6 February 2014 - A total of 40 ships previously owned or controlled by Norwegian interests were recycled in 2013, of which 21 were beached in Pakistan, India or Bangladesh, areas that are characterized by extremely dangerous working conditions and significant environmental exposure to asbestos, heavy metals and Polychlorinated biphenyls, or PCBs.
The number of Norwegian controlled ships dumped in these Southeast Asian countries, however, did fall from the previous year’s figure of 37
“It is long overdue for the Norwegian Shipowners Association to tighten their recommendations to members,” says Svend Soeyland, Senior Advisor with the Bellona Foundation. “Today, members are advised to avoid Bangladesh and are encouraged to use breaking yards in China. The logical next step is to also shy away from beaching in Pakistan and India.”
Globally, 1,213 ships were recycled in 2013. Slightly less than half of these (645) were beached in India, Pakistan or Bangladesh. The overall number of recycled ship is fairly stable, but there has been a 24 percent reduction in beaching from 850 to 645.
“We are encouraged by this trend,” says Soeyland.
Forty percent of the beached ships belonged to EU ship owners. New EU regulations that entered into force on January 1, 2014 outlaw this activity. Unless a robust and predictable incentive or refund mechanism accompany the regulation, it is almost certain that an increasing volume end-of-life ships will fly flags of convenience as a mean to blur the line of responsibility and chain of ownership.
Ships destined for recycling contain toxic substances such as asbestos, heavy metals, oil residues and PCBs. Asia – due to it proximity to growing trade – has been a preferred recycling region. Several ship owners put profit before environmental stewardship when choosing beaching. Beaching exposes workers to working conditions that break the very core of UN conventions and also expose the environment to irreparable damage.
A silver lining?
Twenty-one out of 40 ships previously owned or controlled by Norwegian interests ended up on beaches, according to data from the NGO Shipbreaking Platform and The Bellona Foundation. Nineteen ships were recycled in China, Turkey or Denmark in much safer conditions for workers and proper attention to pollution prevention. The most alarming finding is that seven ships ended up in the worst possible location – Chittagong in Bangladesh. The table below provide a full list of recycled ships, their beneficial owners and where the recycling occurred.
“We applaud ship owners such as Grieg Star Shipping, Høegh and Wilh. Wilhelmsen for doing ship recycling in a responsible manner,” says Soeyland. “Additional ship owners have changed their policies and there was a 46 percent drop in beaching from 2012 to 2013,”
Unscrupulous ship owners deny responsibility
Some of the ship owners close their eyes when a cash buyer decides to scrap their ships. It is widely known what buyers pretend to put a ship into further trade, but normally ships are sold for recycling shortly before certificates expire.
The most glaring example of such wilful blindness this year is Teekay Corporation which sent four ships going to Chittagong. This completely contradicts the environmental credentials presented on the company’s website. To make matters worse, their Norwegian subsidiary, Teekay Norway, is a member of the Norwegian Ship Owners Association (NR). NR has expressly asked their members not to break ships in Chittagong.
Legal obligations, OECD guidelines and UN guiding principles
The Hong Kong Convention was negotiated to promote responsible recycling of ships. It is far from being ratified and suffers from watered-down compromises to accommodate continued beaching. Ship owners are, nevertheless, bound by the OECD Guidelines for Multinational Corporations, UN Guiding Principles for human rights and business. Some ship owners have also committed themselves to signing the UN Global Compact.
New EU-regulations and flag of convenience
Once applicable, the new EU ship recycling regulation will ban the breaking of ships registered under the flag of an EU Member State in beaching yards and demand proper recycling in facilities that meet the requirements set out in the Regulation.
However, the Regulation runs the risk of becoming mere tissue paper: More than two thirds of the European ships dismantled in 2013 did not sail under the flag of an EU Member State when heading for a dismantling yard, and would therefore not have been covered by the new Regulation.
In addition to the ships already sailing under non-European flags during operational use, another 55 ships were flagged out from European registries just before scrapping outside the EU. Flags of convenience such as Comoros, Tuvalu, Saint Kitts and Nevis, Togo and Sierra Leone, that are less favored during operational use, were all the rage for the end-of-life vessels broken on beaches in 2013.
“Reflagging has always been a convenient way for ship owners to circumvent rules enforced by the flag states,” says Patrizia Heidegger, Executive Director of the NGO Shipbreaking platform. “The Platform and its members have been calling upon the EU to introduce an economic incentive to promote clean and safe ship recycling, because a Regulation based only on the voluntary registration under a European flag will not have the promised impact.”
 The criteria used is beneficial ownership within the last 6 months leading up to ship recycling. Norwegian ownership or interest refer to companies that have significant presence in Norway, managed from Norway, listed on the Oslo Stock Exchange or owned by Norwegians with registered domicile outside of Norway.