US Navy to search Panamanian ships

The US Navy will be allowed to board Panamanian-registered commercial ships to search for weapons of mass destruction under a deal to be signed today. The agreement could help ease tensions sparked by US claims that Panama was failing to ensure that ships flying its ?flag of convenience? met tough new anti-terrorism measures. Thousands of Panamanian-flagged ships could be barred from US and European ports if they fail to meet the new requirements by July 1 and this poses a threat to the Central American nation’s economy.

Panama’s maritime industry earns $300 million a year and its registry accounts for 26% of the global fleet and licenses more ships and seafarers than any other nation. Unlike other flag states, Panama snubbed safety monitors like Lloyd’s Register and the American Bureau of Shipping to award monopoly control of its security certification programme to a little-known private company in Florida. The company, Phoenix Vessels Services, charges at least three times the fees set elsewhere for compliance reviews.

The exclusive deal has exposed Panamanian-registered vessels to more scrutiny by the US Coast Guard. Ships on the Panama registry already are designated priority targets for boarding because of the country’s record of lax enforcement. After the Sept. 11 attacks, the IMO adopted new security standards, requiring all vessels to work out plans to prevent terrorists, pirates, smugglers and stowaways from gaining access to ships or their cargo. By late April, only 60% of the 5,526 Panamanian-registered vessels subject to the new security constraints had been certified as complying. Maritime lawyers blame the slow pace of compliance on the government’s procedures, which require ship owners to hire one company to develop their security plans, another (Phoenix) to assess and approve them, and a third to get their certificates from the Panama Maritime Authority.