenge for seafarers.
The increased piracy incidents in the latest report of the Gulf of Guinea were a topic of discussion in the International Chamber of Commerce’s International Maritime Bureau (IMB), that was published in October 2020, which highlighted a 40% increase in the number of kidnappings. Yet, the annual report sets the Gulf of Guinea in the spotlight.
Related Articles:
Attachment 5: TradeWinds 14/1 - IMB calls for action as West African kidnappings hit all-time high
Safety4Sea 14/1 - IMB: Gulf of Guinea records highest ever number of crew kidnappings in 2020
Maritime Executive 13/1 - IMB: Gulf of Guinea Attacks Drive Increase in Global Piracy Numbers
Safety4Sea 12/1 - 97 incidents of piracy reported in Gulf of Guinea during 2020
- On 13 January, a Singaporean-flagged container ship has been reportedly approached by a small vessel, southwest of Bonny, Nigeria, in the Gulf of Guinea. The crew mustered in the citadel. The vessel left and the crew and vessel are safe.
Safety4Sea 14/1 - A container ship approached by small vessel in Gulf of Guinea
ShippingWatch 14/1 - A ship attempted boarded by pirates in Gulf of Guinea
- On 9 January, five unauthorised persons boarded a container vessel while it was drifting southwest of Cartagena. The crew locked themselves in the accommodation block. The Colombian Navy was informed and an investigation was followed. The five perpetrators were rumoured to be stowaways.
VesselTracker 12/1 - Container Ship Boarded By Perpetrators
- On 8 January, it was reported that four crew members who were kidnapped from a Marshall Islands-flagged product tanker on 29 November 2021, had been released.
VesselTracker 13/1 - Four Kidnapped Crew Members Free
- On 8 January, a skiff with eight persons onboard approached a bulk carrier while underway south of Brass. Due to master's maneuvers, the skiff aborted the approach. The crew is reported to be safe.
- No other incidents to report.
Related Articles:
Attachment 6: Weekly Piracy report as received by the US Navy Military
Attachment 7: TradeWinds 15/1 - Two bulkers report suspicious approaches in Gulf of Aden
Nothing important to report from ECSA, IMO, ILO and Parliament of Representatives.