Ship Registration

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Foreword

On behalf of the reader it is needles to say that, for those who share an equal interest with regards to marine vessels, also create a special desire for the perfect offshore registration location subject to the purpose of the trade ore pleasure.

Ship Registration in Offshore Centres

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Ship registration and also ship management are highly specialised areas and a detailed discussion, for the reader should be aware of the reasons why offshore centres are regularly used as a location to registers hips as well as some of that basic administration issues which service providers should be aware of.

Flag of convenience
This is a term which is often applied to those offshore centres which provide facilities for ships to be registered in their jurisdiction. In general terms, a 'flag of convenience' is often used to describe the situation where a vessel is registered in a country or state which is not the country or sate where it was originally built or registered.

Ship owners therefore have the option top choose the laws and regulations of another marine administration rather than be governed by those of their 'home' country.

However, by the same token there is also the possibility that the centre chosen to register she ship will not have the same level of safety standards or manning requirements, etc. which would generally be expected by shipping unions and safety watchdogs.

A large number of offshore centres now have their own shipping registers and the following are some of those which can be used for this type of business: the Bahamas, Bermuda, BVI, the Cayman Islands, Cyprus, Gibraltar, Isle of Man, Madeira, Malta, Netherlands Antilles, Panama, Singapore and Vanuatu.

With the exception of the Isle of Man, all of the above centres are generally considered to offer flags of convenience.

Possible Benefits of Offshore Ship Registers
There are a number of possible reasons why it might be advantageous to register a ship in an offshore centre but the following are perhaps the most commonly quoted:

Confidentiality
The ownership of the vessel could remain confidential.

To avoid political problems in home country
Offshore centres are usually free from any political unrest or problems whereas many onshore centres experience political situations which could have an effect on the reputation and the security of the ships which are registered under those flags

To circumvent local legal issues
Some countries demand a certain percentage of the crew and officers be nationals of the home country. This would generically mean that local employment conditions must be applied (such as a minimum wage and maximum hours) which could be expensive for the ship owners to maintain. Generally, offshore ship registers impose no requirements in relation to the nationality of, or terms and conditions imposed on, the crew which ships employ.

Taxation
There could be taxation benefits on the basis that the offshore centre will be a no or low tax centre. In addition, some centres have double taxation agreements in place with certain onshore counties which might create planning opportunities in relation to the cost of building a vessel.

Lower costs
It is often cheaper to register a ship offshore and usually the management costs will be less than those charged onshore.

Potential Problems of Offshore Ship Registration
Relaxed safety regulation
Some perceive an offshore shipping register to be an attempt to compromise safety and quality for possible tax benefits. This should not of course be the case although some workers' unions do boycott ships which fly a flag of convenience.

Insurance
Some insurance companies might be concerned that the local management and regulations in place in offshore centres (especially in terms of seaworthiness) will not be as stringent as those which are imposed in the more 'recognised' ship registers. Some might refuse to provide cover for ships registered offshore.

Registration Procedures
The following is a summary of the type of requirements which must usually be met before a shop can be registered in an offshore centre. (Victrola Independent kindly recommends the reader to seek more advice with regards to any specific centre). Usually, this information must be provided to the local Registrar of Ships (or equivalent):