German authorities are working on a reform of the flag state administration. With this, they aim to encourage more shipping companies than before to use the German flag for their ships. This was announced by the involved Federal Maritime and Hydrographic Agency (BSH) from Hamburg to the German Press Agency according to a report from February 23. International law stipulates that ships belong to the state whose flag they fly. Therefore, under the German flag, for example, German labor law applies.
Proportion of Foreign Flags at Around 85 Percent
Most ships in the German merchant fleet sail under a foreign flag, which is possible under certain conditions. At the end of last year, according to BSH figures, it was 1,417 out of 1,675, or nearly 85 percent. In 2014, the figure was about 88 percent, and ten years earlier, 75.8 percent. One important reason is lower costs.
Central Service Center Planned
The Federal Ministry of Transport initiated the reform. The Ship Safety Division, which, like the BSH, is based in Hamburg, is also involved in the reform. The authorities plan to establish a central service center for shipping companies and seafarers in the future. Currently, there are multiple responsible bodies. How the reform progresses will also depend on the new federal government and the new leadership of the Federal Ministry of Transport, according to the BSH.
Shipowners Support Initiative
The Association of German Shipowners from Hamburg, which represents around 200 companies in the industry, supports the reform. "The German flag needs to be made overall more attractive and internationally competitive in order to compete with other major flag states," the association stated in a statement to the German Press Agency. The German flag state administration is still too bureaucratic in international comparison. Additionally, special regulations cause unnecessary costs.
German Flag Ranks 21st in Ranking
In international comparison, the German flag ranks relatively well despite the disadvantages mentioned by the association. The organization of the Paris Memorandum of Understanding on Port State Control lists the flag in an international ranking at 21st place out of 71. Denmark, the Netherlands, and Norway occupy the top positions.
Germany's merchant fleet is among the most important in the world. According to the UN Conference on Trade and Development, Germany ranks seventh worldwide in terms of ship tonnage by ownership. Greece, China, and Japan hold the top positions.
