The Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (HKC) will come into full force on 26 June, 2025 after it was ratified by Bangladesh and Liberia. Maren Schroeder, Managing Director of Stolt Tankers, considers whether this will end – or at least remove – some of the current confusion...
The HKC was first adopted by the International Maritime Organization (IMO) and 63 countries in 2009, but it has not been enforceable because it had not been ratified by enough countries. Until now.
Bangladesh (as a recycling destination) and Liberia (as an essential fleet-size country) coming onboard recently was a very welcome step as the regulatory landscape for recycling has been unclear. As has often been the case when it feels the IMO is too slow, the EU introduced its own framework in 2013: the EU Ship Recycling Regulation (EU SRR).
Since 2020, it has been fully applicable to EU-flagged ships, including having to recycle these ships at EU-whitelisted recycling facilities. Non-EU ships in EU waters must also comply, but do not necessarily have to be recycled in an EU-approved facility.
However, we also have the Basel Convention and the Basel Ban Amendment, which are UN directives, applicable to all ships operating in OECD territories. The Organisation for Economic Co-operation and Development (OECD) has 38 member countries around the world, the majority of which are in Europe.
"Insisting that only European and US yards have the capability to recycle correctly, is a narrow view of the recycling industry and not at all in keeping with the global nature of shipping."
The regulations, which have been agreed by more than 190 countries, were designed to reduce the movement of hazardous waste between nations, specifically from developed to less developed countries. One stipulation is that a ship operating in an OECD country cannot go to a recycling facility outside of the OECD.
It’s not surprising that it is often unclear which of the many overlapping regulations apply. In addition to this, some countries don’t have a framework in place for managing compliance with the administrative requirements of the Basel Convention and Ban Amendment, making it difficult to adhere to the regulations from a practical perspective.
The resulting confusion is reflected in the maritime press. We hear of increasing numbers of shipping companies and their directors being prosecuted, mostly for not recycling ships in EU yards as required under the EU SRR, or for not having the right papers in place as stipulated under the Basel Convention.
It is possible that some companies knowingly violate the regulations. However, some may simply be making honest mistakes, thinking they are complying with the rules. Or, worst case, they actually do comply with all the rules, but the regulators are as confused as they are about how to check them. This confusion has led to some costly and lengthy investigations, many of which have eventually been dropped after several years.
What happens now?
When it introduced the EU SRR, the EU promised to abolish it once the HKC came into force. Today, delivering on this promise seems uncertain and there is even talk of the potential to expand the reach of the EU regulations, which is a shame.
It would be a very welcome development to remove one regulation from the regulatory jungle, not least because the EU SRR’s requirement that EU-flagged ships must be recycled in EU-approved yards is particularly challenging.
There are 48 yards on the current list, 47 of which are in Europe (EU, Turkey, UK and Norway) and one is in the US. On paper, they have more than enough recycling capacity. However, when taking a closer look, many of these yards are repair yards and – although they could theoretically do the job – they have no interest in clogging up their premises with ships for recycling.
"Having three overlapping, complex regulations in place only creates confusion and requires a lot of time and resources to monitor the different levels of compliance."
At the same time, many yards around the world have seriously upped their standards in line with the requirements set out in the HKC and even with the slightly stricter European standards. Many of them are experts in recycling, dedicated to this task and comply with the regulations.
Insisting that only European and US yards have the capability to recycle correctly, is a narrow view of the recycling industry and not at all in keeping with the global nature of shipping. For instance, the yards we use outside of the EU reuse significantly more of the ships' materials than is required under the EU regulations.
The Stolt Tankers approach
For many years, Stolt Tankers has been recycling its ships in compliance with the applicable rules and regulations and we are a founding member of the Ship Recycling Transparency Initiative (SRTI). This online platform was jointly developed by key industry stakeholders to encourage shipowners to share their ship recycling policies. It offers stakeholders access to information on different companies’ approaches, enabling them to make informed decisions when choosing their shipping partners.
Stolt Tankers recycles its ships in shipbreaking yards around the world that have achieved certification for compliance with HKC and in line with EU standards and which maintain a high level of safety and environmental performance. For example, the Shree Ram Group’s plots 78/81 and V7, used by Stolt Tankers, became the first in India to receive certification from Lloyd’s Register Asia confirming they comply with Article 13 of EU Regulation 1257/2013.
Clearing the jungle
Responsible shipowners want to comply with regulations and do what is right from an environmental and safety perspective. However, having three overlapping, complex regulations in place only creates confusion and requires a lot of time and resources to monitor the different levels of compliance.
Shipping is a global business – having to deal with the local regulations of 190 countries does not make any sense, which is why we have the IMO. Now that its HKC – an international convention – has been ratified and will become fully enforceable in 2025 (after the mandatory two-year waiting period), we believe that it is time to move to a single, global standard for safe and sustainable ship recycling.
To establish a clear path and consistent compliance-management framework for all operators, the EU SRR, and the applicability of the Basel Convention and Basel Ban Amendment for shipping should be phased out to make way for one clear and concise standard.