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Issue 18 - April 2016

 

Welcome to the first SEA Watch of 2016 with more updates and commentary on what’s happening in the world of shipping and marine insurance.

 

Dear reader ,

In this edition we have an article which looks at the responsibility of a ship’s Master when they receive a distress call or find people in distress on the sea. What would the Master take into account before effecting a rescue and what are his obligations thereafter? On arriving at his port of destination, just when help should be at hand, he may encounter more difficulties than he had expected before being able to get a decision from the shore Authorities to allow his rescued persons ashore.

Also of interest to our Masters will be the recent activity off the Philippines, because Zambales Province has implemented a Provincial Coastwatch Environmental Monitoring System User Fee by utilising AIS technology.  They are imposing fees on vessels transiting within 100km of their coastline.  Those charges are irrespective of whether the vessel calls at a port within the Zambles Province.  To avoid these charges, Masters are recommended to keep more than the required 100km offshore because the charging demarcation line has not been promulgated.  If charges are imposed, recommendations are made on how to challenge them.

Natalia Malashkina and Jenn Woo, two of our claims executives, report on the forthcoming changes being made to SOLAS Part VI Reg 2.  From 1st July 2016, almost all containers destined for international shipment, are required to have their gross weight verified within the State where the container was packed.  The verified weight must be given in time for that information to be used by the Master or terminal operator in the calculation of the ship’s stability.  The only exempted containers are those coming off another vessel which have already had their weight verified or are on a chassis or trailer and going onto a ro-ro vessel which is scheduled for a short international voyage.  It remains to be seen whether small and less-well financed ports will have the funding available to bring in the additional infrastructure necessary to ensure the continued smooth movement of their operations.

To finish off this newsletter we have an article produced by Sam Glatman, our sister company C Solutions’ Myanmar partner who has recently been involved in a serious casualty.  Sam reports on the various procedures and practices involved when dealing with an incident.

 

1.  Saving persons in distress upon the sea

It is a sad truth of our time that when a Master finds or is informed of persons in distress at sea, he will give serious consideration to the action that he should take and the risk of endangering his own vessel and crew.  The persons sighted may all be in distress but could be refugees, economic migrants, asylum seekers, undocumented migrants or pirates, all of which bring problems for the Master to manage.

The Mediterranean Sea, Andaman Sea and Arafura Sea are on different parts of the Globe, but are all in areas which have people fleeing from war, tyranny, famine and poverty.  Those in flight generally have a common purpose; a search for a better life.  In their endeavour, they frequently put their lives and those of their families at peril on the sea.  Such people have little knowledge of the sea and this can result in tragedy.  The UN High Commissioner for Refugees (UNHCR) reported at the end of 2015 that some 300,000 ‘boat people’ made it across the Mediterranean Sea but some 3,760 perished in the attempt.  So, what are the requirements of a Master when boat people are sighted at sea and in need of assistance?

Under SOLAS Ch.V Reg.  33, the Master of a ship which is in a position to provide assistance upon receiving a distress call at sea is bound to proceed with all speed to their assistance.  His obligation to render assistance is similar to that contained in the 1982 UN Convention on Law of the Sea and the 1979 Search and Rescue Convention.  He is not concerned about the individual’s nationality or status of such persons or the circumstances in which they are found.  His simple duty is to render humanitarian assistance.  If the Master is unable or considers it unreasonable or unnecessary to assist, he is required to enter in the log book the reason for failing to do so.

So, what must a Master satisfy himself of and what must he do?

• Are these people in distress?

• Is his vessel and crew able to provide assistance?

• In all the circumstances, is his vessel able to and does he consider it reasonable to, proceed and provide assistance?

So, what must a Master satisfy himself of and what must he do?

Weather:

Upon arrival at the distress location, the Master may take the view that the sea conditions are so horrendous that he cannot risk putting his vessel beam onto the weather or alongside the distressed vessel.  He can only stand off and assist, possibly by streaming a life raft astern in the hope of saving those from the sea.  His primary obligation is the safety of his own vessel and crew and he is only required to do that which is reasonable in all the circumstances.

Boat People:

The sheer number of persons requiring assistance may mean that the vessel cannot accommodate them all.  Such humanitarian assistance would entail standing by and calling for other merchant vessels and Government vessels to assist, providing food and medical support as best they can.  However, time, weather conditions, location and dangers may result in the vessel having to take on board many of the survivors.  This could prove a hard decision for the Master.  If he is incapable of taking them all on board, should he sacrifice one of his own lifeboats or life rafts to aid the survival of those that have to be left behind and so reduce his own safety standards?

Conditions on Board:

For those who have been taken on board, there is a new dilemma for the Master, having to allocate his supplies of food and manpower to sheltering, provisioning and caring for the survivors.  It could be a logistical nightmare.  Providing shelter from the weather, in all its guises, can be a formidable task if his crew of twenty has swelled by a further twenty survivors, but there could be several hundred to take on board.  If the Master knows he will be transiting an area where ‘boat people’ may be found, should he as a precautionary measure, have additional stores and equipment on board to deal with such an eventuality?

Of the survivors, what happens next? It may be that they had hoped to make a particular landfall and that being on board a merchant vessel, they would expect to be landed at the nearest port.  Imagine their surprise if picked up in the Timor Sea to be told that their next port of call is to be the port they departed from, or that they were bound for Rio-de-Janeiro or Cape Town! Would that result in a violent outburst from those the Master had just saved? If so, how would it be controlled when all of his crew are already fully tasked?

Throughout the time on-board, the Master has to treat the survivors humanely, taking account of his own resources.  SOLAS requires the vessels providing assistance to be released from their obligations with minimum (further) deviation from the ship’s intended voyage.  In resuming his voyage with the boat people on board, the Master is not required to deviate to the nearest port, but subject to orders, may proceed to the port to which his vessel had been bound, irrespective of where it is.  He is only required to land them at a safe port, but getting permission to enter that port may mean arguing with the Local Authorities whose view of the legislation may differ from that of their own Government.

It is the (contracting) State within which the Maritime Rescue Co-ordination Centre (MRCC) controlling the rescue operation is located that is required to facilitate the disembarkation of survivors and deliver them to a place of safety.  If that port is out with the jurisdiction of the MRCC that was controlling the rescue, then SOLAS requires the (MRCC) State to be overall responsible for State co-operation, ensuring that the boat people are disembarked as soon as reasonably practicable and taken to a place of safety.  Finding out who to go to within a State organisation is never an easy task, even less so if they do not want to get involved.

Expenses:

If the Owners decide that the Master should deviate to another port, who pays for the victuals, lost time and deviation expenses? Not the distressed persons, who probably have little more than the clothes they are wearing and some personal effects.  As far back as 1873, the English High Court held that such personal effects could not be arrested and did not form a claim in (life) salvage.

The fuel and crew costs as well as the expense of feeding and providing for those assisted will be paid by the shipowner.  His P&I Club and hull underwriters may be likely to be there to assist and compensate. Subject to the terms of cover, deviation/diversion expenses together with the cost of medical treatment and victuals for those rescued, can be claimed.  What is clear however, is that except where there is property salved with the survivors, there is no claim for salvage and therefore no claim for life salvage.  Article 16 of the 1989 International Convention on Salvage affirms that no remuneration is due from persons whose lives are saved. That provision does not restrict a State from making their own laws which may require saved persons to make recompense, but such a situation would be rare.

Lost Hire:

Time is a different factor.  Deviation and thus lost time is not an expense and so out with the terms of P&I cover.  Unless the vessel is under a time charter where the charterer has agreed to share the expense of deviation to save life and/or property, the lost hire or cost of delay will be on the Owners account.

Deviation to a Suitable Port:

It is usually an Owners decision on whether to deviate to a suitable port, en route to their planned next port of call.  Upon arrival, the Master having done all that is required of him will be under the common belief that the survivors are landed and the vessel departs with the minimum of delay.  Such are the obligations under SOLAS but we all learn from history.  The Master of the “PRESTIGE” thought he was heading for a port of refuge when his vessel started breaking up, but was refused entry by France, Spain and Portugal.  Would the Authorities order the vessel to another port? If so, would the Master be required to comply with such orders, or just best advised to do so?

What of the survivors? The Master is not required to give any consideration to their status and indeed SOLAS regulations expressly prohibit such distinctions being made.  It is only when an attempt is made to land the survivors that the Authorities ashore start labelling them.  What the Master thought would be a few hours’ delay could be many days, whilst the Authorities process those on board and decide whether they can be landed.  The Master may find that some are refused entry, whilst others may refuse to go ashore.

The UNHCR recorded in their round table paper for discussion in March 2002, that there was a lack of clarity and possible lacunae in international maritime law when determining the steps that follow once a vessel has taken survivors on board, i.e., where should the vessel proceed to? It is not clear as to why this is an issue, since time memorial merchant shipping have assisted everyone in peril on the sea and proceeded thereafter to their next intended port of call, since such would result in the minimum of deviation from the vessel’s voyage.  Why should there be a new obligation on a Master to deviate to the nearest place of safety (which could be many hundreds of miles away and in the ‘wrong’ direction) if he is of the opinion that he can safely reach his intended port?

Ten years on, and the UNHCR paper on Refugees and Asylum Seekers in Distress at Sea – How best to respond (Nov. 2011) records that changes in International Conventions have strengthened the framework governing rescue at sea, notably by establishing an obligation for all (signatory) States to co-ordinate and co-operate in rescue at sea operations.  The Conventions only raise an obligation, they cannot force a State to do anything and therefore practical and operational challenges remain.  They say these are due in part to search and rescue operations triggering the responsibilities of different States and that those responsibilities may conflict with “migration management and security objectives relating to irregular sea arrivals.” Lack of capacity to implement search and rescue obligations or to receive persons rescued at sea upon disembarkation, can complicate matters.

Their dialogue does not make for a clear understanding as to what they mean; Are they saying that only some coastal States are fulfilling their International obligations to permit distressed persons to be landed and the vessel depart without unnecessary delay?  The scheduled port of call is frequently agreed upon by Owners because some delay is expected and if the vessel can continue her operations whilst survivors are disembarked, then time lost will be minimised.

The UNHCR paper highlights a core challenge in any particular rescue at sea operation involving asylum-seekers and refugees (who may be unknown to the Master) and that is the timely identification of a place of safety for the swift disembarkation of the distressed persons.  They suggest that if a Master faces delay in disembarking those that he has rescued, then he may be less ready to come to the aid of others in the future.

Difficulties in landing distressed persons are not going to change the ingrained tradition of seafarers helping those in peril on the sea.  What it will require is a more detailed assessment by the Master and the Owners before agreeing to take persons on board.

Can assistance be given without those in peril abandoning their own vessel? What number can be taken on board? Where are the distressed persons to be landed?

Some local Authorities may consider the disembarking of survivors as a matter for vessel’s Flag State.  Therefore, before proceeding on passage to a particular port, the various options should be considered: the nearest safe port within the MRCC area of responsibility; a Flag State port or the preferred port, taking account of the vessel’s commercial interests?

The Local Authorities infrastructure to deal with a mix of persons to be landed, may be inadequate.  There is a further complication, refugees and asylum seekers are protected under the 1951 Refugee Convention from being returned to the territory (or any other territory) where their life or freedom would be threatened.  This is why returning those persons saved to their port of embarkation may promote unrest and may result in a refusal by those individuals to leave the vessel.  The Authorities may decide to hold the persons on board, causing inevitable delay, whilst the administrative work is carried out ashore.

The Categories:

The Authorities ashore will hear the applications of those to be landed and decide whether an asylum seeker, who is seeking international protection from their own country of nationality for fear of persecution, truly is a refugee.  A classification on their nationality is crucial to their asylum application.

Economic migrants who could be at the mercy of people smugglers, trying to escape war, civil strife or poverty and in search of a better life, may not qualify as refugees. Their plight may not extend to a risk of persecution as defined by the Refugee Convention. The Authorities may have to resolve criminal issues, if the rescue had to be carried out whilst a (people) smuggling operation was ongoing.  Such an event does not prevent those rescued from seeking asylum, it only adds a further complication to the mix, particularly if the people smugglers were on-board and are numbered with the survivors.

Responsibility for stowaways has long been placed at the door of the shipowner and remains with them until resolution of the stowaway’s asylum application. Whilst Masters could deal with one or two stowaways, who would usually remain onboard to the next port and there be landed and ‘handled’ by the Owner’s P&I Club representative, today’s boat people are so numerous that only State intervention can resolve the issues which arrive with each boat.

Piracy:

As a foot note, what if the true intentions of those seeking assistance was to attack the vessel? Of course the Master could legitimately take measures to prevent boarding and proceed away from the scene.  It is surprising how vulnerable one can feel on the bridge of a slow moving bulker with a much smaller but faster boat alongside, crewed with armed men, determined to board.  But then, the situation is unlikely to be as clean cut - armed men seen approaching in fast boats from their Mother ship.  The ‘distressed’ vessel could appear to be a broken down fishing boat many miles from shore, waiting for the arriving ship to slow down.  With legitimate concerns, a Master would be within his rights to put the safety of his crew first and proceed away from the area.  His only obligation would be to enter a remark in the log book as to his decision.  He could report the incident to the IMB Piracy Reporting Centre.  It may be that those fishermen were truly in distress, but such is the doubt that has been created with the increase in piracy worldwide that a Master cannot risk getting it wrong.  His primary obligation remains the wellbeing of his ship and crew.

 

2.  Charges imposed on vessels exercising their right of innocent passage

1)  Zambales Province in the Philippines has unilaterally passed legislation (Philippines is Ordinance No.  28 Series of 2015 ) which imposes a “Provincial Coastwatch Environmental Monitoring System User Fee" on foreign vessels transiting between 15km and 100km off their coastline.  This unilateral move to charge is imposed irrespective of whether the vessels call at any of the ports within Zambales Province.

2)  The new ordinance appears to ignore the 1982 UNCLOS Convention on the Law of the Sea and the right of innocent passage which the Philippines ratified in 1984.

3)  Ships of all States are entitled to exercise the right of innocent passage through a State’s Territorial Sea, which (with few exceptions) means a continuous and expeditious navigation of the area, not prejudicial to the peace and good order of the coastal state.

4) Despite the right of innocent passage, Zambales Province together with assistance from the Subic Bay Metropolitan Authority and their Coast Guard are taking steps to impose charges determined by a vessels’ gross tonnage (GT), type and Flag.  Monitoring of traffic and administration is being carried out by Xanatos Marine Ltd of Canada, who are determining the identity of vessels passing within 100km of the shore base line using advanced radar and AIS monitoring systems.

5)  The charges being imposed vary from US$0.0358/GT for a foreign non-passenger vessel, US$0.041/GT for a foreign passenger vessel, US$8.25/GT for foreign fishing vessels and US$12.57/GT for “other” foreign commercial vessels as well as fixed annual charges for their own Flagged vessels.  There is no guidance on the types of vessels which fall within the “other” category.

6)  S1 of UNCLOS 1982 stipulates that the sovereignty of a State only extends out to the edge of their Territorial sea, which is stated to be no more than twelve nautical miles from their coastal base line.  Whilst the State can adopt laws and regulations for the innocent passage of vessels transiting their Territorial Sea, (as well as the contiguous zone) by Art 26 they are not permitted to levy any charge upon foreign vessels merely because they are exercising their right of innocent passage.  There is an exception, where specific services are rendered to the vessel but such charges must be levied without discrimination and therefore must be the same for all vessels.

7)  We consider the Ordinance is in breach of the UNCLOS Convention in several respects: a) It seeks to impose charges out to 100km from their coastal base line instead of to the edge of the Territorial Sea; b) It imposes different levels of charging depending on the type of vessel; c) It seeks to impose a charge where no service has in fact been rendered.  It cannot be said that a vessel exercising her right of innocent passage and no more, has utilised a service which is available in case of an emergency.  Similarly, a vessel safely passing 80km or 100km off the coast, has not utilised the services of any coastal light house or station.

8)  Notwithstanding the above problems, invoices are being sent on behalf of the Government of Zambales, to Owners and managers of vessels which have passed within the 100km corridor.  A 30 day period is given for settlement, failing which the sum claimed will increase by 20% per month until payment.  Enforcement will take place when the vessel next calls at a port in Zambales.  The vessel would not be allowed to leave until payment has been received and clearance obtained from the Office of the Governor.

9)  Local agents advise that to date, there are no local charts or internet advice from the Authorities to detail the base line co-ordinates and outer limit of the charging zone.  So a Master trying to navigate safely and avoid the 100km zone would need to add a safety margin to ensure his vessel transits clear of the charging zone.

10)  A point in Owners favour is that to date, no other Province within the Philippines is known to have implemented similar legislation nor are any Provinces known to be assisting Zambales Province in enforcing the invoices which have been issued. Consequently, a vessel calling at a port within Zambales province is subject to the charges and enforcement thereof.  However, if a vessel is not calling at any of their ports and is not likely to, there appears little that the Zambales Government can do to enforce payment.

11)  Earlier the Filipino Shipowners Association (FSA) were reportedly requesting their Congress to urge the Department of the Interior and Local Government (DILG) to revoke the Ordinance.  The FSA were also endeavouring to have all issued invoices, cancelled by the Province.

12) The early part of 2016 has seen growing criticism from governmental bodies against the Ordinance, alleging constitutional and statutory violations.  The Maritime Industry Authority (MARINA) and the Department of Justice (DOJ) have issued separate opinions, supporting the industry’s challenge to the Ordinance and their strong objection to its implementation.

13)  As at the time of writing, the Province of Zambales has not issued any amendment or revision to the Ordinance.  However the situation is being monitored by Del Rosario & Del Rosario, to whom problems can be addressed.  Any changes will be promulgated.

 

3.  Shippers must verify their container weight

With effect from 1st July 2016, amendments to SOLAS chpt.  VI Regulation 2 will require the Shipper of containerized cargo, intended for an international voyage, to have the weight of the loaded container verified using calibrated and certified equipment. The only alternative is to use a State approved method to weigh all the individual cargo in the container, including the lashing and dunnage material and add to the result, the tare weight of the container. This verification must be done within the State where the container was packed.

An exception to the above will be containers loaded on a chassis or a trailer, and driven onto a ro-ro ship, but only if the containers are going on a short international voyage. Essentially, that is one which is not more than 600 miles.  However, a container on a chassis and loaded onto a vessel for an international voyage will still have to have its gross weight verified.

Previously, container weights were self-declared by the Shippers and whilst some were weighed and checked at the port facility prior to loading, there was no law requiring the Terminal to do so.  With the ever increasing size of container vessels, some form of legislation had to be brought in to ensure that accurate information was being given by the Shipper and used by a ship’s Master or the terminal responsible for calculating the vessel’s stability.  Any container found to be at odds with its verified certificate will not be shipped until its gross weight has been checked and re-verified.

Seafarers rely on the bona fides of the shipping documents because the weights and loading locations are used by the ship’s personnel to determine the ship’s stability condition and ensure that it complies with the Load Line Regulations. Without accurate information, compliance cannot be verified.

There is always a chance that some containers are over or under weight (the need to have accurate weights for containers at the time of loading cannot be underestimated).  Maersk, with other companies closely following, have brought into service their Triple E vessels of 165,000 DWT, capable of carrying 18,000 TEU’s.  The next generation, capable of carrying 22,000 TEU’s, is already on the drawing board.  With single 20’ containers weighing as much as 30MT, a 2.5% inaccuracy in the loaded weight could add 4,000MT to the intended loaded tonnage, breach the load line regulations and seriously affect the vessel’s stability calculation, with possible disastrous consequences for the Master and crew.

The quality and sophistication of port facilities differ throughout the world. A requirement to weigh all containers being shipped out of Rotterdam or other well developed and funded facilities may result in minimal delay and cost.  However, in less developed or funded facilities, this small change in regulations may cause significant issues with the need for new equipment and more quay space.  In parts of Indonesia and Vietnam, road transport only accounts for some 10%.  Of container movements.  By far the largest quantity of containers, upwards of 90%, arrives by barge.  The barges arrive with a tight schedule for transfer of their containers onto the quay and movement to the gantry cranes for loading.  Their transfer to the quay is by the same gantry cranes that would be working the deep sea vessels, but they are only released to do so once the deep sea vessel’s schedule permits.  Those off loaded containers would have been stacked for loading, probably onto the next vessel alongside.  With those containers having to have verified weights, they will need to be transported from the discharged barge area to a weighbridge and back to the stacking area.  This increased time is likely to disrupt the container movements within the terminal, require more cranes, a larger stacking area and more plant to move the containers around the yard.

A double movement with a crane and a straddle carrier or similar, from the barge to the quay, to the weigh bridge and back to the stacking area should not take much time or cause a delay to the deep sea vessel, but that is a real possibility. The Regulations do not give any time limit for the provision of the verified certificate save that it must be in time for the Master or Port Terminal to use in their stability calculations.  A 6,000 TEU feeder may not be unduly inconvenienced but an 18,000 TEU trans ocean carrier with forward planning of containers to be loaded, probably several days in advance may have to shut out cargo because it is too late to go through the verification procedure. The time alongside for these vessels is scheduled months in advance and it remains to be seen how much additional investment will be required for plant and storage areas to meet these new regulations and keep the vessels on schedule.

Although the change in SOLAS regulations appears small, it is important that it is enforced by the loading ports.  It is hoped that the safety measures which the new regulations strive to achieve are not compromised because of the additional cost of infrastructure to meet the vessel’s sailing schedule.

Ref:
MSC.1/Circ.  1475
https://www.worldshipping.org/industry-issues/safety/WSC_Guidelines_for_Implementing_the_SOLAS_Container_Weight_Verification_Requirement.pdf

 

4.  Managing a serious incident in Myanmar

On 25 January 2016, two loaded ships collided close to the entry point of the Yangon River, one of which quickly sank. Fortunately all 14 crewmembers were rescued without injury and transferred to the port of Yangon.

On 26 January I was requested to offer support in helping to manage this case as C Solutions’ “man on the ground” in Yangon, representing Owners, Insurers and Club involved with the sunken vessel. I have represented C Solutions in Myanmar for the past three years, speak some Myanmar language and have got to know the local marine interests.  I would like to think I have some knowledge of how to “get things done”.  My primary responsibility involved liaising between C Solutions, the agent, local lawyers and the authorities.

The first and obvious takeaway in this kind of work in Myanmar is that an incident such as this does not happen often.  In fact, the last incident approaching this level of complexity took place in 2004.  As a result, the processes for dealing with such incidents are not well documented or clear.  Providing some education and honest answers to the relevant authorities is key to managing expectations and building trust.  This is particularly relevant when planning salvage operations—a formidable task when a vessel sinks, containing 3,500 tons of cement, in an exposed area with zero underwater visibility and extremely strong currents.

Yangon experiences three distinct seasons, winter (November-February), summer (March-May) and monsoon (June-October).  While the winter and summer seasons are dry with temperatures ranging from 18-33 C in winter and 30-40 C+ in summer, the monsoon sees monthly rainfall averages of up to 312mm and extremely strong currents.  Therefore any kind of salvage operation is not possible for around five months of the year.

Our immediate goal was to gain a better idea of the state and position of the wreck and establish the most efficient way forward. With this in mind, perhaps the most interesting initial challenge was to identify who, out of several overlapping government departments, was responsible for granting the relevant approvals to conduct damage surveys and site visits.  As we discovered, the answer to this question was not clearly established among the authorities. Consequently, we needed to arrange meetings with all possible lines of command and then wait for several days while they coordinated among themselves.  That being said, every effort was made to assist us in conducting our work and the first stage desired outcomes were achieved.  Once aligned the various authorities were more efficient and the matter is ongoing.

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