Andreas A. Tsavliris: the Salvage Industry has much to contemplate

Whilst accidents and incidents will gather unwanted headlines, these would pale into insignificance were there to be a major loss of life or a major environmental incident arising from events not only in the high seas but very close to shore too. Add Piracy and Terrorism and you can see the issues facing today’s salvors in this peculiar but most important profession and service to humanity in its entirety.

For these issues John N. Faraclas asked Andreas A. Tsavliris, principal of the Tsalviris Salvage and President of the International Salvage Union, and here is how he replied:

Firstly tell us why the salvor must be an oil spill responder in the first instance on incidents of Environmental Damage?

The salvor is invariably the first responder contractor to be engaged to save property -ship/cargo,  and possibly lives. He is therefore well placed to immediately react to any pollution threat.

Concern for the environment has seen the role of the salvor transformed over the past 30 years. Salvage contractors still remain the best line of defence in combating environmental dangers created by oil spills and other marine casualties. They operate under increasing public scrutiny brought about as a result of extensive media coverage and a policy of zero tolerance adopted by government authorities.

Nowadays, salvors must meet the ever higher and unyielding expectations of both the public and the politicians, when carrying out salvage operations. The growing concern of coastal states, keen to protect and preserve the marine environment, has also led to greater government interference in dealing with marine casualties and salvage operations.

What were the lessons learned from the Sea Diamond and the Costa Concordia, two incidents in the Mediterranean and adjacent to major touristic resorts?

In the cases of Sea Diamond, and more specifically Costa Concordia, it demonstrated to the watching world that disaster can befall large cruise liners. With cruise-ships the challenge is the sheer amount of humanity involved. Even in benign sea conditions the safe evacuation and transport of many, many thousands of passengers – a good number of them elderly – and crew is extremely difficult. If you throw in bad weather and a listing vessel – the picture becomes alarming. Add a fire or massive flooding and it is a horrific prospect.

Despite technological advances “Titanic” accidents – brought about by human error – are ever omnipresent. The fact that cruising involves calling at touristic resorts and destinations increases the risk of the occurrence in the vicinity.

Back to the second question: how to you site the authorities respond?

In the case of the Sea Diamond the authorities response apparently added to the confusion which ensued following the accident. Indeed it is also suggested that errors in judgment were probably made by the Authorities.

In the case of the Costa Concordia the authorities seem to have responded responsibly and efficiently – although one wonders why the vessel was allowed to come in so dangerously close on various occasions.

Generally speaking – as we saw in the Prestige incident the role of the authorities can be positive or negative.

Environmental damage continues to be hotly debated but will it ever get off the ground or might there be a compromise? What about Salvors’ immunity? What progress has been made on this?

Following the publication of the new edition of the Lloyd’s Open Form contract –LoF as we call it,  LOF 2011, and the accompanying standard arbitration clauses, the changes made to the contract make it fit for use in the modern shipping environment. Nevertheless the ISU considers that the present system under the 1989 Salvage Convention, and the commercial arrangements under Lloyd’s Form 2011, and where applicable, the Special Compensation P and I Club Clause – the SCOPIC 2011 – do not provide proper recognition of the salvor’s efforts in carrying out their obligations under the 1989 Salvage Convention – environmental salvage awards should recognize the environmental benefit conferred by salvors.

The ISU believes the system should be updated to provide for the assessment of an award which recognises the salvors efforts in avoiding or minimising damage to the environment and the liability contingent there to. The ISU is therefore working to bring about the necessary change, and we believe it can be done simply. I will, given the chance, refer to this later.

What are your comments on the Nairobi Treaty of 2007 on wreck removals?

The Nairobi Wreck Removal Convention saw the introduction of a new international regime for wreck removal aimed to fill the gap in the existing international legal framework. The Convention provided a legal basis for coastal States to remove, or have removed, from their coastlines, wrecks which pose a hazard to the safety of navigation or to the marine and coastal environments, or both. It makes shipowners financially liable and requires them to take out insurance or provide other financial security to cover the costs of wreck removal, as well as also providing States with a right of direct action against insurers.

The Nairobi Wreck Removal Convention was an important step forward as it provides financial security to States encouraging them to more readily take action whenever there is an environmental threat and/or danger to navigation.

Unfortunately the regime does not work well as in most cases the insurance invariably placed is neither mandatory nor enforceable. In some cases it is absolutely farcical!

What issues are still open and by prioritizing them how these will positively affect salvage?

As you now, Salvage is an industry like most which encounters various challenges and poses various issues and difficulties. The challenges/issues which I will be prioritizing, include*:

• recognition of work/efforts of professional salvors,
• exempting seafarers from criminalization,
• granting responder immunity to salvors
• designating places of refuge
• the proliferation of government intervention
• inhospitable coastal states
• pleading sovereign immunity
• clientele payment defaults
• increasing salvage rewards
• encouraging wreck removal projects,
• developing the best practices for marine casualty management. For your information, you might have heard of this, The Nautical Institute and the International Salvage Union have recently published their Casualty Management Guidelines, a book which provides comprehensive practical guidance to help shipowners/managers, seafarers and coastal authorities during a marine casualty.
• updating a salvage convention
• impositioning mandatory insurance,
• cancelling salvors unlimited liability,
• salvage securities –difficulties in collecting same in hostile states
• granting environmental and liability salvage awards

What’s the best way to examine special compensation awards? And I guess you want to continue from the fourth question… adding some points.

The International Salvage Unions’ suggestion that Environmental Awards which recognize the environmental benefit conferred by salvors could be achieved by primarily amending the relevant provisions of the 1989 Salvage Convention. Salvors have expressed their concern in recent years to shipowners and believe that with such appropriate modifications it is possible to achieve a fairer mechanism to reward salvors for their efforts in protecting the environment.

It is important to point out that salvors do not expect to be paid unless there is a “added value” conferred and they fully expect an environmental award to be commensurate with that benefit. Salvors do not expect anything unless it has been earned and are happy for an appropriate tribunal to be the judge of what is fair and reasonable.

Reviving the concept of environmental – and liability, salvage would necessitate unraveling the complex compromises agreed in the salvage convention – unless it is achieved by a “small” change to the existing wording of Article 14. Although, one can well understand the liability insurers’ reluctance to change the current system, but the improvement proposed will ultimately be as much to their benefit as everyone else. There will be a fairer distribution of what is awarded between shipowners, cargo interests, property insurers and P and I Insurers. More importantly, the shipping industry and the public will be more secure because emergency services provided will be properly rewarded for what they actually do, moreover salvors will be encouraged, both to remain in business and to invest for the future.

And finally, in your capacity as President of the International Salvage Union, what is the message you convey to the shipping world vis-à-vis the salvage profession?

The salvage industry faces numerous challenges in a shipping world that has changed significantly in the past decades. Commercial pressures increase and society rightly expects good environmental outcomes. Yet the current regime does not fairly reward salvors. There is increased involvement and demands from multiple shore-based authorities and incidents are played out in the full glare of the media with the risk of the salvor being made a criminal if some pollution occurs during the operation. Salvors now have to cope with piracy and terrorism. Add the enormity of modern cruise ships, container ships and bulkers and it is clear that the salvage industry has much to contemplate.  However, salvors are problem solvers and will not hide from a challenge. They will continue to stand ready to assist casualties all around the world. As my father, Alexander G. Tsavliris, once said: “Success is the ability to change”.

Thank you for your simple and very explanatory replies and when the occasion arises we will revert and see the total progress on the issues discussed.

* We look forward having our viewers comments on the above interview, so a live dialogue debate can follow for the benefit of our industry and the sensitiveness of the salvage sector in its entirety.

* We have created this unordered list to facilitate our viewers