International shipping association BIMCO's Documentary Committee approved the use of a standard term sheet in ship financing transactions on Nov. 17, 2016. It has been developed by a subcommittee consisting of representatives from five banks, five shipping companies and three law firms.
BIMCO thinks that A BIMCO standard will serve as an important tool for shipowners, banks and lawyers when they draw up term sheets in the process of ship financing transactions. It is said to be particularly useful for small- and medium- sized companies with not so much experience in such transactions.
The term sheet will be published in early 2017.
UK's Financial Conduct Authority (FCA) approved of Singapore Exchange's acquisition of London-based Baltic Exchange Limited on Oct. 13, the Baltic Exchange confirmed.
The approval comes on the back of the green light received from Baltic Exchange's shareholders on the GBP 87 million takeover deal following a period of extensive consultations.
The Baltic Exchange said that, after the approval of the earlier agreed scheme by Baltic Exchange shareholders on Sept. 26 and in light of the decision by the FCA, the Court Hearing to sanction the scheme, which was initially expected to be in late November 2016, has now been scheduled to take place on Nov. 7.
The acquisition is the latest in a series of mergers and acquisitions in the world of exchanges, prompted by the persistent downturn in the shipping industry, according to Reuters.
Singapore Exchange Limited (SGX) and Baltic Exchange agreed on the terms for the recommended offer by SGX for the entire issued share capital of the Baltic Exchange in late August.
Under the terms of the acquisition, Baltic Exchange shareholders will be entitled to receive GBP160.41 in cash for each Baltic Exchange Share and GBP19.30 in cash per Baltic Exchange Share as a final dividend.
The next steps in CO2 reduction for shipping could be determined at the end of October 2016, according to the European Community Shipowners' Associations (ECSA).
The announcements comes on the back of International Civil Aviation Organisation's (ICAO) agreement on a new global market-based measure to control Green House Gas (GHG) emissions from international aviation reached last week.
"We are confident that at the end of this month the International Maritime Organisation (IMO) will decide on the next steps for shipping," said ECSA President, Niels Smedegaard.
The shipping industry has a mandatory global CO2 reduction regime which has been in force since 2013. IMO will now build on the substantial CO2 reductions already achieved by shipping, introducing a global CO2 data collection system, which will be fully operational by 2018.
Based on the data collected and a real understanding of the emissions, realistic targets for CO2 emission reduction can be set for the sector, according to ECSA.
"We fully support our colleagues at the International Chamber of Shipping (ICS) in their recent plea to set a timeline for the further reduction of the shipping sector's GHG emissions," Smedegaard said, adding that "it is important that IMO doesn't stop at data collection and effectively responds to the Paris Agreement on climate change."
Accession by Finland has triggered the entry into force of the IMO Ballast Water Management Convention.
The Convention will enter into force on Sept. 8, 2017, marking a landmark step towards halting the spread of invasive aquatic species, which can cause havoc for local ecosystems, affect biodiversity and lead to substantial economic loss.
Under the Convention's terms, ships will be required to manage their ballast water to remove, render harmless, or avoid the uptake or discharge of aquatic organisms and pathogens within ballast water and sediments.
"This is a truly significant milestone for the health of our planet," said IMO Secretary-General Kitack Lim.
"The spread of invasive species has been recognized as one of the greatest threats to the ecological and the economic well-being of the planet. These species are causing enormous damage to biodiversity and the valuable natural riches of the earth upon which we depend. Invasive species also cause direct and indirect health effects and the damage to the environment is often irreversible," said he.
He added, "The entry into force of the Ballast Water Management Convention will not only minimize the risk of invasions by alien species via ballast water, it will also provide a global level playing field for international shipping, providing clear and robust standards for the management of ballast water on ships."
Finland's accession brings the combined tonnage of contracting states to the treaty to 35.1441 percent, with 52 contracting parties. The convention stipulates that it will enter into force 12 months after ratification by a minimum of 30 States, representing 35 percent of world merchant shipping tonnage.
The Convention will require all ships in international trade to manage their ballast water and sediments to certain standards, according to a ship-specific ballast water management plan. All ships will also have to carry a ballast water record book and an International Ballast Water Management Certificate. The ballast water performance standard will be phased in over a period of time. Most ships will need to install an on-board system to treat ballast water and eliminate unwanted organisms. More than 60 type-approved systems are already available.
"The entry into force is a very good step towards clarifying what ships have to deal with in the near and bit farther future," says specialist ballast water management consultant Jad Mouawad. "Many questions remain during the implementation phase: how the revised Type Approval guidelines will be integrated into the retrofit timeline, how ship owners should choose a ballast water treatment system strategically to ensure compliance with the U.S. Coast Guard requirements (that have not yet type approved a ballast water treatment system), what changes will the IMO do to the Convention text besides the timeline changes already agreed to.
"The immediate reaction to the anticipated ratification for us has been a sharp increase in requests for market and feasibility studies for shipowners. Simply put, shipowners are asking us which systems they should buy, how to lay an installation strategy based on their scheduled survey dates, dry docks and so on. I recommend all shipowners to do this homework before starting to buy systems."
Classification society American Bureau of Shipping (ABS) has released two new tools focused on assisting the container ship sector with pressing operational challenges.
The two tools are expected to contribute to safety for the sector and include the Guide for Certification of Container Securing Systems (Container Securing Guide) along with its companion software, and the Guide for Fire-Fighting Systems for On-Deck Cargo Areas of Container Carriers (FOC Guide).
"In today's operating environment, container ship owners must improve performance while maintaining reliability and safety," said Matt Tremblay, ABS Vice President for Container Ships.
As container ships become larger, stack weights increase, and new lashing systems are designed, container ship owners and operators are facing increased challenges to optimize the cargo securing systems on their vessels.
To help address this concern, ABS said it has updated the Container Securing Guide dealing with new procedures for twist lock testing. By year's end, the guide will introduce changes in on-deck container stack load analysis and lashing bridge design load calculations, introducing a methodology to on-deck container stack load analysis to more accurately determine container carrying capabilities.
To facilitate application of the updates to the guide, ABS has developed a software tool known as C-LASH. The tool provides full non-linear direct calculations for load analysis of on-deck container stacks.
The International Maritime Organization (IMO) requirements for additional container deck firefighting capabilities went into effect this January. In order to comply with the new regulations, ABS has updated its FOC Guide. According to the classification society, the FOC notation provides additional arrangements that improve capabilities for fighting fires on deck in cargo areas of container carriers.
China's Port of Shenzhen is planning to introduce a requirement for ships to use fuels with no more than 0.50% while at berth from Oct. 1, 2016, ahead of other key ports in the Pearl River Delta, which are due to implement the requirement on Jan. 1, 2017.
The decision, taken by local authorities, is due to be formally announced by the Shenzhen Maritime Safety Administration (MSA Shenzhen) soon, the International Bunker Industry Association (IBIA) cited a circular from Huatai Insurance Agency & Consultant Service.
Chinese authorities have unilaterally decided to introduce domestic emission control areas (ECAs) in three coastal regions, requiring ships to use fuels with no more than 0.50% sulphur, initially at berth and then from Jan. 1, 2019 while operating within the designated ECAs. The three areas are the Pearl River Delta, the Yangtze River Delta and Bohai-rim waters.
Eleven key ports were identified within these three ECAs where the low sulphur requirement would take effect from Jan. 2017, and from Jan. 2018 the requirement would be extended to all ports located within the ECAs.
The 0.50% sulphur at berth limit became effective for ships at berth in key ports in the Yangtze River Delta ECA, namely Shanghai, Ningbo-Zhoushan, Suzhou, and Nantong, from April 2016.
Under the Chinese requirement, ships must switch to compliant fuel within one hour of arriving at berth and continue to use it until not more than one hour prior to departure.
As an alternative to using low sulphur fuels, ships can plug into shore power where available.
Towards the end of 2019, the Chinese government is scheduled to determine if the fuel sulphur limit in its domestic ECAs should be reduced to 0.10%. This would bring the Chinese ECA requirements into line with MARPOL Annex VI, the International Maritime Organization regulation.
Beijing is clamping down further on ship emissions in rulings that could change the shipping industry forever. The Chinese government has come under pressure to act over the dire state of the environment and has already taken sweeping measures against many industries, including shipping with the creation of the nation's first ECAs (emission control areas). It is now going a step further, issuing its first ever set of national standards to curb harmful emissions from the shipping industry.
The standards issued jointly by the Ministry of Environment (MEP) and the country's quality watchdog – the General Administration of Quality Supervision, Inspection and Quarantine – aim to cut emissions of greenhouse gasses and other particulate matter from ships with an engine capacity of over 37 kilowatts.
MEP data claims that the shipping industry contributed 8.4% of the total sulphur dioxide emissions and more than 11% of nitrogen oxide released in 2013.
In the first stage of the new standards, the shipping industry is required to cut emissions of PM10 and PM2.5 by about 70% from the levels in 2016 over the next three years. 20% of the current nitrogen oxide emissions must also be slashed over the same period.
The second stage will see ship operators need to cut another 40% of PM10 and PM2.5 emissions from levels in 2019 and reduce nitrogen oxide emissions by a further 20% from 2020 to 2022, according to the document.
On Aug. 1, 2016, the European Commission adopted a decision granting recognition to the Indian Register of Shipping (IRS) in accordance with Regulation (EC) No. 391/2009 of the European Parliament.
The Deputy Director General MOVE, Mr. Fotis Karamitsos in a letter dated Aug. 5, 2016 conveyed this decision and has extended his compliments to the Indian Register of Shipping.
With this, IRClass joins the elite group of classification societies recognized by the EU.
This recognition confirms IRClass meeting the stringent EU requirements and having a "performant and well-established quality system in place, certified as compliant with relevant statutory and industry standards, currently implemented throughout the organisation."
The approval paves the way for IRClass to now access the very important European market.
Malaysia's Ministry of International Trade and Industry has introduced new tax incentives for shipbuilders and ship repair yards.
The ministry said in a statement that new companies can either opt for pioneer status which comes with a 70% of income tax exemption on statutory income for five years or an investment tax allowance of 60% on the first qualifying capital expenditure incurred within five years.
Malaysia has 100 shipyards, of which six are deemed large. Shipbuilders' heavy focus on offshore-related construction has seen orders dry up in the past couple of years. Within Southeast Asia, Malaysia faces great competition when it comes to shipbuilding with neighbours in Indonesia, Singapore, Vietnam and the Philippines all having significant yard facilities.
Indian seafarers could well start to price themselves out of the market with shock news that the income tax department will now tax them up to 30% of their salaries whether working on local or foreign flagged ships.
Until this month, Indian crew who spent more than six months at sea had enjoyed similar benefits to non-resident Indians, but now following an income tax tribunal in Kolkata that could all change. Tax authorities are also looking at taking tax income from the previous six years.
India is one of the world's largest suppliers of crews to the world's merchant fleet.
Two seafarers associations, the Maritime Union of India (MUI) and the National Union of Seafarers of India (NUSI), are set to challenge the tax tribunal decision.