EU The ‘Fit for 55” package and shipping. It’s getting closer.

The EU’s ‘Fit for 55’ package, aimed at achieving a 55% reduction of greenhouse gases within the Union by 2030 over a 1990 baseline, was first published on 14 July 2021. Three proposed pieces of legislation will have an impact of shipping trading into and out of ports in an EU Member State and are coming very close to adoption.

1. Inclusion of shipping in the Emissions Trading Scheme. The Commission’s initial proposal included in the “Fit for 55” package was subject to amendments, on which a preliminary agreement was reached by the Council and Parliament on 18 December 2022,, with full publication of the amended Directive on 8 February 2023

On 18 April 2023, the legislative proposals were approved by the European Parliament, and on 25 April 2023 they were adopted by the Council. Once the new provisions are published in the Official Journal of the European Union, they will become law. The ETS will then apply to Shipping as from 1 January 2024.

2. FuelEU Maritime Regulation

The Commission proposed a Regulation mandating cuts from 2025 to 2050 to GHG intensity of energy used on board ships calling at ports within Member States of the European Union. The TRAN committee adopted the draft report of the TRAN rapporteur on the proposal on 3 October 2022. While keeping the Commission’s proposed cuts for 2025 and 2030, the report introduced higher cuts to GHG intensity of energy used on board ships than proposed by the Commission from 2035 onwards – 20% as of 2035, 38 % from 2040, 64 % as of 2045 and 80% as of 2050. It also introduces a target of 2% for the use of renewable fuels of non-biological origin from 2030. A dedicated Ocean Fund should be established to improve the energy efficiency of ships and support investment aimed at helping decarbonise maritime transport. Parliament adopted the report in Plenary on 19 October 2022.

On 23 March 2023, Parliament and Council reached a provisional agreement on the text of the new rules, which now needs to be formally approved by both institutions.

3. Regulation for the deployment of alternative fuels infrastructure (AFIR).

Maritime ports that see at least 50 port calls by large passenger vessels, or 100 port calls by container vessels, must provide shore-side electricity for such vessels by 2030. The amended AFIR is now consistent with the provisions in the FuelMaritime EU Regulation on shore-side electricity.

On 28 March 2023 the European Council and the European Parliament came to a provisional political agreement on the AFIR and is subject to formal approval by the two co-legislators.

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Professor Simon Baughen

Professor Simon Baughen was appointed as Professor of Shipping Law in September 2013 (previously Reader at the University of Bristol Law School). Simon Baughen studied law at Oxford and practised in maritime law for several years before joining academia. His research interests lie mainly in the field of shipping law, but also include the law of trusts and the environmental law implications of the activities of multinational corporations in the developing world. Simon's book on Shipping Law, has run to seven editions (soon to be eight) and is already well-known to academics and students alike as by far the most learned and approachable work on the subject. Furthermore, he is now the author of the very well-established practitioner's work Summerskill on Laytime. He has an extensive list of publications to his name, including International Trade and the Protection of the Environment, and Human Rights and Corporate Wrongs - Closing the Governance Gap. He has also written and taught extensively on commercial law, trusts and environmental law. Simon is a member of the Institute of International Shipping and Trade Law, a University Research Centre within the School of Law, and he currently teaches at Swansea on the LLM in:Carriage of Goods by Sea, Land and Air; Charterparties Law and Practice; International Corporate Governance.

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