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IACS coatings ruling scares owners and yards alike

IACS coatings ruling scares owners and yards alike

Hong Kong: Both owners and yards are worried about the impending coating regulations which could dramatically raise the price of newbuilds. The regulations for CSR compliant bulkers and tankers look set to come into force on 8 December 2006 meaning that many owners are trying to tie up deals now ahead of implementation.
'The yards are concerned that IACS will decide to implement the rules with little or no warning,' shipbroker Clarkson Asia notes in a weekly market report. IACS will meet to discuss this from 28 November with the intention of applying the rules from 8 December which gives them no time to prepare.
'For their part, owners are concerned that existing projects which are not yet concluded could suddenly be subject to substantial cost appreciation if they are not signed by the time the rules come into effect,' Clarkson speculated.
'And, the cost looks like it could be significant. Although it is hard to be precise as the yards have not had the chance to cost the new rules yet, early indications suggest that the cost of the new rules could be greater than that for CSR earlier in the year - even for the good yards - and the new rules could cause substantial compliance issues for some of the smaller yards who will have to spend a lot of money to upgrade their facilities. It is not hard to see why the various shipbuilder's associations seem to be united in requesting the application for the new rules be delayed,' Clarkson concluded.  [20/11/06]

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