The Final Countdown: Will Shipping Play by the Rules?

In a recent article for the shipping industry magazine Bunkerspot, firm Principal J. Stephen Simms analyzes the responsibility of marine fuel suppliers to affirmatively engage to assure that the fuel that they sell is MARPOL compliant. Suppliers should be aware that attempts to impose the duty entirely on their customers to ensure that the marine fuel they had received had a Sulphur content meeting MARPOL requirements could potentially result criminal prosecution or civil liability, as governments soon will bring more prosecutions of bunker suppliers selling non-MARPOL compliant fuel. Although, historically, government prosecutions have been limited to vessel owners or charterers, many nations have recently ratified MARPOL VI Annex Regulation 18, which calls for regulation and enforcement actions against bunker suppliers. In short, this means that from 1 January 2015, vessel charterers, owners and operators operating in emission control areas will be required to use marine fuel with only 0.10% Sulphur content. Realistically, this presents a challenge to many fuel suppliers given that many ports lack readily available low Sulphur fuel. In the event that the vessel cannot obtain MARPOL compliant fuel, the Environmental Protection Agency (EPA) requires the filing of a Fuel Oil Non-Ability Report (“FONAR”). However, fuel suppliers must exercise extreme caution when completing a FONAR, because if the fuel quality is not correctly reported in the FONAR, the vessel operator also can be liable in damages for a false statement to the United States government.

The US law implementing MARPOL, the International Convention for the Prevention of Pollution from Ships, and its Annex VI, is the Act for Prevention of Pollution by Ships (APPS). The penalties for violations of the AAPS can be up to $25,000 for each violation and up to $5,000 for each false statement or representation. Additionally, under APPS, vessels violating the MARPOL protocol may be liable in rem and subject to arrest for the amount of any criminal fine or administrative penalty.

For more information on how fuel suppliers can protect themselves and ensure compliance with MARPOL fuel requirements, a PDF version of the full article is available here.