FMC launches probe of Canadian ballast water regs

Pending Canadian ballast water management regulations have been slammed as “the epitome of an unfair business practice,” by the U.S. based Lake Carriers Association (LCA), which filed a petition asking the Federal Maritime Commission (FMC) to investigate the issue back in March 2020.

The FMC responded and today launched an investigation to determine if pending Canadian regulations governing ballast water management systems of ships in the U.S.-Canada Great Lakes trade have a disparate effect on U.S. flagged vessels and constitute a Foreign Shipping Practices violation under 46 U.S.C. Chapter 423.

The FMC notes that U.S.-based companies operating ships in the U.S.-Canada Great Lakes trade maintain that Canadian ballast water regulations taking effect as to some vessels in September 2024 impose a severe burden on their operations and put American companies and vessels at a disadvantage relative to their Canadian competitors.

The Commission is authorized to investigate whether the laws, rules, regulations, policies or practices of another nation result in conditions that adversely affect the operations of United States carriers in the United States oceanborne trade.

The Commission has determined that sufficient facts exist related to the Canadian ballast water regulations to warrant initiating a Foreign Shipping Practices investigation. The investigation will be led by the Commission’s General Counsel, who will prepare and present a report to the Commission containing his findings and recommendations for Commission action within 120 days, unless an extension is approved.

The FMC says that there are significant potential consequences for Canadian-flagged vessels calling at U.S. ports if the Commission determines there has been a violation of the Foreign Shipping Practices provisions. Options for offsetting sanctions include limiting Canadian-flagged vessels from calling at U.S. ports and assessing significant fees on Canadian-flagged vessels.

The Lakes Carriers Association applauded the FMC decision.

“The Canadian regulation, which American shipping industry leaders believe to be without precedent anywhere in the world, would require treatment equipment on American vessels loading ballast water in Canadian Great Lakes waters even when that water would be discharged in U.S. Great Lakes waters.” said the LCA. “In effect, the Canadian law would override U.S. law, U.S. Environmental Protection Agency (EPA) regulations, and U.S. Coast Guard regulations for ballast water discharges in U.S. waters. The Canadian regulation would stop U.S. vessels from carrying U.S. exports to Canadian Great Lakes ports so that Canadian vessels would carry all of that cargo. The Canadian government provided a process for Canadian vessels calling on Canadian Great Lakes ports to obtain relief from the treatment requirement but did not provide U.S.-flag vessels serving Canadian Great Lakes ports a relief process to apply the Canadian regulations to U.S. lakers so as to avoid the unlawful burdens the regulations would otherwise impose.

“U.S.-flagged fleet of ships and sailors on the Great Lakes are grateful to the FMC Commissioners for taking a stand for U.S. workers,” said Jim Weakley, president of the Lake Carriers’ Association, representing U.S. Great Lakes shipping companies. “The proposed regulation is severely biased and shamefully uses a serious issue to impose a trade barrier and increase profits for Canadian companies at the expense of everyday Americans. This is not about protecting the environment; this is about economic manipulation.”

The Great Lakes Maritime Task Force, which represents nearly 80 U.S. entities across the Great Lakes and includes shipboard and shoreside labor, ports, facilities, and shipyards also praised the FMC action.

“If Transport Canada is allowed to regulate U.S. waters on the Great Lakes in favor of Canadian vessels, a precedent will be set that will forever damage the ability of U.S. workers to compete and will further erode the maritime industry in America,” stated Richard Hammer, General Manager of DonJon Shipbuilding in Erie, Pennsylvania and President of the Great Lakes Maritime Task Force.

Great Lakes seagoing labor unions, including the Seafarers International Union, the Masters, Mates and Pilots, the Marine Engineers; Beneficial Association, and the American Maritime Officers, said, “The Canadian government should not be allowed to regulate American workers at U.S. facilities and ships on the U.S. side of the Great Lakes. The Canadian intent here is clear, monopolize Great Lakes shipping between the U.S. and Canada and eliminate U.S. jobs through unfair trade practices.”

• Read the Federal Register Notice on the FMC investigation HERE