What A Difference A Flag Makes - Choice Of Flag By Shipowner

Choosing the right flag

The choice of flag can have far reaching consequences for a shipowner. It involves a consideration of fiscal and corporate rules and regulations, often covering the laws of more than one country. It may even affect the ability of the shipowner to raise money.

These are some of the factors which a shipowner may need to consider when selecting a flag for one of his vessels. It may not be appropriate for all of a shipowner's vessels to fly the same flag: it may be preferable to hedge the risk of industrial action by seamen of one nationality, or political strife by dividing a fleet between several flags. Equally, it may be necessary for trading or regulatory reasons for vessels to fly a specific flag. In some countries shipowners may be able (by negotiation or under publicised rules or scales) to obtain rebates or reductions in tonnage taxes and/or registration fees if they register a substantial number and tonnage of vessels under that flag.