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Monday, April 23, 2018

INTERTANKO PRESENTATION AT THE LIBERIAN INTERNATIONAL SHIP AND CORPORATE REGISTRY (LISCR) ANNUAL MEETING WITH THE CLASS SOCIETIES

Erik Ranheim gave a presentation at the Liberian International Ship and Corporate Registry (LISCR) Annual Meeting with the Class Societies in Washington last week.  Mr. Ranheim presented the issues facing the tanker industry and gave an overview of the economics, the performance and the safety management system of the industry.   The tanker industry is still very fragmented, with tankers mainly operating in the spot market and with the clients being some of the largest companies in the world. Mr. Ranheim showed that both incidents and pollution from tankers have greatly declined over the last 10 years, and tankers have better port state control records than the rest of the shipping industry. At the same time tanker activity has increased strongly since 1985. Despite the improving performance single incidents, like Erika, lead to the perception that the quality management system of shipping has major shortcomings. 

Mr. Ranheim maintained that the maritime safety management system is often not fully understood, and he raised the following points:

 

  • The Flag is responsible for the statutory control, but has mainly delegated this control to Class. 
  • The Class societies are the only bodies with comprehensive expertise and an international contact network that regularly undertake quality controls. At the same time this leads to a possible conflict of interest since these controls are paid for by the owners.
  • The Port State has become an important element in the drive against substandard shipping. PSC is the body that through random checks verifies the condition of a ship between two Class surveys, but it cannot substitute the work done by Class.
  • The insurance industry, which originally established Class to do independent quality control, is now undertaking surveys themselves.
  • Tankers are additionally subject to oil companies’ vetting inspections, which might be burdensome and costly for owners but, on the other hand, tighten the control net. Thus a prudent owner would have a number of independent checks which supplement the Class control and he should then be able to document the quality of his operations.

Mr. Ranheim stressed that INTERTANKO strongly supports the flag and the Class system. INTERTANKO is, however, concerned that Certificates issued by Class are less and less accepted as evidence of the acknowledgement of a good standard. Whereas oil companies might need to do a risk assessment of the ships they may consider for charter, some of them go so far as to review the Class documentation and calculations from the Special Surveys.

Mr. Ranheim said that the industry players have been too inward-looking and urged Class to adapt and market their role in quality control to charterers and insurers.  He said that INTERTANKO has worked for more transparency in the industry for many years and that the traceability of actions and decisions is necessary to establish a credible marine safety management system.   INTERTANKO supports increased transparency and is currently working on the definition of the data that Class could release and the establishment of a proper mechanism for such a release.