Tidal wave of maritime regulations will make world shipping more onerous and costly
 Unless Elon's Musketeers come to the rescue, a tidal wave of costly, burdensome regulations will hit the maritime sector before the year is out.
They range from highly-complex compliance challenges to strict environmental performance mandates, new security and safety rules and higher levels of greenhouse gas emission reductions.
Writing in America's Maritime Executive magazine, Stamatis Fradelos, vice president - regulatory affairs at the American Bureau of Shipping, explains how operators can navigate through the difficulties ahead.
The UN's International Maritime Organisation (IMO) has been publishing regulations for five years. They can be broken down into environmental protection and safety on the use of alternative fuels, plus new cybersecurity protocols.
The recent digitisation of ships, combined with growing geopolitical tensions, have identified 64 cyber incidents targeting maritime organisations in 2023, according to the Netherlands’ NHL Stenden University of Applied Sciences. A decade earlier, there were only three.
The average a cyberattack costs the target organisation US$550,000 – up from $182,000 in 2022. Demands for ransom have increased by more than 350 per cent, with the average ransom payment at $3.2 million in 2023 - up from $3.1 million the previous year.
In response, the IMO has published new safety standards, including a focus on improving crew training, implementing new technologies, and ensuring that international regulations keep pace with innovations such as autonomous shipping.
"To reduce CO2 emissions per transport work, as an average across international shipping, by at least 40 per cent by 2030, compared to 2008 zero or near-zero GHG emission technologies, will be mandates together with fuels and/or energy sources to represent at least five per cent, striving for 10 per cent, of the energy used by international shipping by 2030," said Mr Fradelos.
That means reducing GHG emissions from international shipping compared to 2008 by 20 per cent, striving for 30 per cent by 2030 and by 70 per cent, then striving for 80 per cent by 2040 and reaching net zero by 2050.
The IMO’s Marine Environmental Protection Committee (MEPC) is expected to finalize and approve a series of short to mid-term measures that will underpin these ambitious environmental targets by April, with an anticipated roll-out by 2027.
One element will likely focus on the measurement of the ship’s GHG intensity on a Well-to-Wake basis per energy consumed on board - the GHG Fuel Standard (GFS) - combined with a phased reduction of the GHG Fuel Intensity (GFI) over time. This equation will relate to a possible correction factor for ships serving ports of developing countries.
Furthermore, there are plans to attach a price to carbon dioxide (CO2) emissions to incentivize shipowners and operators to reduce emissions by selecting cleaner fuels such as synthetic fuels derived from renewable sources, as well as adopting energy-efficient technologies.
"We can also expect an increased governance of the fund under the IMO’s remit. This emphasizes the need for transparency, accountability and good governance of revenue management, and a balanced geographical representativeness of its membership," said Mr Fradelos.
In line with the international agenda to safeguard shipping and port companies from bad actors online, The Vessel Cyber Risk Management Work Instruction provides guidance on the United States Coast Guard's approach to assessing cyber risk in commercial vessels.
Mr Fradelos says it outlines expectations for US-flagged vessels and companies to integrate cyber risk management into their Safety Management Systems. Furthermore, foreign-flagged vessels calling at US ports must have adequately addressed cyber risk management in their systems.
Additionally, an executive order signed in February 2024 mandates that cyber threats be addressed through updates to Part 6 of Title 33 of the Code of Federal Regulations, which includes cybersecurity protocol. The executive order defines a "cyber incident" and establishes reporting requirements for them. This reporting requirement also applies to foreign-flagged vessels operating in US waters.
Furthermore, the USCG has taken steps to update its maritime security regulations. This proposed rule would introduce several requirements for owners or operators of US-flagged vessels, facilities and Outer Continental Shelf facilities. It would mandate the implementation of cybersecurity measures aimed at identifying risks, detecting threats and vulnerabilities, protecting critical systems, and facilitating recovery from cyber incidents.
October 2024 saw the US Environmental Protection Agency publish its final rule under the Vessel Incidental Discharge Act (VIDA). It established federal performance standards for marine pollution control devices applicable to discharges into US waters and the contiguous zone.
The USCG is required to develop corresponding implementation, compliance and enforcement regulations within two years. These regulations may include requirements for the design, construction, testing, approval, installation and use of devices necessary to meet the EPA standards.
The EPA’s rule took effect on November 2024; however, the federal standards will only become enforceable once the USCG finalises its regulations. Until then, existing requirements from the 2013 Vessel General Permit and the USCG’s requirements under section 1101 of the Nonindigenous Aquatic Nuisance Prevention and Control Act (VIDA) will remain in effect.
Two types of standards have been established under VIDA. The general standards are organised into these three categories:
On biofouling management, the specific standards address discharges of 20 different pieces of equipment and systems. The new requirements are at least as stringent as those before. We can expect these to transition into regulation that reflect national technology-based standards of performance, improve clarity, enhance enforceability and implementation, and incorporate new information and technology.
The California Air Resource Board's (CARB) At-Berth Regulation now kicks in. Vessels visiting California must now report each visit within 30 days of departure and meet opacity requirements. Emissions controls compliance will also take effect.
Two years ago, container and refrigerated cargo vessels, as well as passenger cruise vessels were required to comply with these controls, while roll-on/roll-off vessels and tanker vessels that visit the Ports of Los Angeles or Long Beach are now following the requirements as of January 2025, and finally, all remaining tanker vessels must comply by January 2027.
As well as communicating with the regulated terminal at least seven days prior to arrival, the vessels must comply by reducing emissions while at the terminal. This could mean connecting to shore power, employing a CARB-approved Emission Control Strategy (CAECS) or an approved innovative concept within two hours of the vessel arriving at the berth, continuing on until one hour before the pilot boards the vessel for departure.
Still, uncertainty remains as the IMO, and country-specific regulators, work towards finalising these safety and environmental policies.
Advises Mr Fradelos: "Maritime and shipping organizations should take a proactive approach to prepare for compliance by building their awareness of new regulations on the horizon. Awareness will help them to steer a smooth course to compliance in the long-term. The ABS Regulatory updated guidance to help navigate the regulatory landscape. |
