Monitoring compliance to environmental laws and regulations can be costly and
time consuming for insurers, shipowners and regulators alike. Failure to comply
with legislation relating to the recycling of vessels, such as the European Waste
Shipment Regulations and UN Basel Convention, as well as local laws, may lead to
serious consequences, including imprisonment of the parties involved, investigation
of the insurers and heavy financial penalties. Above all, these cases will hit the media
powerfully, resulting in significant reputational consequences.