Keith B. Letourneau, Matthew J. Thomas, and Zachary J. Wyatte
The Baltic and International Maritime Council’s (“BIMCO”) Documentary Committee adopted several new clauses and contracts at its recent meeting held on January 25, 2021. Included were: (1) a new charter sanctions clause, (2) a clause promoting transparency and dialogue between owners and charterers, and (3) tug, barge, and floating hotel contracts. Given the prevalence of U.S. sanctions against myriad governmental and private-party actors worldwide, the scourge of the COVID-19 pandemic, and the construction advent of new offshore wind farm structures, each of these clauses and contracts warrant consideration by maritime law practitioners and commercial operators alike.
Sanctions Clause for Container Vessel Time Charter Parties 2021
In recognizing the complexity of international sanctions regimes, coupled with the fact that they consistently change as the number of new restrictions continues to increase, BIMCO issued a sanctions clause for charter parties in the container trade in an effort to assist interested parties in complying with the worldwide sanctions regulations. This new clause was designed as part of an initiative to create a library of sanctions clauses that reflect the individual needs and characteristics of different trades and operations, as well as provide greater understanding of the responsibilities assumed by owners. It is the last step in a triad of sanctions clause updates, which comes more than a year after BIMCO’s revised standard sanctions clauses for time and voyage charters. As the various shipping subsectors possess separate risks associated with different market realities, BIMCO tailored this clause to address the characteristics of the container industry, specifically to address: (1) transactions with a “Sanctioned Party,” and (2) voyages involving a “Sanctioned Cargo.”
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Thomas H. Belknap, Jr., Editor
COVID, COVID, COVID … Sometimes it feels like that is all anyone is talking about these days (especially now that the election is behind us). So, in this issue of Mainbrace, we (mostly) take a break from that topic and try to focus on some other things.
Use of new technology in the maritime industry is one subject that always interests us, and there is no shortage of pertinent topics in this space. In this issue, we present articles discussing the legal and practical issues relating to the use of facial recognition technology on cruise ships, developments in the use of blockchain in global logistics arrangements, and new regulatory developments relating to electronic recordkeeping onboard vessels.
Meanwhile, as the 116th Congress moves towards its close at the end of the year, we take a look at pending maritime-related legislation and make a few guesses as to what we might expect from the 117th Congress, which convenes in January 2021. Of particular interest to the budding offshore wind industry is a separate article looking at recent developments on proposed legislation to clarify the application of the Jones Act to offshore wind development. We also look at ongoing efforts to pass legislation to tackle the serious and expanding problem of plastics in the oceans, as well as provide an update on regulatory developments relating to the Vessel Incidental Discharge Act.
The year 2020 has become a punchline of sorts for all the things that can go wrong. There’s no question that it has been a year like no other in memory, and I am sure many of us are ready to turn a new leaf in 2021. With disruption comes opportunity, however, and it is not so difficult to envision the many ways that the hurdles of this year will jumpstart innovation and progress in the coming years. Indeed, it seems clear that we are already heading down this path. So, let this be our New Year’s wish to all our clients and friends: may you stay ahead of the curve and figure out how to turn problems into solutions. We look forward to being there to help you do just that in 2021 and beyond. Happy Holidays to all.
Jonathan K. Waldron, Joan M. Bondareff, and Stefanos N. Roulakis
The end of 2020 has seen significant developments in legislation with implications for the maritime industry as we move from the Trump administration to the new Biden administration. This article provides an update on the status of several key maritime-related bills in the 116th Congress as of December 7, 2020.
The incoming Biden administration has not developed specific bills yet, but we anticipate infrastructure being at the top of the list. This will provide a number of opportunities for the maritime industry—from expanding title XI loan guarantees to funding for port infrastructure projects, new vessels for new offshore wind projects, and an expansion of cargo preference to support the Jones Act. Of import, Biden’s campaign voiced his support for the Jones Act.
Key Maritime Bills Expected to Be Enacted in the 116th Congress
National Defense Authorization Act (“NDAA”)
The NDAA is roundly considered to be an annual “must-pass” bill, having passed every year since the Kennedy administration. In recent years, many maritime provisions have been included in the NDAA. The reason for this is that, as an essential bill that is enacted every year, the NDAA creates opportunity for the advancement of policy priorities in the maritime industry if they are included. The House and Senate have agreed to a conference report for the NDAA and the final bill will include significant maritime provisions, including U.S. Maritime Administration (“MARAD”) reauthorization, U.S. Coast Guard (“USCG”) reauthorization, extension of the Jones Act and other federal laws to offshore renewable energy, and funding for ports to address COVID-related emergencies. A few of these bills are summarized below and more details will be addressed in a follow-up maritime advisory.
Continue reading “Maritime Legislative Update”
Keith B. Letourneau and Vanessa DiDomenico*
Blockchain technology ensures security and transparency within transactions. The endless possibilities and solutions that blockchain can provide to a multitude of industries and consumers created a surge of interest over the past several years. Recently, the need for blockchain technology was amplified when a single microbe showed just how interconnected the world is and how fragile supply-chain networks and logistics providers are when unexpected demand for critical goods (personal protective equipment and testing kits) arose due to the COVID-19 pandemic.
Global Supply-Chain Disruption
The various levels of regulations imposed by national and local governments throughout the world because of COVID-19 concerns delayed and disrupted virtually all supply-chain networks. For example, customs clearance processes have become more laborious and many factories have converted into producers of essential equipment, resulting in the delayed assembly of integral components relied upon by other manufacturers.
Before the global pandemic, companies were racing to become as lean as possible, cutting costs and sourcing multiple components from a variety of manufacturers in different countries. Reducing the costs of making a product would allow for more profit. Producers and manufacturers used complex supply-chain networks to maximize comparative advantage strategies. Often, products would be shipped to another country merely to perform a certain task, or to simply add a singular component, and then the item would be returned to origin for sale to a consumer. Continue reading “The Impact of COVID-19 on Blockchain Advancement”
Jonathan K. Waldron and Stefanos N. Roulakis
The House of Representatives passed legislation, H.R. 4447, the Expanding Access to Sustainable Energy Act of 2019, on September 24, 2020, that included a provision from Representatives Garamendi and Lowenthal (“Amendment 33”) to amend the Outer Continental Shelf Lands Act (“OCSLA”) that would confirm the Jones Act applies to all offshore energy development on the Outer Continental Shelf (“OCS”), including wind energy. Passage of this provision now appears imminent, as it has been recently included in the National Defense Authorization Act (“NDAA”). From an operational standpoint, while most offshore projects are planned with Jones Act compliance in mind, enactment of this provision would be a welcome development to stakeholders and bring needed clarity to renewable energy development offshore.
The Coastwise Merchandise Statute, commonly known as the Jones Act, has evolved over time. The U.S. cabotage laws date back to the founding of the Republic and were enshrined in their current form in the Merchant Marine Act of 1920. These were originally laws that dealt with transportation issues for domestic voyages. However, as time progressed and production of marine resources became feasible, the U.S. Congress passed OCSLA, which extended federal law to installations on the OCS.
Continue reading “New Legislation to Apply the Jones Act to Offshore Renewables”
Jeanne M. Grasso and Dana S. Merkel
On October 26, 2020, the U.S. Environmental Protection Agency (“EPA”) formally published in the Federal Register its long-anticipated standards for discharges incidental to the normal operation of vessels pursuant to the Vessel Incidental Discharge Act (“VIDA”). Signed into law on December 4, 2018, as part of the Frank LoBiondo Coast Guard Authorization Act of 2018, VIDA established a new framework for the regulation of discharges incidental to the normal operation of vessels in an attempt to bring uniformity, consistency, and certainty to the regulation of discharges from U.S.-flag and foreign-flag vessels. Comments were due November 25, 2020, and the comment period is now closed.
The first step in implementing VIDA requires the EPA to develop federal performance standards for “marine pollution control devices,” which includes any equipment or management practice (or combination thereof) to manage incidental discharges from vessels. The EPA’s proposal sets standards for 20 types of vessel discharges incidental to normal operations. The program implemented under VIDA will replace the EPA’s Vessel General Permit and certain U.S. Coast Guard (“USCG”) regulations for ballast water a few years from now, after the USCG finalizes regulations to implement the EPA’s standards, including compliance, monitoring, inspections, and enforcement.
VIDA was the culmination of years of discussion, debate, and litigation concerning discharges incidental to the normal operation of vessels. Although back in the 1970s, the EPA initially exempted these discharges from the Clean Water Act’s National Pollutant Discharge Elimination System permitting program due to the burden of permitting every vessel entering U.S. waters, a federal court held in 2006 that the EPA must issue permits for vessel discharges. In response, the EPA developed the 2008 Vessel General Permit (“VGP”). The 2008 VGP was eventually replaced by the 2013 VGP, which contained some more stringent requirements, such as numeric limits on ballast water discharges, a requirement to use environmentally acceptable lubricants, and new monitoring requirements for ballast water, bilge water, and graywater.
Continue reading “EPA Publishes Its Long-Anticipated VIDA Proposed Rule”
Jeffrey N. Rosenthal, David J. Oberly, Jeanne M. Grasso, and Douglas J. Shoemaker
In the past few years, the commercial use of facial recognition technology has advanced at an explosive rate, expanding into numerous industries and trades. For instance, facial biometrics is increasingly relied on by airlines and airports across the globe; a similar trend is starting to take hold in the maritime industry, particularly in the cruise sector.
While this expansion is occurring, states and cities across the country—as well as the federal government—are attempting to enact strict laws regulating the use of facial recognition technology by commercial entities. Facial recognition has also recently emerged as an increasingly popular target for bet-the-company privacy class action litigation.
As the cruise industry moves toward the widespread adoption of facial recognition technology, companies should implement robust, adaptable biometric privacy programs to ensure compliance with today’s growing body of law to reap the benefits of this exciting technology while mitigating liability exposure.
Overview Facial Recognition Technology
Facial recognition technology involves the use of facial “biometrics”—i.e., the individual physical characteristics of a person’s face—to digitally map one’s facial “geometry.” These measurements are then used to create a mathematical formula known as a “facial template” or “facial signature.” This stored template/signature is then used to compare the physical structure of an individual’s face to identify that individual.
Continue reading “Cruise Industry Compliance Tips: Enhancing the Traveler Experience with Facial Recognition”
Joan M. Bondareff and Dana S. Merkel
Long-awaited amendments to the International Convention for the Prevention of Pollution from Ships (“MARPOL”) entered into force on October 1, 2020, which expressly permit the use of electronic record books for certain MARPOL-required logs. Although the United States reserved its decision regarding adoption of the amendments when they were approved by the International Maritime Organization (“IMO”) in May 2019, the United States ultimately accepted their adoption in accordance with the tacit acceptance procedure. This is a significant and welcomed development.
Electronic record books have been the subject of much debate and consideration at the IMO and within the United States for a number of years. During MEPC 74 in May 2019, amendments were approved, revising MARPOL Annexes I, II, V, and VI to allow the use of electronic record books approved by the vessels’ Administration for the Oil Record Book (“ORB”), Cargo Record Book, Garbage Record Book, and Annex VI air pollution prevention recordkeeping requirements. In adopting the amendments, the IMO stated the use of electronic record books “should be encouraged as it may have many benefits for the retention of records by companies, crew, and officers.” These amendments entered into force on October 1, 2020, although a number of flag States believed the previous MARPOL language provided them with the discretion to allow the use of electronic record books and had already approved their use on vessels for some years. Even so, the permissibility of using electronic record books to meet MARPOL requirements is now clear.
Continue reading “MARPOL Electronic Recordkeeping—Finally a Reality”
Joan M. Bondareff and Dana S. Merkel
As the inveterate pundit Pogo once said, “We have met the enemy and he is us.” This could very well be said for our disposable society, which uses and disposes tons of plastic in ways that are not wise and negatively impact the health of our oceans and sea life within. Although many reports focus on larger plastics, microplastics, which go largely unnoticed, are also wreaking havoc on our oceans. Microplastics are small pieces of plastic that come from a variety of sources, both from degradation of larger plastics and from tiny manufactured plastics that are added to many health and beauty products as exfoliants. Recent surveys by Australian scientists estimate that there are at least 14 million tons of microplastics on the ocean floor, with higher concentrations where plastics accumulate at the surface of the water.
Finding a Solution
Scientists are working hard to find a solution to the plastic problem—particularly the fact that plastic never completely breaks down, but rather only breaks into smaller and smaller pieces. A number of new and interesting ideas have been proposed, such as plastic-eating caterpillars and super enzymes. However, until we have a better system for breaking up plastics harmlessly, we need to develop plans for reducing and recovering marine plastic waste.
Continue reading “Marine Plastic Pollution”
Blank Rome LLP is pleased to announce that our Firm was nationally ranked in 29 practice areas and regionally ranked in 79 practice areas in the 2021 “Best Law Firms” survey by U.S. News & World Report – Best Lawyers.®
Earlier this year, Blank Rome was also recognized in the 2021 Best Lawyers in America survey, which ranked 114 of our attorneys in the annual categories of “Lawyers of the Year” and “Best Lawyers,” as well as the inaugural “Ones to Watch” category, in 49 practice areas across 10 regions.
NATIONAL 2021 RANKINGS
- Admiralty & Maritime Law
- Banking and Finance Law
- Bankruptcy and Creditor Debtor Rights / Insolvency and Reorganization Law
- Commercial Litigation
- Corporate Law
- Criminal Defense: White-Collar
- Employee Benefits (ERISA) Law
- Insurance Law
- Litigation – Bankruptcy
- Mergers & Acquisitions Law
- Real Estate Law
- Tax Law
- Trusts & Estates Law
Continue reading “Blank Rome Highly Ranked in U.S. News – Best Lawyers® 2021 “Best Law Firms””