New rules affecting shipping often come into effect at the turn of the year and from 1 January 2018 the major change for ships above 5,000gt will be the requirement to comply with the EU’s Monitoring, Reporting and Verification (MRV) regulations.

MRV is the regulator’s response to the accusation that shipping is not doing enough to reduce its CO2 emissions. Quite clearly putting a lower limit of 5,000gt on the regulation will exclude huge numbers of ships, but those that are covered are considered to be responsible for around 90% of CO2 emissions from ships.

Under MRV rules, ships will be required to monitor the CO2 emissions from ships, make an annual report of those emissions to an approved third party verifier and for the verified reports to be submitted to appropriate authorities where they will be aggregated. The information gathered will then be used to determine future efficiency regulation and also very likely to be used as grounds for including shipping into some market-based measure that will raise money to supposedly offset the effect of those emissions.

There are two MRV regimes that will be operating. The first of these to come into effect is an EU regime with the IMO’s own similar but not identical regulation coming into effect later in 2018. The EU regime applies only to ships planning to make calls to ports in the EEA – effectively any EU member state plus Iceland and Norway. The governing rules are laid out in Regulation (EU) 2015/757 which is supplemented by Regulation (EU) 2016/2072 (accreditation and appointment of verifiers) and Regulation (EU) 2016/1927 (requirement for monitoring plans).
It is important to read all of the regulations together because shipowners need to follow designated pathways to making reports and must have a documented plan in place that will need to be followed. The January 2018 date is in fact the second of two deadlines in the EU regulation as the requirement for an approved plan for the company to be in place was back in August 2017.

EU and EEA shipowners will have been made aware of the requirements by flag states but for ships registered in other countries the owners may have been unaware of the exact requirements especially the fact that the verifier must have been approved by one of the member states of the EEA. The fact that one of the deadlines has already passed is not a huge obstacle as under Article 6.2 of the EU rules, the owner will have two months from the date of any affected ships first port call to put all requirements in place. For any owner still lagging in implementing the requirements, the 2016/1927 Regulations which can be downloaded from a number of sources includes a very useful plan template.

Gathering facts

Although there may be some grace period for ships which do not yet have a reporting plan in place, it will be important that they at least understand the requirements so that appropriate records and documentation can be kept. For each ship this will include fuel consumption and other parameters, such as distance, time at sea and quantity of cargo carried. The quantity of cargo carried is included because the EU ETS (Emission Trading System) that the owners may have to participate in is about the amount of work done by cargo and distance which is in contrast to the IMO’s simpler variant which just records distance.

The monitoring plan is required to describe the vessel and its installed combustion machinery, and provide information in a complete and transparent manner. What kind of fuel will be used and which of the provided methods for the determination of fuel oil consumption for monitoring and reporting CO2 emissions or other relevant information is chosen.

There are four available methods for determining consumption; Bunker fuel delivery note (BDN) and periodic stocktakes of fuel tanks, Bunker fuel tank monitoring on board, Flow meters for applicable combustion processes and finally Direct CO2 emission measurements using calibrated equipment. It is permissible to use a combination to improve accuracy. Shipowners need to consider how to measure emissions which may involve purchasing and installing emission monitoring systems some of which can simultaneously measure and record other exhaust emissions such as NOx and SOx.

Getting help
It will be some relief to shipowners to know that assisting them in complying with the EU rules has been prioritised by several organisations especially classification societies, software and hardware producers and more beside. Almost without exception, the class societies that are part of IACS have been approved as verifiers and many of these have also developed their own plan templates that owners can use to build their own specific plans. Software that records voyage data can be useful as can the products offered by engine management and control systems manufacturers.
IMO rules differ

Unlike the EU, which has made no secret of the fact that the collection of data is intended to bring shipping into an ETS, the IMO’s rules to gather information on CO2 emissions are at present merely an attempt to quantify exact figures. What may evolve thereafter will eb a matter for national delegations to the IMO to decide and that looks to eb a very contentious debate.
The rules governing IMO data also cover only ships above 5,000gt and they are to be found in chapter 4 of MARPOL Annex VI under Regulation 22A. In addition, new appendices have been developed outlining ‘Information to be submitted to the IMO, including ‘Ship Fuel oil Consumption Database’ (Appendix IX), and ‘Form of Statement of Compliance – Fuel Oil Consumption Reporting’ (Appendix X). These rules come into effect from March 2018 and the first reporting period will be for the full year 2019.

The data that is collected under the IMO regime is reported to flag states which will aggregate it and submit the data for the f lag to the IMO for inclusion into an IMO database. The data to be submitted includes the fuel consumption data (by fuel type and in metric tonnes), as well as distance travelled and time at sea, from berth to berth.

There are other consequences of the IMO rules that will affect all shipowners including those subject to the EU regulations. All shipowners will have to ensure that by 31 December 2018, the Ship Energy Efficiency Management Plan (SEEMP) onboard each of their vessels has been amended to include the methodologies that will be used for collecting the required data and reporting that data to the flag state.

The table below sets out the core components of the two systems alongside each other for ease of comparison.

 

Future Developments

The EU intends to use the data gathered as a basis for including shipping in its ETS from 2023/24 if by 2023 the IMO has not established a means for immediate reduction in CO2 emissions from the industry.
At MEPC 72 in April 2018, the issue will be high on the agenda but while there is an acceptance of the need for shipping to become more efficient the method of doing this remains the subject of fierce debate.
The IMO has included the issue as one of its strategic developments adopted at the IMO Assembly in December 2017 and Shipping industry bodies have also submitted proposals. The IMO is planning the adoption of a revised strategy in 2023 to include short-, mid-, and long-term further measures, as required, including implementation schedules. However, there is no evident consensus on the ways to proceed as things stand.

 https://shipinsight.com/mrv-now-just-days-away/

Further to the requirement for vessels to use low sulphur fuels in all ports within the Zhejiang ECA, it has been announced that the same obligation will apply to all ports within the neighbouring Jiangsu ECA.
Correspondents Huatai have advised in their circular PNI1711 that the Jiangsu MSA have issued a formal notice on the updated requirements. It states that as of 1 September 2017 vessels calling at any port within the Jiangsu ECA must use fuel with a sulphur content of 0.5% or less when at berth (excluding one hour after and before departure).
Huatai advises this now means that the 0.5% sulphur restriction when at berth applies to all ports with the Yangtze River Delta ECA.

 Additional information at

http://www.classnk.or.jp/hp/en/tech_info/tech_main.aspx?techno=1138

and


http://www.classnk.or.jp/hp/pdf/tech_info/tech_img/T1138e.pdf

ECDIS Safeguards Ignored at Muros Grounding

The UK Marine Accident Investigation Branch (UK MAIB) issued an investigation report on the grounding of the bulk carrier ‘Muros’, on  Haisborough Sand, in December 2016, providing a description of what happened and important lessons learned to prevent similar accidents in the future.

The incident

In the early hours of 3 December 2016, the bulk carrier Muros ran aground on Haisborough Sand, 8 miles off the Norfolk coast and the master’s attempts to manoeuvre the vessel clear were unsuccessful due to a falling tide. The vessel was re-floated 6 days later and was towed to Rotterdam for repair. When Muros grounded, the vessel was following a passage plan shown on its electronic chart and display information system (ECDIS). The plan had recently been revised on the ECDIS by the OOW who then used the system to monitor the vessel’s position.

Findings

1.  The vessel was following a planned track across Haisborough Sand. The passage plan in the ECDIS had been revised by the second officer less than 3 hours before the grounding and it had not been seen or approved by the master.

2.  A visual check of the track in the ECDIS using a small-scale chart did not identify it to be unsafe, and warnings of the dangers over Haisborough Sand that were automatically generated by the system’s ‘check route’ function were ignored.

3.  The second officer monitored the vessel’s position using the ECDIS but did not take any action when the vessel crossed the 10m safety contour into shallow water.

4.  The effectiveness of the second officer’s performance was impacted upon by the time of day and a very low level of arousal and she might have fallen asleep periodically.

5.  The disablement of the ECDIS alarms removed the system’s barriers that could have alerted the second officer to the danger in time for successful avoiding action to be taken.

Safety Issues

·         The intended track over Haisborough Sand was unsafe and grounding was inevitable given the vessel’s draught and the depth of water available

·         ECDIS safeguards were ignored, overlooked or disabled

·         The track over Haisborough Sand was not planned or checked on an appropriate scale chart

·         The revision of the passage plan conficted with the 2/O’s watchkeeping duties

·         The master directed the OOW to revise the route but he did not see or approve it

·         The OOW’s performance was probably adversely affected by a low state of alertness

·         The use of software to disable the audible alarm and the guard zone removed the ECDIS barriers intended to alert bridge watchkeepers to imminent danger

·         The use of the ‘standard’ chart view limited the information displayed and the reliance of visual checks when passage planning was prone to error

·         ECDIS use on board Muros was not as envisaged by regulators or equipment manufacturers.

Actions taken 

UK MAIB has commenced a safety study, in collaboration with the Danish Maritime Accident Investigation Board, to provide further research on the reasons why seafarers are utilising ECDIS in ways that are often at variance with the instructions and guidance provided by the system manufacturers and regulators.

The overarching objective of the study is to provide comprehensive data that can be used to improve the functionality of future ECDIS systems by encouraging the greater use of operator experience and human centred design principles.

Explore more by reading the full report:

https://www.gov.uk/maib-reports/grounding-of-bulk-carrier-muros

https://assets.publishing.service.gov.uk/media/59e6020ced915d6aaafc2eb8/MurosCombinedAnnexes.pdf

Marine engine subcontractor not liable towards shipowner under product liability law

 

 

Introduction

On September 13 2017 the Supreme Court passed down its decision in a product liability appeal case between a manufacturer of marine engines and a Danish ship owner. The pivotal question before the Supreme Court was the distinction between damage to:

• the defective product itself, which was not compensable under product liability law; and
• other property, which was compensable.

Facts

A plaintiff ship owner (S) ordered 10 gas carrier new buildings between 2007 and 2010, seven of which were sister ships delivered by a Korean shipyard (Y). The defendant, a marine engine manufacturer (M), was engaged as a subcontractor.

The marine engines were fitted with an electronic cylinder lubricating system designed to reduce friction within the cylinder, as the pistons moved to and fro, thus allowing for better engine durability. Although more expensive than mechanical lubricating systems, the reduced lubricant consumption enabled by the electronic system made it the best economic choice, with an estimated payback period of less than two years.

However, after a period of service, the piston crown, liner and rings had been exposed to extraordinary wear damages, requiring overhaul and maintenance work to be carried out earlier than anticipated. S submitted that the considerable wear damages inflicted on seven of its ships' engines had been caused by a defect in the lubricating system and claimed $4,426,557.43 in damages for the losses incurred, including:

• direct and indirect expenses (ie, spare parts, repair costs and port and pilot fees);
• time loss; and
• bunker expenses.

When the contract was drawn up, the electronic lubricating system had been applied only in larger marine engines of 60, 80 and 90 cm and not in the smaller 35 cm engines in question.

Given the absence of a contractual relationship between S and M, S brought a direct claim against M under the rules on product liability developed in Danish case law. When the claim for damages was brought against M, the guarantee period and the period of notice for non-conformities had elapsed under the contracts between S and Y and Y and M.

A key hurdle for S was convincing the court that the wear damages, which were allegedly caused by M's lubricating system, constituted 'product damage' under Danish product liability law (ie, that the product delivered by M had inflicted damage to property other than that which had been delivered, and not merely to the product itself).

While the self-inflicted damage could have caused a contractual claim between S and Y for non-conformities, a product damage could merit a product liability claim for damages directly against M.

S argued that as the electronic lubricating system in both technical and economic terms could be distinguished from the engine and replaced by a different mechanical lubricating system, the lubricating system and the engines delivered by M constituted distinct and individual components. This was further supported by the fact that on choosing the engines, S was presented with a choice between the electronic lubricating system and a mechanical system. The damage therefore constituted product damage inflicted to "other property".

M argued that the damage in question should be considered damage to the product itself. The fact that the engines could be separated into component parts did not, in the defendant's view, merit a finding that the system had been sold and delivered as an individual product. M further argued before the Supreme Court that the relevant test was to examine what M had sold as a unit to its contractual counterpart Y.

Maritime and Commercial High Court decision

The Maritime and Commercial High Court found that the electronic lubricating system constituted a product, rendering the damages inflicted on the engine components product damage to other property, as required under product liability law.

The court explicitly emphasized that:

• the use of the electronic lubricating system when the contract was made should be considered a novel development for such smaller types of marine engines; and
• M had promoted the system as a distinct product in a special campaign with the potential of facilitating considerable savings.

Supreme Court decision

The Supreme Court reversed the first-instance decision and explicitly distanced itself from this rationale, stating that the fact that S had chosen the electronic lubricating system in question could not justify such a result.

On the contrary, the court found it apposite to reiterate its previous decision in Masnedø (published in UfR 2010.1360 H), wherein it had decided whether a producer of a defective component, which had been integrated into a product acquired by a later buyer, could be held liable under the Danish product liability rules.

Pursuant to Masnedø, the relevant test when distinguishing between the product in question and other property is to consider what has been sold as a unit to the plaintiff by its contractual counterpart.

Accordingly, in order to determine whether the damage constituted damage to other property, the correct test was to consider what had been acquired as a unit by S – in this case, the ship – as opposed to what had been delivered by M to Y.

The Supreme Court noted that the defendant's counsel had not made this point during the proceedings. However, this did not change the final outcome, as the court went on to find that the marine engines and the appurtenant electronic cylinder lubricating system had been sold as a single unit to Y by M. The product sold by M had therefore not caused damage to other property.

Therefore, the losses claimed for by S, to the extent that they had been caused by an alleged defect in the lubricating system, constituted damage to the product itself and, as such, were not recoverable under product liability law.

Comment

To a non-Danish reader, it is noteworthy that the Danish product liability regime is twofold. Whereas the EU Product Liability Directive (85/374/EEC) has been implemented in Danish law by statute (Produktansvarsloven), the other regime is a result of Danish case law as developed and interpreted by the courts. Compared to the EU directive, the latter regime further permits compensation for damage to property that is not ordinarily intended for private use and consumption and does not make compensation contingent on whether the property was in fact used privately (compare with Article 9(b)(i-ii) of the EU directive).

In general product liability law, the delimitation between liability for the non-conformity of goods covered by the Danish Sale of Goods Act and the rules on product liability for defective products remains a classic conundrum.

The producer will be held liable for damage caused by a defect in its product, commonly defined as physical damage to property other than the product itself. Cases wherein the product causes damage to itself are therefore assessed outside the scope of the product liability regime. Such damages must instead be determined under contract law and the rules on the non-conformity of goods.

In this particular case, the Supreme Court underlined the test previously set out in Masnedø, stipulating that the correct test when making the distinction is to examine what the claimant has acquired from its immediate contractual counterparty. Damage caused by a component part to an end product in which the component is integrated can provide grounds for a contractual claim only against the seller. In the case at hand, there were no contractual relations between S and M, and the unit that S had acquired from Y was a ship. The claim therefore had no merit under product liability law.

 

USCG raleases El Faro final report

The US Coast Guard issued an official investigation report on cargo vessel El Faro, which sank along with its 33 member crew, in October 2015, becoming one of the worst maritime disasters in US history. The investigation report on El Faro cargo vessel found that the captain underestimated the strength of a hurricane and overestimated the ship’s strength on a trip between Florida and Puerto Rico. Also, ship’s owner, Tote Maritime Inc., had not replaced a safety officer and had violated regulations regarding crew rest periods and working hours.

The incident

At the time of the sinking, EL FARO was on a U.S. domestic voyage with a full load of containers and roll-on roll-off cargo bound from Jacksonville, Florida to San Juan, Puerto Rico.

As EL FARO departed port on September 29, 2015, a tropical weather system that had formed east of the Bahamas Islands was rapidly intensifying in strength. The storm system evolved into Hurricane Joaquin and defied weather forecasts and standard Atlantic Basin hurricane tracking by traveling southwest. As various weather updates were received onboard EL FARO, the Master directed the ship southward of the direct course to San Juan, which was the normal route.

The Master’s southern deviation ultimately steered EL FARO almost directly towards the strengthening hurricane. As EL FARO began to encounter heavy seas and winds associated with the outer bands of Hurricane Joaquin, the vessel sustained a prolonged starboard list and began intermittently taking water into the interior of the ship. Shortly after 5:30 AM on the morning of October 1, 2015, flooding was identified in one of the vessel’s large cargo holds. At the same time, EL FARO engineers were struggling to maintain propulsion as the list and motion of the vessel increased. After making a turn to shift the vessel’s list to port, in order to close an open scuttle, EL FARO lost propulsion and began drifting beam to the hurricane force winds and seas.

At approximately 7:00 AM, without propulsion and with uncontrolled flooding, the Master notified his company and signaled distress using EL FARO’s satellite distress communication system. Shortly after signaling distress, the Master ordered abandon ship. The vessel, at the time, was near the eye of Hurricane Joaquin, which had strengthened to a Category 3 storm. Rescue assets began search operations, and included a U.S. Air National Guard hurricane tracking aircraft overflight of the vessel’s last known position. After hurricane conditions subsided, the Coast Guard commenced additional search operations, with assistance from commercial assets contracted by the vessel’s owner. The search located EL FARO debris and one deceased crewmember. No survivors were located during these search and rescue operations.

Conclusions – Probable Causes

·         TOTE did not provide the tools and protocols for accurate weather observations. The Master and navigation crew did not adequately or accurately assess and report observed weather conditions.

·         EL FARO Incurred a Severe Port List and Lost Propulsion : At 5:54 AM on October 1, the Master altered course to intentionally put the wind on the vessel’s starboard side to induce a port list and enable the C/M to access and close the Hold 3 starboard scuttle. This port list was exacerbated by his previous order to transfer ramp tank ballast to port, and resulted in a port list that was greater than the previous starboard list and a dynamic shifting of cargo and flood water.

·         The loss of propulsion resulted in the vessel drifting and aligning with the trough of the sea, exposing the beam of the vessel to the full force of the sea and wind.

·         The EL FARO crew did not have adequate knowledge of the ship or ship’s systems to identify the sources of the flooding, nor did they have equipment or training to properly respond to the flooding.

·         A lack of effective training and drills by crew members, and inadequate oversight by TOTE, Coast Guard and ABS, resulted in the crew and riding crew members being unprepared to undertake the proper actions required for surviving in an abandon ship scenario.

·         After 5:43 AM on October 1, the Master failed to recognize the magnitude of the threat presented by the flooding into the hold combined with the heavy weather conditions. The Master did not take appropriate action commensurate with the emergent nature of the situation onboard EL FARO, including alerting the crew and making preparations for abandoning ship.

·         When the Master made the decision to abandon ship, approximately 10 minutes before the vessel sank, he did not make a final distress notification to shore to update his earlier report to TOTE’s Designated Person Ashore that they were not abandoning ship. This delayed the Coast Guard’s awareness that EL FARO was sinking and the crew was abandoning ship, and impacted the Coast Guard’s search and rescue operation.

·         The cumulative effects of anxiety, fatigue, and vessel motion from heavy weather degraded the crew’s decision making and physical performance of duties during the accident voyage.

·         EL FARO’s conversion in 2005-2006, which converted outboard ballast tanks to fixed ballast, also severely limited the vessel’s ability to improve stability at sea in the event of heavy weather or flooding.

·         Although EL FARO’s open lifeboats met applicable standards (SOLAS 60), they were completely inadequate to be considered as an option for the crew to abandon ship in the prevailing conditions.

Recommendations

Among others, it is recommended that Commandant direct a regulatory initiative:

·         to review U.S. regulations, international conventions, and technical policy to initiate revisions to ensure that all ventilators or other hull openings, which cannot be closed watertight or are required to remain normally open due to operational reasons such as continuous positive pressure ventilation, should be considered as down-flooding points for intact and damage stability.

·         to eliminate open top gravity launched lifeboats for all oceangoing ships in the U.S.commercial fleet.

·         to require that a company maintain an onboard and shore side record of all incremental vessel weight changes, to track weight changes over time so that the aggregate total may be readily determined.

·         to require review and approval of software that is used to perform cargo loading and securing calculations.

·         to require that all Personal Flotation Devices on oceangoing commercial vessels be outfitted with a Personal Locator Beacon.

·         to develop a shipboard emergency alert system that would provide an anonymous reporting mechanism for crew members to communicate directly with the Designated Person Ashore or the Coast Guard while the ship is at sea.

·         to request that NOAA evaluate the effectiveness and responsiveness of current National Weather Service (NWS) tropical cyclone forecast products, specifically in relation to storms that may not make landfall but that may impact maritime interests.

·         to require that all cargo ships have a plan and booklets outlining damage control information. 

·         to update 46 CFR to establish damage control training and drill requirements for commercial, inspected vessels.

·         to require electronic records and periodic electronic transmission of records and data to shore from oceangoing commercial ships.

·         to explore adding an OCMI segment to Training Center Yorktown’s Sector Commander Indoctrination Course for prospective officers who do not have the Prevention Ashore Officer Specialty Code, OAP-10. 

·         to update NVIC 2-95 and Marine Safety Manual Volume II to require increased frequency of ACS and Third Party Organizations (TPOs) direct oversight by attendance of Coast Guard during Safety Management Certificate and Document of Compliance audits.

·         to establish and publish an annual report of domestic vessel compliance.

·         to implement a policy requiring that individual ACS surveyors complete an assessment process, approved by the cognizant OCMI, for each type of delegated activity being conducted on behalf of the Coast Guard. 

·         to explore adding a Steam Plant Inspection course to the Training Center Yorktown curriculum.

·         to require that all existing cargo vessels meet the most current intact and damage stability standards.

Explore more by reading the full report at,

https://www.safety4sea.com/wp-content/uploads/2017/10/UCSG-Steamship-El-Faro-sinking-and-loss-of-the-vessel-with-33-persons-missing-northeast-of-Acklins-and-Crooked-island-2017_10.pdf

 

 

 

Carefully to Carry 2017 now available!

While safety is the primary objective and loss prevention continues to be an ongoing concern for shipping, this book also touches upon a variety of issues, as vessels, cargoes and regulations become increasingly complex. In this context, the UK P&I Club has updated its Carefully to Carry publication to highlight the most current thinking in the industry.

Best practices, checklists, key points and considerations, and clear messages supported by photos and illustrations are some of the features of this manual that not only educate but also enhance the reader's existing knowledge. For example, it supplements insightfully the IMSBC Code, the IGC Code and the BLU Code, among others.

Carefully to Carry is of course not limited to dry bulk cargoes, but also covers liquid bulk cargoes, gases, packaged cargoes and a long list of other cargoes. It encapsulates the full range of potential issues around transporting bulk cargoes, from the characteristics and risks inherent in specific goods, hold preparation and hatch covers, to best practice when loading and unloading and the regulations that shippers must abide by.

By encouraging best practice around the handling and storage of potentially dangerous cargo, this book will hopefully assist in reducing the number of tragic injuries and incidents that unfortunately continue to occur. Crew members who familiarize themselves with this guide and its recommendations can significantly reduce the possibility of cargo incurring any damage, with all the resulting costs that this can bring.

Established in 1961, the C2C committee has produced many articles on cargoes that have caused many claims, and other cargo related issues such as hold washing, cargo securing, and ventilation.

All articles published by the committee are available to Members for download using the menu below, and are also available on disk and a paper volume. Member's also receive the latest reports from the committee by email, every other month through the departments email newsletter Loss Prevention News.

The quality of advice given has established Carefully to Carry as a key source of guidance for ship owners and ships' officers. In addition, the articles have frequently been the source of expertise in negotiations over the settlement of claims and have also been relied on in court hearings.

https://www.ukpandi.com/fileadmin/uploads/uk-pi/LP%20Documents/C_to_C_flashpoint_contaminations.pdf

https://www.ukpandi.com/fileadmin/uploads/uk-pi/LP%20Documents/Carefully_to_Carry/BulkOil.pdf


https://www.ukpandi.com/fileadmin/uploads/uk-pi/LP%20Documents/Carefully_to_Carry/Samples%20and%20Sampling.pdf


https://www.ukpandi.com/fileadmin/uploads/uk-pi/LP%20Documents/Carefully_to_Carry/Biofuels.pdf


https://www.ukpandi.com/fileadmin/uploads/uk-pi/LP%20Documents/Carefully_to_Carry/Liquid%20Natural%20Oils.pdf