How shipping's flags of convenience endanger seafarers

A loophole in global maritime law enables shipowners to sidestep labor protections and safety rules by registering their vessels under flags of convenience, a practice linked with abuse of crews, according to watchdogs.

Every merchant ship must register under a flag state, subjecting it to that country's laws and determining which nation is responsible for enforcing safety, labour and environmental standards on the ship, no matter where it sails.

Some owners register their ship in a country different than their own, including those deemed to offer flags of convenience, or FOC, by organisations like the International Transport Workers' Federation (ITF) due to their lax oversight of regulations and safety.

The ITF, which represents the rights of transport workers, has found that FOC vessels are responsible for the majority of reported cases of crew abandonment, wage theft and poor working conditions.

Here is what you need to know.

Why do shipowners register vessels in different countries?

Shipowners may opt for a flag of convenience to reduce costs and sidestep regulations that are stricter in their own countries. Open registries, which do not have residency or nationality requirements, offer lower fees, minimal or no taxes and lenient enforcement of rules.

By registering abroad, often online, owners gain flexibility, including the ability to hire low wage crews from developing countries.

They may also remain anonymous through shell companies, and concealing the owner weakens accountability and bolsters liability protection and privacy.

How does a flag of convenience affect the legal responsibilities and oversight of a ship?

A ship's flag state formally assumes jurisdiction, issues certifications and oversees compliance under the United Nations Convention on the Law of the Sea (UNCLOS), a legal framework for global maritime activities.

However, many FOC countries have weak enforcement capacity because registries may be managed abroad, monitoring is minimal and inspections are rare. Ownership anonymity further complicates oversight.

This all conspires to fragment responsibility.   

How do flags of convenience impact seafarers' rights and working conditions?

Flags of convenience often correlate with poor conditions for crew.

The ITF warns that these ships typically pay very low wages, overwork seafarers, provide inadequate food, water, rest and sanitary facilities and frequently abandon crews without pay.

Such cases of ship abandonment reached a record last year.

Palau President Surangel Whipps, whose country operates an open registry, told Context he was unaware that dozens of ships flying his country's flag had abandoned crews but pledged to "clean up" the system.

"It's a damning indictment of the entire flag of convenience system when a country's president ... doesn't even know that his flag is involved in serial abuses of seafarers' human rights - which are recorded and made publicly accessible via U.N. agencies," Steve Trowsdale, the ITF's inspectorate coordinator, said in a statement to Context.

What are some other countries that offer flags of convenience?

The ITF identifies 45 states that operate flags of convenience, including Tanzania, the Bahamas, Malta and Comoros.

They offer online registries, attract foreign-owned ships and have no nationality or crew composition restrictions.

Panama draws interest with low fees and fast registration. Liberia and the Marshall Islands similarly offer low cost services.

Newer registries in Guinea Bissau and Mongolia have joined the FOC trend, gaining revenue while offering little oversight.   

What challenges do port states or international regulators face in enforcing rules on FOC ships?

Port states rely on Port State Control regimes, such as the Paris Memorandum of Understanding, to inspect and detain unsafe vessels.

The Paris MoU, an international agreement on port inspections, also grades the riskiness of each flag state, placing them on "white," "grey" or "black" lists.

Yet FOC ships can change names or "flag hop," in which they change flags repeatedly to avoid detection for their violations.

Shipping registries may be based abroad, diluting flag-state control. For instance, Liberia's flag registry is located in New York, and Gabon's is in the United Arab Emirates.

The International Maritime Organization and International Labour Organization, two U.N. bodies, are working to tighten standards, but flag state sovereignty under the UNCLOS limits their enforcement capacity.

This story was produced in partnership with the Pulitzer Center’s Ocean Reporting Network.

(Reporting by Katie McQue; Editing by Ayla Jean Yackley and Amruta Byatnal.)