Panos Kirnidis, CEO at Palau International Ship Registry
Paris MoU blacklist status is stopping the growth of new registries, is anti-competitive, and has become a vicious cycle. It takes time for a new registry to build trusted relations with shipowners and stakeholders in the industry and to show its values. Consequently, the fleet may start as one of older – although not substandard – vessels and numbers will not match those of the established registries. However, there is a higher risk of those older ships being detained.
The flag of Palau was placed on the Black List is as a result of 123 inspections and 23 detentions from 2014 to 2016. The number of detentions is correct but in 2014 we had only three; in 2015 we had five; and in 2016 we had 15. These simple figures are used in a mathematical calculation that singularly fails to recognise, and address, the significant problems that have been created in certain maritime areas and that eight of our detentions were in the Sea of Azov area bordering Russia in just 30 days.
Without these eight detentions, Palau would be still in the grey list of the Paris MoU. Unlike larger registries, in terms of fleet size, Palau cannot afford eight detentions as we would need more than 100 clean inspections to clear them from our record. Moreover, such corruption issues will always exist until we revisit and redesign a proper port state control inspection code.
The Paris MoU needs to modernise to ensure there is fair play and incentives to grow the industry. There must be a co-ordinated effort on behalf of registries to rewrite the system and the formula and develop new entrants to the sector. It can only be to the benefit of the sector overall.
We have been in discussion with a number of other flags and senior people from the sector who back our stance. These include HEL Parenté, Vanuatu ambassador to the IMO, who joins us in calling for a reform of the lists. The support is growing as many smaller registries realise they are sailing against a tide that seems determined to hold back their growth.
Response from Richard WJ Schiferli, secretary-general of the Paris MoU
The number of detentions the flag of Palau has had over multiple years qualifies Palau as a ‘high risk’. Most of the ships that have been inspected and detained are 25–50 years old and are therefore more likely to have a large number of deficiencies. The detention percentage of Palau flagged ships is almost 20% over the past four years.
However, the flag is only one element to determine the risk profile of a ship. A ship’s risk profile is recalculated daily, taking into account changes in the more dynamic parameters such as age, the 36-month history, and company performance. Therefore, the arguments used by Palau are not valid, in particular since other smaller registers have managed to be placed high on the white list.