In this seaport of Athens, a simple action by the faraway Pacific kingdom of Tonga sent ripples of panic and consternation through seamen here and in about 200 vessels plying the world's oceans.
Tonga panicked and cancelled its flag of convenience registry here shortly after the Israeli navy seizure of the Tonga-flagged freighter Karine A. on Jan. 3. The Karine A was carrying 50 tons of weapons and munitions that Israel and the ship's Palestinian captain claim were destined for Yasser Arafat's beleaguered Palestinian Authority.
Then there was a 17-hour U.S. Navy search of another ship flying the red-and-white Tonga ensign, the Rasha J., in the Mediterranean near Sicily. The search revealed nothing suspicious, but still, it added to the swirl of suspicions surrounding an island whose reigning king is under media attack for allegedly harboring secret foreign bank accounts of more than $350 million.
That was the last straw for Tonga — which began flagging operations in December 2000 — a relative new member of a not-very-exclusive club of these havens.
These flag of convenience vessels are owned in one country — let's say the United States, Britain or Australia — and registered in havens like Liberia, Panama, Cyprus or even the Cayman Islands — to avoid international safety and tax regulations and maximize the shippers' profits.
American Seamen Feel Vindicated
As shipowners in Greece, the United States and other countries wrung their hands, the deputy ship registrar in Piraeus, where Tonga's ships were registered, said, "We feel picked on." But American seamens' unions and other bodies who perennially fight the flags of convenience chalked up what they felt was a minor victory.
Shipping company executives, writes Dr. Z. Oya Ozcayir, a Turkish maritime law consultant, "take all decisions in order to achieve the common aims of minimizing private costs and maximizing private revenue."
This is especially bad news for the dwindling merchant fleet: attracted by the low fees of the flagging states and their often-negligent regulations. Hundreds of owners of ships, from spiffy cruise vessels to ageing rust-bucket freighters, have abandoned the U.S. flag for exotic registries like Vanuatu, Cyprus, Belize or the Marshall Islands.
The biggest fleet in tonnage and number of vessels, was at last count administered by Panama, a country of about 2.7 million people that now controls the formerly U.S.-held Panama Canal, but which is still recovering from the U.S. invasion to oust dictator Manuel Noriega and imprison him on drug charges in Miami, Fla., in 1989.
The second largest is administered from an office building in Reston, Va., in the Washington, D.C., suburbs, on behalf of Liberia, the West African nation founded by ex-American slaves and still recovering from a 1990s civil war.
If you visit the ports in Houston, Los Angeles or Baltimore, you are more likely to see a Cypriot, Greek or Ukrainian flag on a freighter — even if the real owner is, say, an Australian or an American — than an American flag.
More than 90 percent of oceangoing cargoes entering or leaving U.S. ports move on foreign-flagged ships. Many of these ships, such as Greek-flagged and flag of convenience ships, officially called "open registry ships" and operating out of Piraeus and many other ports, employ low-wage seamen from developing states such as Pakistan, Burma, China or the Philippines.
A Trap of Their Own Making