This article explores how the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (Hong Kong Convention or HKC) changes ship recycling obligations for shipowners and recycling yards. It explains the practical and legal implications of the HKC, and its entry into force, through six key questions. Interwits explains what it requires, how it interacts with other international regimes, and what responsible shipowners and recycling yards must now do to comply.
Why does the Hong Kong Convention matter, and why now?
Following a sixteen year gestation, the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (HKC) finally came into force on 26 June 2025. Its arrival marks an important change in the regulatory foundations of global shipping, especially for aging fleets. Prior to HKC, ship recycling was governed piecemeal using a string of guidelines, national rules and uneven industry practices. With it, the HKC introduces a single, internationally recognised framework setting out how recycling must be planned, documented and carried out.
The Convention exists because the shipping industry has long faced persistent challenges in recycling, i.e. hazardous materials, worker safety, and environmental impacts, without a coherent, binding structure to govern them. Its preamble recognises “growing concerns about safety, health, the environment and welfare matters in the ship recycling industry” and the need for a legally binding instrument to address these issues.
Where previous efforts focused on voluntary guidance, the HKC sets enforceable standards that follow a ship from construction to dismantling. Its entry into force does not radically transform global recycling overnight. But it does bring long-needed clarity to an essential phase of a vessel’s life. In addition, there are commercially significant aspects for owners, operators, charterers and financiers to consider because, under the HKC, recycling is no longer confined to an end-of-life decision, but it becomes a lifecycle responsibility that carries legal and reputational weight
What does the Hong Kong Convention require?
At its core, the HKC asks the industry to do three things: (1) know what hazardous materials are on board a vessel, including those incorporated into the ship’s structure; (2) plan how they will be handled at the end of life; and (3) recycle ships in facilities that are authorised and equipped to manage them safely.
The first requirement is the Inventory of Hazardous Materials (IHM). Every new ship must carry one from delivery, and every existing ship must develop one within five years of entry into force or before recycling, whichever comes first.
The IHM must identify the presence of hazardous materials as listed in Appendices 1 and 2 to the Convention, record their location and quantity, and be kept up to date throughout the ship’s life (Annex, Regulation 5). A poorly maintained IHM is treated as non-compliance. Indeed, under Article 8, inspectors may detain a ship if its inventory does not match its condition.
Second, the Convention requires ships to undergo surveys, including initial, renewal, additional and final surveys, to verify the accuracy of the IHM and the appropriateness of the Ship Recycling Plan (Annex, Regulation 10). These surveys lead to two certificates: the International Certificate on Inventory of Hazardous Materials and, at the end of life, the International Ready for Recycling Certificate.
Third, the ship may only be recycled in a Ship Recycling Facility authorised under the Convention (Article 6). To receive authorisation, a yard must demonstrate robust systems for worker safety, hazardous material removal, emergency preparedness, and environmental management (Annex, Regulations 16 to 23). Each vessel must have a ship-specific Ship Recycling Plan prepared by the yard, approved by the competent authority, and based directly on the ship’s IHM (Annex, Regulation 9).
Seen together, these obligations form a clear lifecycle compliance chain:
Build → Operate → Document → Prepare → Certify → Recycle
Whilst the Convention does not express it in these precise terms, the logic is that safe recycling begins long before a ship reaches the dismantlers.
How does the HKC complement the Basel and EU Ship Recycling Regulations?
The HKC operates alongside two other major frameworks: the Basel Convention and the EU Ship Recycling Regulation (EU SRR). This creates a framework that is partly aligned, partly overlapping, and complex at times.
The HKC stipulates how recycling should be carried out, including the safe removal of hazardous materials, yard authorisations, and ship-specific planning. Basel, on the other hand, regulates the movement of hazardous waste across borders. When a ship is sold for recycling, it may be considered “waste” under Basel, triggering requirements for consent from importing states and strict notification procedures. In the EU system, these obligations could fall under the European Waste Shipment Regulation (EWSR) where an EU member state determines that the vessel qualifies as “waste” under EU law and that the export originates within its jurisdiction.
This can create a tension where a ship can be fully HKC-compliant and still be subject to Basel restrictions. The HKC does not override Basel. In fact, Article 15 explicitly preserves obligations under other international agreements.
The EU SRR adds a third layer of requirements. It mirrors the HKC in many respects but imposes stricter conditions on EU-flagged ships. These may only be recycled in yards on the ‘European List’, and IHM obligations extend to non-EU ships calling at ports and anchorages in EU member states. The result is that the EU SRR often sets the higher standard.
What does the HKC mean for shipowners and recycling yards in practice?
The HKC primarily changes the rhythm of compliance for shipowners. Documentation that previously wasn’t needed, or only needed at the end of a ship’s life must now be maintained throughout its lifespan. A well maintained IHM will help owners avoid detentions, prevent delays during a sale, and reassure charterers and financiers who increasingly view recycling governance as part of Environmental, Societal, and Governance (ESG) performance. In effect, the HKC aligns recycling as a dimension of corporate responsibility. This concern is particularly heightened for tanker and LNG fleets. The presence of hazardous materials within their cargo systems and insulation, combined with the strict requirements for safe cleaning and gas freeing, elevates the operational and safety importance of recycling decisions for these vessels.
For responsible recyclers, gaining HKC authorisation represents a benchmark and an incentive to quality tonnage owners. The Convention sets clear expectations for ‘safe-for-entry’ procedures, worker training, hazardous material management, emergency planning, and record-keeping. Yards that meet these standards will demonstrate professionalism that they can use to differentiate and gain market trust. It isn’t clear yet how pricing will be impacted from the sub-compliant market, and authorisation is not a guarantee of uniform performance. Conditions and enforcement may vary widely across countries. As some shipowners and managers have observed, two HKC-authorised yards may meet the same legal threshold but deliver differing levels of safety and environmental control. Due diligence remains essential.
The HKC also has commercial implications for chartering and finance. Increased transparency around end-of-life procedures may prove to have an increased impact on fixtures, loan terms, and corporate reporting. Many stakeholders will now see the HKC as a key indicator of responsible asset management.
A simple way to understand the three frameworks is:
- The HKC governs ‘the how’.
It sets the technical and procedural standards for safe and environmentally sound ship recycling, including how hazardous materials must be identified, how yards must operate, and how the recycling process must be planned, certified and documented.
- Basel governs ‘the movement’.
It regulates when a ship is considered “waste” and how it may cross borders for recycling. Under the original Basel system, waste shipments required prior notification and consent. However, since the Ban Amendment entered into force in 2019, it prohibits exports of all hazardous wastes covered by the Convention that are intended for final disposal, reuse, recycling and recovery from countries listed in Annex VII (OECD, EU countries and Liechtenstein) to non-Annex VII countries. Some EU member states apply the Basel Convention through the EWSR and may determine that the export of an end-of-life ship qualifies as a waste shipment subject to these controls.
- EU SRR governs ‘the where’.
Where ships are flagged to an EU member state, recycling may only take place in facilities listed on the EU’s approved ‘European List’. IHM obligations also applies to non-EU ships when they call at ports or anchorages in EU Member States, although the requirement to use a European-listed recycling facility applies only to EU-flagged vessels.
Together these governors form the regulatory roadmap that owners must follow at various stages of a vessel’s lifecycle.
Where do owners get caught out, and what does good HKC practice look like?
Most compliance issues arise not from the complexity of the Convention, but from familiar operational habits that have not yet adapted to its logic.
An emerging pitfall is the ‘static IHM’, where inventories are created once and subsequently left untouched. Remember, under the HKC, an IHM that is not actively maintained could be non-compliant if found to be “seriously deficient” by port state control inspectors. Another challenge is timing. Recycling decisions made in a rising or falling market often compress the required sequence of notifications, surveys and approvals, especially where Basel pathways apply. Weak or unenforceable sale clauses can also create downstream risk if a vessel is resold before reaching the yard.
Good practice, therefore, begins early. Ships whose inventories are updated during routine maintenance have far fewer problems at the end of their life. Owners who treat recyclers as partners by sharing information, clarifying expectations, and reviewing yard plans will see more predictable outcomes. And the best yards go beyond minimum requirements by documenting not only the dismantling, but downstream waste handling, offering the transparency that modern ESG reporting demands.
In essence, good HKC practice is defined by intent: the intent to ensure a ship is recycled with the same diligence applied to its construction and operation.
What is the way forward under the HKC?
The Hong Kong Convention intends to be a stabilising force in ship recycling. It brings a coherence to an industry process that is long overdue for structure and offers owners a predictable pathway through the most uncertain stage of a vessel’s life.
All shipowners must now consider how they will embed HKC obligations into every day fleet management; maintain accurate documentation; select authorised and reputable yards, and understand the regulatory interplay that governs cross-border recycling.
For recycling yards, the HKC is an opportunity to demonstrate professionalism and earn sustained global confidence. As Interwits puts it: “Responsible recycling has now become a measurable hallmark of good ship management”.
Interwits supports clients across all aspects of the HKC, Basel, EWSR and EU SRR compliance, from IHM maintenance and documentation, to yard selection, due diligence, sale contracts and regulatory strategy, helping ensure that recycling decisions are legally sound, commercially sensible, and operationally safe.
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