Canals and courts

UNDOUBTEDLY the most important development in Panama last year, from a maritime standpoint, was the assumption by the government of Panama of full responsibility for the operation, maintenance and control of the Panama Canal. December 31, 1999, was the date provided for in the various treaties and understandings entered into between Panama and the United States for the complete reversion of the waterway to Panama from US control.

Both the constitutional provision adopted to guarantee the independent and apolitical operation of the canal and the organic law creating the Panama Canal Authority (PCA) as an agency and instrumentality of the Panamanian government, provide that agency with financial independence and a corporate structure. This is to enable the PCA to operate within certain prescribed business guidelines and to provide a guarantee to users of the canal that the new authority will function with the same stability and reliability which was observed for over 85 years by its predecessor, the now defunct US-run Panama Canal Commission.

The PCA recently completed its first anniversary as the sole operator of the Panama Canal. During the period just completed, canal customers and industry leaders have expressed their satisfaction that the canal has continued to operate efficiently and safely. The widening of the Gaillard Cut, which was initiated in 1992 and which will allow virtually unrestricted two-way transit of panamax vessels, continues on schedule. Arrangements for the purchase of new electric towing locomotives, upgraded machinery and equipment at the locks, as well as the purchase of new and updated tugs, launches and the installation of a new state-of-the-art vessel traffic management system, have all been implemented.

Panama continues to be the world’s leading open register in terms of numbers of vessels and tonnage. There are continued and constant attempts to comply with all international conventions and policies dealing with safety, pollution, contamination, crew safety and the like.

The Maritime Court of Panama, which was established in 1982, is vested with exclusive jurisdiction over all maritime cases filed in this jurisdiction. Additionally, as of 2000, this court also has jurisdiction over any litigation that might be brought against the Panama Canal Authority by a shipowner or its subrogees to recover damages to vessels or cargo and injuries to either crew or passengers by reason of a vessel’s presence in the Panama Canal or its adjacent waters.

Panama continues to be the world’s leading open register in terms of numbers of vessels and tonnage.

This court has been the forum invoked over the past few years to seek recovery of damages claimed to be due to Philippine crew members, on board vessels calling at the canal, for injuries allegedly suffered by them in the course of their employment. The Panama Supreme Court recently ruled in favour of one shipowner in such a dispute, recognising the validity of releases executed in the Philippines by the parents or widows of deceased crew members. The court held, on the basis of the testimony and proof presented by the shipowner and its underwriters, that the plaintiffs had failed to meet their burden of proof in support of their allegations that the releases had been obtained by fraud, lack of informed consent, lack of consideration and violation of public policy.