The Philosophy of Shipping Regulation

Insight, Legal — By on January 28, 2015 at 5:51 PM
John A. Economides

John A. Economides

The Philosophy of Shipping Regulation

by John A. Economides*

“The implementation of shipping rules, regulations and standards cannot be more interruptive or disruptive (technically or economically) of the ships’ operational continuity than the precise marine risks it aims to reduce or remove”.

Motor ships are large mobile floating devices with mechanical propulsion systems. The technical – mechanical function provides continuity of shipping operations in variable water and weather conditions. This continuity enables the orderly (recurring) execution of sea voyages and the regular performance of transportation work. Commercial transportation is the main economic function of ships.

Operational wear and tear progressively degrades the technical and mechanical structures and organizations (of ships). Wear and tear leads to technical and mechanical failures (damages and casualties). The (potentiality of the) occurrence of technical failures is expressed in marine risk. The occurrence of marine risk causes interruptions and disruptions in the regularity and recurrence of shipping operations and so in the continuity of the economic exploitation of the ships.

Degradation of hull and machinery is contained by technical maintenance and repair which are integral in shipping operations and extend the lives of marine systems. The technical and economic optimization (efficacy and efficiency) of maintenance and repair is provided by surveys which determine the general and particular running state of the ships.

The classification of the technical condition of the ships (hull and machinery) via independent survey and certification commenced as a practice to assess marine risk for insurance purposes. The assessment (scaling) of that risk and its association with the insurance cost provided direct economic incentive for the regular maintenance of the ships.

Induced (regular) maintenance reduced random structural and technical failures and increased the ships’ operational performance. Increased safety and security of transportation ensured continuity and enhanced the ships commercial and financial attractions. Classification provided the particular association of technical condition with economic performance from which the shipping industry benefited considerably.

Advancing economic and technological conditions of the late ‘80s early ‘90s called for increased control of marine risk by the development of quality standards for the operation and integrity of ships. Quality standards are uniform practices (systems) which aim to improve such conditions and preserve the continuity of shipping operations by the reduction or removal of marine risk. The establishment, validation and compliance of such quality standards were undertaken by the classification societies and especially by the International Association of Classification Societies (IACS) which developed relevant unified requirements and other quality rules on ships’ survey and certification.

At the same time the call for increased control of marine risk was shared by rising social considerations such as the safety of life at sea and the protection of the marine environment. For this reason quality standards were incorporated in international shipping regulation. Such regulation was provided chiefly by the IMO and enforced by the ships’ flag states via their registries and by the states of ships calls via their port state controls.

The successful combination of transportation efficacy with economic efficiency is the ultimate right and responsibility of discretionary ship management. Nevertheless international regulations and classification standards shape much of the current ship management framework. Compulsory conformity increases the ship managers’ reliance on rules and standards and entices their use as devices (information tools) for the control and containment of marine risks.

Concurrently the determination and observation of rules and standards leads also to the development of liabilities derivative from their institution and enforcement. More specifically the adoption of quality standards expands the operational engagement of classification societies from quantification to qualification of marine risk. That expansion and the commission of classification societies as independent servicers / external superintendents for survey and certification under the prescribed standards, increases the exposure of classification societies’ to legal liabilities. The classification’s (certification’s) liabilities increase towards third parties but more increase towards the shipowners.

At all times, the orderly (recurring) execution of sea voyages by ships remains the predominant seafaring and ship management operation. Quality standards, rules and regulations service the ships’ operational continuity. The implementation of such regulations and standards cannot be more interruptive or disruptive (technically or economically) of that operational continuity than the precise maritime risks it aims to reduce or remove.

John A. Economides is an attorney in Greece – partner in the law firm Aristides Economides & Co in Athens. In the late ‘80s he launched an initiative together with other young shipping professionals for the establishment of Hellenic Shipmanagement Principles. In addition to the shipping law practice he engages in philosophy. He is author of the comprehensive philosophical treatise published in Greek 2010 under the title “The Theory of Cosmos” and in English 2012 under the title “The Universe of Interactions”. 

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