Offshore Registration of Shipping (Hansard, 1 December 2003)

§ Lord Wallace of Saltaire
asked Her Majesty's Government: Whether they are in favour of any change in the current international regime for offshore registration of shipping.

§ Lord Davies of Oldham
My Lords, the straightforward answer to the noble Lord is no. Shipping is a global business subject to international regulation in relation to its safety, security and environmental performance. The place of registration of shipping is secondary to ensuring that, whatever the state of registry, it accepts its responsibility for ensuring that all ships on its register comply with internationally agreed safety, security and environmental standards.

§ Lord Wallace of Saltaire
My Lords, I express my acute disappointment with that Answer. Does the Minister agree that, with the Financial Action Task Force, the Government have worked actively to tighten regulation on offshore financial centres, which leaves the offshore registration of shipping as one of the great unregulated areas of international commerce? Is he aware that funds for shipping in Liberia were for two years going straight into the pocket of Charles Taylor during a civil war? Is he aware that, under current rules, beneficial ownership of ships on the high seas may be virtually impossible to discover? Does his reply suggest that the Government are not strongly supporting the current OECD initiative?

§ Lord Davies of Oldham
My Lords, the Government are taking the OECD initiative seriously—and, indeed, pre-dated that by participating strongly in initiatives that guarantee increased security of shipping in relation to these shores. The noble Lord will be aware of European requirements with regard to port of entry. The problem with place of registration— or flag of convenience—is straightforward. First, some such states have a better record on security than more traditional maritime nations. Secondly, the question of ownership can easily be covered by charters and forms of registration but, in a global economy, trying to control flag of convenience is not the route forward.

Lord Campbell of Croy
My Lords, are the Government satisfied with registration under what are known as flags of convenience, which have involved Liberia and Panama, for example, and have enabled ship owners to avoid inspections for seaworthiness and fair treatment of crews?

§ Lord Davies of Oldham
My Lords, as I said, we are concerned with tackling the issue of sub-standard ships wherever they are registered. Not all sub-standard ships are registered in the less traditional maritime countries. So the whole effort of the international community through the International Maritime Organisation is less concerned with trying to control registration, which is difficult to achieve in a global economy, than with insisting on standards that ships must reach in order to enter ports. We are playing a leading part with the International Maritime Organisation to tighten those controls, not least in the post-September 11th context, to address the question of the security of such ships entering ports.

Lord Berkeley
My Lords, does my noble friend agree that rather than international regulation of ships, it appears to many people on the outside that the law of the jungle is working? He talks of enforcement, but what enforcement has been imposed and by whom about the oil tanker that sank last winter off Portugal, or the car-carrying ship that sank in the Dover Straits and was run into by three other ships because people were not looking where they were going? What real enforcement is there? Will not action be taken only when there is another major accident in European waters?

§ Lord Davies of Oldham
My Lords, my noble friend raises an important point. As for the "Prestige", the tragedy that befell the whole fishing industry off the Spanish coast and the great dangers created by that tanker, there is now international action to guarantee that single-hulled ships are phased out and that we have added protection against oil leakages from ships which get into real difficulty. That is on the basis of international action through the International Maritime Organisation, which is the basic forum in which this country and all others must make progress to guarantee safety at sea.

§ Lord Avebury
My Lords, does the International Maritime Organisation prescribe minimum standards for the rates of pay, conditions of work and training for seamen on the ships concerned? If not, should it?

§ Lord Davies of Oldham
My Lords, the issues of minimum pay and standards are more difficult, but I assure the noble Lord that the International Maritime Organisation is very concerned that the level of training for crews should be examined, because there is no doubt that when accidents happen at sea, they often occur because the crew is not as well equipped to deal with emergencies as should be the case. That has been the main focus of the International Maritime Organisation.

§ Viscount Simon
My Lords, is my noble friend aware that in Australia, all ships, I believe, that enter are examined for any failures in their efficiency to operate and are impounded until they comply? Do such systems exist in this country or are there any plans to introduce them?

§ Lord Davies of Oldham
My Lords, I reassure my noble friend that the concept that he has outlined of how Australia operates is similar to that which is being developed in Europe—namely, that port authorities have the right to assure themselves that any ship arriving at the port meets standards and requirements. I can give my noble friend clear reassurance on that.

§ Lord Wallace of Saltaire
My Lords, is the Minister aware that the OECD initiative on the Financial Action Task Force simply ranked offshore financial centres as A, B or C, with a recommendation that serious banks should not treat with those in category C? Could not the same be done for offshore shipping registration?

§ Lord Davies of Oldham
My Lords, the noble Lord invests the OECD report with greater salience than it deserves at this stage. The OECD has said that it wants to engage in additional consultation before it formally publishes the report, recognising the real difficulties that obtain with regard to international shipping. The Government will of course take seriously the need to play our part within the OECD to ensure that any such report is considered with due thoroughness.