The U.S. Department of Justice antitrust investigators served subpeona's on top container shipping container executives last week while they were in San Franciso to attend the Box Club meeting. The Box Club includes CEO's of major containers lines and only the heads of each company may participate in it's twice yearly meetings. US antitrust attorneys sit in on the meetings, even when they are held outside the U.S, to ensure that discussions do not go into legally precarious territory such as pricing. Quite often, the group also invites economists or industry analysts to attend. Under limited US antitrust authority granted by the federal maritime regulators, container lines that belong to discussion agreements can meet to discuss and agree on voluntary rate guidelines. The carriers are subject to the DOJ's antitrust prosecution if they exceed this authority by jointly fixing rates.
Companies that have confirmed that they were served subpeona's include Maersk Line, MSC, CMA CGM, Hapag Lloyd, Evergreen and OOCL among others. At this time no specific details have been released, and it should be noted that a subponea does not mean that a company has engaged in illegal behavior.
The Minister of Finance presented Parliament and Canadians with Budget 2017 this afternoon. Budget 2017, titled Building a Strong Middle Class, offers targeted investments to tackle what it calls the "challenge of change." It offers little new spending, but fleshes out details on where dollars earmarked in last fall's economic update will be spent. While the Chamber will be reviewing the Budget Plan in further detail, some items relevant to the marine sector include:
Trade and Transportation
• A new Trade and Transportation Corridors Initiative (modeled on the previously Gateway Strategy) that includes:
o A National Trade Corridors Fund
o A Trade and Transportation Information System
• The National Trade Corridors Fund will target congestion and inefficiencies at marine ports such as Vancouver and Montreal, as well as rail road and highways around Toronto and other urban areas. It will invest $2 billion over 11 years. Another $5 billion to be provided through the Canada Infrastructure Bank (which will be operational by end of year 2017).
• $50 million over 11 years to Transport Canada to launch a Trade & Transportation Information System (housed in a new Canadian Centre on Transportation Data). Open-data portal that will provide performance measures and multi-modal data collection/analysis.
• $76.5 million to Transport Canada to fund its operational work on ‘modernizing’ the transportation system, including regulations for autonomous vehicles, new pilot projects for unmanned vehicles/drones, etc)
• Regarding the potential for the privatization of ports, the government will launch a three-year horizontal review of federal fixed assets, staged by asset-type.
• $256 million over five years to facilitate Canada joining the Asian Infrastructure Investment Bank.
• Greenhouse gas regulation coming to the marine, rail, aviation and vehicle sectors, led by Transport Canada, with a proposed investment of $56.9 million over 4 years beginning 2018/19.
• Development of clean fuel standards to reduce greenhouse gas emissions associated with the use of fuel.
• New coastal protection measures – protecting 10% of coastal & marine waters.
• The Oceans Protection Plan was highlighted but no new funding or announcements were attached to it.
• $5 million for 2017-18 to DFO to support small craft harbours.
Overall, the new Trade and Transportation Corridors Initiative appears to be positive and aligns with the Chamber’s request of government to address issues of competitiveness through improved data transparency, collection and analysis. Notwithstanding, it is yet to be seen whether its development will be sufficiently aggressive to ensure the competitiveness of Canadian Gateways, and more specifically Canada’s marine transportation corridors in a vulnerable commercial marketplace. It is also positive that the government has listened to the concerns of stakeholders and will take a more deliberate and engaged approach to considering the privatization of ports. We will of course be interested to learn more about the intentions of the government around GHG regulations and if it intends to align with efforts of the International Maritime Organization.
The Maritime Museum of British Columbia is once again inviting nominations for the SS Beaver Medal, an annual award that recognizes outstanding achievements in B.C.’s marine sector.
Nominations are encouraged for individuals who have made noteworthy contributions to our Province’s marine interests,including but not limited to: science, technology, business, applications of maritime skills, nautical heritage and culture, and academic offerings. An award is also made to recognize a noteworthy organization, vessel or technological project.
Nominations for 2017 close on May 20. Nomination information, easy-to-complete forms and due dates are located at www. http://mmbc.bc.ca/about-2/s-s-beaver-medal/.
For information please contact:
Maritime Museum of BC
250 598 1661
The Honourable Catherine McKenna, Minister of Environment and Climate Change, announced today the appointment of Dr. Douw Steyn as a new member of the Review Panel established to conduct the environment assessment of the proposed Roberts Bank Terminal 2 Project in Delta, British Columbia. Dr. Douw Steyn is a Professor Emeritus in the Department of Earth, Ocean and Atmospheric Sciences at the University of British Columbia and longtime resident of Vancouver. His academic expertise is in boundary layer, mesoscale, and air pollution meteorology. Dr. Steyn has a PhD in Atmospheric Science from the University of British Columbia, and a Master of Science and Bachelor of Science from the University of Cape Town. Dr. Steyn has wide knowledge of ecosystem structure and function and specific knowledge of the Fraser River Estuary. Dr. Douw Steyn will join Panel Chair, Ms. Jocelyne Beaudet, and panel member, Dr. David Levy, who were appointed to the Review Panel by the Minister on May 31, 2016.
Somali pirates who seized the Comoros-flagged oil tanker, Aris 13, have released the ship and its eight Sri Lankan crew, bringing the first hijacking since 2012 to an unusually swift conclusion without the payment of a ransom. After a gunfight and intense negotiations, it is believed that the pirates released the ship after learning that Somali businessmen had hired the Aris 13, to transport oil from Djibouti to the Somali capital, Mogadishu. International Maritime Organization (IMO) Secretary-General Kitack Lim urged the shipping industry to be vigilant and apply diligently IMO guidance and best management practices to avert possible piracy attacks.
This week the title of "world's largested containership" was handed over to the MOL Triumph during its naming ceremony at the Samsung Heavy Industries' Geoje shipyard. The 20,150 TEUs MOL Triumph is the first of four ultra-large container ships being built for MOL of Japan. The vessels were ordered in February 2015, and steel was cut for MOL Triumph in January 2016. MOL Triumph has a length of 400 meters, breadth of 58.8 meters (193 feet) and depth of 32.8 meters (108 feet). The ship boasts an array of energy-saving equipment designed by Samsung Heavy Industries including propeller, rudder valve and stator. MOL Triumph will be delivered on March 27 after preparation for her maiden voyage are complete. The vessel is expected to join THE Alliance FE2 loop connecting Asia and northern Europe.
In 2016, a jury awarded a woman $3.6 million in a gender discrimination lawsuit filed against the Puget Sound Pilot Commission, a Washington State agency. The woman, a former deep draft vessel master, was awarded the money after she was denied a state pilot license. She was the first woman to successfully apply and enter the training program to be a Puget Sound pilot. Following the multimillion-dollar jury verdict, the State of Washington filed an appeal. But at some point the State halted their appeal and entered into settlement negotiations with the plaintiff, resulting in a doubling of the jury award, bringing the total settlement to just over $6 million.
This week Bill 5819, supported by the Pacific Merchant Shipping Association (PMSA) was introduced in the Senate regarding the payment of this lawsuit. The Senate Bill would require the board of pilotage commissioners to maintain the existing pilotage tariffs over the next six years to ensure that industry does not end up paying the $6 million settlement. The Bill proposes that annual pilot licensing fees increase to $26,000 for a pilot and that the joint legislative audit and review committee conduct a performance audit of the board of pilotage commissioners to examine whether the board is complying with certain statutory requirements. PMSA is hoping that the underlying discriminatory behavior identified by the court will be changed and be prevented going forward; but it also requires that full responsibility be placed on those who were the cause of such actions.
The Port of Prince Rupert today released its 2017 cruise schedule, celebrating a more than 100% increase in the number of ships and passengers visiting the coastal community this summer. A total of 25 vessels carrying approximately 17,000 passengers will dock at Prince Rupert’s Northland Cruise Terminal in 2017, representing the city’s biggest cruise season since 2011. The coming season also marks the second consecutive year that the number of cruise ship passengers visiting Prince Rupert has doubled, up from 7,264 in 2016 and 3,626 in 2015.
Seabourn Cruise Line is returning to Alaska for the first time in 15 years, and will include Prince Rupert on six voyages of the 450-passenger Seabourn Sojourn beginning on June 23. Crystal Cruises will return to Prince Rupert for three calls in 2017, after the successful inaugural visit of its Crystal Serenity ship in 2016 on the heels of its iconic sailing of the Northwest Passage. Norwegian Cruise Line is coming back to Prince Rupert for the first time since 2011, with the two largest vessels of the 2017 season. The Oceania Regatta will return for seven calls this season, bringing the largest share of Prince Rupert passenger traffic with capacity for 4,788 guests. Regent Seven Seas Cruises will sail the Seven Seas Mariner into the Prince Rupert's harbour for two calls, and Ponant’s 264-passenger Le Boreal will make one of the last calls of the season in September.
The European Parliament has passed its Resolution on the Arctic, calling on the ban of oil drilling in the Arctic and shipping of heavy fuel oil so as to protect its vulnerable ecosystem and keep it a low-tension and cooperation area. The parliament called on the Commission and the Member States “ to actively facilitate the ban on the use of heavy fuel oil (HFO) and carriage as ship fuel in vessels navigating the Arctic seas through MARPOL of IMO.” The resolution is a non-legislative document, which together with similar conclusions by the EU Council will guide future EU policy addressing environmental risks in the Arctic.
Last Friday at a change of command ceremony at the Coast Guard Base in Seattle, Capt. Linda Sturgis relieved Capt. Joe Raymond as the commanding officer of Coast Guard Sector Puget Sound - 13th District. Raymond’s next assignment will be at Coast Guard Headquarters in Washington, DC as the executive assistant to the vice commandant of the Coast Guard. During Raymond's command between 2014 and 2017 he was recognized for a number of accomplishments including his efforts in setting security standards with Transport Canada for LNG fuelled vessels in the Pacific Northwest waters and carrying out 1,000 shiprider patrols in partnership with the RCMP.
The Institute of Chartered Shipbrokers (the Institute) and BIMCO have announced the start of a new venture combining BIMCO’s eLearning courses and the Institute’s global engagement with students. This is a major boost for new entrants in the industry by giving them greater access to quality education and improved standards in maritime centres across the globe. A test group of Institute students - in mainly developing countries – and covering a wide range of shipping centres across the globe, will be able to use BIMCO’s eLearning courses in preparation for Institute exams. The first group of students, starting this week, are from Aberdeen, Accra, Cape Town, Durban, Lagos, Limassol, London, Mombasa, Paris, Shanghai, Singapore, Stavanger, Sydney and Vancouver. The plan is to open the opportunity to all the Institute’s students by the autumn of 2017. Other joint training activities are also being considered. For more information on the Canada branch located in Vancouver, visit: www.ics-canada.ca.
Hapag-Lloyd has postponed the completion date for its takeover of United Arab Shipping Company (UASC) to May 31 from March 31. All merger clearances and regulatory approvals and all necessary banking approvals from Hapag's side have been obtained as have most banking approvals from Dubai-based UASC’s side, it said. The deal, worth 7 to 8 billion euros (US $7.52-8.60 billion), appears to be have been delayed by financial issues affecting all carriers. Hapag-Lloyd said despite the delayed closing date that its participation in THE Alliance would start as planned on April 1, with UASC due to join later.
In another venture, Hyundai Merchant Marine Co. has now officially signed up a strategic cooperation deal with the members of 2M, MSC and Maersk Line. This will include a series of slot exchanges and purchase on East-West routes.
Singapore's home-grown shipping line Pacific International Lines (PIL) is ready to sail into exciting new waters by becoming a bigger player, even as the industry grapples with one of its longest, deepest downturns. The company in marking its 50th anniversary announced plans to add 12 new container ships to its current fleet of about 180, expanding its overall capacity to 500,000 standard-sized containers by the end of next year.
PIL, set up in 1967 with just four coastal vessels, operates nearly 180 vessels as one of the largest private shipowners in South-east Asia today and is the 15th-biggest container shipping line globally. PIL appears to be holding up well amid the downturn. Managing director Teo Siong Seng said the company has not retrenched any of its 18,000 staff globally, including 700 in Singapore. PIL's strength is its ability to enter new niche markets particularly in the Western Pacific Region. In the Port of Vancouver, Westward Shipping Ltd. has served as PIL's agent since 2004.
BG International, a member of Shell Group, has confirmed that it is discontinuing development on the proposed liquefied natural gas project that was to be on Ridley Island in Prince Rupert. The company says its Prince Rupert office will remain open until May, in order to complete community engagement. The project appeared to lose favour, after Shell aquired BG Group two years ago but in the press release it alo noted that the LNG Canada project in Kitimat continues to be actively progressed by Shell and the joint venture participants as an opportunity to bring Canadian gas resources to the growing global gas markets. Shell's LNG outlook, issued last month, projects demand to grow at a rate of four-to-five per cent per year between now and 2030.
Western Stevedoring has published two dates this month for an interactive presentation and exclusive bus tour at their Lynnterm facility in North Vancouver. This is an opportunity to view their operations up close and discover first-hand the vital role that Western Stevedoring plays in Canada’s global trade.
The BC Maritime Employers Association has opened a new training facility in Prince Rupert in view the increased demand for trained longshore workers in the northern communities. The BCMEA Training Department will be spending close to two million dollars on training and recruitment in Prince Rupert over the course of 2017, and again in 2018.
It is with great sadness that we advise that Brian Bland of Interocean Steamship Corporation passed away peacefully on March 5th in the arms of his loving wife Marie at Lions Gate Hospital. Brian was a member of our Board of Governors and served as the Board of Director's Chair in 1990 and 1991. He leaves behind a loving family and many personal and industry friends. A graveside service will be held on Saturday, March 18th at 1pm at Mountain view Cemetery as noted in this obituary.