CircularsNews
July 2014

Situation in Ukraine Update 18.07.2014 - Kerch port

The European Union’s Emissions Trading System (EU ETS) was extended to cover emissions from shipping as of 1st January 2024.

The EU ETS is limited by a 'cap' on the number of emission allowances. Within the cap, companies receive or buy emission allowances, which they can trade as needed. The cap decreases every year, ensuring that total emissions fall.

Each allowance gives the holder the right to emit:

  • One tonne of carbon dioxide (CO2), or;
  • The equivalent amount of other powerful greenhouse gases, nitrous oxide (N2O) and perfluorocarbons (PFCs).
  • The price of one ton of CO2 allowance under the EU ETS has fluctuated between EUR 60 and almost EUR 100 in the past two years. The total cost of emissions will vary based on the cost of the allowance at the time of purchase, the vessel’s emissions profile and the total volume of voyages performed within the EU ETS area. The below is for illustration purposes:
  • ~A 30.000 GT passenger ship has total emissions of 20.000 tonnes in a reporting year, of which 9.000 are within the EU, 7.000 at berth within the EU and 4.000 are between the EU and an outside port. The average price of the allowance is EUR 75 per tonne. The total cost would be as follows:
  • ~~9.000 * EUR 75 = EUR 675.000
  • ~~7.000 * EUR 75 = EUR 525.000
  • ~~4.000 * EUR 75 * 50% = EUR 150.000
  • ~~Total = EUR 1.350.000 (of which 40% is payable in 2024)
  • For 2024, a 60% rebate is admitted to the vessels involved. However, this is reduced to 30% in 2025, before payment is due for 100% with effect from 2026.
  • Emissions reporting is done for each individual ship, where the ship submits their data to a verifier (such as a class society) which in turns allows the shipowner to issue a verified company emissions report. This report is then submitted to the administering authority, and it is this data that informs what emission allowances need to be surrendered to the authority.
  • The sanctions for non- compliance are severe, and in the case of a ship that has failed to comply with the monitoring and reporting obligations for two or more consecutive reporting periods, and where other enforcement measures have failed to ensure compliance, the competent authority of an EEA port of entry may issue an expulsion order. Where such a ship flies the flag of an EEA country and enters or is found in one of its ports, the country concerned will, after giving the opportunity to the company concerned to submit its observations, detain the ship until the company fulfils its monitoring and reporting obligations.
  • Per the EU’s Implementing Regulation, it is the Shipowner who remains ultimately responsible for complying with the EU ETS system.

There are a number of great resources on the regulatory and practical aspects of the system – none better than the EU’s own:

https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=CELEX%3A02003L0087-20230605

https://climate.ec.europa.eu/eu-action/transport/reducing-emissions-shipping-sector_en

https://climate.ec.europa.eu/eu-action/eu-emissions-trading-system-eu-ets/what-eu-ets_en

Sayin Ilgili,

Asagida çesitli kluplerin muhabirligini yapan Dias Marine time firmasindan alinan ve özellikle Kerch limani hakkinda bilgi içeren mesaji paylasmak isteriz.

In the war operations zone

Presently, the situation in the war operations zone is rather tense. Ukrainian national forces managed to take back many of the localities/settlements previously taken by the terrorists, among them Slavyansk and Kramatorsk towns, which for a long time remained under the terrorists’ control and were their centers of support in the east of the country. But this progress did not come easy - the fights became more fierce and bloody.  

Yesterday, in the area of Torez town within 50 km of the Ukrainian/Russian border a passenger liner “Boing 777” proceeding through the international air passage under the territory of Ukraine at a height of about 10 km, crashed down. There was launched an international investigation into the causes of the accident. Presumably, the airliner could have been brought down by “BUK” missiles system which use Russian army. The terrorists have such system and have already brought down Ukrainian military aircrafts.

Port of Kerch

These days we are getting many inquiries in respect of the loading operations in the port of Kerch. To help our Principals and their Members we would like to explain the situation. In Kerch loading of the cargo (grain, in particular) is carried out at the anchorage, far away from the shore. Ships at this anchorage do not get “free pratique”, in other words they are not cleared by the Immigration, Customs and Sanitary authorities. Thus, formally it is considered that they do not call Kerch port and do not enter the Crimean territory. At least neither port’s registries nor ships’ logs bear any official information/notes about any ships’ calls at the port. Such practice had developed long before the annexation of Crimea and was then explained, I believe, by mere commercial reasons as a ship at an anchorage does not have to pay any port dues/charges, which were always high in the Ukrainian ports.

To summarize what was said above we can conclude that for the present day the ships which were staying under loading operation at the anchorage of the Kerch port were not entered in the black-list of the Ukrainian authorities.  

VERY IMPORTANT

It should be borne in mind that the anchorage point of the Kerch port is about 4 miles from the shore. As per the Russian legislation a 12 miles zone is considered as territorial waters of the country. Formally, foreign ships may only be within this area in case of transit passage or proceeding to the port of loading/discharge. As Russia had annexed the Crimea its laws are now in force on this territory. Therefore, loading of the ships at an anchorage point of the port of Kerch is still effected within the territorial waters of Crimea as a part of the Russian Federation. Taking this into account one can arrive to a conclusion that there is still a possibility that the ships which are/were staying under loading operations at a Kerch anchorage may happen to be inserted into the said black-list as the situation in this regard is ambiguous and can be considered by the Ukrainian authorities in different ways.

Ukraine ‘closed’ Crimean ports - Update of the situation 18.07.2014

by Andrey Yanitskiy, partner of “Yanitskiy and Partners Law Firm’

Further to our notification of 9th July 2014, please be advised that the Directive ? 255 “On Closure of Sea Ports” was officially published and came into force on the 15th July, 2014. Accordingly, so far as the Ukrainian authorities are concerned, the ports of Evpatoria, Kerch, Sevastopol, Feodosia, and Yalta are de jure closed to international shipping. At that, as de facto the Crimea is beyond the control of Ukraine after it has been annexed by Russia it is unclear what practical effect this legislation will have on the operation of these ports, which, in fact, following the annexation in March 2014, operate under jurisdiction of Russia in the usual manner.  

However, vessels that call at the above ports after the Directive came into effect will be in breach of the Law of Ukraine No.1207-VII “On Assurance of Rights and Freedoms and Legal Regime on the Temporarily Occupied Territory of Ukraine” and if subsequently pursued by the Ukrainian law enforcement authorities, it may therefore result in penalties and/or criminal sanctions to be imposed on the master and/or crew members of any such vessel, as well as on the vessel d and/or officials of operator or owning company of the vessel.

Regards

Dias Marine Consulting (www.dias-co.com)

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