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Shipping must be ready for 0.5% sulphur cap, says ICS

Shipping must be ready for 0.5% sulphur cap, says ICS
The shipping and bunker refining industries must move to prepare for the global 0.5% sulphur cap, even if it is delayed until 2025, the International Chamber of Shipping (ICS) has stated.

"While postponement of the sulphur global cap until 2025 is still a possibility, the shipping and oil refining industries should not assume that this will happen simply because they are unprepared," said ICS chairman Masamichi Morooka. "ICS has concluded that, for better or worse, the global cap is very likely to be implemented in 2020, almost regardless of the effect that any lack of availability of compliant fuel may have on the cost of moving world trade by sea".

The possibility of a deferred implementation, until 2025, is allowable under Annex VI of the IMO MARPOL Convention, subject to a fuel availability study that IMO is legally required to complete before the end of 2018. ICS has criticised IMO Member States for refusing to demand the study be conducted earlier, indicating that, "if supply problems are identified at the end of 2018 this will be far too late for governments to take action."  When the cap is implemented, it is expected to cost the shipping industry up to $50bn annually ICS claim.

"ICS member national shipowners' associations have therefore concluded that a political decision may in effect already have been taken, at least by the United States and the European Union which view the global cap as a public health issue," the chamber said.

ICS further restated its "deep concern" with the EU's decision to go ahead with its own mandatory Monitoring, Reporting and Verification (MRV) requirements, ahead of IMO. "The EU Regulation will have major implications for the IMO negotiations on a global data collection system which, until now, have been progressing well.

"There is a real danger the EU initiative will be seen by non-EU States as an attempt to present them with a fait accompli which includes controversial elements, such as the publication of individual ship efficiency data, which had previously been rejected, for the moment at least, by the majority of governments at IMO."

The ICS said it "remains concerned that the ultimate motive behind the EU Regulation is to establish a mandatory ship efficiency indexing system that will be used to penalise ships financially, in a manner that could lead to a serious market distortion throughout the global shipping industry".