Ironing out ship recycling wrinkles

The IMO’s Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships 2009 (Hong Kong Convention) will enter into force on June 26, 2025.

Whilst the ratification of the Hong Kong Convention is a positive development and brings the industry one step closer to responsible ship recycling, a concern has arisen that its requirements potentially conflict with those under the UN’s Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal 1989 (Basel Convention) and the Ban Amendment to the Basel Convention.

In advance, therefore, of the forthcoming meeting of the IMO’s Marine Environment Protection Committee (MEPC) March 18-22, 2022 (MEPC 81), BIMCO and others have submitted a joint paper asking the MEPC to consider any legal inconsistencies between the two Conventions and to take any action necessary to provide the industry with certainty in this regard.

Conventions and regulations

The Basel Convention came into force in 1992 and regulates the transboundary movements of hazardous wastes and obliges its parties to ensure that such wastes are managed and disposed of in an environmentally sound manner. As at February 2023, it has 191 parties and 53 signatories. The Basel Convention is not shipping-specific but will also apply to ship wastes. Compliance with the Basel Convention is on the state of export (where the ship commences its voyage on its way to being recycled), on any transit state and on the recycling state.

The Ban Amendment to the Basel Convention entered into force in December 2019 and prohibits hazardous waste exports from OECD and EU Member States, as well as Liechtenstein, to primarily non-OECD and developing countries. As at February 2023, 103 of the parties to the Basel Convention had indicated their consent to be bound by the Ban Amendment.

The EU Waste Shipment Regulation transposes the Basel Convention into EU law by setting out requirements for shipping waste within, to and from the EU. The Regulation specifies the procedure for shipping waste according to the destination, the nature of the waste and the way in which the waste will be processed after shipment.

The EU Waste Shipment Regulation has been largely replaced by the EU Ship Recycling Regulation that came into force in 2018. The Recycling Regulation applies to vessels with an EU flag and requires those vessels to be recycled only in yards included in the European List of ship recycling facilities. Broadly, the EU Ship Regulation reflects the requirements of the Hong Kong Convention but with additional health and safety standards and environmental requirements. The Waste Regulation remains applicable to any non-EU flagged ship that sails from an EU port for recycling.

The Hong Convention applies to ships flagged in contracting states, of which there are 24 as at February 2024. Responsibility for ensuring compliance with the Hong Kong Convention is on the relevant national authorities in the flag State.

Ships must carry an Inventory of Hazardous Materials (IHM) and can only be recycled at authorised facilities. Recycling facilities located in contracting states, must be authorised by the national authorities. The facilities are required to have in place a Ship Recycling Facility Plan (SRFP) and must also develop a Ship-Specific Recycling Plan (SRP) for each ship to be recycled.

What are the concerns?

Some of the signatories to the Hong Kong Convention are not OECD nations. Query, therefore, whether a ship may be authorised for recycling under the Hong Kong Convention and obtain an International Ready for Recycling Certificate (IRRC) but still be considered a hazardous waste under the Basel Convention/Ban Amendment. An IRRC is valid for up to three months and, according to BIMCO’s submissions to the MEPC, a ship could therefore run the risk of being arrested during those three months while trading lawfully because it is considered to have breached the Basel Convention requirements.

There are differing views as to whether export of a ship to a yard in a non-OECD country that is authorised under the Hong Kong Convention or that is on the EU List of approved ship recycling facilities will not infringe the Basel Convention/Ban Amendment insofar as the Hong Kong Convention and the EU Ship Recycling Regulation impose environmentally sound waste standards that equate with those set out in the Basel Convention. Among other things, not everyone is agreed on whether the Hong Kong Convention imposes requirements that are at least equivalent to those in the Basel Convention.

Furthermore, as things stand, the requirements for certifying recycling yards under the Hong Kong Convention and the Recycling Regulation are not entirely the same. The Regulation is currently being reviewed with a view to ensuring that its requirements align with those under the Hong Kong Convention. However, the current lack of uniformity/clarity is unhelpful.

Addressing concerns

A proposed amendment to the EU Waste Shipment Regulation has been agreed in principle and awaits formal adoption by the EU Parliament and Council. Essentially, the amendment permits the export of hazardous waste, including ship waste, to non-OECD countries if the recycling facility can document sustainable management and disposal practices and procedures in accordance with EU regulations. The documentation would then allow that facility to be included on the EU List.

The proposed amendment should be seen in the light of reports that a number of non-OECD yards have upgraded their facilities in order to obtain approval for inclusion on the EU List, with some of those yards having already undergone preliminary audits for compliance. The concern so far has been that the Ban Amendment may hinder their inclusion on the List. However, the amendment will only impact ships that are being shipped from or via the EU.

BIMCO has acted in conjunction with the International Chamber of Shipping, as well as Bangladesh, India, Norway and Pakistan. Their submission to the MEPC ahead of the forthcoming meeting seeks assurance that those complying with the requirements of the Hong Kong Convention will not be penalised for any contravention of the Basel Convention/Ban Amendment.

The BIMCO document states that, as both the Hong Kong Convention and the Basel Convention can apply to end-of-life ships, shipowners risk prosecution in situations where they have sent their ships to be responsibly recycled at yards that comply with the Hong Kong Convention in one of the four major recycling states, namely Bangladesh, India, Pakistan and Turkey (all non-OECD states). This situation is deemed not acceptable after the Hong Kong Convention comes into force.

The document highlights that the Hong Kong Convention is intended to be a ‘one stop shop’ for responsible ship recycling and that the world fleet should operate on a level playing field. Some of the inconsistencies between the Conventions are attributed to the fact that the Basel Convention is not aimed solely at ship waste and does not operate along flag State lines.

Given, as BIMCO highlights, that the IMO is calling for as many states as possible to ratify the Hong Kong Convention, it seems sensible for these and other concerns to be addressed before it comes into force.

Additionally, the parties to the Basel Convention are scheduled to meet in April/May 2025. It will be interesting to see whether any of these issues will be dealt with by MEPC81 or whether the issues will still form part of the agenda for the Basel Convention meeting.
Source: hellenicshippingnews