North

Unfortunately a discrepancy has been found in Article 3.3 of the IG recommended contract wording that was annexed to the Group circular issued by Clubs in mid December.

The last sentence should read:

"This interim payment shall be remitted to the account appointed by Party B within 30 working days after Party B issues the invoice to Party A and such interim payment should be deducted from the final invoice."

Currently the text italicized above refers to Party B.

The updated and corrected contract can be accessed here.

03 January Update

CONSORTIA AGREEMENTS

We are advised that on 31 December China MSA approved the consortia agreement of Shanghai Resolve. The officially approved name of this Consortia is Yilian Oil Spill Emergency Treatment Consortia although it is understood that contracts on behalf of the consortia will be signed by Shanghai Resolve. The full listed of approved consortia can be found here.

CONTRACTING AGENTS

China MSA has now listed two agents as being approved for the purpose of signing contracts with SPROs on behalf of non-domiciled operators as follows:-

Qingdao Sunic-Ocean Marine Technology and Service Co., Ltd
Ningbo Qianhe Oil Spill Emergency Service Co., Ltd

31 December Update

1. CONSORTIA AGREEMENTS

China MSA yesterday published a list of approved consortia or “umbrella” agreements whereby operators will be permitted to contract with a single company representing a number of affiliated organisations providing coverage for multiple ports. There are currently only 4 approved consortia as follows:-

· Longshan Marine Pollution and Emergency Treatment Consortia

· Qianhe Marine Oil Pollution Protection Consortia

· China Jufeng Marine Pollution and Emergency Treatment Consortia

· Orient Marine Pollution Protection Consortia

A spreadsheet listing all of the affiliated companies for each of these consortia can be found here.

We understand that Shanghai Resolve is not yet approved as a consortia by the MSA.

OSRO China based in Hong Kong is not an approved consortia but is offering services to facilitate contracting with individual SPROs in various ports apparently on a standard contract and at standard response tariff rates.

2. MSA REGIONAL UPDATE

We have received over night a number of updates on the position in individual MSA regions as follows:-

Ningbo:

We have heard that the Ningbo MSA announced yesterday that they will delay enforcement of the SPRO agreement requirements until 1 Feb 2012. However, there has been no official circular to support this news as yet.

Zhoushan:

We have also heard that there may be a postponement of the requirements in Zhoushan, but this is also yet to be confirmed.

Yingkou:

There is only one SPRO approved for Yingkou port but it is not a level 1 SPRO. A notice issued by Yingkou port identifying the procedure to be followed by vessels requiring Level 1 coverage for Yingkou may be accessed here.

CONTRACTING AGENTS

So far as we are aware there are still no approved agents for the purpose of signing SPRO contracts on behalf of operators. Members are referred to our update of 29 December for further comment.

29 December Update

The situation continues to evolve and in a further development the International Group has received verbal indication from MSA Beijing that overseas operators will be allowed to contract directly with approved SPROs. This is contrary to earlier advice received by the IG and included in our industry news item of the 23^rd December.

Additionally both Shanghai MSA and Liaoning MSA have issued written notices stating that overseas operators will be allowed to contract directly with approved SPROs.

We understand that no agents in China have received approval from the MSA to act as agents for the purposes of signing contracts with SPROs on behalf of vessel operators. In the circumstances, whilst companies such as Huatai and China Marine Services may be of assistance in arranging contracts with appropriate SPROs we understand that for operators without an office in China the contract will have to be signed by the operator or the vessel master.

Members are referred to the Association's circular 2011/041 of 06 December 2011.

Matters have been developing significantly and rapidly in China over the past two weeks. The International Group have been liaising with many organisations in order to clarify a number of issues and to work towards ensuring, so far as possible, that there are suitable contractual arrangements in place to permit members to be able to comply with the Regulations as easily and efficiently as possible. A set of Frequently Asked Questions (FAQs) has been prepared to incorporate known developments up to 22 December.

Click here for the FAQ's, these will be updated as appropriate with further developments when known.

Whilst the FAQs deal with the issues in some detail the most significant issues of concern to members are as follows:-

A number of organisations have now entered into alliances with a single company taking the lead. The Association is currently aware of four such organisations in mainland China as follows:-

Jufeng

Longshan

Qianhe

Shanghai Resolve Shengmin

In addition OSRO China based in Hong Kong are also offering a service to facilitate an alliance of SPROs in China.

Although the requirement is that vessel operators should have contracts with SPROs for each of the ports to be visited by a vessel China MSA have now confirmed that they will, subject to the lead SPRO meeting certain requirements, accept that operators sign a contract with only the lead SPRO.
There have been some suggestions over the past week that operators not domiciled in China would be permitted to contract directly with SPROs without use of an agent in China. However, the latest notice published by China MSA on 22 December makes it clear that an agent in China will have to be employed for the purposes of signing contracts with individual SPROs. It is unclear from the notice whether this requirement applies to contracting with a lead organisation acting on behalf of an alliance of SPROs and the International Group is seeking clarification on this point. In the meantime members that are currently in discussion with lead organisations are recommended to raise the issue with them and ask them to seek clarification from China MSA directly.
The Association is aware of only two organisations that are offering agency services specifically related to the requirements of the regulations as follows:-

Huatai Insurance Agency

China Marine Services

China MSA have indicated that there will be no deferral of the implementation date for the regulations from 1 January 2012 for ports that have approved SPROs. However, if an operator is unable to finalise a contract with an SPRO in these ports before arrival of a vessel the MSA may permit entry of that vessel subject to operators providing an explanation to the MSA in advance of arrival as to why it has not been able to conclude a contract. If a vessel is permitted entry in these circumstances a contract will have to be concluded before the vessel departs the port.

The above points are a summary of the main issues and members are referred to the FAQs for more detailed information.

As the situation is continuing to evolve the Association will endeavour to post updates on Industry News.

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Regulations of the People's Republic of China on the Prevention and Control of Marine Pollution from Ships - UPDATE

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Monday, 20th February 2012

03 January Update

CONSORTIA AGREEMENTS

1. CONSORTIA AGREEMENTS