Russian flag for Russian vessels
By 2009, Russian International Register of Vessels is to accept the ships of Sovcomflot, Russia’s largest shipping company. It is to become a significant step towards the Register’s development in terms of both tonnage and quality of vessels. In general, the Register’s development is not very active today as its operating principles have not been worked out yet. Last year, only 2 of 16 newly built transport vessels were registered under Russian flag, while the rest ships were registered under ‘convenient’ flags. However, the Ministry of Transport of the Russian Federation hopes to attract more vessels in future in order to improve the competitiveness of the Russian fleet at the world market.
At the meeting between Valentina Matvienko, the Governor of St.Petersburg, and Sergey Frank, Director General of Sovcomflot OJSC, the head of the shipping company said that by 2009, Sovcomflot plans to register five vessels with the Russian International Register of Vessels. . As Valentina Matvienko noted, these vessels, which are to be deployed for operation at the shelf of the Far North, are to become the first vessels registered under Russian flag in St. Petersburg. The city government is interested in making its best to implement the project. under Russian flag in St. Petersburg. In December 2007, S. Korea’s Samsung Heavy Industries Co., Ltd completed the construction of the first vessel, the Vasily Dinkov tanker. The other vessels are to be built both abroad and at the Admiraty Shipyards in St. Petersburg. They are to be registered with the Russian International Register of Vessels, which provides certain privileges for ship owners unlike the State Shipping Register. When establishing the Russian International Register of Vessels there was a particular purpose to attract foreign vessels the operation of which, in Arctic for example, requires Russian flag.
As PortNews IAA learnt from Aleksei Klyavin, Director of State Policy for Maritime and River Transport, the transfer of Sovcomflot vessels to the Russian flag is to mark the new stage in the development of the Russian International Register of Vessels as large-capacity vessels of the latest generation will operate under the flag of Russia. When Sovcomflot registers its five tankers, total deadweight of vessels registered with the Russian International Register of Vessels will exceed 1 million tonnes. According to Aleksei Klyavin, it is to raise the prestige of the Russian shipping companies at the international market and to improve their competitiveness.
As of today, some 200 vessels with total deadweight of some 800,000 tonnes are registered with the Russian International Register of Vessels. According to the RF Ministry of Transport the fleet controlled by Russia comprises the fleet of maritime shipping companies numbering 153 vessels with total deadweight of 1.9 million tonnes, the fleet of other shipping companies including those operating sea-and-river going vessels numbering 1,154 vessels with total deadweight of 3.9 million tonnes and the fleet of Russian shipping companies operating the vessels registered under foreign flags numbering 164 vessels with total deadweight of 10.4 million tonnes including the fleet of Sovcomflot numbering 58 vessels with total deadweight of 4.5 million tonnes.
As of the beginning of 2008, Russia controlled 1,471 vessels with total deadweight of 16.2 million tonnes with 63.9% of the tonnage falling on those under foreign flags. In 1992 it was equal to only 18.4%. Thus, considering formal registration of vessels under national flag in 2007 Russia was the 30th as regards the fleet tonnage. However, taking into account those Russian vessels, which are registered under ‘convenient’ flags Russia holds the 13th place after Great Britain and Denmark being ahead of Italy and Turkey, foreign experts say.
Meanwhile, ship owners do not seek registration of their vessels under Russia flag regardless the introduction of the second register. Of 16 transport vessels built in 2007, only 2 vessels were registered under national flag. The delivery of 27 transport vessels with total deadweight of 1.6 million tonnes is planned for 2008. According to the Ministry of Transport 7 of them are to be registered under Russian flag.
However, attraction of ship owners to the Russian register is based on expansion of the range of services. In December 2007, the Ministry of Transport authorized classification society Germanischer Lloyd (GL) to perform statutory duties on ships with Russian flag. Germanischer Lloyd is the very first foreign society to be granted this right. The authorization includes surveys, plan approval and issuance of certificates for international conventions. Parallel to the authorization of Germanischer Lloyd for the Russian flag, the German flag administration Seeberufsgenossenschaft (See-BG) has approved the Russian Maritime Register. The Russian society is now authorized to carry out surveys on German-flagged ships. GL notes the decision of the Ministry of Transport provides Russian ship owners with the right to choose a classification society. Besides, many of Russian shipping companies operate at the European market today and German society could be a reasonable choice to improve the partner’s confidence.
Adoption of the Federal Law No 168-FZ and establishment of the Russian International Register of Vessels should equal tax and organizational conditions for Russian ship owners and their foreign colleagues. Besides, it is to support competitiveness without the change of flag and registration of vessels.
The problems with transfer of Russian companies to the national flag are not solved with the establishment of the second register in Russia. The majority of experts and ship owners think that the law implementation needs adoption of many bylaws to set up a precise procedure for cooperation with customs, tax and other regulatory authorities. For example, the issue of import customs duty, which was to be cancelled according to the Russian Register Law, was solved only in summer 2007, by the decree of the Russian Federation. According to the decree, the vessels registered with the Russian International Register of Vessels are to be exempt from import customs duty upon provided that the customs authorities are provided with the corresponding certificate of registration and a duplicate document certifying payment of the state duty for registration. If the vessel is excluded from the register the customs duty is to be paid by the owner on the day following the day of exclusion.
Experts say the income from the fleet registration may total $2 million per year. Besides, income tax to be paid by the vessels’ crews is to make millions of dollars. However, to make the register’s activity economically efficient it is important to solve a number of issues related to practical enforcement of the legislation.
Functioning of the Russian International Register of Vessels, problems and perspectives of the revival of Russian commercial fleet, aspects of construction, classification, tax and customs clearance of vessels registered with the Russian International Register of Vessels will be discussed a the conference “Russian International Register of Vessels: practice, problems and perspectives”, to be held on April 16 in St. Petersburg by PortNews LLC under support of the RF Ministry of Transport.
Mariya Mokeicheva
At the meeting between Valentina Matvienko, the Governor of St.Petersburg, and Sergey Frank, Director General of Sovcomflot OJSC, the head of the shipping company said that by 2009, Sovcomflot plans to register five vessels with the Russian International Register of Vessels. . As Valentina Matvienko noted, these vessels, which are to be deployed for operation at the shelf of the Far North, are to become the first vessels registered under Russian flag in St. Petersburg. The city government is interested in making its best to implement the project. under Russian flag in St. Petersburg. In December 2007, S. Korea’s Samsung Heavy Industries Co., Ltd completed the construction of the first vessel, the Vasily Dinkov tanker. The other vessels are to be built both abroad and at the Admiraty Shipyards in St. Petersburg. They are to be registered with the Russian International Register of Vessels, which provides certain privileges for ship owners unlike the State Shipping Register. When establishing the Russian International Register of Vessels there was a particular purpose to attract foreign vessels the operation of which, in Arctic for example, requires Russian flag.
As PortNews IAA learnt from Aleksei Klyavin, Director of State Policy for Maritime and River Transport, the transfer of Sovcomflot vessels to the Russian flag is to mark the new stage in the development of the Russian International Register of Vessels as large-capacity vessels of the latest generation will operate under the flag of Russia. When Sovcomflot registers its five tankers, total deadweight of vessels registered with the Russian International Register of Vessels will exceed 1 million tonnes. According to Aleksei Klyavin, it is to raise the prestige of the Russian shipping companies at the international market and to improve their competitiveness.
As of today, some 200 vessels with total deadweight of some 800,000 tonnes are registered with the Russian International Register of Vessels. According to the RF Ministry of Transport the fleet controlled by Russia comprises the fleet of maritime shipping companies numbering 153 vessels with total deadweight of 1.9 million tonnes, the fleet of other shipping companies including those operating sea-and-river going vessels numbering 1,154 vessels with total deadweight of 3.9 million tonnes and the fleet of Russian shipping companies operating the vessels registered under foreign flags numbering 164 vessels with total deadweight of 10.4 million tonnes including the fleet of Sovcomflot numbering 58 vessels with total deadweight of 4.5 million tonnes.
As of the beginning of 2008, Russia controlled 1,471 vessels with total deadweight of 16.2 million tonnes with 63.9% of the tonnage falling on those under foreign flags. In 1992 it was equal to only 18.4%. Thus, considering formal registration of vessels under national flag in 2007 Russia was the 30th as regards the fleet tonnage. However, taking into account those Russian vessels, which are registered under ‘convenient’ flags Russia holds the 13th place after Great Britain and Denmark being ahead of Italy and Turkey, foreign experts say.
Meanwhile, ship owners do not seek registration of their vessels under Russia flag regardless the introduction of the second register. Of 16 transport vessels built in 2007, only 2 vessels were registered under national flag. The delivery of 27 transport vessels with total deadweight of 1.6 million tonnes is planned for 2008. According to the Ministry of Transport 7 of them are to be registered under Russian flag.
However, attraction of ship owners to the Russian register is based on expansion of the range of services. In December 2007, the Ministry of Transport authorized classification society Germanischer Lloyd (GL) to perform statutory duties on ships with Russian flag. Germanischer Lloyd is the very first foreign society to be granted this right. The authorization includes surveys, plan approval and issuance of certificates for international conventions. Parallel to the authorization of Germanischer Lloyd for the Russian flag, the German flag administration Seeberufsgenossenschaft (See-BG) has approved the Russian Maritime Register. The Russian society is now authorized to carry out surveys on German-flagged ships. GL notes the decision of the Ministry of Transport provides Russian ship owners with the right to choose a classification society. Besides, many of Russian shipping companies operate at the European market today and German society could be a reasonable choice to improve the partner’s confidence.
Adoption of the Federal Law No 168-FZ and establishment of the Russian International Register of Vessels should equal tax and organizational conditions for Russian ship owners and their foreign colleagues. Besides, it is to support competitiveness without the change of flag and registration of vessels.
The problems with transfer of Russian companies to the national flag are not solved with the establishment of the second register in Russia. The majority of experts and ship owners think that the law implementation needs adoption of many bylaws to set up a precise procedure for cooperation with customs, tax and other regulatory authorities. For example, the issue of import customs duty, which was to be cancelled according to the Russian Register Law, was solved only in summer 2007, by the decree of the Russian Federation. According to the decree, the vessels registered with the Russian International Register of Vessels are to be exempt from import customs duty upon provided that the customs authorities are provided with the corresponding certificate of registration and a duplicate document certifying payment of the state duty for registration. If the vessel is excluded from the register the customs duty is to be paid by the owner on the day following the day of exclusion.
Experts say the income from the fleet registration may total $2 million per year. Besides, income tax to be paid by the vessels’ crews is to make millions of dollars. However, to make the register’s activity economically efficient it is important to solve a number of issues related to practical enforcement of the legislation.
Functioning of the Russian International Register of Vessels, problems and perspectives of the revival of Russian commercial fleet, aspects of construction, classification, tax and customs clearance of vessels registered with the Russian International Register of Vessels will be discussed a the conference “Russian International Register of Vessels: practice, problems and perspectives”, to be held on April 16 in St. Petersburg by PortNews LLC under support of the RF Ministry of Transport.
Mariya Mokeicheva