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Ownership and Nationality of Ships Explained

Learn about the significance of ship ownership and nationality, including registration requirements and the concept of a genuine link, as outlined in international law.

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Ownership and Nationality of Ships Explained

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  1. OWNERSHIP AND NATIONALITY OF SHIPS Chapter3

  2. A ship is a special movable property with peculiar features. The right of ownership of a ship is equivalent to ownership of movable goods. Ships need to have nationality. This distinguishes them from other special moveable properties. Cont…

  3. One may ask why ships need to be registered. the following are the reasons why ships, unlike other movable things, are subjected to the requirement of nationality. Ships…being large and valuable asset, and can disappear from one side of the world to another, escaping jurisdictions. Cont…

  4. Also, they are potentially the means by which their owners can incur liabilities to third parties –sometimes of catastrophic proportions. It is, therefore, logical that ships should be given a nationality so that their owner’s obligations, duties, rights, liabilities, immunities, etc., can the more easily be regulated and recognized. Cont…

  5. The term ‘nationality’ describes the legal relationship between a state and a ship authorized by the state to fly its flag. In other words, the nationality of a ship refers to the state which has authority and responsibility over the ship as symbolized in the flying of a national flag. The ascription of nationality to a ship is one of the most important means by which public order is maintained at sea. Cont…

  6. States usually grant their nationality to vessels by means of registration and by authorizing vessels to fly their flag. Though each nation has the right to confer its nationality on a ship and to prescribe the rules governing such grants, international law has developed certain limitations. Cont…

  7. One of such limitations is the principle of “genuine link”. The principle of genuine link prohibits states from granting nationality to ships lacking “genuine link” to the state. The elements of genuine link vary among nations, but often include: ownership by nationals, national crew, and national built. Cont…

  8. UNCLOS, as the universal law of the sea accepts that conditions for the granting of nationality are clearly within the domain of domestic law: “Every State shall fix the conditions for the grant of its nationality, registration of ships and right to fly its flag.” Cont…

  9. This means that requirements to register a ship, such as ownership, nationality of crew, or domicile of the ship-owner, should not, according to UNCLOS, be regulated internationally. Thus, it is clear that each state under international law may determine for itself the conditions on which it will grant its nationality to a merchant ship. No one is in power to question the regularity and validity of a registration except the flag state itself. Cont…

  10. This loophole is, however, manipulated by some states that are later named flag of convenience or open registries. Over the past few decades, the use of flag of convenience has grown from a small to a large percentage of shipping worldwide. Cont…

  11. Ship owners in traditional maritime nations opt for flag of convenience to avoid the stringent safety and labor regulations in home country and to benefit from easy access to registry and low tax schemes. Whereas, host countries are motivated by the financial advantages the practice generate to their economy. Nonetheless, the bad sides of the practice are more evident than its good sides. Cont…

  12. Apart from being owned by qualified persons, the vessel is expected to have the technical competence to provide the intended services Most importantly, the ship-owner has to complete the vessel crew in conformity with relevant national and international standards. Registration of vessel

  13. Nationality and registration might not be required for all vessels. Some jurisdictions do not require registration for small vessels. The English Merchant Shipping Act of 1894 exempt [from the obligation to register] ships not exceeding 15 tons burden employed solely in navigation on the rivers and or coasts of the United Kingdom. Sweden, on the other hand, has a ship register for Swedish vessels over twelve meters long and over four meters wide. Cont…

  14. the documents required and kept by the registrar, in most cases, include title documents. Apart from this, documents evidencing the time and place of building of the vessel are required. Cont…

  15. Finally, the marks of the ship –the name and official tonnage –are entered into the register. In short, documents evidencing title to the vessel, statements as to the time and place of building are the major contents of the registration. Cont…

  16. Once the ship is duly registered, a certificate of registry is issued which is usually kept on board ship. Any vessel registered by the Authority has to pay to it (1) annual charges levied by the Authority, (2) service fees, and (3) vessel registration fees Cont…

  17. A vessel is removed from the Register if the ship is sold to a foreigner, or has been lost. In contrast, in flag of convenience states, a vessel is removed from registers even when the owner has requested so. Under maritime law registration seems to be an obligation, not a right. An owner who intentionally avoids registration of a ship which is subject to registration will be guilty of a criminal offence copy

  18. MARINE INSURANCE chapter4

  19. simad Insurance contract Premium (consideration) Insurer Insured/Assured (Proponent) Promise of payment by the insurer • The proposal is the offer. • The policy is evidence of the contract.

  20. Insurance and assurance: The term insurance refers to events or incidents which may or may not occur, e.g.: fire, theft, accidents and the like. Assurance on the other hand refers to incidents which are bound to or that must happen, for example, death, and old age. insurance

  21. The amount of money to be charged for a certain insurance is called the premium. Risk management is the practice of appraising and controlling risk that has evolved as a discrete field of study and practice. The transaction involves the payment to the insurer in exchange for the insurer’s promise to compensate the insured in the case of financial loss. Continue….

  22. Marine insurance, though legally undefined, could generally be understood as insurance aiming to guarantee a maritime risk. Depending on the types of coverage or the subject matter insured, marine insurance can be categorized into hull insurance, cargo insurance, freight insurance, and liability insurance. Cont…

  23. It should also be noted that there are numerous special coverage, such as pollution insurance. The purpose of a hull policy is to cover damage to or loss of a vessel sustained by shipowners. Cargo insurance policies often cover, for the shipper/consignee, the goods from maritime risks. Cont…

  24. Freight insurance comforts the loss of freight by ship owners or any other managers. Liability insurance, on the other hand, indemnifies a vessel owner for liabilities incurred to third persons – these liabilities include personal injury and death, property damage and damage to cargo. Cont…

  25. Insurance policies may be classified into voyage, time, and mixed policies depending on the time during which the maritime risks are covered. In a voyage policy, the subject matter of the insurance is covered during a voyage (voyages) from a designated place to another. voyage policy : is were the owner of a ship insures it for a particular journey. Voyage Policies, Time Policies, and Floating Policies

  26. Insurance obtained to cover risks from one date to another is called a time policy. Time policy covers losses that may occur within a specified period say the 1st January to 31decembber,2018. Time policies do not usually exceed one year. Cont…

  27. Under a mixed policy, the insurance is taken out for certain period of time during a particular journey. mixed policy covers losses on a particular route for a specified period. Cont…

  28. The commencement of risk varies with the type of policies issued. Incase of time policies, we need not worry about as to when risk starts running and comes to an end. Cont…

  29. Consequently, the law does not prescribe any rule relating to the beginning of risk for time policies. The dates set in the policy are more than enough in telling the time when risk starts running and comes to an end. Cont…

  30. Rules relating to the commencement of risk for voyage and mixed policies are,however, provided in the Maritime Code. If hull insurance is taken out for avoyage, the risk runs from the time when the shipment of cargo commences andends at the termination of unloading provided that the duration of risk may notexceed a period of 15 days after arrival at the destination. Cont…

  31. In case of cargo insurance taken out for a particular voyage, the risk runs from the date when the goods are delivered to the carrier until the time when the goods are delivered to the consignee at the last place of arrival. Cont…

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