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Green Ship Recycling: growing support in EU Parliament for financial mechanism

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New study argues an incentive for shipowners is legal, enforceable, and effective

22 January 2013 Just as the European Parliament is starting to grapple with how a financial mechanism can ensure that green ship recycling takes place globally and in particular with ships controlled by the European Union, a study published today[1]  by the Dutch economic consultancy Profundo argues that such a measure is not only legally defensible but is necessary to ensure the success of any green ship recycling legislation.

The report provides three different alternative models: a fund financed by shipowners through taxes levied at EU ports, a ship life insurance scheme, and a savings account coupled to a transitional fund specifically aimed at financing the recycling of older ships.

The NGO Shipbreaking Platform, a global coalition of 18 environmental, human rights and labour rights organisations promoting clean and safe ship recycling, welcomes the study’s findings and calls on the European Parliament and the Council to include a financial mechanism in order to turn the Commission proposal into an effective instrument to promote responsible ship recycling and to level the playing field globally. The Platform is also releasing today an updated version of its Policy Paper, which contains a detailed argumentation about the objectives and elements that should be included in the financial mechanism [2].

“Every year, more European end-of-life ships containing hazardous materials are sent to India, Bangladesh and Pakistan. Such practices are unacceptable and Europe is in the driver’s seat to put a stop to this on-going human rights and environmental disaster, ” says Patrizia Heidegger, Executive Director of the NGO Shipbreaking Platform. “Only a financial mechanism enforced in EU ports can properly internalize costs and close loopholes, which have allowed ships until now to escape legislation and accountability.”

The NGO Shipbreaking Platform argues that any such mechanism must be based on individual producer responsibility and be a strong economic incentive for shipowners to dismantle their end-of-life vessels properly. The financial incentive must meet the following three objectives:

  1. internalize the costs for proper ship recycling and the management of hazardous wastes;
  2. discourage the reflagging of end-of-life vessels to avoid European regulations;
  3. implement an individual shipowner responsibility scheme to encourage the shipping industry to procure green ship design and pre-clean ships during operational use.

The Commission itself discussed the idea of a fund in its Green Paper “On better ship dismantling” and the European Parliament already called on the Commission in 2008 to analyse different possibilities. Unfortunately, the Commission did not include a financial mechanism in its proposal published in March 2012. However, Carl Schlyter MEP, the rapporteur to the Environment Committee in the European Parliament, has suggested a fund financed by fees paid by ships calling at EU ports, which is now being discussed by all political groups.

“It was a grave oversight that the Commission did not use its time and resources prior to publishing its proposal last March in order to thoroughly analyse and propose such a mechanism itself, ” says Patrizia Heidegger. “We welcome Carl Schlyter’s initiative as well as other members’ commitment to include an economic incentive for environmentally sound and safe ship recycling into the regulation.”


[1] Download the Profundo study “Financial mechanisms to ensure responsible ship recycling” here: http://bit.ly/10OgPB7

[2] Download the updated Policy Paper here: http://bit.ly/TeEAz5


Patrizia Heidegger Executive Director NGO Shipbreaking Platform patrizia@shipbreakingplatform.org +32 (0) 2 6094 419

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