2019 will bring challenges both in the marketplace and in new and continuing regulatory initiatives. Uneven economic growth and uncertainty over trade policy make the outlook for containerized cargo difficult to predict. What we do know is that the industry will continue to address major regulatory developments.
The European Commission has begun its five-year review of the EU consortia block exemption regulation (CBER). The CBER provides the legal certainty that makes the most common form of operational cooperation, the vessel-sharing arrangement (VSA), more efficient and easier to use. That regulation provides legal certainty in the EU and provides an example that other countries have looked to in creating their own rules for vessel sharing. The regulation is clear and easy to apply, and it provides a tool that allows carriers to burn less fuel, which lowers customer costs and reduces vessel air emissions, including greenhouse gases.
We also look for international regulatory consistency as the global 0.5 percent marine fuel sulfur cap becomes effective Jan. 1, 2020. The industry and IMO member states were successful in securing IMO agreement to ban carried as bunkers that exceeds 0.5 percent sulfur content (excepting ships using scrubbers, LNG, or carrying high-sulfur fuel oil as cargo). This is an important step in ensuring consistent global enforcement and a level regulatory playing field.
On greenhouse gases (GHGs), we will need new fuels and new propulsion systems to meet the ambitious GHG reductions that the IMO has already adopted. The shipping industry will continue to advocate for a sustained research and development program organized through the International Maritime Organization to help us make the technological advances required to sharply reduce GHG emissions from international shipping, which is already the most efficient form of transportation.