Overview: Shipping and Maritime Laws (Part 1)

Introduction

Travel and transport by the sea is the earliest recorded channels of commerce. Dispute resolution that involved maritime trade was developed much earlier in history than any other. Maritime law has undergone significant transformations since then. Though each nation has its own legislation governing maritime matters, it is imperative to note that a considerable part of this field of law is influenced by international law which includes multiparty international treaties.

I intend to start a maritime business venture and plan on buying new ships. How do I go about the registration process?

The UAE Maritime Trade Law (Federal Law Number 26 of 1981, as amended) (the Law) regulates all shipping practices within the United Arab Emirates. The Law prohibits ships to fly the flag of the UAE unless such ship satisfies the conditions imposed under Article 18 to Article 37. That said, certain categories of ships are exempted from registration procedures. Pursuant to Ministry of Communications Decree number 110 of 1998, foreign vessels that are more than 20 years old from date of construction are prohibited to operate on UAE territorial waters. Both national and foreign vessels must have a general and valid insurance policy to classify for operation in UAE. The Marine Affairs Department at Ministry of Communication oversees the registration process and affairs related to maritime industry. Fishing ships, pleasure liners, or commercial ships that weigh less than 10 tons are exempted from register. Also, vessels, barges, lighters, tugs, boats, cranes, diver's boats, freighters and other floating installations within UAE's ports are also exempt from registration. Tankers that are over ten years old cannot be registered.

Article 27 of the Law sets out the registration procedure and requires every applicant to submit a)name of the ship; b) former names of ship (if any); c) date and place of building, name and address of factory or shipyard where the ship was built; type of ship, loading capacity and related measurements, d) names of owners, their occupation, religion, nationality, and address, e) name of owning company, company's business activity, its headquarters, details of management, f) name of ship master, his nationality, residence and qualifications, g) name of carrier and related details, h) mortgage details, etc.

In a recent decision by the executive council resolution number 11 of 2013 issuing the implementing bylaw of law number 11 of 2010 concerning the licensing of vessels in the Emirate of Dubai, the role of Dubai Maritime City Authority has been strengthened, allowing it to set out licensing framework for vessels operating within the territorial waters of Emirate of Dubai. The decision also encompasses matters relating to transfer of vessel ownership, amendment of license, license cancellation, loss or damage, etc.

And will my vessel automatically acquire UAE nationality?

In line with provisions contained in Article 14 of the Law, a ship acquires UAE nationality if it is registered within UAE’s ports or is owned by individuals or a company possessing the said nationality. As long as corporate entities maintain the respective shareholding structure set out under UAE Commercial Companies Law (Federal Law number 8 of 1984, as amended), ships registered under such entities can acquire UAE nationality. In cases where ship is owned by a body corporate wherein more than one state has shares in company’s capital, the ship in such event acquires nationality of partner states in accordance with the international treaties. Ships that have been confiscated for breach of law and stray ships will automatically acquire nationality.

What employment laws will regulate my crew?

Article 165 of the Law sets out that “the rights and obligations of the crew shall be defined in the bylaws in force on the vessel, in such a manner as is not contradictory with the contracts of employment made therewith”. With the exception of overtime provisions, UAE Labour Law (Federal Law number 8 of 1980) governs employment aspects.

And the master? Who can appoint and dismiss him? What are his powers and obligations?

The master shall be appointed or dismissed by the operator. The Law sets out that the master shall be solely in command of the vessel comply with the directions of the operator, and direct the sea voyage. When in command of the vessel the law provides that the master shall take into account technical principles accepted in navigation by sea and international conventions, and the provisions in force in the State in whose waters the vessel is located. The master also must maintain the vessel in seaworthy condition and ensure that there are sufficient supplies for the voyage. The master must personally take over the direction of the sailing of the vessel upon the entry or exit of ports, anchorages or rivers, and generally in all circumstances where navigation is subject to particular difficulties, even where he is required to seek the assistance of a pilot. The master also shall have the power of authentication of documents and carry out all the administrative questions on board the vessel and is also entitled to impose disciplinary penalties in accordance with the rules and conditions set forth by ministerial resolution.

What are my rights and duties if I sign a maritime transport contract?

A contract of maritime transport is a contract whereby the carrier undertakes to carry goods from one port to another for consideration agreed between the carrier and the shipper. The same must be evidenced by a bill of lading and the carrier of his representative must issue a bill of lading upon the request of the shipper. The bill of lading must set out relevant details as to the contract including but not limited to the name and address of the carrier, the shipper and consigner, port of loading and port of arrival, place of issue and date of the bill.

What happens in case of accidents or collision?

Article 318 to Article 326 of the Law regulate and cover aspect pertaining to accidents or collisions. The UAE Civil Code also covers matters relating to collision. This question however will be discussed in a greater detail in my next article.

The UAE Maritime Code provides that in case of collision between maritime vessels, or between such vessels and boats navigating in the domestic waters, compensation due for damages incurred shall be settled in accordance with the provisions set in the same Code, without regard to the legal system of the water where the collision occurs. 

What happens if one of my sailors get injured during the course of the voyage?

If one sailor is injured or contracts any illness while in service, the operator must provide treatment, free of charge, and will be entitled to his full wage during the voyage, being the Labour laws on the matter applicable after its end.

Even if he was drunk and entered into a fight with another sailor during the voyage?

If the sailor got injured because of the fight, the operator must provide treatment, having the latter the right to deduct the costs of the treatment from the wages owed to the sailor. If he doesn’t get better, he won’t be entitled to any other wages but the days already worked. If he dies, the operator must pay his funeral costs regardless of the cause of death.

And which criminal law will be applicable?

The UAE Penal Code, as per its article 17, second paragraph, states that it shall apply also to the commercial ships and aircrafts bearing the state flag.

Is there in UAE any special maritime court? To which Court shall I apply if I have any problem?

No, there is no Maritime Court in UAE. Actually the Courts are handling all the maritime cases. Generally the Courts ask assistance from experts in maritime disputes.