GOVERNMENTS ASK OECD TO PROBE DISCLOSURE OF VESSEL OWNERS

GOVERNMENTS ASK OECD TO PROBE DISCLOSURE OF VESSEL OWNERS    Member governments of the Organization for Economic Cooperation and Development have asked the Paris-based organization to study how shipowners can hide their ownership of vessels, and consider ways to ensure transparency.
   At a meeting of the OECD Maritime Transport Committee on July 16-17, member governments discussed the question of the current opacity of ownership of vessels, which is seen as a potential obstacle to increasing maritime security.
   “Creating transparency in the ownership and ultimate control of ships (not day to day or operational control, which is being investigated by the International Maritime Organization) is considered to be of positive assistance to security forces, by assisting the recognition and identification of vessels that might pose security risks,” the OECD secretariat said.
   The OECD believes that ships may be used as weapons, to carry weapons or terrorists or support terrorist activities through the revenue they generate or any other illicit purposes.
   “While the overall    number of ships posing such risk is relatively small, the potential threat to society of such vessels is enormous, and this warrants detailed investigation of how transparency could be achieved,” the Paris-based organization said.
   In its recent work on maritime security, the International Maritime Organization has decided not to open the question of ownership of vessels, saying that identifying the operators of the ships was the priority.
   Under the proposed study, the OECD Maritime Transport Committee wants to first understand how owners can create “a cloak of secrecy around their ownership of specific vessels,” and then, if this analysis warrants further action, to investigate how such practices could be addressed and to produce some “best practices.” These potential best practices would be adopted by registers to enhance transparency, while still enabling confidentiality for commercially sensitive details that are not related to security.
   The OECD said that, theoretically, ship registers should provide information on ownership, and through this, who holds ultimate control of that vessel. “However, some flags either overtly or covertly allow those ownership details to be opaque to the point of impenetrability,” it said.
   Wolfgang Hubner, head of the maritime transport division of the OECD, said that his organization will start work on the vessel ownership study soon. The study forms part of the 2003 work program of the OECD Maritime Transport Committee, he said.
   The vessel ownership analysis is expected to attract wide interest among the shipping industry.
   The OECD mandate to probe vessel ownership follows strong concerns aired at a June U.S. House Armed Services Committee hearing that certain ship registries, or so-called “flags of convenience,” serve as easy conduits for terrorist activities, and that vessel owners are not always known.