Defying convention - Establishing international uniformity

THE 1999 International Convention on the Arrest of Ships is a legal instrument establishing international uniformity for the arrest of ships. But, as it still awaits ratification from the requisite ten countries, just how realistic is its ultimate universal implementation?

Despite the best efforts of the 1999 convention, and of its 1952 predecessor, there remain significant differences between arrest procedures in jurisdictions around the world. This was the main theme behind the Obtaining Security for Shipping conference, held in London on December 7-8, 2000.

Chaired by Bob Deering, partner at Ince & Co, the two-day event organised by Lloyd’s List Events had a truly international feel, with legal representatives from around the world, including Spain, Russia, South Africa, China and the USA.

One country that would particularly benefit from signing up to the 1999 version of the arrest conversion is Russia. Although Russia ratified the 1952 convention in January 1999, and incorporated it into its Merchant Shipping Code the following May, its arrest procedures remain vague and fraught with difficulties. Olga Baglay, lawyer at Watson, Farley & Williams in Russia, told delegates, “You can’t arrest a vessel quickly in Russia. It normally takes a minimum of one week.”

The problem seems to lie with the courts. “Some courts in Russia have no experience in dealing with maritime claims and will try anything to reject a claim rather than deal with it,” said Baglay. There is in fact no arrest procedure in Russia, and no clear provisions regarding paperwork. And a lot of time is lost along the way getting relevant documents translated. St Petersburg is the most difficult jurisdiction, closely followed by Novorossiysk on the Black Sea, where success depends on you knowing the judges and the judges knowing you. Vladivostock, however, appears to be moving towards the principles of the convention, which should make life easier in the future. But Baglay was quick to warn delegates that, in some ports, the law is so vague - and changes so rapidly - that foreign law firms will get little local support when seeking to arrest ships. “Our hearts go out to you Olga,” said Deering.

South Africa is at the opposite end of the spectrum. It is often described as an owner’s nightmare because of the ease with which arrests can be made. “South Africa has made a great name for itself in arresting ships,” said Michael Pampallis, partner at Pampallis Marine and Commercial Law. “Unusual, effective, cheap and quick, with excellent legal services - a good jurisdiction to litigate.”

Spain is another jurisdiction which offers favourable arrest procedures. Ignacio de Ros, a Barcelona-based maritime advocate, gave a colourful, and even musical, presentation on the arrest procedure in Spain. With more than 74,000 vessels passing through the Gibraltar Strait each year, it is hardly surprising that ship arrest has become big business in Spain. “It is easier to arrest a vessel than a car,” said de Ros. It is also cheap. “The only costs of a ship arrest are the lawyer and the procurator’s fee. We have no court costs. The vessel is under the surveillance of the civil guard, and therefore free of costs,” added de Ros, who was however quick to add that obtaining security in Spain requires one other vital ingredient - athleticism. The paper chase involved around the relevant courts can be a lengthy and tiring process - a motorbike wouldn’t go amiss, according to de Ros.

De Ros closed his presentation by floating the concept of virtual arbitration, using the internet to link parties with an arbitrator electronically. “This will be cheaper, and hopefully something that will come about in our lifetime,” he said.

Others speakers included Jonathan Lux, partner at Ince & Co. “Nothing concentrates the mind of shipowners and their P&I clubs quite like an arrest. Arrests can be time-consuming and expensive. They are always inconvenient,” said Lux. “Unfortunately, although the 1999 convention appears to represent a number of sensible clarifications and extensions of the 1952 convention, it has to be said that there has not been any great move towards ratification.”

The fact is that, with only six countries signed up to the 1999 convention to date, international uniformity in ship arrest remains a dream rather than a reality.