Chinese Law | China: Vol.2, No.04

CHINA MARITIME LAW NEWSLETTER

Vol. 2, No.4 - June 10, 2002

TOPICS THIS ISSUE:

Shanghai Yacht Owners Granted Moorage Rights
China Grants 60 Operating Permits to Foreign Carriers
Man-made Island Site of Deep Water Port
Mayor Container Players Compete for Tianjin Port Investment
Digital Port Centre Aids Business Flow
City Eyes Shipping Centre
Optimism on Rise in Shipping Industry
Shanghai to Host International Maritime Affairs Exhibition

Shanghai Yacht Owners Granted Moorage Rights

Having trouble finding a place to park your yacht in Shanghai? Why don't you buy your own private dock? Now, both corporations and individuals may apply to purchase moorage rights in the city. Zhang Youfen, director of the Shanghai Oceanic Administration, recently held a ceremony for the issuance of moorage licenses certificates, the first to be issued. Yacht owners have been seeking such rights for years.

An official at the maritime moorage department of Shanghai Oceanic Administration said that with implementation of the Law for Moorage, enterprises or individuals may buy moorage rights in the Shanghai area. According to the Shanghai Oceanic Administration, the price set by the central government in 1993 was 100 yuan (US$12.08) per mu (0.16 acre), and that a new price will be set to reflect increased costs.

(Source: ChinaBiz Daily)

China Grants 60 Operating Permits to Foreign Carriers

The Ministry of Communication has granted about 60 container-shipping lines International Liner Operating Permits to make it easier for carriers to launch new services or upgrade international maritime links with the Mainland. Both line-haul and feeder ship operators were included. Some 57 lines were in the first tranche to be issued permits, including Taiwan's Yang Ming Marine. The second wave announced 10 days ago included Taiwan's leading carrier, Evergreen Marine and European giant P&O Ned Lloyd. Ministry sources said last week the licenses were issued to ease the way through legislative tangles in China, which had "hindered the direct agreements for lines such as those operating in Taiwan to start direct calls in China". The ministry said it was an important move to help lines establish more trade with China.

(Source: China Daily)

Man-made Island Site of Deep Water Port

Since it is too difficult to relocate families from fishing communities on Xiaoyangshan Island, the expected home of a new deep-water port, Shanghai will instead build a man-made island for foundation of the shipping facility in Hangzhou Bay, officials announced yesterday.

The announcement came at the end of a four-day meeting by an expert group of engineers put together by the Ministry of Communications in Shanghai to evaluate the design of the first phase of the Yangshan Deep-Water Port. According to Zou Juexin, vice director of the expert committee, the decision to build a new island will add about 1.3 billion yuan (US$156 million) to the previous 13-billion-yuan budget, which has already been approved by the State Development Planning Commission. "It is difficult to resettle and re-plan the lives of more than 1,000 fishing families currently residing on the previously selected construction site on Xiaoyangshan Island," said Zou. "So, we decided to build a smaller island around the area of Huogaitang just beside the Xiaoyangshan Island, on which five berths will be constructed for container cargo."

Dayangshan and Xiaoyangshan islands, under the jurisdiction of neighboring Zhejiang Province, are 27.5 kilometers from the city's southern coast in Hangzhou Bay. Part of the plan calls for a sea-crossing bridge, 31.12 kilometers long and 31.5 meters wide, with a 24.5- kilometer section to be built 40 meters above the sea surface. Construction is scheduled to kick off next month. The first phase of the project is scheduled to be completed and put into operation before the end of 2005.

(Source: Shanghaidaily.com)

Mayor Container Players Compete for Tianjin Port Investment

The Tianjin Port in Northern China will invest US$ 181 million this year in its infrastructure to increase its competitiveness and capacity, various media sources reported. Part of the investment will go into the second phase construction of a navigational channel to handle the passage of 100,000 tons cargo ships. Two docks will be built and construction will commence on a 200,000 ton dock to transport mineral ore and a 250,000 ton dock for crude oil. A goods distribution centre and a conveyor belt corridor are also part of the plan.

A former coal terminal will be converted into a container facility and a large quay will be built into the channel extending it by 1.5 to 2 million in TEUs (20 foot equivalent unit) to the ports' already booming facilities. Last year Tianjin broke the 2 million TEU mark for the first time. In 2001, the port handled 113.69 million tons of cargo; up 18.8 percent from last year.

Danish Maersk Sealand the world third largest container terminal operator is interested to invest in the port. "With Tianjin port expected to grow 10 to 15 percent for each of the next three to five years, demand will continue to fuel supply," general manager at Maersk (China) Shipping Co. Richard Nicholson said.

(Source: Shanghai Daily)

Digital Port Centre Aids Business Flow

China's system of port management has received a high-tech boost with the opening of a new data sub-centre in Shanghai. The sub-centre integrates import and export business information, capital flow data and cargo distribution information, which were previously the responsibility of different government organizations.

China Customs and Shanghai Municipality built the sub-centre, the first of its kind in China. Commissioner Mu Xinsheng from the General Administration of Customs, and Shanghai Mayor Chen Liangyu opened the Shanghai E-port Data Centre during a two-day meeting on enhancing the efficiency of China's ports. Officials said the opening of the sub-centre indicated a new breakthrough in electronic port regulation systems. Mu said he believed the data centre would let different departments, different industries, and different regions share information online. It will offer companies comprehensive online services related to customs clearance. At present, 82,000 companies have registered on its website - www.chinaport.gov.cn.

Mayor Chen said the establishment of the sub-centre was a crucial part of the implementation of Shanghai's customs clearance facilitation strategy. Also at the meeting, State Councilor Wu Yi called on China's ports to improve their logistical efficiency in order to attract more foreign investment. She said Shanghai has set a good example for other customs authorities in the country.

(Source: Maritime News)

City Eyes Shipping Centre

As part of its plan to become an international shipping centre, Shanghai has kicked off two major watercourse development projects as part of a new development plan for its inland river shipping. The 50.5-kilometre-long Dalu Waterway starts from the Huangpu River and ends at an inland river in the under-construction Harbour City, a district in southwest Shanghai. Harbour City will serve as a backyard for the Yangshan Port, a deep-water port 30-kilometre southwest to Shanghai.

"This line is a bottleneck between the network of the Yangtze Delta and Yangshan Port, and we must break through it," said Gan Guande, deputy director of the Shanghai Urban Transport Administration Bureau. The projects will allow for the passage of boats holding 1,000-ton standard containers and is expected to cost 2.4 billion yuan (US$291 million). It will be completed by 2005 to keep pace with the operation of the Luyang Bridge and the first phase of Yangshan Port.

The shortest water passage between the Huangpu River and the standard-container port area in Waigaoqiao economic zone, Zhaojiagou Waterway, is to be dredged at a cost of 870 million yuan (US$105 million). The project, involving the renovation of nine bridges, is expected to be completed by 2005.

Shanghai municipal region has 210 inland rivers with a navigable distance of 2,100 kilometers. In 2001, 131 million tons of cargo, taking up nearly one fourth of the total handled, passed via the inland rivers. Although motor vehicle expressways have rapidly developed in the past 10 years, inland rivers have maintained a 23-25 per cent market share, transporting mainly fuel and bulk cargo. By 2005, the inland rivers will handle 150 million tons of cargo, consisting of 150,000-200,000 20-feet equivalent units. By 2020, 1.5-2 million 20-feet equivalent units will pass through inland rivers, according to estimates by shipping experts.

(Source: China Daily)

Optimism on Rise in Shipping Industry

Stronger business on some global trunk shipping lines is making Chinese industry officials upbeat. The composite China Container Freight Index, compiled weekly by the Shanghai Shipping Exchange as a barometer of the international container market, closed up 0.9 percent at 942.02 at the end of May 2002, mainly fueled by growth in shipments to the United States and Europe.

"Exports from the Far East to the United States have been increasing since February, thanks to a recovery in U.S. consumers' purchasing power," said Zhu Jinghai, an information officer at the exchange. "As a result, carriers are gradually regaining their confidence in the market and making plans to increase prices," Zhu said. U.S. West Coast-bound service increased 1.2 percent and East Coast-bound service jumped 3.3 percent from a week earlier. "An additional US$150 was charged for each TEU (20-foot equivalent unit) on U.S.-bound routes starting from June 1," according to Violet Zhu, Shanghai office manager for China Sea Marine, a major forwarding agency.

The Trans-Pacific Stabilization Agreement recently pushed up its annual forecast of trans-Pacific container volume, stating the trans Pacific traffic would likely grow 5 percent to 7 percent this year. Last year, it gained only 1.3 percent.

Encouraged by the market trend, Mediterranean Shipping Co. said it will open an Asia-U.S. East Coast route at the end of the month. The index for European-bound service rose 0.9 percent. Market participants said that freight rates for Europe will probably exceed US$1,000 per TEU soon, compared with US$800 to US$900 now. The participants cited China's improving export environment.

(Source: Shanghai Daily News)

Shanghai to Host International Maritime Affairs Exhibition

Companies from 14 countries are expected to attend the 2001 China International Maritime Affairs Exhibition and Seminar to be held December 4-7, 2002.

On display in the Shanghai International Exhibition Center will be the latest marine inventions, such as a "black box for a ship," which is designed to record data to help investigators find causes for maritime accidents. Also to be covered will be ship-building and repairs, maritime equipment and machinery, marine paint, propellers, navigation and telecommunications systems, and fire-fighting equipment.

Multinationals, including ABB Turbo System, Exxon Mobil, Mitsubishi Heavy Industries, Rolls Royce and Siemens AG, will be represented at the events.

(Source: People's Daily)

The China MARITIME Law Newsletter is intended to be used for news purposes only. It should not be taken as comprehensive legal advice, and Lehman, Lee & Xu will not be held responsible for any such reliance on its contents