Bermuda’s shipping registry has fallen foul of international quality standards and could face restrictions by the UK Government.

At issue is Bermuda’s failure to recruit enough of the highly specialized professionals required to maintain the yacht register and implement their new aviation registry.

Members of the Red Ensign Group — those shipping registers authorized to fly the British flag — must maintain enough in-house shipping surveyors to conduct at least 90 percent of critical safety management inspections of their ships.

Bermuda’s complement of ship surveyors can only meet 32% of the ship inspection requirements, and so it would have to double the number of ship surveyors in order to meet international standards.

“We’re working with the Department of Maritime Administration to rectify the situation and bring Bermuda back into compliance as soon as possible because it [the shipping registry] is an important revenue generator for Bermuda and there are reputational issues involved,” Economic Development Minister Grant Gibbons said.

It is not clear where the money will come from to get the shipping registry’s staffing complement up to speed — no money was budgeted for the purpose for the new fiscal year.
The UK’s Maritime and Coastguard Agency audits Bermuda Department of Maritime Administration every four years, but it is unclear how long Bermuda’s shipping registry has been non-compliant.

“During a February 2012 audit of the DMA undertaken by the MCA, the auditors identified the urgent need to engage additional surveyor resources, for the Bermuda Shipping Register to be able to meet its obligations and to function as a Category 1, Red Ensign Group Register in accordance with the agreed REG policies,” Dr Gibbons told the Bermudan Parliament recently.

As a category one register, the Island can register vessels of any size or type, but staffing requirements are dependent on the number of ships of various categories on the register.
UK authorities could impose limits on the number of ships in Bermuda’s fleet — thwarting plans to expand the business — if the issue is not addressed.

Government also plans to open a satellite office in London to be able to provide shipping inspection services at a lower rate and promote the registry in Europe, the Middle East and the Far East.

Shipping Registers By Numbers

The shipping registers are serious cash sources for any government. Each of them earns about double the costs of operation and there’s promising growth potential.

• Bermuda has four full time ship surveyors, compared to other members of the Red Ensign Group like the Isle of Man which has 17, and the Cayman Islands and Gibraltar which have 10 each.
• Of Cayman’s ten surveyors three are based there, six in the UK and one in Greece.
• The Bermuda register currently has 168 ships — 28 Passenger Ships, 44 Gas Tankers, 16 Oil Tankers, seven Chemical Tankers, 29 Bulk Carriers, 16 Container ships, and another 28 other types of ships. Another 258 yachts are registered there — 14 large commercial yachts and 244 pleasure yachts.
• In comparison, 1,900 vessels fly the Cayman Islands flag.