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  • MANAGING MAJOR MARINE CASUALTIES IN THE 21ST CENTURY: A WHOLE NEW BALL GAME

    3RD ASIA MARINE CASUALTY FORUM 11 APRIL 2019

    MICHAEL RITTER T: +44 20 7264 8449 E: [email protected]

    TOBY STEPHENS T: +65 6411 5379 E: [email protected]

    A Case Study of “SANCHI” c/w “CF CRYSTAL”

  • THE OLD SCHOOL

    CASUALTIES IN THE 20TH CENTURY

  • WHAT HAS CHANGED?

    CASUALTIES IN THE 21ST CENTURY

    • Communications

    • Email!

    • SCOPIC

    • Greater Governmental Intervention:

    • Local Government

    • Regional Government

    • National Government

    • Investigations:

    • Flag State

    • Port State

    • ISM

    • Charterers / Oil Majors

  • GREATER ENVIRONMENTAL PRESSURE

    WHAT HAS CHANGED?

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    LOF Cases 1993 - 2017

    WHAT HAS CHANGED?

    Based on reported LOF’s to Lloyds Salvage Arbitration Branch

    ALTERNATIVE CONTRACTS

  • LAW IS EVOLVING

    WHAT HAS CHANGED?

    • “CMA CGM LIBRA”: Vessel

    unseaworthy due to poor

    passage planning

    • Liability regimes are

    evolving

    • Legal Systems are more

    sophisticated

  • NOWHERE TO HIDE!

    WHAT HAS CHANGED?

    marineinsight.comvesseltracking.net

  • “MSC NAPOLI”

    WHAT HAS CHANGED?

  • CLEANUP COSTS

    WHAT HAS CHANGED?

  • “MAERSK HONAM”

    WHAT HAS CHANGED?

  • SANCTIONS

    WHAT HAS CHANGED?

    ©finance.yahoo.com

  • SOCIAL MEDIA

    WHAT HAS CHANGED?

  • THE IMPACT ON REPUTATION

    WHAT HAS CHANGED?

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    0 5 10 15 20 25 30S h

    a re

    p ri

    c e :

    a s a

    p e rc

    e n

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    Days after attack is annoucned

    Market Response to Cyber Attacks JP Morgan Ebay

    Sony

    Barclays

    TalkTalk

    Maersk

    Rosneft

    WPP

    FedEx

    Merck

    Yahoo! (owned by Verizon) Bell

    Equifax

  • IMMEDIACY OF RESPONSE

    WHAT HAS CHANGED?

  • HFW CRISIS MANAGEMENT CENTRES

    OUR GLOBAL NETWORK

    LONDON

    PARIS

    GENEVA

    BRUSSELS

    PIRAEUS

    SÃO PAULO

    DUBAI

    RIYADH

    KUWAIT

    SHANGHAI

    SINGAPORE

    HONG KONG

    MELBOURNE

    HOUSTON

    HFW CRISIS MANAGEMENT

    CENTRES

    HFW OFFICES

    HFW ASSOCIATION OFFICES

    JAKARTA

    RIO DE JANEIRO

    ABU DHABI

  • “SANCHI” C/W “CF CRYSTAL”

    A CASE STUDY

    3RD ASIA MARINE CASUALTY FORUM 11 APRIL 2019

    MICHAEL RITTER T: +44 20 7264 8449 E: [email protected]

  • LOC INVOLVEMENT

    HFW INVOLVEMENT

  • CASUALTY UNFOLDING

    M/T SANCHI SALVAGE

    Urgent Transmission from Lloyd's List Intelligence Casualty Reporting Service Message Generated 07:02:25 07-Jan-18 UK Time

    SANCHI (Panama) CF CRYSTAL (Hong Kong) London, Jan 7 -- A press report, dated today, states: Crude oil tanker Sanchi (85462 gt, built 2008), with 32 crew members

    on board and carrying 136,000 tonnes of fuel to South Korea, was involved in a collision with bulk carrier CF Crystal (41073

    gt, built 2011), with 21 crew members on board and carrying 64,000 tonnes of grain from the United States, en route to the

    Guangdong Province in China, around 160 nautical miles east of the mouth of the Yangtze River, at 2000 hrs, local time, Jan

    6. The incident caused a massive fire on board Sanchi forcing the tanker to tilt to the right. Thirty two sailors from vessel

    Sanchi remain missing, which includes 30 Iranians and two Bangladeshis. The emergency operation were continuing this

    morning…..

  • Location of the Casualty

    • Chinese, Japanese and Korean interests

    • Collision and wreck location – international waters, Chinese or Japanese EEZ?

    • Pollution

    • Managing a casualty in China

    ROLE OF POLITICS / GOVERNMENT

    M/T SANCHI SALVAGE

    19

  • ROLE OF POLITICS / GOVERNMENT

    M/T SANCHI SALVAGE

    • Choice of contractor

    • Decision making

    • Access and information sharing

    – Control of the Casualty Site

    – ITOPF

    • Flag & port state investigations

    – Stakeholders

  • • Location of the collision and wreck

    – Mobilisation time

    – Communications ashore

    • 24/7 or daylight firefighting

    – Expertise

    – Authority Direction

    • Availability of resources

    – Fi-fi Foam and/or Pyrocool

    • Difficulty of access

    – Search & Rescue

    – Repatriation

    GEOGRAPHICAL / PHYSICAL ISSUES

    M/T SANCHI SALVAGE

    21

    Shana News Agency

  • POTENTIAL COMPLICATIONS DUE TO IRANIAN INVOLVEMENT

    Strict legal position / Sanctions

    • JCPOA Articles 36 and 37

    • President Trump announcement 8 May 2018

    • Executive Order 13846 of 6 August 2018

    • Re-imposition of US secondary sanctions

    – 180 day wind down ended on 4 November

    – Sanctions reintroduced on, amongst others, petroleum, petroleum products, petrochemicals

    – Prohibition … assisting or providing goods or services / significant support to … person determined to be part of the energy, shipping and shipbuilding sectors / underwriting services

    THE SANCTIONS BACKDROP

    M/T SANCHI SALVAGE

    22

  • THE SANCTIONS BACKDROP

    M/T SANCHI SALVAGE

    Potential Complications due to Iranian involvement

    • MAMANCOCHET MINING LIMITED v. AEGIS MANAGING AGENCY LIMITED AND OTHERS [2018] EWHC 2643 (Comm)

    • Banking / commercial position

    • Potential impact on casualty response

    – Payment

    – Security

    • Impetus for Settlement – 05/11/18

  • LOF

    • 6 January 2018 with SCOPIC invoked 7 January 2018

    Wreckhire

    • 24 January 2018

    • Addenda No. 1 to 3

    – Bunker Removal Addendum – April 2018

    – Eyeball ROV – May 2018

    • Variation Orders 1 to 8

    • Ad hoc agreements

    Issues regarding termination and transition

    • Clause 9(iii)

    • Clause 8(c)

    TRANSITION TO WRECK REMOVAL – ENGLISH LAW CONTRACTS

    M/T SANCHI SALVAGE

    24

    Chinese Ministry of Transport via AP

  • • Technical difficulties and bespoke solutions

    – Edge of technical capability

    – Contractors, Experts and Owners collaboration

    – Bespoke equipment manufacture – investment

    • Proving a negative

    – Where did the bunkers and cargo go?

    – Contrast to other cases – a new standard?

    – Extensive investigations and extensions to services

    NO “OFF THE SHELF SOLUTION” AND PROVING A NEGATIVE

    M/T SANCHI SALVAGE

    25

  • HFW CRISIS MANAGEMENT CENTRES

    OUR GLOBAL NETWORK

    LONDON

    PARIS

    GENEVA

    BRUSSELS

    PIRAEUS

    SÃO PAULO

    DUBAI

    RIYADH

    KUWAIT

    SHANGHAI

    SINGAPORE

    HONG KONG

    MELBOURNE

    HOUSTON

    HFW CRISIS MANAGEMENT

    CENTRES

    HFW OFFICES

    HFW ASSOCIATION OFFICES

    JAKARTA

    RIO DE JANEIRO

    ABU DHABI

  • ©2019 Holman Fenwick Willan LLP. All rights reserved

    Whilst every care has been taken to ensure the accuracy of this information

    at the time of publication, the information is intended as guidance only.

    It should not be considered as legal advice.

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