Nautilus news

Stern words for government and UKSR over drop in registered vessels

31 July 2019

General secretary's message August 2019

This month I’ve been engaging with colleagues in preparations for the General Meeting in October and setting out a vision for our organising activity across the Union.

IMO Day of the Seafarer fell on the day of our Netherlands branch AGM and industry symposium, and it was a privilege for me to address our members there, alongside representatives of the Dutch maritime and shipping industry, on the issues of seafarer wellness and diversity. I was also invited to the naming ceremony for the Spirit of Discovery, a new UK-flagged boutique cruise ship.

That little bit of good news brings me to the shocking revelation that the UK Ship Register has fallen in size by more than one-third over the past year. Continuing political and financial flux around Brexit is being blamed for the exodus, which has seen the total gross tonnage cut from around 16.5m at the start of the year to just 10.9m last month.

The government’s apparent response to this situation has been to widen the UK flag eligibility criteria and ‘internationalise’ the ship register, opening the doors to owners and operators from the likes of China, the USA, Bahrain, Brazil, UAE and Japan.

The significance of such a shift in shipping policy should not be underestimated, especially if the UKSR fails to ensure that ships registering here have a ‘genuine link’ as required by the UN Convention on the Law of the Sea and outlined in Articles 91, 94 and 217. While the MCA is adamant that the UKSR has no intention of becoming a flag of convenience, it seems shockingly complacent about its UNCLOS obligations. Rest assured we have already started the process of reminding them!

It seems that UKSR officials will be once again clocking up the air miles as they seek to entice tonnage from other ship registries from around the world. What the UK government should be doing is encouraging inward investment of more than just the ships, developing our own fleet and building a new generation of British shipowners committed to British seafarers. The UKSR could be working to bring back the two-thirds of British-based owners who have stubbornly remained under foreign flags (mostly the Red Ensign Group I’d wager) despite the attractions of the tonnage tax regime. The government should reform the Red Ensign Group, make the tonnage tax more competitive, and formally link access to all UK fiscal incentives to the registration of ships in the country.

I’d like to see the UK government considering why other traditional maritime nations, such as the Netherlands, have managed to grow their fleets. Dutch shipowners display a much greater loyalty to the national flag than their British counterparts – and the modern and diverse Dutch fleet remains a global leader in some key sectors. This should be our model, not that of FOCs like Liberia, Panama or the Marshall Islands.

With the UKSR now having a new director, following the sudden departure of Doug Barrow, my advice to his replacement is to stop thinking of shipowners as customers. The UK is not running a supermarket. We are exercising our sovereign right to operate a ship register in accordance with UNCLOS, and the task of government is regulatory oversight of the ships that fly the Red Ensign. The MCA, on behalf of the government, has the responsibility to do that in accordance with national and international law.

One thing is for sure: without the assurances we have sought on ownership and control of UK registered tonnage, the drift to ‘international’ status is going to end in tears. I’ll be standing by with a big box of tissues.

Instead of the doomed policy of making the UKSR more international, the government should be developing our own fleet and building a new generation of British shipowners committed to British seafarers