Md. firms fined $518,000 in shipbreaking case
by The Associated Press, Baltimore Sun
29 January 2009 (Hagerstown) – Two Maryland companies have agreed to pay the federal government more than $518,000 to settle allegations they illegally sent an old ocean liner containing toxic PCBs overseas for disposal, the federal Environmental Protection Agency said today.
Cumberland-based Global Shipping LLC and an affiliate, Global Marketing Systems Inc., neither admitted nor denied the claims in an administrative consent agreement with the agency's regional office in San Francisco.
The case highlights the practice of sending old ships to ship-breaking yards in South Asia, where critics say unprotected workers are exposed to PCBs, asbestos and other toxins.
The agreement marks the first such penalty by the EPA after a ship has sailed, spokesman Dean Higuchi said. He said the EPA previously has gotten court injunctions to hold ships before they could leave port.
EPA alleged that the ship's components contained PCBs and that holding a vessel containing PCBs for purposes of export for disposal constitutes unauthorized distribution in commerce of PCBs.
More than 1.5 billion pounds of PCBs, or polychlorinated biphenyls, were manufactured in the United States before the government banned their production in 1978 because they can cause cancer in laboratory animals and harm the nervous, immune, and endocrine systems in humans. PCBs were commonly used in paints, industrial equipment, plastics, and rubber products.
Companies must ensure that PCBs are removed from any ship being exported to protect public health and the environment, said Jeff Scott, division director for waste programs in the EPA's Pacific Southwest region.
"Federal law prohibits companies from exporting PCBs for disposal, including PCBs built into ship components, unless approval from EPA has been obtained," Scott said in a news release.
Global Shipping purchased the Oceanic, a cruise ship formerly named the SS Independence, from Norwegian Cruise Lines in July 2007 but didn't inform the EPA of their intention to export the ship for disposal, the EPA said.
The vessel and a tug boat left the Port of San Francisco in February 2008 for Singapore, according to documents Global Shipping filed with the Department of Homeland Security describing the ship as "scrap."
After EPA initiated its enforcement action in March, Global Shipping submitted a new application to the Maritime Administration seeking approval to sell the ship, but changing the purpose of export from disposal to continued use in the Arabian Gulf area, EPA said.
Global Shipping didn't immediately respond to a request from the Associated Press for comment.
Under the agreement, the companies will pay within 30 days a total of $518,500 in penalties to resolve two Toxic Substances Control Act violations. Global Shipping will pay $486,000; Global Marketing Systems will pay $32,500.
The companies also must tell EPA where the ship is located, its intended destination and its intended disposition.
The Basel Action Network, a Seattle-based environmental group, said it tipped off the EPA to the ship's departure in conjunction with the Save the Classic Liners Campaign, which seeks to restore aged ocean liners.
"While the Oceanic wasn't recalled to the US, we're very happy that EPA took their job seriously and one of the world's leading cash buyers -- an exporter and exploiter of the infamous shipbreaking beaches of South Asia -- has finally been held to account," Jim Puckett, executive director of the Seattle group, said in a written statement.
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