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Federal regulatory agency ANTAQ issued an injunction order suspending the enforcement of the new regulation introduced by the Santos Port Authority
Update 9 September 2024: the Santos Port Authority issued a press release reluctantly accepting ANTAQ ruling; however, it has stated its intention to seek reconsideration of the suspension of the new regulation. A copy of the document with an English translation can be downloaded here.
New requirement
As this circular outlines, the Santos Port Authority (APS) has implemented a new “Standard for Control of Management and Conformity of Ballast Water from Ships Operating in the Organised Port of Santos”, coded NAP.SUMAS.OPR.023.2024. It requires all vessels calling at Latin America’s largest port complex to submit to the APS a statement of compliance, known as an AC-BWM, issued by a private company accredited by the APS proving adherence to the IMO BWM Convention and its domestic regulation by the Brazilian Navy’s Directorate of Ports and Coasts (DPC) through the “Maritime Authority Standards for the Prevention of Environmental Pollution Caused by Ships and Platforms” NORMAM-401/DPC.
Under the new regulation, which took effect on 21 August 2024, ships that fail to produce an approved AC-BWM will not be permitted to enter the port and berth for cargo operations. It provided a 12-month grace period within which ships with a failed AC-BWM can still operate. Non-compliance would, nevertheless, be reported to the local maritime authority. Owners whose ships have failed the certification are entitled to appeal through adversarial proceedings with a full right of defence.
Agents must apply for the AC-BWM at least 24 hours before the vessel arrives at Santos. The certification is valid for only one call.
At present, only one company has been accredited by the APS. It charges a fee of USD 1,390 for ships whose agents are affiliated with the local union of shipping agents (Sindamar) and USD 1,700 for non-members.
Shipping community reaction
APS new regulation has sparked adverse reactions from the shipping community, including the International Chamber of Shipping (ICS). The move has raised concerns over potential operational delays, increased administrative burden due to duplicated ballast water reporting requirements, and higher costs. This could negatively impact the competitiveness and ultimately lead to a freight hike. There is also a worry that other port authorities would follow suit.
ANTAQ injunction order
The National Centre of Transatlantic Navigation (Centronave), a union of foreign shipping lines operating in Brazil, and the Brazilian Association of Cabotage Shipowners (ABAC) filed a complaint to the National Agency of Waterway Transport (ANTAQ) highlighting the following main points:
- Although the regulation was issued in May 2024, only in August 2024 did APS inform the local shipping community about it
- APS addressed none of the formal inquiries made by the local Union of Shipping Agents (Sindamar), Santos Board of Trade (ACS), and Centronave seeking clarification on various aspects of the new requirements
- APS accredited just one company, offending the rules of public service tendering, despite APS being a state-owned dock company
- The regulation extrapolates APS’ competence and encroaches on the jurisdiction of the maritime authority, which is the federal entity responsible for enforcing the BWM Convention in Brazil
- Without consulting the proper regulatory agency, ANTAQ, APS created a new port tariff that significantly impacts the economy
- The fees charged by the APS-accredited company do not conform to the principle of moderate tariffs provided for in the Law of the Ports and the principle of legality enshrined in the Federal Constitution
On 4 September 2024, ANTAQ acknowledged the arguments presented by Centronave and ABAC and issued an injunction order inaudita altera parte (without hearing the other party), immediately suspending the enforcement of regulation NAP.SUMAS.OPR.023.2024, as well as collection of any fees, as it conflicts with the maritime authority’s standards and regulations. APS was given a 30-day deadline to challenge the decision.
ANTAQ also referred the dispute to the DPC and invited the maritime authority to contribute to the decision regarding the complaint’s merits.
A plenary session of the ANTAQ board will render the ultimate decision at the administrative level.
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