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Anti trust competition law compliance statement

Anti-Trust/Competition Law Compliance Statement

INTERTANKO’s policy is to be firmly committed to maintaining a fair and competitive environment in the world tanker trade, and to adhering to all applicable laws which regulate INTERTANKO’s and its members’ activities in these markets. These laws include the anti-trust/competition laws which the United States, the European Union and many nations of the world have adopted to preserve the free enterprise system, promote competition and protect the public from monopolistic and other restrictive trade practices. INTERTANKO’s activities will be conducted in compliance with its Anti-trust/Competition Law Guidelines.


Imo ghg regulations

IMO GHG REGULATIONS

COUNCIL Meeting

London

5. October 2011


Ghg eedi seemp regulation
GHG – EEDI/SEEMP Regulation

  • Part of the MARPOL Convention

  • EEDI applies to new: Tankers, Bulk Carriers, Gas Tankers, Container Ships, General Cargo Ships, Refrigerated Cargo Carriers

  • EEDI does not apply to: ships with diesel-electric propulsion, turbine propulsion or hybrid propulsion systems

  • New tankers (> 400 GT):

    • building contract from 1 January 2013 and

    • delivery not later than 30 June 2015

  • SEEMP required for ALL ships



Ghg eedi seemp regulation1
GHG – EEDI/SEEMP Regulation

  • Administrations may delay the enforcement of EEDI application with up to 4 years. (i.e. building contract before 1 January 2017)

  • Parties to MARPOL Annex VI have agreed to allow ships with such waivers to call at their ports


Imo guidelines
IMO Guidelines

  • Method for EEDI calculation

  • Survey and Certification of the EEDI

  • Interim Guidelines for determining minimum propulsion power and speed to enable safe manoeuvring in adverse weather conditions

  • EEDI for larger size segments of tankers and bulk carriers

  • Cubic capacity correction factor for chemical tankers


Conclusions
CONCLUSIONS

  • INTERTANKO policy achieved

  • Phase 0: many designs are compliant

  • Phase 1: first 2 years possible waiver at owner’s request & Flag agreement

  • No waivers from 1 January 2017

  • Lower speed design – easiest “solution”

  • Intent of EEDI: better designs ~ less fuel necessary to transport same amount of cargo at the same speed as today


Council invited to
COUNCIL INVITED TO

  • Consider INTERTANKO’s views on options to waive the application of EEDI up to 4 years

  • If not in favour of such waivers – membership criterion? (e.g. all tankers contracted from 1 Jan 2013 EEDI compliant)

  • Whether INTERTANKO may express any view with regard to use of lower design speed as means of compliance


Recommended intertanko position
RECOMMENDED INTERTANKO POSITION:

  • INTERTANKO welcomes the adoption by IMO of amendments to the MARPOL Convention mandating energy efficiency measures (EEDI/SEEMP regulations) on ships.

  • INTERTANKO believes that:

    • In the implementation of the EEDI requirements, there should be a “level playing field” and that the EEDI requirements should apply equally to all applicable ships on the same effective date

    • Compliance with EEDI should focus on improved hull design, propulsion efficiency and energy optimisation, rather than predominantly on reduced speed designs

    • Any measures taken to comply with EEDI shall not jeopardise nor have an adverse effect on the safety of the ship


Market based measures

MARKET BASED MEASURES

COUNCIL MEETING

London

5. October 2011


Questions to council
QUESTIONS TO COUNCIL

  • Would INTERTANKO see any justification for a MBM?

  • No matter justified or not, should INTERTANKO support/be involved in development of the MBM legislation?

  • If involved in IMO MBMs, which model should be supported?

  • Alternatively, should a “fund free” alternative be supported? i.e. direct targeted emissions reduction from ships in operation


Market based measures one alternative
MARKET BASED MEASURES & ONE ALTERNATIVE

  • Nine MBM proposals + one alternative

  • The possible runners up:

    • International GHG FUND (Denmark)

    • Emissions Trading Scheme (Norway; UK; Germany and France) – EU ETS !!

    • Vessel Efficiency Incentive Scheme (EIS) (Japan/WSC)

    • Mandatory CO2 emission cut targets through technical and operational measures (Bahamas)


Ghg fund ets
GHG FUND ETS

OFFSETTING

SE LLING

BUYINGCREDITS

SUBMIT CREDITS

CONTORL

Levy vs. Credits


Ghg fund ets1
GHG FUND ETS

  • centralised system

  • CO2 credit vs. Levy

  • sets a target

  • ship not trading CO2

  • better predictability of costs

  • no guarantee against increase levy levels

  • Charterers involved

  • World Scale

  • sets a target

  • credits up to the cap – free or auctioning

  • additional credits – open market ( cap)

  • ships trade

  • “good ships” can sell

  • no international market

  • EU market very small

  • cruise lines like ETS


Vessel efficiency incentive scheme eis
VESSEL EFFICIENCY INCENTIVE SCHEME (EIS)

No fee for ships meeting or

exceeding applicable standard

Fee applied if not meeting standard =

($Y/t fuel) x total tons of fuel

Y = f (Δ) from the standard


Co 2 emissions cut targets
CO2 emissions cut targets

  • Technical and operational measures only

  • No penalties to pay, no rewards to be given, no funds to be collected

  • New ships (EEDI compliant)

  • Existing ships – targeted reductions

  • No compliance – no trade


Eis targeting
EIS TARGETING

  • direct reductions

  • rewards efficiency

  • EEDI relevant for operational efficiency?

  • VA not accounted for

  • slow steaming only if ME derated

  • difficult to establish target cut levels

  • limitation in using EEOI

  • fee level (improve or pay?)

  • monitoring/reporting

  • measures actual GHG emissions

  • targets each ship

  • no fund collection

  • Virtual Arrival & slow steaming will count

  • caps ship’s activity

  • ships stop trading?

  • difficult to establish target cut levels

  • monitoring/reporting



Impact on shipping
IMPACT ON SHIPPING

  • GHG FUND: 5% increased voyage costs*

  • ETS: 11% increased voyage costs*

  • MBMs high admin costs –who benefits?

  • Shipping cannot absorb all cost increase

  • MBM targets set just to collect funds?

  • If the MBM scope is , limit the cost!

* PwC Study – An analysis of the future impact of carbon regulations

on environment and industry


Conclusions1
CONCLUSIONS

  • IMO will continue to discuss MBMs

  • Choices: (a) collecting funds; (b) direct measures on ships in operations; or both

  • Monitoring/verification of CO2 emissions from each ship would be necessary

  • Shipping fuel consumption: not known!

  • Shipping lacks mechanism for proper recording of performance in operations

  • Lack of such allows other parties to initiate ship indexing


Conclusions2
CONCLUSIONS

  • Class Societies developing models to assess/measure environmental efficiency

  • Ports’ and charterers’ various Indexes

  • Others (e.g. CWR) ship index calculators

  • Shipowners may consider action

  • Ships in operations (pre- & post-EEDI) would need to evaluate, demonstrate and report their energy efficiency

  • Ships have necessary data (from SEEMP/EEOI, SOx, NOx and VOC)


Questions to council1
QUESTIONS TO COUNCIL

  • Is there justification for MBMs?

  • If so, which MBM scheme? . . . . . or

  • “in operation” indexing?

  • Industry indexing model?

  • Industry to measure and

    report its ?

  • If so, what and where to report?

  • Please, discuss and decide !


Recommended intertanko position1
RECOMMENDED INTERTANKO POSITION:

  • An MBM is not justified at this time. The industry is already incentivised by high fuel prices

  • If an MBM should be required, then this should:

    • be implemented through an international regime

    • be simple to enforce and to monitor

    • drive the right behaviour

    • provide sufficient transparency to maintain the current level playing filed

    • not be an unnecessary financial and operational burden on the industry


Recommended intertanko position2
RECOMMENDED INTERTANKO POSITION

  • Out the current proposals, the GHG FUND seems to be by far the simplest and most transparent from a ship owner point of view. INTERTANKO is not in favour of a trading scheme to reduce GHG emissions.