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Why so many shipowners find Panama's flag convenient
August 6, 2014 6:43 AM   Subscribe

"Panama, a small nation of just three million, has the largest shipping fleet in the world, greater than those of the US and China combined. Aliyya Swaby investigates how this tiny Central American country came to rule the waves."
posted by travelwithcats (23 comments total) 7 users marked this as a favorite

 
Such a surprise that it wasn't about wanting greater safety for the crews and ships.
posted by lesbiassparrow at 7:00 AM on August 6 [6 favorites]


Two years ago, Mr Fruto investigated the death of a woman sailor, 22, on her first voyage.

"Woman sailor" seems a rather odd way to put this, no?
posted by Chrysostom at 7:33 AM on August 6


This used to be Liberia about thirty years ago. Before that, I think most US companies actually had US flags. Despite having foreign flags, US shippers at that time still relied heavily on US crews through the M.E.B.A. and other US maritime unions. I don't think that's true any more.
posted by me & my monkey at 7:35 AM on August 6


Sailorina?
posted by notsnot at 7:37 AM on August 6 [2 favorites]


Most merchant ships flying Panama's flag belong to foreign owners wishing to avoid the stricter marine regulations imposed by their own countries.

Oh, Capitalism, you scamp!
posted by GenjiandProust at 7:39 AM on August 6 [6 favorites]


Perhaps it's to the benefit of the shipping company to support the canal a little bit? And at the same time minimize tax and other regulations? Perhaps it makes significant FIDUCIARY sense?
posted by sammyo at 7:39 AM on August 6


The book 90 Percent of Everything explores the shipping industry, the way that parts of it look more like organized crime than business (i mean - assuming there's an ordinary distinction), and how flags of convenience/open registries facilitate that.
posted by entropone at 7:42 AM on August 6 [5 favorites]


The users already pay fees for the use of the canal.
posted by Monday, stony Monday at 7:43 AM on August 6


Perhaps it makes significant FIDUCIARY sense?

So does tax sheltering, ownership obfuscation, cutting corners on safety, crew indentured servitude, avoiding regulations which pay for otherwise unaccountable externalities...
posted by notsnot at 7:50 AM on August 6 [3 favorites]


Greed upon the Oceans.
Here is the wiki page listing Flags of Conveniance.
Panama collects tolls from all passing ships.
Here is a little blog about it.
In 2012 the Canal made $1 billion in profit.
posted by adamvasco at 8:06 AM on August 6 [1 favorite]


Sailrix.
posted by steganographia at 8:34 AM on August 6 [1 favorite]


Honestly, I'd have no problem with this so long as whatever applicable law required the executives and board members of the shipping companies to live, say, 80% of the year in the country their ships are flagged in.

In a similar vein, the same should apply to companies incorporated in Delaware. And credit card companies "headquartered" in South Dakota.
posted by Thorzdad at 8:49 AM on August 6 [2 favorites]


Bolivia, a landlocked nation, has 4 foreign owned ships from Syria, and 1 from the UK. That seems normal.
posted by Stonestock Relentless at 8:51 AM on August 6


For Americans, using the US registry is like hiring legal domestic help: it's only really worthwhile if you're trying to get a government job.
posted by ckape at 8:51 AM on August 6


Well, that, and the Jones Act.
posted by Stonestock Relentless at 8:56 AM on August 6


Fiduciary does not mean or even imply what's going on here.
posted by JPD at 9:51 AM on August 6


Any time our navy assists or rescues a ship that's using a flag of convenience, either they or the registering nation should be charged the full price of the assistance offered. We could make a mutual assistance pact with countries with actual working navies and functioning maritime regulations, so their ships wouldn't be charged.
posted by Mitrovarr at 11:16 AM on August 6


Sailorina?

Sailor also works.
posted by ActingTheGoat at 12:29 PM on August 6


Sailrix?
posted by Hatashran at 5:19 PM on August 6


They should do it like Pennsylvania does for out of state CDL registrations. Maine ( could be different now.) has the lowest fees in the East coast, but PA says, you can register your trucks there, but you have to register just as many in PA. Companies save money, and PA and ME both get revenue.
posted by 922257033c4a0f3cecdbd819a46d626999d1af4a at 6:51 PM on August 6


I was gonna say sailatrix, but mostly just because it sounds nice.
posted by emptythought at 5:41 PM on August 7


Mitrovarr: "Any time our navy assists or rescues a ship that's using a flag of convenience, either they or the registering nation should be charged the full price of the assistance offered."

A common debate in search and rescue is whether to charge users because it tends to discourage people from calling for service until they _really_ need it at which point the rescue is longer, more expensive and more dangerous.
posted by Mitheral at 6:01 PM on August 7


Bolivia still has a navy, though.
posted by Monday, stony Monday at 9:08 AM on August 11


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