Marshall Islands Registry firmly establishes itself as a major flag-state with growth in new shipping markets

The Marshall Islands Registry has firmly established itself as a major flag-state which offers a comprehensive set of services and maintains a global presence. It’s also among the top five registries of choice among Hellenic ship owners. In an interview with Hellenic Shipping News Worldwide, Mr. Theofilos Xenakoudis, head of the Registry’s office in Hellas, talks about the Registry’s presence in Hellas and internationally, as well as its growth plans. He also informs us about the latest developments from a regulatory point of view.

How has the 2012 year progressed for the Marshall Islands Registry in terms of new tonnage added?

At the end of 2012 the Republic of the Marshall Islands (RMI) Registry had 2,798 vessels and 88.65 million gross tons (GT). In comparison with the beginning of 2012, we have sustained a growth of almost 10% in terms of total number of ships and 13% with respect to the overall tonnage figures. As of the end of August 2013 there were more than 2,950 registered vessels and 95 million GT.

In terms of Hellenic-based clients, how did the Registry perform and where does it stand in terms of market share among the Hellenic shipping companies?

The Piraeus office has a long-standing relationship with the Greek owners and we continue to attract new tonnage. As of the end of the second quarter of this year, Greek owned vessels in the fleet amounted to nearly 20 million GT, which is 21% of the total fleet. Based on recent reports, the RMI is among the top five flags preferred by Greek shipowners and operators and is one of the fastest growing foreign flags in the Greek market.

In terms of international presence and services provided, which have been the main initiatives from Marshall Islands Registry this past year?

In terms of new developments, the RMI Registry is growing in the offshore and energy sector. During the last five years, the Registry’s offshore fleet has grown by more than 70%. According to Clarkson Research Services Limited, as of 1 July 2013, the RMI is the third largest flag State in terms of GT with respect to offshore vessels.
To meet the demand for services in the offshore sector in Brazil, an office was opened in Rio de Janeiro last year. The Registry continues to expand the Houston office capabilities by adding additional personnel with expertise in the offshore industry.
Opening the Rio de Janeiro office took the Registry’s global network to 25 full-service offices. In addition the Registry’s focus on marine safety, security and environmental compliance, which are critical issues to shipowners and port State control (PSC) jurisdictions, it is also imperative that flag States are able to provide timely support to ensure compliance and avoid unnecessarily port delays.
From 1 January 2010 through 20 August 2012, the RMI conducted a period of voluntary compliance for inspection and certification provisions of the Maritime Labour Convention, 2006 (MLC, 2006). From 20 August 2012 forward, special focus and attention was given to the implementation of the MLC, 2006, which as you know entered into force on August 20th this year. Providing assistance to our operators regarding the certification process, liaising with Recognized Organizations and finally educating our marine safety inspectors worldwide, in order to inspect the ships against the MLC, 2006 requirements was a key focus in 2012 through the entry into force date.

Has the economic crisis in Hellas affected your local business? When do you expect a recovery?

Greek owners have the experience and expertise to manage their businesses well during the boom times and economic downturns. They have been involved in many global economic cycles during the last 40 years.
From my perspective, I think that the global nature of shipping means that economic recovery in Europe and the US will in turn stimulate trade and shipping across the tanker, bulk and container sectors. As Greek owners have significant presence in these sectors they will also benefit.

Needless to say that competition among registries is ever so growing in today’s challenging shipping markets, where ship owners are looking for ways of cutting operating expenses. How has this shaped the role of shipping registries in this difficult environment and what measures has the Marshall Islands Registry adopted in order to increase its competitiveness?

International Registries, Inc. and its affiliates (IRI), who provide administrative and technical support to the RMI Registry, is the world’s most experienced, privately-held maritime and corporate registry service provider specializing in the needs of the shipping and financial services industries across a broad commercial and economic spectrum. IRI has been administering maritime and corporate programs and been involved in flag State administration since 1948. With the introduction of decentralized registry operations and services, we have been able to more efficiently provide services to local markets which in turn saves time and money for the operator when they are able to receive a response from the Registry in their time zone and in the local language. From its inception, the greatest advantage of the RMI Registry and what sets the Registry apart from others is the service it provides to clients. In order to achieve this, Registry personnel have developed relationships with regional PSC officials, Classification Societies, appointed representatives and other industry stakeholders in order to maintain an active dialogue and ensure pertinent information is communicated to those vessels flying the RMI flag. Timely Registry support is available from the Registry’s staff of over 200 qualified and experienced mariners, naval architects, engineers, surveyors, nautical inspectors, marine safety and environmental protection experts, PSC officers, shipping company administrators, radio specialists, and casualty investigators, among others.
One key area to mention is new technology, like Long Range Identification and Tracking (LRIT), which provides Registry personnel with the ability to closely monitor the location of the fleet. Marine safety personnel utilize this technology to conduct a risk assessment on vessels coming into a port and where necessary, carry out special inspections to ensure a vessel is not unduly delayed in port. This is of course in cooperation with our operators. Moreover, we have established a fleet assessment method, which is reviewed and updated on a monthly basis, in order to ensure that all of our ships are meeting the international standards; this is a tool that gives to our marine safety department the ability to identify “weak” points, ships and operators that may present some problems, in order to work with them and in full cooperation resolve any issues.
The RMI Registry strongly encourages good communication and transparent cooperation with our clientele; and that is the level of quality that clients appreciate.

These days, a registry’s quality is among the main parameters for its success. How does Marshall Islands fare in this area?

The RMI Registry has built an excellent reputation with respect to its PSC record and is white listed with all major memorandums of understanding (MoUs), including the Paris and Tokyo MoUs, and has continued to meet the high standards of the United States Coast Guard Qualship 21 program for nine consecutive years. In addition, the RMI meets the flag criteria for a Low Risk Ship under the Paris MoU New Inspection Regime.

Currently, the issue of “green” shipping is among the most prominent in the business. How do you think the new rules and regulations are going to impact ship owners and how are you planning to help them, given that over the course of the past 12 months, there have been radical developments regulations-wise?

The RMI is working very closely with owners and operators to make sure they have the information they need to ensure their vessels are compliant. For example, the International Convention for the Control and Management of Ships Ballast Water and Sediments, 2004 (BWM 2004) is of concern to our owners and operators. To date, 26 Member States, with a combined merchant shipping tonnage of 29.07% of the required 25% of the world’s total fleet, have ratified. In order to assist our owners and operators in better understanding regulatory changes like BWM 2004, we have been holding regional seminars. We recently held a seminar in Piraeus in April of this year on BWM 2004 and MLC, 2006. In addition to holding seminars specific to upcoming regulatory changes that may impact our owners and operators, the Registry also publishes Marine Notices and Guidelines on topical issues. Greek shipowners are the largest shipowning group in the Registry. Given our active dialogue and long-standing relationship in this market, these seminars are well attended. While not all issues are resolved during these sessions, they do connect the key regulatory personnel on the topical issues and begin a positive dialogue. On the other side of this we also have an active Marshall Islands Quality Council that formerly meets two times per year to discuss impending regulatory issues and provide advice and guidance to the Registry. These discussions assist the RMI’s delegation at the International Maritime Organization (IMO) to better understand and communicate, on the international level, how these regulations can be implemented by owners and operators.

Another pressing issue is the one of piracy. Which are the guidelines you follow when a ship is been hijacked or attacked and what type of support do you offer to clients?

To avoid hijacking, the RMI Maritime Administrator (the “Administrator”) provides regulation, guidelines and ship security alerts to apprise owners and operators with the latest of intelligence, practices and official points of contact with respect to piracy. The Administrator maintains a strict policy on the use of private contracted armed security personnel (PCASP). Although the Administrator does not object to vessel owners, operators, and/or Masters taking appropriate measures in regard to the safety and security of their vessels and crew, the decision to hire an armed security detail is left to the vessel owner/operator to decide upon after assessing the piracy related risks in the area where the vessel will be operating, as well as the potential risks and benefits of available anti-piracy related countermeasures as described in Best Management Practices for Protection against Somalia Based Piracy (BMP4) and the Interim Guidelines for Owners, Operators and Masters for Protection Against Piracy in the Gulf of Guinea Region.
This risk assessment is required to be made in accordance with the IMO MSC.1/Circ.1405/Rev.2 guidelines regarding the use of PCASP and could include discussions with charterers, legal counsel, underwriters, labour representatives, and port officials. If so decided, a formal request must be made to the RMI Maritime Administrator after which a thorough vetting of the private maritime security company (PMSC) operations, PCASP personnel, weaponry inventory, ship’s current location and itinerary, compliance with port regulations, etc. is conducted before a letter of no objection is issued.
The RMI Registry has a dedicated team of worldwide personnel that respond to ship security related inquiries and incidents ([email protected]). Should a vessel be attacked or hijacked, the Administrator immediately coordinates with the shipowner and official authority points of contact. Aggressive LRIT tracking and information sharing is commenced and maintained until the incident is over. A post incident investigation is made and the results reported.

Nikos Roussanoglou, Hellenic Shipping News Worldwide