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HANSA 03-2019

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Schifffahrt | Shipping

Schifffahrt | Shipping »Don’t fear talking to the US Coast Guard« Maritime transport within the United States requires a deep knowledge not only of the complex network of the domestic environmental regulations but also of international law and the conduct of the various US authorities. Jeanne Grasso, partner at the law firm Blank Rome in Washington D.C., talked to HANSA on how ship owners should and can comply Significant penalties by the US government make a detailed and functioning compliance system indispensable. What are the most important issues for ship owners? Jeanne Grasso: Most important is to understand and comply with the numerous federal and state requirements. Most dangerous for ship owners is not complying and trying to hide that non-compliance, whether intentional or when a mistake has happened. The first step should always be to identify any kind of noncompliance, develop a plan to come into compliance, take other corrective actions, document what was done, and, often, to disclose the plan and those actions to the US authorities. In the 25 years of my experience in maritime law this approach has always ended favourably. What is the major difference if ship owners are entering US waters compared to other countries in the case of noncompliance? Grasso: The US government is very serious about compliance worldwide and will prosecute inaccurate or false records (the cover-up) even if the pollution happens in international waters. I have not seen that in other countries. In fact, other countries commonly refer such cases to the US government. Even so, when you look at the number of ships that call on US ports in a year, the number of enforcement actions is relatively low. What exactly are the duties and responsibilities of the US Coast Guard (USCG) versus EPA (United States Environmental Protection Agency)? Grasso: The USCG is the port state control authority, which means that they are verifying compliance with international and federal requirements. The USCG and EPA work together if a particular issue is within EPA’s jurisdiction. Both entities have concluded on a Memorandum of Understanding in order to establish Jeanne Grasso, partner at the law firm Blank Rome in Washington D.C. © Blank Rome cooperation and coordination between them for implementing and enforcing, as an example, EPA’s Vessel General Permit (VGP) requirements on vessels. The VGP is one of the more important requirements in US environmental law, providing permit coverage for incidental discharges into waters of the United States from commercial vessels greater than 79 feet in length and for ballast water from commercial vessels of all sizes. It was first issued by EPA in 2008 and reissued in 2013 but was only effective until December last year. What is currently in place and what happens next? Grasso: EPA administratively extended the 2013 VGP indefinitely, so it remains in place. The reason is VIDA (Vessel Incidental Discharge Act), which was signed into law in December 2018. VIDA established a new framework for the regulation of incidental discharges under the Clean Water Act (CWA). EPA and the USCG, in consultation with the States, now must implement the law by setting standards for all incidental discharges and then developing regulations to implement and enforce those standards. This will take a long time, several years at best. The Emission Control Areas (ECAs) under MARPOL Annex VI (International Convention for the Prevention of Pollution from Ships) have become effective since 2015 already covering most of North America and allowing only fuel with a sulphur content of 0.1% or less. How is compliance enforced in the ECAs? Grasso: Enforcement is joint between the USCG and EPA. EPA is more focused on the fuel suppliers and fuel availability, whereas the USCG is focused on compliance and Port State Control inspections. Since the inception, we have seen about 80 deficiencies and over a dozen enforcement actions for failure to switch fuels before entering the ECA, failure to burn compliant fuel, and issues with records, especially if the USCG is not notified of the non-compliance. Civil penalties can be thousands of US Dollars per day, plus the economic gain. Do you have any recommendations for ship owners in order to avoid these kinds of penalties? Grasso: The ECA has been in place for more than four years now and compliance seems pretty stable. In order to avoid problems, however, I recommend having good procedures in place to switch fuel before the vessel gets to the boundaries of the 200nm zone, since this takes time. The other key is to properly plan voyages to have sufficient fuel on board going in and out that accounts for potential delays. Last but not least ship owners should make sure they have adequate capacity to store low sulfur fuel, which should include about a 25% cushion for delays. In case of noncompliance transparency is key, as Annex V requires owners to report fuel oil non-availability to the flag State and closest port State. How about the upcoming global sulphur cap of 0.5%, what will be the role of the USCG when effective in 2020? Grasso: Because the ECA is already in place, which requires 0.1%, the USCG 28 HANSA International Maritime Journal – 156. Jahrgang – 2019 – Nr. 3

Schifffahrt | Shipping will likely be focussed on the carriage ban and accurate record keeping. As such, if a ship does not have an exhaust gas cleaning system, there should be no reason to have high sulphur fuel aboard and I believe the USCG will be looking for this. Another key issue is the USCG regulation and its enforcement for ballast water management requirements. What should ship owners know? Grasso: Systems have been phased in over the past few years, but still seem to be a bit challenging to operate. Indispensable is a written contingency plan should the system not be working when coming to the US as the USCG will take this into consideration in determining whether to allow a vessel to discharge ballast water. This should include options such as not discharging ballast water, transferring ballast water to other tanks, discharging ashore or to a barge, discharging outside the twelve nautical miles zone, exchanging outside 200nm, and other options the ship owner can brainstorm. All theses options should be considered now and incorporated into the Ballast Water Management Plan. What is important when communicating with the USCG in case of difficulties concerning ballast water? Grasso: Ship owners should not fear talking to the USCG and recognize that they will need an approval regarding managing ballast water if the system is not operable. The reaction of the USCG will depend on many other factors: Is this the first time? Was the systems maintained and operated properly? Were there spares aboard? Has the crew been properly trained? Is there a plan to get the system operating again? It very much depends on the cooperation and in some cases the help of experienced lawyers for the interface may be helpful, depending on the facts. Do you have general recommendations? Grasso: Yes. First, ship owners should have a comprehensive environmental compliance program in place including detailed policies and procedures, training, audits, verification and visits to the ship, along with discussion with crew members of all levels. Second, there should be a hotline allowing crew to report anonymously to the company and detailed internal investigation procedures to deal with such reports. Third, if there are reports, the company must investigate and take corrective actions if necessary — and properly document these actions. And, finally, if there is an issue with the ship when coming to the US, it is almost always in the ship owner’s best interest to be transparent – identify the problem, the solutions, and the timing to the USCG. Depending on the seriousness of the issue, it may be prudent to coordinate those disclosures with experienced maritime counsel. Interview: Claudia Behrend Geballte Information: HANSA Surveys Die HANSA bekommt ein + HANSA International Maritime Journal – 156. Jahrgang – 2019 – Nr. 3 29

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