1st March 2025 – 7th March 2025
LOCAL NEWS
No news reported.
INTERNATIONAL NEWS
1. US President Draft Executive Order – To Make Shipbuilding Great Again
With respect to the Draft Executive Order (EO) issued by the US President, on 27 February 2025, kindly see below a summary prepared.
In general, the Executive Order outlines a Maritime Action Plan (MAP) to be developed and submitted to the President within 180 days since the issuance of this E.O.
Purpose:
The purpose of the EO is to revitalize the U.S. shipbuilding and maritime industries to reinforce national security, economic prosperity and global maritime leadership.
Tab B of the attachment includes the Draft EO and mandates a comprehensive strategy to restore the U.S. maritime industrial base and workforce competitiveness.
Key Measures:
- Ensure the Security and Resilience of the Maritime Industrial Base – The Department of Defense (DoD) and the Department of Transportation (DOT) within 180 days will utilize Defense Production Act authorities to expand shipbuilding, repair, and port infrastructure.
- Address People’s Republic of China's (PRC) Unfair Trade Practices – The U.S. Trade Representative (USTR) will impose:
- tonnage based fees on PRC built or flagged vessels dock in the US Ports;
- tariffs on port cargo handling equipment manufactured, assembled or made using PRC origin components or manufactured anywhere in the world by a company owned or controlled by a Chinese person and;
- fees on any vessel that enters a US Port if that vessel is part of a fleet that includes vessels built or flagged in the PRCand Chinese-manufactured port equipment.
- Enforce Harbor Maintenance Tax (HMT) – Stricter enforcement on imported goods to prevent avoidance of U.S. port entry fees via Canada and Mexico. Customs, fees, taxes, tariffs, interest and a 10% service fee will be applicable. The tax is 0.125% of the value of the cargo.
- Investigate National Security Risks – The Department of Commerce within 90 days will launch a Section 232 investigation into foreign influence in U.S. maritime industries.
- Engage Allies to Counter PRC Policies – The Secretary of State will engage with U.S. allies to align maritime trade policies and counter PRC unfair practices.
- Establish a Maritime Security Trust Fund – Within 90 days a legislative proposal shall be submitted to the Congress for the establishment of a new financial mechanism funded by tariffs/taxes to support shipbuilding and maritime programs.
- Create a Shipbuilding Financial Incentives Program – Within 90 days a legislative proposal shall be submitted to the Congress, for the establishment of a financial incentives program to invest in capitalisation and construction of commercial vessels, shipyards and ship repair facilities through grants, loans, or other financial instruments.
- Enhance Nuclear Shipyard Productivity – Within 60 days the Secretary of Defence shall modify the contracts of nuclear ship construction projects to fund annualised service and support cost for shipbuilder wages, infrastructure, critical materials and transportation.
- Develop Maritime Prosperity Zones – Within 90 days deliver a plan to the President that identifies opportunities to incentivize and facilitate domestic and allied investment in U.S. maritime industries and waterfront communities through establishment of maritime prosperity zones.
- Increase Demand for U.S. Shipping – Within 90 days to be delivered to the President a Plan to incentivize U.S.-flagged vessels, including tax relief and cargo preference programs.
- Expand Mariner Training and Education – Within 90 days to deliver a recommendations’ report to the President, on the strengthening merchant marine academies, credentialing reforms, and scholarship programs.
- Improve Procurement Efficiency – Reforming vessel acquisition processes to reduce costs, delays, and bureaucratic inefficiencies.
- Enhance Government Efficiency – A review of DoD and DHS procurement processes.
- Establish a Strategic Commercial Fleet Program – Within 60 days to deliver a legislative proposal to Congress for a U.S.-built and flagged fleet to support national security needs.
- Invest in Critical Maritime Infrastructure Abroad – Within 60 days to deliver a plan to the President to invest in maritime infrastructure abroad to secure U.S. access to critical global supply chains and markets.
- Secure Arctic Waterways – Within 90 days to develop a defence strategy to safeguard U.S. interests in the Arctic region.
- Conduct a Shipbuilding Industry Review – Within 45 days to conduct a shipbuilding review and submit a report on increasing competition and cost efficiency within U.S. shipbuilding.
In particular:
- The EO mandates interagency collaboration, with specific deadlines for plans and reports;
- The National Security Council will oversee the alignment of maritime policies;
- Legislative proposals and budget allocations will be submitted to Congress as necessary;
- The EO does not override existing laws but seeks to enhance maritime policies within legal constraints;
- It does not establish new rights enforceable against the U.S. government.
In line with the Position Paper issued, this EO provides a comprehensive strategy for addressing trade imbalances, securing critical maritime resources, and strengthening global leadership.
We will continue to monitor this matter closely.
Related Articles:
Attachment 1: USTR 27/02 - Draft Executive Order
Attachment 2:US toughens stance on China-linked port fees
Safety4Sea 04/03 - US port fees on Chinese-built vessels raise concerns
2. European Community Shipowners’ Associations (ECSA) rebrands as European Shipowners
On Wednesday, 5 March 2025 and on the occasion of its 60 years, the European Community Shipowners’ Associations (ECSA) renamed to ECSA European Shipowners, reinforcing its role as the voice of the European shipping industry.
On the same date, the organisation launched a new logo and visual identity, which represents 22 European shipowners’ national associations, around 35% of the global fleet and all shipping segments from bulker carriers to container ships, tankers, gas carriers, ferries, cruise ships and offshore vessels.
The new name reflects the organisation’s commitment to raising awareness of European shipping’s key role to our continent’s energy, supply chain and food security.
As the industry navigates the immense challenge of the energy transition, the organisation’s new identity aims to make its mission clearer to policymakers and the public.
Related Article:
ECSA 05/03 - European Community Shipowners’ Associations (ECSA) rebrands as European Shipowners
3. BIMCO FuelEU Maritime Clause: Key considerations for owners and charterers
BIMCO has recently published the BIMCO FuelEU Maritime Clause for Time Charter Parties 2024. Please see below a summary (prepared by BIMCO) of the key elements of this clause that require detailed consideration:
Understanding the clause's approach to biofuels
One of the key aspects of the BIMCO clause is its approach to biofuels. Unlike some interpretations suggest, the clause does not grant charterers the automatic right to supply biofuels or other alternative fuels. Instead, it expressly stipulates an option for charterers to provide compliant fuels, provided these fuels are explicitly listed as acceptable in the charter party's bunker clauses. This distinction is important, as it requires parties to engage in negotiations upfront, considering the vessel's specific features, trading area and the diverse properties of different fuel types.
Oversupply as a cash-back strategy
A concern raised in relation to the BIMCO clause is that charterers might use the clause by oversupplying biofuels or other alternative fuels, expecting compensation for such supply. However, the clause contains clear safeguards to prevent such scenarios. Specifically, reimbursement to the charterers pursuant to the clause requires that the charterer has already paid a surcharge to the owners, and it is limited to instances where a negative compliance balance is reduced or eliminated, i.e. up to zero and not above.
Pooling and compliance balance: Timing is key
The clause also introduces a pooling mechanism for charterers, enabling them to pool positive and negative compliance balances if the vessel is chartered for an entire reporting period, from January 1 to December 31. This provision underscores the importance of strategic timing, particularly concerning delivery and redelivery schedules, as well as the charter period's duration.
Settlement mechanism for compliance balances
Another area where the BIMCO clause demonstrates flexibility is in the settlement of compliance balances. Although the novelty of the FuelEU Regulation and associated indexes expected to emerge for pricing compliance balances, the clause allows parties to agree on a settlement mechanism under optional subclause (m). This provision is particularly useful when parties wish to specify a currency and amount, facilitating a customised commercial agreement.
Navigating the complexities of the FuelEU Multiplier
One of the more complex aspects of the FuelEU Maritime Regulation is the FuelEU Multiplier, which can significantly impact new charterers. The multiplier increases the FuelEU penalty by 10% for each consecutive year of non-compliance. The multiplier is therefore an aspect of importance and charterers are strongly encouraged to conduct a thorough due diligence on a vessel's compliance history before entering into a charter agreement. Charterers need to be fully aware of the vessel's past compliance records to strategically plan their approach, avoiding unexpected costs linked to the FuelEU multiplier.
Please tab the link below for the full article.
Related Article:
BIMCO 28/02 - BIMCO FuelEU Maritime Clause: Key considerations for owners and charterers
4. US TREASURY REPORT
The US Treasury Report for all actions reported is hereby attached.
Related Article:
Attachment 3: US Treasury Report for week 22/02/2025 – 28/02/2025
5. PIRACY REPORT
The Piracy Report for all actions reported is hereby attached.
Related Article:
Attachment 4:Worldwide Threat to Shipping (WTS) Report, for the period between 05/02/2025 – 05/03/2025
Nothing important to report from Local News, the IMO and the ILO.