A recently published study conducted by the Seafarers International Research Centre at Cardiff University has ranked 37 ‘flag states’ in terms of the regulatory efficiency of their shipping registries.
A number of recent environmental disasters involving ships sailing under ‘flags of convenience’, such as the sinking of the Bahamas-registered Prestige off the Spanish coast, have drawn attention to the role of the flag state in ensuring that vessels registered with it are seaworthy and safe.
Speaking following the release of the Flag State Audit 2003, Dr Nik Winchester, co-author of the study revealed that:
‘Current flag state practice enables vessel registers the freedom to define a regulatory environment in any way they see fit. Strong state regulation affects the desirability of the flag state to shipowners. In this market for flags, the profit motive and effective regulation compete, ultimately, to the detriment of the latter.’
The flag states were grouped into four bands following assessment of their regulatory regimes. Contained within the highly regulated category were the Danish Second Register, the German Second Register, the Kerguelen Islands, the Netherlands, the Norwegian Second Register, Norway, the Philippines, and the United Kingdom.
Judged to fall under the category of ‘good regulatory capacity’ were: Bermuda, the Canary Islands, the Cayman Islands, Cyprus, Estonia, Hong Kong, the Isle of Man, Latvia, Madeira, the Netherlands Antilles, Russia, Singapore, Turkey, and Ukraine.
Modestly regulated shipping registries included those of: Antigua and Barbuda, the Bahamas, Barbados, Belize, Bolivia, Equatorial Guinea, Honduras, Lebanon, Liberia, Malta, the Marshall Islands, Panama, and Vanuatu. The list of poorly regulated jurisdictions contained just Cambodia, and St Vincent and the Grenadines.
Commenting on the results of the three year study, initially commissioned by the International Transport Workers Federation, Dr Winchester announced that:
‘There are clear divisions in the regulatory power of flag states; a large number of open registers have failed to produce adequate regulatory regimes that ensure the safe operation of vessels, safeguard labour standards, and ensure the transparency of vessel ownership.’
He concluded: ‘Effective regulation depends upon the existence of a network of shared responsibility. All stakeholders in the maritime industry need to take an active stance in the maintenance of vessel standards and their operation. However, the flag state is often the weak link in the regulatory chain.’
By Jason Gorringe, Tax-News.com
