Royal Caribbean Cruise Lines 2013 Annual Report Download - page 25
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PART I
Recent European Union regulations (effective Decem-
ber 31, 2012) and the 2002 Protocol to the Athens
Convention (effective April 2014 for countries that have
ratified the Protocol) both provide for substantial
increases to the level of compulsory insurance which
must be maintained by passenger ship operators.
Compliance with these EU regulations has not had a
material impact on operating costs and we do not
expect that compliance with the 2002 Protocol, when
it becomes effective, will have a material impact on
our operating costs.
TRADEMARKS
We own a number of registered trademarks related to
the Royal Caribbean International, Celebrity Cruises,
Azamara Club Cruises, Pullmantur and CDF Croisières
de France cruise brands. The registered trademarks
include the name “Royal Caribbean International”
and its crown and anchor logo, the name “Celebrity
Cruises” and its “X” logo, the name “Azamara Club
Cruises” and its globe with an “A” logo, the names
“Pullmantur Cruises” and “Pullmantur” and their logos,
the name “CDF Croisières de France” and its logo,
and the names of various cruise ships. We believe our
trademarks are widely recognized throughout the
world and have considerable value.
REGULATION
Our ships are regulated by various international,
national, state and local laws, regulations and treaties
in force in the jurisdictions in which they operate.
In addition, our ships are registered in the Bahamas,
Malta or in the case of Celebrity Xpedition, Ecuador.
Each ship is subject to regulations issued by its coun-
try of registry, including regulations issued pursuant
to international treaties governing the safety of our
ships, guests and crew as well as environmental pro-
tection. Each country of registry conducts periodic
inspections to verify compliance with these regulations
as discussed more fully below. Ships operating out of
United States ports are subject to inspection by the
United States Coast Guard for compliance with inter-
national treaties and by the United States Public Health
Service for sanitary and health conditions. Our ships
are also subject to similar inspections pursuant to the
laws and regulations of various other countries our
ships visit.
We believe that we are in material compliance with
all the regulations applicable to our ships and that we
have all licenses necessary to conduct our business.
Health, safety, security, environmental and financial
responsibility issues are, and we believe will continue
to be, an area of focus by the relevant government
authorities in the United States and internationally.
From time to time, various regulatory and legislative
changes may be proposed that could impact our
operations and subject us to increasing compliance
costs in the future.
Safety and Security Regulations
Our ships are required to comply with international
safety standards defined in the International Conven-
tion for Safety of Life at Sea (“SOLAS”), which among
other things, establishes requirements for ship design,
structural features, materials, construction, life saving
equipment and safe management and operation of
ships to ensure guest and crew safety. The SOLAS
standards are revised from time to time and the most
recent modifications were phased in through 2010.
Compliance with these modified standards did not
have a material effect on our operating costs. SOLAS
incorporates the International Safety Management
Code (“ISM Code”), which provides an international
standard for the safe management and operation
of ships and for pollution prevention. The ISM Code
is mandatory for all vessels, including passenger
vessel operators.
All of our operations and ships are regularly audited by
various national authorities and maintain the required
certificates of compliance with the ISM Code.
Our ships are subject to various security requirements,
including the International Ship and Port Facility
Security Code (“ISPS Code”), which is part of SOLAS,
and the U.S. Maritime Transportation Security Act of
2002 (“MTSA”), which applies to ships that operate
in U.S. ports. In order to satisfy these security require-
ments, we implement security measures, conduct
vessel security assessments, and develop security
plans. The security plans for all of our ships have been
submitted to and approved by the respective countries
of registry for our ships in compliance with the ISPS
Code and the MTSA.
The Cruise Vessel Security and Safety Act of 2010,
which applies to passenger vessels which embark or
include port stops within the United States, requires
the implementation of certain safety design features as
well the establishment of practices for the reporting
of and dealing with allegations of crime. The cruise
industry supported this legislation and we believe
that our internal standards are generally as strict or
stricter than the law requires. A few provisions of the
law call for regulations which have not yet been issued.
We expect the U.S. Coast Guard to issue these regula-
tions in 2014. While we cannot predict the full scope of
such regulations, we believe we already meet or exceed
the requirements of the act and do not expect any
material costs due implementing these regulations.