Brussels, 10.12.2004

COM(2004) 801 final

2002/0259 COD

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT pursuant to the second subparagraph of Article 251 (2) of the EC Treaty concerning the

common position of the Council on the adoption of a Directive of the European Parliament and of the Council amending Directive 1999/32/EC as regards the sulphur content of marine fuels

2002/0259 COD

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT pursuant to the second subparagraph of Article 251 (2) of the EC Treaty concerning the

common position of the Council on the adoption of a Directive of the European Parliament and of the Council amending Directive 1999/32/EC as regards the sulphur content of marine fuels (Text with EEA relevance)

1- BACKGROUND

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2- OBJECTIVE OF THE COMMISSION PROPOSAL

The aim of the proposal is to reduce the impact of ships’ emissions of sulphur dioxide (SO2 or SOx) and particulate matter (PM) on environmental acidification and human health. Ship emissions of SOx and PM are directly related to fuel sulphur content. Marine heavy fuel currently has an average sulphur (S) content of 2.7% or 27,000 parts per million (ppm), compared with road fuel which has a new sulphur limit of 10 ppm. The proposal contained new limits on the maximum sulphur content of marine fuels, specifically:

- A 1.5% fuel S limit for all ships in the North Sea, Channel & Baltic Sea, in line with the SOx Emission Control Area agreed at the International Maritime Organization. This will help reduce acidification and improve air quality;

- A 1.5% fuel S limit for passenger vessels on regular services to or from any EU ports, in line with established EU policy of high standards for passenger vessels. This will improve air quality around coasts, and help ensure an EU-wide supply of low S fuel;

- A 0.2% fuel S limit for ships at berth in EU ports, and all inland vessels, to reduce local emissions of SOx and PM, and improve local air quality.

3 COMMENTS ON THE COMMON POSITION

3.1 General comments

In its amended proposal, the Commission accepted in full, in part or in principle 30 of the 36 amendments proposed by the European Parliament in its first reading. 21 amendments have now been incorporated, either verbatim or in spirit, in the common position.

The Commission accepted all the amendments which sought to clarify the scope of the proposal and its environmental benefits, the amendments which introduced more explicit arrangements for trials of alternative exhaust gas abatement technologies, and most of the amendments which brought forward implementation dates. The Commission did not accept the amendments which introduced a second phase of lower marine fuel sulphur limits for ships in all Community waters, believing this to be premature at this stage.

The Council has now agreed to incorporate most of the Parliamentary amendments which offered clarifications, and which proposed trials for exhaust gas cleaning. On implementation dates there has been an important development since the Parliament’s first reading: the International Maritime Organization’s air pollution convention, MARPOL Annex VI, has received enough ratifications to enter into force. The implementation dates in the Common Position have therefore been rescheduled to correspond with the implementation dates in MARPOL Annex VI. With regard to second phase limits, the Council has agreed to include more specific text in the review clause (Article 7), proposing to press for tighter limits at the IMO in the context of a revision of MARPOL Annex VI, and also proposing to bring forward the Commission’s report on economic instruments as a possible complementary measure.

The Commission considers that the Common Position adopted by qualified majority on 09.12.2004 does not alter the approach or aims of the Proposal and can thus support it as it stands.

3.2 Detailed comments

3.2.1 Parliamentary amendments accepted by the Commission and incorporated in full, in part or in principle in the common position

Amendments 1, 3, 4, 5, 6, 7, 8, 10, 18, 23, 27, 29, 30, 31, 33, 38, 39, 40, 43 and 44 have been incorporated to varying degrees. They provided clarifications, changed derogation provisions and set out rules for the trials and use of exhaust gas cleaning.

3.2.2 Parliamentary amendments rejected by the Commission but incorporated in full, in part or in principle in the common position

Amendment 13 was rejected by the Commission, but has been partly incorporated in the common position. This amendment proposed bringing forward the entry into force date of the passenger vessel provision. The Council decided earlier implementation was logical, so as to be in line with the entry into force of MARPOL Annex VI.

3.2.3 Parliamentary amendments rejected by the Commission and the Council and not incorporated in the common position

Amendments 22, 25, 26, 32 and 42 were rejected by both institutions and not incorporated. These amendments proposed second phase limits, and other additions felt to be unnecessary.

3.2.4 Parliamentary amendments accepted in full, in part or in principle by the Commission but not incorporated in the common position

Amendments 2, 14, 15, 16, 17, 21, 24, 28, 37 and 41 were accepted in part or in principle by the Commission but not incorporated. Most proposed tighter deadlines, which do not correspond to the implementation schedule now drawn up in line with MARPOL Annex VI.

3.2.5 Additional changes made by the Council to the Proposal

In Article 1(1), four new exemptions have been introduced for fuels used by ships which are: involved in military activities, securing the safety of life at sea, damaged, or using approved abatement technologies.

In Article 1(2), a number of new definitions are added, for MARPOL, Annex VI, warships, “placing on the market”, “outermost regions”, and “abatement technology”.

In Article 1(4), the repeal of the existing marine gas oil provisions is delayed until 2010 (including the derogation for Greece and the outermost regions which will remain until then).

In Article 1(5) on SOxECAs and passenger ships, Member States’ enforcement responsibilities are clarified, the provision requiring Member States to ensure the availability of compliant fuel is deleted, and application dates are generally altered to be in line with MARPOL Annex VI, or 12 months after entry into force of the directive, whichever is later.

In Article 1(6) the low sulphur fuel requirement for ships at berth and inland vessels is delayed until 1 January 2010. For ships at berth, flexibility is introduced “allowing sufficient time” for fuel switching, short-stay vessels are exempted, and a two-year derogation is allowed for 16 Greek passenger vessels. Inland waterway vessels are exempted while at sea.

In Article 1(7), much fuller text is included on the trials and use of new abatement technologies, including revised comitology procedures for their approval.

Article 1(8) on sampling and analysis is slightly shortened and the drafting is clarified.

In Article 1(9), the Commission report is brought forward to 2008, and its basis is revised to include trends in fuel costs, modal shift, progress at IMO and a new cost-benefit analysis of the passenger vessel provision. It may be accompanied by proposals for second stage sulphur limit values. A separate report on economic instruments is called for by 2005. The scope of the comitology procedure is limited.

Article 1(10) establishing the regulatory committee is slightly redrafted.

4- CONCLUSION

The changes introduced by the Council help to clarify the proposal and to bring its implementation into line with the IMO convention MARPOL Annex VI. They also promote the development of alternative technologies and economic instruments, and the consideration of tighter second phase limits at IMO and in the EU. The Commission therefore supports the Common Position adopted by qualified majority on 09.12.2004.