Official: Despite Publicity, Ship Registry Needed

For a nation with just one seaport, Cambodia has made plenty of maritime news in the past few weeks, none of it welcome.

First there was the February fiasco of the East Sea, a ship that flew a Cambodian flag as it dumped 900 Kurdish refugees on the shores of southern France, the result of a human smuggling operation gone bad.

Then there were the less-publicized sinkings of two more ships flying the Cambodian flag, one in the Straits of Taiwan earlier this month in which eight sailors disappeared or were found dead, and the other on Wednesday off the coast of China.

Not a banner spree for Cambo­dia’s maritime legacy, but it represents the sort of bad news Khek Sakara has become accustomed to as the chairman of the Cambo­dian Shipping Corpor­ation.

His is the private company that sends Cambodian flags to ship owners so that they may sail in international waters. A country’s flag is required by international maritime law and signifies that the ship has passed that nation’s inspections and is seaworthy.

The Cambodian Shipping Cor­poration has a 10-year contract with the government, tracking 500 to 700 ships on the nation’s reg­is­try. Every time one of the ships encounters trouble or fails an inspection in some distant port, Khek Sakara hears about it.

“As you can imagine, with 500 boats you have problems nearly every day,” he said.

Ship owners turn to Cambodia because it offers an open ship registry—known as a “flag of con­venience” by critics—with fewer restrictions than more established registries such as that of the US.

Ship owners have many reasons to turn to open registries, from lower taxes to fewer restrictions on the nationality and pay of crew members. Open registries have earned the scorn of more established registries, since they draw business from other countries and sometimes allow unsafe or even illegal boats to operate in international waters.

In exchange for the right to fly the Cambodian flag, ship owners pay anywhere from a few hundred dollars to several thousand dollars. The lucrative practice brought in almost $90,000 last year in government fees, Khek Sakara said.

The registry is growing—an online registration site developed last summer, the world’s first, has drawn more ship owners. But as recent events show, the practice is not without risks.

“Nearly every day I am getting calls, ‘Is this your ship?’” said Khek Sakara.

It was his duty after the East Sea refugee scandal to work with Interpol and the French police to identify the ship’s owners. He learned in his investigation that the ship had been sold by the person who had it certified, and that the new owner had not registered with Cambodia but continued to fly the flag illegally.

This week he was investigating the sinking in the Taiwan Straits to see if the ship was legally registered in Cambodia.

The malfeasance committed under the Cambodian flag is not good advertising for the country, Khek Sakara acknowledged, but the ship registry brings much needed cash to the desperately poor government.

The first person to hear of ship troubles is often Nun Sakhan, the deputy director of the merchant marine department at the Ministry of Public Works and Transport.

In 1999, he was notified of 88 ships that had failed some portion of international inspections required by the International Maritime Organization (IMO). The inspections usually check for adequate lifeboats and fully functioning engines.

The ship’s owners are forced to make the needed repairs before they can leave their port.

“With the detentions, we try to resolve the problems as quickly as possible,” said Khek Sakara.

Still, there are plenty of accounts of Cambodian ships encountering calamity on the seas to warrant concern.

This past week it was the Amber, which sank off of the coast of southeast China on Wednesday. All eight crew members were rescued but 1,700 tons of steel cargo was lost.

In the Taiwan Straits on March 8, a Russian ship called the Pamela Dream sunk, carrying a load of mahogany and five seamen to the bottom. Rescue officials could not locate the ship or the missing seamen, and theorized that the ship‘s cargo had shifted in route, sinking the boat.

A disastrous sinking of a ship flying the Cambodian flag in August 2000 saw 700 tons of oil spilled into the waters off the coast of Greece. One sailor died and three others were injured. A month later, three more men were arrested for making up a false insurance certificate on the ship.

Last year in March, a Cambodian-registered ship was impounded in Italy. The 68-meter vessel, carrying 1,108 tons of wood from Romania and 14 crew members, was stopped for violations of maritime security. The ship was sequestered and inspectors found 47 violations of international maritime regulations.

And on Jan 5, 2000, a Ukrainian crew sailed into a storm in the Black Sea and sank their vessel, which was carrying the Cambodian flag. One sailor was missing and 11 were rescued.

All of these vessels were registered under the Cambodian ship registry, founded in 1994 by Khek Sakara’s father, Khek Van Dhy, a Funcinpec member of the National Assembly. Khek Van Dhy turned to private businessmen in Singapore to help with the operation of the registry, leading to the creation of the Cambodian Shipping Corporation, contracted to operate the ship registry until the end of 2003.

The company keeps 85 percent of all revenues, but also pays taxes to the IMO in London and fines—some $57,000 last year—for violations of maritime codes and laws committed by ships on the Cambodian registry.

Such public-private partnerships are not unheard of: Liberia and Panama both operate registries with the help of companies based in the US, allowing the private companies to keep a portion of the profits in exchange for their service.

The Liberian ship registry had a generally clean record, listing the second-highest number of ships in the world, before civil war erupted in that country several years ago.

Panama, the world’s largest open registry with some 13,000 vessels, has had more trouble. US Coast Guard officials complain that the ships are not always properly inspected.

The IMO maintains a so-called “white list” of countries that have signed all international treaties for registering vessels. Those countries not on the list are said to be on a black list.

Cambodian officials have yet to sign required treaties on pollution and protection of fishing areas to get on the white list.

Khek Sakara said signing the treaties costs money since they make the country liable for violations committed by its ships. The $57,000 paid last year in fines would have been 20 percent to 30 percent higher if all of the treaties had been signed, he said.

Signing the treaties is an important step towards legitimacy, however, and Khek Sakara said he expects officials at the ministries of foreign affairs and transport to sign the treaties within the next few months as the registry earns more fees.

To avoid problems, the Cambodian registry sometimes turns away vessels that do not meet its standards, said Khek Sakara. Inspectors in most major ports around the world can be hired to inspect a vessel before granting it a place on the Cambodian registry. Ships can also lose their certification for poor conduct.

When officials from the environmental group Greenpeace discovered a fishing boat catching Atlantic tuna illegally, they notified Khek Sakara, who revoked the boat’s certificate.

Khek Sakara hopes that stern handling of such cases will show the international community that Cambodia is committed to running a legitimate registry. Sinking ships just bring bad press, he said.

“It’s bad advertising for the country,” he said.

(Additional reporting by Phann Ana)




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