Report from the Commission to the Council on the implementation of Council Regulation 3577/92 applying the principle of freedom to provide services to maritime cabotage (1995-1996) and on the economic and social impact of the liberalization of island cabotage
Date: 1997-06-17
Institutions: European Commission
Subjects: domestic market, freedom to provide services, maritime cabotage, maritime transport, market access

K*W«#}« 

à 

-tr 

COMMISSION  OF THE  EUROPEAN  COMMUNITIES 

Brussels,  17.06.1997 
COM(97)  296  final 

REPORT FROM THE COMMISSION  TO THE COUNCIL 

on  the 
implementation  of Council  Regulation 
3577/92 applying the principle of  freedom 
to provide services to maritime  cabotage 
(1995-1996)  and  on the economic  and 
social impact  of the liberalisation  of 
island  cabotage. 

1. INTRODUCTION 

2.  DEVELOPMENTS  IN  THE  CABOTAGE  SECTOR  IN  THE  EUROPEAN 

UNION (1995-1996) 

2.1 Legislative developments 

2.2 Cabotage volumes (EU15 + other EEA) 

2.2.1  Liberalised  and  protected  cabotage  services  by  31  December 

1996: 

2.2.2  Cargo trades (EU-15) 

2.2.3  Cargo trades in other EEA countries 

2.2.4 Passenger trades (EU15 +other EEA) 

2.3  Cabotage cargo volumes in South European Member States 

2.3.1 Liberalised  (by 31.12.1996) 

2.3.2 Non liberalised  (by 31.12.1996) 

2.3.3  Involvement of foreign flags in liberalised cabotage trades 

2.3.4 Foreign flag involvement in non-liberalised  cabotage trades 

2.4 Foreign flags in cabotage trades of Northern Europe 

2.4.1 North European Member States - CARGO 

2.4.2 Northern European Member States - PASSENGERS 

2.4.3  Iceland  and Norway 

2.5 Cabotage 

2.6 Conclusions 

fleets 

3. THE PARTICIPATION  OF DIS AND MAR REGISTERED VESSELS IN EU 
CABOTAGE  AND  THE  QUESTION  OF  THE  EXTENSION  OF 
REGULATION  3577/92 TO THE EEA 

3.1  Introduction 

3.2 Fleet developments 

3.2.1  DIS and MAR fleets 

3.2.2  The fleets  of Iceland and Norway 

3.3  Cabotage involvement 

2 

4 

4 

4 

6 

6 

6 

7 

7 

8 

8 

8 

9 

10 

11 

11 

11 

11 

12 

12 

13 

13 

13 

13 

14 

14 

3.3.1  Participation  ofDIS  and MAR vessels 

3.3.2  Participation  of Icelandic and Norwegian vessels in cabotage 

3.4  Conclusions 

4. CREW COST COMPARISONS 

4.1  Calculations (input and outcome) 

4.2 Conclusions 

5.  LIBERALISATION  OF  ISLAND  CABOTAGE  AND  ITS  ANTICIPATED 

SOCIO-ECONOMIC  IMPACT 

5.1 Legislative provisions 

5.2  Cabotage related  employment in South European Member States.. 

5.3 The socio-economic impact of cabotage liberalisation until now 

5.3.1  Southern Member  States 

5.3.2 Northern Member  States 

5.4 Extrapolation  of trends observed 

5.5  Conclusions 

ANNEXES... 

ANNEX  1 

ANNEX II 

ANNEX III 

ANNEX IV 

ANNEX V 

14 

15 

15 

17 

17 

18 

20 

20 

20 

22 

22 

23 

24 

25 

27 

28 

35 

...38 

39 

40 

1. 

INTRODUCTION 

1.  This is the  second  report  on  the  implementation  of  Council  Regulation  (EEC) 
N° 3577/92 of 7 December  1992, which entered  into  force  on  1 January  1993. 
The first  report,  covering the period  1993-1994, was presented  on 6  September 
1995.  The  Regulation  provides  that  every  two  years  the  Commission  shall 
present  to  the  Council  a  report  on  the  implementation  of  the  Regulation  and, 
secondly,  that  the  Commission  shall  make  an  in  depth  examination  of  the 
economic and social impact of the liberalisation  of island cabotage and  submit  a 
report  to  the  Council  by  the  end  of  1996.  The  present  report  deals  with  both 
aspects. 

2.  The present report analyses the following  main issues: 

Chapter  2  :  the  effects  of  the  implementation  of  Regulation  3577/92  for  the 
period  1995-1996  during  which  one  more  cabotage  sector,  namely  mainland 
cruise services was liberalised. This part analyses economic developments  in the 
cabotage sector with reference to the period covered by the previous  report. 

Chapter  3  : the  participation  of  DIS1  and  MAR2  vessels  in  maritime  cabotage 
trades  of  EU  Member  States  and  the  question  of  the  extension  of  Regulation 
3577/92 to the EEA. 

Chapter  4  : manning  cost  comparisons  of the  different  EU  and  EFTA  registers 
participating in EU cabotage. 

Chapter  5  :  the  economic  and  social  impact  of  the  liberalisation  of  island 
cabotage. In order to assess the above, an attempt has been made to  extrapolate 
from  the  situation  in the Northern  Member  States  and  in the  liberalised  sectors 
of the Sourthern Member  States and to assess the cabotage related  employment 
in  the  different  Member  States  and  in  the  island  regions  in  particular.  This 
Chapter presents in its conclusions a policy option that the Commission  believes 
could  be appropriate on crew nationality requirements for  certain  sectors  of the 
cabotage market (see Article 3 of Regulation 3577/92). 

3. 

This  report  is  presented  for  information  to  the  European  Parliament,  the 
Economic and  Social Committee and the Committee of the Regions. 

2. 

DEVELOPMENTS  IN  THE  CABOTAGE  SECTOR  IN  THE  EUROPEAN  UNION  (1995-
1996) 

2.1 

Legislative  developments 

In  most  Member  States  there  have  been  no  legislative  developments  since  1994 
either  because  the  Regulation  had  already  been  fully  implemented  by  national 

1  DIS : Danish International Ship Register 

2  MAR : Madeira International Ship Register 

legislation  before  (Germany,  Portugal,  Spain)  or  because  no  specific  legislation  is 
needed  due to the lack of relevance of cabotage (Belgium, Luxemburg),  or  because 
Member  States  follow  traditionally  an  open  coast-line  policy  (United  Kingdom, 
Ireland,  Denmark,  Netherlands).  The  Commission 
infringement 
procedures  against  those  Member  States with  conflicting  national  legislation  (Italy, 
Greece, France). 

initiated 

Denmark  adopted  Law  464  of  12  June  1996  amending  the  law  on  the  DIS 
International  Register  in order  to  allow DIS  cargo vessels  (not  passenger)  access  to 
Danish cabotage trades. It entered into force by order of  1  December  1996. 

Portugal  adopted  an amendment  allowing MAR vessels to participate  in  Portuguese 
mainland  cabotage which entered  into force as from  1  January  1997. 

Spain  adopted  Law  42/1994  increasing  the fiscal  allowances  for  ships  registered  in 
the  Special Canary Islands Register (REC) to  70% of the employers'  Social  Security 
contribution,  25%  of  the  seafarers'  income  tax  and  35%  of  corporate  taxation3. 
Royal  Decree  392/1996 of  1 March  1996 allowed  ships used  in mainland  and  island 
cabotage of strategic products to be registered in the REC. 

As far  as the new Member States are concerned : 

- 

the  Austrian  legislation  does  not  mention  cabotage  since  maritime  cabotage  is 
geographically impossible in the case of Austria ; 

-  until  recently  Finland  operated  a  restrictive  cabotage  regime,  only  allowing 
national  flag  vessels  to  participate.  Since  its  entry  into  the  EU  the  law  has  been 
adjusted  in accordance  with  Regulation  3577/92  by  an  amending  act  1362/94  of 
22 December  1994 to the Restrictive  Trade Practices  Act.  This act  has  abolished 
restrictions concerning participation of EU vessels in Finnish cabotage trades. 

- 

the  cabotage  trade  in  Sweden  was  reserved  for  Swedish  vessels.  However, 
through  bilateral  agreements Norwegian  and  some EU  vessels  could  gain  access. 
Following  the  entry  into  the  EU  the  law  was  amended  in  accordance  with 
Regulation  3577/92  by  Decree  of  1 July  1995  amending  Decree  235/1974  on 
authorisation  to  carry  out  domestic  maritime  transport  operations  using  foreign 
vessels,  in  the  sense  of  allowing  access  to  EU  vessels  as  provided  for  by 
Regulation 3577/92. 

For the remaining EEA countries: 

-  cabotage legislation does not exist in Iceland, all vessels have free  access ; 

-  Norway  operates an open coastline policy, but NIS4 vessels may not  participate in 
cabotage,  while  vessels  involved  in  regular  passenger  services  require  a  special 
license. 

It is understood that these percentages were raised again by Law  13/96 of 30 December  1996. This 
latter modification, entering into force on 1.1.1997, falls outside the scope of this report. 

NIS : Norwegian International Ship Register 

Annex  I  presents  an  overview  of  the  cabotage  legislation  in  the  above  mentioned 
States  as regards  : waiver  systems,  crew  nationality  requirements,  vessel  ownership 
requirements and fiscal regimes. 

2.2 

Cabotage volumes (EU15 + other EEA) 

2.2.1  Liberalised  and protected  cabotage services by 31 December  1996: 

In  the  Northern  Member  States  (SWE,  FIN,  DK,  UK,  IRL,  DE,  NL  and 
BEL) all maritime cabotage services are liberalised either because they have a 
traditionally  open  coast  policy  or  because  of  the  implementation  of 
Regulation 3577/92. 

In  the  Southern  Member  States  (FR,  SP,  POR,  IT  and  GR)  the  following 
cabotage services have been liberalised by 31 December 1996: 

-  domestic  mainland  transport  of  non-strategic  cargoes  carried  by  vessels 

larger than 650 GT, on 1  January 1993; and 

-  mainland cruise services, on 1  January 1995. 

The following services remained protected in the reference period  1995-96 : 

In mainland trades: 

- 

the  transport  of  strategic  commodities  (oil,  oil  products  and  drinking 
water), which is liberalised as from  1  January 1997. 

-  services  by vessels  smaller than 650  GT,  protected  until  1 January  1998 

and 

-  regular passenger and ferry services, protected until 1  January 1999. 

In island trades: 

- 

island  cabotage  in the  South  European  Member  States  (including  Ceuta 
and Melilla and the French overseas departments) will be liberalised on the 
1st of January 1999. 

-  Regular  passenger  and  ferry  services,  as  well  as  services  provided  by 
vessels  less than 650  GT in Greece  shall be exempted from liberalisation 
until  1  January 2004. 

2.2.2  Cargo trades (EU-15) 

The total volume of cabotage trades in the countries of the former EU-12 has 
been  estimated  at  239  mln tonnes  in  1995,  compared  to  226  mln tonnes  in 
1993.  This  was  5.8%  higher  than  the  level  of  1993.  In  the  new  Member 
States  19.5  mln tonnes  were  transported  in  1995,  nearly  10% more  than in 
1993  (17.8  mln tonnes); of this  Sweden generated  13.6  mln tonnes,  Finland 
5.9 mln tonnes. 

The  total  volume  of  cabotage  cargo  trades  in  the EU  in  1995  was  therefore 
259 mln tonnes. Of this 46% concerned 'mainland' trades, the other  part  being 
'island' trades. 

Two recent events have had a significant  effect  on the trade volumes: 

-  due  to  the  establishment  of  a pipeline between  Sicily  and  the  mainland  in 

1995, the Italian oil transport by coastal vessels is declining; 

-  an increase in the transport  of fresh  water was responsible  for  a  significant 

increase in the Spanish cabotage. 

Table  1 

Summary of cabotage cargo trade volumes in EU countries in 1993 and  1995 (mln tonnes) 

Area 

North Europe (Belgium, Denmark, Germany, Ireland, Luxembourg, the Netherlands, 
United Kingdom) 

South Europe (France, Greece, Italy, Portugal, Spain) 

Sub-total EU-12 

Sweden and Finland 

Total EU-15 

1993 

100 

126 

226 

(18) 

(244) 

1995 

106.5 

133.0 

239.5 

19.5 

259.0 

2.2.3  Cargo trades in other EEA  countries 

In  two  EEA  countries  -  Iceland  and  Norway  -  around  39  mln  tonnes  of 
cabotage  cargoes  were  transported  in  1995  ;  of  this  Iceland  accounted  for 
only  0.4  mln  tonnes.  As  is  the  case  in  the  UK,  oil  transport  from  the 
continental shelf accounts for a large part of Norway's cabotage volume. 

Annex  II  contains  a  detailed  overview  of  cabotage  .developments  in  the 
Member  States and in Iceland  and Norway. 

2.2.4  Passenger trades (EU 15 + other EEA) 

The most important passenger trades are presented in table 2. 

Table 2 

Cabotage Passenger trades in EU and EEA countries, 1995 (million passengers) 

Country 
Liberalised 
Belgium 
Denmark 
Finland 
Germany 
Netherlands 
Sweden 
United Kingdom 

other  EEA 
Iceland 
Norway 

f  fowsaiigfere 

g B B f t S f f l B M » ^ ^ ^^ 

21.5 
4.0 
5.5 
3.3 
1.1 
40.6 

0.3 
47.2 

Protected 
Italy 
Portugal 
Spain 
France 
Greece  a) 

a) 

1994 figures. 

38.0 
0.4 
7.1 
1.3 

36 

In  nearly  all  cases  the  passenger  movements  relate  to  'island'  traffic.  The 
liberalisation  of mainland  cruise  passenger  traffic  on  1 January  1995  has  had 
no  impact  because  there  are  no  mainland  operations  of  cruise  vessels  taking 

place  in  South  Europe.  Domestic  cruise  passenger  traffic  only  occurs  within 
the Greek archipelago. 

2.3 

Cabotage cargo volumes  in South European  Member  States 

The  North  European  Member  States  have  already  fully  liberalised  their  trades.  The 
ongoing liberalisation will thus affect  cabotage trades of Southern European  Member 
States." Apart from the liberalisation of 3 mln tonnes of protected  mainland  cargoes in 
Spain in February  1994, following  the expiry of the  safeguard  measures under  Art.  5 
of the Regulation, no new cargoes were liberalised during the period  1995-1996. 

2.3.1  Liberalised (by 31.12.1996) 

The  cabotage  trades  in the  South European  Member  States  liberalised  in  the 
reference  period  involved  non-strategic  mainland  cargoes,  carried  by  vessels 
exceeding  650  GT.  This  segment  totalled  18  mln  tonnes  in  1995.  This 
represents  13,5%  of  the  total  cargo  volume  in  Southern  cabotage.  The 
following  table presents the updated  actual figures  for  1993 and  estimates  for 
1995. 

The  total  of  liberalised  trade  includes  an  approximate  3  to  4  mln  tonnes  of 
cargoes  that  are  transported  on  "own  account".  This  concerns  mainly 
transport  by  vessels  owned  by  cement  producers  in  Spain  and  Greece  and 
transport  of iron and steel products by the producers in Italy. 

Table 3 

Liberalised cargo trades by market segment and country,  1993 and  1995 (mln tonnes) 

category 

bulk cargo 

general cargo 

chem/gas 

Total 

France 

Greece 

Italy 

Portugal 

Spain 

Total 

1993 

1995 

1993 

1995 

1.1 

1.9 

5.1 

0.1 

3.7a) 

11.9 

1.3 

2.0 

5.6 

3.5 

12.4 

0.2 

2.1 

0.3 

2.6 

0.1 

2.8 

0.2 

3.1 

1993 

0.5 

0.6 

0.1 

0.8 

2,0 

1995 

1993 

1995 

0.6 

0.1 

0.8 

0.2 

0.8h) 

2.5 

1.6 

2.1 

7.8 

0.2 

4.8 

1.9 

2.2 

9.2 

0.2 

4.5 

16 5 

18.0 

a) 
the total refers to the volume that theoretically would have been effected  if the  liberalisation  had  already 
been  in effect  during  1993. Due to the  safeguard  measures  that  were  in  force  until  February  1994, the  cabotage 
volume that was liberalised in reality amounted to some 0.5/0.8 mln tonnes only. 

b) 

estimate. 

2.3.2  Non liberalised (by 31.12.1996) 

The  non-liberalised  cargoes  in  Southern  Europe  (i.e.  mainland  transport  of 
non-strategic  cargoes  by  vessels  <650  GT  and  all  strategic  and  island 
cargoes), amounted to  115 mln tonnes in  1995 divided as per Table 4 . 

Table 4  Non-liberalised trades in Southern Europe by market segment (mln tonnes) 

category 

carried by vessels < 650 GT 

strategic mainland trades (oil & water)* 

strategic island trades (oil & water) 

bulk cargoes - island 

general cargoes - islands 

Total non-liberalised trades 

revised actual  1993 

estimated  1995 

3.0 

28.1 

33.1 

23.4 

21.7 

109.3 

3.5 

26.5 

37.9 

22.5 

24.5 

114.9 

a) 

bulk liquids, excluding non strategic sections (chemicals, gases, edible oils, etc.). 

2.3.3 

Involvement of foreign flags  in liberalised cabotage  trades 

Cargo trades - general 

Of the  18 mln tonnes  of liberalised  Southern  European  trades,  3  mln  tonnes 
or  17%  was  carried  by  non-national  vessels,  from  other  EU  or  non-EU 
registers.  Compared  to the  corresponding  figure  for  1993  (12%),  this  points 
at  a growing  market  share for  non-national  flags.  However,  compared  to  the 
total  amount  of  maritime  cabotage  trade  in  Southern  European  Member 
States  (133  mln  t.),  the  market  share  of  non-national  flags  remained  small 
with 2.3% (compared to  1.6%  in 1993). 

A further  breakdown of the volume of 3 mln tonnes carried by foreign  flags  is 
presented  in table 5. 

Table 5 

Flag involvement in liberalised South European cargo trades (1995 - mln tonnes) 

Country 

Total Cabotage Trade 

EU flag 

non EU flag 

total foreign  flag 

France 

Greece 

Italy 

Portugal 

Spain 

Total 

involvement 

involvement 

involvement 

8.9 

18.4 

58.9 

6.0 

40.5 

0.210 

0.005 

0.095 

nil 

1.420 

0.430 

nil 

0.170(a) 

nil 

0.720 

0.640 

0.005 

0.265 

nil 

2.090 

132.7 

1.730 

1.320 

3.050 

(a) 

the division between liberalised and non-liberalised  is unknown. It is assumed that most of the transport under foreign flag relates to 
liberalised trades. 

It  appears  that  only  1.73  mln  tonnes  were  carried  by  EU  vessels  on  the 
basis  of  Regulation  3577/92,  whilst  1.32  mln  tonnes  were  carried 
through  waivers  by  non-EU  vessels.  Hence,  it  has  to  be  concluded  that 
the  impact  of  the  liberalisation  under  Regulation  3577/92  during  the 
period  of  review  has  been  very  modest  :  only  10%  of  the  liberalised 
cargo  volume  (18  mln  t.),  or  1,3%  of  the  relevant  market  (1.73  mln 

tonnes  on  a  total  of  133  mln  tonnes)  was  actually  carried  by  ships 
registered  in other Member States. 

A comparison by Member  State between  1993 and  1995 shows no  significant 
changes,-because national  market  shares remained  close to  100%,  except  for 
Spain.  In  1995,  82%  of  the  mainland  trade  was  carried  by  Spanish  flag 
vessels,  compared  to  89% in  1993. However,  the difference  is mainly  caused 
by reflagging  of Spanish owned  cabotage vessels to the Madeira register.  The 
flagshares  in mainland  cabotage  are  now  as follows  : Spanish  =  82%,  MAR 
= 7.5%, EU flags = 3.5%, non-EU flags through waivers = 7%. 

2.3.4  Foreign flag  involvement in non-liberalised  cabotage  trades 

The non liberalised  cargoes  (114.9 mln tonnes in  1995) were  in principle still 
exclusively  reserved  for  the  national  flags.  However,  in  1995  an  estimated 
6.6  mln  tonnes  (6%)  of  these  protected  cargoes  were  transported  by  non-
national vessels through waivers in cases where national flag  vessels were not 
available. Waivers were predominantly  issued  by three  countries:  France  (0.6 
mln  tonnes),  Spain  (1.3  mln  tonnes)  and  Portugal  (4.7  mln  tonnes). 
Compared  to  1993, the volume  of traffic  carried  under  waivers  increased  by 
10%. 

Table 6 

Flag involvement in non liberalised  South European trades (1995,  mln tonnes) 

country 

France 

Greece 

Italy (a) 

Portugal 

Spain 

total 

(a) 

see footnote table 5. 

EU flag 
(incl.  second registers) 
involvement 

0,370 

nil 

nil 

4,700 

600 

5,670 

non EU flag 

total foreign flag 

involvement 

0,260 

involvement 

0,630 

nil 

nil 

nil 

0,700 

0,960 

nil 

nil 

4,700 

1,300 

6,630 

Compared  to the previous report, the utilisation  of waivers went up in France 
and  Spain,  although  the  total  volume  remained  modest.  In  Greece  and  Italy, 
waivers are rarely granted  ; volumes remained  negligible. 

As  set  out  in  the  previous  report,  all  cabotage  transport  of  oil  products  in 
Portugal  (4,7  mln  tonnes)  is  carried  out  by  Portuguese  owned  vessels 
operating under the Madeira register through waivers. 

N.B. 

As announced  in the previous  report,  the  Commission  has  examined  whether 
the derogations  accorded  by Article 6 of Regulation  3577/92  remain  justified 
considering  that  Member  States'  provisions  on  waivers  for  access  to  non-
liberalised  trades do not include a preference  system  in favour  of EU flags  (of 
all  Member  States  only  Germany  applies  the  principle  of  Community 
preference,  see  Law  on  Coastal  Navigation  of  26  July  1957  modified  on  15 

10 

July  1994).  However,  taking  into  account  that  the  volumes  carried  under 
waivers  are  limited,  whilst  a  substantial  proportion  of the  carriers  concerned 
have an economic link with the Community,  there appears to  be no  economic 
necessity for  a specific initiative in this field  at present. 

2.4 

Foreign flags  in cabotage trades of Northern  Europe 

2.4.1  North European Member States - CARGO 

The cabotage in all North European Member  States  is fully  open  to  all  other 
EU flag  vessels. In some Member  States non-EU  vessels require  waivers  (D, 
SW,  FIN),  unless  they  have  been  granted  access  on  the  basis  of  bilateral 
agreements.  In  the  other  Northern  Member  States  third  country  vessels  can 
participate  on  the  same  basis  as  EU  vessels.  The  degree  of  foreign 
participation differs  considerably from  country to country. 

For Denmark  and  Sweden statistical data  are not  available, while for  Austria, 
Luxembourg, Belgium and the Netherlands this issue has no  relevance,  cargo 
cabotage being  marginal  or non-existant.  The  situation  in the  other  countries 
is illustrated  in table 7. 

Table 7 

Flag division in the cabotage trades in North European Member states ( 1995) 

Country 

Finland 

Germany 

Ireland 

United Kingdom 

a) 

estimate. 

total volume (mln tonnes) 

national share (%) 

EU flag share (%) 

non EU flag share  (%) 

5.9 

7.6 

0.7 

77.5 

88 

67 

4 

40 

12 

15 

15 

nil 

18 

16«> 

45 

Z. 4.2  Northern European Member States -  PASSENGERS 

The quasi totality  of passenger  cabotage  in Northern  Member  States is island 
cabotage.  According  to  the  information  available  within  the  Commission 
services,  100% of these operations is carried out by vessels flying the national 
flag. 

2.4.3 

Iceland and Norway 

There  is  no  foreign  participation  in  Iceland.  The  Norwegian  flag  accounts 
for  83% of Norwegian  cabotage.  It  is not  known  how  the  remaining  17% is 
divided  between  EU  and  non-EU  registered  ships.  For  passenger  traffic,  the 
same  applies  as  for  the  Northern  European  Member  States  :  100%  national 
flag. 

11 

2.5 

Cabotage  fleets 

Annex  III  contains  data  relating  to  the  cabotage  or  "coastal"  fleets  of  the  Member 
States.  Comparative  data  are  provided  for  1994  and  1996.  Ships  registered  in DIS, 
MAR,  Norway  or Iceland  are not  included  ; they are referred  to in Chapter  3 of this 
report. 

In  the  Southern  Member  States,  dedicated  cabotage  fleets  can  be  identified  on  the 
basis  of  specific  licences,  etc.  However,  in  the  Northern  Member  States  this  is  not 
possible,  as explained  in the previous report.  Therefore  the "coastal"  fleet  consisting 
of vessels below 6,000 GT (10,000 DWT) has been chosen as the yardstick. 

Between  1.7.1994  and  1.7.1996  the  coastal  fleet  of  the  Northern  Member  States 
(except  Austria, Finland  and  Sweden)  decreased  by  14% from  1,490  to  1,200  ships, 
but increased  slightly in capacity measured  in GT (+3%). 

In  the  Southern  Member  States  the  number  of  vessels  did  not  change  significantly 
(1191  units  in  1996)  but  the  capacity  in  GT  increased  by  44%  due  to  the  bringing 
into  service  of  new  big  ferries  in  Greece,  Italy  and  Spain.  The  small  Portuguese 
cabotage fleet declined further  due to continued reflagging  to Madeira. 

2.6 

Conclusions 

In  the  reference  period  1995-1996,  not  many  changes  took  place  compared  to  the 
situation described in the first cabotage report. 

The  liberalised  segment  of  the  market  in  Southern  Europe  remained  restricted  to 
mainland  cargo  cabotage with vessels over 650  GT,  which  represents  18 mln  tonnes 
of a total Southern cabotage market  of 133 mln tonnes. 

The  only new market  segment  being liberalised  in the  reference  period  concerns  the 
so-called  mainland  cruises.  However,  this  is  a  theoretical  step  without  practical 
consequences  since  all  cruise  programmes  include  at  least  one  island  destination. 
Island  cabotage  and  mainland  passenger  operations  will  not  be  liberalised  until  1 
January  19995. 

The  participation  of  non-national  EU  carriers  in  the  liberalised  segment  of  the 
Southern  cabotage  market  remained  modest  : almost  10% of this market  segment  of 
18  mln  tonnes  was  carried  by  non-national  EU  vessels  on  the  basis  of  Regulation 
3577/92  in  1995.  Non-EU  carriage  through  waivers  was  more  substantial  : 7.9  mln 
tonnes, of which  1.3  mln tonnes in the liberalised  market  segment  and  6.6  mln tonnes 
of non liberalised trades. 

The  outlook  for  the  next  period  1997-1998  is  that,  due  to  the  liberalisation  of 
strategic mainland trades (26.5 mln tonnes) as from  1.1.1997,  a more substantial  step 
will  be  made  on  the  way  towards  liberalisation  of  the  Community's  maritime 
cabotage market. 

Island  cabotage  in  Greece, as far  as regular  passenger  and  ferry  services  and  services  provided by 
vessels below 650 Gt are concerned, shall only be liberalised by 1.1.2004. 

12 

3. 

T HE  PARTICIPATION  OF  DIS  AND  MAR  REGISTERED  VESSELS  IN  EU  CABOTAGE 
AND THE QUESTION OF THE EXTENSION OF REGULATION 3577/92  TO THE  EEA. 

3.1 

Introduction 

The  two  questions  referred  to  above  were  discussed  in  the  Council  of  December 
1995,  following  the presentation  of the first cabotage report.  On both  issues,  several 
delegations  expressed  concern  that  vessels  registered  in  DIS,  MAR,  Norway  or 
Iceland  may  have  considerable  cost  advantages  over  the  vessels  of  other  national 
registers  of EU Member  States and therefore  were reluctant to grant  cabotage  rights 
to  these  vessels  in  the  same  manner  as  to  other  EU  vessels.  Decisions  were 
postponed  until after  the presentation of the second cabotage report. 

In  this  chapter  the  two  questions  are  examined  in  more  detail  by  analysing  in 
particular  :  the  evolution  of  the  relevant  fleets  since  1994  and  the  cabotage 
involvement  at  present.  The  comparative  crew  costs  for  all  relevant  registers  are 
examined in Chapter 4. 

The  temporary  derogation  provided  for  in  Article  1.2  of  Regulation  3577/92 
suspending  the  application  of the  provision  of  Article  1.1 requiring  that  ships  fulfill 
all conditions  for  carrying  out  cabotage  in the Member  State of registration,  expired 
on  31  December  1996. The  derogation  applied  to  the vessels  of the  DIS  and  MAR 
registers. In anticipation  of the  expiry, the Danish  authorities  have lifted6  the ban  on 
the  participation  of DIS  cargo  vessels  in Danish  cabotage.  The  Portuguese  law  has 
also  been  amended  to  allow  MAR  registered  vessels  to  participate  in  Portuguese 
mainland  cabotage  as from  1 January  1997. This means that  DIS  cargo7  vessels  can 
continue to participate without restrictions in EU cabotage, whilst MAR vessels have 
access to mainland  cabotage. 

Vessels registered  in Norway  or Iceland will have no access to EU  cabotage  as long 
as  no  decision  is made  on  the  extension  of the  cabotage  Regulation  to  the  EEA.  In 
addition,  it  should  be  noted  that  NIS  vessels  are  not  allowed  to  participate  in 
Norwegian  national  cabotage.  Therefore,  even if Regulation  3577/92  were  extended 
to  the  EEA,  NIS  vessels  would  still  have  no  cabotage  rights.  On  various  occasions 
the  Norwegian  authorities  have  stated  that  it  is  not  their  intention  to  modify  the 
present  NIS  legislation in the near future.  In this case, Icelandic and  NOR  registered 
vessels would  gain  access to  provide maritime  cabotage  services.  The NOR  register 
is situated among the more expensive registers compared to EU standards,. 

3.2 

Fleet  developments 

3.2.1  DIS and MAR  fleets 

Annex  IV  describes  the  composition  of  the  DIS  and  MAR  fleets.  The  main 
developments are the following : 

6  Law 464 of  12 June  1996 which entered  into force on  1 December  by order  1003  of 29 November 

1996. 

7  The situation for vessels carrying passengers has not been changed.  Vessels carrying both cargo and 

passengers, such as Ro-Ro ferries, are considered as passenger vessels. 

13 

The number of ships registered  in DIS showed  a slight decrease from  1994 to 
1996  (from  478  to  448  ships  ; -6%). However,  total  tonnage  went  up  from 
6.7  to  7.6  mln tonnes DWT  (+13%)  due to  an  increase  in  the  tanker  sector. 
The tonnage  of other  ship types remained  more  or less unchanged.  The  fleet 
is relatively young  : 70% of the vessels is under  10 years. 

The MAR fleet  is still relatively small, although the number  of ships increased 
from  35  in  1994 to  59 in  1996. However,  DWT  capacity  decreased  by 27% 
(from  1.46  mln  DWT  to  1.07  mln  DWT)  due  to  the  fact  that  a  number  of 
large  tankers  flagged  out.  Of the  59  ships  19 are  Portuguese  owned  and  34 
are Spanish owned (compared to 9 in 1994). 

3.2.2  The fleets  of Iceland and Norway 

The  Icelandic  fleet,  comprising  17  vessels  is  largely  involved  in  domestic 
trades, only a few vessels operate internationally. There were no fleet  changes 
between  1994 and  1996. 

The National Norwegian  Register  (NOR) covers 772 vessels  of mainly small 
size, but  also some 60 larger tankers for the offshore  oil trades. Most  vessels 
operate  nationally.  The average ship size stands at 2,700  GT  only.  Since mid 
1994 this fleet  has hardly changed. 

The NIS  fleet  has  an  entirely  different  structure  and  consists  mainly  of  large 
bulk  vessels  ; 287  tankers,  116 bulk  carriers  and  155  general  cargo  vessels. 
The  average  ship  size  here  is  28,000  GT.  Since  1994,  about  80  vessels 
(mainly bulk)  left  the register.  Other  ship types include  container  vessels  (6), 
reefers  (13),  ro-ro  cargo  (72),  ro-ro  passenger  ferries  (5)  and  passenger 
vessels  (16).  The  total  number  of  vessels  at  1.1.1996  was  670  with 
18,799,000 GT. 

3.3 

Cabotage  involvement 

3.3.1  Participation  of DIS and MAR  vessels 

In the previous report  it was estimated  that  of the total DIS  fleet,  at most  50 
units  were  employed  regularly  in  EU  cabotage  outside  Denmark,  mainly  in 
Germany  and the U.K.  It* was further  estimated  that  1 to  2%  of the  turnover 
of the  DIS  fleet  was  earned  from  cabotage  activities,  while  only  one  quarter 
of  this  percentage  stemmed  from  activities  in  Southern  Europe,  such  as 
incidental transport  of chemicals, gases and container feeder  services. 

14 

The pattern  found  in  1996 is basically the same  as descr  .. ed  abo  e,  although 
DIS  involvement  showed  an  increase  in  Spain,  where  participation  in  the 
mainland  container  feeder  trade went  up  from  0.094  mln  tonnes  in  1994  to 
0.175  mln  tonnes  in  1996.  The  increase  is  due  to  the  replacement  of 
previously  chartered  non-EU  tonnage  by  DIS  vessels  operating  mainly  in 
"international"  feeder  trades  carrying  cargoes  on  domestic  routes  on  a 
through bill of lading. 

MAR  vessels  participate  in  Portuguese  cabotage  (4.7  mln  tonnes  of  oil 
products through waivers) and  Spanish cabotage (1.6 mln tonnes). The MAR 
vessels operating in Spain are Spanish owned  and have recently  been  flagged 
out  from  the  Spanish register (see chapter 2, paragraph  2.3.3).  In the  case  of 
Portugal, the MAR vessels are all Portuguese  owned  and  employ  Portuguese 
crew. There are no reports of significant  MAR involvement  in other  cabotage 
trades. 

3.3.2  Participation  of Icelandic and Norwegian vessels in  cabotage 

Although  precise  figures  are  not  available,  it  is  commonly  known  that  NIS 
vessels  are  strongly  represented  in  the  British  mainland  oil  trades  and  in 
shuttling  oil  cargoes  from  the  British  offshore  fields  to  the  mainland. 
According to the reports received  by the  Commission,  Norwegian  vessels  do 
not  play  an  important  role in  any  of the  other  cabotage  markets  of  Member 
States.  It  is  reported  that  Norwegian  vessels  carried  0,5%  of  total  Spanish 
cabotage volumes in  1995 (compared  to 0,6% in  1994 and  0,4%  in  1993) on 
the  basis  of waivers.  In  addition,  the French  authorities  granted  5 single  trip 
waivers to NIS vessels in 1995 for the carriage of liquid gases  and  chemicals. 
No  other  reports  of  Norwegian  cabotage  involvement  have  been  received, 
neither were any Icelandic vessels identified  in EU cabotage. 

3.4 

Conclusions 

-a- 

In  the  reference  period  1995-1996  DIS  and  MAR  vessels  had  the  same 
cabotage  rights  as  other  EU  vessels  on  the  basis  of  Art.  1.2  of  Regulation 
3577/92, which  provision  expired  on 31.12.1996.  Following  the  amendments 
of  relevant  Danish  and  Portuguese  laws,  DIS  cargo  vessels  will  continue  to 
have such rights, whilst MAR vessels have access to mainland  cabotage. 

As NIS  and  Icelandic vessels were  not  covered  by Regulation  3577/92  in  the 
reference  period, participation in cabotage was only possible through waivers. 

-b- 

From  the  data  presented  in paragraph  3.3,  it follows  that  the  participation  of 
DIS,  Norwegian  and  Icelandic  vessels  in  EU  cabotage  in  Southern  Member 
States has been marginal until now. 

The  case  of  MAR  is  different  in  the  sense  that  a  number  of  traditional 
cabotage operators established  in Portugal and  Spain have reflagged  vessels to 
MAR  in  an  attempt  to  reduce  their  operating  costs,  while  their  vessels 
continue to operate in their traditional markets. 

-c- 

Already  in  1994,  the  Commission  proposed  to  the  Council  the  extension  of 
Council  Regulation  (EEC)  N°  3577/92  applying  the  principle  of  freedom  to 

15 

provide  services  to  maritime  transport  within  Member  States  as  part  of  the 
"interim  package".  In  1995, when  the  first  cabotage  report  was  presented  to 
the Council, the Commission  expressed  the view that  Regulation  3577/92 had 
to  be  extended  to  the  EEA.  Consequently,  in  1996,  the  Commission 
transmitted  a  proposal  to  the  Council  to  extend  Regulation  3577/92  to  the 
EEA.  The  European  Parliament  endorsed  this  position.  Furthermore,  the 
observed  market  developments  since  then  have  given  no  reason  for  concern 
on  economic  grounds.  Therefore,  the  Commission  confirms  its  position 
regarding  the  EEA  relevance  of  Regulation  3577/92  and  the  resulting 
obligation of the Community to grant the right to carry out  maritime  cabotage 
to the EFTA/EEA States. 

16 

CREW COST COMPARISONS 

4.1 

Calculations (input and  outcome) 

Crew costs are an important  element in the competition  between  carriers  operating 
under different  flags (although there are many other factors  involved,  see paragraph 
4.2).  Therefore,  the Commission  has asked  a specialised  consultant  to  estimate  the 
comparative crew costs for three shiptypes which are considered  to be representative 
for  cabotage operations  : a  1500 GT / 3000 DWT and a 3300 GT /  6000 DWT dry 
bulk cargo vessels and a 9000 GT/15000 DWT product tanker. 

Manning  costs  are  predominantly  determined  by  the  following  factors  :  crew 
composition,  nationality  requirements  and  the  different  salary  levels  for  such 
seafarers  and,  thirdly,  specific  national  rules  regarding  income  tax  and  social 
contributions of seafarers. 

Generally,  there  is  a  difference  between  South  European  cabotage  manning 
requirements  and Northern European requirements in the sense that  (a) the number 
of  seafarers  on  board  is above  the  average  found  in the  North  and  (b)  nationality 
requirements  tend  to  be more  strict  (in  some cases  the  rules  require  100% EU  or 
national crew). On the other hand, the so-called  second  registers  (presented  in bold 
in table  12) hardly  impose  any nationality  requirements  : normally  only  the  captain 
has to be a national of the flag State. 

*o 

As  regards  market  access  rights,  it  should  be  recalled  that  DIS-cargo  vessels  and 
ISR-vessels (Germany) have the same cabotage rights as ships in first registers. MAR 
vessels had such rights until 31.12.1996 and since then they have access to mainland 
cabotage only. In Spain, REC vessels have free access to those market segments that 
have  been  liberalised8  under  Regulation  3577/92.  NIS  vessels  have  no  cabotage 
rishts. 
*&* 

The outcome of the crew cost calculations is presented in tables  5.1, 5.2 and  5.3 of 
Annex  5. A comprehensive  overview  of the results is summarized  in the  following 
table. The figures relate to the average crew number and nationality  situation as has 
been found  to be typical for the fleets of the different  countries. The estimate shown 
in this table  represents  the  net  manning costs to  the  shipowner,  i.e.  gross manning 
costs  minus  tax  benefits  or  other  labour  related  State  aids  which  applied  in  the 
various countries in January 1996. 

REC  vessels  also  have  access  to  strategic  cargo  in  island  cabotage  in  Spain,  provided  that  until 
1.1.1999,  100% of  the  crew  consists  of  EU  nationals  and  that  the  captain  and  his  first  officer  are 
Spanish  nationals. 

17 

Tabic  12  Comparative crew costs by shiptypc and register (average liU =  100) I)) - Situation January  !996. 

general cargo 

general cargo 

Product tanker 

1,500 GT 

3,300  GT 

9,000  GT 

DIS minimum  (Denmark)  c) 

Madeira  (Portugal) 

NIS (Norway) 
Netherlands 

ISU  (Germany) 
Portugal  a) 
REC (Spain) a) 
Italy 
Iceland 
DIS - Danish crew (Denmark)  c) 
Germany 
United  Kingdom 
Greece a) 
Ireland 
Denmark 

Spain  a) 
Norway 

Finland 

TAAF  (France) 

Luxembourg 

Sweden 
Belgium 
France 

35 

45 
53 
55 

56 
74 
77 
78 
n.a. 
83 
86 
92 
92 
95 
105 
107 
107 
114 

133 

140 
158 
180 
236 

50 

40 

45 
46 
65 
72 
76 
78 
80 
115 
78 
89 
97 
93 
147 

105 
107 
128 

129 
123 
141 
160 
236 

43 

50 
67 
56 
86 
79 

78 
107 
75 
107 
103 
78 
100 
80 
137 
100 
139 
no 
104 
115 
133 
150 
202 

a) 

Consultants' estimate based on shipowners data. 

b) 

Ranking according to estimated costs for a  1,500 GT vessel. 

c) 

"DIS  minimum"  stands  for  Danish  captain  and  entirely  foreign  crew  paid  on  the  basis  of  a  collective  bargaining  agreement 
concluded  with foreign  seaman's unions. "DIS-Danish crew" stands for  Danish captain  and either Danish  crew or mixed crew  paid 
according to Danish standards. 

Sources: Tecnecon/MERC/ISF. 

4.2 

Conclusions 

From the above table, the following  tentative conclusions  can be drawn for  cabotage 
cargo vessels : 

-  crew costs  are lowest  in the second  registers  : DIS-minimum, MAR  and NIS, but 

crew costs under the Dutch national register are in the same range ; 

-  crew  costs  under  ISR,  Portuguese  national  register  and  REC  are  also  clearly 

below average ; 

-  slightly below average are  : Italy,  Iceland, DIS-Danish,  Germany,  the UK,  Greece 

and  Ireland ; 

- 

the  other  registers  are  average  or  above,  among  which  the  registers  of  France, 
Belgium and  Sweden show the highest manning costs. 

These  tentative  conclusions  should  be  interpreted  with  great  caution  taking  into 
account  the following  considerations : 

18 

-a-  The  crew  costs  under  different  registers  are  strongly  influenced  by  specific 
fiscal  arrangements which are changed by national authorities from  time to time. 
At  present,  the Commission  is examining  several  new labour  cost  related  State 
aid  schemes  for  1997  (France,  Sweden,  REC).  Germany  has  recently  revised 
the  support  measures  for  shipowners  and  temporarily  reduced  the  overall 
budget  for  this  programme.  Norway  has  also  modified  labour  cost  related 
arrangements  for  seafarers  : these  new  measures  are  currently  being  examined 
by the EFTA  Surveillance Authority. In some other Member  States,  discussions 
on  such  measures  are  underway  between  the  government  and  the  social 
partners.  Consequently,  the competitivity ranking of table  12 is likely to  change 
considerably in the near  future. 

To illustrate the point, the high ranking of the Dutch  register  in table  12 is  due 
to the fact  that  in January  1996 a new scheme came into force  by which  a  zero 
rate was  introduced  for  income tax and  social  contributions  of Dutch  seafarers 
on  board  Dutch  flag  vessels.  At  the  same  time,  investment  premiums  were 
abolished.  If,  for  1995  the  same  calculations  had  been  made,  then  the  crew 
costs ranking of this register would have been around EU average. 

-b-  Crew  costs  form  only  a  small  percentage  of the  total  costs  of  a  cargo  vessel9. 
Fixed  costs,  of which  capital  costs  are  the  main  component,  normally  account 
for  more  than  half  of  the  overall  costs.  The  other  so-called  operational  costs 
broadly  include  fuel,  expenditures  for  surveys,  repairs  and  maintenance  and 
manning  costs.  As  a  general  rule,  fuel  costs  account  for  45-50%  of  the 
operational costs, surveys, maintenance and repairs for  10 to  15%,  and  manning 
costs for the balance. 

Certain  of these cost components can be assumed to be the same in all Member 
States (e.g. fuel  is tax free in all M.S.), however,  other cost elements may  differ 
considerably. For  instance, capital  costs are influenced  by investment  premiums 
(granted  in  a  number  of  Member  States)  or  by  interest  Tate  subsidies,  or  by 
accelerated  depreciation  schemes or by other fiscal  facilities  concerning tax  free 
reserves, profit  and loss compensations, etc. 

In  conclusion,  table  12  should  not  be  understood  as  being  the  yardstick  for  the 
overall  competitive  position  of  different  registers.  It  merely  compares  the  manning 
costs  at January  1996, knowing  that  the picture  changes regularly  in function  of  the 
variables set out above. 

9  Passenger operations are more labour intensive, hence, crew costs play a greater role. 

19 

5. 

LIBERALISATION  OF  ISLAND  CABOTAGE  AND  ITS  ANTICIPATED  SOCIO-ECONOMIC 
IMPACT. 

5.1 

Legislative  provisions 

Article  6.2  of  Regulation  3577/92  provides  that  island  cabotage  in  the  Southern 
Member  States10  shall  be  temporarily  exempted  from  the  implementation  of  the 
Regulation  until  1 January  1999. Article  6.3  provides that  this  derogation  should  be 
extended  for  Greece  until  1  January  2004  for  regular  passenger  services,  ferry 
services and services provided by vessels less than 650 GT. 

On manning nationality requirements for vessels engaged in island cabotage (valid  for 
both  Southern  and Northern Europe),  Article 3.2  of the Regulation  provides that  all 
matters relating to manning shall be the responsibility  of the State in which the vessel 
is performing  a maritime transport  (host  State).  However,  Article  3.3  states  that,  as 
from  1.1.1999,  manning  of  cargo  vessels  over  650  GT  engaged  in  so-called 
consecutive island cabotage11 shall be governed by flag  State conditions. 

Article  3.4  further  provides  that  (a)  the  Commission  shall  make  an  in-depth 
examination of the economic and social impact of the liberalisation of island  cabotage 
and shall submit a report to the Council before  1  January  1997, and (b) that this latter 
report  should  serve  as  a basis  for  a  proposal  to  be  submitted  to  the  Council  which 
may  include  adjustments  to  the  manning  nationality  provisions  laid  down  in 
paragraphs  2  and  3  of  Article  3 and  that  the  definitive  system  shall  be  approved  by 
the Council before  1  January  1999. 

The  present  chapter  summarizes  the  findings  of  the  aforementioned  examination  of 
the  possible  socio-economic  impact  of  the  forthcoming  liberalisation  of  island 
cabotage.  A  proposal  on  manning  nationality  provisions  will  be  submitted  shortly 
after  the present report  has been discussed in the Council  framework. 

5.2 

Cabotage related employment  in South European  Member  States 

From the  study carried  out  on behalf of the Commission,  it appears  that  the issue  of 
liberalisation  of  island  cabotage  is  still  a very  sensitive  one  in  Southern  Europe.  In 
particular,  if it was  decided  to  modify  the  current  nationality  manning  requirements 
from  host  State  to  flag  State,  the  Unions  of  seafarers  fear  there  would  be  an 
important loss of local employment. It should also be stressed  that the unemployment 
rate  in  certain  island  regions  is  very  high  compared  to  the  national  average  of  the 
countries  concerned.  Hence,  it  would  be  very  difficult  for  any  seafarers  resident  in 
the islands made redundant to find  alternative  employment  there. For  example,  Sicily 
and  Sardinia  are  island  regions  with  an  unemployment  rate  substantially  above 
average.  However,  there  are  also  islands  with  a  relatively  low  unemployment  rate  : 

10 

11 

that means  : island cabotage in the Mediterranean  and with  regard to Canary,  Azores and  Madeira 
archipelagoes, Ceuta and Mellila, the French islands along the Atlantic coast and the French overseas 
departments (Guadeloupe, Martinique, Guyane, Reunion). 

that means  : the island cabotage voyage concerned follows  or precedes a voyage to or from  another 
State. 

20 

the  Balearics,  Crete  and  Madeira.  In  the  other  island  regions,  the  employment 
situation is not very different  from the mainland. 

The total number of jobs directly related to South European cabotage is summarized 
in the following table : 

Table of Estimated total number of jobs associated with South European cabotage activities (1995) 

category 

sea 

shore 

total 

island 

total 

island 

total 

trades 

3,350 

4,094 

14,430 

12.200 

18,450 

17.500 

523 

500 

1,747 

2,500 

2,050 

88 

France 

Greece 

Italy 

Portugal 

Spain 

Total 

6,300 

4,540 

1,240 

1,090 

7,540 

5,630 

43,797 

38.090 

7,625 

5,480 

51,422 

43,570 

Total 

island 

trades 

4,820 

trades 

1,457 

5,841 

900 

16,930 

13,100 

1,950 

20,500 

19,450 

7,780° 

70 

611 

570 

island 

residents 

1,820 

5,860 

128 

1,602 

17,190 

These figures  include all cabotage sectors  : cargo  (liquid  bulk,  dry bulk,  containers 
etc.), regular passenger/ferry  services and cruise activities. Cabin crew  and  catering 
personnel on board passenger vessels are counted as seafarers and are included in the 
above figures, which refer to all island regions as specified in footnote  10. 

From these figures,  it follows that island cabotage is indeed an important  source of 
employment in the regions concerned. With some 38.090 seafarers in island cabotage 
and some 5.480 directly related shore staff, the island sectors count for 43.570 jobs. 

12  Although  by  virtue  of  Art.  6  of  Regulation  3577/92  island  cabotage  with  the  French  DOM's  is 
temporarily exempted (until  1.1.1999) from its application, French national legislation only reserves 
to  the  French  flag  cabotage  trades  between  ports  of  one  and  the  same  overseas  department  and 
between ports in Guadeloupe, Guyane and Maritinique. As a result, cabotage related employment  is 
limited  to a  small  number  of  local  seafarers  (+/-  100) and  shore  staff  (+/-  20),  which  figures  are 
included here. 

21 

The  great  majority  (70%)  of  seafarers  jobs  in  island  traffic  is  found  in  the  labour 
intensive passenger trades (see below) : 

regular passenger/ferry  services : 

22.200 seaferers  =  58.4% 

island cruise services  : 

4.400 seafarers  =  11.6% 

}  70% 

island cargo trades  : 

11.400 seafarers  = 

30% 
__ 
total of 38.000 seafarers  =  100% 

+ 

+ 

5.3 

The socio-economic  impact of cabotage liberalisation  until  now 

5.3.1  Southern Member  States 

to  estimate  what  the  likely  socio-economic 

In  order 
impact  of  the 
forthcoming  liberalisation  of  island  cabotage  in  Southern  Europe  will  be,  it 
has been examined what conclusions can be drawn from : 

-a- 

-b- 

the partial liberalisation of mainland  cabotage in Southern  Europe  up 
to now and 

the  completed  liberalisation  of both  mainland  and  island  cabotage  in 
Northern Europe (see 5.3.2). 

As  regards  point  -a-,  the  analysis presented  in  chapter  2  has  shown  that  the 
impact  of  the  liberalisation  has  been  very  limited  : of  the  18  mln  tonnes  of 
cargo being liberalised under Regulation 3577/9^ only  1.73  mln tonnes  (10%) 
were  carried  by  ships  from  other  Member  States.  There  are  no  indications 
that  this  modest  participation  of  foreign  EU  carriers  has  had  a  significant 
impact on the position of seafarers in Southern Member States. 

Another  development,  with  perhaps  a greater  bearing  on the  position  of  EU 
seafarers,  was  the  participation  of  foreign  registered  vessels  (both  EU  and 
non-EU)  in non-liberalised  trades on the basis of waivers granted  by  national 
authorities for  a total volume of 6.6 mln tonnes. As stated  before,  it has been 
observed  that  national  carriers  tend  to  cut  costs  (notably  in  Portugal  and 
Spain)  by  reflagging  cabotage  vessels  to  a  second  register  and  to  use  these. 
same vessels  on the  basis  of waivers  in cabotage  trades. However,  the  trend 
to  cut  costs  by  re-flagging  is  a  general  one,  observed  in  all  sectors  of 
Community shipping, independent of the cabotage Regulation. 

If any conclusion can be drawn from the above situation, it appears to be that 
the  socio-economic  impact  of  the  cabotage  Regulation  is  less  pronounced 
than  initially  expected  or  feared  by  certain  parties.  However,  this  is  only  a 
preliminary  conclusion  since it should  be borne in mind that  the  liberalisation 
of  cabotage  in  Southern  Europe  has  only just  begun  :  18  mln  tonnes  have 
been  liberalised  out  of  a  total  cabotage  cargo  volume  of  133  mln  tonnes. 
More  significant  volumes  of  strategic  mainland  cabotage  are  now  being 

22 

liberalised as from  1 January  1997 whilst the liberalisation in passenger trades 
will not start until 1.1.1999. 

5.3.2  Northern Member States 

Some Northern Member  States  apply traditionally  an open  coast  line  policy 
(UK,  Ireland,  Denmark,  Netherlands,  Belgium).  Hence,  cabotage  has  been 
completely  free  and  open  to  worldwide  competition  for  many  decades.  In 
other  Member  States  cabotage  was  liberalised  with  the  entry  into  force  of 
Regulation  3577/92  (Germany)  or  at  the  moment  of  accession  to  the 
Community for Sweden and Finland respectively. 

The U.K.,  with a substantial cabotage market and a completely liberal policy, 
is an interesting case to see to what extent national carriers can be substituted 
by foreign carriers in the long run. It appears that the situation differs for the 
following  market segments :  liquid bulk, dry cargo and passenger services. In 
liquid bulk, UK registered ships hold a market share of only 30%; in dry bulk, 
the  share  is  around  50%,  whilst  passenger  cabotage  services  are  entirely 
carried out under the national  flag. 

The  UK  tanker  cabotage  market  is  a  special  case.  The  substantial  oil 
transport  from  the  continental  shelf  in  the  North  Sea  has  attracted 
international  tanker  operators  (NIS,  Finland,  others).  The  average  loading 
capacity  of tankers used  in this trade is  also  much higher than of  tankers in 
conventional cabotage trades. 

It  should  also  be  borne  in mind  that  in the  bulk  sector  and  in particular in 
Northern  Europe,  many  EU  established  shipowners  have  chosen  to  re-flag 
their vessels to non-EU registers (for fiscal  and other reasons falling  outside 
the scope of the cabotage Regulation). This may lead to a situation where the 
number of vessels required to serve the national cabotage market is no longer 
available under the national  flag. 

In  the  other  Northern  Member  States,  passenger  island  cabotage  is  100% 
carried  out  by  nationally  owned,  crewed  and  registered  vessels.  Cabotage 
passenger  trades  are  important  in  Denihark  and  to  a  lesser  extent  also  in 
Germany, Finland and the Netherlands (see table 2). 

As  regards  cargo  cabotage,  the  situation  varies  by  Member  State.  In 
Germany, national carriers operating under the national flag held in 1995 (see 
table 7)  67% of the market (liquid bulk and dry cargo  combined),  15% was 
carried  under  other  EU  flags  and  18%  by  third  country  registers  through 
waivers. 

For  Denmark  and  Sweden,  no  precise  figures  are  available,  but  experts 
suggest  that the global  patterns  should be  roughly  similar to  those  found  in 
the UK and Germany respectively. 

In Finland, national carriers have 88% of the market,  12% is carried by other 
EU  flags. 

23 

5.4 

Extrapolation  of trends observed 

To what extent can the experiences gained with free cabotage in Northern Europe be 
used to forecast future developments in Southern Europe? Obviously, the  differences 
between the relevant markets have to be taken into account. 

From the preceding section it appears that domestic regular passenger  services tend 
to remain in the hands of carriers established in the  State concerned,  operating ships 
registered  in that  State  and crewed  by nationals  of  that  State,  even  if the  market  is 
open  and free  for  many years.  The  most  likely  explanation  for  this  phenomenon  in 
Northern  Europe  is  that  it  is  not  financially  attractive  for  a newcomer  to  set  up  a 
regular  passenger  service  to  Nordic  islands in parallel  to  the  existing  service  of the 
traditional carrier. In the Northern Member States such services are normally carried 
out  on  a purely  commercial  basis,  which  implies  modest  profit  margins  in  an  open 
low-growth market. It is also worth noting that cabotage passenger operators hardly 
make use  of the possibilities  under the laws  of Northern Member  States  to  engage 
foreign  non-EU  staff  on board their  domestic  ferries.  Language  considerations  may 
partly explain this preference for national seamen. 

The market for regular passenger services to and from islands in Southern Europe is 
different  in the  sense  that  the  seasonal fluctuations in  demand  (summer  peak)  are 
much more pronounced. Island services can be very profitable in the summer. Hence, 
it is not to be excluded that newcomers would find it commercially  attractive to  set 
up  new  regular  passenger  services  in  parallel  to  those  offered  by  the  traditional 
carriers.  Although,  such  an  evolution  would  be  compatible  with  the  principle  of 
freedom  to  provide  services,  it  also  implies  that  the  issue  of  harmonisation  of 
competition conditions merits special attention. 

The  concern  of  seafarers  Unions  and  ferry  operators  in  Southern  Europe  with 
increased  competition  from outside  should be seen against the background  of  other 
fundamental  changes  taking  place  in  their  economic  environment,  such  as  moves 
towards  privatisation  of  presently  State-owned  ferry  companies  serving  island 
regions  in  Italy  and  Spain,  pressure  from  certain  governments  to  re-examine  the 
provisions on public service obligations in favour of a new approach based on public 
tender, the introduction of fast ferries,  etc. These  developments  should  in any event 
force  operators to  become  more market oriented  and competitive,  a process  which 
can already be observed. 

When  being  asked  to  express  their  views  on  the  forthcoming  liberalisation  of  the 
cabotage  market  and  the  possible  switch  from  host  State  to  flag  State  manning 
conditions,  it  became  clear  that  this  latter  point  is  the  main  source  of  concern 
amongst  South  European  seafarers,  in particular  in  relation  to  the  labour  intensive 
passenger  services.  It would  be  considered  unfair  if North  European  carriers  were 
allowed  to  set up regular passenger services in Southern Europe making partial use 
of  cheap  third  country  labour,  as  is  allowed  to  some .extent  under  their  flag  State 
manning provisions. 

As  regards  island  cargo  trades,  the  situation  is  less  sensitive.  First  of  all,  because 
crew costs play a lesser role in cargo trades and only 30% of all seamen employed in 
Southern  island  cabotage  work  in the  cargo  sector  (see  page  20).  Secondly,  some 
40% of these jobs  are found  on board very  small vessels with a loading  capacity  of 
less  than  650  GT,  which  hardly  exist  in  fleets  of  Northern  Member  States.  The 
24 

possible  application  of flag State  conditions  would  therefore  not  be  likely  to  have a 
significant  impact  on this sector. 

In  island  cargo  cabotage,  with  bigger  vessels,  Northern  carriers  could  offer 
competition.  However,  considering  that  Regulation  3577/92  provides  for  long 
transition  periods  allowing  the  parties  concerned  sufficient  time  to  prepare  for  the 
opening  of  the  market,  further  considering  that  there  is  no  legal  obligation  to  open 
the  cabotage  market  to  non-EU  carriers  (as  has  been  done  in  certain  Northern 
Member  States), and taking into account the experience gained with the  liberalisation 
of  mainland  cargo  cabotage,  there  is  no  reason  to  assume  unsustainable  socio 
economic consequences as a result of the liberalisation of island cargo  cabotage. 

5.5 

Conclusions 

The  host  State manning conditions as set out  in Article  3 of Regulation  3577/92  are 
to be regarded  as a temporary derogation to the normal flag State regime. 

As  regards  maritime  cabotage  cargo  services,  the  analysis  presented  in the  previous 
chapters of this report  has not revealed  compelling arguments to justify  a long lasting 
derogation  from  the  usual  flag  State  manning  conditions.  Cargo  cabotage  services 
are  often  carried  out  by  ships  which  participate  alternatively  in  international  and 
domestic traffic.  The manning  conditions  for  this type  of cabotage  can therefore  not 
deviate  substantially  from  the  accepted  practice  in  international 
trades.  The 
Commission  therefore  takes  the  view  that  as  of  a  certain  date  (to  be  decided)  flag 
State  manning  conditions  should  apply  to  the  entire  EU-market  for  maritime  cargo 
cabotage. 

As regards regular passenger/ferry  services in island cabotage, the special  character  of 
the  market  and  the  potential  socio-economic  implications  of  the  forthcoming 
liberalisation,  in  combination  with  the envisaged  switch from  host-State  to  flag-State 
manning  conditions,  would  justify  the  adoption  of  certain  special  provisions  to 
counteract  a  possible  disruption  of  the  competition  conditions.  The  Commission 
believes  that  this  objective  can  be  achieved  by  the introduction  of  a  regime  whereby 
flag  State  manning  conditions  shall  in  principle  apply  to  all  cabotage  passenger 
services  but  the  host  State  may  be  allowed  to  require  that,  in  the  case  of  regular 
passenger  cabotage  services,  its  rules  concerning  the  proportion  of  EU  nationals  in 
the  crew  shall  apply  (which  would  require  an  amendment  of  Article  3  of  Regulation 
3577/92). 

In  addition,  from  the  safety  aspect  it  should  be  recalled  that  Member  States  may 
require, in accordance with Council Directive 94/58/EC  of 22 November  1994 on the 
minimum  level  of  training  for  seafarers  (O.J.  N°  L  319  p.  28),  that  a  certain 
percentage  of the crew  members and  in particular  those  nominated  on  muster  lists  to 
assist  passengers  in  emergency  situations,  must  have  communication  skills  that  are 
sufficient  for  that  purpose  and which may consist,  inter, alia, in speaking  the  language 
or  languages  appropriate  to  the  principal  nationalities  of  passengers  carried  on  a 
particular  route. 

This  approach  will  allow  the  internal  market  to  work  on  the  basis  of  Community 
social standards wherever this is possible. 

25 

It  is  the  Commission's  intention  to  submit  to  the  Council  a  legislative  proposal 
amending  Article  3 of Regulation  3577/92  along the lines set out  above,  in the near 
future. 

26 

ANNEXES 

27 

Table A. 1 

Overview of cabotage provisions for EU Member States 

ANNEX  1 

Country 

Basic  principle  on 
cabotage 

Austria 

No maritime cabotage 

Belgium 

Not restricted 

Comment 

Waiver system 

Crew nationality requirements 

Vessel ownership  requirements 

Fiscal regime 

1st Register 

2nd Register 

1st Register 

2nd Register 

not applicable 

not applicable 

None,  negotiated  on 
ship by ship basis. 

not applicable 

should 

Captain 
be 
Belgian  citizen,  waivers 
given  in  case  of  non 
availability. 

not applicable 

Vessel  owned/managed 
by  EU  citizen/company 
domiciled in Austria 

owned 

by 
Vessel 
citizen/ 
Belgian/EU 
company  domiciled 
in 
Belgium/EU  or  non  EU 
national  represented  by 
Belgium/EU citizen with 
office  in/managed  from 
Belgium 

Vessel owned by  Danish 
or 
or  EU 
companies  and  managed 
from  Denmark. 

persons 

not applicable 

not applicable 

applicable 

None 
shipping 

for 

None  specifically 
seafarers 

for 

DIS  Register:  see  1st 
register 

Seafarers  on board  DIS 
vessels are tax exempted 
and paid net wages. 

Denmark 

Not restricted: 
Decree  658/94  allows 
all  foreign  vessels  to 
participate. 

Previous  restrictions  for 
DIS  cargo  vessels  have 
been  abolished  as  of  1 
December 1996. 

not applicable 

Captain 
Danish. 

must 

be 

DIS Register: 

• Captain  to  be  Danish 

national. 

• Third  country  natio 
nals  can  be  employed 
on 
wage 
conditions. 

local 

Source : Merc TecnEcon 

•2% 

Country 

Basic  principle  on 
cabotage 

Finland 

Restricted: 
Cabotage  governed  by 
Section  4  of  Restrictive 
Trades Practices Act. 
Foreign vessels generally 
prohibited  from  entering 
domestic coastal trades. 

France 

Restricted: 

des 

'Code 

Art.257 
Douanes'(11/5/77): 
only French  flag  vessels 
can  participate  between 
metropolitan ports. 
Art.258  extends  this  to 
voyages between ports in 
one  dom  and  ports  of 
Guadeloupe,  Guyane 
and Martinique. 

Source : Merc TecnEcon 

Comment 

Waiver system 

Crew nationality  requirements 

Vessel ownership requirements 

Fiscal regime 

1st Register 

2nd Register 

1st Register 

2nd Register 

amending 

Act 
issued  on 

An 
(1362/94) 
1.1.95: 
- abolished 

restrictions 
concerning  cabotage  for 
EU vessels. 

• Permits 

granted 

for 
maximum  of  1  year  to 
foreign  vessels  trading 
between  Aland 
and 
mainland. 

- 3  awarded  in  1993.  No 
in 

awarded 

permits 
1995/6. 
• Special 

foreign 

permits 

be 
obtained  from  MOTC 
for 
in 
mainland  cabotage  if no 
suitable  Finnish 
ship 
available. 

ships 

-  10  permits  given  in '95, 
5  in 96  (mainly Eastern 
Europe flags).  • 

Waivers  can  be  granted 
for single or consecutive 
to  non-EU 
voyage(s) 
vessels 
liberalised 
trades and EU-vessels in 
non-liberalised  trades  in 
case 
"identified 
of 
demand" (art 257). 

in 

- Registration governed by 
Marine  Registration  Act 
(512/1993). 

- List of Merchant  Vessels 
in  International  Trade 
(Act No.  1707/1991). 

- >60%  vessel  owned  by 
citizens/ 

Finnish 
companies. 

- Ownership  requirements 

same as 1st register. 

- Vessels must be less than 

Tax  rebates  and  partial 
refund  of  social  security 
costs  paid  by  the  owner 
are  available  for  ships 
listed 
the 
on 
International Register. 

20 years old. 

- Registration 

not 
permitted  for  passenger/ 
car  ferries  or  vessels 
engaged 
in 
cabotage. 

only 

TAAF  register:  similar 
as 1st register. 

to  allow 

- Amendment  to  Shipping 
Act (167/1939)  of  1.10-
foreign 
.94 
in 
ships 
Finnish 
if 
owned/  controlled  by 
Finnish 
or  EEA 
entities. 

registered 
register 

- 

- Vessel  must 

belong 
100% 
to  a  physical 
person  national  of  EU/ 
to  a 
EEA  or  50% 
company 
its 
registered  office  in  EU, 
and  its operation  carried 
out from France. 

having 

- partial 

refunding 
to 

corporate 
local authorities, 

tax  paid 

• partial  refunding  social 
for 
in 

security 
operations 
international trades. 

costs 

Finnish  citizens  retained 
labour 
on 
contracts. 

collective 

• Master  must  be  Finnish 

national. 

- May recruit foreign  crew 
members 
certain 
on 
conditions  by  way  of 
the 
derogation 
labour 
usual  collective 
agreements. 

from 

the 

- Half 

crew  may 
of  members 

consist 
domiciled in the EEA. 
- Finnish crews are largely 

used in practice. 

-  1st  Register:  master  and 
French 

first  mate 
citizens, 

- other crew citizens of the 

EU or EEA. 

Taaf 
(Kerguelen) 
Register:  -35%  of  crew 
should  .  be 
French 
nationals,  incl.  captain 
and  1st engineer. 

29 

Source : Merc TecnEcon 

Country 

Basic  principle  on 
cabotage 

Comment 

Waiver system 

Crew nationality  requirements 

Vessel ownership requirements 

Fiscal  regime 

1st Register 

2nd Register 

1st Register 

2nd Register 

Germany 

Restricted  to  EU  reg 
istered 
owned 
or 
vessels: 
Regulated in Art. 5: para 
2,  3  'Gesetz  ilber  die 
Kûstenschiffahrt' 
(Law 
on coastal shipping). 

Paragraph  2.1  sub  3 
(which came in effect  on 
23  July  1994)  brought 
Art  5.  in  line  with  CR 
3577/92. 

Para  2.2  &  3  of  Art.5 
define:  -conditions 
for 
granting  of  waivers  to 
non-EU flag vessels; 

- these  conditions  may  be 
waived 
of 
in 
reciprocity. 

case 

Greece 

Restricted: 
Regulated  in  legislative 
for 
decree 
passenger 
cargo 
transport. 
in  principle  only  Greek 
vessels are allowed 

187/73 
and 

Près.  Decree  215794 
partly harmonised  Greek 
law  in  accordance  with 
CR 3577/92: 

Waivers can be granted: 
- Art. 166 of Nautical  Law 
regulates 

187/73 
waivers. 

- allows 

involvement  of 
oth.  EU  vessels  in  non-
strategic 
by 
trades 
vessels >650 GT. 

- During  1995/6  only  4 
waivers  were  granted, 
for specialised vessels. 

Ireland 

Not  restricted 

not applicable 

- According to  the  para  1 
Schiffs-

of 
the 
besatzungsordnung: 
Master 
German national. 

should  be  a 

- Vessels  on 

Basically same, but: 
ISR 

list, 
(operating  >half  year 
international) 
may 
employ foreigners. 

- No further  stipulations. 

- Vessels  >half  year 

in 
cabotage  cannot  enter 
ISR  list  and  may  only 
employ 
if 
nationals not available. 

foreigners 

ISR same as  1st register. 

>50%  ownership/control 
by  German  or  EU 
nationals 
with 
representative  domiciled 
in  Germany.(Art.  1  and 
Flaggen-
2 
rechtsgesetz). 

of 

- ships operating  solely in 
cabotage:  no  tax  relief 
on 
and  no 
subsidies. 

income 

- profit 

ships 
from 
operating internationally 
taxed 
at  maximum 
28.2% instead of normal 
47%. 

Près.  Decree 
demands: 

12/92 

not applicable 

-  100% of crew consists of 
EU 

Greek/other 
nationals. 

Article  5 of Law  187/93 
states:  >50%  of  owner 
ship  by  Greek  nationals 
or legal entities. 

not applicable 

- Officers  pay  8% income 

tax, 

- Ratings 

totally 
are 
exempted  from  income 
tax. 

not applicable 

- Officers  to be Irish,  UK, 
other  EU  or  Common 
wealth citizens. 

- Ratings:  Irish,  UK,  or 

other EU citizens. 

Vessels  owned  by  Irish 
citizens/Corporate  body 
citizens/corporate 
or 
reciprocating 
body  of 
states 
by 
Government. 

recognised 

to 

More than  50% property 
Italian 
belonging 
citizens/compa-nies, 
as 
in  Art. 143 
regulated 
della 
Codice 
Navigazione. 

not applicable 

-  10%  Corporate  profit 

tax 
-  15% 

straight 

line 

depreciation 

- No 

standard 
seafarers. 

reduction 
tax 

on 
for 

not applicable 

• 8.86%  détaxation  of 
social  benefit  charges 
plus 

-Until 

30/11/1996: 
10.6%  allowance  on 
social benefit charges. 

Italy 

Restricted 
Regulated 
della 
Chapter 
Code). 

in:  'Codice 
Navigazione' 
(Shipping 

III 

in principle, restricted  to 
Italian vessels 

of  Merchant 
of 

Min. 
Marine  Circular 
1992: 

- allows  other  EU  vessels 
in  liberalised  cabotage 
sections. 

Waivers may be  granted 
on  case  by  case  basis 
special 
through 
authorization 
the 
Ministry. 

by 

• Master  and  chief  officer 

not applicable 

to be Italian, 

- other 

crew  members 
Italian  or  EU  citizens 
recognised 
(certificates 
by Italian law). 

30 

Country 

Basic  principle  on 
cabotage 

Comment 

Waiver system 

Crew nationality requirements 

Vessel ownership  requirements 

Fiscal regime 

1st Register 

2nd Register 

1st Register 

2nd Register 

Luxem 
burg 

Nether 
lands 

No maritime cabotage 

not applicable 

Not restricted 

not applicable 

not applicable 

not applicable 

register 
Independent 
mainly used  by  Belgian 
owners.  Captain  EU 
licence 
citizen,  * 
by 
recognised 
Crew 
Luxemburg. 
according 
STWC 
standards. 

Captain Dutch national, 
other crew according to 
STCW  standards,  certi 
ficates  recognised  by 
Dutch authorities. 

Madeira register: 

- Captain  +  50%  crew 
EU 

or 

Portuguese 
nationals 

Decree  Law  368/93 
incorporates 
CR 
3577/92: 
- liberalised 

trades  are 
to  other  EU 

open 
vessels. 

Portugal 

in  Decree 

Restricted 
Regulated 
Law 368 /93 
restricted  to  Portuguese 
vessels 

Source : Merc TecnEcon 

Art.3.1  of  D.L.368/93 
allows for  authorization 
Minister  use  of  other 
vessels 
case  of 
in 
demand. 

100%  Portuguese  or 
EU nationals. 

31 

not applicable 

- none  specifically 

for 

seafarers 

>50% 

by 
Owned 
nationals  of  EU  or 
commercial  companies 
with registered  office  in 
EU, if significant part of 
management  is  handled 
from  Luxembourg 

not applicable 

- Exemption 

Social 
Security  payment 
/ 
income  tax  lower  tax 
brackets for seafarers, 

- Choice 

between 
corporate  or  tonnage 
tax. 

Madeira register: 

(branch)  office 

- 
Madeira 

in 

Decree  Law  293/91 
Art.30 D: 

- taxation  on 30% of the 
profit 
the 
transport activity only. 

from 

part 

2/3  vessel  must  belong 
to  Dutch 
national 
persons or  legal  entities 
with  EU  nationality. 
Substantial 
of 
(operational) 
management 
be 
Dutch/  organised  from 
in 
Holland,  regulated 
Law  of  Commerce  Art. 
311. 

to 

Decree  Law  414/86 
states: 

national 
- Portuguese 
controlling 
>50% 
capital/management  of 
vessel. 
in 
Portuguese territory. 

Office 

- definition  414/86  is  in 
line  with  Community 
law. 

Country 

Basic  principle  on 
cabotage 

Comment 

Waiver system 

Crew nationality  requirements 

Vessel ownership requirements 

Fiscal regime 

Spain 

• C.R.3 577/92 

was 
temporarily  suspended 
until  February  ^4  for 
some  industrial  main 
land cargoes. 

Restricted 
Regulated 
in  Law 
27/1992  on  State  Ports 
and Merchant Marine. 
Decree  392/96  allows 
REC 
participation 
vessels 
certain 
in 
trades. 

Sweden 

Restricted 
Closed 
vessels. 

to 

foreign 

- Trades 

been 
have 
liberalised to EU vessels 
in  accordance  with  CR 
3577/92 since 1.8.95. 

-Art. 81  of Law  27/1992 
regulates  possibility  for 
waivers. 
- During 

1995 

326 

waivers were issued. 

1st Register 

2nd Register 

1st Register 

2nd Register 

Captain  and  1st  officer 
Spanish nationals,  other 
crew EU nationals. 

Canary  Island  Register 
(REC): 

- captain  &  1st  officer 

Spanish nationals, 

- other  crew  50%  EU 
possible 
for  non  EU 

nationals, 
waiver 
crew. 

Any  Spanish  company, 
or  EU  company  with 
representative  appointed 
in Spain. 

REC 

All  companies  may  use 
the 
register, 
provided  that  a  legal 
representative 
is 
appointed  in the  Canary 
Islands. 

- If 

involved 

liberalised 
crew 
to 
nationals. 

in  non-
trades  all 
EU 

be 

the 

- Exemptions  are  granted 
National 

by 
Maritime 
Administration  in  cases 
suitable 
where 
no 
is 
Swedish/EU  vessel 
available. 

None. All crew  retained 
collective  wage 
on 
agreements 
regardless 
of nationality. 

not applicable 

Law 
(1994) 
19/49 
allows fiscal allowances 
for  REC register vessels 
Spanish 
and 
ships 
registered 
operating  liner trades to 
Canaries: 

for 

- 70% 

reduction 
employer social security 
contribution 

- 25% 

deduction 
in 
calculation  base  income 
tax seafarers, 

- 35% 

reduction 

Corporate Tax 

Tax  regime  revised  end 
•93. 

- Shipowners  receive  full 
rebate  of  tax  paid  on 
seafarers'  income  plus 
additional  cash  sum  of 
SEK  29,000  per  full 
for 
time 
employee 
social 
cost 
contributions. 

not applicable 

• Governed  by  maritime 
Act  (1891:35).  More 
than  50%  should  be 
owned 
Swedish 
by 
citizens or corporations. 

- Government 

reserves 
right  to  permit  foreign 
ships 
flying  Swedish 
flag. 

Vessel >50% owned  by 
British/commonwealth/ 
EU  citizen  or  bodies 
corporate 
incorporated 
inUK/EU. 

not applicable 

Only for Shipowners; 

- depreciation allowance, 

• profit tax, 

• credit  facilities 

United 
Kingdom 

Not  restricted 

not applicable 

- For 
. ship-
'strategic' 
types:  master  British 
national. 

not applicable 

Source : Merc TecnEcon 

accordance 
standards. 

- Other 

ships 

in 
STCW 

32 

Source : Merc TecnEcon 

Country 

Basic  principle  on 
cabotage 

Comment 

Waiver system 

Crew nationality  requirements 

Vessel ownership  requirements 

Fiscal regime 

1st Register 

2nd/Register 

1st Register 

2nd Register 

Other EEA counties 

Iceland 

Not restricted 
Open coastline. 

unlimited 
Practically 
scope 
foreign 
for 
merchant  ships  to  trade 
between Icelandic ports. 

not applicable 

Norway 

Not  restricted 
- Open coastline. 
NIS vessels in principle 
but 
excluded, 
permission  is  given  for 
cargo  vessels  if  certain  . 
requirements 
fulfilled. 

are 

Under  the  scope  of  the 
Public  Transportation 
Act  1976,  all  operators 
deploying  vessels  on 
scheduled 
coastal 
passenger  services  are 
required 
to  obtain  a 
licence from the MOTC 
(also applicable to NOR 
vessels). 

NIS  vessels  can  enter 
some  cabotage  cargo 
trades.  Such  vessels  are 
entered  on  a  list  of  the 
Maritime  Directorate. 
The current list contains 
16 
vessels,  mostly 
highly  specialised  gas 
tankers. 

not applicable 

- Since  EEA,  all  EEA 
eligible 
are 

citizens 
crew. 

-Under  Act 

26/1987 
Employment  Rights  of 
Foreigners, all non EEA 
crew  must  obtain  work 
from  Miaof 
permit 
Social  Affairs 
for 
entering  in  employment 
on board. 

- None,  except  master 

NIS register: 

must be Norwegian. 

- All  crew  retained  on 
collective  wage  agree 
ments. 

- General requirement  for 
master. 
Norwegian 
exemptions 
However 
for  other  nationalities 
are readily available. 

33 

- Governed 

by 
Registration  of  ships 
115/1985, 
Act 
previously 
limited 
registration  to  Icelandic 
nationals and residents. 
- Amending  Act  62/1992 
of 
gives 
registration 
to 
citizens/corporations  of 
EEA countries. 

right 

Ordinary 
(NOR) 
the 

- Norwegian 
Register 
governed 
Maritime 
Transportation Act. 

by 

- Open 

by 

only 

to 
Norwegian 
citizens/ 
residents  or  unlimited 
partnership  where  at 
least  60%  of  ownership 
is 
Norwegian 
citizens  or  the  owner  is 
company 
a 
where 
60 
percent  of  the  capital 
and  operating  powers 
are in Norwegian hands. 

limited 
at 

least 

not applicable 

by 

- NIS  register  put  into 
the 

operation 
Norwegian 
Ship 
International 
Register  Act  of  12.6. 
1987. 

- Ownership 

company 

as 
for 
requirements 
If  nationality 
NOR. 
conditions  are  not  met, 
registration  also open to 
limited 
or 
partnership  with  head 
office 
in  Norway,  or 
shipowning  partnership 
with  Norway 
based 
managing  owner,  or 
owner  with  appointed 
representative 
accept 
authorised 
writs  on  behalf  of  the 
owner. 

to 

- Seafarers 

obtain 

following tax privileges: 
- income tax  deduction  US 
$  10,4 x 1.49  for each sea 
day. 

- shipowners do not receive 
for 

any  rebates/refunds 
social cost contributions. 

- All crew members serving 
onboard  NOR  or  NIS 
to 
vessels  are  entitled 
deduction 
tax 
special 
limited to 30% from  their 
gross 
income,  but  not 
more  than  NKr  70,000 
pa.  Limited  to  seafarers 
working  for  a  minimum 
sailing period. 

- Tax  rebate  system  from 
1994 providing refunds to 
shipowners of tax paid on 
seafarers'  wages.  Rebates 
only  available  for  crew 
members 
resident/liable 
for  taxation  in  Norway. 
Restricted to NOR vessels 
except  where  entire  crew 
fulfil 
vessels 
NIS 
residence/liability 
requirements. 

Note: Two of the (former) EEA countries had bilateral and reciprocal cabotage agreements with other EEA and/or EU countries; 

Sweden: with Norway, incl. NIS and some of the EU Member States, 

Norway: with Sweden, Iceland, Denmark, UK and Portugal. 

Source: MERC/TecnEcon 

34 

ANNEX II 

Table  A.2  Overview  of cabotage  developments  by EU  Member State (mln  tonnes) 

Category 

DRY  BULK 

LIQUID  BULK 

GEN. CARGO 

TOTAL 

TOTAL 

EU 

Member 

mainl. 

islands 

mainl. 

islands 

mainl. 

islands 

mainl. 

islands 

Belgium  1984 

NA 

1992 

x NA 

-

1993 

1994 

1995 

Den- 

1987e> 

3.9 

3.0 

NA 

NA 

0.05 

0.05 

0.05 

0.5 

NA 

NA 

-

2.6 

m a rk 

1992e) 

5.25 

2.05 

0.55 

2.65 

4.25 

1.9 

0.45 

2.5 

1993e> 

1994<=) 

1995e) 

Finland 

1992 

4.2 

4.1 

0.6 

1.85 

1.8 

0.55 

1993 

0.55 

0.45 

0.5 

0.6 

4.1 

4.1 

2.75 

3.2 

0.05 

0.05 

1994 

1995e) 

France") 

1984 

1992 

1993 

1994 

1995») 

W.Germ.  1987 

0.7 

0.8 

2.4 

1.6 

1.6 

2.0 

1.9 

0.5 

-unified 

1992 

1.45 

G e r m a ny  1993 

0.95 

1994 

1995 

Greece 

1984 

1992 

1993 

0.7 

0.8 

3.0 

3.7 

3.7 

0.45 

4.75 

0.05 

0.5 

0.3 

0.3 

0.2 

0.2 

0.2 

-

3.55 

4.1 

4.1 

4.45 

0.05 

7.2 

6.8 

6.5 

5.7 

5.5 

1.5 

7.35 

6.05 

5.8 

6.15 

6.5 

6.0 

6.0 

0.3 

0.3 

0.3 

0.45 

0.4 

0.1 

0.1 

0.1 

0.1 

0.9 

2.0 

2.0 

xz 

-

-

-

0.05 

0.05 

0.05 

0.6 

0.4 

0.4 

NA 

NA 

0.05 

0.05 

0.05 

4.4 

5.8 

4.7 

4.7 

4.7 

4.7 

4.65 

5.45 

-

14.2 

12.9 

13.9 

14.1 

14.5 

0.7 

0.6 

0.6 

5.25 

0.65 

9.6 

8.4 

8.1 

7.7 

7A 

2.0 

8.85 

7.05 

1.8 

1.5 

1.4 

1.5 

1.5 

0.6 

0.6 

-

8.6 

8.2 

9.5 

95 

9.5e) 

0.1 

0.1 

0.1 

0.1 

1.2 

0.9 

0.9 

0.85 

0.9 

0.5 

0.5 

NA 

NA 

0.05 

0.05 

0.05 

18.6 

18.7 

18.6 

18.8 

19.2 

5.4 

5.25 

6.05 

5.9 

11.4 

9.9 

9.5 

9.2 

8.9 

2.0 

9.45 

7.65 

7.1 

7.6 

0.05 

0.45 

6.55 

0.55 

0.5 

2.0 

2.4 

7.0 

0.6 

10.1 

6.45 

16.55 

10.1 

2.4 

10.1 

8.5 

8.5 

18.6 

18.6 

Category 

DRY BULK 

LIQUID BULK 

GEN. CARGO 

TOTAL 

TOTAL 

EU 

Member 

1994 

1995») 

Ireland 

1984 

4.1 

0.05 

1992 

0.15 

0.3 

0.1 

0.05 

4.85 

5.4 

5.1 

4.9 

5.6 

0.3 

0.4 

0.4 

0.4 

0.1 

0.1 

0.1 

Italy 

1993 

1994 

1995 

1984 

1992 

1993 

1994 

1995e) 

Nether-  1984e) 

lands 

1992 

1993 

1994 

1995») 

Portugal  1984 

1992 

1993 

1994 

1995 

Spain 

1984 

8.15 

mainl. 
4.0 

islands 
4.4 

mainl. 
5.0 

islands 
1.7 

mainl. 
035 

islands 
3.1 

mainl. 
9.35 

islands 
9.2 

4.5 

-

8.35 

4.8 

0.45 

0.55 

0.55 

0.6 

0.65 

7.5 

1.5 

0.3 

3.2 

-

-

-

9.2 

-

9.2 

0.5 

0.7 

0.85 

0.7 

0.7 

21.4 

4.0 

6.9 

16.35 

36.65 

10.8 

6.65 

23.15 

5.85 

11.65 

17.9 

45.6 

17.6 

3.75 

23.9 

17.2 

4.4 

25.75 

16.55 

4.65 

22.8 

2.1 

2.0 

2.8 

1.0 

1.45 

1.25 

0.9 

0.7 

0.5 

0.5 

0.5 

0.5 

0.3 

0.9 

-

-

3.0 

5.0 

4.3 

4.3 

4.3 

16.2 

0.2 

0.4 

0.4 

0.4 

0.4 

5.5 

-

-

2.45 

7.4 

6.9 

6.5 

0.15 

0.2 

0.2 

0.2 

0.2 

0.4 

0.8 

0.8 

1.0 

1.0 

5.1 

10.95 

48.9 

11.3 

49.85 

13.05 

45.85 

1.15 

1.65 

1.45 

1.1 

0.9 

1.1 

1.7 

1.7 

1.9 

1.7 

0.3 

0.4 

0.4 

0.4 

3.1 

5.1 

4.4 

43 

43 

26.8 

11.5 

1992 

4.9 

1.2 

11.65 

6.65 

0.3 

9.8 

16.85 

17.65 

1993 

4.25 

0.95 

9.5 

6.4 

035 

10.15 

14.1 

17.5 

1994 

4.65 

0.85 

8.15 

8.45 

0.25 

11.05 

13.05 

20.35 

1995 

Sweden 

1992 

4.05 

3.55 

1993 

3.55 

1994 

3.55 

1995e» 

United 

1984 

4.1 

4.7 

0.95 

1.85 

1.7 

1.4 

1.7 

-

9.65 

6.9 

7.15 

7.15 

7.55 

32.5 

12.85 

0.2 

12.8 

0.1 

0.1 

0.1 

0.1 

8.8 

0.1 

0.1 

0.45 

0.15 

30.0 

-

-

36 

13.9 

10.45 

10.7 

10.7 

11.65 

37.2 

26.6 

2.05 

1.9 

1.95 

1.95 

38.8 

18.55 

18.4 

0.5 

0.7 

0.85 

0.7 

0.7 

53.0 

63.5 

59.85 

61.15 

58.9 

1.15 

1.95 

1.85 

1.5 

13 

4.2 

6.8 

6.1 

6.2 

6.0 

38.3 

34.5 

31.6 

33.4 

40.5 

12.5 

12.6 

12.65 

13.6 

76.0 

Category 

DRY BULK 

LIQUID BULK 

GEN. CARGO 

TOTAL 

TOTAL 

EU 

Member 

Kingdom  1992 

(incl. 

1993 

offshore) 

1994 

1995«) 

mainl. 
8.5 

islands 
2.0 

mainl. 
26.1 

islands 
29.7 

mainl. 

islands 
9.0 

mainl. 
34.6 

islands 
40.7 

7.4 

8.6 

7.5 

2.0 

4.6 

3.5 

28.9 

23.8 

9.5 

363 

353 

34.7 

23.2 

10.2 

43.3 

38.0 

EU-12 

84/87 

27.65 

17.6 

75.35 

42.0 

17.0 

60.9 

75 

49.5 

28.0 

7.05 

33.15 

110.05 

111.65 

75.3 

71.6 

813 

77.5 

221.7 

1992 

31.35 

22.4 

70.65 

64.95 

6.6 

43.45 

108.6 

130.8 

239.4 

1993 

28.05 

28.5 

66.05 

59.4 

2.9 

41.35 

97.0 

129.25 

226.25 

EU-15 

1994 

33.8 

32.35 

81.1 

633 

2.65 

43.45 

117.55 

139.1 

256.65 

1995 

33.4 

30.7 

90.35 

58.45 

3.35 

423 

127.1 

131.45 

258.55 

OTHER EEA 

Iceland 

1993 

0.05 

1994») 

0.05 

-

1995») 

Norway 

1993 

1994») 

1995») 

0.05 

8.0b> 

8.0 

8.0 

0.3 

0.3 

0.3 

• 

0.05 

0.05 

0.05 

NA 

NA 

NA 

4.55b> 

22.0 

1.25W 

4.5 

4.5 

27.0 

25.0 

1.2 

1.2 

0.4 

0.4 

0.4 

NA 

NA 

NA 

-

NA 

NA 

NA 

-

NA 

NA 

NA 

0.4 

0.4 

0.4 

35.8 

40.7 

38.7 

a)  Consultants estimate. 

b)  Mainland and island trade together. 

c) 

Includes estimated data, on trade volume, trades area or commodity allocation. 

d)  Only European cabotage. 

e) 

Provisional figures for major ports with total cargo volumes >2 mln tonnes only. 

37 

ANNEX III 

North European coastal fleet") according to register per 1/7/1994 and 1/7/1996. 

country 

Number 

1000 GT  Tonnage* 

1000 DWT 

remarks 

1994 

1996 

1994 

1996 

1994 

1996 

Belgium") 

Denmark 

Germany 

Ireland 

Netherlands 

Un.Kingdomc) 

23 

129 

551 

54 

237 

493 

17 

127 

373 

49 

248 

470 

78 

199 

650 

95 

450 

66 

213 

550 

98 

480 

1,585 

1,734 

37 

92 

36 

88 

13 cargo and 4 large passenger/ferries 

70 cargo vessels & 57 ferries 

1,040 

866 

incl. 266 small coasters - 577,000 DWT 

130 

602 

972 

134 

incl. 38 small coasters - 100,000 DWT 

680 

incl. 175 small coasters - 400,000 DWT 

956 

inc. 116 RoRo, 188 coasters, 32 pass. 

Total EU-12 

1,487 

1,284 

3,057 

3,141 

2,873 

2,760 

Austria 

Finland 

Sweden 

Total EU-15 

29 

323 

280 

1,916 

60 

140 

180 

100 

all small dry cargo vessels 

100 

incl. 190 small pass.vsl, agr. 27,000 GT 

150 

all extremely small vessels 

3,521 

3,110 

a)  Vessels < 6,000 GT and all ferries. 

b) 

Total fleet. 

c) 

UK owned trading fleet. 

d) 

contains various estimates. 

South European cabotage fleet per 1/7/1994 and 1/7/1996 

country 

number 

1000 GT  Tonnage')  1000 DWT 

remarks 

1994 

1996 

1994 

1996 

1994 

1996 

France") 

Greece 

Italy 

Portugal 

Spain 

Total 

86 

498 

372 

22 

210 

90 

515 

362 

15 

209 

539 

510 

1,249 

1,900 

672 

63 

575 

1,036 

120 

900 

713 

440 

569 

83 

784 

731 

incl. 18 large RoRo+27 mainland coasters 

563 

incl. 15 cruise+200 ferries+250  coasters 

619 

incl. 140 ferries/hydrof.and  109 tankers 

75 

868 

1 small passenger+14 dry cargo vessels 

incl.25 tankers+54 larger ferries 

1,188 

1,191 

3,098 

4,466 

2,589 

2,856 

total South European cabotage fleets 

a)  Contains various estimates. 

b) 

Excluding some smaller local ferries. 

z* 

ANNEX IV 

Tables 4.1 and 4.2 present overviews of the respective  fleets. 

Table 4.1  Fleet developments of DIS register ( 1992-1996) 

Ship type 

number 

Tonnage 

1000GRT/GT 

1000 DWT 

1992 

1994 

1996 

1992 

1994 

1996 

1992 

1994 

1996 

237 

86 

100 

6 

44 

228 

215 

918 

889 

950 

1,555 

1,491 

1,511 

98 

99 

7 

46 

93 

90 

6 

44 

1,990 

2,093 

2,177 

2,217 

2,360 

2,483 

2,160 

1,567 

1,979 

3,965 

2,740 

3,500 

84 

56 

122 

66 

136 

75 

16 

65 

20 

75 

17 

73 

473 

478 

448 

5,208 

4,737 

5,318 

7,818 

6,686 

7,584 

Trampers 

Liners 

Tankers 

Pass./ferries 

Other 

Total 

Table 4.2  The fleet of the MAR register ( 1994-1996) 

Shipowners 

Portuguese 

Non Portuguese 

Type of Vessel 

Shipowners 

Shipowners 

Total 

1996 

Total 

1994 

N° 

DWT 

Crew 

N° 

DWT 

Crew 

27 

89.1 

230 

General Cargo 

Containers 

Dry Bulk 

Liquid Bulk 

LPG 

Passenger 

RoRo 

Total 1996 

Total 1994 

4 

2 

2 

7 

2 

2 

12.*4 

6.2 

27.8 

33 

20 

25 

545.1 

110 

9.6 

0.9 

24 

43 

19 

602.0 

24 

739.5 

255 

324 

N° 

31 

2 

9 

9 

4 

3 

DWT 

Crew 

N° 

DWT 

Crew 

101.5 

263 

6.2 

113.7 

832.2 

18.6 

1.0 

1.6 

20 

102 

145 

45 

47 

11 

9 

3 

3 

29.2 

10.9 

34.1 

85 

33 

38 

16 

1,377.9 

284 

2 

2 

9.6 

2.7 

24 

85 

7 

2 

2 

1 

1 

85.9 

287.1 

9.0 

0.1 

1.6 

77 

35 

21 

4 

11 

*  1 

40 

472.8 

378 

59 

1,074.8 

633 

11 

724.9 

35 

1,463.4 

549 

23 

ANNEX V 

Table 3.3 

COMPARATIVE NET MANNING COSTS:  GENERAL CARGO VESSEL  1,500  GT 

Register 

Crew Complement 
(number/nationality) 

Total 
Crew 

Back up 
factor(l) 

Total Manning 
Cost (US$ 
'000/year) 

Index 

Officers 

Ratings 

Officers/ 
Ratings 

6E + 0F 

6E + 0F 

12 

1.6/1.6 

France* 

Belgium* 

Sweden* 

France 

LuxernDourg* 

Finland* 

Spain * 

Norway (NOR)* 

Denmark* 

Iceland 

Ireland* 

Greece 

5E + 0F 

4E + 0F 

4E + 0F 

4E + 2F 

5E + 0F 

5E + 0F 

5E + 0F 

4E + 0F 

3E + 0F 

5E + 0F 

5E + 0F 

1E  + 5F 

4E + 0F 

6E + 0F 

6E + 0F 

3E + 0F 

3E + 0F 

5E + 0F 

4E + 0F 

4E + 0F 

5E + 0F 

7E + 0F 

United Kingdom* 

4E + 0F 

4E-K)F 

Germany* 

3E + 0F 

3E + 0F 

DIS (Danish crew) 

3E + 0F 

3E  + 0F 

Italy* 

5E + 0F 

4E+0F 

Spain (Canary) 

Portugal 

Germany (ISR) 

Norway (NIS)* 

Netherlands * 

Portugal (MAR) 

5E + 0F 

3E + 0F 

2E+1F 

3E + 0F 

3E+2F 

4E+0F 

0E + 3F 

0E + 4F 

3E-+0F 

2E+2F 

DIS (minimum) 

1E  + 2F 

0E + 4F 

9 

9 

12 

9 

11 

11 

7 

6 

10 

8 

12 

8 

6 

6 

9 

11 

9 

6 

7 

6 

9 

7 

1.5/1.5 

2.0/2.0 

1.6/1.6 

1.5/1.5 

2.0/2.0 

1.5/1.5 

2.0/2.0 

1.8/1.4 

1.5/1.5 

1.5/1.5 

1.2/1.2 

1.5/1.5 

1.8/1.8 

1.8/1.4 

1.6/1.6 

1.5/1.5 

1.5/1.5 

2.0/2.0 

1.7/1.2 

1.5/1.5 

1.8/1.4 

(Ave =100) 

1,594 

1,214 

1,068 

895 

941 

768 

724 

720 

707 

645 

642 

620 

•618 

580 

560 

525 

516 

501 

379 

355 

368 

303 

239 

237 

180 

159 

133 

140 

114 

108 

107 

105 

96 

95 

92 

92 

86 

83 

78 

77 

74 

56 

53 

55 

45 

35 

AYfraft; 

(a) 

Applies to national seafarers only 

673 

100 

E: 

F: 

*: 

EU/EEA nationals 

Foreign 

Based on ISF data 

Source: 

MERC/TecnEcon 

4"> 

Table 3.4 

COMPARATIVE MANNING COSTS:  GENERAL CARGO VESSEL 3,300 GT 

Crew Complement 
(number/nationality) 

Total 
Crew 

Back up 
factor00 

Total Manning 
Cost (US$ 
'000/year) 

Index 

Officers 

Ratings 

Officers/ 
Ratings 

(Ave =100) 

Register 

France* 

Belgium* 

Denmark* 

Sweden* 

France 

melen) 

7E + 0F 

6E + 0F 

9E + OF 

4E + 0F 

6E + 0F 

4E + 0F 

5E + 0F 

5E + 0F 

4E + 3F 

3E + 6F 

7E + 0F 

9E + 0F 

Luxembourg* 

6E + 0F 

4E + 0F 

DIS (Danish crew) 

6E + 0F 

4E + 0F 

Norway (NOR)* 

5E + 0F 

4E + 0F 

Spain * 

Greece 

Ireland* 

6E + 0F 

8E + 0F 

6E + 0F 

7E + OF 

5E + 0F 

5E + 0F 

United Kingdom* 

5E + 0F 

5E-K)F 

Iceland 

Italy* 

Germany* 

Spain (Canary) 

6E + 0F 

5E + 0F 

6E + 0F 

7E + 0F 

3E + IF 

2E + 4F 

Portugal 

5E + 0F 

8E+0F 

Germany (ISR) 

3E+1F 

DIS (minimum) 

2E + 4F 

2E + 4F 

0E + 5F 

Netherlands * 

5E + 0F 

0E+3F 

Norway (NIS)* 

2E + 2F 

0E + 4F 

Portugal (MAR) 

3E+2F 

2E+4F 

A v p r aw 

(a) 

E: 

F: 

*. 

applies to national seafarers only 

EEA nationals 

Foreign low cost 

bases on ISF data 

Source: 

MERC/TecnEcon 

2,041 

1,385 

1,267 

1,220 

1,114 

1,107 

1,062 

991 

925 

909 

840 

802 

772 

691 

670 

671 

656 

621 

559 

432 

398 

385 

348 

236 
160 

147 

141 

129 

128 

123 

115 

107 

105 

97 

93 

89 

80 

78 

78 

76 

72 

65 

50 

46 

45 

40 

864 

100 

16 

10 

10 

10 

16 

16 

10 

10 

9 

14 

13 

10 

10 

11 

13 

10 

14 

13 

10 

11 

8 

8 

11 

1.8/1.8 

1.5/1.5 

1.8/1.4 

2.0/2.0 

1.8/1.8 

2.0/2.0 

1.5/1.5 

1.8/1.4 

2.0/2.0 

1.5/1.5 

1.2/1.2 

1.5/1.5 

1.5/1.5 

1.5/1.5 

1.6/1.6 

1.8/1.8 

1.5/1.5 

1.5/1.5 

1.8/1.4 

1.7/1.2 

2.0/2.0 

1.5/1.5 

fc 

Table 3.5 

COMPARATIVE MANNING COSTS:  PRODUCTS TANKER 9,000 GT 

Register 

Crew Complement 
(number/nationality) 

Total 
Crew 

Back up 
factor(a) 

Total Manning 
Cost(US$ 
'000/year) 

Index 

Officers 

Ratings 

Officers/ 
Ratings 

Ave =100 

France* 

Belgium* 

7E + 0F 

11E + 0F 

7E + 0F 

5E + 0F 

Norway (NOR)* 

7E + 0F 

8E + 0F 

Denmark* 

Sweden* 

7E + 0F 

5E + 0F 

6E + 0F 

6E + 0F 

Luxembourg* 

7E + 0F 

5E+0F 

Finland* 

7E + 0F 

11E + 0F 

DIS (Danish crew) 

7E + 0F 

France 

Greece 

Spain * 

Italy* 

4E + 3F 

4E + 3F 

7E + 0F 

7E + OF 

7E + 0F 

Germany (ISR) 

4E + 3F 

Ireland* 

Portugal 

Spain (Canary) 

4E + 0F 

7E + 0F 

5E + 0F 

3E + 8F 

3E+10F 

13E + 0F 

10E + 0F 

13E-K)F 

3E+10F 

8E + 0F 

11E4ÛF 

United Kingdom* 

4E + 0F 

8E-KJF 

Iceland 

7E + 0F 

7E + 0F 

Norway (NIS) 

4E + 3F 

0E + 8F 

Netherlands* 

7E + 0F 

0E + 8F 

Portugal (MAR) 

4E+3F 

5E+6F 

DIS (minimum) 

2E + 5F 

0E + 6F 

18 

12 

15 

12 

12 

12 

18 

12 

18 

20 

20 

17 

20 

20 

12 

18 

17 

12 

14 

15 

15 

18 

13 

1.8/1.8 

1.5/1.5 

2.0/2.0 

1.8/1.4 

2.0/2.0 

1.5/1.5 

2.0/2.0 

1.8/1.4 

1.8/1.8 

1.8/1.8 

1.2/1.2 

1.5/1.5 

1.6/1.6 

1.5/1.5 

1.5/1.5 

1.5/1.5 

1.5/1.5 

1.5/1.5 

2.0/2.0 

1.7/1.2 

1.5/1.5 

1.8/1.4 

2,223 

1,646 

1,531 

1,503 

1,464 

1,267 

1,213 

1,178 

1,144 

1,129 

1,100 

1,094 

1,180 

941 

878 

864 

861 

854 

821 

739 

617 

546 

476 

202 

150 

139 

137 

133 

115 

110 

107 

104 

103 

100 

100 

107 

86 

80 

79 

78 

78 

75 

67 

56 

50 

43 

Average 

1.099 

100 

(a) 

E: 

F: 

* : 

Applies to national seafarers only 

EEA nationals 

Foreign low cost 

based on ISF data 

Source: 

MERC/TecnEcon 

« 

ISSN 0254-1475 

COM(97) 296 final 

DOCUMENTS 

EN 

07  13 

Catalogue number  : CB-CO-97-288-EN-C 

ISBN 92-78-21421-3 

Office  for Official  Publications of the European Communities 

L-2985  Luxembourg