HAS THE EXCEPTION BECOME THE RULE? - EXAMINING THE GROWING DOMINANCE OF FLAGS OF CONVENIENCE IN INTERNATIONAL SHIPPING

Abstract

As a rule of international law, every ship must be registered to one state at a time the flag of which it becomes entitled to fly and the nationality of which it thereby acquires. Each state is also left to fix the conditions upon which it may register a ship. While some states fix strict rules and impose stiff conditions in this regard, and rigidly enforce maritime laws and regulations, others impose light conditions and make enforcement rather lax and perfunctory in order to attract shipping companies, register more and more ships and boost national revenue. Over time, the latter countries have registered much more ships at the expense of the former countries and accordingly earn more revenue from ship registration. Their critics have accused them of registering all manner of substandard ships which have largely been responsible for pollution of the oceans, sea mishaps, poor crew working conditions, illegal fishing, smuggling and maritime insecurity. This paper critically examines the continuously growing dominance of this category of vessels in the international shipping business and seeks to determine whether, due to this dominance, they have become the rule rather than the exception. It argues that considering the important role these vessels play in international shipping, and their wide acceptance by shippers, they have come to stay and that it is more profitable to bring them to play by the rules than to continue to denigrate them. The paper then makes prescriptions on how this could be done.