Many European shipping companies are knowingly sending their end-of-life ships for scrap in dangerous and polluting yards in Bangladesh. 

This 90-page report finds that Bangladeshi ship breaking yards often take shortcuts on safety measures, dump toxic waste directly onto the beach and the surrounding environment, and deny workers living wages, rest, or compensation in case of injuries. The report reveals an entire network used by shipowners to circumvent international regulations prohibiting the export of ships to facilities like those in Bangladesh that do not have adequate environmental or labor protections.

Recommendations

The Government of Bangladesh

• Enforce the 2009 High Court orders which halted the import of ships for recycling until there were “satisfactory provisions for the safety of the workers.” Properly enforce the High Court’s 18-point directive that required rigorous health and safety standards and labor rights protections.
   
• Immediately shut down any shipbreaking yards employing children.
   
• Immediately shut down any yards found to be holding night operations or or where there are other serious violations of workers’ rights.
• Set a timebound directive to yards to move all ship recycling operations off the beach and to install proper industrial platforms in accordance with the Basel Convention Technical Guidelines on Ship Recycling.
• Employ occupational health and safety measures in line with ILO Conventions 155 on Occupational Health and Safety, 162 on Asbestos, and 148 on Working Environment to ensure workers’ protection from exposure to toxic substances. Ratify the above ILO conventions.
• Invite the special rapporteur on toxics and human rights to visit Bangladesh, and Chittagong specifically.
• Establish consistent and transparent monitoring and reporting on occupational diseases related to shipbreaking including cancer and asbestosis.
• Ensure workers are educated and informed on exposure to toxic materials in shipbreaking and the potential health consequences.
• Adequately and speedily compensate and rehabilitate all workers who have been injured or, in the case of death, their families, as provided under the Labour Act, 2006, and the Shipbreaking and Recycling Rules, 2011.
• Establish an impartial court-appointed committee to submit a report to the court detailing the compliance of yards according to the Labour Act, 2006, the Shipbreaking and Recycling Rules, 2011, and the Bangladesh Ship Reprocessing Act, 2018. The committee should submit a comprehensive report describing all measures taken by the yards for treatment, compensation, and rehabilitation of workers injured or killed while working in the shipbreaking yards.
• Amend the structure of the Bangladesh Ship Recycling Board (BSRB) to include civil society representatives including local environmental protection groups, labor rights groups, older people’s associations, organizations of persons with disabilities, and shipbreaking workers. Ensure that these representatives have equal voting power in balance with other representatives.
• Require all shipbreaking yards to use clear contracts when hiring workers, routinely audit all shipbreaking facilities and suspend operations of those found to be hiring workers without a contract or otherwise violating labor rights.
• Ensure all workers are paid according to the minimum wage set out in 2018 by the Ministry of Labor and Employment.
• Enforce Section 195 of the Bangladesh Labor Act 2006 (amended 2018) which makes it illegal to “dismiss, discharge, remove from employment a worker, or injure or threaten to injure him in respect of his employment by reason that the worker is or proposes to become, or seeks to persuade any other person to become, a member or officer of a trade union.”

• As set out in the Bangladesh Ship Reprocessing Act, 2018, build a functioning hazardous waste storage, treatment, and disposal facility for shipbreaking that meets international standards for the management of toxic waste and ensure compliance.
• Instruct the Department of Environment to carry out regular and unannounced monitoring of air, soil, and water quality around shipbreaking yards. The Department of Environment should publicly report findings and exercise its authority to revoke authorization from any yard that is not meeting international standards for the environmentally sound management of hazardous waste.
• Call on the director general of the Department of Environment to exercise their authority under the Environmental Conservation Act to order ship recycling yard owners to pay compensation if they are found to have caused direct or indirect “injury to the ecosystem.”
• Follow the Bangladesh High Court directive to stop importing scrapped ships sailing under flags that have been gray or blacklisted by port state controls.

The European Commission:

• In the review being undertaken in 2023/24, amend the EU Ship Recycling Regulation (EU SRR) to apply to the ship’s beneficial owner, not the flag state. If the ship is sold, the EU SRR should remain applicable to the previous owner for no less than two years from the date of sale.
• Create a transparency register of ship ownership, requiring shipping companies to publicly disclose beneficial ownership, including cash buyers.
• Create a “return scheme” for ships as described in the EU Ship Recycling Regulation preamble. The return scheme would require any ship that trades in the EU to pay a fee towards a recycling license, accumulating capital over time. The total will then only be paid back to the last owner of the vessel if the ship is recycled at a ship recycling yard on the list of EU-approved facilities.
• Require all shipping companies conducting operations in the EU to implement a risk-based approach due diligence policy on their whole value-chain in line with the UN Guiding Principles on Business and Human Rights (UNGP), recognizing shipbreaking as a high-risk business operation, and to publicly report all sales, including to cash buyers, to ensure the traceability of the ship’s beneficial ownership over its lifetime.
• Ensure that the proposed EU Corporate Sustainability Due Diligence Directive (CSDDD) covers the full value chain, including the use, disposal, and recycling of goods.
• Update the 2004 Community Guidelines on State Aid to Maritime Transport to include a tonnage tax subsidy conditioned on recycling of ships in a yard that meets international standards.

The International Maritime Organization:

• Work closely with the UN Divisions for Oceans and the Law of the Sea to determine restrictions and public reporting requirements to ensure that a ship’s “genuine link” to its flag is meaningful. Sanction flag states each time they are used by cash buyers at end-of-life when a ship is sent to a yard that uses beaching and occupational health and safety standards are not met.
• Require all ships that are dismantled to include a list of hazardous materials according to the IMO standards. Regularly monitor certification procedures in major shipbreaking destinations and penalize those who fail to comply.
• In line with the recommendations laid out by the special rapporteur on toxics, Marcos Orellana, following his visit to the IMO, establish a dedicated stream of work on human rights, including a dedicated human rights office within IMO and a human rights ombudsperson or special adviser to the Secretary-General.
• Provide full public access to audit reports on member states’ implementation and enforcement of the applicable IMO instruments.
• Improve transparency by clarifying and minimizing circumstances under which media can be excluded from IMO proceedings.

Shipping Companies:

• In line with the UNGP and with the upcoming CSDDD, adopt formal and explicit due diligence policies that ensure the company maintains oversight of where ships are recycled and ensures that ships previously owned or operated by your company are not discarded in yards that use the beaching method. Adopt an explicit “off the beach” policy.
• Ensure that ships are not recycled in yards that use child labor.

• Regularly monitor conditions in the yards where the company’s ships are being dismantled, including by engaging safely and meaningfully with the workers and their representatives, and provide public updates. Engage with shipbreaking facilities owners to support them in their reform process.
• Publicly report on types and amounts of hazardous materials onboard vessels within your entire fleet according to the standards set by the IMO.
• Invest in ship recycling facilities so that they can ensure full containment, stable industrial platforms, protective equipment, and environmentally sound management of hazardous materials, including disposal.
• Adopt a sustainable “cradle-to-cradle” approach, investing in green shipbuilding practices developed in close consultation with sustainable recycling experts.
• Support legislation for a ship recycling license.
• Publicly report and keep track of all sales of ships across their lifetime up to the time of their recycling. Publicly report on the place and conditions of the specific facilities where they are recycled.

• Adopt public commitments as a requirement of membership in the SRTI, including not to sell ships to cash buyers and to ensure ships are not sold to yards that practice ‘beaching.’
• Require all shipping companies conducting operations in the EU to implement a risk-based approach due diligence policy on their whole value-chain in line with the UN Guiding Principles on Business and Human Rights (UNGP), recognizing shipbreaking as a high-risk business operation, and to publicly report all sales, including to cash buyers, to ensure the traceability of the ship’s beneficial ownership over its lifetime.
• Ensure that the proposed EU Corporate Sustainability Due Diligence Directive (CSDDD) covers the full value chain, including the use, disposal, and recycling of goods.

Financial Institutions:

• Adopt a policy against financing or providing loans for the purchase of ships to shipbreaking yards that use the ‘beaching’ method.
• Adopt the Responsible Ship Recycling Standards.
• Divest from shipping companies that sell to cash buyers or whose ships end up in yards that use the beaching method and violate labor rights.
• Invest in developing recycling capacity that complies with international standards on occupational, health, and safety, including the use of industrial platforms, such as drydocks, and supports a transition towards sustainable life cycle management.