Policy Instruments to Enhance
the Maritime Safety andEnvironment Protection
Joint Seminarby Japan Maritime Center andthe IOPC Funds
October 18, 2023
Shinichiro OTSUBO, PhD
Distinguished Project Research Fellow, JTTRISpecially Appointed Professor, Tokai University(Former Director-General of Maritime Bureau, MLIT)
1

The safety at sea….have we accomplished themission?

Number of Marine Incidents
[N]
2,500

Worldwide
Miscellaneous[

Missing
Foundered

[%]

4.0

Contact
2,000

Fire/Explosion
Wrecked/Stranded
Collision

1,500

3.0

Rate of Incident (%)
2.0

1,000

1.0

500

0

0.0

Lloyd‘s Maritime Information Service（LMIS）

3

Marine Incidents in Japan

Number ofincidents

Numberof persons

Decreasing

Lowest in
10 yearsYear 2012

Incidents

Fatalities and missing

Year 2021

Japan Coast Guard
4

Marine incidents In Japanby Ship TypeIn terms of the number of marine incidents by ship types,
pleasure boats prevail by far.
Trend in past 5 years

Year 2021, based on ship types

No. vessels

7.
6.

5.

6. Passenger
ship, 2%
5.Tanker, 3%
4.Recreational
fishing, 4%

7. Miscellaneous,6%

3. Cargo
vessel, 11%No. vessels
Total 1,942

4.

3.
2.
1.

2. Fishing,
22%

Data: Japan Coast Guard

1. Pleasureboat, 52%5

Marine incidents In Japanby Type of Incidents
Trend in past 5 years
No. vessels

Year 2021, types of incidents
6. Collision with
8. Explosion
9. Miscellaneous
non-ship objects
7. Fire, 4%
6%
1. Unoperable,
5. Capsize,
40%
9.
6%
8.
4. Floodng,
7.
10%
No. vessels
6.
Total 1,942
5.
4.
3.
3. Stranded,
2.
12%
1.
2. Collision with ship,
21%
Data: Japan Coast Guard

Marine incidents In Japanby Ship Size Category
Small ships of less than 20 tons account for 80% of the incidents, as thosesmall ships outnumber those of other size categories among existing ships.

Year 2021, by size categories

Trend in past 5 years

3. 100 - 500 tons
7%

No. vessels

4. 20 - 100 tons
2%2. > 500 tons
10%

4.
3.
2.
1.

No. vessels
Total 1,942

1. < 20 tons
81%

Data: Japan Coast Guard

7

Maritime incidents in Japan✓ Approximately ２０００ incidents per year
✓ 80% of the incidents are small-sized vessels such as pleasureboats, as this category forms an overwhelming majority in numberof vessels.

✓ Location of incidents are mainly congested coastal sea areaand port area
✓ 80% of incidents are caused by human factors.
(to be explained later)

As statistics shows, we can say that the safety risk at sea
has been decreasing.
However, once a large-scale incident should happen, theloss and damage could be devastating.
8

Number of oil spills fromtankers

10-year average

Data: ITOPF“Oil Tanker Spill Statistics 2022”

）

Total number of incidents has been decreasing.
We still see tragic incidents involving human losses and /orlarge-scale loss of assets.

2012 Italy
Fatalities 32

2015 China
Fatalities 442

2013 Indian Ocean2014 Korea
Fatalities 295
Missing 92014 Japan
Fatality 12015 Japan
Fatality 12015 Japan
Fatality 52018 China
Fatalities 3
Missing 29
10Various types of incidents could happen

Cargoes and ship itself could suffer large loss and damage, andhuman losses are possible.
Ships may carry crude oil, oil products and liquid chemical as cargoes,as well as heavy oil as fuel. Once an incident happens, there is a riskthat the spill of these substances would damage the environment innearby sea area, and such influence may spread to a wider sea area.

出典：Maritime Injury Guide

出典：Getty Images

出典：Getty Images

Beside environmental damage, a large-scale incident
could also disrupt maritime transport and affectinternational supply-chain.

写真：THE FRENCH DEFENSE MINISTRY/AP/アフロ

If we consider only the influence on daily life in Japan,
the most serious case would be the disruption at
Choke Points, in particular, Holmes Strait, Straits ofMalacca and Singapore, and Panama Canal.

Businesses and governments in maritime field
have endeavored to establish and implement
better mechanism to reduce the safety risk atsea.

International regulatory system to enhance the safety dates back…
April 1912

Untergang der Titanic ("タイタニック号沈没")
ウィリー・ストーワー, 1912

BBC◼The International Convention for the Safety of Life at
Sea (SOLAS),1914
Only 5 countries ratified, has never been enacted due tothe WW I◼SOLAS 1929, enter into force in 1933
In 1935, SOLAS 1929 became effective for Japan
with the implementation of Ship Safety Act◼1949, IMCO Convention was adopted◼1958 IMCO Convention entered into force and IMCO
was established.
◼SOLAS 1948, SOLAS 1960
◼SOLAS 1974 with tacit amendment procedure
introduced◼IMCO reorganized to IMO in 1982

International Maritime Organization (IMO)⚫ The United Nations specialized agency with responsibility for thesafety and security of shipping and the prevention of marine andatmospheric pollution by ships⚫ Established in 1958, based in London⚫ Member States:175 Associate Members: 3 IGOs: 66 NGOs: 85⚫ Adopted 60 International conventions

15

Why we need international regulatory system for thesafety at sea and marine environment protection⚫ International shipping forms a global single market⚫ Regulations should be equally and universally applied to all ships••

A Ship may go anywhere in the world , irrespective of its flag.
Many players are complicatedly involved in shipping activities partly due to theOpen registry system (or Flag of Convenience)
ExampleExportingcountry•

Flag

Seafarer

Operator

Space charterer

Importingcountry

The International Maritime Organization (IMO) has developed International
regulations, under the principle of “non-discrimination” and “no-morefavorable-treatment”.
16Port State Control
Foreign ships in national ports can be inspected to verify that thecondition of the ship and its equipment comply with the requirements
of international regulations and that the ship is manned and operated incompliance with these instruments.

Flag State Control/Implementation
Backup to flag State implementation,
as “second line of defense” against
substandard shipping,Port State Control
Governments may inspect foreign ships that visit theirports to ensure that they meet IMO standards
contained in instruments to which the port State is a
Party.
With the principle of no-more favorable treatment
being applied, ships of non-Parties are subject to
PSC as well. If the ships do not comply with thestandards, they can be delayed or detained until
repairs are carried out and be subject to targeting.

PSC is conducted under the relevant
provisions of the mandatory instruments.
SOLAS, Load Lines, MARPOL,TONNAGEAFS (Anti-Fouling System)
STCW
COLREGMLC
BWM (Ballast Water Management)
Ship Recycling ( 2025 and later)17

Foreign ships subject to PSC in Japan18

Regional cooperation in PSC
Ships may voyage across the borders; control by the authority in single
country would not be effective for securing corrective measures.
Port State A
Conduct PSC
ForwardInformation

Flag State X
Flag State Control

Forwardinformation

Database
SystemNext Call Port State B
Follow-Up PSC

ForwardInformation

Next Call Port State C
Follow-Up PSC

Based on the principle of No More Favorable Treatment
Seamless follow-up and tracking of sub-standard ships

19

Mind that the transport activities are conductedby private companies.
If the industries cannot be competitive in globally
single market, their capabilities would be limited
in supporting the trade for Japan.
Japan could never survive without the stable
and robust maritime transport, and thus strong
maritime industries are indispensable to mere
survival of Japan.

Transport is not public works.
International regulatory system should bedesigned and operated so that it would induce
private industries to make their own efforts toenhance the safety, without excessively
intervening their business development.
We need:• globally unified rules,• inter-governmental coordination andcooperation,• cooperation with private industries in rulemaking, accommodating the latest technologicaldevelopment

Regulatory Framework

Overview

To operate a ship, it is required to comply with variety of regulations related
to e.g.,safety, security,environment
protection, labor, civil liability andCurrent
regulatory
frameworks
compensation.
Regulations related to Ships

Possible Liabilies

1.Nationality, Registry,
Measurement (Tonnage Convention)
2.Safety, Security, Environment（SOLAS, ISPS Code, MARPOL)

Criminal liability
Ship

Accidents
resulting in injury
or deaths, anddamages by noncompliance

Seafarers

3. Seafarers （STCW）

Order

4. Labour aspects(MLC)

MasterCivil liability

employer-employee

Pollution Damage
Ship owners havestrict liability, butcompensation islimited5.Authority/duty of Master（several Conventions）

6.Traffic rules （COLREG）

7.Liability（LLMC, CLC, etc.）

Ownership/
Management
Ship Owner/Company

Contract

8.Others（FAL, Hague-Visby, etc.）

Contract parties

Operator

Shipyards

Shipper

Insurer

Financial institution

Cargo Damage
Third Party

Compensation for
cargo loss

22

Why international rule-making matters
Example1989 Exxon Valdez incident
1992 MARPOL amendments adopted✓ Double-hull requirements for newly-built tankers✓ Mandatory phase-out of single-hulled tankers at fixed age

Completely new design and construction for new ships – challenge
from an early phase of concept design and sales negotiation.
Mandatory replacement of existing ships: huge impacts on the businessstrategies of shipping

Taking the lead in international rule-making, with the joint initiatives by businessand government, mean valuable contribution to the safety and environment
protection globally; at the same time, there are industrial policy aspects
•
•

•
•

Predictability of future regulations: positive in developing business strategies
Fair and reasonable standards and performance assessment would duly reward
the companies as well as their products and services, leading to fair competition.
Practical implementation of rules, such as appropriate testing procedures ofequipment, would avoid unnecessary costs while achieving the policy goals.
23
Avoid concept-driven and excessively idealistic approach on new rules

Japan has practiced the above-mentioned principles for along time.
【機密性２】
作成日_作成担当課_用途_保存期間【機密性２】

発出元 → 発出先
発出元 → 発出先

作成日_作成担当課_用途_保存期間
発出元 → 発出先

【機密性２】
作成日_作成担当課_用途_保存期間

The IMO member states thatseem to be the most potent
influencers of IMO policy are
Japan, the USA, Germany,
Norway and China, with
Denmark and Korea not too far
behind.
24

Having understood how the international regulatory
system works….
Back to the basics: what should we do for the safety
at sea?
First of all, avoid an incident: collision, grounding,
structural damage, loss of power/maneuvarability, etc.
Various rules on ship structure, intact stability andequipment (its performance standard, and testingprocedure, taking into account the latest technologies)

Then, minimize the loss and damage (incl. external
one)
Damage stability, protection of oil tanks, life-saving
appliances

Human factors in Marine incidents
Other unavoidable factors
233 ships
15%
Unavoidable
Material or structural defects
factors
73 ships
306 ships
5%

Inadequate watchkeeping
321 ships
21%

20%
Other humanerrors
275 ships
18%

Carelessness about
weather condition
144 ships
9%

Human factors
1244 ships
80%

Inappropriate
manoeuvring
245 ships
16%

Inappropriate handling ofmachinery
Inadequate
149 ships
maintenance of
9%ship equipment
110 ships
7%

Data: Japan Coast Guard
26

IMO

In 2000, IMO adopted a new requirement(SOLAS chapter V ) for all ships to carryautomatic identification systems (AISs) capableof providing information about the ship toother ships and to coastal authorities
automatically.
• all ships of 300 GT and upwards engaged oninternational voyages,• cargo ships of 500 GT and upwards notengaged on international voyages• all passenger ships irrespective of size.
Effective for all ships by 31 December 2004.
Electronic Chart Display andInformation Systems (ECDIS)←ECDIS Training
Japan Marine Science, Inc.

After the introduction of the double-hull requirements
and mandatory phase-out at the age of 25 or 30 fortankers, the requirements continued to be strengthened.
1999 Oil spill of Erica
2001 MARPOL amendments wereadopted to accelerate thephase-out of single-hulledtankers (by 2015)
2002 Oil spill of Prestige
2003 MARPOL amendments wereadopted to further accelerate
the phase-out of single-hulledtankers (by 2010)

With all these efforts made,there is no “zero” risk in this world.
“100% safety” does not exist.

Largest Oil Pollution Caused by Tanker Incidents
Vessel Name

Year,
Place

Oil spill(tons)

Damage/Loss

Torrey Canyon

1967
UK

80,000

USD 1.6billion

Nakhodka

1997
Japan

6,200

Erika

1999
France20,000

USD 210million

2002
Spain

60,000over
USD
1,000million

2007
Republic of
Korea

11,000

USD 450million

Prestige(unresolved)

Hebei Spirit

USD 250million

30

Possible Damages Caused by Oil Spill
Property
DamageWreckremovalGovernment
Local government

Marineaquaculture
Hotel
Restaurants

Fishery©The Huffington Post

Tourism

Clean-up
operation©The Huffington Post

Loss of
Earnings
Loss of option
value forgeneral public
31

There should be strict liability in order to provide
strong incentives for safer ship operation.
On the other hand, if the liability is unlimited, no one
would dare to continue shipping business.

Incidents may cause widespread damages
externally.
There should be mechanism to compensate external
pollution damages.

International Conventions related to Pollution Damage
Cause of Pollution

Persistent
Oil Carried

Oilin Bulk
as Cargo

Conventions Related to
Liability andCompensation
1992 CLC
The 1992 Fund Convention
The 2003 Protocol

Non-Persistent
Oil (=HNS)2010 HNS Convention
HNS (※) Carried
as Cargo

HNS
excl. NonPersistent Oil※ HNS : Hazardous and Noxious Substances
Oil Carriedas Fuelin Ship’s Bunker

Bunkers Convention
33

Conventions related to Persistent Oil Carried as Cargo

Cause of Pollution

Persistent
Oil Carried

Oilin Bulk
as Cargo

Conventions Related to
Liability andCompensation
1992 CLC
The 1992 Fund Convention
The 2003 Protocol

Non-Persistent
Oil (=HNS)2010 HNS Convention
HNS (※) Carried
as Cargo

HNS
excl. NonPersistent Oil※ HNS : Hazardous and Noxious Substances
Oil Carriedas Fuelin Ship’s Bunker

Bunker Convention
34

1992 CLC
◼ International Convention on Civil Liability for Oil Pollution
Damage, 1992

• Strict Liability for pollution damage except only if the
shipowner proves that;---the damage resulted from an act of war, hostilities, civil war, insurrection or anatural phenomenon of an exceptional, inevitable and irresistible character,or
the damage was wholly caused by an act or omission done with intent tocause damage by a third party, or
the damage was wholly caused by the negligence or other wrongful act of
any Government or other authority responsible for the maintenance of lights
or other navigational aids in the exercise of that function.

• Limitation of shipowner’s liability based on the gross
tonnage of the ship
• Compulsory insurance for ships carrying more than 2,000
tons of persistent oil and certificate issued by theappropriate authority of the State of their registry
stating that the ship’s liability under the Convention is35
covered1992 Fund Convention,
the 2003 Protocol(Supplementary Fund)◼ International Convention on the Establishment of anInternational Fund for Compensation for Oil Pollution
Damage, 1992 (1992 Fund Convention)◼ Protocol of 2003 to the International Convention on the
Establishment of an International Fund for Compensation for
Oil Pollution Damage, 1992 (The 2003 Protocol)• IOPC Funds(*) financed by contributions from oil
receivers in 1992 fund Member States(*)1992 Fund and Supplementary Fund

• Pay compensation when
- claims exceed shipowner’s liability under CLC, or- shipowner financially incapable of meeting its
obligations under CLC• Maximum amount of compensation 750 million SDR(*)- 1992 Fund: 203 million SDR- Supplementary Fund: 547 million SDR(*) SDR: Special Drawing Rights (1 SDR = US$1.314, as of 10 Oct, 2023)

Main Types of Claims Applicable to Funds⚫ Clean-up operations⚫ Property Damage⚫ Economic losses in fishery, marine aquaculture andtourism sectors⚫ Reinstatement of Environmental damage
To be entitled to compensation, the loss must be actualand quantifiable37

Framework of Compensation

Supplementary Fund

Pays for the claims
exceeding FC limit

Pays for the claims
exceeding CLC limit
Strict liability forshipowners

92 FundShip-owner P&I insurance

Shipowners required tomaintain compulsory
third- party liability
insurance and certificate

Source: IOPC Funds

38

Japan’s Domestic Law
Cause of Pollution

Persistent
Oil Carried

Oilin Bulk
as Cargo

HNS(※) Carried
as Cargo

Act on Liability for Oil
Pollution Damage⚫ Strict Liability of
shipowner

Non-Persistent
Oil (=HNS)⚫ Limitation of Liability

HNSexcl. NonPersistent Oil⚫ Compulsory
Conclusion ofCompensation
Contract※ HNS : Hazardous and Noxious Substances
Oil Carriedas Fuelin Ship’s Bunker

Wreck Removal⚫ Direct Claim Rights
to Insurers

40Subsidies for Removal and Clean-up cost of spilled oil
to assist local governments

Domestic policy instrument in Japan• Requirements- Oil spill occurs from a ship (with foreign flag and except oil tanker)- the JCG Commandant requests local government to remove oil spillfrom polluted water- Removal and clean-up cost of spilled oil conducted by the local
government is not paid by the shipowner• Applicable Cost ・・・ Removal and clean up cost
including related expenses• Applicant
・・・ Local government• Minimum Cost
for Application ・・・ More than ¥20,000,000• Subsidy rate・・・ 50 %• Effective date・・・ 1 April 2004

• Case examples
2005 （¥77,432,000） MV HELENAⅡ （Aomori pref.）2008 （¥15,000,000） MV AAA UFULI （Saiki city）
2009 （¥726,936,000） MV Gold Leader （Hyogo pref.,Kobe city, Akashi city, Awaji city）( HELENAⅡ)

41

IMO Contributions
Rank

State

Year 2022 Top 10 Parties
Contribution (GBP)

Share(%)

1

Panama4,831,315

14.37

2

Liberia

4,088,887

12.16

3

Marshall Islands

3,578,929

10.65

4

China

1,922,417

5.72

5Singapore

1,884,351

5.61

6

Malta

1,727,002

5.14

7

Hong Kong

1,374,268

4.09

8

Bahamas1,248,045

3.71

9

United Kingdom

1,019,253

3.03

10

Japan

870,855

2.59
42

✓Avoid an incident (tackle the cause of incident),✓Minimize the loss and damage,✓Then, rules on the liability, and compensation
to the external environment damage.

--------Have another look on the overall picture of thepolicy measures to enhance the safety at sea.

Policy-Mix
Generally, policy goals cannot be achieved by single andstand-alone instrument.
Optimum combination of different types of policies should be
used to maximize the benefits/costs.
The following categorization is generally used in the context ofenvironment policy, but applicable to the safety, as well.

◼Regulatory measures
ー Direct regulation
ー Procedural regulation◼Information measures◼Market-Based measures◼Voluntary measures

Policy-Mix◼Regulatory measures✓Direct regulatione.g., ECDIS installation, stability criteria, under SOLAS
Double-Hull requirements under MARPOL✓Procedural regulatione.g., Certification for seafarers’ training and qualification
Compulsory insurance under CLC, Bunker, Nairobi◼Information measures
Disclose the information relating to the safety performance andimprove the behavior through peer pressure: e.g., the safety
performance assessment and rating by the third party and public
report of PSC detention results

Policy-Mix◼ Regulatory measures◼ Information measures◼Market-Based Measures
The compensation of damage under strict liability, with mutual
recognition of court judgments between Parties, could be
economic incentives for safe navigation. (MBM in wider context)
However, compared to the environmental performance (e.g.,
GHG emission volume) , the safety risk for a particular ship andits operation is difficult to quantify.
◼ Voluntary measures

Policy-Mix◼ Regulatory measures◼ Information measures◼ Market-Based measures◼Voluntary measures
Owner/operator could develop its own corporate safety improvement
plan. Industry associations could develop its guidelines and code of
conducts for the safe practices.
An enterprise or a consortium of enterprises could take its own
initiatives to accelerate the technological development that enhance thesafety, possibly with the public support.
e.g., MASS (autonomous ship) has become closer to realization
through the R&D and demonstration tests conducted under MEGURI
2040 project by the Nippon Foundation

From MEGURI2040, the Nippon Foundation

Safety Guidelines for MASS
Overview of the points to consider
Operation

DesignDefining ODD(Operational
Design Domain)

Implementation of
appropriate shipmaneuvering using
AOS

Remote Operation
System (ROS)

HMI (Human
Machine Interface)setting

Maintenancemanagement of AOS

AUTO

maneuvering

AUTO

crew

AUTO
transition

Ensuring
cyber
security

Automated Operation
System(AOS)

Installation
Compliance to laws
and regulations

Documents to beprovided for
MASS

Prevention of misuse
of AOS during
operation

Ensuring cooperation
between AOS and otherequipment and facilities

AUTO

AUTO

！

Implementation ofsystem integration
tests on board

AUTO✔ -------✔ -------! --------

50
50

Policy instruments should not be considered in isolation.
As an overall picture, optimum policy-mix should be
pursued.
Despite such efforts, the risk of damage by oil spill cannot
be diminished.
Compensation scheme through the Compensation Funds
will continue to function as safeguard.
The maritime transport will never disappear, as it isessential to the daily life and survival of all citizens.
The safety at sea is an eternal challenge for everyone.

Thank you!

Shimizu Port, from a Commuting Ship of Tokai University, Shizuoka Campus“Mirai” (formerly nuclear-powered “Mutsu”) of JAMSTEC is leaving the port (right),
and “Chikyu” of JAMSTEC rests in the port (left).