A cash buyer is a company specialised in the trade of end-of-life vessels to beaching yards. Cash buyers pay ship owners up-front before the ship reaches its final destination and is dismantled. Cash buyers sell ships to shipbreakers that can offer the highest price and are notorious for hiding business dealings and dodging waste export laws by re-registering vessels under flags of convenience and anonymous post box companies.
To reduce taxes, fees and avoid more stringent social and environmental requirements, the shipping industry has recourse to so-called “flags of convenience” – also commonly known as “flags of inconvenience”. These flags are known for their poor implementation of international maritime and labour laws and have outsourced the management of their registries to private companies. At end-of-life, FOCs such as Comoros, Palau and St. Kitts and Nevis are particularly popular.
A Statement of Compliance with the Hong Kong Convention (HKC SoC) is issued on the basis of a business-to-business agreement between a recycling yard and a consultant. SoCs are issued on a check-list basis and clearly do not provide a reliable guarantee that conditions at the yards are conducted in a safe and environmentally sound manner. HKC SoCs are currently used by industry proponents to greenwash beaching practices.
SHIP RECYCLING METHODS
Alongside is a recycling method mainly used in China, Europe and United States. The vessel is brought along a wharf or quay in a sheltered harbour or river, and dismantled by cranes from top to bottom. Cutting operations proceed until the lower part of the hull can be lifted out in one piece, pulled up a slipway for final cutting in a fully contained area.
Beaching is the process in which a ship is laid on a tidal mudflat. The vessel is grounded deliberately during high tide and breaking operations usually take place during low tide when the vessel is not submerged by the sea. 70% of ships are scrapped using the beaching method as practiced in South Asia. As cutting operations take place in the intertidal area, pollutants are inevitably discharged into the environment and washed away by the tide. There are no means of full containment or remediation. The beaching method is strongly criticised for its unsafe working conditions and the environmental harm it causes to fragile coastal ecosystems and surrounding communities.