Madam, - Ireland is among the nations of the world that have ratified the United Nations Convention on the Law of the Sea (UNCLOS). Among its provisions are measures providing for the registration of commercial ships.
Under article 91, registration of a ship confers on it the nationality of the country where it is registered and provides that, that country must "exercise its jurisdiction and control" over the ship in all "administrative, technical and social matters".
Therefore, the ship takes on board all the relevant laws, including safety, security and environmental protection laws and regulations, as well as any worker protection legislation, that exist on the statute book of the country of registration.
Fortunately, the vast majority of sea-going commercial ships are actually owned in the developed world, where the best laws and regulations are in force.
Unfortunately, the owners of some commercial ships are obsessed with maximising profits and have a rather cavalier attitude to laws and regulations. Consequently they avoid registering their ships in their own country and instead they register them elsewhere under the notorious Flag of Convenience (FoC) system.
In simple terms they choose a country whose only interest is to make money out of collecting registration fees and which has little interest in enforcing regulations on ships operating under its flag. The result is that the shipowners are more or less free to do as they please and there are many well-documented dire consequences, not least in the widespread abuse of many of the unfortunate crews.
One would expect that Ireland would do nothing that would legitimise, or give respectability to, the FoC system. Rather surprisingly, that is not the case. Under the Provisions of the Finance Act 2002, the Government, in order to attract investment in the Irish shipping industry, introduced a special tax incentive scheme popularly known as "tonnage tax". In principle, it is a good scheme that has attracted investment and created jobs here in Ireland.
Sadly, however, the criteria set out by the Government to allow ships to participate in the scheme fall short of what is needed. The Irish system insists only that the strategic and commercial management of ships be based in Ireland. There are no requirements regarding where the ship is registered and whose flag it operates under.
Therefore, the Irish system ignores the hugely important fact that it is where the ship is registered, and not where its strategic and commercial management is based, that sets the legal character of its everyday operation. Indeed the Government, in not having regard to where the ship is registered, is in fact ignoring Article 91 of UNCLOS.
The Minister for Finance recently confirmed in the Dáil, that there were about 100 ships operating under the "tonnage tax" scheme, but claimed that "confidentiality" prevented him from revealing the identity of these ships. As there are only around 40 commercial ships operating under the Irish national flag and a handful more that we know of operating under the flags of other EU states, this can only mean that many of these 100 ships are availing of the Irish "tonnage tax" scheme, while operating under the notorious FoC system.
Our ports and shipping industry are of crucial importance to the Irish economy. About 96 per cent of all our traded goods, both exports and imports, must be carried on ships. Yet in recent years we have not even had a Department of the Marine any more, or even a Minister of State who is answerable to the Irish people and Dáil. Rather alarmingly, all we have these days to deal with Marine issues, is a small and rather inconspicuous section within the Department of Transport. - Yours, etc,