Institute of Chartered Shipbrokers
London & South East Branch

Flag states under the spotlight

by Richard Scott FICS, member of London & South East Branch Committee, 12 February 2021
 
At the end of January the International Chamber of Shipping published an updated 2020/21 edition of its Shipping Industry Flag State Performance Table. This annual survey aims to give an overview of how ship registry countries are meeting various standards which are signs of a flag’s quality, and therefore value to shipowners.
 
The survey covers aspects such as port state control records, ratification of international conventions, and attendance at International Maritime Organization meetings. Data in the latest edition is the most up-to-date available as of January 2021.
 
As emphasised by this information, there is a wide range of performance among the many flag states participating in the global shipping industry. The Chamber comments that “the level of performance of many of the largest flag states – including Marshall Islands, Hong Kong, Singapore as well as the Bahamas and Cyprus – continues to be very positive”. 
 
Another comment is that among the ten largest registers (measured by deadweight tonnage), comprising more than two-thirds of the world fleet, “none have more than two indicators of potentially negative performance, and five have no negative indicators at all”. Yet elsewhere there are clearly performance shortfalls and the Chamber observes that “a number of flag states still have a lot of work to do” to ensure adequate standards are achieved.
 
In the past, the flag category known as ‘open registries’, the preferred name replacing ‘flags of convenience’ has attracted much criticism, especially when registered ships were involved in pollution or other incidents. But many open registries now achieve remarkably high standards, and the Chamber suggests that distinctions between these and so-called ‘traditional’ flags are no longer meaningful.
 
The purpose of the performance table is stated by the Chamber as twofold. First, encouraging shipowners and operators to look critically at what flag states are offering; and second, encouraging owners and operators to put pressure on flag administrations to raise standards when necessary.  
 
The full International Chamber of Shipping report is available at: