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Over two years have now passed since the enforcement of Directive (EU) 2019/833 “on port reception facilities for the delivery of waste from ships, amending Directive 2010/65/EU and repealing Directive 2000/59/EC” (hereinafter the “Directive”) [1].
The deadline to comply with the Directive was 28 June 2021 but Italy is still in the process of transposing it.
Given the peculiarity and importance of the matter, we will try to identify what are - in our opinion - the most important aspects that the legislator should take into account when transposing the Directive.
In general, we believe that it would be necessary to:
As regards the assignment of the waste collection service to several operators, the Directive states that the waste collection service falls within the scope of application of the Regulation, so that the limitation on the number of providers of the service for the collection of ship-generated waste is only possible and, therefore, justified exclusively by ascertaining the existence of certain stringent requirements, duly assessed on the basis of an appropriate procedure pursuant to Articles 6 et seq. of the Regulation[3].
The possibility of having a plurality of service providers is confirmed by the latest developments in the case law regarding the collection of waste on board ships[4], which shows that, pending the preparation of public tender documents for the assignment of said service, the service may even be provided also by companies listed in the register pursuant to Article 68 of the Navigation Code[5] that meet the necessary requirements[6].
Without going into the detail of the case here, it is reasonable to believe that this view can fully guarantee competition between operators, through the opening to the market, on the assumption that the selection of the service operator is entrusted “to the party who will enjoy the service and to whom the relevant costs are charged, under a competitive regime”[7].
The above in order to avoid the presence of only one service provider which, by virtue of its position, could apply excessively onerous conditions in a given port, with the consequent risk of being considered as a practice restricting competition.
As regards Regulation (EU) 2017/352, the transposition decree should - in our opinion - be clear and comprehensive with regard to the concrete application of the principles of transparency, proportionality and reporting referred to in the Regulation also for the sector in question[8].
Even in the light of the above-mentioned principles, Article 8 of the Directive, entitled “Cost recovery system”, provides that Member States shall ensure that the costs of operating port reception facilities for the reception and treatment of waste from ships, other than cargo residues, are covered through the collection of a fee from ships[9].
With particular reference to the design and operation of such cost recovery systems, Article 8(2) of the Directive expressly provides - inter alia - that:
Moreover, with specific reference to the coverage of a part of the direct operating costs, equal to at least 30% of the total direct costs for actual delivery of the waste during the previous year, in our opinion it should be avoided, where the service provider in a given port is inefficient, that said percentage could in practice amount to 100% of the total direct costs.
In this latter regard, the adoption of a fee regime applying in all ports the same unit of measurement for the pricing of quantities (volume, weight, etc.), while ensuring adequate cost recovery systems as per Article 8 of the Directive, could hopefully reduce any possible unjustified and excessively onerous costs for users[14].
Therefore, the provision of an ad hoc procedure defined at inter-ministerial level and aimed exclusively at establishing adequate “criteria and mechanisms” for the fixing of fees, taking into account what has already been provided for the determination (and updating) of tariff criteria and mechanisms for technical nautical services, could also guarantee that the fee is
In said context, Article 9 of the Directive expressly provides that ships engaged in scheduled traffic shall be exempted, by way of example and without limitation, from the obligations relating to the cost recovery system where there is sufficient evidence that a number of conditions are met, such as, inter alia, “an arrangement to ensure the delivery of the waste and payment of the fees in a port along the ship’s route which is evidenced by a signed contract with a port or a waste contractor and notified to all ports on the ship’s route”.
Finally, when the decree to be enacted will come into force, considering moreover the difficulty of entering into such an agreement, ships engaged in scheduled traffic should, in our opinion, be given a period of grace to enable them to comply effectively with the stringent exemption requirements under the Directive.
In conclusion: given the temporary silence of the legislator and of course without prejudice to all the contingent situations of each port, it is evident how a targeted and careful opening up to competition of the service for the collection of ship-generated waste and cargo residues can only increase competitiveness and attractiveness of the individual Port System Authorities and their respective related industries on the national and international market.
This article is for information purposes only and is not, and cannot be intended as, a professional opinion on the topics dealt with. For further information please contact Luca Cavagnaro and Emanuele Rinaldi.
[1] The main objective pursued by the Directive is to reduce discharges at sea of ship-generated waste and cargo residues from ships calling at EU ports. Last but not least, to improve the availability and use of port reception facilities for said waste and residues.
[2] For an overview of the Regulation, you can consult some articles published in our Shipping&Transport Bulletin: “Regulation (EU) 2017/352 on port services and financial transparency: provision of port services (first part)“ (December – January 2019); “EU Regulation 2017/352 on port services and financial transparency: ”limitations” to the number of providers of port services and public service obligations (second part)“ (February – March 2019); “Regulation (EU) 2017/352 establishing a framework for the provision of port services and common rules on the financial transparency of ports: employees’ rights, financial transparency and autonomy of port management bodies“ (April – May 2019).
[3] In other words, the rule underlying the Directive seems to be the plurality of providers and the freedom to provide services in ports, with the result that, instead, the derogation from the competitive market and any intention to limit the number of port services providers would be an exception subject to the formal procedure provided for by the Regulation.
[4] Cfr. ex multis: Council of State, Fifth Division, No. 3049/2020; TAR Sardinia, Second Division, No. 282/2021.
[5] Those who carry out an activity within the port, other than port operations or services (Article 16 of Law 84/94), are subject to registration in the register referred to in Article 68 of the Navigation Code, whereby “Those who carry out an activity within ports and in general within the public maritime domain are subject, in the performance of such activity, to the supervision of the port master. The Head of the Department, after consulting the trade unions concerned, may impose on those who carry out the aforesaid activities the registration in special registers, possibly limited in number, and other special restrictions”.
[6] On this point see the article “Ship waste collection and barge bunkering services: major steps towards market opening“, in our Shipping&Transport Bulletin (November-December 2020).
[7] Council of State, Fifth Division, No. 3049/2020, recital (10).
[8] Recital (36) of the preambles to the Directive states that: “This Directive goes beyond the framework provided by that Regulation by providing more detailed requirements for the design and operation of the cost recovery systems for port reception facilities for waste from ships and the transparency of the cost structure”.
[9] The Directive also specifies that cost recovery systems shall provide no incentive for ships to discharge their waste at sea.
[10] Annex 4 to the Directive defines as indirect administrative costs those costs arising from the management of the system in the port, such as, by way of example and without limitation, cost items inherent to the “development and approval of the waste reception and handling plan, including any audits of that plan and its implementation”.
[11] Annex 4 to the Directive defines as direct operational costs those arising from the actual delivery of waste from ships, such as, by way of example and without limitation, cost items relating to the “provision of port reception facilities infrastructure, including the containers, tanks, processing tools, barges, trucks, waste reception, treatment installations”.
[12] The International Convention for the Prevention of Pollution from Ships (“MARPOL Convention”) was developed by the International Maritime Organization (“IMO”) with the aim of preventing and minimizing pollution from ships, both accidental and resulting from routine operations, and is accompanied by six technical annexes covering marine pollution. In particular, Annex V contains the rules on the prevention of pollution from ship waste.
[13] Article 8 (2)(c) of the Directive specifies that the aim of the provision is “to ensure a right of delivery without any additional charges based on the volume of waste delivered, except where the volume of waste delivered exceeds the maximum dedicated storage capacity mentioned in the form set out in Annex 2 to this Directive [..]”.
[14] Hence, in our opinion, the foregoing could not be achieved without an appropriate involvement of the users themselves (and therefore also of national trade associations) in all the preparatory and subsequent phases of the preparation of waste collection and management plans in the port area, as well as in the determination and/or updating of the relevant fees for the provision of the service.
