The Federal Maritime Commission (FMC) has launched an investigation into Canada’s ballast water rules that would require American ships to install ballast water treatment systems to call on Canadian ports.
The rule takes effect in September for a handful of American ships involved in the Great Lakes trade and in 2030 for the rest of the U.S. laker fleet. It would require ballast water treatment systems for ships that take on ballast water in Canada, even if they discharge that water across the international border in U.S. waters.
Trade groups like the Lake Carriers’ Association say the rules amount to an unfair trade practice aimed at protecting Canadian shippers at the expense of U.S. operators.
“We think the U.S. government should regulate ballast discharges in the U.S., and Canada should regulate discharges in Canada,” said Jim Weakley, president of the Lakes Carriers’ Association, a trade group that advocates for America’s Great Lakes shipping fleet.
“The only reason Canada is doing this is to create a trade barrier to give a monopoly to the Canadian fleet in the binational trade,” he continued. “And we believe Canada would be the only country in the world regulating the uptake of ballast water in addition to discharges.”
The FMC investigation is the latest salvo in the long-running battle over Canada’s proposed ballast water treatment regulations, which were introduced in 2021 to protests from carriers on both sides of the border. In addition to installing a ballast water treatment system, operators must comply with new record-keeping requirements. Ships built or modified since 2009 have until this fall to meet the regulation, while older vessels have until 2030.
The FMC opened a similar inquiry in 2021 but ultimately put it on hold while the U.S. Environmental Protection Agency developed rules under the Vessel Incidental Discharge Act passed in 2020. That process is almost complete, with final regulations at the Office of Management and Budget for approval. They will likely be released this fall. Based on the proposed regulations and the supplemental notice of proposed rules, the Lake Carriers’ Association believes the two countries will continue to have different regulatory protocols around ballast water.
The FMC probe will investigate whether Canada’s rules create “a disparate effect” on U.S.-flagged ships, thus constituting a Foreign Shipping Practices violation, the agency said in May.
“U.S.-based companies operating ships in the U.S.-Canada Great Lakes trade maintain that Canadian 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 FMC said in a news release.
Most of the 60 or so American ships working in the Great Lakes trade carry ore and other bulk cargo between U.S. ports. Weakley estimated that accounts for 90 percent of the cargo carried aboard American ships. He said that other 10 percent that is moved between the U.S. and Canada is threatened by Canada’s regulations, which would close those ports to U.S. ships that do not meet the new regulations.
Given the age of the U.S. Great Lakes fleet, only a handful of vessels will be subject to the new rules this fall, Weakley said. But they include the 639-foot Mark W. Barker, built in 2022 for Interlake Steamship Co., and multiple articulated tug-barge units.
Supporters of the rule say it will prevent the spread of aquatic invasive species from within the Great Lakes ecosystem. In 2021, the Canadian section of the Great Lakes Fishery commission estimated the rules would slow or stop the spread of some 34 invasive species around Canadian ports.
Transport Canada said it is closely following the FMC investigation. In a statement, the agency said its rules apply equally to U.S. and Canadian vessels and impose the same standards on both fleets. It argued the rules are justified under existing international regulatory agreements and would have minimal effects on U.S. business.
Transport Canada also argued the rules benefit the public interest, with a net benefit by addressing environmental risks. It has made these arguments to the FMC in a series of comments.
“Canada has clearly laid out that its regulations to address the risk of invasive species are based on evidence and science, with the same considerations given for U.S. and Canadian vessels in the Great Lakes,” said Hicham Ayoun, a senior Transport Canada spokesperson.
Shipping groups, however, question how effective the rule will be in the first place. They argue that joint U.S.-Canada ballast water rules applied in 2006 have already prevented the introduction of new invasives into the ecosystem. There also are concerns that existing ballast water treatment systems are ineffective on fresh water within the Great Lakes.
Weakley said high levels of tannins and suspended solids along with wide variations in water temperature and the very high ballast water discharge rates limit these systems’ effectiveness. “The technology doesn’t work on our vessels in the Great Lakes,” he said.
The FMC’s general counsel will lead the agency’s investigation into the Canadian ballast rules and present a report within 120 days. Barring an extension, that document should be available this fall. Serious sanctions are possible if the FMC determines the new rules violate Foreign Shipping Practices provisions, including offsetting sanctions or assessing fees on Canadian-flagged ships.