Ship Registration

According to WIKIPEDIA Ship registration is the process by which a ship is documented and given nationality of the country that the ship has been documented to. The nationality allows a ship to travel internationally as it is proof of ownership of the vessel.

International law requires that every merchant ship be registered in a country, called its flag state. Ship registration is similar to a person receiving a passport. A ship is bound to the law of its flag state. It is usual to say that the ship sails under the flag of the country of registration.

A ship’s flag state exercises regulatory control over the vessel and is required to inspect it regularly, certify the ship’s equipment and crew, and issue safety and pollution prevention documents. The organization which actually registers the ship is known as its registry. Registries may be governmental or private agencies. In some cases, such as the United States’ Alternative Compliance Program, the registry can assign a third party to administer inspections.

A registry that is open only to ships of its own nation is known as a traditional or national registry. Registries that are open to foreign-owned ships are known as open registries, and some of these are classified as flags of convenience.

Flag of convenience is the business practice of registering a merchant ship in a sovereign state different from that of the ship’s owners, and flying that state’s civil ensign on the ship. Ships are registered under flags of convenience to reduce operating costs or avoid the regulations of the owner’s country. The closely related term open registry is used to describe an organization that will register ships owned by foreign entities.

The term “flag of convenience” has been in use since the 1950s, and it refers to the civil ensign a ship flies in order to indicate its country of registration or flag state. A ship operates under the laws of its flag state, and these laws are used if the ship is involved in a case under admiralty law.

The modern practice of flagging ships in foreign countries began in the 1920s in the United States, when shipowners frustrated by increased regulations and rising labor costs began to register their ships to Panama. The use of open registries steadily increased, and in 1968, Liberia grew to surpass the United Kingdom as the world’s largest shipping register. As of 2009, more than half of the world’s merchant ships were registered with open registries, and the Panama, Liberia, and Marshall Islands flags accounted for almost 40% of the entire world fleet, in terms of deadweight tonnage.

We assist our clients with registration of vessels in Isle of Man, Marshall Islands and Panama.