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Policy Research Corporation
Consequences of the
Gross Tonnage Measurement
A discussion document
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© Policy Research Corporation
Copyright 2005
Office Belgium: Office The Netherlands:
Jan Moorkensstraat 68 Parklaan 40
2600 Antwerp 3016 BC Rotterdam
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Table of contents
TABLE OF CONTENTS
I. BACKGROUND ........................................................................................................................... 1
II. THE TONNAGE MEASUREMENT CONVENTION: MAIN FEATURES ANDCONSEQUENCES........................................................................................................................5
III. IMPACT OF GROSS TONNAGE ON SHIP DESIGN...........................................................11
IV. COST CONSEQUENCES OF THE GROSS TONNAGE MEASUREMENT ..................... 15
IV.1. SHIPBUILDING COSTS ......................................................... ........................................................... ..... 15
IV.2. CREW COSTS .................................................. ........................................................... ......................... 16
IV.3. VOYAGE COSTS........................................................ ........................................................... ............... 16 IV.3.1. Port, canal and light dues..... ........................................................... ................................... 16 IV.3.2. Insurance costs ................................................... ........................................................... ..... 18
IV.4. OPERATIONAL COSTS......................................................... ........................................................... ..... 18
V. ALTERNATIVES SOLUTIONS TO THE USE OF GROSS TONNAGEMEASUREMENT.......................................................................................................................19
VI. CONCLUSIONS AND RECOMMENDATIONS ....................................................................23
ANNEX 1: PRESENTATION HELD AT THE 48TH
IMO SLF MEETING
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LIST OF FIGURES AND TABLES
Figure I.1 : Line of reasoning........................................................................................................... 2
Figure V.1 : Alternatives for remedying the present situation ........................................................20
Table II.1 : Selected rules and regulations with GT thresholds .......................................................6
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I.
BACKGROUND
With the adoption of the ‘International Convention on Tonnage
Measurement of Ships, 1969 (TM Convention), the Contracting
Governments aimed to establish a truly international and uniform
measurement system of ships, that would do away with the bad
influence of tonnage measurement from ship design and would lead
to safer ship.
Since the coming into force in 1982 of the TM Convention, however,
serious questions have been raised with respect to its negative
influence on the safety of certain types of ships. In particular the issue
of the suitability of Gross Tonnage (GT), as defined in the TM
Convention, for measuring open top container vessels, small and
feeder vessels, bulk carriers and fishing vessels, has in recent years
resulted in various initiatives and proposals submitted by member
states of IMO to the ‘Sub-Committee on Stability and Load Lines and
of Fishing Vessels Safety’ concerning the long-term effect of tonnagemeasurement with regard to safety.
Open top containerships, because they provide adequate
freeboard, pitch angle and bow height, offer greater
The 1969 International Conven-tion on Tonnage Measurementof Ships, aimed to establish a
truly international and uniformmeasurement system of ships,that would do away with the badinfluence of tonnage measure-ment from ship design andwould lead to safer ship.
However, serious questions havebeen raised on the issue of the
suitability of Gross Tonnage(GT), as defined in the Tonnage Measurement Convention withrespect to its negative influenceon the safety of certain types ofships.
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worldwide rather than on restricted coastal services, has
also lead to calls for the re-assessment of the safety of
small ships.
The reduced freeboard for bulk carriers, resulting in a
significantly lower GT compared to vessels with the
same dwt and the simultaneous elimination of the
requirement of a forecastle, without any additional
requirement for hatch cover strengths, although
economically satisfactory for the ship owners, has been
identified as one of the main causes for the loss of an
inordinate number of bulk carriers in the last 30 years1.
Figure I.1. graphically presents the main line of reasoning of the
foregoing discussion.
Figure I.1 : Line of reasoning
Impact on capital, running
and voyage costs
Impact on capital, running
and voyage costs
International Convention
on Tonnage Measurementof ships, 1969
Rules and regulations(SOLAS, STCW, ILO, MARPOL)
Dues and tariffs(Port, canal, insurance, …)
GT as
standardmeasurement
Liability
conventions
Impact on
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A further examination of the reported and or investigated deficiencies
of the GT measurement reveals two different but superimposed
problems. The critics of the 1969 TM Convention point first and
foremost at the fact that the vessel measurement system exerts
pressure on the safety margins of the ship. Rather than to reward the
prudent naval architect, shipbuilder and ship owner, GT penalizes
them. As the GT measurement is the basis of several rates and tariffs
and represents thresholds or limitations for determining minimum
requirements for various mandatory or customary prerequisites or
provisions, an increased GT without a comparable increase in earning
capacity only leads to higher costs for the vessel’s operator. Moreover
the application of GT for setting port dues or other tariffs inevitably
leads to arbitrary tariff setting and discrimination between shipsdepending on types and sizes. The second problem, which has
attracted less attention up to now, concerns the lack of a rational link
between the various GT thresholds and the expected results from the
limitations that are being imposed.
This discussion document hasbeen prepared on request of the Directorate General for Civil Aviation and Freight Transportof the Dutch Ministry ofTransport, Public Works andWater Management and aims to provide a substantiated answerwith respect the adequacy of theGT measurement in today’sshipping environment.
This discussion document, which has been prepared on request of the
Directorate General for Civil Aviation and Freight Transport of theDutch Ministry of Transport, Public Works and Water Management,
aims to provide a substantiated answer with respect the adequacy of
the GT measurement in today’s shipping environment and review the
main problem areas that have been defined in connection with the GT
rules. Ultimately, it will present a number of possible alternative
solutions that have been proposed by various industry experts in order
to amend the noted defects and failings.
The first part of the discussion document will consider the main
features of the TM Convention and then present a comprehensive
review of the various international conventions and regulations that
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II. THE TONNAGE MEASUREMENT CONVENTION:
MAIN FEATURES AND CONSEQUENCES
The Tonnage Measurement Convention of 1969 establishes
regulations for determining the Gross and Net Tonnages of ships and
provides for the issuance of an International Tonnage Certificate to
every ship by the Government of the State whose flag the ship is
flying. Included in the Gross and Net Tonnages are all the enclosed
spaces which are bounded by the ship’s hull, by fixed or portable
partitions or bulkheads, by decks or coverings other than permanent
or movable awnings
2
. The Convention stipulates that all enclosedspaces are included in the GT, and in order to further explain and
clarify what is considered as being an enclosed space, lists in detail, a
number of excluded spaces. But, the Convention doesn’t distinguish
between the enclosed spaces that are provided to carry paying cargoes
and those that serve to improve the seaworthiness of the ship. As a
result, vessels incorporating good design features to enhance its safety
will have a higher GT because the additional enclosed spaces, that are provided to ensure such safety, are fully included in the final tonnage
measurement result.
In several international conventions the application of their
The Tonnage Measurement
Convention of 1969 establishesregulations for determining theGross and Net Tonnages ofships and provides for theissuance of an InternationalTonnage Certificate to everyship by the Government of theState whose flag the ship is flying.
Included in the Gross and Net
Tonnages are all the enclosedspaces which are bounded bythe ship’s hull.
International conventions suchf l SOLAS STCW
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Table II.1 : Selected rules and regulations with GT thresholds
Regulation Area of impact Subject GT Thresholds
SOLAS chapter IV Equipment Radiocommunications 300 GT
SOLAS chapter V Equipment and administrative Automatic ship identification system 300 GT, 500 GT, 3 000 GT
10 000 GT, 50 000 GT
Daily reporting 500 GT
(Simplified) voyage data recorders 3 000 GT, 20 000 GT
SOLAS chapter IX Administrative ISM Code 500 GTSOLAS chapter XI-1 Administrative Identification number 300 GT
SOLAS chapter XI-2 Equipment and administrative ISPS Code 500 GT
SOLAS chapter XII Equipment (Simplified) voyage data recorders 3 000 GT, 20 000 GT
MARPOL Equipment and administrative Threshold for certification 400 GT
STCW Convention Manning Madatory level of requirements for
certification of masters and ship mates
500 GT
3 000 GT
ILO C178: art. 1 Administrative Labour Inspection Seafarers Convention 500 GTILO C164: art. 11 and 9 Manning Health protection and Medical Care Seafarers
Convention
500 GT (and 15 seafarers)
1 600 GT
ILO C133: art. 5 Accommodation Minimum floor area 1 000 - 3 000 GT
3 000 - 10 000 GT
3 000 GT
10 000 GT
ILO C133: art. 7 Accommodation Recreation area 8 000 GT
ILO C133: art. 8 Accommodation Bathroom facilities 5 000 GT
5 000 - 15 000 GT
15 000 - 25 000 GT
25 000 GT
ILO C133: art. 9 Accommodation Water closet and facilities for changing clothes 1 600 GT
Convention on Limitation of Liability
for Maritime Claims 1976
Liability Limitation in respect of loss of life or personal
injury property claims
< 500 GT
501 - 3 000 GT
3 001 - 30 000 GT
30 001 - 70 000 GT
70 001 GT
* International Convention on
Liability and Compensation for
Damage in Connection with the
Carriage of Hazardous and Noxious
Substances by Sea 1996
Liability Compensation for accidents involving
hazardous and noxious substances; make it
possible for up to 250 million SDR to be paid
out to victims of disasters involving HNS
< 2 000 GT
2 000 - 50 000 GT
50 000 GT
* Not yet into force
Source : Policy Research Corporation
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Conventions deals with accommodation of crews, health protection
and medical care. The thresholds for additional requirements
regarding the accommodation of crews are respectively 1 600, 5 000,
8 000, 10 000, 15 000 and 25 000 Gross Tonnes. But for health
protection and medical care the imposed thresholds are 500 Gross
Tonnes for ships carrying more than 15 seafarers and engaged in a
voyage of more than three days and 1 600 Gross Tonnes. Manning
requirements in terms of size of the crew and individual qualifications
are subject to national regulations of the Flag State of the vessel. In
most cases the minimum crew levels and qualifications of officers
and ratings are decided on the GT of the ship.
Other, recommended but non-mandatory thresholds, that may have a
decisive impact on the ship owner’s decisions, are often based on GT.
They concern, for example, the calculation of premiums for
Protection and Indemnity insurance and the various levels of liability.
Although the P&I premium is expressed per Gross Ton, the decisive
factors determining the premium level are the claims record, the
profile and history of the fleet or ships to be insured (type of vessel,
age, number of ships, type of engines, classification society), the riskscovered and the perceived exposure and deductibles. Although P&I
Clubs offer unlimited cover, they impose limitations of liability which
are based on the GT of the ship.
Where all of the Conventions referred to above base their regulations
on GT, the MARPOL 73/78 Convention (International Convention
for the Prevention of Pollution from Ships, 1973, as modified by the
Protocol of 1978 relating thereto) generally imposes requirements
(e.g. for segregated ballast tanks, double hulls, construction
requirements) on the vessel’s deadweight. The MARPOL certification
system has as a general threshold 400 GT In several Annexes and
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The Oil Pollution Act of 1990 enacted by the Congress of the United
States sets thresholds for the total liability of a responsible party on
the basis of GT (including for the removal costs, damages and
liability of third parties). The thresholds are 3 000 GT for tankers and
a limitation either per Gross Ton or a defined amount whichever is
greater for other vessels.
The International Convention on Liability and Compensation for
Damage in Connection with the Carriage of Hazardous and Noxious
Substances by Sea (HNS 1996) provides for limits of liability based
on GT (ships not exceeding 2 000 Gross Tons can limit their liability
to SDR 3 10 million, whereas ships above that limit but not exceeding
50 000 Gross Tons can limit their liability to SDR 10 million plus
1 500 SDR for each additional Gross Ton. Ships in excess of 50 000
Gross Tons can limit their liability to the liability limit of the ships
between 2 000 and 50 000 Gross Tons, but with an extra of 360 SDR
for every additional Gross Ton. The total possible amount the ship
owner is liable for is anyway limited to 100 million SDR.
In August 2003 the European Union introduced new regulations forfishing vessels regarding entry and exit and the limitation of the
fishing fleet’s total catching capacity (Directive 1438/2003). These
regulations use the GT in combination with engine power as a
threshold measure to determine reference levels of the fishing fleet.
Lack of causal link
In several instances thereference to the GT measure israther irrational because of thelack of causal link between thespecific aim that is pursued insetting the threshold and the GTmeasure itself.
Apart from the argument whether GT has implications on the safety
and the stability of a vessel, it is obvious that in several instances the
reference to the GT measure is rather irrational because of the lack of
causal link between the specific aim that is pursued in setting the
threshold and the GT measure itself:
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III. IMPACT OF GROSS TONNAGE ON SHIP DESIGN
It is stated that the GT measurement system, through its application in
international rules and regulations or because it is used as a yardstick
for levying duties, has an effect on ship design. In this Chapter, theadverse effects of the current GT measurement regime will be
illustrated for specific ship types.
The GT measurement system,through its application ininternational rules and regula-
tions or because it is used as a yardstick for levying duties, hasan effect on ship design.
a/ Container vessels
Several groups of container carrying ships can be distinguished, for
which the GT measurement presents specific challenges:
− Small containerships (of around 3 000 GT or below): for theseships the load line convention rules and the ship stability
prescriptions allow for designs with minimal freeboard and reserve buoyancy resulting in limited tolerance levels in case of humanerror (mistakes in navigation or cargo handling) or exceptionalweather conditions. The application of the GT measurementinduces naval architects and shipbuilders to build ships with ‘odd’
shapes (relatively short and narrow ships with no forecastle butwith cut-off stern, small engine room and tight crew accom-modation spaces);
− Medium and large cellular container ships (over 6 000/ 8 000TEU): freeboard on larger container ships is less of a problem, but
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A solution for the safety and lashing problems could be thedeployment of open top (hatch coverless) ships, with very highfreeboard. But their higher GT has worked as a disincentive andshipping lines seem now reluctant to order them. The GTmeasurement not only increases the basis on which these vesselsoften are billed, but a deficiency in the formula itself, foresees thatopen top container ships can’t be larger than 30 000 GT. A
question that is raised by ship designers is whether the IMOguidelines for open-top ships are not excessive.
An additional benefit for the ship owner of operating an open shipis the lesser risk that parametric rolling or heavy weatherconditions would result in a number of containers being thrownoverboard or severely damaged on deck. Jettison of containers onsuch ships is, however, not an option. With the size of containerships exceeding the 10 000 TEU barrier, the design limits of the
traditional container vessel have been stretched to the maximum.Open-top container ships may offer a solution to overcome thesedesign limitations and ensure safer vessel operation and containerhandling.
b/ Bulk carriers
These are typically wide vessels with reduced freeboard, no forecastle
and non-re-enforced hatch covers on the forward holds. They are
prone to general and localised stresses of the structure and hatches
and to collapsing bulkheads.
The loss record of bulk carriers in the 70’s and 80’s confirmed that
these vessels were accident-prone. Hence, the recommendation made
in 1991 by the IMO for adopting hull stress monitoring systems and by the Classification Societies for a revision of the rules for structural
and survey requirements. Since 01/01/2005 as per regulation 39 of the
Load Lines Convention (ICLL), a forecastle has become compulsory
on bulk carriers.
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d/ RoRo and Car carriers
They typify vessels with a high freeboard needed for the safety of the
ship and the cargo but resulting in high GTs. A number of Port
Authorities have acknowledged this fact and have adapted their port
dues accordingly.
e/ Livestock carriers
Freeboard of these vessels may not be higher but they are penalised
by the GT measure because the extensive above deck livestock
houses, providing better protection of the cargo, are included in the
total enclosed volume. As on traditional container ships the deck
capacity is exempt from tonnage measurement this is a good example
of discrimination resulting from GT measurement.
f/ Passenger vessels
For these, space critical vessels, the GT is the appropriate measure
because it is without detriment to the safety of the ship and it
approximates well their earning potential.
g/ Fishing vessels
GT thresholds set the minimum values for safety levels on basis of
worldwide mean conditions. For the fishing sector (specifically ocean
going trawlers), operating in harsh environments, such minimum
safety standards are insufficient. Specifically for new buildings and
conversions, GT thresholds become a factor that lead to a reduction in
crew accommodation spaces and covered working areas. Providing an
increased forecastle height to improve safety adds to the GT but not
to the catching capacity. New designs for trawlers may incorporate a
new type of RSW tank with cylindrical shape an improved fish
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IV. COST CONSEQUENCES OF THE GROSS TONNAGE
MEASUREMENT
IV.1. SHIPBUILDING COSTS
Ship owners demand from their naval architects and shipbuilders that
they provide ships that will allow them to maximize earnings and
minimize costs. This only proves they have good commercial sense.
To achieve this challenge, the designer of the ship must at the same
me strive to optimize the cargo space on board (i.e. the ship’searning capacity) and reduce steel usage to a minimum. This might
result in vessels with minimal freeboard offering a GT that just
marginally remains below the various threshold values that
International Conventions impose. Hence, ships may be built against
set limits (explaining, for example, the number of ships around 499
and 2 999 GT in the fleet).
ti
In essence, Ship are designed tomaximize earnings and minimizecosts. This might, however,result in vessels with minimal freeboard offering a GT that justmarginally remains below thevarious threshold values that
International Conventionsimpose.
Especially designs for smaller vessels offer very reduced or no safety
margins. The safety norms that are being used satisfy the ‘average’
ship but leave little or no reserve to compensate for human error,
incorrect stowage or exceptional weather conditions. Under pressure
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territories and the Polish ports which use as their tariff base the
volume of the vessel as defined by length, breadth and summer draft5.
Canal dues are traditionally set on the GT but in 2005 the Panama
Canal Authority changed its charging unit for containerships from GT
to the vessel’s TEU capacity. Where light dues are separately
charged, the basis is normally GT.
Thus, if the GT of a vessel because of an improved safety design
increases, say by 10%, the result for the ship owner will be an
additional 10% increase in his port, canal and light dues. The
significance of port dues in the total port disbursement note of a ship
owner varies greatly from port to port call. Also, their coverage is far
from uniform and overall Port Authorities related dues may oscillate
wildly (between for example € 1 000 and € 30 000 per call of a
10 000 DWT/ 7 000 GT general cargo ship). As a general rule it can
be taken that port dues are significant costs for a ship operator,
especially because of the number of repeated port calls in a year. For
a 10 000 GT container vessel the annual port costs amount to approx.
€ 650 000 and between € 1 and € 1.5 million for a 40 000 GT
container vessel.
When considering the impact of a GT on the amounts ship operators
have to disburse to ports, one should not overlook two important
facts:
− Firstly, most ports offer considerable rebates on the base level oftheir port dues (depending on type and size of vessel, type of trade,
number of calls per year, etc.);
− Secondly, published tariffs are rarely applied as indicated in thetariff book and many shipping lines carry enough clout tonegotiate with the Port Authority a more advantageousarrangement.
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IV.3.2. I NSURANCE COSTS
Two major components make up the insurance costs for a vessel: the
hull and machinery insurance costs and the P&I and related ship
costs. Hull and machinery insurance premiums are almost always set
on the basis of the declared value of the vessel and rarely or never on
GT. But as already pointed out, many other factors play indetermining the premium levels, such as the reputation and
experience of the owner or manager, the claims record (a lot of
emphasis is placed by underwriters when calculating their rates), the
size of the fleet to be insured, the trade and the vessel (type, value,
flag, classification society, IMO compliances, crew and the split of
the RDC (collision cover) between Hull and Machinery and P&I
insurance. Annual totals for Hull and Machinery typically vary
depending on the mix of parameters mentioned, between US$ 50 000
and US$ 200 000 (passenger vessels not included).
The P&I underwriters are adamant that they do not rate fleets or
vessels on a tariff basis. A huge variation in premium is to be
expected as they are essentially set as a result of the perception of theunderwriter, the claims record and the bargaining power of the
insured. The underwriting factors for P&I are basically the same as
for the Hull and Machinery insurance except such items as hull value,
increased values and disbursements6 which are not relevant to P&I.
As an indicative example, the annual P&I contribution for say a
25 000 GT ship is between € 45 000 and € 70 000, although for
certain ships much higher or much lower contributions will apply.
Hull and machinery insurance premiums are almost always seton the basis of the declaredvalue of the vessel and rarely ornever on GT.
The annual P&I premium,
however, is based on the GT ofthe vessels.
IV.4. OPERATIONAL COSTS
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V. ALTERNATIVE SOLUTIONS TO THE USE OF
GROSS TONNAGE MEASUREMENT
The preceding overview reveals or confirms the irrelevance of GT for
determining the size of a vessel or for establishing thresholds for theapplication of rules and regulations. The GT measurement doesn’t
succeed in realizing the objectives that were the basis for setting
thresholds. It obviously leads to less safe ships whilst hampering the
application of constructive new ideas and design innovation. It is
therefore urgent to consider alternatives for remedying the present
situation. An overview is presented in Figure V.1.
A first step, which wouldn’t need amendments of the 1969 Tonnage
Measurement Convention, would be for the maritime transport
stakeholders (Governments, international maritime authorities, ship
owners, ship designers, shipbuilders, classification societies, port
authorities, maritime lawyers) to investigate the genuine link between
the thresholds stated in the various Convention rules and tariffs in GTand the aims and objectives of these conventions and tariffs.
For example the minimum requirements regarding life boats should
be decided on the basis of the maximum number of persons on board,
Chapter V gives a number ofalternatives for remedying the present situation with respect tothe negative impact of the use ofthe GT measurement.
STEP 1: investigate the genuinelink between the thresholdsstated in the various Conventionrules and tariffs in GT and theaims and objectives of theseconventions and tariffs.
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Figure V.1 : Alternatives for remedying the present situation
Investigate the
genuine link
between the
thresholds stated
in the various
Convention rules
and tariffs in GT
and the aims and
objectives of
these conven-
tions and tariffs
Support, as
a transitory
measure,
proposals to
introduce a
reduced GT
formula for
open top
container ships
Take the reduced
GT forward as a
correction and
enter this in lieu
of the previously
calculated GT on
the first page of
the tonnage
certificate
Introduce for all
ships a new GT
measurement, in
which thecovered spaces
specifically
provided for
safety, would be
deducted from
the GT as
defined under
present rules
Modernise the 1969 Tonnage Measurement Convention, so that future adaptations of the
convention only need implicit and not explicit ratification by the member states
1 2 3 4
Source : Policy Research Corporation
The re-consideration of the logical link between GT and what the
thresholds aim to achieve would, to a not insignificant extent, reduce
the use of GT. It would therefore make the whole issue less charged
and this would substantially improve the chances that vessels,
offering a higher GT to be safer, become more attractive to owners
and operators from a costs and earnings point of view. Apart from theinevitability of getting the full co-operation of all stakeholders, this
step implies the acceptance of the shipping community to revise a
host of existing conventions and to reconsider traditional pricing
strategies, tariff structures and rate levels.
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−
a ‘register tonnage’ based on the length, the breadth and thesummer draught of the vessel;
− or to accept for these ships a reduced GT for the calculation ofGT-based fees based on the provisional formula:
Reduced GT = GT {1 – [(30 000 – GT) / (1 000)] x 0.07]}
−
or to offer a flat reduction rate of 10% of the GT;
In the transitional phase, before final adoption and inclusion in the
1969 Tonnage Measurement Convention, the reduced GT formula
shown above, should be subject to continuous review and adjustment,
as the coefficients used may have to be improved and refined.
STEP 3: take the reduction inGT forward and enter this inlieu of the previously calculatedGT on the first page of thetonnage certificate.
As a next step, an amendment to the 1969 Tonnage Measurement
Convention has been proposed by Germany. It is to take the reduction
in GT forward as a correction for the number representing the
enclosed volumes of the ship hull and to enter this in lieu of the
previously calculated GT on the first page of the tonnage certificate.
The proposals specifically targeted to adjust or reduce the GT of
open-top container ships, find their origin in the fact that although
being safer ships, the GT measurement penalizes these ships and
discriminate against their owners or operators.
In this respect, the application of Regulation 1(3) of the TM
Convention could also be considered. This regulation concerns craftsof novel designs and states that ‘’the gross and the net tonnage of
novel types of craft whose constructional features are such to render
the application of the provision of these Regulations unreasonable or
impracticable shall be as determined by the Administration’. What
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GT would thus be calculated as follows: GT as determined under
present tonnage rules minus the covered spaces that are provided for
safety purposes within the present freeboard and those extra spaces
that result from providing a higher freeboard in a revised design. The
tonnage value thereby obtained would be used to calculate the various
fees and charges due to the vessel. For the crew accommodation a
similar calculation could be carried out to determine the extra coveredspace that would not be included in the GT for charging purposes. A
major disadvantage of following this step is that it may again lead to
creative thinking solely aimed at artificially reducing the GT. It would
mean a return to the pre-1969 Convention days.
An even more radical step than
the proposal to introduce a newGT measurement system, wouldbe to establish the size of thevessel on the ‘indisputable’ physical dimensions of the ves-sel, i.e. length overall, breadthoverall and summer draught andcalculate the fees on theobtained volume basis.
An even more radical step than the proposal to introduce a new GT
measurement system, would be to establish the size of the vessel on
the ‘indisputable’ physical dimensions of the vessel, i.e. length
overall, breadth overall and summer draught and calculate the fees on
the obtained volume basis. Some ports have introduced a charging
system based on length overall (e.g. the Port of New Orleans for
dockage). Changing the charging base doesn’t imply a loss of revenue
for Port Authorities, as they will be able to adjust the basis of thetariffs. Hence, port dues in French ports are generating much higher
revenues than in competing European ports although they have been
set on volume, calculated as the product of length, breath and draft.
A constructive idea to allow faster adaptation of amendments could
be to modernise the ratification process of the 1969 TM Convention
towards implicit rather than explicit ratification, in line with more
recent Conventions such as MARPOL and SOLAS.
Irrespective of a revision of the tonnage measurement system, it is
necessary to critically re examine and impartially scrutinize the
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VI. CONCLUSIONS AND RECOMMENDATIONS
The GT is a universal and uniform measure that was introduced to
determine unequivocally the size of a vessel and use it for charging
purposes. Since the adoption in 1969 of the Tonnage MeasurementConvention, there has been an escalation of rules in maritime
transport that set thresholds for enforcing minimum standards or
limiting liabilities. For most of these thresholds the GT offers no
rational basis and could and should therefore be discarded in favour
of thresholds that ensure a strong link between the threshold values
and the stated target or objective.
Based on experience and factual data, maritime industry experts
including naval architects, shipbuilders and classification societies
have come to the conclusion that the 1969 Tonnage Measurement
rules as presently applied, tied to the many, often unrealistic
thresholds imposed by a host of conventions, have as major
detrimental effect that although ships are being built, within all thestated rules, they are less safe than they could and should be. Because
virtually all safety margins have been used up and vessels have to
operate in circumstances that are considerably more taxing than the
average operating conditions on which most rules are based, the
Based on experience and factualdata, maritime industry expertsincluding naval architects, ship-builders and classification so-cieties have come to the conclu-sion that the 1969 Tonnage Measurement rules as presentlyapplied, has as major detri-mental effect that although shipsare being built, within all thestated rules, they are less safethan they could and should be.
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Discussion document on the impact of the GT criterion
container ships and container ships with a traditional design) and the
deterioration of working conditions on board ships.
The case to address the negative consequences of the GT
measurement system has been clearly made, as testified by the many
submissions made by the member states to the IMO’s ‘Sub-
Committee on Stability and Load Lines and on Fishing VesselsSafety’ and by the numerous studies by maritime research institutes
and ship designers. The problem now lies in finding workable
alternatives. These will inevitably have to take into account the type
of vessel and the purpose that is being pursued by the use of a vessel
measurement standard. Given the anticipated difficulty to change the
1969 Tonnage Measurement Convention and the time that will be
needed, it may be appropriate to first introduce interim measures to
correct problems and then to consider a more fundamental change to
the tonnage measurement rules.
If it is accepted that an adaptation of the GT measurement rules or a
new measurement regime is necessary, the result should be an
unambiguous, incontestable and consistent set of proposals. First, theuse of GT for establishing threshold values for many diverse causes
should be carefully examined on rationality and where appropriate,
alternative bases for the thresholds should be proposed. Secondly, the
main line of force of any proposal should be to undo the presently
inherent link between ship safety (as incorporated in the design and
construction specifications) and the GT. Finally there is a need to
reconsider the appropriateness of the present subdivision and damage
stability requirements (intact and damage) for dry ships and the link
to load line rules and ship measurement.
The problem now lies in findingworkable alternatives. Thesewill inevitably have to take intoaccount the type of vessel andthe purpose that is being
pursued by the use of a vesselmeasurement standard.
If it is accepted that an adap-tation of the GT measurementrules or a new measurementregime is necessary, the result
should be an unambiguous,incontestable and consistent setof proposals.
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Discussion document on the impact of the GT criterion
ANNEX 1: PRESENTATION HELD AT THE 48TH
IMO SLF MEETING
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Policy Research CorporationPolicy Research CorporationSOUNDSOUND SOLUTIONS BASED ON SCIENTIFIC RESEARCHSOLUTIONS BASED ON SCIENTIFIC RESEARCH
Consequences of the
Gross Tonnage (GT) measurement
Gustaaf De Monie, Senior Director
Sub-Committee on Stability and Load Lines
and of Fishing Vessels Safety
London, 13 September 2005
CONTENTS
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CONTENTS
1969 Tonnage Measurement Convention: main features and
consequences
Impact of the Gross Tonnage measurement system on ship design
Cost consequences of the Gross Tonnage measurement system
Alternative solutions to the use of Gross Tonnage
Conclusions and recommendations
THE 1969 INTERNATIONAL
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TONNAGE MEASUREMENT CONVENTION
The International Tonnage Measurement Convention of 1969
• establishes regulations for determining the Gross and Net Tonnages of ships
• provides for the issuance of an International Tonnage Certificate to every ship by
the Government of the State whose flag the ship is flying
Included in the Gross and Net Tonnages are
• all the enclosed spaces which are bounded by the ship’s hull, by fixed or portable
partitions or bulkheads, by decks or coverings other than permanent or movable
awnings
The Gross Tonnage of a ship is determined by• GT=K 1V
• where V is the total volume of all enclosed spaces of the ship in cubic meters and
K 1 = 0.2 + 0.02log10(V)
THE 1969 INTERNATIONAL
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TONNAGE MEASUREMENT CONVENTION
RESULT
Vessels incorporating good design features to enhance safety
will have a higher GT because the additional enclosed spaces,
that are provided to ensure such safety, are included
The 1969 International Tonnage Measurement Convention aimed to establish a truly
international and uniform measurement system of ships, that would do away with the
bad influence of tonnage measurement from ship design and would lead to safer ships
The Convention stipulates that allenclosed spaces are included and, inorder to further explain and clarify
what is considered as being an
enclosed space, lists in detail anumber of excluded spaces
The Convention doesn’t distinguish
between the enclosed spaces that are
provided to carry paying cargoes and
those that serve to improve the
seaworthiness of the ship
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RECORDED PEAKS AT THRESHOLDS IN GT
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(BY VESSEL TYPE)
Number of
vessels
(delivered)
number of
vessels
< 3000 GT
% of total GT
per vessels
type
Significant
peaks at
thresholds
GT correlation
with DWT
Container vessels 3 367 2.7% 0.2% no 98.6%
Dry cargo vessels 10 300 53.7% 18.8%
499 GT
2 999 GT 97.9%
Bulk carriers 6 190 4.3% 0.2%
499 GT
699 GT 99.4%
Tanker 9 126 34.2% 1.9%
499 GT
699 GT 98.8%
Roro vessels 1 801 16.7% 1.3% no 79.4%
Fishing vessels 2 637 98.3% 89.9% 499 GT 79.3%
Miscellaneous 4 477 76.9% 22.9% 499 GT 80.0%
Based on Lloyd’s Register Fairplay database
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IMPACT OF GROSS TONNAGE ON SHIP DESIGN
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IMPACT OF GROSS TONNAGE ON SHIP DESIGN
Vessel type Cause Consequences
Small general cargo
and container vessels
of 3 000 GT or below
Load line convention rules and the ship
stability prescriptions allow for designs with
minimal freeboard and reserve buoyancy
resulting in limited tolerance levels in case ofhuman error (mistakes in navigation or cargo
handling) or extreme weather conditions
Induces naval architects and
shipbuilders to build ships
without forecastle, but with
cut-off stern, small engineroom, tight crew
accommodation spaces, …
THE DONGEDIJK
CAPSIZED WHILE
MANOEUVRING
IMPACT OF GROSS TONNAGE ON SHIP DESIGN
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IMPACT OF GROSS TONNAGE ON SHIP DESIGN
Vessel type Cause Consequences
Medium and large
cellular container
ships
The number of containers carried above
deck becomes ever larger
Risk that heavy weather conditions and parametric rolling would result in large
numbers of containers being thrown
overboard or severely damaged,
including containers with dangerous or
noxious substances
Lashing of deck containers becomes
a costly, ineffective and for the
lashing gang, a perilous task
The design limits of the traditional
container vessel have been stretched
to the maximum and innovative
designs become imperative
IMPACT OF GROSS TONNAGE ON SHIP DESIGN
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T E U c a p a c i t y
Scatterdiagram TEU versus GTFor a sample of container ships around 3 600 TEU
GT
3 300
3 350
3 400
3 450
3 500
3 550
3 600
3 650
3 700
3 750
3 800
30 000 35 000 40 000 45 000 50 000 55 000 60 000
P&O Nedlloyd Oceania
P&O Nedlloyd Damman Frankfurt Express
MSC Kerry
Maersk Toyama
Conti Shanghai
A possible solution for the safety and lashing problems could be the deploymentof open top (hatch coverless) ships. Because of the imposed higher freeboard,
they are more expensive to build and their higher GT is a serious disincentive
11% more GT
than average
IMPACT OF GROSS TONNAGE ON SHIP DESIGN
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Vessel type Cause Consequences
Bulk carriers Wide vessels with reduced freeboard,
no forecastle and non-re-enforced hatch
covers on the forward holds
Prone to general and localised
stresses of the structure and the
hatches and collapsing bulkheads
Berge Artic, 175 000 dwt Remedial action:
1/ adoption of hull stress
monitoring system
2/ revision of the rules for structural
and survey requirements
3/ since 1/1/2005 forecastle required
as per ICLL regulation 39
= higher GT
COST CONSEQUENCES OF THE
GROSS TONNAGE MEASUREMENT
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GROSS TONNAGE MEASUREMENT
Cost item Issue Cost impact
Ship building
costs
1/ ships offering higher freeboard and, consequently,
higher GT, use more steel
2/ vessels exceeding GT thresholds requireadditional navigational and other equipment
3/ ships offering more spacious accommodation for
their crew have higher building costs because of
higher GT and additional fittings
Between 5 and 25 percent
extra, depending on the size
and type of the vessel
Crew costs If a vessel, because of its relative higher GT, falls
into a class of vessel for which more stringent
certification requirements exist, crew costs may
increase considerably (applies especially for vessels
exceeding the 3 000 GT threshold)
Crew cost could go up
anywhere from 10 to 20
percent or between
€ 50 000 and € 200 000 per
annum
Voyage costs The operational time of a vessel at berth is a main
cost element that can be influenced by GT if this
measure leads to less performing vessels (total
required lashing times of standard container vessels)
The cost effect, although
indirect in nature, can be
significant: e.g. a result of 10
to 15 percent extra berth time
COST CONSEQUENCES OF THE
GROSS TONNAGE MEASUREMENT
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GROSS TONNAGE MEASUREMENT
Cost item Issue Cost impact
Port, canal and
light dues
In most ports the general port dues
have been set on the basis of the GT
of the vessel. Exceptions are the
French ports, the ports in formerFrench territories and the Polish
ports which use the volume of the
vessel as defined by L x b x Te
Canal dues are traditionally set on
the GT but in 2005 the Panama
Canal Authority changed its charging
unit for containerships from GT to
the vessel’s TEU capacity
Where separately charged, the basis
for levying light dues is normally GT
A 10% larger GT will result for the ship
owner in a 10% increase in the port, canal and
light dues of the ship owner
The significance of port dues in the total port
disbursement note of a ship owner varies
greatly from port to port call. Also, their
coverage is far from uniform.
The total impact on cost can be significant
because of the total number of port calls a
vessel makes in a year. (Note the difference
between shortsea and deepsea trades)
For a 10 000 GT container vessel the annual
port costs amount to approx. € 650 000 and
between € 1 and € 1.5 million for a 40 000GT container vessel
COST CONSEQUENCES OF THE
GROSS TONNAGE MEASUREMENT
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GROSS TONNAGE MEASUREMENT
Cost item Issue Cost impact
Insurance costs Two major components make up the
insurance costs for a vessel:
• the hull and machinery insurance costs
• the P&I and related ship costs
Hull and machinery insurance premiums
are almost always set on the basis of the
declared value of the vessel and rarely or
never on GT
The annual P&I premium, however, is
based on the GT of the vessels
Huge variations in P&I contributions
exist as these are the result of the
perception of the underwriter, claims
record and bargaining power of theinsured.
As an indicative example, the annual
contribution for a 25 000 GT container
ship is between € 45 000 and € 70 000
CONCLUSION ON COST CONSEQUENCES:
Through its application in international rules and regulations, or because it
is used as a yardstick for levying duties, the cost impact of the GT
measurement system for ship owners or operators can be significant
ALTERNATIVES FOR REMEDYING THE PRESENT SITUATION
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Investigate the
genuine link
between thethresholds stated
in the various
Convention rules
and tariffs in GTand the aims and
objectives of
these conven-
tions and tariffs
Support, as
a transitorymeasure,
proposals to
introduce a
reduced GTformula for
open top
container ships
Take the reduced
GT forward as a
correction and
enter this in lieu
of the previously
calculated GT onthe first page of
the tonnage
certificate
Introduce for all
ships a new GT
measurement, inwhich the
covered spaces
specifically
provided for
safety, would be
deducted from
the GT as
defined under
present rules
Modernise the 1969 Tonnage Measurement Convention, so that future adaptations of the
convention only need implicit and not explicit ratification by the member states
1 2 3 4
CONSEQUENCES OF THE PROPOSED
ALTERNATIVES SOLUTIONS
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ALTERNATIVES SOLUTIONS
1 2 3 4
Requires full co-
operation of all stake-
holders and implies
the acceptance of the
shipping community
to revise a host of
existing conventions
The reduced GT
formula should be
subject to continuous
review, as the
coefficients used may
have to be improved
and refined
It may again lead to
creative thinking solely
aimed at artificially
reducing ship GT. It
would mean a return to
the pre-1969
Convention days
Publication of
Circulars
Revision of the
1969 TM
Convention
New measurement
convention needed
No direct impact
on the 1969 TM
Convention
Any other
ALTERNATIVES ?
Under the present
convention this
will demand
explicit
ratification by the
member states
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ALTERNATIVE SOLUTIONS TO THE USE OF
GROSS TONNAGE MEASUREMENT
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GROSS TONNAGE MEASUREMENT
An even more radical alternative than a change in the calculation of the GT
would be to abandon GT and to establish the size of the vessel on the
‘indisputable’ physical dimensions of the vessel, i.e. length overall, breadth
overall and summer draught and, amongst other, calculate the fees on theobtained volume basis.
Main physical
dimensions of a
vessel as a basis
for levying dues
breadth
WHAT CAN BE DONE ANYWAY TO IMPROVE SAFETY
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Irrespectively of a revision of the tonnage measurement system, it is necessary tocritically re-examine and impartially scrutinize the current safety requirements.
In particular it will be necessary to revise the vessel stability requirements andincrease the in-built safety margins. These should be made specific for variousship types.
In any event, even without the introduction of reduced or revised GTs, it is possible to improve the safety of the vessel by other instruments. These couldinclude
• improved stowage planning
• better supervision of cargo stowage in ports
• the generalized use of ship stability calculators
• the fitting of stabilizers
• etc.
CONCLUSIONS AND RECOMMENDATIONS
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The 1969 Tonnage Measurement rules as presently applied, tied to the many,
often unrelated thresholds imposed by a host of conventions, can make ships,
although built within all the stated rules, less safe than they could or should be
Ships are designed to minimise the total GT for a maximum earning capacity. As
a direct consequence, GT gives an incentive to reduce freeboard and or spare
buoyancy at the expense of safety. Scant attention is paid to innovative techniques
that could improve crew comfort, cargo care or vessel sea kindliness
Because virtually all safety margins have been used up and vessels have to
operate in circumstances that are considerably more taxing than the average
operating conditions on which most rules are based, the probability of cata-
strophic accidents and the occurrence of calamitous events cannot be ruled out
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Policy Research CorporationPolicy Research CorporationSOUNDSOUND SOLUTIONS BASED ON SCIENTIFIC RESEARCHSOLUTIONS BASED ON SCIENTIFIC RESEARCH
Consequences of the
Gross Tonnage (GT) measurement
Gustaaf De Monie, Senior Director
Office Belgium: Office The Netherlands:Jan Moorkensstraat 68 Parklaan 40
2600 Antwerp 3016 BC Rotterdam
tel : +32 3 286 94 94 tel: +31 10 436 03 64
fax : +32 3 286 94 96 fax: +31 10 436 14 16
e-mail : [email protected] e-mail : [email protected] : www.policyresearch.be website : www.policyresearch.nl
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