Thank you for writing in to us. You have raised some excellent queries with respect to shipping and vessel mortgage registrations in Bangladesh. I will endeavour to answer your queries briefly within the following paragraphs. Please note that shipping and mortgage registrations in Bangladesh have to be duly registered. Additionally, the obligations and rights of all the parties involved largely rests on the Agreement within the parties too. In the instance of shipping mortgages, the situation will be governed by a culmination of three areas of law: Shipping law, Banking law and Contract law.
Yes, a vessel owned by a national of Bangladesh must register the vessel in Bangladesh under the Bangladesh Merchant Shipping Ordinance 1983.
No, a ship capable of being registered in Bangladesh must belong to a statutory corporation or be a vessel acquired and owned by a foreign national or company and leased out to the Government or a citizen of Bangladeshi or a Bangladesh company. This ought to be done under such an agreement that the ownership of the ship shall be transferred after a specified period of time to the Government or such citizen or company in accordance with the terms of the agreement.
Another requirement is that the ship must be owned wholly by persons each of whom is-
(a) a citizen of Bangladesh, or
(b) a company which fulfils the following conditions, namely:-
(i) the principal place of business of the company is in Bangladesh,
(ii) shares representing more than fifty per cent of the share capital of the company or shares carrying more than fifty per cent of the total voting power of the company are held by citizen of Bangladesh,
(iii) the majority of the directors of the company are citizens of Bangladesh,
(iv) Either the Chairman or the Managing Director of the Board of Directors of the company is a citizen of Bangladesh.
The Flag Vessel Protection Ordinance 1982 confers restrictions on foreign ships regarding trade of Bangladeshi cargoes. This is to protect the interests of Bangladeshi shippers. Also no owner of a Bangladesh flag ship shall join or form a liner conference without obtaining a license from the Prescribed Authority.
In Bangladesh, carriage of goods by sea is governed by the Bills of Lading Act 1856, the Carriage of Goods by Sea Act 1925, the Merchant Shipping Ordinance 1983 and other general statutes. Trade restriction, for Bangladeshi ships, is governed generally by these statutes. Obviously import restrictions apply in relation to illegal goods i.e. drugs etc. Also it must be ensured that ships are not overloaded (or faulty and requires immediate repairs), or they may be detained from sailing, till that is rectified.
I hope the above provide some insight into the matter of shipping registration in Bangladesh and also about the trade restrictions that you were querying about. Please note that shipping is a complex area and it is therefore advised that adequate legal advice is obtained prior to any form of shipping mortgages or shipping transactions. Please do not therefore hesitate to get in touch if you require any more in-depth information, or any clarification. Till next week, Ciao!
Jennifer Ashraf is a barrister and solicitor of England and Wales. She is currently Senior Partner at Legacy Legal Corporate