Ship Registration: Law and Practice
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CHAPTER 17
Liberia
Liberia
17.1 Liberia is an independent democratic republic situated on the coast of west Africa between Sierra Leone and the Côte d’Ivoire, with a population of approximately 4.7 million. It was founded in 1822 as a colony for freed American slaves and subsequently gained its independence in 1847. It was the first democratic republic on the African continent. The Republic’s historical origins explain the country’s close links with the USA. Seven years of civil war ended in 1995, followed by a further period of instability and another civil war followed. In 2003, following an internationally recognised peace agreement, a National Transitional Government took control of the running of the country with the support of a UN International Stabilisation Force. In 2006 Ellen Johnson Sirleaf became Africa’s first elected female head of State and was re-elected in 2011. In 2018, George Weah took office following democratic elections. The President, who is elected for a six-year term, is chief of State and head of government. The legislative branch of government consists of the Senate and the House of Representatives, members of which are elected by popular vote. Following an Ebola epidemic, originated in Guinea, which began in March 2014 and ended in May 2015, Liberia continues to receive significant levels of international aid and material inward investment from, among others, the USA, the EU and China. Such inward investment includes several multi-billion dollar concession agreements in the iron ore and palm oil industries with numerous multinational corporations. The Liberian dollar (L$) and the US dollar are the two legal currencies. English is the official language. 17.2 Liberia has provided an open shipping register since 1948 and the Liberian fleet was in January 2017 the second largest in the world by dead-weight tonnage with over 11% of the global merchant fleet.1 In 1949 Liberia was a founding member of the International Maritime Organisation and remains active in this intergovernmental body. In 2017 it was re-elected as a member of the IMO Council. Since its inception, the administration and operation of both the maritime and corporate registries has been delegated by the Liberian Government to commercial entities based in the USA, acting as an exclusive agent. The Registry managed to operate continuously and successfully, even throughout the difficult years or war and epidemic. Led from central offices in Virginia and New York, Liberian International Ship and Corporate Registry LLC (‘LISCR’) assumed these responsibilities in 2000 and developed a global network of regional offices. The Liberia flag is now at the forefront of international practice including technological developmentsPage 185
Sources of law
17.3 The registration of vessels under the Liberian flag is governed by the Liberian Maritime Law, being Title 21 of the Liberian Code of Laws of 1956, as amended. Unless otherwise stated, all references to sections in this chapter are references to sections of the Liberian Maritime Law. Legislative changes introduced in 2002 incorporated, among other things, improved ship mortgage financing laws and provided for the formation of new types of corporate vehicles. The Maritime Program of the Republic of Liberia established by the provisions of Title 21 and of Regulations and Rules made by the Commissioner pursuant to the provisions of section 11 shall be administered by an agent of the Liberian Government, designated and appointed by the Government of the Republic of Liberia for the purpose of aiding the Commissioner in the effective administration of the provisions of the Maritime Law.Vessel eligibility
Vessel size and type
17.4 Any sea-going vessel of more than 500 net tons engaged in the foreign trade, wherever built, owned by a citizen or national of Liberia. (s.51(2)) may be registered in the registry administered by LISCR. Self-propelled or sailing vessels of 20 net tons and over engaged in trade exclusively between ports of Liberia and pleasure boats of 24 metres or over may be registered (s.51(1), (3)) with the Liberian Small and Pleasure Watercraft Registry. An application for waiver of tonnage is required for consideration by the Commissioner or Deputy Commissioner to register a sea-going vessel of less than 500 net tons. A waiver can be granted if applicable conditions and all other requirements for registration in accordance with section 51(2)(a), (6) and (7) are fulfilled.Age limits
17.5 Sea-going vessels or pleasure yachts will not be eligible for initial registration if they are more than 20 years old from the date of first construction on 1 January in the year when registration is sought. However, the Commissioner or Deputy Commissioner has a discretion to waive the age limit if a vessel can be shown to meet all otherPage 186
Ownership
17.6 A registered Liberian vessel is required to be owned by a Liberian citizen or national, although a waiver may be given to permit registration by a foreign corporate body that has been registered in Liberia as a foreign maritime entity (FME). The expression ‘citizen or national’ includes corporations, registered business companies, partnerships, limited partnerships, limited liability companies, FMEs and associations of individuals. Payments can be made by wire transfer, check and credit card. The Liberian Corporate Registry offers also electronic self-service online platform, eCORP, to its corporate clients.Company formation
17.7 Incorporation of corporations, limited partnerships, limited liability companies (LLCs) and registered business companies in Liberia is regulated by two separate pieces of legislation, depending on the type of corporate vehicle:- (1) the Business Corporation Act (as amended), which forms part of the Associations Law, Title 5 of the Liberian Code of Laws Revised, 1977. The Business Corporation Act, which is modelled on the equivalent statute in the State of Delaware, applies to every resident and non-resident domestic corporation, limited partnership and LLC (as well as foreign corporations authorised to do business in Liberia), other than registered Business companies (see below);
- (2) the Registered Business Company Act came into effect in 2002. This Act was introduced in response to a demand for an alternative type of company, which is required to file annual returns and other information in much the same way as in the UK. Indeed, the legislation has much in common with the UK Companies Act 1929. Registered business companies offer a greater degree of public transparency than Liberian business corporations.
Liberian business entities may be incorporated to order, or purchased off the shelf through the global offices network of LISCR. Corporations and companies can be incorporated by LISCR within one working day.