Shipping Heavyweights Say New BIMCO Clause Unfairly Burdens Charterers with CII Compliance

New CII regs target ship emissions. Image Credit: Ship & Bunker

In an open letter to BIMCO President Sabrina Chao today, a group of 23 major charterers have expressed their concerns about the recently adopted BIMCO CII Operations Clause for Time Charter Parties.

The group argues that the new clause places a disproportionate burden on charterers to comply with the upcoming CII Regulations, rather than recognizing that owners are the ones primarily responsible for compliance.

The new CII regulations come into effect on January 1, 2023 and require vessels to perform within an agreed level of CO2 emissions per dwt.

The group of 23 shipping heavyweights, most of which are also BIMCO members, represent a significant share of chartering demand and includes A.P. Moller – Maersk A/S, Norden, Hapag-Lloyd, MSC, and CMA CGM amongst others.

The same group said they voiced "serious concerns" over the BIMCO CII clause as early as April 2022, but key provisions concerning vessel performance and maintenance were not accepted in the final text.

"This makes the BIMCO clause imbalanced and unusable for the members of this group and will likely lead to a wide variety of 'home grown' CII clauses or – to owners' detriment – no clause being agreed," the group wrote.

"There are a considerable number of measures available to owners to optimize fuel consumption ... It is owners' role to optimize vessels from the technical side during every day of operation. In conjunction with that, it is charterers' role to ensure that vessels are operated as efficiently as possible.

"In circumstances where charterers' employment orders are only partly responsible for the CII rating, this group does not accept taking wholesale responsibility for compliance with the regulations. This has been one of the biggest sticking points in the discussions."

Today's pushback is not the first instance of discontent stemming from the new CII rules.

Oldendorff, who is also one group signatories, earlier this month said the upcoming CII regulation itself was flawed and could lead to more fuel being burned, and more emissions being produced.

The groups's open letter can be read in full here: https://cms.norden.com/sites/cms.norden.com/files/2022-12/Open%20Letter%20to%20Bimco%20from%20Chartering%20Interests%20-%20Dec.%2020%202022.pdf