Trident Alliance responds to Indonesian threats on IMO2020 low sulphur fuel policy.

Indonesian authorities' reported intention not to enforce the rule on all shipping activities runs counter to health, environmental and fair competition interests.

The entry into force date of the new global sulphur cap is set in stone. From 1 January 2020 the maximum sulphur content of fuel consumed on the high seas will be 0.50%, unless an exhaust gas cleaning system is used. Due to compliance cost, The Trident Alliance believes it is essential for authorities to fully and effectively enforce the regulations if fair competition is to be maintained, and to protect health and environmental interests.

Trident Alliance Chair, Roger Strevens, says: “The only surefire way to successfully implement the new global sulphur cap is follow the regulations to the letter. Any local deviations from this would create unfair competition and may lead to non-compliance on a wider scale. Furthermore, it is extremely unhelpful to make such decisions so late in the day given the expense and effort the industry has already expended in preparing”

Shipping is a global industry and therefore benefits from a global regulatory approach. For the new sulphur cap it is also vital to have effective enforcement worldwide due to the high compliance cost and because there are no hard boundaries between domestic and international shipping. Vessels in international trade can compete with those operating in domestic trades on some voyage legs. Internationally trading vessels that commit a violation within Indonesian waters could be sanctioned for it by other port states at a later point in their voyage, hence they could not revert to the older and cheaper 3.50%S level.

Aside from the unfair distortion to the competitive landscape, it is unclear how a failure or refusal to enforce the new sulphur cap would not expose a state to legal consequences. States, such as Indonesia, that are party to IMO’s MARPOL Annex VI do not have the facility to exempt merchant vessels from compliance. Additionally, states party to Annex 6 can be held liable for non-enforcement by the other states that are party to it.

In view of the foregoing, Strevens continues: “The Trident Alliance strongly urges any state contemplating partial enforcement to reconsider in favour of the only approach that makes lasting sense on a moral, legal and business basis; full and effective enforcement.”

The entry into force date of the new global sulphur cap is set in stone. From 1 January 2020 the maximum sulphur content of fuel consumed on the high seas will be 0.50%, unless an exhaust gas cleaning system is used. Due to compliance costs the Trident Alliance believes it is essential for authorities to fully and effectively enforce the regulations if fair competition is to be maintained, and to protect health and environmental interests.

Strevens says “The only surefire way to successfully implement the new global sulphur cap is follow the regulations to the letter. Any local deviations from this would create unfair competition and may lead to non-compliance on a wider scale. Furthermore, it is extremely unhelpful to make such decisions so late in the day given the expense and effort the industry has already expended in preparing.”

Shipping is a global industry and therefore benefits from a global regulatory approach. For the new sulphur cap it is also vital to have effective enforcement worldwide due to the high compliance cost and because there are no hard boundaries between domestic and international shipping. Vessels in international trade can compete with those operating in domestic trades on some voyage legs. Internationally trading vessels that commit a violation within Indonesian waters could be sanctioned for it by other port states at a later point in their voyage, hence they could not revert to the older and cheaper 3.50%S level.

Aside from the unfair distortion to the competitive landscape, it is unclear how a failure or refusal to enforce the new sulphur cap would not expose a state to legal consequences. States, such as Indonesia, that are party to IMO’s MARPOL Annex VI do not have the facility to exempt merchant vessels from compliance. Additionally, states party to Annex 6 can be held liable for non-enforcement by the other states that are party to it.