The Board of Directors of the International Chamber of Shipping (ICS) representing national shipowners’ associations from the Americas, Asia and Europe met in London last week. Issues discussed included the development by the International Maritime Organization (IMO) of a global mechanism for the Monitoring; Reporting and Verification (MRV) of CO2 emissions; the entry into force of the International Labour Organization (ILO) Maritime Labour Convention (MLC); and ICS’s response with respect to important changes to global accounting rules being proposed by the International Accounting Standards Board (IASB).
CO2 Monitoring, Reporting and Verification (MRV)
The ICS Board reiterated ICS support for the development of a global system of MRV at IMO, provided that the mechanism is simple to administer, primarily based on fuel consumption and bunker delivery notes, and that the system itself will not be used for the development of a full blown Market Based Measure or a mandatory system of energy indexing for existing ships. The ICS Board agreed that it will respond constructively to the proposal that has been submitted to IMO by the United States and which needs to be debated by all IMO Member States at the next meeting of the Marine Environment Protection Committee in April.
However, ICS Chairman, Masamichi Morooka, remarked that “ICS is very concerned by the recent proposal by the European Commission, to be put before the European Parliament, for a Regulation mandating a regional system of MRV. While the Commission has stated that it would prefer to see the development of a global system by IMO, we are unclear whether the Commission is sincere in its intentions or how the development of a regional mechanism, which also seems overly complex, can be reconciled with what we hope can be developed and adopted internationally.”
Mr Morooka explained: “We agreed the immediate priority for ICS is to prepare a global industry position that can be taken by shipowners to IMO. In order to support the maintenance of a global regulatory framework and the development of a mechanism that is acceptable to international shipping we want to help IMO make progress on MRV.”
He added: “Our members firmly believe that it is possible for IMO to develop a robust system of MRV whilst meeting the concerns of those developing nations that do not wish to compromise their positions at the high level climate change talks” in the context of the United Nations Framework Convention on Climate Change (UNFCCC). In co-operation with ICS’s Regional Partner, the European Community Shipowners’ Associations (ECSA), ICS is also preparing detailed comments on the European Commission’s proposals, so that EU Member States will be clear where shipowners stand.
ILO Maritime Labour Convention
The ICS Board expressed satisfaction with the entry into force of the ILO MLC, noting that ICS had co-ordinated the employers’ group at the ILO diplomatic conference which adopted the new Convention in 2006. While the IMO Secretary-General, Mr Koji Sekimizu, was again opening the ICS International Shipping Conference with a keynote speech, it was noted that the presence of the ILO Director General, Mr Guy Ryder, was also a great honour, signifying the importance of the ILO MLC and the model that it provides for other industrial sectors for the promotion of decent employment standards at the international level.
It was agreed that through its member national associations ICS would remain in close contact with Port State Control authorities around the world in order to avoid misunderstandings that might arise during the initial stages of enforcement. ICS urged governments to take a pragmatic approach towards the enforcement of what were complicated new certification requirements until August 2014, in line with a Resolution adopted by the ILO Conference in 2006.
The ICS Board commended the advice that ICS has prepared for ship operators to help encourage compliance, and emphasised the vital need for ship operators to prepare a Declaration of Maritime Labour Compliance (DMLC) as required by the ILO Convention – see www.ics-shipping.org/ilo-mlc
International Accounting Standards
The ICS Board endorsed the position adopted by the ICS Maritime Law Committee with respect to the latest draft of the new international accounting standards proposed by the International Accounting Standards Board (IASB). It was agreed that ICS would continue to oppose the notion that operational arrangements such as time charters should be treated as financial leases for accounting purposes and that ICS would press for further clarity from the IASB with respect to the new definitions being proposed.
The ICS Board agreed that it was most important that national ship owner associations presented the IASB with consistent messages on this issue in dialogue with their national accounting authorities and with auditing firms. ICS will be submitting its final comments to the IASB within the next few days.