Cyprus shipping in the spotlight

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Cyprus-based shipowners and ship-managers advocate shipping need to be governed by global regulations and not local or regional rules that create unfair competition in the industry.

Lobby groups such as the Cyprus Shipping Chamber represent the vast majority of the maritime sector, and the Cyprus Union of Shipowners ‘strongly advise’ their members to abide by UN-imposed and EU sanctions, especially when it comes to dealing with rogue states.

Cyprus shipping was recently criticised after a Maritime Intelligence report by Lloyd’s List revealed that ten mainly Greek-owned crude cargo vessels were re-registered under the Cyprus flag to avoid violating US sanctions on Venezuelan oil exports.

“The influx of tanker tonnage to the Cyprus flag registry, the world’s 11th-largest, signals a strategic shift from owners and the Republic of Cyprus and tests the limits of US enforcement,” the news report suggested.

“US sanctions, first imposed on Venezuela January 2019, have restricted or limited trade with its government or its state oil company Petroleos de Venezuela, SA (PDVSA).

“However, the legal position of non-US persons or companies without links to the US is opaque.

“Although the EU has imposed sanctions on some Venezuelan citizens, unlike the US, these do not directly cover Venezuela’s oil and shipping sector,” the report’s author said.

The [Cyprus] deputy shipping ministry told Lloyd’s List the Republic of Cyprus was only committed to enforcing European Union and United Nations sanctions and not those imposed by the US.

Cyprus “has no competence or legal basis for enforcing sanctions that have not been imposed by either the UN or the EU,” the ministry said in an emailed response.

Greeks lifted 80% of Venezuela crude

The Lloyd’s List report said, “until last year, Greek shipowners accounted for 80% of crude lifted from Venezuela, undeterred by US sanctions.

“Then, six vessel-owning companies connected with four prominent owners were briefly blacklisted for breaching US sanctions, forcing all Greek-owned vessels involved in these trades to rethink and recalibrate business plans.”

Industry monitors told the Financial Mirror the ships in question are regarded as ‘elderly’ and probably destined for withdrawal over the next few years.

They said not all vessels are dedicated to lifting Venezuelan crude all of the time throughout the year.

The CSC said its members are fully advised on UN and EU sanctions or other regulations and are ‘strongly advised’ by the Chamber or the Deputy Ministry to abide by these rules.

“We have never received any complaint all these years by any (multinational) agency of any of our fellow members violating any legally approved sanctions,” a CSC member told the Financial Mirror.

Although dealing with reducing emissions, seafarer’s health, and safety amid the pandemic, security, and piracy issues, the authorities closely cooperate, with the US embassy, especially on matters related to sanctions.

Officially, the CSC has not received any complaint on any of its members possibly violating US sanctions.