United States: EPA Proposes Draft Technical Guidance For Determining Quantities Of PCBS In Vessels Subject To Marad’s Foreign Transfer Requirements

Maritime Developments Advisory

New Development

The Environmental Protection Agency ("EPA") is seeking comments on draft guidance intended to assist shipowners in assessing the levels of polychlorinated biphenyls ("PCBs") present on their U.S.-flag vessels when seeking the Maritime Administration's ("MARAD") approval for the reflagging of those vessels for continued use or their sale for scrapping abroad.  The 99-page document is entitled "Draft Technical Guidance for Determining the Presence of Polychlorinated Biphenyls (PCBs) at Regulated Concentrations on Vessels (Ships) to be Reflagged" and contains recommendations on techniques and methodologies for shipowners to measure and estimate the levels of PCBs on vessels.  EPA's request for comments and the draft guidance document can be found at the following link: www.epa.gov/waste/hazard/tsd/pcbs/pcb_shp_guidnce.htm.  Comments are due by March 1, 2013.


In general, the transfer of a U.S.-flag vessel to another registry and/or to a non-U.S. citizen owner requires the prior approval of MARAD under 46 U.S.C. § 56101 (which is the current codification of Section 9 of the Shipping Act, 1916, as amended). Subject to certain exceptions, Section 56101 prohibits the sale, lease, charter, delivery, or other transfer (and any agreement to do so) to a non-U.S. citizen of any interest in or control of a U.S.-flag vessel owned by a U.S. citizen and the transfer of a U.S.-flag vessel to a foreign flag. In addition, the prohibitions of Section 56101 apply to vessels whose last documentation was the U.S. flag.

To implement the requirements of Section 56101, MARAD adopted regulations (46 C.F.R. Part 221) that grant general approvals for certain transfers of certain U.S.-flag vessels and interests in such vessels to non-U.S. citizens and set forth procedures for the approval of transfers not covered by the general approvals. In general, transfers of vessels over 1,000 gross tons require prior MARAD approval under these regulations.

In recent years, MARAD has agreed, on an informal basis, to refer foreign transfers of U.S.-flag vessels requiring its approval (whether for continued use or scrapping) to the EPA for EPA's review of compliance with U.S. environmental laws, in particular the Toxic Substances Control Act ("TSCA"), which is codified at 15 U.S.C. §§ 2601-2629.  (For a discussion of the emergence of EPA's involvement in MARAD's foreign transfer process, please refer to our article in the July 2010 edition of Mainbrace.) 

TSCA prohibited the manufacture, processing, or distribution in commerce of PCBs one year after the law's enactment in 1977.  Under EPA's regulations, the distribution in commerce, including for export, of PCBs at concentrations of 50 ppm or greater is prohibited, unless a waiver is granted. 40 C.F.R. §§ 761.20 and 761.97.  A vessel sold overseas, either for scrapping or continued use, has been deemed by the EPA in principle to be an export subject to TSCA.  Vessels manufactured before 1977 did contain PCBs in transformers, capacitors, and cables, among other places.  Although vessels built in the United States after 1978 presumably did not include PCBs, EPA and MARAD have not agreed on a year in which PCBs were deemed to be no longer used in ship construction for purposes of TSCA compliance.  

In connection with its administration of the foreign transfer regulations for U.S.-flag vessels, MARAD has selected 1985 as the year after which PCBs were presumably not used in the construction of vessels in the United States.  In June 2011, MARAD revised its approval process for the reflagging of U.S.-flag vessels over 1,000 gross tons by requiring shipowners to sign self-certifications that such vessels did not contain PCBs above regulated quantities and to provide notice to the EPA of the foreign transfer request for such vessels.  Under its revised approval process, MARAD gives the EPA up to 30 days notice of a transfer request before MARAD will approve it.  Vessels that were built in the United States after 1985 are exempt from MARAD's self-certification requirements. (For a discussion of the self-certification requirements for shipowners under MARAD's foreign transfer regulations, please refer to our Maritime Developments Advisory, No. 8, July 2011.)

EPA's Draft Technical Guidance

On February 1, 2013, the EPA published its "Draft Technical Guidance for Determining the Presence of Polychlorinated Biphenyls (PCBs) at Regulated Concentrations on Vessels (Ships) to be Reflagged" to assist shipowners in assessing whether regulated levels of PCBs exist on their U.S.-flag vessels as part of the self-certification process with MARAD for vessels to be reflagged or sold foreign for scrapping and to comply with TSCA's export requirements.  The draft guidance document was prepared by the EPA's Office of Resource Conservation and Recovery and its Office of Pollution Prevention and Toxics.  The draft technical guidance document states that presents suggestions and it is not "a regulation or policy document" and that it "does not impose any requirements or obligations on EPA or the regulated community."  Importantly, it states that completing an assessment of the presence of PCBs using the guidance does not "create a defense against a violation under TSCA" if one is found later.  

The draft guidance document discusses suggested approaches for making a statistically-based determination that any potential PCBs present on a vessel are at concentrations less than 50 ppm.  In that regard, it provides key decision points that would lead a shipowner toward one of three basic approaches:  (1) a strictly non-sampling approach (utilizing only historical records); (2) a targeted sampling approach; or (3) a non-targeted sampling approach.  The non-sampling approach relies on records related to the construction and maintenance of the vessel. The targeted sampling approach utilizes historical records to determine materials, areas, and/or parts of the vessel that do not contain PCBs and then uses sampling on the remaining materials, areas, and/or parts of the vessel.  The targeted sampling approach may also be applied to verify the conclusions or findings reached after a review of historical construction and maintenance records.  When there are no historical records to narrow the scope of the sampling, the non-targeted sampling approach may be applied, which utilizes only sampling to assess the presence of PCBs at regulated levels on the vessel.  The draft guidance document discusses which material categories on a vessel and the number of items within each material category that should be tested as part of the sampling.

EPA's Request for Comments

In addition to requesting comments on the draft technical guidance document in its entirety, the EPA specifically requests comments on the following:

1.The approaches taken in the draft technical guidance with respect to:

1.composite sampling,

2.logical groupings (using a subgroup approach to lessen the number of samples),

3.cable sampling, and

4.determining category population size for non-discrete items.

2.The potential applicability of the technical guidance to ship activities other than taking samples for reflagging or scrapping.

3.The cutoff date for when materials on a vessel can be assumed to not contain PCBs based on the vessel's year of initial construction in the United States because of the PCB ban.  In this regard, it is noteworthy that the EPA has not presumptively agreed with MARAD's cutoff date of 1985 as the year after which a vessel built in the United States will be deemed to not contain any PCBs.

Conclusions and Recommendations

Although the draft guidance published by the EPA does not require shipowners to submit sampling plans and analytical data to reflag or export a vessel, the EPA or MARAD may at some point in the near future require shipowners to submit such sampling plans and data as a means to support the self-certification that is currently required by MARAD.  In such an event, the EPA or MARAD would likely use the guidance document as a basis for establishing such requirements.  Hence, it is quite possible that the two agencies will continue to create new reporting and documentation burdens on shipowners with respect to the presence of PCBs on vessels to be reflagged or sold abroad for scrap.  Such reporting and sampling requirements would have serious cost and time implications for shipowners who are considering reflagging their U.S.-flag vessels or selling them for scrapping abroad.

All shipowners, especially those with older vessels, should review and consider submitting comments on the draft guidance and EPA's approach by March 1, 2013. Comments may be e-mailed to the EPA at ORCRPCBShipGuidance@epa.gov.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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Joan M. Bondareff
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