Shipowners fight proposal for EU Ship Recycling License

ECSA Secretary General Patrick Verhoeven. ECSA Secretary General Patrick Verhoeven.

JULY 8, 2016 — Shipowners are reacting strongly to a proposal that the European Uniob set up a ship recycling fund, with shipowners being compelled to pay for it with what is called a "ship recycling license," effectively a port call tax on ships visiting the EU, regardless of flag.

Shipowners say that if plans for EU ship recycling fund are taken forward, they will cause serious problems with the EU's trading partners, including China, India, Japan, and the United States.

The European Community Shipowners' Associations (ECSA) and the International Chamber of Shipping (ICS) – which represent over 80% of world merchant tonnage – insist that the concept of the ship recycling license, developed by consultants for the European Commission, must be firmly rejected.

Under a proposal now being considered by the European Commission, the money that visiting ships would have to pay into a proposed EU Fund, including those flying the flag of non-EU nations, would only be returned at the end of the vessel's working life, many years later, when it will probably have a different owner, and only on condition that the ship is recycled at a yard approved by the European Commission

"As well as being unduly complex, widely impractical and very difficult for the EU to administer, the establishment of such a Fund will be an affront to the international community which has adopted the Hong Kong Convention on ship recycling, whose standards have already been incorporated into a similar EU Regulation" said ECSA Secretary General, Patrick Verhoeven.

ICS Secretary General, Peter Hinchliffe added "Such a draconian unilateral measure, especially if applied to non-EU ships, is likely to be seen by EU trading partners as anti-competitive interference into the conduct of international shipping. There is a real danger that other nations would apply retaliatory measures."

ECSA and ICS argue that the EU should concentrate its efforts on getting EU Member States to ratify the IMO Hong Kong Convention, and to recognize the efforts being made by recycling yards in Asia to gain certification in accordance with IMO standards. They say these yards should be given a fair chance to be included in the EU list of approved recycling facilities that is being established under the EU Ship Recycling Regulation.

ECSA and ICS are preparing a detailed commentary on the proposals that they will be sharing with the European Commission, as well as EU Member States and the European Parliament.

ECSA and ICS say that the shipping industry is committed to the implementation of the IMO Hong Kong Convention. ECSA and ICS (with other industry organizations) have also recently published comprehensive guidelines on "Transitional Measures" for shipowners selling ships for recycling, to ensure that end of life vessels are only recycled in accordance with agreed IMO standards, in advance of these coming into legal force worldwide.

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