Misplaced Pages

#347652

70-487: Port state control (PSC) is an inspection regime for countries to inspect foreign-registered ships in port other than those of the flag state and take action against ships that are not in compliance. Inspectors for PSC are called PSC officers (PSCOs), and are required to investigate compliance with the requirements of international conventions, such as SOLAS , MARPOL , STCW , and the MLC . Inspections can involve checking that

140-460: A 2003 report by the Organisation for Economic Co-operation and Development (OECD) report entitled "Ownership and Control of Ships", these corporate structures are often multi-layered, spread across numerous jurisdictions, and make the beneficial owner "almost impenetrable" to law enforcement officials and taxation. The report concludes that "regardless of the reasons why the cloak of anonymity

210-416: A country, called its flag state . A ship is subject to the law of its flag state. It is usual to say that the ship sails under the flag of the country of registration. A ship's flag state exercises regulatory control over the vessel and is required to inspect it regularly, certify the ship's equipment and crew, and issue safety and pollution prevention documents. The organization which actually registers

280-400: A day. Ships operated illegally, such as by pirates , or narco-submarines , are not normally registered by the operators (although a registered ship may be captured or used covertly for illegal purposes). Flag of convenience Flag of convenience ( FOC ) is a business practice whereby a ship's owners register a merchant ship in a ship register of a country other than that of

350-580: A flag state be linked to its ships either by having an economic stake in the ownership of its ships or by providing mariners to crew the ships. To come into force, the 1986 treaty requires 40 signatories whose combined tonnage exceeds 25% of the world total. To date, only 14 countries have signed the treaty. National or closed registries typically require that a ship be owned by national interests, and at least partially crewed by its citizens. Open registries do not have such requirements; some offer on-line registration, and one guaranteed completion in less than

420-660: A genuine link between a ship's owners and its flag state dates back to 1958, when Article 5(1) of the Geneva Convention on the High Seas also required that "the state must effectively exercise its jurisdiction and control in administrative, technical and social matters over ships flying its flag." The principle was repeated in Article 91 of the 1982 treaty called the United Nations Convention on

490-630: A global environment. In 2010 in a message connected to the World Maritime Day , the Secretary-General of the International Maritime Organization gave recognition to the present status of the open registries and noted that the seafarers from some developing countries are providing major source of foreign currency to their home economies: "The development of open registries for ships has given

560-573: A jurisdiction with measurement rules that reduced the certified gross register tonnage of a ship, to reduce subsequent port of call dock dues. Such was a consideration when Carnival Cruise Line changed the flag of the RMS Empress of Canada in 1972 to that of Panama. In 2011, Cunard Line registered all its ships in Bermuda , which, besides other considerations, enabled its ship captains to marry couples at sea. Weddings at sea are described as

630-427: A lucrative market. Maritime industry practitioners and seafarers from other countries contend that this is a natural product of globalisation. Supporters of the practice, however, point to economic and regulatory advantages, and increased freedom in choosing employees from an international labour pool. Publications from as early as 1962 argue that shipowners from developed countries use the practice to be competitive in

700-695: A means of avoiding labor regulation in the country of ownership, and become a vehicle for paying low wages and forcing long hours of work and unsafe working conditions. Since FOC ships have no real nationality, they are beyond the reach of any single national seafarers' trade union." They also say that these ships have low safety standards and no construction requirements, that they "do not enforce safety standards, minimum social standards or trade union rights for seafarers", that they frequently fail to pay their crews, have poor safety records, and engage in practices such as abandoning crewmen in distant ports. While flag of convenience ships have been involved with some of

770-411: A neutral, unintentionally into war. The Liberian open registry, founded in 1948, was the brainchild of Edward Stettinius , who had been Franklin D. Roosevelt 's Secretary of State during World War II. Stettinius created a corporate structure that included The Liberia Corporation , a joint-venture with the government of Liberia. The corporation was structured so that 25% of its revenue would go to

SECTION 10

#1732782546348

840-416: A nominee director to divulge the identity of beneficial owners. A further hurdle is that some jurisdictions allow a corporation to be named as a director. Flag of convenience ships have long been linked to crime on the high seas. For example, in 1982, Honduras shut down its open registry operations because it had enabled "illegal traffic of all kinds and had given Honduras a bad name". Ships registered by

910-413: A nominee to be the shareholder, and that nominee cannot legally be compelled to reveal the identity of the beneficial owner. All corporations are required to have at least one director, however many jurisdictions allow this to be a nominee director. A nominee director's name would appear on all corporate paperwork in place of the beneficial owners, and like nominee shareholders, few jurisdictions can compel

980-529: A port state control officer (PSCO). Annual report of Paris MoU reported that a total of 74,713 deficiencies were recorded during port state control inspections in 2007, which deficiencies resulted in 1,250 detentions that year. Detention of the ship is the last course of action that a PSCO would take upon finding deficiencies aboard the vessel. Courses of action a PSCO may impose on a ship with deficiencies (in order of ascending gravity) are: The countries that implement PSC are referred to as port states . This term

1050-405: A registration fee. There must be a "genuine link" between a vessel and its flag state. Article 5(1) of the Geneva Convention on the High Seas of 1958, which came into effect in 1962, requires that "the state must effectively exercise its jurisdiction and control in administrative, technical and social matters over ships flying its flag." There are 63 states party to that Convention. The principle

1120-518: A result, flags of convenience perpetuate IUU fishing which has extensive environmental, social and economic impacts, particularly in developing countries. The EJF is campaigning to end the granting of flags of convenience to fishing vessels as an effective measure to combat IUU fishing. According to Franz Fischler , European Union Fisheries Commissioner , The practice of flags of convenience, where owners register vessels in countries other than their own in order to avoid binding regulations or controls,

1190-596: A ship violates the 0.5% sulphur limit of MARPOL Annex VI , assert jurisdiction for such violations which occur on the high seas . The extraterritorial jurisdictional basis for such enforcement and sanctioning is found within the special provisions of part XII of the United Nations Convention on the Law of the Sea ( UNCLOS ). Ship registration International law requires that every ship be registered in

1260-534: A ship, the port state may take actions including detaining the ship . In 2015, member states of the Paris MOU conducted 17,858 inspections with deficiencies, which resulted in 595 detained vessels and 11 banned. Member states of the Tokyo Memorandum of Understanding conducted 17,269 ship inspections in 2015, recording 83,606 deficiencies which resulted in 1,153 detentions. The principle that there be

1330-411: A total of 1,041,986,000  DWT : more than 46% of the world's shipborne carrying capacity. The following table gives the distribution between the 10 largest world registries in terms of tonnage (millions dwt): Source: UNCTAD (estimates based on data supplied by Clarkson Research Services ). The data refer to the beginning of an indicated year. In comparison, the total capacity of ships in

1400-656: Is a serious menace to today's maritime world. In 1978, a number of European countries agreed in The Hague to audit labour conditions on board vessels vis-a-vis the rules of the International Labour Organization . To this end, in 1982 the " Paris Memorandum of Understanding on Port State Control " (Paris MOU) was established, setting port state control standards for what is now twenty-six European countries and Canada. Several other regional Memoranda of Understanding have been established based on

1470-581: Is a ship's flag state and determines its nationality as well as which country's laws govern its operation and the behavior of its crew. A country will specify legal requirements for registration of a ship in its domestic laws, for example, in the UK, the Merchant Shipping Act 1995 details British law on entitlement for ship registration, including qualifications, pre-conditions and the machinery for registration. Each registry has its own rules as to

SECTION 20

#1732782546348

1540-461: Is involved in a case under admiralty law . A ship's owners may elect to register a ship in a foreign country so as to avoid the regulations of the owners' country, which may, for example, have stricter safety standards. They may also select a jurisdiction to reduce operating costs, avoiding higher taxes in the owners' country and bypassing laws that protect the wages and working conditions of mariners . The term "flag of convenience" has been used since

1610-452: Is its flag state , and the flag state gives the ship the right to fly its civil ensign. A ship operates under the laws of its flag state, and these laws are used if the ship is involved in an admiralty case. A ship's flag state exercises regulatory control over the vessel and is required to inspect it regularly, certify the ship's equipment and crew, and issue safety and pollution prevention documents. The organization which actually registers

1680-427: Is made available, if it is provided it will also assist those who may wish to remain hidden because they engage in illegal or criminal activities, including terrorists." The OECD report concludes that the use of bearer shares is "perhaps the single most important (and perhaps the most widely used) mechanism" to protect the anonymity of a ship's beneficial owner. Physically possessing a bearer share accords ownership of

1750-587: Is not our concern." Less than two years later, French forces seized the Cambodian-flagged, Greek-owned MV Winner for cocaine smuggling. Shortly after the seizure, Cambodian Prime Minister Hun Sen closed the registry to foreign ships, and Cambodia canceled its contract with CSC shortly thereafter. The North Korean flag of convenience has also garnered significant scrutiny. In 2003, the North Korean freighter Pong Su reflagged to Tuvalu in

1820-567: Is that shipowners who want to hide their ownership may select a flag-of-convenience jurisdiction which enables them to be legally anonymous. Some ships with flags of convenience have been found engaging in crime, offering substandard working conditions, and negatively impacting the environment, primarily through illegal, unreported and unregulated fishing . Prior to the implementation of the International Convention on Tonnage Measurement of Ships, 1969 , shipowners may have selected

1890-506: The ITF says: Arms smuggling, the ability to conceal large sums of money, trafficking in goods and people and other illegal activities can also thrive in the unregulated havens which the flag of convenience system provides. Panama has the largest maritime register, followed by Liberia. Landlocked Mongolia also has a major registry, as does Bolivia. Also, some registers are based in other countries. For example, Panamanian overseas consulates manage

1960-932: The United Kingdom with the world's largest ship register. Traditional maritime nations, mainly from Europe, responded to this practice with creation of so called " second registers " - open registries, using national flags or flags of semi-sovereign offshore dependencies. That process begun in 1984 with the Isle of Man registry created as a second UK register. Soon after Norway and the Netherlands followed this practice adopting Netherlands Antiles and Norwegian International Ship Register (NIS) respectively. France established in 1989 Kerguelen Islands Register (replaced by International French Register ( Registre International Français - RIF in 2005 ) and Germany (Federal Republic of) created German International Register (GIS) in

2030-569: The United States when shipowners seeking to serve alcohol to passengers during Prohibition registered their ships in Panama. Owners soon began to perceive advantages in terms of avoiding increased regulations and rising labor costs and continued to register their ships in Panama even after Prohibition ended. The use of open registries steadily increased, and in 1968, Liberia grew to surpass

2100-484: The "degree of ratification and enforcement of ILO Conventions and Recommendations," and "safety and environmental record". As of August 2024 , the list includes 43 registries. As of 1 January 2024 , Liberia, Panama and the Marshall Islands are the world's three largest registries in terms of deadweight tonnage (DWT). These three nations registered 17,752 ships of 1,000  DWT and above, for

2170-402: The 1950s. A registry which does not have a nationality or residency requirement for ship registration is often described as an open registry . Panama, for example, offers advantages such as easier registration (often online), the ability to employ cheaper foreign labour, and an exemption on income taxes. The modern practice of ships being registered in a foreign country began in the 1920s in

Port state control - Misplaced Pages Continue

2240-418: The 1982 Paris Memorandum of Understanding on Port State Control or Paris MOU. Under port state control , ships in international trade became subject to inspection by the states they visit. In addition to shipboard living and working conditions, these inspections cover items concerning the safety of life at sea and the prevention of pollution by ships. In cases when a port state inspection uncovers problems with

2310-658: The American company SeaLand 's fleet of 63 ships were foreign-flagged, saving the company up to US$ 3.5 million per ship every year. The environmental disaster caused by the 1978 sinking of the MV ; Amoco Cadiz , which flew the Liberian flag, spurred the creation of a new type of maritime enforcement. Resulting from strong political and public outcry over the Amoco Cadiz sinking, fourteen European nations signed

2380-701: The Cambodia Shipping Corporation (CSC) were found smuggling drugs and cigarettes in Europe, breaking the Iraq oil embargo, and engaging in human trafficking and prostitution in Europe and Asia. In response to these activities, in 2000, Ahmad Yahya of the Cambodian Ministry of Public Works and Transport told industry publication Fairplay "We don't know or care who owns the ships or whether they're doing 'white' or 'black' business ... it

2450-509: The FOC flag states lack the resources or the will to properly monitor and control those vessels. The Environmental Justice Foundation (EJF) contends that illegal, unreported and unregulated fishing (IUU) vessels use flags of convenience to avoid fisheries regulations and controls. Flags of convenience help reduce the operating costs associated with illegal fishing methods, and help illegal operators avoid prosecution and hide beneficial ownership. As

2520-515: The Law of the Sea and often referred to as UNCLOS. In 1986, the United Nations Conference on Trade and Development attempted to solidify the genuine link concept in the United Nations Convention on Conditions for Registration of Ships . The Convention for Registration of Ships would require that a flag state be linked to its ships either by having an economic stake in the ownership of its ships or by providing mariners to crew

2590-537: The Liberian government, another 10% went to fund social programs in Liberia, and the remainder returned to Stettinius' corporation. The Liberian registry was created at a time when Panama's registry was becoming less attractive for several reasons including its unpopularity with the U.S. labor movement and European shipping concerns, political unrest in Panama, and increases in its fees and regulations. On 11 March 1949, Greek shipping magnate Stavros Niarchos registered

2660-850: The Paris MOU, several other regional MOUs have been signed, including the Tokyo MOU (Pacific Ocean), Acuerdo Latino or Acuerdo de Viña del Mar (South and Central America), the Caribbean MOU , the Mediterranean MOU, the Indian Ocean MOU, the Abuja MOU (West and Central Atlantic Africa), the Black Sea MOU, and the Riyadh MOU (Persian Gulf). The port state control (PSC) makes inspection of ships in port, taken by

2730-877: The Paris model, including the " Memorandum of Understanding on Port State Control in the Asia-Pacific Region ", typically referred to as the "Tokyo MOU", and organizations for the Black Sea, the Caribbean, the Indian Ocean, the Mediterranean, and Latin America. The Tokyo and Paris organizations generate, based on deficiencies and detentions, black-, white-, and grey-lists of flag states. The US Coast Guard , which handles port state control inspections in

2800-576: The Seamen's Act, Panamanian-flagged ships in this early period paid sailors on the Japanese wage scale, which was much lower than that of western merchant powers. In the early phase of World War II the transfer of American-owned ships to the Panama registry was sanctioned by the United States government so that they could be used to deliver materials to Britain without dragging the United States, as

2870-403: The U.S. and U.K. registers as of 1 January 2024 is 13.2 mil. dwt and 11.1 mil. dwt respectively. There are a number of common threads found in criticisms of the flag of convenience system. One is that these flag states have insufficient regulations and that those regulations they do have are poorly enforced. Another is that, in many cases, the flag state cannot identify a shipowner, much less hold

Port state control - Misplaced Pages Continue

2940-577: The US, maintains a similar target list for underperforming flag states. As of August 2024 , it could be said that the 6 major FOC registries in terms of tonnage (representing more than half of the world tonnage) are performing pretty well in respect of PSC inspections: tonnage Sources: International Chamber of Shipping (ICS) , Paris MoU , Tokyo MoU , USCG Both Paris and Tokyo MoU-s maintain black lists of low performing flags, but there are FOC and non-FOC registries among them. Panama has

3010-718: The United States to strengthen the United States Merchant Marine and provide safeguards for its mariners. During this period, U.S.-flagged ships became subject to regular inspections undertaken by the American Bureau of Shipping . This was also the time of Robert LaFollette 's Seamen's Act of 1915 , which has been described as the " Magna Carta of American sailors' rights". The Seamen's Act regulated mariners' working hours, their payment, and established baseline requirements for shipboard food. It also reduced penalties for disobedience and abolished

3080-432: The availability of preferred mortgages on documented vessels. Vessels that operate internationally or cross international borders are required to be registered. Some jurisdictions also require vessels that only operate in territorial waters to register on their national register, and some forbid foreign-flagged vessels from trading between ports within the country (a practice known as cabotage ). The country of registration

3150-608: The civil war of 1990, Liberia joined with the Republic of the Marshall Islands to develop a new maritime and corporate program. The resulting company, International Registries , was formed as a parent company, and in 1993 was bought out by its management. After taking over the Liberian government, Americo-Liberian warlord Charles Taylor signed a new registry contract with the Liberian International Ship and Corporate Registry , commonly known as LISCR. LISCR

3220-431: The corporation. There is no requirement for reporting the transfer of bearer shares, and not every jurisdiction requires that their serial numbers even be recorded. Two similar techniques to provide anonymity for a ship's beneficial owner are "nominee shareholders" and " nominee directors ". In some jurisdictions that require shareholder identities to be reported, a loophole may exist where the beneficial owner may appoint

3290-610: The documentation and collect registration fees, Liberia's registry is managed by a company in Virginia and Bahamas' from the City of London. A ship's beneficial owner is legally and financially responsible for the ship and its activities. For any of a number of reasons, some justifiable and some suspicious, shipowners who wish to conceal their ownership may use a number of strategies to achieve that goal. In jurisdictions that permit it, actual owners may establish shell corporations to be

3360-503: The entire world fleet by deadweight tonnage , maintaining roughly the same proportion for over a decade. The International Transport Workers' Federation (ITF) is the biggest campaigner against FOC since 1948, and maintains a list of registries it considers to be flags of convenience. In developing the list, the ITF takes into account "ability and willingness of the flag state to enforce international minimum social standards on its vessels,"

3430-619: The first ship under the Liberian flag, World Peace . When Stettinius died in 1949, ownership of the registry passed to the International Bank of Washington , led by General George Olmsted . Within 18 years, Liberia grew to surpass the United Kingdom as the world's largest register. Due to Liberia's 1989 and 1999 civil wars , its registry eventually fell second to Panama's flag of convenience, but maritime funds continued to supply 70% of its total government revenue. After

3500-738: The flag of the fledgling United States quickly found it offered little protection against attack by Barbary pirates – many responded by seeking to transfer their registry back to Great Britain. The use of false flags was frequently used as a ruse de guerre by the British during the Napoleonic Wars and the United States during the War of 1812 . During the mid-19th century, slave ships flew various flags to avoid being searched by British anti-slavery fleets . The Belen Quezada , in August 1919,

3570-759: The highest-profile oil spills in history (such as the Maltese-flagged MV ; Erika , the Bahamian-flagged MV ; Prestige , the Marshallese-flagged Deepwater Horizon , and the Liberian-flagged SS ; Torrey Canyon , MV  Amoco Cadiz and MV  Sea Empress ), the most common environmental criticism they face regards illegal fishing . These critics of the flag of convenience system argue that many of

SECTION 50

#1732782546348

3640-518: The legal owners of their ships, making it difficult, if not impossible, to track who is the beneficial owner of the ship. The 2004 Report of the UN Secretary General's Consultative Group on Flag State Implementation reported that "It is very easy, and comparatively inexpensive, to establish a complex web of corporate entities to provide very effective cover to the identities of beneficial owners who do not want to be known." According to

3710-613: The middle of a voyage shortly before being seized by Australian authorities for smuggling heroin into that country. That year, thirteen nations began monitoring vessels under the North Korean flag for "illicit cargos like drugs, missiles or nuclear weapon fuel". In the accompanying material of the ILO's Maritime Labour Convention of 2006 , the International Labour Organization estimated that at that time there were approximately 1,200,000 working seafarers across

3780-414: The owner civilly or criminally responsible for a ship's actions. As a result of this lack of flag state control, flags of convenience are criticized on grounds of enabling tax avoidance, providing an environment for conducting criminal activities, supporting terrorism, providing poor working conditions for seafarers, and having an adverse effect on the environment. David Cockroft, former general secretary of

3850-495: The practice of imprisoning sailors for the offense of desertion. Another aspect of the Seamen's Act was enforcement of safety standards, with requirements on lifeboats, the number of qualified able seamen on board, and that officers and seamen be able to speak the same language. These laws put U.S.-flagged vessels at an economic disadvantage against countries lacking such safeguards, and ships started to be re-registered in Panama's open registry from 1919. In addition to sidestepping

3920-492: The same year. Last two registries are still (2024) considered as FOC-s. As of 2024 , more than half of the world's merchant ships in terms of deadweight tonnage are registered in open registries or FOC-s. Open registries have been criticised, mainly by trade union organisations based in developed countries, especially those in the European Union, United States, Japan, Canada, or the United Kingdom. One criticism

3990-488: The seas has been important. Originally meant to control ships carrying cargo in European seafaring countries, it was used to make sure ships were being built in the local country, with crews predominantly of the local country. Since then, ship registration has been used to document ships for ownership. Documentation provides definite evidence of nationality for international purposes and provides financing opportunities with

4060-518: The ship is known as its registry. Registries may be governmental or private agencies. In some cases, such as the United States' Alternative Compliance Program, the registry can assign a third party to administer inspections. A register that is open only to ships of its own nation is known as a traditional or national register . Registers that are open to foreign-owned ships are known as open registries and are sometimes called flags of convenience . Ship registration has been done since business on

4130-744: The ship is known as its registry. Registries may be governmental or private agencies. The reasons for choosing an open register are varied and include tax avoidance , the ability to avoid national labor and environmental regulations, and the ability to hire crews from lower-wage countries. National or closed registries typically require a ship be owned and constructed by national interests, and at least partially crewed by its citizens. Conversely, open registries frequently offer on-line registration with few questions asked. The use of flags of convenience lowers registration and maintenance costs, which in turn reduces overall transportation costs. The accumulated advantages can be significant, for example in 1999, 28 of

4200-402: The ship's owners, and the ship flies the civil ensign of that country, called the flag state . The term is often used pejoratively, and although common, the practice is sometimes regarded as contentious. Each merchant ship is required by international law to be registered in a registry created by a country, and a ship is subject to the laws of that country, which are used also if the ship

4270-404: The shipping industry the flexibility to recruit its manpower from alternate sources, with the result that developing and newly industrialized countries now provide the majority of seafarers for the entire global fleet – not just for the ships flying their own country's flag." International law requires that every merchant ship be registered in a country. The country in which a ship is registered

SECTION 60

#1732782546348

4340-619: The ships. To come into force, the 1986 treaty requires 40 signatories whose combined tonnage exceeds 25% of the world total. As of 2017 , only 14 countries have signed the treaty. Merchant ships have used false flags as a tactic to evade enemy warships since antiquity, and examples can be found from as early as the Roman era through to the Middle Ages . Following the American Revolutionary War , merchantmen flying

4410-466: The types of vessels that it will accept for registration. The Liberian Registry, for example, registers seagoing vessels of more than 500 net tons that conduct foreign trade. Vessels over the age of 20 require a waiver as well as the vessel's classification society being willing to issue statutory certificates to the vessel. Vessels 15 years or older must have a Status Report of the vessel's Special Survey to be reviewed by Marine Safety. Registries charge

4480-593: The vessel is crewed and operated in compliance with applicable international law, and verifying the competency of the ship's master and officers, and the ship's condition and equipment. In 1978 , a number of European countries agreed in The Hague on a memorandum for the audit of labour conditions on board vessels as to whether they were in accordance with the rules of the ILO . After the Amoco Cadiz sank that year, it

4550-443: The world. This document goes on to say that when working aboard ships flagged to states that do not "exercise effective jurisdiction and control" over their ships that "seafarers often have to work under unacceptable conditions, to the detriment of their well-being, health and safety and the safety of the ships on which they work." The International Transport Workers' Federation goes further, stating that flags of convenience "provide

4620-607: Was decided to also audit safety and pollution practices. To this end, in 1982 fourteen European countries agreed on the Paris Memorandum of Understanding on Port State Control (Paris MoU) to establish port state control. Currently, 26 European countries and Canada are signatories of Paris MoU. PSC was a reaction to the failure of those flag states  – especially flag of convenience states – that had delegated their survey and certification responsibilities to classification societies . Modeled on

4690-527: Was established in UNCLOS , but the approach had been applied since ancient times. Port states effectively establish jurisdiction over foreign-flagged seagoing vessels visiting the ports of a port state. This jurisdiction is distinct from the one set up by the coastal states in their maritime zones , primarily due to two considerations: Port states can, in addition to detention, sanction violations with fines. Port states can also in certain cases, for example if

4760-483: Was one of the few legal sources of income for Taylor's regime. Liberia's registry is operated from Virginia, United States. To counteract class hopping , in 2009 the International Association of Classification Societies (IACS) established a Transfer of Class Agreement (TOCA). As of August 2024 , the open registries of Panama, Liberia, and Marshall Islands accounted for more than 46% of

4830-434: Was repeated in Article 91 of the United Nations Convention on the Law of the Sea of 1982 (UNCLOS), which came into effect in 1994. That Convention has 167 parties. In 1986, the United Nations Conference on Trade and Development attempted to solidify the genuine link concept in the United Nations Convention on Conditions for Registration of Ships . The Convention on Conditions for Registration of Ships would require that

4900-518: Was the first foreign ship to be re-registered in the Panamanian registry, and was employed in running illegal alcohol between Canada and the United States during Prohibition . The modern practice of registering ships in foreign countries to gain economic advantage originated in the United States in the era of World War I , though the term "flag of convenience" did not come into use until the 1950s. Between 1915 and 1922, several laws were passed in

#347652