Today from Hiiraan Online:  _
Private maritime security licence rules are another notch for Malta

Thursday September 30, 2021

Piratical attacks on vessels are as old as the hills. Vessels traversing stretches of sea have, since time immemorial, been subjected to piratical attacks.

However, over the past few years, modern-day piracy has reared its ugly head in a big way.

With the collapse of stable governance off the east coast of Somalia, the world started to witness piratical attacks on merchant vessels and yachts travelling through the Gulf of Aden, the Horn of Africa and the East Coast of Somalia.

It is said that this all started “by accident”, when fishermen who lived in lawless Somalia started to notice fishing trawlers coming into their territory to fish illegally.

These fishermen therefore started to attack these trawlers. When and how these ordinary fishermen crossed the line to become highly organised pirates with extremely sophisticated equipment capable of identifying vessels, their flag, their ownership, their cargoes and crews is uncertain.

What we do know, however, is what we have today is a large-scale organised criminal industry the aim of which is to approach merchant vessels and yachts, board them, hijack the crew and vessel, and hold them to ransom.

Initially, there was much disagreement internationally on whether the vessels themselves should carry arms or indeed armed guards.

The International Maritime Organisation, with the support of the International Transport Federation, was initially totally against this because it felt that crew members were not ordinarily trained to carry weaponry and violence could escalate in the case of an attack, leading to further injury and deaths.

This was not the approach taken by the American lobby which, very early on, allowed crew members on board American-registered vessels to carry weapons.

Unfortunately, as time went by we saw more and more successful piratical attacks on vessels and crews, leading to the hijack of vessels with a number of vessels and their crew being kept in captivity for several months. The Orna was hijacked in December 2010 and released in October 2012, with some of the crew still kept by the pirates.

The effects of this scourge are immense, particularly the psychological trauma on the crew and on their families. Unfortunately not enough media coverage is given to this phenomenon.

Media coverage tends to be given to ‘unusual’ piracy cases such as the case of the Chalmers couple last year, who were released after their yacht was hijacked by pirates off the east coast of Somalia.

In terms of economic loss in 2011 alone, $635 million went into insurance cover, $486 million to $681 million went into rerouting costs, $2.7 billion lost in navigating at increased speed. $160 million went into ransom monies.

Unfortunately, notwithstanding numerous states dispatching their naval forces to the scene to patrol the area, the area in question now stretches from the east coast of Somalia to the west coast of India. It is simply far too large to patrol no matter the quantity of naval assets to do so.

In the face of the increasing number of attacks, in the face of the dangers posed to the crew, in the face of the dangers posed to the vessels and the huge financial losses, the IMO changed its stand by issuing circulars guiding ship owners on the use of armed guards on board vessels.

The effect of piracy on international shipping is course affecting vessels registered under the Malta flag and the flag administration was constantly being asked whether vessels flying the Malta flag are permitted to carry weapons on board.

Transport Malta’s policy is always to follow the direction of the International Maritime Organisation which until March 2011 meant a “no arms on board policy”.

With the publication of the circular and the change in tack, Transport Malta has been allowing the carriage of arms on board Maltese-registered vessels on a case-by-case basis, and following the proper application of a protocol. This situation was further reinforced by virtue of Legal Notice 9 of 2013 entitled the General Authorisation (Protective Security Measures on Board Ships) Regulations.

These regulations establish the general authorisation for the carriage and use of firearms and ammunitions on board Maltese vessels by armed guards authorised to have firearms and ammunition licensed to private maritime security companies. It is a general authorisation which only applies for “purposes considered necessary in the public interest or for the protection of life and security of persons.” The regulations’ thrust is to ensure that Maltese-flagged vessels must ensure that they have satisfactory procedures in place for the placement of armed guards on board their vessel.

The clear advantage of having professional armed guards on board a vessel to assist in anti-piracy measures is evident. To date, no vessel carrying armed guards has been hijacked. This speaks volumes. This has meant that the demand for private maritime security companies (PMSC) providing armed guards has mushroomed. It has also meant that international organisations such as BIMCO have had to come up with a standard contract to be used by ship owners and PMSC’s regulating the relationship between them called GUARDCOM.

It has however also meant that PMSC’s are also setting up shop in a number of jurisdictions. Malta is considered a jurisdiction of choice by a number of such companies. They are attracted to Malta by its EU membership, extremely stable regulatory regime and attractive corporate structures and, most importantly, because of the geographic position in the centre of the Mediterranean. Malta is on the thumb line from the Straits of Gibraltar to Suez and therefore considered an extremely reliable, stable and convenient port of call prior to a vessel entering Suez and at the start of what could be a harrowing journey.

In view of this Malta, as a leading maritime nation, has now gone a step further, leading by example in the licensing of these private maritime security companies. Strange as it may seem, and despite private maritime security companies having been established for many years in the UK and in other European countries, there seems to be an absence of a proper regulatory licensing framework. A proper framework would ensure these organisations, which are engaging in this highly sensitive and serious activity, are of calibre employing quality personnel having the highest standards and integrity.

Legal Notice 110/2013 entitled Licensing of Private Maritime Security Companies Regulations 2013 was published on March 8. This piece of legislation has yet again placed Malta on the international maritime map.

This is a unique piece of legislation which clearly lays down that no person shall carry out the business of a PMSC without a licence granted under the regulations. The regulations outline the parameters under which a private maritime security company incorporated in Malta may obtain a licence which includes more than 20 strict and strenuous criteria and obligations for the private maritime security company to comply with.

These strict parameters were, and are, highly desirable to ensure that those companies which are indeed licenced are serious, suitable, appropriate and responsible for this highly sensitive and demanding activity.

These criteria range from certified copies of the applicant’s insurance policies to proof of the applicant’s standard operating procedures, details of each of the personnel employed with proof of the necessary adequate qualifications training and past work experience, and proof of the implementation of a quality management system or risk management system as established by international accreditation bodies recognised by the international shipping community as being competent to carry out such accreditation.

The regulations provide for the setting up of a board which will administer the system composed of the Registrar General of Maltese Ships who will be the chairman of the board, a representative from the Police Force, Department of Customs, Ministry of Foreign Affairs, Trade Services and Security Services.

The board’s composition has been carefully designed to ensure that all the organs of government likely to have an involvement in the operation of such companies are represented to ensure the smooth operation of the system and to avoid precisely unnecessary bureaucratic bottlenecks which can be caused when an activity is dependent on a number of government departments.

This licensing regime puts Malta on the map because it has recognised, ahead of other countries, the need to regulate this highly sensitive industry which has gone down very well with the serious private maritime security companies determined to ensure that only the most serious service providers are allowed to operate. Another notch for Maritime Malta.

Ann Fenech is managing partner of Fenech & Fenech Advocates.


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