The owners of coal ports ask not to toughen the punishment for environmental violations

The Association of Sea Trade Ports (ASOP) strongly criticized the draft law of the Ministry of Transport, which allows the state to terminate the lease agreement with stevedores (berths at terminals, hydrotechnical structures and other port infrastructure are state-owned) due to environmental violations during handling, crushing and sorting of coal.

At the end of July 2022, ASOP sent the relevant letters to the working group on the implementation of the “regulatory guillotine” mechanism, to the Ministry of Transport, the Ministry of Energy, the RSPP, the consumer council on the activities of FSUE “Rosmorport” (“Vedomosti” got acquainted with the appeals).

The draft law provides for the possibility of termination of lease contracts of federal property in case of non-compliance by tenants with the instructions of control and supervisory bodies and court decisions on violations of sanitary-epidemiological and environmental legislation. Its adoption, according to ASOP members, “will create a situation of excessive regulation of the stevedore business and discrimination by type of activity” and may lead “to critical consequences” for the industry.

The letters state that in the event of termination of the lease agreement, stevedoring companies will not be able to continue transshipment in the same volume, which will lead to the bankruptcy of the enterprises and the reduction of jobs. The new lessee of the port hydrotechnical facility will not actually be able to engage in transshipment due to the fact that part of the port facilities (for example, the actual cargo terminals) is owned by the person with whom the lease agreement was terminated.

“Loading and unloading activities at the specified object will be stopped, which will lead to a significant decrease in the cargo turnover of the ports <...> and inefficient use of state property”, – according to ASOP.

The Ministry of Transport prepared this draft law in September 2020, and in November 2021, the representative of the supervising branch of the Deputy Prime Minister Victoria Abramchenko told “Vedomosti” that the document was sent for revision. A source close to ASOP claims that now “movement has started again” on the draft law.

Members of ASOP previously said that the proposed changes create discriminatory conditions for owners of coal terminals compared to stevedores handling other cargoes. According to the interlocutor of “Vedomosti” in a large stevedoring company, the legislation does not provide for specific environmental requirements in relation to coal products.

The draft law prepared by the Ministry of Transport is logically connected with the second draft federal law from the Ministry of Natural Resources, which tightens the environmental responsibility of coal stevedores (in June 2022, this draft has already passed the first reading in the State Duma). According to the document, the stevedore will have to pay 100,000–200,000 rubles for non-compliance with the instructions of the supervisory authorities for the first time, and for repeated violations the fine will increase to 300,000–600,000 rubles. In addition, in this case, the activity of the violator may be suspended for a period of up to 90 days.

In July, ASOP also sent letters to First Deputy Prime Minister Andrey Belousov, State Duma Chairman Vyacheslav Volodin, the Ministry of Energy and the RSPP, with a request to prepare amendments to the draft law of the Ministry of Natural Resources. In particular. stevedores proposed to exclude liability for repeated offenses within a year and postpone the law’s entry into force for two years, until September 1, 2025.

The volume of coal transshipment in Russian ports, according to data from ASOP, in the first half of 2022 decreased by 4% to 97.3 million tons compared to the same period in 2021.

“Vedomosti” sent requests to the Ministry of Transport, Ministry of Energy, RSPP and members of the consumer council at “Rosmorport”.

According to the managing director of the rating service of the NRA, Sergey Grishunin, the draft law of the Ministry of Transport would be relevant if the export of coal, as in previous years, grew rapidly, and its shipment was carried out from sites “not fully prepared for this type of activity.” This, according to the expert, led to excessive dusting and coal dust falling on residential buildings.

“In recent years, large ports have significantly strengthened the environmental safety of port facilities, dust-suppressing screens have been built, and water curtains have been installed. There are still cases of dirty unloading of coal, but usually it happens in small, former fishing ports,” he said. Now, according to Grishunin, it is dangerous to grant the right to terminate lease agreements for all ports without exception, since the law does not clearly state what kind of violations can result in such punishment.

General Director of “Infoline-analytics” Mikhail Burmistrov believes that the current version of the document carries very high risks of negative influence on the investment climate and the stability of the stevedoring business. “In the conditions of transformation of logistics and reorientation of export flows, when a number of terminals (especially in the East and South of Russia) are operating at capacity limits, the adoption of regulatory documents that can negatively affect investments in the development of terminal infrastructure looks not only impractical, but also dangerous from the point of view of economic stability,” the expert explained.

Artem Kopylov, senior lawyer of KA Pen & Paper, points out that extending the bill only to coal terminals is a clear violation of legal technique and “a sign of discrimination by type of activity.”

In 2020, the Ministry of Transport issued an order clarifying the meaning of the term “closed coal transshipment”, which is considered to be transshipment using the best available technologies (BAT) included in the directory. But this document stipulated only BAT requirements, which stevedores are already obliged to follow (presence of protective screens up to 25 m high, dust suppression systems, etc.).

“According to the practice of court disputes, such ambiguity can be used to the detriment of conscientious stevedores, which in the current economic situation can cause irreparable damage to both the port and coal industries,” Grishunin believes.

This, in his opinion, may lead to the disruption of long-term coal supply contracts. Losses of stevedores, according to his estimation, can make up to 10% of annual turnover, or about $500-600 million.

Kopylov adds that the text of the draft law requires “improvement of its legal technique” as well as the elimination of duplicate, redundant provisions. Nevertheless, according to the lawyer, even if the proposed wording is preserved, the law is unlikely to cause “colossal negative consequences”. He points out that the text actually fixes the mechanism of the “double judicial filter” for terminating the lease agreement with the stevedore: “At the first stage, we must fix the fact of violation of environmental legislation. On the second, the court will consider the request of the lessor to terminate the lease agreement, taking into account all the circumstances of the case.”

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