June 23, 2008 - Round Table celebrates IMO's 60th

To mark IMO's 60th anniversary of the adoption of the United Nations Convention bringing IMO's existence into being, the Round Table of International Shipping Associations marked the occasion by producing a leaflet and speaking at the IMO's 100th Council Meeting on 18 June.

The leaflet issued jointly by BIMCO, ICS / ISF, Intercargo and Intertanko, explains the Round Table's desire for effective Global Regulation for a Global Industry, as opposed to fragmented localised regulations which unnecessarily complicates compliance and raises costs for consumers, Governments and owners.

Copies of the leaflet may be downloaded from www.shippingfacts.com

A copy of the speech delivered by Intercargo's Secretary General, Mr Roger Holt, to the IMO Council Meeting special session, in which speakers from the Round Table organisations plus IACS and the ITF outlined their thoughts on the current and future relationship between Industry and the International Regulatory Regime, follows.

IMO – 60 years in the service of shipping

IMO’s relationship with the maritime industry

Secretary-General, Excellences, Representatives of Member States, Delegates, Ladies and Gentlemen,

This is indeed an important occasion in the history of the maritime industry and it is entirely appropriate that the anniversaries which we are celebrating this week here at IMO should cause us to reflect on what has gone before and what we can expect in the future.

For certain the International Maritime Organisation has done a good job as regulator of the international maritime industry since the constitutive Convention was entered into force 50 years ago. During that time it has been fortunate to have 3 highly competent Secretary-Generals plus their Secretariats to provide the necessary leadership and dynamism to drive the organisation forward and address the regulatory issues for the industry.

But how has this impacted on INTERCARGO and its members and what differences can we observe in the dry bulk sector? How important has the IMO/INTERCARGO relationship been over these 50 years and what has been achieved?

Before addressing these questions, perhaps a short introduction to INTERCARGO is in order.

INTERCARGO is the acronym for the International Association of Dry Cargo Shipowners and is the direct entry association for international dry cargo shipowners with particular reference to bulk carriers.

INTERCARGO was the brain child of Mr Antony J. Chandris, a highly respected Greek shipowner, who had realised that there was a need for an international forum for individual dry cargo shipowners: a forum where they could meet to discuss matters of mutual interest and concern.

Support for the idea was canvassed among European and Scandinavian dry cargo shipowners in 1978 and the first General Meeting of the Association took place on 23rd April, 1980 in London. Its office was established in August of that year.

In the early days of operation, the objective of INTERCARGO was stated very generally to further the interests of dry cargo tramp shipowners internationally, to bring its influence to bear through contacts and co-operation with its members and with other international and national organisations, as well as through the media. Consultative status was achieved with UNCTAD in September 1981.

Its main purpose was to preserve the freedom of the seas, free competition and free enterprise. It was realised that individual shipowners had little or no chance to make their voices heard in the political arena of the day.

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The two main issues which were causing great unease in the early 1980s were the threatened boycott actions against open register ships and mandatory cargo sharing. There was also concern at the ongoing weakness of the then freight market and the commercial implications of overtonnaging for the future health of the industry. As the decade drew to a close, the freight market strengthened and many of the perceived problems started to be resolved.

At this time a number of major issues emerged for the dry bulk sector, such as: water ballast discharge control in Australia, revision of the IMO BC Code for the carriage of coal and bulk carrier losses. These and many others during this critical time shaped the work of the Association into the future.

INTERCARGO applied for and was granted consultative status at IMO in 1993 and the Association started to become heavily involved with the regulatory work of the Organisation. As the decade progressed it was clear that dry cargo owners were being put under great pressure from the rapid growth of Port State Control, the upgrading of STCW and SOLAS Conventions at IMO and the attendant enhanced surveys by the Classification Societies. The barriers to entry into shipowning were becoming more stringent and more expensive and there was a sharper focus on safety and quality issues.

The casualty record of bulk carriers at this time was causing concern and INTERCARGO set about producing annual records of total losses of bulk carriers of 10,000 dwt and above to focus on the likely causes of loss. Since 1990, these records have been put together in the form of a Casualty Report and each year the Report is submitted to the IMO for scrutiny. There has been a clear reduction in the number of total losses and lives lost and this can best be demonstrated through the 10 year trend lines which are presented in the Casualty Report. In summary, about 14 Bulk Carriers per year were lost in the 1990’s compared with about 8 today. This is still 8 to many, but INTERCARGO continues to be proactive in highlighting the vulnerability of bulk carriers and is supportive of realistic and effective solutions to the problem of structural failure and human error.

The end of the 1990s saw a shift in the INTERCARGO philosophy and a move towards change management. There was greater emphasis in trying to establish a level playing field through the acceptance of quality as a given requirement and the mantra ‘Beyond Competition – towards a Rational, Quality Industry’ was adopted.

At this time, the first tentative steps were taken to establish more cohesion amongst the shipping associations and INTERCARGO initiated a meeting of the Chairmen of BIMCO, ICS/ISF, INTERTANKO and INTERCARGO which became known as the Round Table of international shipping associations (RTisa). The purpose of RTisa is to provide a more effective voice in solving common issues of concern. One of the first tasks was to identify where the specific knowledge and skills lay within the shipping associations so that duplication of effort could be cut out. The result is that INTERCARGO has been able to concentrate more on bulk carrier issues and leave


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more general topics to others with the necessary expertise. This strategy is working well and will be developed further into the future.

During the early 2000s the work at IMO and IACS continued apace on the subject of bulk carrier safety. Given concerns about the lack of operating experience with Double Hulls, INTERCARGO fought long and hard to prevent the mandatory
new building requirement for double hull bulk carriers and was greatly relieved when IMO decided to allow both single and double hull designs for newbuildings.

More recently, INTERCARGO has been directly involved in the debate with the Joint Bulker Project on the subject of Common Structural Rules. It is to be hoped that competition between classification societies on design criteria alone are now a thing of the past and that bulk carriers will be built stronger and more fit for purpose. The development of Common Structural Rules is a vital part of the work which is being conducted at IMO on Goal Based Standards.

The need for a regulator in the international maritime industry is clear and the work which is concluded through the various IMO committees on the improvement of the existing conventions is vital.

In addition to the regulations which control the industry, shipowners themselves have been able to develop self-regulation in many areas and at a recent meeting of the Asian Shipowners Forum, it was pointed out that the members of the RTisa had all developed projects leading to enhanced self-regulation.

It is our belief that the improvement in the bulk carrier loss statistics has been a direct result of the regulatory process at IMO combined with an increasing owner commitment to safety and that therefore the reputation of the bulk carrier sector has improved accordingly. Unfortunately the focus on quality and safety is not universal across the bulk carrier fleet and it is clear that there are areas of the world where some ships of uncertain quality are able to trade without let or hinderance. This is regrettable but it is symptomatic of the current market conditions. We cannot ignore these aberrations and INTERCARGO will continue to monitor the whole of the bulk carrier fleet through its publication ‘Benchmarking Bulk Carriers’.

The current INTERCARGO Work Programme includes many items which are being considered at various committees at IMO. Such issues include

• Air emissions where we have positively supported the consensus necessary to make the appropriate amendments to Annex VI and the debate on GHG;
• The Definition of a Bulk Carrier;
• The safety of Dry Bulk cargoes such as Direct Reduced Iron;
• Concerns about excessive loading rates;
• Reception facilities, and
• Stowaways (Stowaway Focal Point).



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These are real issues which are vital to the membership of INTERCARGO’s existing membership spread throughout Asia, Europe, North America and elsewhere, implying that the strong relationship which has been built with IMO over the last 25 years should not only be maintained but enhanced in the future. I have no doubt that progress will continue to be made.

On behalf of the Chairman, Mr Nicky Pappadakis, the Vice-Chairmen, the Executive Committee and Members of INTERCARGO, I would like to thank you for this opportunity to participate in this panel discussion today and congratulate IMO on its 60 years since the adoption of its constitutive Convention and its 50 years since the entry into force of the Convention – not forgetting also the milestone of the 100th session of the IMO Council.

Thank you.


RH/13th June, 2008

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