Environment

North American ECA zones and compliance

11 November 2014

Significant regulatory changes with respect to the maximum sulphur content in marine fuel oil are coming in to force soon, and the updated North American Emissions Control Area (ECA) will be a significant development to all shipowners trading to and from this region.

The development

On 1 January 2015 North America will implement a switch from the use of 1% sulphur content fuel to 0.10% sulphur content fuel, pursuant to MARPOL Annex VI regulations.

This is a technically and legally significant change which will require members to undertake significant due diligence in advance to ensure crews, vessels, and even chartering teams are fully aware of the impact the upcoming changes will have and how to ensure vessels can continue to trade safely and profitably in the increasingly regulated seas.

To assist members with an understanding of the impact of the upcoming changes in North America, particularly with respect to the compliance requirements under US law, as well as the penalties for failing to comply with US law, the Association is pleased to republish the attached note from Messrs. Montgomery McCracken Walker & Rhoads LLP.

Loss prevention advice

The Association has a dedicated loss prevention section for resources on air emissions regulations and compliance.

There is now very little time left before the upcoming new regulations under MARPOL Annex VI enter in to force on 1 January 2015. Members are strongly advised that even if they have no immediate plans to trade to or from an ECA, that they familiarise themselves with the new regulations and ensure they are able to comply with them. Vessels on worldwide trading may get new voyage orders that will see them go to an ECA and a shipowner that did not have business in an ECA zone before may suddenly see a lucrative opportunity appear. In such cases it will pay a great dividend to have prepared in advance.

As for regulatory compliance with US laws, the Association can only urge members to seek to be always in strict compliance. Large fines, other penalties and even prison terms have resulted not infrequently from violating US laws, in particular those relating to MARPOL offences. There is no indication that US practice, particularly that of prosecuting district attorneys, is about to change.

Should members need assistance when calling to the US or any US territory, they are advised to contact Skuld's New York office without delay and it can be reached 24 hours a day.

The Association is grateful to Messrs. Montgomery McCracken Walker & Rhoads LLP for contributing to this update.

Disclaimer

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