Protecting vital sea lines of communication: A study of the proposed designation of the Straits of Malacca and Singapore as a particularly sensitive sea area

Ocean & Coastal Management 57 (2012) 79e94

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Protecting vital sea lines of communication: A study of the proposed designation of the Straits of Malacca and Singapore as a particularly sensitive sea area Mohd Hazmi Bin Mohd Rusli Faculty of Syariah & Law, Universiti Sains Islam Malaysia, Bandar Baru Nilai, 71800 Nilai, Negeri Sembilan, Malaysia

a r t i c l e i n f o

a b s t r a c t

Article history: Available online 14 December 2011

The Strait of Malacca is considerably bordered by Malaysia and Indonesia while the Strait of Singapore is jointly shared by Malaysia, Indonesia and Singapore. Together, both Straits serve not only as two of the most important sea lines of communication in the world, but are important economic lifelines for the coastal population especially in the fisheries and tourism industries. The historical, environmental and socio-economic values of the Straits have resulted in some of the areas within the Straits have been designated as UNESCO World Heritage Sites, RAMSAR Sites and a UNESCO Geopark. Nevertheless, with the increasing shipping traffic in the future, it is feared that the marine environment of the Straits of Malacca and Singapore might be damaged. Focusing on issues pertaining to vessel-source of marine pollution, this article discusses the question on whether or not the Straits of Malacca and Singapore may potentially fit to be designated as a Particularly Sensitive Sea Area. This article concludes by discussing the possible legal and political consequences that may arise out of such a designation. Ó 2011 Elsevier Ltd. All rights reserved.

1. The Straits of Malacca and Singapore

2. Fisheries, tourism, biodiversity & World Heritage Sites

The Strait of Malacca separates the mainland Malay Peninsula and the Indonesian island of Sumatra, forming a funnel-shaped waterway as it narrows to the south. It has many tributary waterways along its length, namely Strait of Bengkali, Strait of Rupat and Strait of Johor (George, 2008, pp. 5e6). As it goes south, it ends in areas between Malaysia’s Tanjung Piai and Indonesia’s Pulau Karimun Kecil and subsequently joins the Strait of Singapore, which is located between the island Republic of Singapore, the south coast of Eastern Johor and the islands of Riau in Indonesia (Leifer, 1978, pp. 51e53) The Strait of Singapore, which is about 60 miles long, is a gateway to the larger South China Sea that acts as a link to the Pacific Ocean. Its narrowest width is off the southern tip of Singapore where it is slightly more than a kilometre (Oei and Forbes, 2003, p. 141). The Straits of Malacca and Singapore have been consistently described as two of the most important oil transportation choke points on the planet (Cheng et al., 2008, pp. 10e11). With the emerging economies of East Asian giants namely China, Japan and South Korea, the Straits of Malacca and Singapore will continue to increase in their significance as tanker pipelines connecting the oil producers in the Middle East with their East Asian consumers (Sien and Ahmad, 1998, pp. 103e104).

The Straits of Malacca and Singapore are important fishing grounds for their coastal populations. Their coastlines are rich with mangrove vegetations and extended mudflats, which are vital breeding grounds for important fishes, prawns, crabs and other marine creatures (Hooi et al., 2008, p. 72). The marine fisheries industry in Malaysia contributes considerably to the national economy in terms of income, foreign exchange and employment (Ishak et al., 2008, p. 88). In 2007, the total number of fish landings in Peninsular Malaysia’s West Coast States was around 692,985 tonnes valued at RM2.263 billion and in 2009, the number of fish landings has increased up to 729,558 tonnes, an increase of about 5% of that of 2007 (Kasmin, 2010, pp. 61e65). Furthermore, coastal areas on both Straits of Malacca and Singapore are also renowned for their many white sandy beaches, coral reef concentration, getaway islands and many other natural attractions, either on the Sumatra side, or the western coast of Peninsular Malaysia and the Riau Islands to the south. Besides being significant for fishing and tourism industries, the Straits of Malacca and Singapore and their coastal areas are also vital for biodiversity conservation as they are habitats for many scarce and endangered fauna such as migratory birds, monkeys, fruit bats, estuarine crocodiles, dolphins, dugongs, turtles and fireflies (Hooi et al., 2008). Matang Mangrove Forest Reserve which is located in the western coast of Peninsula

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Malaysia facing the Strait of Malacca is the largest mangrove reserve in Malaysia and possess sensitive marine and coastal environment. There are also concentrations of the coral reef in some areas of the Straits such as in Cape Rachado (Tanjung Tuan) and Pulau Payar Marine Park which are natural homes for marine life like sea sponges, crustaceans and coral reef fishes. The island of Langkawi is one of the islands along the Strait of Malacca that is rich in biodiversity, as it has numerous sandy beaches, mangrove forests, tropical rainforests and natural caves which are habitats for many species of flora and fauna. Due to this, UNESCO has, in 2007 included Langkawi Island as one of its Global GEOPARKS,1 as three areas within the island possess geological significance that are Gunung Mat Chincang, Kilim and Pulau Dayang Bunting. The southern tip of Asia, Tanjung Piai, alongside with Pulau Kukup and Sungai Pulai, areas which are busy with shipping activities have also been designated as one of the ‘RAMSAR sites’2 due to its significance in wetland conservation (“The Annotated Ramsar List: Malaysia, 2008”). Some areas of the Malaysian coast facing the Strait of Malacca are bestowed with extensive areas of mudflats as shown in Fig. 1. The prominent mudflat sites include Kuala Gula, Kuala Merbok, Kuala Selangor, Pontian and Tanjung Piai (Ishak and Hooi, 2008, p. 88). These mudflats form natural habitats for shellfishes, residential and migratory waterbirds and also act as important cockle breeding grounds. It is based on these facts that many regard both the Straits of Malacca and Singapore and its surrounding areas as a region which are not only rich in biodiversity, but are also considered to contain the greatest species diversity of marine life in the world (Mazlan et al., 2005, pp. 76e87). Collectively, the Straits of Malacca and Singapore have been regarded as an ancient trading route. The historical, cultural and educational significance of the Straits resulted in Malacca and Georgetown, Penang, two historic cities on the coast of the Strait of Malacca to be recognised by the United Nations Educational, Scientific and Cultural Organization (UNESCO) as World Heritage Sites (“Melaka and George Town, Historic Cities of the Straits of Malacca 2011”).

3. Straits of Malacca and Singapore as the world’s main shipping arteries From waterways that ferried traditional commodities like spices, camphor and nutmegs in its bygone eras to modern shipments of crude oil, petroleum products, electronic goods and motor vehicles, both the Straits of Malacca and Singapore still are intact with their reputations not only as two of the most crucial shipping lanes on Earth, but also as the longest straits used for international navigation in the world (J.H. Ho, 2009b, pp. 233e234). In terms of density of navigational traffic, the Straits of Malacca and Singapore came in second only to the Dover Strait, an important European chokepoint connecting the North Sea and the Atlantic Ocean (Graham, 2006, pp. 155e160).

1

UNESCO defines a GEOPARK as a nationally protected area containing a number of geological heritage sites of particular importance, rarity or aesthetic appeal. These Earth heritage sites are part of an integrated concept of protection, education and sustainable development. (Global Geopark Networks, 2006). 2 The Convention on Wetlands of International Importance, otherwise known as the Ramsar Convention, is an intergovernmental treaty that provides the framework for national action and international co-operation for the conservation and wise use of wetlands and their resources. The mission of the Convention is to conserve and to wisely use all wetlands through local and national actions and international co-operation, towards achieving the goal of development sustainability. (“The Annotated Ramsar List: Malaysia, 2008”).

Fig. 1. Areas along the Strait of Malacca with high cultural, economic, educational and historical importance. (Source: Google Maps).

The rapid developments of the economies of China, Japan and South Korea in the recent years have increased the importance of the Straits of Malacca and Singapore as natural pipelines for these East Asian economic powerhouses (Guoxing, 2000). Apart from the United States of America (the US), China is also one of the world’s biggest consumer of oil and gas (“U.S. Energy Information Administration Independent Statistics and Analysis: China, 2009”). The East Asian economies rely on their Middle Eastern supplier for their supply of crude oil, and Straits of Malacca and Singapore are, from the geographical point of view, the shortest seaways connecting these two parts of the world (Hamauzu et al., 2005, pp. 50e76). The Lloyd’s MIU reported that in 2007, crude oil is the commodity most being ferried eastbound via the Straits of Malacca and Singapore amounting to 679 million tonnes in weight (Mandryk, 2008). The same year, the overall dead weight tonnage (DWT) of eastbound traffic was as high as 2,098,725,204 in DWT and oil tankers formed 27% of all transits in the Straits of Malacca and Singapore. Most industries in East Asia and Southeast Asia export their products to other parts of the world mainly via the Straits of Malacca and Singapore route. As a result, since 2001, the navigational traffic in the Straits of Malacca and Singapore has been, in exception of 2005 and 2009, growing steadily as shown in the following Table 1: Table 1 Number of vessels transiting the Straits of Malacca and Singapore (2001e2009). Year

Transiting traffic

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

55957 59314 60034 62334 63636 62621 65649 70718 76381 71359 74133

(Source: Port Klang VTS).

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Vessels plying the Straits of Malacca and Singapore fly various flags, and in terms of owner nationality, the littoral States of Malaysia and Indonesia are not the main users of the Straits as shown in Table 2: Table 2 Top 10 transits by owner nationality (2007). Country

Number of transits (approximate)

DWT (mil) (approximate)

Japan Germany Greece Singapore China Indonesia Malaysia Taiwan Hong Kong South Korea

12,000 9,000 7,000 4,500 4,500 4,300 4,200 3,000 2,000 1,800

900 400 600 150 300 100 120 150 250 220

(Source: Lloyd’s MIU).

If these Straits are closed for navigation, ships will be forced to traverse the longer Lombok and Makassar routes through Indonesian archipelagic waters, inevitably adding to shipping costs (Sondakh, 2004, pp. 79e80). As a result, the navigational distance for ships would be extended by 1000 nautical miles (Song et al., 2009, p. 84). After the recent spikes in crude oil prices in 2008, this would mean an extra shipping cost of US$500,000.00 per ship per transit for a large vessel such as a Very Large Crude Carrier (VLCC) (Sakamoto, 2008, pp. 1e3). The Straits of Malacca and Singapore are important for reducing transportation costs. Any interference with the free flow of maritime traffic through these waterways would be detrimental for international trade and the global economy (H. M Ibrahim et al., 2008, pp. 31e38) Table 2. 4. The legal status of the Straits of Malacca and Singapore During the negotiation of the United Nations Conference on the Law Of the Sea III (UNCLOS III), maritime States were persistent to ensure that the Straits remain open for navigation whereas States bordering straits were adamant to contend those straits are within their territorial Seas and are not international waters (Djalal, 1999, pp. 457e469). After long and intense deliberations among nations of the world, UNCLOS III concluded by attempting to satisfy both interests and as such, the term ‘international straits’ was replaced with ‘straits used for international navigation’, as embedded in Part III of the LOSC. With the entry into force of the LOSC in 1994, transit passage regime applies to all foreign merchant ships that sail through almost all straits used for international navigation located around the world. Part III of the LOSC expounds on the legal status of straits used for international navigation and is applicable to both Straits of Malacca and Singapore. The regime of transit passage provides for continuous and expeditious passage of all vessels and aircraft through straits used for international navigation which cannot be denied, hampered or impaired by the bordering States (Rusli, 2009). States that border straits used for international navigation must give appropriate publicity to any danger to navigation or overflight within or over the straits of which they have knowledge (R. Beckman, 2004, pp. 249e250). Unlike the regime of innocent passage where the coastal States have the right to temporarily suspend passage of foreign vessels for reasons essential for the security of the coastal State,3 the bordering States of straits used for international navigation do not have this right. Article 233 of Part

3

Article 25(3) - (LOSC (1982)).

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XII of the LOSC further limits the enforcement powers of States bordering straits as passage of foreign vessels through straits used for international navigation could only be suspended if the passage causes major damage to the marine environment of such straits.4 The LOSC in its Article 43 does however encourage both States bordering straits and the user States to cooperate in maintaining and preserving the marine environment of the straits. 5. The impacts of shipping activities on the Straits of Malacca and Singapore Despite being the most convenient route connecting the Middle Eastern oil producers to its major consumers of East Asia, the Straits of Malacca and Singapore are not entirely safe for navigation (Rusli, 2011f). The waters of the Straits are relatively shallow, and the water level varies with the changing of the tides. The seabed also shifts, creating serious risks of groundings. Due to this, in certain areas of the Straits, the IMO has recommended a maximum draught of 19.8 m for passing ships. The Straits narrow at different points along their length with the narrowest point in the Strait of Singapore being only 3.2 km in breadth hence making navigation in the Straits more intricate. Accidents and maritime collisions in the Straits of Malacca and Singapore are also influenced by other factors such as the heavy density of traffic, poor visibility during squalls, numerous shoals and banks that often change in location along the waterways, confusing crossing patterns by small domestic craft and several wrecks in certain localities along the Straits (Rusli, 2011f). There have been 888 accidents reported to have occurred in the Straits of Malacca and Singapore in the 25 year period of 1978e2003 (Basiron and Hooi, 2007, pp. 15e16). Between the years of 2001e2007, 236 maritime casualties took place in the Straits (George, 2008, pp. 10e11). It was also reported within the 10-year period of 2000e2010, accidents involving container ships form 31% out of the overall percentage with approximately 69% of maritime casualties taking place within the TSS (Ibrahim, 2011). As shown in Table 3, these accidents can be categorised as follows:

Table 3 Casualty breakdown in the Straits of Malacca and Singapore (2001e2007). Types of casualty

Number

Collision Groundings Founderings Fire/explosions

73 113 21 29

Total

235

(Source: George, 2008).

The major oil and hazardous and noxious substance (HNS) spills in the Straits of Malacca and Singapore are summarised in the following Table 4: Oil spill incidents entail adverse impacts on the marine environment. They may deteriorate the well-being of sea and coastal wildlife through destruction of foreshore and marine ecosystems and their natural habitats (Malaysia’s Response to the Evoikos Incident, 1998). An oil slick has devastating effects on everything that it touches, either in the open sea or in the coastal areas.

4 Article 233 of the LOSC allows States bordering straits to take appropriate enforcement measures against ships that has caused or threatening to cause major damage to the marine environment of the Straits.

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Table 4 Selected maritime accidents in the Straits of Malacca and Singapore. Date

Vessel name

Type of oil and HNS

Quantity of spillage (barrels)

Location and cause

6/1/1975 12/7/1978 20/9/1992 15/10/1997 21/5/1999 3/10/2000 13/6/2001 19/08/2009 25/05/2010 29/07/2011

Showa Maru Tadotsu Nagasaki Spirit and Ocean Blessings Evoikos and Orapin Global Sun Vista Natuna Sea Indah Lestari MT Formosa Brick and MV Ostende Max MV Waily and MT Bunga Kelana 3 B Oceania and Xin Tai Hai

Crude Crude Crude Crude Fuel Oil Crude Phenol Naphtha Light Crude Oil Not applicable

54,000 293,000 100,000 175,000 14,000 49,000 89 Not applicable 18,000 Not applicable

Singapore Strait/Grounding Malacca Strait (Dumai)/Unknown Malacca Strait/Collision Singapore Strait/Collision Malacca Strait/Sinking Singapore Strait/Grounding Johor Strait/Sinking Malacca Strait/Collision Singapore Strait/Collision Malacca Strait (Pulau Pisang)/Collision

(Source: MIMA & Environment Canada).

In 1993, an oil spill caused by a collision between the Singapore-registered oil tanker, Slimy, and an LPG carrier, Explode, took place in the narrow waterway near Singapore’s resort island of Sentosa in the Strait of Singapore (Marine Pollution Management in Malacca/Singapore Straits: Lesson Learned, 1998; pp. 107e108). About 5000 tonnes of oil valued at US$7.5 million dribbled out of Slimy and it also spilled all of its bunker oil into the sea. The beauty of beaches around Sentosa Island was contaminated by the oil spill and the hotel owners suffered losses estimated at US$1.5 million. This was followed by the 1997 collision between MT Evoikos and MT Orpin Global in waters of the Strait of Singapore. The Cypriot tanker Evoikos ran over a Thai tanker Orapin Global whilst navigating through the Strait of Singapore on 15 October 1997 (Malaysia’s Response to the Evoikos Incident, 1998). The Evoikos, which was transporting approximately 130 000 tonnes of heavy fuel oil, sustained damage to its three cargo tanks spilling an estimated 29000 tonnes of heavy fuel oil into the sea. Fortunately, the Orapin Global, which was in ballast, did not spill any oil. The spill affected about a dozen of southern islands and islets off Singapore. Subsequently, by 19 October 1997, the oil slicks drifted into the Malaysian and Indonesian waters of the Strait of Malacca in a northwesterly direction. On 23 December 1997, oil came ashore in places along the 40 km length of the Selangor coastline, including several short sandy beaches, a 1 km stretch of rocks, a concrete breakwater and two separate areas of mangrove. Things were made worse on November 20th, 1997, when a Belize registered general cargo ship, An Tai sank at the berth in Port Klang, spilling an unknown quantity of fuel oil. Some of the oil spilt from the An Tai subsequently became mixed with slicks further out in the Straits originating from the Evoikos collision. The Maritime and Port Authority of Singapore (MPA) was responsible for the clean-up operations. Clean-up equipment owned by East Asia Response Ltd (EARL) and the Petroleum Association of Japan (PAJ) were deployed in the task (Malaysia’s Response to the Evoikos Incident, 1998). The oiled coasts of Pulau Hantu and Raffles Light were cleaned by a commercial contractor using dispersant and seawater pumps at a cost of S$400,000 (UK£145, 000). The whole clean-up process was estimated to cost around UK£1, 500,000. The scenario was a little different in Malaysia. When the slick reached Malaysian shores, it was virtually solid and had spread over a large area. As a result, at-sea recovery operations were no longer effective. In the event, some 5 km of shore were oiled. Onshore clean-up operations were co-ordinated by the Malaysian Department of Environment assisted by the Marine Department (Malaysia’s Response to the Evoikos Incident, 1998). There was, however, no reported damage on the Indonesian part of the Straits. This oil slick posed hazards not only to the marine environment but also to the mangrove swamps and jungles, fish and prawn farms in coastal areas. It also disrupted the tourism industries on the south-

western coast of the State of Johor. The costs of cleaning up were high. For example, the Diego Silang 1976 oil spill clean up itself cost US$1,086, 421.00 while the Nagasaki Spirit oil spill incident in 1993 incurred a clean-up expenditure amounting to US$1,506,160.00 (Basiron, 1995). Due to the increasing shipping traffic, maritime accidents and casualties are still happening in the Straits of Malacca and Singapore. In 2009, there was a collision between a Liberian registered tanker, MT Formosa Product Brick and an Isle of Man-registered tanker, MV Ostende Max, in the waters off Port Dickson, Malaysia (BERNAMA, 2009). Fortunately, after extensive monitoring work, the Malaysian Maritime Enforcement Agency (MMEA) confirmed that neither naphtha nor oil spills had taken place (R. Ahmad, 2009). In 2010, a tanker identified as MT Bunga Kelana 3 collided with a bulk carrier MV Waily in Malaysian waters off the coast of Singapore resulting in an oil spill (Collision off Singapore Spills oil, 2010). The Malaysian-registered tanker MT Bunga Kelana 3, which was ferrying 63, 054 tonnes of light crude oil from Bintulu to Malacca suffered damage to one if its cargo tanks spilling an estimated 2000 tonnes of oil into the Strait of Singapore (Basiron, 2010, p. 39). Despite the assurance by the authorities that utmost was being done to contain the spill, some oil did reach the shores of Johor and Singapore and this prompted an outcry and claims of loss of livelihood by fishermen. As stated by Basiron: The environmental and ecological impact of oil spills must be considered. Besides wildlife, dirty beaches and ecosystems such as mangroves could also be affected. While the long term effect of oil spills on mangroves is yet to be ascertained, the sight of mangrove roots covered in oil is reason for concern. A spill in ecosystems such as coral reefs could be disastrous to the fishing and tourism industry not to mention the livelihood of coastal communities (Basiron, 2010, p. 39). These examples manifest the marine environmental threats that could be caused by oil spill incidents as a result of a maritime accident in the Straits of Malacca and Singapore. The effects of such tragedies could be detrimental not only to the economic well-being of the coastal population, but also to the particularly sensitive marine and coastal areas which are natural habitats to a number of flora and fauna species namely the Tanjung Piai RAMSAR Site, Matang Mangrove Forest Reserve and Langkawi UNESCO Geopark. The 1997 Evoikos collision also showed that even though the spill might have taken place outside Malaysian territorial waters, it could also ultimately affect Malaysian national waters, as the slick may flow away from the scene of the accident. Furthermore, the risks of maritime accidents in areas of the Strait of Malacca near Malacca stretching down to the south towards the Strait of Singapore are quite high as the Strait became narrower in breadth and this is where the Traffic Separation Scheme (TSS) operates. This part of the Strait of Malacca is relatively busy with navigational traffic sailing eastbound and westbound.

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It is a correct assertion that shipping is not the sole cause of pollution in the Straits of Malacca and Singapore. In fact, the landbased source of pollution generated from the high development of growth and urbanisation of the coastal areas facing the Straits is also the main cause of pollution in the Straits of Malacca and Singapore (Kaur et al., 2008, p. 128). The World Wildlife Fund (WWF) has reported that over 80% of marine pollution comes from landbased activities (“Problems: Ocean Pollution, 2010”). Therefore, one could assert that shipping activities cannot be totally blamed for the deterioration of the marine environment of the Straits of Malacca and Singapore. However, this assertion may not be entirely true if this is looked upon from the enforcement point of view.

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managing the issues on safety of navigation and the control of vessel-source pollution in the Straits (J. Ho, 2009a, pp. 233e247). Nevertheless, these developments have not kept pace with the increasing number of ships that transit the Straits of Malacca and Singapore each year. This is justified by the fact that the 2009 budget for the Aids to Navigation Fund (the Fund) was USD8 million but it has managed to raise only around USD5 million, with USD2.5 million coming from the Nippon Foundation (Bateman, 2009, pp. 45e51). In 2010, the amount raised was even lesser at USD3 million contributed by various governments and other stakeholders of the Straits of Malacca and Singapore as shown in the following Table 5:

Table 5 Contributions made to the fund in 2009 & 2010 & 2011. No.

Country/Organisation

Amount (USD)-2009

Amount (USD)-2010

Amount (USD)-2011

1. 2. 3. 4. 5. 6. 7. 8. 9.

United Arab Emirates (UAE) South Korea India China Nippon Foundation Saudi Arabia Middle East Navigation Aids Service (MENAS) Malacca Strait Council (MSC) International Maritime Organization (IMO)

100,000.00 83,532.00 774,000.00 e 2,500,000.00 e 1,000,000.00 500,000.00 50,000.00

100,000.00 88,235 e 250,000.00 1,390,000.00 100,000.00 1,000,000.00 500,000.00 50,000.00

100,000.00 91,500.00 993,000.00 200,000.00 1,000,000.00 e e 500,000.00 50,000.00

5,007,532.00

3,478,235.00

2,934,500.00

Total

(Source: Maritime Institute of Malaysia [MIMA] & Marine Department of Peninsular Malaysia).

The littoral States of Malaysia, Indonesia and Singapore have absolute and full powers to regulate matters on land-based source of pollution as they possess full sovereignty over their respective land territories. The littoral States may regulate their own unilateral laws, regulations and measures to deal with land-based source of pollution without having to be bound by the application of international law. Singapore has successfully managed to develop a modern waste management and disposal system that is effective in controlling the discharge of land-based source of pollution into the sea within that city-State (Zhang et al., 2010, pp. 921e933); (“Yearbook of Statistics Singapore, 2009”). Malaysia and Indonesia are following Singapore’s footsteps towards developing a modern and effective waste disposal system in tackling land-based pollution problems in their respective countries (Chaerul et al., 2007, pp. 41e49); (Aseed et al., 2009, p. 2210). Unlike the management of land-based source of pollution, the littoral States have no absolute powers when it comes to regulating vessel-source pollution especially in their respective territorial Seas within the Straits of Malacca and Singapore, as their powers are constrained by the application of Parts III and XII of the LOSC. Therefore, vessel-source pollution does matter and problems arising from it should not be taken lightly. 6. Co-operative mechanism in the straits of Malacca and Singapore Currently, there is an ongoing cooperative mechanism scheme5 between the littoral States and the User States in

5 The Co-operative Mechanism reflects the success in enhancing co-operation between the littoral States and the user States which is supported by the LOSC itself in Article 43. The scope of the Co-operative Mechanism focuses on three components namely the Co-operation Forum for dialogue and discussion, Project Co-ordination Committee on the implementation of projects in co-operation with sponsoring users/stakeholders and Aids to Navigation Fund to receive direct financial contributions for renewal and maintenance of aids to navigation (R. Beckman et al., 2009).

Despite the decreasing amount of financial contribution made by the users to the Fund, however, since 2009, more user States have shown interest to share the burden with the littoral States and assistance are generally rendered through the sharing of maritime technology to ensure safer shipping in the Straits of Malacca and Singapore under the Project Co-ordination Committee (PCC) administered by the Co-operative Mechanism (M. R. b. Ahmad and Rozali, 2009). Nonetheless, given that the Straits are projected to accommodate constant increase of shipping traffic in the future coupled with the escalating costs of maintenance of aids to navigation in the Straits, the cooperative mechanism scheme particularly the Fund may not be entirely sufficient to promote sustainable use of the Straits of Malacca and Singapore for international shipping activities. The following Table 6 shows the amount of contribution vis-à-vis the annual cost for the maintenance of aids to navigation: Table 6 Contributions versus annual cost for the maintenance of aids to navigation. Year

Contribution (US$)

Annual average cost (US$)

2008 2009 2010 2011

1,451,000.00 5,007,532.00 3,478,235.00 2,934,500.00

1,354,000.00 5,500,000.00 5,500,000.00 5,500,000.00

(Source: MIMA and TTEG).

The provisions of the transit passage regime were negotiated when principles of international environmental law were just beginning to emerge. The framework for protection and preservation of the marine environment in the LOSC has been considerably amplified by modern conservation principles and norms such as the precautionary principle, conservation of biodiversity, sustainable use and the polluter pays principle since the LOSC was negotiated (Rusli, 2011e; pp. 122e130). Therefore does the right of transit passage remain unqualified? Bateman asserts: The right of transit passage may be increasingly qualified in the future by the growing trend among coastal States to introduce

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measures for the protection of the marine environment which impact upon navigation (Bateman et al., 2009, pp. 274e275). Australia and Papua New Guinea (PNG) have pioneered a new development in State practice on the governance of straits used for international navigation when they have, for the first time, been successful in extending the Great Barrier Reef Particularly Sensitive Sea Area (PSSA) to the Torres Strait, with compulsory pilotage as its Associated Protective Measure (APM). This State practice may be an early sign that the assumption that transit passage is an unqualified navigational right for all vessels and aircrafts exercising transit in straits used for international navigation has been modified to take into accounts the environmental responsibilities of both the littoral States and the user States. 7. Particularly sensitive sea area The International Maritime Organization (IMO) is the only international body responsible for Particularly Sensitive Sea Area (PSSA) designation. A PSSA is an area that needs special protection through action by IMO because of its significance for recognised ecological or socio-economic or scientific reasons and which may be vulnerable to damage by international maritime activities (“Particularly Sensitive Sea Areas, 2002”). An application to IMO for designation of a PSSA and the adoption of APMs or any amendment(s) to them, may be submitted only by a Member Government of the IMO (Revised Guidelines For the Identification and Designation of Particularly Sensitive Sea Areas, 2006). APMs are essential parts of a PSSA in which the APMs define the means by and the extent to which a PSSA is protected against environmental threats posed by international shipping activities (Kachel, 2008, pp. 171e175). A co-ordinated proposal should be formulated where two or more Governments have a common interest in that particular area. Resolution A.982 (24) or its full name, Revised Guidelines for the Identification and Designation of PSSAs, states that An application for PSSA designation should contain a proposal for an APM or measures aimed at preventing, reducing or eliminating the threat or identified vulnerability. APMs for PSSAs are limited to actions that are to be, or have been, approved and adopted by IMO, for example, a routeing system such as an area to be avoided. To date, the Torres Strait is the only strait used for international navigation that has been designated as a PSSA. Located at the northern end of the Great Barrier Reef, the Torres Strait is a waterway that is difficult to navigate through given that it is dotted with small islands and islets, fringing reefs, having shallow waters and strong tidal flows along its length. In addition, the Torres Strait and its surrounding areas including the Cape York Peninsula and the Gulf of Carpentaria possess pristine and sensitive marine environment and harbours an extraordinary diversity (Kaye and Mangone, 1997). Nevertheless, the Torres Strait was not listed as part of the Great Barrier Reef World Heritage Site by the UNESCO in 1981 (Great Barrier Reef-World Heritage Centre et al., 2011). Although the Torres Strait is located considerably far from many major urban areas of Australia, it is still important for commercial fisheries activities as well as traditional fisheries activities which are particularly practiced among the indigenous population. The many islands on the Torres Strait are also home of the Torres Strait Islander, a group of Australian indigenous people that dwell within that area (Forbes, 2009). With these character stics, the Torres Strait has the potential to fulfill the criteria for the designation of PSSA, as enumerated in Resolution A.982 (24), inter alia:

(a) ecological criteria by possessing sensitive and unique coastal and marine environment6; (b) the Torres Strait is an area which is of particular importance to utilisation of living marine resources7; (c) the Torres Strait and its surrounding areas is of particular importance for the support of traditional subsistence and/or cultural needs of the local human population, in particular the Torres Strait Islanders8; (d) Since the marine and coastal areas along the Strait are rich in biodiversity, the Torres Strait is also an area of high scientific interest and is important for educational purposes.9 Due to increasing shipping traffic and the higher risks of maritime accidents in the Torres Strait, Australia contends that the sensitive ecosystem of the Strait could be damaged by uncontrolled international shipping. Prior to the imposition of compulsory pilotage in the Torres Strait, there had been a decrease in the number of vessels that engaged pilots when navigating through the waterway. Australia was concerned that if a maritime casualty took place in the Torres Strait, the environmental implications would be disastrous. Successive governments have been concerned to ensure that the tragic grounding of Oceanic Grandeur in the Torres Strait in March 1970 (“Major Oil Spills in Australia: Oceanic Grandeur, Torres Strait, 3 March 1970”) and of Bunga Teratai Satu on Sudbury Reef within the Great Barrier Reef region in 2001 (Glover, 2004), pp. 63e69) should not happen again. Fortunately, the grounding of the latter did not result in any discharges from the vessel but it did affect the well-being of the Reef. In 2003, Australia and PNG submitted to the IMO a proposal to extend the Particularly Sensitive Sea Area (PSSA)10 status on the Great Barrier Reef to the Torres Strait. After much deliberation, the IMO approved the extension of the Great Barrier Reef PSSA to the Torres Strait in Marine Environmental Protection Committee (MEPC) Resolution 133(53) on 22 July 2005 (R. C. Beckman, 2007, pp. 325e357). Following approval by the IMO Assembly in Resolution MEPC 133(53) which revoked Resolution MEPC 45(30), Australia issued its Marine Notice 8/2006 advising all vessels of 70 m of length or more, and all loaded tankers and liquefied gas carriers to engage a pilot while navigating through the pilotage area of the Torres Strait (Revised Pilotage Requirements for Torres Strait, 2006). As a vessel approaches the Torres Strait, it will be interrogated by the Automatic Identification System (AIS) shore stations. These AIS stations identify passing vessels and if the vessel ignores the requirement to take on a pilot, it will then be identified and subject to legal proceedings when it enters any Australian ports in the future (Bateman et al., 2009, p. 270). Ever since the imposition of the compulsory pilotage regime in the Torres Strait, the number of casualties have been kept to a minimum. This regime is achieving

6 Articles 4.4.1 to 4.4.11 of Resolution A.982 (24) explain the ecological criteria that the proposed area has to fulfill. For example, the proposed area should possess high biodiversity of species of flora and fauna, having unique ecological characteristics as well as vulnerable to human-based activities. 7 Article 4.4.12 of Resolution A.982 (24) explain that the area to be designated as a PSSA should be an area of particular importance to utilisation of living marine resources. 8 Article 4.4.14 of Resolution A. 982 (24) stipulates that the proposed maritime area for PSSA designation should be an area which is of particular importance for the support of traditional subsistence and/or cultural needs of the local human population. 9 Articles 4.4.15 and 4.4.17 of Resolution A.982 (24) mentions that a maritime area should possess research and educational importance for it to be considered for a PSSA designation. 10 The Great Barrier Reef was identified as a PSSA through MEPC Resolution 44(30) and compulsory pilotage was introduced in the Great Barrier Reef through MEPC Resolution 45(30) (“List of MEPC Resolutions, 2009”).

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its objective of improved protection for the sensitive and pristine marine habitats of the Torres Strait region. 7.1. The proposed Straits of Malacca and Singapore PSSA The IMO is the only international body responsible for PSSA designation. A PSSA is an area that needs special protection through action by IMO because of its significance for recognised ecological or socio-economic or scientific reasons and which may be vulnerable to damage by international maritime activities (“Particularly Sensitive Sea Areas, 2002”). An application to IMO for designation of a PSSA and the adoption of APM or any amendment(s) to them, may be submitted only by a Member Government of the IMO (Revised Guidelines For the Identification and Designation of Particularly Sensitive Sea Areas, 2006). A co-ordinated proposal should be formulated where two or more Governments have a common interest in that particular area. Resolution A.982 (24) or its full name, Revised Guidelines for the Identification and Designation of PSSAs, states that: An application for PSSA designation should contain a proposal for an APM or measures aimed at preventing, reducing or eliminating the threat or identified vulnerability. APMs for PSSAs are limited to actions that are to be, or have been, approved and adopted by IMO, for example, a routeing system such as an area to be avoided. (emphasis added) As discussed earlier, the Straits of Malacca and Singapore are indubitably crucial for international shipping activities. These heavy shipping movements have increased the risks of maritime accidents which take place in the Straits every year resulting inter alia in oil and HNS spills, coastal soil erosion and low coral reef population development. There have been periodic calls for the Straits of Malacca and Singapore to be proposed as a PSSA, based on it fulfilling several, if not all criteria as a prerequisites as required in Resolution A.982 (24) (Malek, 2011, pp. 28e33). The Straits may fulfill the criteria needed in PSSA designation namely:

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off the coast of Dumai, Indonesia as listed in Table 4. The earlier discussions on Slimy and Evoikos incidents justify that the Straits are in fact vulnerable to impacts from international shipping activities. Any oil spill or HNS spills incidents would definitely affect the livelihood of the large coastal population of the littoral States of Malaysia, Indonesia and Singapore. As these waterways may potentially fulfill the criteria given in Resolution A. 982 (24), views have been expressed that the Strait of Malacca may be a logical candidate to be designated as a PSSA. Beckman argued that: It is very likely that the Malacca Strait as a whole would not qualify for designation as a PSSA, but only a particular clearly defined area of the strait which is in special need of protection (R. Beckman, 2004). In addition, Van Dyke stipulated: The Malacca Strait might be a logical candidate to be designated by the IMO as a particularly sensitive sea area because of the human and economic dependency on this Strait (Dyke et al., 2009, p. 193). In comparison with the Torres Strait, there are parallels with the Straits of Malacca and Singapore as both are waterways a number of navigational hazards, both are rich in the concentration of marine biodiversity and are important fishing grounds, both possess historical and cultural significance and most importantly, both are straits used for international navigation as defined in Part III of the LOSC (Rusli, 2011c). Nevertheless, in terms of traffic characteristics, the navigational traffic in the Straits of Malacca and Singapore is approximately 25 times higher than the Torres Strait. Congestion in the Straits has been identified as one of the causes of maritime accidents to take place. Therefore, if the Torres Strait could be designated as a PSSA, collectively, the Straits of Malacca and Singapore could also be a potential PSSA candidate. Assuming that both Straits of Malacca and Singapore are to be designated as a PSSA, there are a few APMs that might be potentially suitable for imposition.

(a) Ecological criteria [Articles 4.4.1e4.4.11 of Resolution A.982 (24)]; The coastal and marine environment of the Straits of Malacca and Singapore are habitats of many species of flora and fauna and these natural habitats possess high rate of natural biological production. The designations of Tanjung Piai as a RAMSAR site and Pulau Langkawi as one of UNESCO’s World GEOPARK further strengthen the argument that the Straits of Malacca and Singapore have rich ecological value and characteristics; (b) Social, cultural and economic criteria [Articles 4.4.12e4.4.14 of Resolution A.982 (24)]; As crucial economic lifelines for their coastal population, the Straits are important particularly in the fisheries as well as the tourism industries. Furthermore, two of the historic cities of the Strait of Malacca are now UNESCO World Heritage Sites, signifying that the Strait and its coastal areas possess significant historical value. (c) Vulnerability to impacts from international shipping activities [Article 5 of Resolution A. 982 (24)] Being the nearest route connecting the East and West, the Straits of Malacca and Singapore are accommodating heavy shipping activities as shown in Table 1. These highly congested Straits are prone to maritime accidents and to date, the biggest oil spill in the Strait of Malacca involved a spillage of 293,000 barrels of crude oil

7.1.1. Traffic limitations on the Straits of Malacca and Singapore An APM for possible implementation could be through limiting shipping traffic plying the Straits. Such a plan to cap shipping movement in the Straits was suggested by the Malaysian government in 2008 (Hock, 2008). Nevertheless, under customary and conventional international law, straits have always been deemed to be opened to maritime traffic. Even before the LOSC came into force, conventions and other agreements regarding straits contained provisions that ensured freedom of navigation for vessels transiting straits.11 The Montreux Convention (Convention Regarding the, 1936) (Montreux Convention) which governs navigation in the Turkish Straits, comprising the Dardanelles, the Sea of Marmora and the Bosphorus, has different provisions from other treatises and

11 Article 2 of Section 1 of the Montreux Convention 1936 that governs navigation in the Turkish Straits states that in time of peace, merchant vessels shall enjoy complete freedom of transit and navigation in the Straits regardless of their flags and the cargoes they are carrying (1936 Convention Regarding the Regime of the Straits, Adopted at Montreux, Switzerland on 20 July 1936, 1936, pp. 1e18) (‘Montreux Convention’); Article 7 of the Torres Strait Treaty ensures freedom of navigation and overflight over the Torres Strait (“Treaty Between Australia and the Independent State of Papua New Guinea Concerning Sovereignty and Maritime Boundaries in the Area Between the Two Countries, Including the Area Known as Torres Strait, and Related Matters, 1985”); Article V of the 1881 Boundary Treaty between Argentina and Chile confers freedom of navigation for vessels of all flags to sail through the Strait of Magellan (Morris and Mangone, 1989, pp. 205e206).

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conventions regarding straits. The Convention guarantees freedom of navigation to all ships to ply the Turkish Straits, however, it imposes some limitations and conditions on both merchant and naval vessels transiting the straits, depending on the prevailing political situation. Article 6 of the Montreux Convention provides: Should Turkey consider herself to be threatened with imminent danger of war, the provisions of Article 2 shall nevertheless continue to be applied except that vessels must enter the Straits by day and their transit must be effected by the route which shall, in each case be indicated by the Turkish authorities. (own emphasis) The Montreux Convention also imposes limitations on the aggregate tonnage of naval vessels that are transiting or are present in the Turkish Straits.12 Article 18(1) (a), (b) and (c) of the Montreux Convention further explains on the limitations on the aggregate tonnage of shipping which non-Black Sea Powers may have while being present in the Turkish Straits.13 Although customary international law and the LOSC dictate that straits shall always be open for navigation, the State practice disclosed in the Montreux Convention is a historical exception to this general rule. (Rusli, 2011b, pp. 39e48). The limitations prescribed by the Montreux Convention upon merchant vessels in Turkish Straits are only applicable in war and the limitations on average aggregate tonnage only apply to naval ships. This instance of divergent state practice shows that putting limitations or conditions on vessels transiting straits is not entirely unprecedented although rare. (Rusli, 2011e; pp. 122e130). Even though the Straits of Malacca and Singapore are not governed by a long standing international convention like the Turkish Straits, this may not preclude the littoral States from placing some limitations on ships transiting the straits for environmental protection purposes by other means. A potential justification for such limitations, which could be argued in a submission to the IMO, is that the Straits of Malacca and Singapore have only certain carrying capacity for shipping traffic (Rusli, 2010). If shipping traffic goes beyond certain limits, it may adversely impact the well being of the marine environment to the extent of causing irreparable damage.14 The reason why the Montreux Convention imposed limitations on shipping traffic in the Turkish Straits (depending on the prevailing political situation) was associated with Turkey’s security. Therefore, the reason for imposing such limitations in the case of the Straits of Malacca and Singapore would be so as to enable the littoral States to protect and preserve the integrity of the marine environment of the Straits from being degraded by heavy shipping activities. The PSSA Revised Guidelines provide that the APMs for PSSAs must be those that ‘are to be’ or ‘have been’ approved by the IMO such as routeing systems. A traffic limitation scheme could be

12 Article 14 of the Montreux Convention provides “The maximum aggregate tonnage of all foreign naval forces which may be in course of transit through the Straits shall not exceed 15,000 tons.”. 13 Article 18(1) of the Montreux Convention reads ‘The aggregate tonnage which non-Black Sea Powers may have in that sea in time of peace shall be limited as follows: (a) Except as provided in paragraph (b), the aggregate tonnage of the said Powers shall not exceed 30,000 tonnes; (b) If at any time the tonnage of the strongest fleet in the Black Sea shall exceed at least 10,000 tons the tonnage of the strongest fleet in that sea at the date of the signature of the present Convention, the aggregate tonnage of 30,000 tons mentioned in paragraph (a) shall be increased by the same amount, up to a maximum of 45,000 tons.; (c) The tonnage which any one non-Black Sea Power may have in the Black Sea shall be limited to two-thirds of the aggregate tonnage provided for in paragraphs (a) and (b)’. 14 ‘There may well be a tipping point, beyond which any further increase would be too costly and hazardous.there is a limit to the carrying capacity of the straits’ (H. M Ibrahim, 2008, 25 November).

characterised as a routeing system in that it helps to regulate traffic especially in the narrow, busy and constricted waters of the Straits of Malacca and Singapore. Undoubtedly if traffic limitations were proposed as an APM in a submission made to the IMO on designation of the Straits of Malacca and Singapore as a PSSA, member States would question the import and content of this measure as well as its legality (Rusli, 2011e, p.125). Would it involve only certain types of vessels such as giant mega tankers? What would be the maximum limit on shipping movements through the straits daily, monthly or even yearly? Who would have the authority to decide on the maximum volume of shipping traffic that can traverse the Straits? Does the limitation relate to the maximum gross tonnage of vessels? If so what is the maximum gross tonnage per ship per day allowed to traverse the Straits? Would a vessel be penalised if it violated the limitation regulations? Maritime States are likely to argue that such a measure would be inconsistent with the LOSC, particularly Articles 38(1) and 44. They may also contend that this proposed APM would create an undesirable precedent which could be followed by other States bordering straits in other parts of the world. In addition, it may be argued that this proposed APM would cause undue delays in maritime shipments and unwarrantedly disrupt the free flow of international trade, as there would be quotas as to the amount of shipping traffic that could transit the Straits at any one time. A study has estimated that the cost of rerouting tankers to Japan away from the Straits of Malacca and Singapore route would increase the cost of doing business by US$88 million (J. H. Ho, 2009b, pp. 233e234). Certainly it could be anticipated that this form of APM would not be favoured by major maritime States that depend on the Straits for the survival of their economies. Putting these potential oppositions aside, in relation to implementation of such a measure, discussions could be convened between the littoral States, user States, private stakeholders and the IMO in order to determine the best method of limiting shipping traffic so as to protect the marine environment of the Straits without causing substantial disruption to global trade. Further research would also be needed into the sustainable traffic carrying capacity of the Straits, taking into consideration the biodiversity, socio-economic and scientific importance of the Straits. A preliminary study conducted by the Maritime and Port Authority of Singapore (MPA) released in November 2009 revealed that the Strait of Malacca can sustain traffic up to five times the current level (Hong, 2010, pp. 5e6). It also noted that the Strait of Singapore could safely accommodate a doubling or more of vessel traffic in the future, up to an increase of 75% without needing any changes to its infrastructures or operations (“Working Paper For Carriage Capacity of the Straits of Malacca and Singapore, 2009”). The study pointed out that in 2007, there were 257, 000 vessel movements in the Strait of Singapore based on actual vessel reports to the Vessel Traffic Services (VTS) in Singapore (SoMS Study: Preliminary findings show capacity to handle traffic growth in the Singapore Strait, 2009). Furthermore, the study indicated that the number of accidents and collisions in the Strait of Singapore has, over the period of three years since 2006, remained constant despite the steady increase in shipping traffic, manifesting that the increase in traffic volume may not directly affect the safety of navigation of shipping activities in the Strait of Singapore. The second phase of this study by the MPA will venture into possible traffic management measures to ensure smooth and safe navigation in the Strait of Singapore is guaranteed. The results of the second part of the study have yet to be revealed as research is still ongoing. In contrast, a similar study conducted by Maritime Institute of Malaysia (MIMA) claimed that the maximum carrying capacity of the Strait of Malacca is 122, 640 vessels which was predicted to

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provides that States have an overarching obligation to protect and preserve the marine environment.16 Further research has to be undertaken to ascertain the sustainable limit of shipping in the Straits. If shipping traffic is not capped and it goes beyond the carrying capacity of the Strait, the marine environment of these waterways will ultimately suffer from undesirable consequences (H. Ibrahim and Shahryari, 2008, pp. 15e16).

Fig. 2. The concept of safe distance and separation. (Source: Drawn after Shahryari and Mohamad, 2011).

happen as soon as 2024 (H. Ibrahim and Sh, 2009). This study by MIMA applied queuing theory as a methodology and projected carrying capacity based on traffic data generated by the STRAITREP system. MIMA has also conducted another research on carrying capacity by looking from the perspective of domains or the areas generated around a vessel (Shahryari and Mohamed, 2011, pp. 4e11). As the domains of ships decrease, the carrying capacity of a waterway or strait would increase and vice versa. As shown in Fig. 2, larger domains would reduce the risk of the occurrence of maritime accidents. A safe distance ranging from 2 to 0.2 nautical miles and safe separation ranging from 5 to 0.5 nautical miles are recommended by shippers and mariners in establishing a safe domain of a ship Figs. 1 and 2. Using the domain of a safe separation of 5 nautical miles and a safe distance of 2 nautical miles as the benchmark, it is said that the Strait of Malacca would be able to accommodate up to 119, 159 vessel movements that would be reached soon by the year 2020 (“Singapore Strait can handle 75% growth in traffic, 2009”). Similarly, a study in 2007 conducted by the Japan Ministry of Land, Infrastructure and Transport in conjunction with the Nippon Foundation projected the Straits of Malacca and Singapore will accommodate more shipping traffic in the future, with a projected volume of 141, 000 vessel transits annually by 2020 (J. Ho, 2009, pp. 241e242). Although these three separate studies differ in their methodologies and conclusions as to the precise carrying capacity of the Straits, the general agreement derived from these studies is that the problems of traffic congestion in the Straits would be inevitable. If shipping traffic is not kept to its sustainable limit, a normal voyage through the Straits of Malacca and Singapore would obviously be longer than usual and congestion may thereafter complicate safe navigation.15 In advancing their submission in the IMO, the littoral States could contend that the proposed traffic limitation is critical to enhancing navigational safety by ensuring that the traffic in the straits does not escalate to such a degree that it causes danger to mariners (Rusli, 2011d). They could also contend that this protective measure does not contravene the LOSC as the Convention

15 The research conducted by the MPA on carriage capacity of the Straits of Malacca and Singapore revealed that when traffic reaches 140,000 transits per year (twice the amount the Straits are accommodating at present), the travel time through the Strait of Singapore will increase by 13 per cent, from a 7-h transit to nearly 8 h (Hong, 2010, pp. 5e6).

7.1.2. The proposed cost-recovery mechanism in the Straits of Malacca and Singapore The idea of toll imposition in the Straits of Malacca and Singapore goes back to 1972 but has never been implemented.17 After the dramatic increase of marine casualties in 1992, this idea was again mooted to reduce the risks of collisions in the Straits of Malacca and Singapore (Purwaka, 1998, pp. 457e358). Toll levying of vessels transiting the Straits raises questions of inconsistency with LOSC provisions. Article 26(1) of the LOSC prescribes that coastal States should not levy foreign ships that are merely passing through their territorial Sea.18 States bordering straits are primarily responsible for maintaining safety of navigation facilities in the Straits no matter how busy the traffic is.19 As one of the States bordering the Dover Strait, a strait possessing a reputation as the busiest global choke point, the United Kingdom (UK) submitted an information paper to the IMO entitled ‘Developing Principles for Charging Users the Cost of Maritime Infrastructure’(Anderson, 1999, pp. 434e455). This was based on the fact that the increasing cost of navigational aids and facilities would eventually be a burden on the coastal State. In order to foster a more equitable situation, the UK suggested that the IMO should develop some fair principles to govern the establishment of a nondiscriminatory charging system.20 This would be a non-profitable regime where ships are charged to gain funds for recovery of costs, capital investment and improvements. This regime was designed to reduce the burden on coastal States, especially in busy waterways like the Dover Strait and the Straits of Malacca and Singapore of maintaining the aids to navigation facilities. Due to the complex legal issues associated with this proposition particularly on the concept of unimpeded transit passage rights through straits,

16 Article 192 of the LOSC reads ‘States have the obligation to protect and preserve the marine environment’. 17 The user States, in this context were viewed as ‘free riders’, and thus, Malaysia suggested that a Malaysia-Indonesia corporation be set up to levy tolls on ships plying the Straits. Singapore and the user States, on the other hand, were not in favour of the idea (KL, 1982, p.61). 18 The coastal State can only levy them for ‘specific services’. It has been generally accepted that ‘specific services’ refers to pilotage, towing and escorting services, because these services relate to ensuring the success of transiting vessels’ voyages (Dyke et al., 2009, p. 192). 19 Article 44 of the LOSC reads ‘States bordering straits shall not hamper transit passage and shall give appropriate publicity to any danger to navigation or overflight within or over the strait of which they have knowledge’. 20 In 1997 and 1998, the British Delegation to the IMO’s Legal Committee submitted notes in support of a proposal that the IMO should develop principles for charging users the cost of maritime infrastructure. As a State that borders the Strait of Dover, the world’s busiest strait, the UK noted that the maintenance costs to keep critical straits open for navigation could overstretch the ability of particular States bordering straits to provide such services. The UK then proposed that the IMO should develop a cost-recovery regime which would encourage the establishment of future charging system. This system should be based on four principles. Firstly, the system must be consistent with the LOSC and must preserve the right of innocent passage. Secondly, the system must not discriminate among vessels of different member States participating in the scheme and thirdly that the charges should be clearly related to the cost of providing the services per se. It should not amount to overcharging or indirect taxation of transiting shipping. Fourthly, the system should ensure that the services charged for are at a level consistent with the standards laid down by the IMO or international agreement (Tiwari, 1999, pp. 472e474).

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no further action was taken on the UK’s proposal (Nandan, 1999, pp. 27e28). There have also been periodic calls to attract more parties to participate in co-managing the Straits of Malacca and Singapore, however the support given, especially by private sector companies and other stakeholders, has been disappointing (Bateman, 2009, pp. 47e48). Differences have arisen between prospective donor States and the littoral States over project funding, and shipowners have shown hesitation in contributing to the Aids to Navigation Fund (Rusli, 2011a, pp. 501e526). Although ships calling at ports along the Straits of Malacca and Singapore pay port dues and part of these dues have been used to maintain aids to navigation in the Straits, more than half of the transiting ships do not call at these local ports and hence are considered free riders, taking advantage of the existing aids to navigation facilities primarily provided and funded by the littoral States (J. H. Ho, 2009, pp. 240e243). Therefore, to ensure more effective co-operation and participation from user States and stakeholders in the Straits of Malacca and Singapore, a system of a cost-recovery mechanism could be a potential APM proposed by the littoral States. If the littoral States of the Straits of Malacca and Singapore were able to impose this on ships transiting the Straits, the revenue collected could be used to improve and to establish more aids to navigation facilities and infrastructure along the length of the Straits. Denmark used to impose charges on ships plying the Danish Straits, which comprise three channels connecting the North and Baltic Seas through the Kattegat and Skagerrak (Elferink, p. 2). No foreign trading ships could pass through the Danish Straits without paying the transit dues.21 Nevertheless, beginning 1857, the payment of Sound Dues was discontinued.22 In exchange for transit rights for vessels of these States, Denmark received an indemnity corresponding to an annual income capitalised to the current value from the signatory States (Alexandersson and Mangone, 1982, pp. 73e75).

21 Due to the busy nature of the waterways, Denmark gained substantial revenue from the toll collection so much so that at one time, it contributed a third of Denmark’s wealth. Transit dues were collected directly at Helsingør, the narrowest point of the Straits and the amount of toll incurred was based on the cargoes that the vessels were carrying. The increased trade through the Danish Straits brought uneasiness among European maritime States that felt burdened with the toll imposed upon them. These States opposed the toll and thought it should be abolished altogether (Kagami, 2008, p. 47). 22 The toll collection in the Danish Straits was abolished through the adoption of three treaties. The first treaty was concluded by Denmark and a number of countries of Western Europe. (“Treaty for the Redemption of Sound Dues between Austria, Belgium, France, Great Britain, Hanover, the Hanse Towns, MecklenburgSchwerin, the Netherlands, Oldensburg, Prussia, Russia, Sweden-Norway and Denmark, 1969, p. 357”); Denmark also entered another treaty with Great Britain on the same matter. Article 2 of the Convention between Denmark and Great Britain to Complete the Arrangements for the Redemption of the Sound Dues (Copenhagen Convention) states that Great Britain was to pay the sum of £1,125,206 to the King of Denmark, and in return for that, Article 3 of the Copenhagen Convention conferred freedom of navigation for British ships to pass the Danish Straits (“Convention between Denmark and Great Britain to Complete the Arrangements for the Redemption of the Sound Dues Signed at Copenhagen et al. , 1969, pp. 347e348”). In the same year, Denmark made an agreement with the American government allowing American ships to pass freely in perpetuity through the Danish Straits. Article 1 of the Convention for the Discontinuance of the Sound Dues between Denmark and the American government signed at Washington, 11 April 1857 (Washington Convention) confers freedom upon American ships to sail through Danish Straits. As agreed in Article 2 of the Washington Convention, Denmark would maintain aids to navigation in the Straits without having to charge tolls upon American ships. In return for this, the American government agreed to pay Denmark a hefty amount of money, as enumerated in Article 3 of the Washington Convention, a lump sum payment of compensation amounting to US$393 million (“Convention for the Discontinuance of the Sound Dues between Denmark and the United States signed at Washington et al., 1969, pp. 465e466”).

This previous practice by Denmark shows that the toll regime imposed upon navigating vessels is not something which is entirely unprecedented although it is now over 150 years since it was discontinued and it has not been replicated in any other part of the world. The willingness of the maritime powers at that time to pay hefty compensation to Denmark in return for free navigation represented an acknowledgement of the rights of a coastal State to impose a toll, however wide acceptance by States of relevant provisions of the LOSC such as Articles 26(1), 38(1) and 44 would generally be considered as overriding that earlier acknowledgement. There are a number of obstacles to introducing a cost-recovery mechanism in the Straits of Malacca and Singapore. Firstly, this mechanism is inconsistent with the exercise of unimpeded transit passage as provided for in Articles 38(1) and 44 of the LOSC. Maritime nations such as the U.S. would undoubtedly oppose this proposal as the U.S. has always been vigorous in airing its opposition to toll-type charges in the Straits of Malacca and Singapore (Khalid, 2006). During the ‘The 2006 Kuala Lumpur Meeting on the Straits of Malacca and Singapore: Enhancing Safety, Security and Environmental Protection’ (Kuala Lumpur Meeting), the U.S., together with representatives of the shipping industry at the meeting invoked the application of Article 38 of the LOSC to ensure that the shipping of goods, raw material and energy remained unimpeded and maintained that they were ready to oppose any attempt for the imposition of compulsory toll charges in the Straits of Malacca and Singapore (J. H. Ho, 2009, pp. 238e242). A year later, during the ‘The 2007 Singapore Meeting on the Straits of Malacca and Singapore: Enhancing Safety, Security and Environmental Protection’ (Singapore Meeting), the U.S. expressed concerns about the possible imposition of compulsory tolls via the Co-operative Mechanism and was happy that the idea of toll implementation was not discussed in the Co-operative Mechanism’s agenda. Secondly, a further practical concern is that unless some prepaid electronic form of payment is devised, this mechanism may create long queues for ships passing through the Straits of Malacca and Singapore, causing undue delays in the voyage of vessels which would ultimately result in economic losses for many companies that rely on shipping to regulate their trading activities (George, 2008, pp. 57e60). As a result, the littoral States may be liable to pay compensation for the economic losses suffered by such ships and their crew, the cargo importers and perhaps even the consumer of the goods. Thirdly, in terms of political implications, this cost-recovery mechanism is likely to be challenged by many maritime States and those dependent on global imports and exports as it would create an undesirable precedent for such an imposition elsewhere on global shipping routes. Fourthly, it would be difficult to devise the criteria for determining the payment under this proposed cost-recovery mechanism, in particular, whether it should be based on the size of the ship, the cargo it is carrying or the potential of the vessel to pollute the seas. The littoral States may counter argue that the cost-recovery mechanism is not contrary to the right of transit passage through Straits. This mechanism would actually facilitate shipping as navigation through the Straits would be safer for international maritime traffic with installation of state of the art aids to navigation. Such an imposition would not generate extra and excessive income for the littoral States as the money would be used to fund the maintenance of the Straits. In addition a cost-recovery mechanism would not necessarily create an undesirable precedent for other littoral States to follow because each strait has different characteristics. Such a mechanism would only be imposed in a strait that is heavily

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burdened with high navigational traffic which has reached a level so detrimental to the integrity of its marine environment that drastic measures have to be taken. The method of payment under the cost-recovery mechanism could be discussed and deliberated between the littoral States, the Users, the IMO and other stakeholders in order to determine the most viable procedures so that these would neither impair nor hamper smooth navigation and would not unreasonably affect shipping costs. A possible way forward is to integrate such payments into the IMO Straits Trust Fund or the Aids to Navigation Fund introduced in the Kuala Lumpur Meeting in 2006 and to establish a special Committee comprising the littoral States, the IMO and the Users to manage such a Fund. This would not involve the Revolving Fund established by the Malacca Strait Council (MSC) as this is a separate co-operation between the littoral States and Japan. It is more feasible and acceptable that such a Fund to be internationally managed to ensure accountability, transparency and to avoid corruption. As Malaysia, Indonesia and Singapore are littoral States that possess sovereignty over the Straits, it would also be appropriate that the Committee be chaired by these States. Presently, it is estimated that more than 4.0 billion DWT of ships transit the Straits annually (Mandryk, 2008). If every transiting ship contributed only one cent per DWT to the Fund, it would generate approximately US$40 million to the Fund (Basiron, 2007, pp. 33e35). The monetary amount to be contributed is negligible so much so that it would not even impact freight rates (Hamzah, 2008, pp. 77e78). Therefore, it could be proposed that under this scheme, payment is made directly to the Fund with the users required to pay one cent per DWT to the Fund. This would be a non-discriminatory regime; the more usage, the more payment would be imposed. In fact, this kind of a co-operation, to a certain extent, is supported by the LOSC itself.23 Having said this, this proposed cost-recovery mechanism would have the potential to realise the creation of a more effective cooperative burden sharing mechanism that the littoral States, the user States and the IMO have been working towards for some time. 7.1.3. The proposed compulsory pilotage in the Straits of Malacca and Singapore Currently, pilotage services are available and offered by major ports along the Straits of Malacca and Singapore. Pilotage is made compulsory when ships are leaving and entering port limits. But

23 There are a number of provisions in the LOSC that promotes co-operation between States to protect and preserve the marine environment. Article 43 is a provision that is directly related to straits used for international navigation where it promotes and encourages States bordering straits to cooperate with user States in protecting and preserving the marine environment of straits that form global international maritime chokepoints. Article 194 of the LOSC reads ‘States shall take, individually or jointly as appropriate, all measures consistent with this Convention that are necessary to prevent, reduce and control pollution of the marine environment from any source, using for this purpose the best practicable means at their disposal and in accordance with their capabilities, and they shall endeavour to harmonise their policies in this connection’. In addition, Article 197 of the LOSC stipulates that ‘States shall cooperate on a global basis and, as appropriate, on a regional basis, directly or through competent international organisations, in formulating and elaborating international rules, standards and recommended practices and procedures consistent with this Convention, for the protection and preservation of the marine environment, taking into account characteristic regional features’. Both Articles 194 and 197 of the LOSC employ the word ‘shall’, which may indicate an obligation, in their provisions. While this may be true, nevertheless, the word ‘shall’ in treaty language is indicative of a duty to cooperate under international law but the duty to cooperate has often been interpreted under international law as firstly, requiring negotiations in good faith between States before any obligations on environmental measures are carried out. (Oxman, 1998, pp. 408e426); (Nordquist, 1991, pp. 36e40).

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pilotage has never been made compulsory for ships navigating the Straits. Nevertheless, since 1977, vessels are recommended to take on a pilot when navigating through critical areas within the Straits (Leifer, 1978). Due to fear of future casualties, there have been suggestions to intensify the usage of a pilotage system in the Straits of Malacca and Singapore. The pilotage issue was discussed at the IMO Singapore Meeting on the Straits of Malacca and Singapore in 2007 (Wilkins, 2007). During the meeting, consideration was given to establishing a Pilotage User Group (PUG) for the Straits of Malacca and Singapore. Such a Group has been established in other parts of the world. For example, a PUG was formed in Denmark with the aim to find ways of further enhancing the safety of navigation through the entrances to the Baltic Sea (“Danish Pilotage User Group-Update et al., 2007”). The Danish PUG attempts to create an open transparent dialogue between pilotage service providers and users, in order to ensure optimal pilotage services in general and to encourage the use of pilots for ships navigating through the entrances to the Baltic Sea. The issue of pilotage came into the limelight again at the 2008 International Symposium of Safety and Protection of the Marine Environment in the Straits of Malacca and Singapore (the Symposium) in Kuala Lumpur (Djalal, 2008). Issues relating to a pilotage system in the Straits of Malacca and Singapore were raised, including: (a) whether it would be compulsory or voluntary; (b) whether it would be employed in the TSS; and (c) whether it would be limited to port entry only. These issues were again discussed during the 33rd TTEG meeting in Kuching, Malaysia in October 2008, and were further discussed at the subsequent TTEG meetings in Singapore and Yogyakarta in 2009 and 2010 respectively. During the 34th TTEG meeting in Singapore in 2009, the littoral States have agreed on the proposed application of voluntary pilotage services (VPS) for vessels navigating the Straits of Malacca and Singapore. The littoral States have also decided to prepare the draft revised guidelines for the VPS that would later be circulated among the littoral States and the IMO for comments and amendments. Malaysia had circulated the revised guidelines in November 2009 (The 35th Meeting of the Tripartite Technical Experts Group on Safety of Navigation in the Straits of Malacca and Singapore et al., 2010). In the 35th TTEG meeting in Yogyakarta, Indonesia, the issue pertaining to voluntary pilotage was discussed and Indonesia pointed out that due to the increasing number of vessels transiting the Straits every year, there is a need to synchronise the standard guidelines to the existing littoral States’ references on the qualifications of Straits Pilot to ensure sustainable implementation of this regime in the future. It was also agreed in the 35th TTEG meeting that more time be given to finalise the revised guidelines for the application of voluntary pilotage and a joint paper on this will be drafted and sent to the IMO after the littoral States have reached an agreement on the revised guidelines (The 35th Tripartite Technical Experts Group () Meeting on the Safety of Navigation in the Straits of Malacca and Singapore: Report of the Meeting et al., 2010). As the proposed VPS is not compulsory, it may be implemented outside the regime of the PSSA. Nevertheless, given that the littoral States are now developing a VPS scheme and that the Straits will be more congested, making them more navigationally difficult in the future, it may not be entirely impossible for the littoral States of Malaysia, Singapore and Indonesia to follow in the footsteps of Australia and PNG to impose compulsory pilotage system in the Straits of Malacca and Singapore. It is therefore crucial to examine

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the potential legal and political implications that may arise out of such an implementation. 7.1.3.1. Potential political and legal implications. The Straits of Malacca and Singapore are waterways of environmental significance and are rich in biodiversity (H.M (Ibrahim, 2008, 25 November). With the steady increase in shipping traffic these waterways are facing in years to come, the marine environment of these Straits will be in jeopardy if no additional protective measures are taken (Rusli, 2011e). Should Malaysia, Indonesia and Singapore, as the three littoral States of the Straits of Malacca and Singapore agree to submit a PSSA proposal to the IMO, as required by Resolution A.982 (24), the submission is likely to contain proposed measures for the application of compulsory pilotage, which in this case, is the suggested APM for the Straits. This APM would fulfill the requirement of Resolution A.982 (24) as it is an APM that has been previously approved by the IMO in its application in the Torres Strait PSSA. Prior to submission of such a proposal, it would also be prudent to carry out a preliminary study on the feasibility of the application of compulsory pilotage in the Straits of Malacca and Singapore. When submitted to the IMO, this application is likely to be submitted to three committees in IMO e the MEPC, the Legal Committee and the Sub-Committee on Safety of Navigation (NAV Sub-Committee) of the Maritime Safety Committee (MSC) (R. C. Beckman, 2007). These Committees will review, evaluate and assess the proposed APM on its legality under LOSC, the practicability and feasibility of its application and whether or not it would assist the littoral States to protect and preserve the marine environment of their maritime space. If the application is successful, the MEPC would then issue a Resolution recommending the application of the proposed APM in the maritime area that has been designated as a PSSA. Based on the Australian experience with the Torres Strait, the MEPC would only recommend the APM without stating whether it is mandatory or otherwise. As contended by Bateman: .it is not in the nature of the IMO to formally approve traffic management schemes but rather to recommend their acceptance (Bateman et al., 2009, p. 276). Theoretically, based on these facts, it is likely that the Straits of Malacca and Singapore could be designated as a PSSA or a number of PSSAs however the application of the proposed APM particularly a compulsory pilotage scheme is likely to be contentious. There would be many controversial legal and political implications associated with such an application. Singapore and the United States of America (U.S.) were among the States that clearly protested against Australia’s implementation of compulsory pilotage in the Torres Strait, contending that it undermined the transit passage regime under the LOSC and was inconsistent with the decisions reached in the IMO (Seng, 2006). Singapore has indicated its intention to bring Australia to international dispute resolution over this issue but this has not occurred yet (Bateman and White, 2009, pp. 184e203). The fundamental position taken by Singapore is that it is against any acts that could jeopardise, hamper or impede freedom of navigation. Based on Singapore’s articulated position in relation to the issue of compulsory pilotage in the Torres Strait, though Singapore may probably agree that both Straits of Malacca and Singapore could be designated as a PSSA, it nevertheless is likely to protest against the compulsory pilotage regime as the proposed APM. If the Straits of Malacca and Singapore are treated separately and not as one waterway, then the scenario may be different. As far as the Strait of Malacca is concerned, both Malaysia and Indonesia are littoral States of the Strait. Both countries were steadfast in declaring that the Straits of Malacca and Singapore are

straits which are significant for international navigation and not international straits while Singapore merely acknowledged this in the 1971 Joint Statement (1971 Statement)24 without articulating its own view on the issue (Djalal, 2004). This was because these countries had different national interests; Malaysia and Indonesia at that time were more focused on the issue of sovereignty while Singapore, as a bustling international port, was more focused on ensuring freedom of navigation for merchant vessels. With the conclusion of the Third United Nations Law of the Sea Conference (UNCLOS III) and the adoption of the LOSC in 1982, Malaysia, Singapore and Indonesia ultimately agreed with the provisions on transit passage for all vessels in straits used for international navigation in Part III of the LOSC. Nevertheless, as a condition for its acceptance and ratification of the LOSC, Malaysia proposed Article 23325 as a guarantee that the marine environment of such straits could still be protected and safeguarded despite having responsibilities to accommodate free navigation to all vessels (Nordquist, 1991). Because of this, many regard Article 233 as Malaysia’s brainchild (George, 2008). In recent times, Malaysia, Indonesia and Singapore have continued to articulate their positions on environmental issues relating to the Strait of Malacca and Singapore.26 Singapore is more focused on providing better aids to navigational infrastructures to promote safer shipping for transiting vessels. As an entrepot State, liberal navigational regimes such as transit passage are imperative to Singapore’s economic interest and survival (R. Beckman, 2006). Malaysia and Indonesia, on the other hand, apart from acknowledging the importance of safe navigation, have also made other calls which to a certain extent may place constraints on navigation through the Straits of Malacca in the interests of environmental protection. These include imposing tolls on navigating ships (Purwaka, 1998, pp. 515e518), capping the number of vessels transiting the Strait (H. Ibrahim and Shahryari, 2008, pp. 15e16) and also proposals for the application of pilotage (Djalal, 2008). Based on these facts, it is clear that Malaysia and Indonesia, as compared to Singapore, have a lengthy history of seeking measures

24 The 1971 Joint Statement reads (i) the three Governments agreed that safety of navigation in the Straits of Malacca and Singapore is the responsibility of the coastal States concerned; (ii) the three Governments agreed on the need for tripartite cooperation on the safety of navigation in the two straits; (iii) the three Governments agreed that a body for co-operation to co-ordinate efforts for the safety of navigation in the Straits of Malacca and Singapore be established as soon as possible and that such body should be composed of only the three coastal States concerned; (iv) the three Governments also agreed that the problem of the safety of navigation and the question of internationalisation of the straits are two separate issues; (v) the Governments of the Republic of Indonesia and of Malaysia agreed that the Straits of Malacca and Singapore are not international straits, while fully recognising their use for international shipping in accordance with the principle of innocent passage, The Government of Singapore takes note of the position of the Governments of the Republic of Indonesia and of Malaysia on this point; (vi) on the basis of this understanding, the three Governments approved the continuation of the hydrographic survey (Joint Statement of the Governments of Indonesia and Malaysia and Singapore, 1971). 25 Article 233 of the LOSC states ‘.if a foreign ship.has committed a violation of the laws and regulations referred to in Article 42, paragraph 1(a) and (b), causing or threatening major damage to the marine environment of the straits, the States bordering the straits may take appropriate enforcement measures and if so shall respect mutatis mutandis the provisions of this section’. 26 In the Singapore Statement on Enhancement of Safety, Security and Environmental Protection in the Straits of Malacca and Singapore in 2007, Singapore expressed its concern over the protection and preservation of the marine environment of the Straits of Malacca and Singapore but at the same time acknowledged that navigation through the Straits cannot be hampered. Singapore, together with Malaysia and Indonesia agree to enhance the existing cooperative mechanism to further protect and preserve the marine environment of the Straits and to promote safe navigation for navigating vessels. (Singapore Statement on Enhancement of Safety, Security and Environmental Protection in the Straits of Malacca and Singapore, 2007).

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to protect and preserve the marine environment of the Straits, notwithstanding the fact that such attempts may indirectly constrain passage rights. It is true that the littoral States have in the 1971 Statement agreed to treat the two Straits as a single strait. In fact, until today, co-operation between the littoral States, the users and the IMO have worked out based on this agreement.27 Nevertheless, the 1971 Statement was never meant to be a treaty but it was a joint statement of agreement made by the littoral States at the time when the density of shipping traffic was not as high as it is now. It has now been forty years since the 1971 Statement was made and considering the fact that the number of shipping traffic is going to increase, it may not be legally unfeasible to amend the agreement to the 1971 Statement in treating both Straits as separate straits as far as PSSA designation is concerned. If the fifth Statement (see Note 24) on the application of innocent passage in the Straits of Malacca and Singapore could be changed and replaced with the transit passage regime when the LOSC came into force, the general agreement that the Straits are to be treated as a single strait could also be changed under the pretext of the proposed PSSA designation. Furthermore, the International Hydrographic Organization (IHO) itself defines both the Straits of Malacca and Singapore as two separate straits and hydrographically, they were never regarded as one single strait. (Limits of Oceans and Seas, 1953). Taking into account the likelihood that Singapore may refuse to apply for the designation of the Strait of Singapore as a PSSA, Malaysia and Indonesia could themselves submit proposals to the IMO with a view of designating the Strait of Malacca as a PSSA with compulsory pilotage as a proposed APM. As with the Torres Strait, where compulsory pilotage only applies in the most critical area of the waterway, Malaysia and Indonesia could also suggest and propose the application of pilotage in the busiest and navigationally difficult parts of the Strait, particularly between One Fathom Bank and Tanjung Piai. The type and size of vessels that are subjected to the compulsory pilotage regime could also be defined in the PSSA proposal to the IMO. Both countries could justify the imposition of compulsory pilotage based on the grounds earlier explained in Heading 5. Assuming that the IMO accepts the proposal, Malaysia and Indonesia could also consider, following Australia’s domestic initiative of imposing penalties on any ships that failed to engage a pilot while transiting the Straits should they in the future enter either Malaysian or Indonesian ports rather than obstructing the ship’s passage as it transits the Strait. In view of the critical nature of the Straits of Malacca and the volume of shipping traffic passing through it, there is likely to be considerable controversy over the proposed plan to introduce compulsory pilotage in the Strait. Firstly, nations that are against such a plan would contend that Malaysia and Indonesia have breached the provisions of the LOSC which allows for the liberal navigational regime of transit passage in straits used for international navigation. Opposing States may argue that Malaysia and Indonesia have violated Articles 38(1) and 44 of the LOSC that prohibit littoral States from hampering transit passage. Secondly, they would assert that since the Strait of Malacca is indispensible in regulating global trade, the imposition of compulsory pilotage would not only impede passage, but it would also unreasonably increase shipping costs, as vessels and ships would have to employ pilots while transiting the Strait. It could be argued that increases in the cost of shipping would adversely affect the world’s economy. The following Table 7 shows the average operating costs of a VLCC:

27 For example, the TTEG on safety of navigation and control of pollution in the Straits of Malacca and Singapore which was established in 1975 was a product of the 1971 Statement (Theng, 1998, pp. 254e268).

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Table 7 VLCC operating costs based on a vessel with a capital cost of US$68 million and a life of 25 years. Elements

Running cost (US$)

Manning, including victualling 892,000.00 Lubes and stores 386,000.00 Spares, R & M 263,000.00 Drydocking (annualised cost) 688,000.00 Insurance 582,000.00 Administration 110,000.00 Miscellaneous 65,000.00 Total 2,986,000.00 Running costs per annum ¼ US$2,986,000.00 Capital costs per annum ¼ US$4,825,000.00 (Calculated on a 5% rate of return over 25 years on an initial cost of US$68 million) Total operating cost per annum ¼ US$7,811,000.00 (Marlow and Gardner, 2006).

Although a proper study has yet to be conducted to determine the impacts of the introduction of compulsory pilotage in the Straits of Malacca and Singapore on freight rates, data from Table 7 shows that such an application would incur more expenses on the average operating costs of a VLCC and this would ultimately affect the global international trade that moves via the Straits. Thirdly, from a practical perspective, could Malaysia and Indonesia provide a guarantee that the number of pilots would be sufficient for the Strait of Malacca which accommodates almost 75,000 ship transits per year? These vessels could not expect their voyage to be impeded just because pilots could not be made available; this would clearly go against the spirit of the LOSC. Fourthly, in justifying its act to validate the usage of compulsory pilotage in the Torres Strait, Australia argued that no other strait routinely used in the world has a long history of pilotage like the Torres Strait does. The Strait of Malacca on the other hand does not possess a long history of pilotage as it was only being considered as a potential ships routeing and safety measures in 1977 (Leifer, 1978, p. 205). Therefore user States may assert that compulsory pilotage should neither be introduced nor imposed on ships that transit the Strait of Malacca. Fifthly, cooperative mechanisms in both the Straits of Malacca and Singapore are doing well with more States other than Japan agreeing to share the burden of protecting and preserving the marine environment of both Straits. At the 2006 Kuala Lumpur IMO Meeting, China and the U.S. expressed interest in participating in projects related to environmental protection and safety of navigation matters in the Straits. At the 2007 IMO Meeting in Singapore, South Korea and the UAE announced that they would contribute to the fund. Germany revealed its intention to find ways to contribute to the management of the marine environment of the Straits (R. Beckman et al., 2009). In addition, since 2010, China and India have also contributed by undertaking hydrographic works in removing wrecks that may complicate navigation in the TSS area within the Straits (Subramaniam and Ahlawat, 2010). These developments show that as far as the Straits of Malacca and Singapore are concerned, compulsory pilotage is likely to face political opposition and may not be the ultimate solution to the littoral States environmental protection dilemma. 7.1.3.2. Possible rebuttals by the littoral states. Malaysia and Indonesia are, however, not lacking in arguments to rebut these potential criticisms and opposition to the compulsory pilotage plan. On the first issue, both States may assert that the imposition of compulsory pilotage in the Strait of Malacca would not impede transit passage, but on the other hand would facilitate safe and environmentally responsible passage of the Straits. For narrow parts of the Strait that are burdened with high navigational traffic, compulsory pilotage would be needed in order to prevent future

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mishaps and casualties. Taking the Torres Strait example, there are parallels with some parts of the Strait of Malacca as both are waterways with many navigational hazards. It is a true assertion that cooperative mechanisms between the littoral States and the Users have gone through positive developments in since 2008. Nevertheless, these developments have been moving rather slowly and they have not kept pace with the increasing number of ships that sail the Straits of Malacca and Singapore each year, as far as contributions made to the Fund are concerned. The result of the assessment survey of the critical aids to navigation in the Straits conducted in 2008 revealed that the annual average cost of replacement and maintaining the aids to navigation is about USD5.5 million (Report of 4th Aids to Navigation By Malaysia: Update on the Aids to Navigation Fund Under the Cooperative Mechanism Between the Littoral States on Safety of Navigation and Environmental Protection in the Straits of Malacca and Singapore, 2010). In 2009, as enumerated in Table 6, only USD5 million was raised and the amount raised was even lower in both 2010 and 2011. In some instances, the littoral States have had to bear the costs of maintenance themselves. With less funds being collected every year, it will be difficult for the littoral States to ensure that aids to navigation facilities installed along the Straits are well maintained and functioning accordingly. Therefore, the Cooperative Mechanism could not entirely be relied upon and consequently, compulsory pilotage, given its success in the Torres Strait, may be seen by the littoral States particularly Malaysia and Indonesia as a potential solution to further preserve and protect the marine environment of the Strait of Malacca by reducing the risks of maritime accidents. There is relatively little doubt that efficient pilotage services would help to increase safety of passage. In a study conducted on pilotage, only around 18% responded with the opinion that pilotage would not make much of a difference in contributing to the improvement of safety in the Straits of Malacca and Singapore (Karma and Woon, 1998, pp. 486e496). It is more difficult for Malaysia and Indonesia to rebut the other opposing arguments. Indeed, in comparison with the Torres Strait, the Strait of Malacca is heavily relied upon to link the East and the West. The volume of shipping traffic is approximately 37.5% higher than that of the Torres Strait each year. The imposition of compulsory pilotage would inevitably increase global shipping costs. The Strait of Malacca does not have a long history of pilotage. Pilotage is quite new to the Strait and has only been discussed seriously since 1977. The issue of sufficiency of pilots is also worth considering. With the high volume of traffic passing through the Strait, could Malaysia and Indonesia be able to provide enough pilots? Nonetheless, prior to preparing the Strait of Malacca for the imposition of compulsory pilotage, it is anticipated that both the littoral States of the Strait have made proper arrangements to meet the future demands of pilots (Rusli, 2011b, pp. 39e50). 8. Conclusion The Straits of Malacca and Singapore are ancient trading and shipping routes. These waterways are also important economic lifelines for the coastal population of Malaysia, Indonesia and Singapore. The LOSC provides that ships may enjoy the unimpeded right of transit passage through straits used for international navigation. With the booming industries of the East Asian economic powerhouses, the Straits are now accommodating increasing shipping traffic each year. The heavy shipping activities that are taking place in these waters have resulted in the degradation of the marine environment of the Straits of Malacca and Singapore. As a result, suggestions have been made to propose the Straits as a PSSA.

As far as PSSA criteria fulfillment is concerned, there are a number of attributes that both the Straits of Malacca and Singapore and the Torres Strait share. As such, like the Torres Strait, the Straits of Malacca and Singapore may also potentially fulfill the requirements needed for a PSSA designation as laid down in Resolution A.982 (24). Given the busy nature of the Straits, the traffic limitation scheme may be the most suitable APM among the three to be introduced in the Straits. Further research has to be undertaken in determining the maximum carrying capacity of the Straits and to come up with a way to cap traffic without considerably affecting the global economy. The introduction of any of these three APMS in the Straits may be highly contentious and likely to draw protests as they may directly or indirectly impede the right of transit passage that vessels currently are exercising. It is an undeniable fact that together, the Straits of Malacca and Singapore are a priceless maritime legacy for the littoral States and the international community. In order to ensure that the economic potential and environmental sustainability of the Straits are balanced, it is crucial to impose measures to protect the marine environment of the Straits from further degradations. If efforts are not made to achieve this objective, the Straits will, in time become a ‘neglected’ or ‘depreciated’ heritage of the maritime world.

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