Ship Registration: Law and Practice

Page 45


International registers

Meaning and use

4.1 The term ‘flag of convenience’ has for a long time been as widely used in the popular media as in the shipping industry. The phrase has come to signify the evils of rampant capitalism and the disregard of labour rights, safety standards and environmental protection in the pursuit of profit by anonymous offshore corporations. The phrase has developed a wide currency and emotive force, particularly following the significant oil pollution suffered as a result of the sinking of the tankers Exxon Valdez, Braer, Erika, and Prestige. Although a significant majority of the world’s merchant tonnage now operates using this model of registration and with the leading open registries consistently appearing in the White Lists of port State control statistics, the phrase retains a harsh pejorative tone. Now a historic reputation without foundation, based on prejudice rather than fact, without question it can no longer be seriously maintained that open registries or flags of convenience – per se – harbour sub-standard vessels or are unscrupulous in their compliance with international Conventions. 4.2 There is no standard legal definition of the term ‘flag of convenience’, known in less emotive parlance as an ‘open registry’. For the purpose of this chapter, we shall adopt the neutral and factual categorisation of ‘international’ or ‘open” registers, signifying the ability of a ship-owner to register a vessel in a particular flag State regardless of his own nationality as a determining factor in the grounds of his qualification or entitlement to do so. These flag States permit registration for reasons of commercial expediency rather than any prerequisite sentimental, patriotic or naturally domiciled allegiance. As the Virginia G case confirms, the UNCLOS requirement of a genuine link existing between the flag State and the ship is concerned with supervision of the vessel by the flag administration and not conditional upon attachment or affiliation of any kind by the owner towards the country.1 4.3 A definition adopted by the Maritime Transport Committee of the Organisation for European Economic Co-operation in the year of the 1958 High Seas Convention referred to:

such countries as Panama, Liberia, Honduras and Costa Rica whose laws allow – and, indeed, make it easy for – ships owned by foreign nationals or companies to fly these flags. This is in contrast to the practice in the maritime countries (and in many others) where the right to fly the national flag is subject to stringent conditions and involves far-reaching obligations.2

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