Shipping heavyweights hit out at BIMCO’s CII clause

Monday, 13 March 2023

Heavyweight shipowners and charterers, including Mediterranean Shipping Company (MSC), A.P. Moller – Maersk, Oldendorff Carriers, Trafigura and Vitol, have strongly criticised BIMCO’s Carbon Intensity Indicator (CII) operations clause, which makes charterers contractually responsible for the CII performance of their hired ships.

New regulations on the carbon intensity of international shipping will come into force on January 1 and are expected to significantly impact the future operation of ships. Under the BIMCO CII clause, charterers take on the obligation of ensuring the vessel achieves an agreed gCO₂/dwt.nmile in accordance with the MARPOL CII calculation by the conclusion of the relevant calendar year or redelivery, if sooner.

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In an open letter to the Copenhagen-based shipping industry organisation a group of 23 signatories, said that shifting CII requirements disproportionately to charterers was detrimental to achieving a good outcome for each individual vessel and that it removed the important incentive for owners to do their fair share for decarbonisation efforts and failed to recognise that owners are primarily responsible under the IMO regulations.

The group acknowledged BIMCO’s efforts and time spent to adopt the clause but said that it “fell short of expectations”, noting that key provisions that were proposed, such as vessel performance and maintenance, were not accepted in the final text. The BIMCO clause was described as “imbalanced” and “unusable,” which will “likely lead to a wide variety of “homegrown” CII clauses or – to the owners’ detriment – no clause being agreed.”

The charterers added they would not “shy away” from their role in commercially operating the vessel and complying with the CII regulations, but stressed that owners remain equally responsible for maintaining the vessel’s operating efficiency, technical operations, navigation, insurance, crew, and all other related matters.

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“In circumstances where charterers’ employment orders are only partly responsible for the CII rating, this group does not accept taking wholesale responsibility for compliance with the regulations. This has been one of the biggest sticking points in the discussions,” the signatories said in the letter, adding that they would work to develop alternative CII clauses that “fairly share the responsibility for the journey towards decarbonisation between owners and charterers.”

Other signatories are CMA CGM, Hapag-Lloyd, Norden, Wallenius Wilhelmsen, Stena Bulk, COFCO, Clearlake Shipping, Bunge, ADMIntermare, Mercuria Shipping, Panagaea Logistics, Nordic Bulk Carriers, Americas Bulk Transport, Phoenix Bulk Carriers, Engelhart, Unifeeder, Louis Dreyfus and Amaggi.

Source : https://splash247.com