Perils of Flags of Convenience in the maritime industry

By Adekunle Segun

A flag of convenience ship or vessel (FOC) is the vessel that flies a flag of other countries other than the country of ownership or origin. Flags of convenience usually apply to merchant ships where the owner of the vessel tries to get an “easy way out” of certain strict practices of the home country of the owner of the ship. FOC as a practice is a war strategy where merchant vessels try to evade enemy warships that may attack them while idle or on the way to their destinations. Warships of the ancient era were also noted to have flown false flags of ally states to avoid being shelled by enemy vessels. It should be noted that during wars, including in modern times, merchant vessels are usually employed to convey critical supplies to certain areas of operation or countries that may be hard hit. However, these merchant vessels are always subject to attack or aggression from enemy country’s destroyers and other naval ships. During world war II the German U-boats were a recurrent nightmare on the seas as they sank a record number of merchant vessels carrying vital supplies from the United States to Britain, amongst other routes. To avoid being sunk by enemy warships, certain shelling evasive measures had to be adopted on the course of passage, especially for heavily garrisoned precincts on the sea.

However, in modern day practice, a sizable number of fleet owners have decided to adopt this approach for so many reasons, some of which help the vessel owner have a soft landing and avoid certain regulations from the home country where the vessel is registered. The guarantee of cheap labour, lack of proper housekeeping, amongst other vices, are some of the factors that accompany a vessel with a flag of convenience. An adequately controlled register or flag will not entertain such shortcomings with any ship flying their ensign.

Flags of convenience also came up in the United States when various cruise ships owners, seeking to serve alcohol to passengers aboard their ships, decided to carry such flags as the Panama ensign. This brought a lot of perceived advantages like beating regulations and regulatory agencies, evading rising cost of human and quality materials, avoiding administrative and logistics cost of transporting port state personnel to and from subject vessels, amongst others.

The direct impact of FOC practice is usually felt by the seafarer who ultimately has to toil under certain conditions that may be very inimical to their health. Flag of Convenience countries include the following, Antigua and Barbuda, Bahamas, Barbados, Belize, Bermuda (UK), Bolivia, Cambodia, Cayman Islands, Comoros, Cyprus, Equatorial Guinea, Faroe Islands (FAS), French International Ship Register (FIS), German International Ship Register (GIS), Georgia, Gibraltar (UK) and Honduras.

There are quite a lot of dangers associated with a vessel flying a FOC, some of which I will try to highlight here. In the first place, the FOC vessels pose a huge measure of bleakness and unpredictability on seafarers working on board such vessels. For a typical seaman an FOC vessel spells danger in quite a lot of ways for their career. The seamanship career already is fraught with perils like physical injury, an unbalanced workload, mental instability and sea sickness. The practice of FOC has further exacerbated this situation as countries with rigid flags and ensigns have curative measures for situations such as this. However, there is no mandated approach to these scenarios for a ship with an FOC.

Another danger posed by an FOC vessel is improper or vaguely defined compensation. Seafarers face a lot of dangers in the course of their jobs aboard, but not providing adequate compensation in the event of an accident is another nightmare on its own. There are countless cases of mariners getting major injuries aboard such ships due to bad working conditions. Worst of all is that they are not adequately attended to.

FOC vessels have also been hugely found to be guilty of illegal trade amongst other vices. The level of manipulations that can happen on the documents of these vessels makes it very easy for them to engage in such trade. Odd trades like drug smuggling, illegal substance passage and human trafficking are just some of these activities. A typical seafarer on board these vessels may even be oblivious of certain contents on the ship. They will then be eventually roped-in while carrying out their legitimate job. There have been several occasions where seafarers have been arrested for crimes they do not even know about.

FOC vessels also cause a lot of maritime accidents and disasters. This is largely due to lack of port state inspection and audit of such vessels. We may recall one of my previous articles where I mentioned the incident on the ‘deep water horizon’. Though this was an oil rig and not a ship in the real sense of the word, it is still mandated to be flagged as it is the practice in the maritime industry. The fact that she was flying the FOC ensign predisposed her to the disaster that eventually caused a huge volume of crude to be spilled into the Gulf of Mexico.

The right of a seafarer on board an FOC vessel is another cause for serious concert. There are certain fundamental rights of a seafarer, like joining trade unions, demanding better working conditions, befitting take home pay, amongst other right protecting measures. The FOC vessels have on various occasions prevented their crew from joining various bodies that will definitely help their seamanship career. A ship owner or manager can also abuse the process of payment of their employees or crew of the vessel if the vessel is an FOC vessel. The rules followed by an FOC vessel covertly permits the employers of an FOC vessel to short pay the vessel crew, amongst others. There have been several cases where vessel crews were not paid their actual salaries or their payment being unduly delayed.

Going forward, the practice of FOC in the maritime industry or merchant shipping needs to be reviewed with certain debilitating clauses expunged. The FOC vessel poses a serious threat to the crew and the world’s waters. However, the earlier we also come to terms with this phenomenon the better for the maritime industry and business at large. Thank you for your time.

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Adekunle Segun is a maritime industry expert and writes in from Lagos, Nigeria. He can be reached via adekunleolusegun450@gmail.com; +234 8163769265 (SMS only)