London P&I Club advocates old-school approach to identifying problems

THE London P&I Club says its Ship Inspection Programme has revealed a frequent failure to observe basic onboard procedures, with potentially costly consequences for owners and operators.

In the latest issue of its StopLoss Bulletin, the club says, “With increased commercial pressure on the master of a ship, some simple and potentially ‘old-school’ habits often fall by the wayside. For instance, we consider that one of the most useful tools for maintaining a quality operation and safe working environment is the weekly captain’s rounds.”

The club cites examples of issues that may slip past the daily team, but be spotted by the master. These include an untidy paint locker with opened and part-used tins of paint lying around, presenting a fire risk, mooring ropes left uncovered on mooring drums, open to degradation in sunlight, and a perished rubber gasket on the engine room escape hatch.

The club says, “Many findings identified during a ship inspection are easily detectable by the ship’s officers and crew. It is relatively rare that findings are latent. The master is the overseeing eye, carrying enhanced responsibility for all shipboard activities, coupled with a motivating role as the ship’s focal point.

“Not all ships’ operational programmes allow for regular ‘Sunday Routines’ but, when an opportunity exists, an hour spent touring the ship with the chief officer can enable the master to detect housekeeping issues as they develop. The experienced eye of the master can not only detect these issues at an early stage, but can also help the chief officer populate the weekly job list.”


www.londonpandi.com

ITIC puts members on alert after uncovering fraudulent diversion of cash

International Transport Intermediaries Club (ITIC) has warned its members to perform proper bank account checks when transferring funds to principals and intermediaries.

The warning comes following the fraudulent diversion of a significant sum of cash transmitted in good faith by ship agents to the master of a ship. The ship agents received a request from a shipowner to deliver $45,000 in cash to the ship’s master during an upcoming port call. The funds were remitted and received by the agents who, a few days later, received a call from a supply company and then from the master asking that, rather than delivering the full amount to the master, they should first deduct part of the amount as payment for fresh provisions, to be delivered to the ship during its stay at the port.

The ship agents agreed, as it was not an unusual request, and they subsequently received email confirmation from the master, copying-in the shipowner. A few days later the master confirmed that the actual amount to be delivered on board was $23,000, adding that the remaining funds should be remitted to the supply company as settlement for provisions. This email contained a preliminary delivery note signed by the ship supply company.

Later that week, the ship agents received a message from the master explaining that he expected the provisions to be delivered at 1800hrs the same day, and outlining the denomination of the funds required. This email had the ship supply company in copy and was sent as a reply to previous messages regarding the provisions and cash to master.
However, it transpired that the email had not been sent by the master, but rather had originated from a very similar - but crucially different - email address. This was not spotted by either the agents or the ship supply company.

The agents received an invoice with banking details bearing the ship’s stamp and master’s signature, together with the stamp and signature of the ship supply company. The email attaching the documentation appeared to have the ship supply company in copy, but in fact the email address - again unnoticed by the unsuspecting parties - was slightly different.

The money had in fact been remitted to a party which had intercepted the communication chain and fraudulently obtained the funds. ITIC reminds its members that, when transferring funds, they should use the telephone to check the account details with a trusted representative at the recipient’s office.

ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com


For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com

Shipping confidence dips but investment appetite remains undimmed

Shipping confidence dipped slightly in the three months to end-November 2018, according to the latest Confidence Survey from international accountant and shipping adviser Moore Stephens.

The average confidence level expressed by respondents fell to 6.0 out of a maximum score of 10.0, compared to the 6.3 recorded in August 2018.

Confidence on the part of all main categories of respondent was down, with the exception of brokers, where the rating increased from 4.9 to 5.2. Owners’ confidence fell to 6.4 from 6.8, which was originally the second highest achieved by this category of respondent in the life of the survey. The confidence rating for managers, meanwhile, was down from 6.2 to 6.0 and that for charterers from 7.0 to 6.8. The survey was launched in May 2008 with an overall rating for all respondents of 6.8 out of 10.0.

Confidence was down in Europe, from 6.2 to 6.1, and in North America, from 6.8 to 5.2, but held steady in Asia at 6.3, equalling the highest rating achieved over the past 12 months.

The likelihood of respondents making a major investment or significant development over the next 12 months was unchanged at 5.5 out of a maximum score of 10.0. Owners’ confidence was down from 6.5 to 6.3, but that for charterers was up from 4.0 to 6.6. Expectations of major investments were up in Asia from 6.1 to 6.2, but down in Europe from 5.3 to 5.2.

The number of respondents who expected finance costs to increase over the coming year was up from 59% to 67%. The figure for owners was up from 70% to 71%, while the figures for charterers and managers were up from 50% to 80%, and from 45% to 63% respectively. The rating for brokers was unchanged at 71%.

Competition, identified by 21% of respondents, overtook demand trends (20%) as the factor expected to influence performance most significantly over the next 12 months, with finance costs (16%) in third place.

The number of respondents expecting higher freight rates over the next 12 months in the tanker market was up by seven percentage points on the previous survey to 60%, while those expecting lower rates was up from 9% to 12%. In the dry bulk sector, expectations of rate increases were unchanged at 38%, accompanied by a four percentage point increase to 15% in the numbers anticipating lower rates. The numbers expecting higher container ship rates, meanwhile, fell by one percentage point to 25%, compared with 24% anticipating lower rates. Net freight rate sentiment in the tanker sector was +48, in dry bulk +23, and container ships +1.

In a stand-alone question, 24% of respondents said they expected the price differential between high-sulphur fuel oil and IMO-compliant low-sulphur fuel oil at 1 January 2020 to be between $250 and $324 per metric tonne. 23% put the figure at between $175 and $249, while 18% estimated it at between $325 and $399. 12% thought the cost differential would be between $100 and $174.

Richard Greiner, Moore Stephens Partner, Shipping & Transport, says: “It is disappointing to close the year with a small downward tick in confidence. But shipping is nothing if not volatile, and there will always be ups and downs. We should not forget, either, that it was in 2018 that confidence reached a four-year high.

“It is encouraging to see that the appetite for new investment was not deterred by the drop in confidence. New investment is something that will clearly be needed moving forward, not least to fund expenditure on the technology necessary to achieve compliance with existing and evolving regulatory requirements, and this against a backdrop of rising finance costs over the coming year.

“It is noteworthy that almost a quarter of our survey respondents thought the price differential between high-sulphur fuel and IMO-compliant low-sulphur fuel come 1 January 2020 would be between $30 and $100 per metric tonne more than it is at present.

“Increased costs are inevitable. Increased earnings are essential.”

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 614 offices of independent member firms in 112 countries, employing 30,168 people and generating revenues in 2017 of $2.9 billion. www.moorestephens.co.uk/shipping-transport

For more information:
Richard Greiner
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
richard.greiner@moorestephens.com

Wikborg Rein appoints new shipping and energy partners in London

LEADING international law firm Wikborg Rein has appointed two new partners and a senior lawyer to its Shipping, Trade, Energy & Infrastructure team in London.

Renaud Barbier-Emery, who joins Wikborg Rein as a partner from Ince & Co, is a specialist in the energy, maritime and international trade sectors on both transactional and contentious matters. His practice focuses on the development and financing of offshore energy projects, most frequently for the publicly listed owners of large fleets of drilling units, FPSOs and LNG vessels.

Renaud also acts for shipowners, shipbuilders, financiers and investors on a range of transactions involving the construction, conversion, repair, sale & purchase, leasing, chartering, management and financing of vessels, as well as advising on joint ventures. In addition, he advises on a wide range of transactional trade finance matters.

Renaud recently participated as part of the Wikborg Rein team which advised Belgian gas carrier operator Exmar on its agreement with Argentina’s YPF for the long-term deployment at Bahia Blanca of the Caribbean FLNG unit, now renamed Tango FLNG, to produce and export LNG from Argentina.

Jonathan Goldfarb, who also joins as a partner from Ince & Co, specialises in energy and trading projects across the oil and gas and renewables sectors. He advises on project tendering, vessel construction and conversion, and financing, sale and purchase and leasing arrangements for FPSOs, FSOs, FSRUs, LNGCs, FLNG, drilling units and drillships.

Jonathan also acts for international traders in relation to structured trade finance transactions and trading projects. He represents some of the world’s largest contractors and energy traders, as well as financing banks, and handles a wide variety of projects in the energy and trading sector. He has been particularly active on Floating Storage and Regasification (FSRU) projects in the LNG sector.

Meanwhile, senior lawyer Ina Lutchmiah has also joined Wikborg Rein from Ince & Co. Ina has particular expertise in LNG projects and other offshore energy transactions, and her experience includes advising on the decommissioning and recycling of offshore assets and long-term charters for FSRU projects.

Chris Grieveson, manager partner of Wikborg Rein’s London office, says, “We are delighted to welcome Renaud, Jonathan and Ina to our team. Their appointments continue Wikborg Rein’s policy of recruiting experienced and respected industry professionals who will strengthen still further the firm’s reputation as a leading specialist in the shipping and energy sectors.”


Wikborg Rein's London office was established in 1987. The office specialises in shipping, energy, construction, international arbitration and all other forms of dispute resolution. In addition, it handles financing, corporate and cross-border transactions. The London office has both English and Norwegian lawyers who all possess broad expertise within Wikborg Rein's specialist areas. The London office is also the hub of the firm’s international English law practice focusing on shipping, energy and construction matters worldwide. www.wr.no