Dutch Settle Decades Old Scrapping Case Over Sale of Toxic Reefer Vessels

The Netherlands’ Public Prosecution Service has reached a $6 million settlement in a long-running case involving the scrapping of four reefer cargo ships more than a decade ago. The case which started in 2018 marked the first time in Europe that a shipowner and its executives were brought up on criminal charges of exporting ships with toxic materials for scrapping overseas.

The case stemmed from the 2012 sale of four retired reefer vessels, Spring Bear, Spring Bob, Spring Deli, and Spring Panda by Dutch shipping company Seatrade. Prosecutors charged that the shipping company had sought to maximize its profit on the sale of the vessels by using cash buyers. 

Because the four vessels were used to transport refrigerated cargo, they were said to contain chemicals used in the refrigeration process that were harmful to the environment and the workers at the breaker’s yard. In addition, the ships based on their age contained PCBs and asbestos as well as oil and lubricating fluids. The prosecution reported that the four vessels departed from Rotterdam and Hamburg with these harmful materials still aboard. 

Built in 1984, the Spring Bear and Spring Bob ended up in India and Bangladesh. The other two vessels which were also built in 1984 were sold for breaking in Turkey.

The prosecutors report that Seatrade now acknowledges the transfer of the ships without complying with the environmental regulations. In addition, the company has committed to ensuring that in the future when ships are sold for dismantling it will comply with the applicable rules.

As part of the settlement, Seatrade and two of its directors will pay a fine of €2.65 million ($2.83 million). The company will also pay €3 million ($3.2 million) which was said to be equivalent to the profit the company made through the cash sale instead of following the required procedures.

The Rotterdam District Court in 2018 had ruled against the company based on the EU Waste Shipment Regulation. They found that the company had illegally exported the vessels for scrap. At the time, the prosecutor called for a fine of €2.55 million. They also asked for a one-year ban for the directors. The court found two of three directors guilty, but the case was overturned in 2020 by the Court of Appeal.

The case had been hailed by environmentalists for the strong message that it sent to shipowners in the European Union. Since this case, several others have followed including the 2020 prosecution of George Eide in Norway for the 2015 sale of a vessel that broke down and grounded on its way to the scrapyard in Pakistan. Eide was found guilty and sentenced to spend six months in jail.

European rules require special procedures for the sale of the vessels and handling of their recycling at EU-approved facilities. The rules are being further tightened to prevent the export of toxic materials and ensure proper handling and disposal. Despite this, activists are still protesting end-of-life ship recycling while highlighting continued efforts by various shipowners to evade the rules.