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MMLA President at UNCITRAL Working Group VI first meeting held in New York on the International Recognition of Judicial Sales

May 31, 2019 Leave a Comment

Between the 13^th and 17^th of May 2019, President of the MMLA, Dr Ann Fenech was at the first meeting of UNCITRAL Working Group VI which has been tasked with considering the draft convention presented by CMI on the International Recognition of Judicial Sale of Ships.

Dr. Fenech participated in this meeting at UNCITRAL in her capacity of Vice President of CMI and as CMI co-ordinator for the project at UNICTRAL.

This was the first meeting of the Working Group VI attended by States members of UNICTRAL during which Dr. Beata Czerwenka was appointed Chairman of Working Group VI.

During this first meeting lasting an entire week, the Swiss Delegate Prof. Alex von Zeigler, a member of the Executive Council of CMI, presented the project since it was on the proposal of Switzerland last July 2018 that the 51 Assembly of UNICTRAL accepted to take on this work as part of its programme.

As CMI co-ordinator for the project Dr. Fenech was tasked with giving a preliminary explanation of each proposed article to the convention. There was agreement on the usefulness of the CMI draft to be used as the basis for any future work. The entire week was taken up with the explanations and answering of questions raised by all the delegations present. It was concluded at this first meeting that the UNCITRAL secretariat will now work on another draft taking into account the various ideas expressed and that the next draft will be the subject matter of the next Working Group VI meeting in Vienna in November of this year.

Dr Ann Fenech elected CMI Vice President

December 5, 2018 2 Comments

The Malta Maritime Law Association is delighted to announce that Dr Ann Fenech, President of the Malta Maritime Law Association and Managing Partner of Fenech & Fenech Advocates was last Friday (9 November 2018) elected Vice President of the Comité Maritime International (CMI) by the General Assembly of the CMI at the IMO in London.

The CMI is an international body established in Antwerp in 1891 with the aim of unifying International Maritime Law. It has been responsible of drafting some of the most important international maritime conventions including the Arrest Conventions of 1952 and 1999, the Collision Regulations and the Salvage Convention.

Dr Fenech was suggested for nomination for this position by Ireland and Sweden. She was voted in by the members of CMI who are the national maritime law associations of 51 different countries. She is the first Maltese to be elected to the position of Vice President within the CMI.

The CMI is currently working on a number of important projects including Automation and the International Recognition of Judicial Sales. Dr Fenech was heavily involved in recent efforts in persuading UNCITRAL (the United Nations Committee on International Trade Law) to accept the proposal of the Government of Switzerland to commence work on an International Convention on the International Recognition of Judicial Sales. UNICITRAL has in fact added this project to its working agenda.

Dr Fenech’s election as Vice President of the CMI is considered as a very valuable addition to the profile of Maritime Malta world wide. It will mean that Maritime Malta will also be represented at the highest levels of international maritime law. Ann Fenech has been practicing maritime law exclusively since 1986.

Lost mortgage instruments

November 8, 2018 Leave a Comment

The registration of a mortgage over a Malta-flagged vessel in favour of an individual, corporate lender or security trustee (the mortgagee) requires the filing of a statutory mortgage instrument (the deed) at the Maltese Ship Registry. Once the mortgage has been registered and the time and date of registration has been recorded in the vessel’s register and annotated on the deed, the registered deed is released in its original form to the mortgagee and certified true copies thereof are released to the registered shipowner (the mortgagor).

Maltese law also permits the transfer or assignment of registered mortgages pursuant to Sections 44 and 44A of the Merchant Shipping Act (Cap 234 of the Laws of Malta), which require the completion of an instrument of transfer or assignment. Once the same has been filed with the Registry of Ships, the mortgage may be transferred in favour of a new mortgagee.

Once the underlying obligation has been extinguished, the mortgage securing such obligation must also be discharged. The discharge of the security will require the filing of the original deed with the Ship Registry and a duly completed instrument of transfer or assignment. Thereafter, following the mortgagee’s instructions, the mortgage will be discharged with the time and date of discharge being recorded in the vessel’s register and on the deed.

However, what happens if the original mortgage instrument is misplaced?

Maltese law affords two remedies in instances where the original deed has been lost. The chosen remedy will depend on the remaining duration of the registered security.

Available remedies for lost deeds

Reconstitution of lost mortgage instrument
Section 48 of the Merchant Shipping Act provides that a lost mortgage instrument can be reconstituted on the mortgagee’s request alone or together with the mortgagor.

A sworn declaration (affidavit) referencing the loss of the original deed, together with a copy of the lost deed, must be filed at the Ship Registry.

The registrar will then make a note in the vessel’s register that a reconstituted mortgage instrument has been issued and annotate the copy of the lost deed.

The annotated copy of the lost deed will be deemed to be the reconstituted mortgage instrument and, should the security registered over the vessel eventually be transferred or discharged, the reconstituted mortgage instrument must be completed overleaf and filed at the Ship Registry. The transfer or discharge will be registered pursuant to the reconstituted mortgage deed.

Sworn declaration
If a deed is lost shortly before the security is scheduled to be transferred or discharged, the mortgagee may issue a sworn declaration (affidavit) indicating that it is the holder of the mortgage and that the original instrument has been lost.

On filing the sworn declaration, the registrar will treat such sworn declaration as the mortgage instrument.

Any mortgage transfers or discharges will be registered by virtue of the sworn declaration; a note to that effect will be entered in the vessel’s register and the sworn declaration will be annotated accordingly.

Comment

The above mechanisms afford mortgagees added protection should their original deed be lost. They not only confirm the continued validity of the mortgage despite the loss of the original deed, but also provide mortgagees with peace of mind and remedies should their mortgage need to be transferred or discharged.

by Lara Saguna Axiaq and Charlotte Spiteri, members of the MMLA and maritime lawyers within the Ship Registration & Finance Department of Fenech & Fenech Advocates

Source: ILO

MMLA President Ann Fenech appointed Honorary Member of the Croatian Maritime Law Association

November 2, 2018 Leave a Comment

Dr. Ann Fenech, President of our association was appointed Honorary Member of the Croatian Maritime Law Association, during the 2^nd International Scientific Conference on Maritime Law held in Split on the 28^th of September.

Dr. Fenech had been invited to the Conference to deliver a Key Note address on “The International Recognition of Judicial Sales – the way forward.”

She was awarded the Honorary Membership by the President of the Croatian Maritime Law Association, Gordon Stankovic who stated that this honour was being conferred on Dr. Fenech for the work that she has embarked on over the past few years as an Executive Council Member of the CMI. Other recipients of this award include Giorgio Berlingieri, Patrick Griggs and Prof. Rhidian Thomas.

Regulating autonomous ships

September 19, 2018 Leave a Comment

What are the challenges of autonomous navigation on board masterless vessels?

Challenges, whether legislative, sociological or technological, form part of our daily work routine. Contrary to previous decades, innovative models do not require years or even months to cross an ocean. Evolution tends to spread very fast, more so nowadays when millennials are rapidly engaging themselves in managerial roles largely concerned with quick and effective product placement.

The recent emergence of blockchain technologies, the steady infiltration of cryptocurrencies in our lives and the recently introduced GDPR rules have proved that shipping, like any other sector involved in the carriage of persons and goods, is also not immune to such novelties.

Unmanned technology is also gaining particular momentum within the shipping industry. The aim of such technology is clearly that of supporting the ship operator, cargo owner and ultimate consumer by reducing human-derived risks and operational costs connected with the carriage of goods by sea. However, when it comes to ships and navigation one must keep in mind that the lawmaker often ranks the protection of seafarers and of the sea environment at the top of its priorities, ahead of such strictly navigational or commercial aspects which also arise from the use of autonomous ships. It will be interesting to see how these two differing interests can and should coexist next to each other.

Use of driverless means of transport has become common across various sectors of public transportation. Many capital cities have adopted driverless metro systems for years now. The same is happening with respect to the private transportation by car, although the latter is still going through (an advanced) testing phase.

The difference between such means of transport lies mainly on the number of variables that these come across throughout their operation. As metros operate on a one-direction line, collisions can be easily reduced through a number of mechanical and electronic precautions. On the other hand, during their journey, cars come across other cars, buses, trucks, pedestrians, animals and different meteorological events, and so cannot make a linear journey.

What does autonomy mean with particular reference to ships? The International Maritime Organisation has identified four different types of vessel autonomy.

The first are ships with automated processes and decision support where seafarers operate and control systems and functions directly from the vessel and only some operations may be automated. The second are remotely controlled ships where seafarers are on board the vessel although the ship is controlled and operated from another location. The third are remotely controlled ships without seafarers on board where the vessel is controlled and operated from another location with no seafarers on board. Finally, the fourth are fully autonomous ships where the operation is performed automatically by the vessel’s operating system.

Trials on autonomous ships have already commenced in Norway and Finland. Denmark has also taken steps to regulate this particular aspect of navigation; with the first autonomous ship to be used for subsea positioning, surveying and environmental monitoring currently registered under the British flag. The European Union has also invested in research projects such as the EU’s FP7 project (Maritime Unmanned Navigation through Intelligence in Networks).

The introduction of automation, as happened in other industries, would produce an immediate and tangible effect on the workforce on board ships and port operators engaged in the loading and offloading of cargo. On the other hand this would be beneficial for IT developers involved in the creation of software meant to govern navigation and protecting same from the risk of cyber-attacks. Automation might be welcomed by insurers, and a bit less by ship litigators, since with respect to the cargo loading and unloading procedures it will reduce the amount of mistakes deriving from human error.

However, one of the main obstacles faced by autonomous ships lies in the current legal framework within which their manned counterparts operate. In fact most – if not all – maritime conventions (and charter parties) assume that vessels operate with crew on board – this is the case, for example, of the Maritime Labour Convention or the International Convention on Standards of Training, Certification and Watch keeping for Seafarers – a requirement an autonomous ship would unlikely be able to satisfy.

Another challenging aspect concerning autonomous ships revolves around the implementation of the International Regulations for Preventing Collisions at Sea (COLREGS) in particular when these will be navigating alongside manned ships. The COLREGS often contain provisions referring to the human element; referring for example to “the ordinary practice of seamen” test, that is, what a reasonably competent mariner should do in a given situation (similarly to the bonus paterfamilias test used in civil law).

Automation would require practitioners to start considering accidents which might arise, for example, when an operator makes a poor decision in reliance on wrong information provided by the vessels’ sensors due to a technical failure. Such instances are bound to raise further questions on the apportionment of liability between the operator, manufacturer or software developer and ship-owner.

Moreover, within a shipping ambit different types and degrees of liability already coexist next to each other: that of the ship-owner (or the bareboat charterer) for crew’s actions (i.e. COLREGS); or that of the registered owner (i.e. pollution at sea conventions) while other forms of liability make the ship liable in its own right (e.g. maritime liens).

Apportionment of liability between the ship-owner, software developer and manufacturer is an aspect not to be underestimated even in such a context. How would an autonomous ship be expected to intervene in case should it encounter, throughout her route, another ship in distress? Also, where would responsibility lie in the case of environmental damage? Will the ship-owner be held accountable or will responsibility for the ensuing damage lie on the software provider, for example, for not having developed a sound algorithm or on the vessel’s sensors’ manufacturer for their technical failure?

Legal clarity around cyber liability and collision regulations is fundamental if autonomous ships want to sail free on our seas and oceans, especially before the maritime industry starts investing in infrastructure and skills needed to for unmanned ships to reach a commercial level.

The answers to these questions are far from clear, and much work needs to be done before international solutions are in place. The Comité Maritime International (CMI), of which the Malta Maritime Association is a proud and active member, has recently established a working group on maritime law for unmanned craft, aimed at analysing how international conventions and regulations can adapt themselves to autonomous ships.

Many in the industry, in view of a lack of clear regulations in this respect, have welcomed this news in a conservative manner. Truth is that you cannot stop innovation from happening. Not, at least, in today’s world where ideas travel at the speed of sound from one corner of the world to another and with such a multitude of players wishing to gain new shares in an often saturated market. The interests in such area are many, from that of ship builders wishing to consolidate or grow their market share, to that of the ship owner wishing to cut costs or that of IT developers wishing to expand their reach in this industry, to that of crew members wishing to safeguard their jobs.

The importance of such a new means of navigation, although still far from becoming an everyday reality, has generated such an interest that even the IMO’s Maritime Safety Committee kicked off the procedure leading to the regulation of Maritime Autonomous Surface Ships (MASS). This exercise aims at regulating aspects concerning safety, security and environment. IMO’s focus is international trade facilitation, analysis of potential costs of the industry and the impact on individuals operating both off and onshore. The IMO will first look into the application of current legislation onto MASS and ascertain whether each specific provision can be applied to it and the regulations that need to be amended or introduced.

A possible key to facilitating navigation of autonomous ships on our seas and oceans could lie in the adoption of a uniform and linear set of rules modelled on the current IMO framework. It is submitted that a mere temporary or piecemeal update of regulation is not sufficient. Rules should, as much as possible, contain self-updating provisions able to cater for current as well as future technological advances. Shipping, more than any other sector in view of its global breadth, requires common and uniform standards and this can clearly only be achieved through the intervention of the International Maritime Organisation.

by Stephan Piazza, member of the MMLA Executive Committee and Manager Transport & Leisure – Shipping, Aviation & Infrastructure at KPMG in Malta

Source: Times of Malta, Maritime & Logistics Supplement

Picture: new atlas, Rolls-Royce

Member of the Comité Maritime International

MMLA President at UNCITRAL Working Group VI first meeting held in New York on the International Recognition of Judicial Sales

Dr Ann Fenech elected CMI Vice President

Lost mortgage instruments

MMLA President Ann Fenech appointed Honorary Member of the Croatian Maritime Law Association

Regulating autonomous ships

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