Carnival Cruises 2008 Annual Report Download - page 22

22
Our ships that call at U.S. ports are subject to inspection by the U.S. Coast Guard for
compliance with SOLAS, by the U.S. Public Health Service for sanitary standards, and by
other agencies such as U.S. Customs and Border Protection, with regard to customs and
immigration. Our ships are also subject to similar inspections pursuant to the laws and
regulations of various other countries our ships visit.
In 2006, the International Labour Organization ("ILO") adopted a new Consolidated
Maritime Labour Convention (the "Convention"). The ILO is also an agency of the United
Nations that develops worldwide employment standards. There have been over 60 maritime
labor conventions and recommendations developed since 1920 in areas such as minimum age of
seafarers, medical certificates, recruitment practices, health and welfare, hours of work,
and social security. The Convention is a comprehensive instrument that consolidates all of
the existing standards and recommendations into one instrument to reflect modern conditions
and language that will govern all aspects of crew management for all ships in international
commerce. While many of the practices were widely adhered to by ships registered in
different countries, this consolidated Convention will place additional requirements on
shipowners not previously in effect. Thirty member countries representing 33% of the
world's merchant ship tonnage will be required to ratify the Convention before it goes into
effect 12 months after such ratification. We currently expect the Convention to be ratified
in 2010, and to enter into force and require our implementation in 2011. Accordingly, if
ratified, the Convention may increase our crew costs from 2011 and beyond.
We believe that maritime health, environmental, safety and security issues will
continue to be an area of focus by relevant government authorities in the U.S., the EU and
elsewhere. Resulting legislation, regulations or treaties, or changes thereto, could impact
our operations and would likely subject us to increasing compliance costs in the future.
b. Permits for Glacier Bay, Alaska
In connection with certain of our Alaska cruise operations, Holland America Line,
Princess and Carnival Cruise Lines rely on concession permits from the U.S. National Park
Service ("NPS") to operate their cruise ships in Glacier Bay National Park and Preserve.
Such permits must be periodically renewed, and we cannot be certain that they will continue
to be renewed or that regulations relating to the renewal of such permits, including
preference or historical rights, will remain unchanged in the future. In January 2009, the
NPS renewed our permits through the 2019 Alaska cruise season.
c. Alaska Environmental Regulations
The State of Alaska enacted legislation which prohibits certain discharges in
designated Alaskan waters, ports or near shorelines and requires that certain discharges be
monitored to verify compliance with the standards established by the legislation. Both the
state and federal environmental regimes in Alaska are more stringent than the federal regime
under the Federal Water Pollution Control Act with regard to discharge from vessels. The
legislation also provides that repeat violators of the regulations could be prohibited from
operating in Alaskan waters.
d. Other Environmental, Health, Safety and Security Matters
We are subject to various international, national, state and local environmental
protection and health and safety laws, regulations and treaties that govern, among other
things, air emissions, employee health and safety, waste discharge, water management and
disposal, and the storage, handling, use and disposal of hazardous substances, such as
chemicals, solvents, paints and asbestos. We are committed to helping to preserve the
environment, not only because of the existing legal requirements, but because a pristine
environment is one of the key elements that bring our guests on board our ships.
In particular, in the U.S., the Act to Prevent Pollution from Ships, implementing the
MARPOL convention, provides for severe civil and criminal penalties related to ship-
generated pollution for incidents in U.S. waters within three nautical miles and in some
cases in the 200-mile exclusive economic zone.
Furthermore, in the U.S., the Oil Pollution Act of 1990 (the "OPA") provides for strict
liability for water pollution, such as oil pollution or threatened oil pollution incidents
in the 200-mile exclusive economic zone of the U.S., subject to monetary limits. These
monetary limits do not apply where the discharge is caused by the gross negligence or
willful misconduct, or the violation of an applicable safety, construction, or operating
regulation by a responsible party. These monetary limits also do not apply where the
responsible party fails or refuses to report the incident as required by law, provide all
reasonable cooperation and assistance in connection with removal operations, or without