TNAG-0323-FCO40-359-Legislation-for-merchant-shipping-registered-in-Hong-Kong-1971 — Page 159

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Sir Hugh Norman-Walker,'

Colonial Secretariat, Lower Albert Road,

HONG

KONG.

ben Sir Hugh,

D.E.S.

At last a formal

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live an interm. ack. I possible.

21st Floor, Prince's Building Hong Kong

Tel: H-242111

13th Feb., 1971.

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ASE 5

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16/2.

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I just returned from a succession of overseas trips and must apologize for letting such a long time elapse before replying to your en- quiries during the dinner you so kindly' hosted on 3rd Dec., 1970 on the matter of Hong Kong as a country of ship registration.

As you may know, the most obvious factor which prompts shipowners to register their vessels under so-called flags of convenience is the considerable tax relief they offer but I should say that the more important advantage of such an arrangement is the latitude they give owners in their ships' manning. Under the present Hong Kong Merchant Shipping (Aliens Employment) Ordinance only British subjects in possession of Ministry of Transport certificates are allowed to serve as Masters, Chief Engineers, Second Engineers, Chief Officers, Second Officers and even Radio Officers on U.K. registered ships and this is an extremely difficult condition for shipowners to meet in view of the present dearth of qualified British personnel. No such rigid requirement is however imposed by a flag of convenience, notably Liberian or Panamanian, and this is de- finitely an attraction to a shipowner who then has a much easier manning problem to face.

Another factor, though a minor one, which stands in the way of British registration is the fastidious requirements imposed by the Ministry of Transport on crew accommodation and other structuralspeci- fications on board the vessels all of which result in much higher building and maintenance costs whereas with flags of convenience, such specifications are much less demanding and less costly. You may also like to know that some U.K. structual specifications and safety fittings requirement are based on considerations that are slightly out of keeping with world trend and in some cases the material and appliances required to meet such specifications are only available in U.K. but out of reach of the Japanese shipbuilders.

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