The Global Sulphur Cap 2020

The implementation of the global 0.50% sulphur cap for bunker fuel under MARPOL Annex VI represents a major challenge to the shipping industry. Starting from 1 January 2020 vessels will be required to either burn low sulphur fuel as bunkers, use alternative fuels or use scrubbers fitted to exhaust systems to ensure that emissions remain within specified criteria even when using fuels with a higher sulphur content.

As from 1 March 2020 the carriage of fuel with sulphur levels greater than 0.50% will be prohibited unless the vessel concerned is fitted with scrubbers.

Not only does this gives rise to significant operational issues for shipowners especially around the transition to low sulphur fuels but it may also result in penalties for non-compliance as well as other liabilities not previously seen. Concerns about the cost of complying with this low sulphur cap and whether there will be sufficient availability of low sulphur fuel oil have also been well publicised.

Discussion Topics

In this series of discussion topics, which is grouped according to the different situations that may occur, the Club anticipates some of the questions and issues that may arise due to the implementation of the global 0.50% sulphur cap.

BIMCO Low Sulphur Time Charter Party Clauses - Are these Comprehensive?

Voyage Charter Parties and Bills of Lading

Time Charters - potential disputes

Issues arising from non-compliance

Fuel Management & Operational Issues

The matter is looked at from the Club’s Loss Prevention Department perspective, taking into account practical sea-going background and experience in ship technical management.

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Low Sulphur Bunker Regulations Seminar

HFW address the issues arising from compliance with the 2020 Sulphur Cap under existing charter parties, including methods of compliance, the transition from high sulphur to low sulphur fuel oil and the low sulphur carriage ban.

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External guides and materials

We have collated information and resources on this topic produced by the Club and by third parties to help guide Members in complying with the regulations.

Background – the IMO published materials on the background to the regulations as well as some FAQs.

The International Group Clubs circular setting out the background to the cap and the potential application of P&I cover for penalties arising from non-compliance.

The Exhaust Gas Cleaning Systems Association has numerous resources and publications available on their website.

The International Chamber of Shipping have produced a comprehensive guide for shipowners and seafarers on how to comply with the regulations.

The Oil Companies International Marine Forum have produced a guide for implementation of sulphur oxide exhaust gas cleaning systems.

Download the document BIMCO 2020 Marine Fuel Suplhur Content

ISO Annex B