There has been a tendency for reference to be made to Regulation 18 (of Annex VI of the International Convention for the Prevention of Pollution from Ships, 1973 as modified by the Protocol of 1978) as containing ‘exceptions’ to Regulation 14 (of the same), which sets out the maximum sulphur content limits for marine fuels. While this may be a convenient short-hand description, it can lead to misunderstandings.
In drafting Annex VI, the International Maritime Organization (IMO) deliberately left it to state parties (be they flag or, more likely, port) to enforce Regulation 14 and it is for state parties to determine what consequences should flow from non-compliance. What Regulation 18 does provide (at sub-paragraph 2) is what a state party should do if a ship is found not to be compliant with Regulation 14, and this includes factors that should be taken into account in mitigation when considering what sanction to apply.
This is clear from sub-paragraph 2.3 of Regulation 18, which holds that “if a ship provides the information set forth in paragraph 2.1 of this regulation [namely: (1) a record of its action taken to attempt compliance; and (2) evidence of its best efforts to obtain compliant fuel oil], a Party shall take into account all relevant circumstances and the evidence presented to determine the appropriate action to take, including not taking control measures”.
The closest that Regulation 18 comes to creating an exception is at sub-paragraph 2.2 of Regulation 18 where it provides that state parties should not require (or expect) a ship “to deviate from its intended voyage or to delay unduly the voyage in order to achieve compliance”. However, how each state party, particularly port states, interpret this remains to be seen.
It is not that Regulation 18 is a new addition to Annex VI; it is just that it has only really been put to the test in the context of emission control areas (as defined in Regulation 14 paragraph 3) (ECAs), which are still relatively limited in terms of geographical scope. States that are not within an ECA are unlikely to have been put to the test yet.
The reason for this is that, while sulphur content limits for marine fuel have been in force since 19 May 2005 and were reduced on 1 July 2010, these earlier limits (4.5 and 3.5 per cent m/m respectively) were comparatively easy to comply with in terms of availability. Indeed, the original 4.5 per cent m/m limit was above that of almost all of the marine fuels on the market at such time. This is not the case for the new 0.5 per cent m/m limit, since there is both an absence of compliant residual marine fuels available on the market and an (anticipated) shortage of compliant distillate marine fuels available as an alternative.
Even with the revised lower (0.1 per cent m/m) limit that has been in force since 1 January 2015 for ECAs, the demand for such fuel has still been comparatively low. The issue for ships when required to enter into an ECA was usually whether they had sufficient compliant fuel onboard when ordered in and, if not, whether such fuel could be obtained on passage before entering into the ECA. Aside from those ships calling into the United States (particularly in 2015 after the new limit entered into force), comparatively few ships seem to have tested whether sub-paragraph 2.2 of Regulation 18 would protect them if compliant fuel was not available on passage to an ECA. That is why the fuel oil non-availability report (FONAR) system is still being developed, with a final template expected to be submitted to and approved by the IMO at MEPC 74 in May 2019.
Even so, FONAR may be misunderstood. It is (as currently envisaged) nothing more than a standardised form of presenting evidence to satisfy the information that a state party is entitled to require of a ship under sub-paragraph 2.2 of Regulation 18, namely: “evidence that it attempted to purchase compliant fuel oil in accordance with its voyage plan and, if it was not made available where planned, that attempts were made to locate alternative sources for such fuel oil and that despite best efforts to obtain compliant fuel oil, no such fuel oil was made available for purchase.”
As such, FONAR is not a panacea, but it should assist in encouraging a more uniform approach to non-availability and the protection that sub-paragraph 2.2 of Regulation 18 should offer a ship. A standard form of FONAR should also make the management and assessment of non-availability reporting easier for party states (flag and port). For it it should be remembered that Regulation 18 is not one-sided. It also requires state parties to “promote the availability of fuel oils” that comply with Annex VI, including the sulphur content limits, and to “inform the [IMO] of the availability of compliant fuel oils in its ports and terminals”.