Ma­jor chal­lenges fol­low­ing BWM rat­i­fi­ca­tion

Financial Mirror (Cyprus) - - FRONT PAGE -

It has been a long time com­ing, but re­cent ac­ces­sion by Fin­land has trig­gered the en­try into force of the In­ter­na­tional Con­ven­tion for the Con­trol and Man­age­ment of Ships’ Bal­last Wa­ter and Sed­i­ments (BWM) con­ven­tion.

The con­ven­tion will en­ter into force on 8 Septem­ber 2017, by which date ves­sels will be re­quired to have a bal­last wa­ter man­age­ment sys­tem in place, or have one retro­fit­ted at the time of the ves­sel’s first dry­dock­ing there­after. How­ever, it should be noted that dis­cus­sion con­tin­ues about some of the prac­ti­cal de­tails of im­ple­men­ta­tion.

Un­der the con­ven­tion, ships in in­ter­na­tional trade will be re­quired to man­age their bal­last wa­ter and sed­i­ments to cer­tain stan­dards, ac­cord­ing to a ship-spe­cific bal­last wa­ter man­age­ment plan. The bal­last wa­ter per­for­mance stan­dard will be phased in over a pe­riod of time. Most ships will need to in­stall an on­board sys­tem to treat bal­last wa­ter and elim­i­nate un­wanted or­gan­isms.

Shipown­ers and op­er­a­tors, mean­while, still face un­cer­tainty about which sys­tems to in­stall, with more than sixty ty­peap­proved ver­sions on the mar­ket. And while many have al­ready in­stalled sys­tems on their ves­sels, none of th­ese has re­ceived US Coast Guard ap­proval. It has been ar­gued that the en­try into force of the BWM con­ven­tion could have a pos­i­tive ef­fect on over­ton­nag­ing, with many older ves­sels deemed not to war­rant the cost of up­grad­ing.

Mean­while, the po­ten­tial cost and fi­nanc­ing chal­lenge rep­re­sented by BWM com­pli­ance is enormous, although the ac­count­ing should be more straight­for­ward. Ini­tial in­stal­la­tion, in­clud­ing retro­fit, will be treated as cap­i­tal ex­pen­di­ture, while on­go­ing op­er­a­tion will be an op­er­at­ing cost. In ad­di­tion, the i mpact on ves­sel i mpair­ment as­sess­ments must not be over­looked. It is es­sen­tial that those af­fected by the new leg­is­la­tion un­der­stand ex­actly what is re­quired of them by what date.

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