McGILL LAW JOURNAL
REVUE DE DROIT DE McGILL
Vol 24
Montreal
1978
No. 1
Flags of Convenience – New Dimensions to an Old Problem
Lawrence L. Herman*
The “Argo Merchant” syndrome
Of late, much commentary has been made regarding the pro-
blems posed to the international community and to individual states
by the widespread existence of large oil-carrying vessels registered
in so-called flag of convenience jurisdictions.’ Most of the recent
public concern has been focussed on tanker disasters occurring large-
ly in the United States and involving vessels registered in Liberia and
Panama, by far the largest flag of convenience jurisdictions The
* The author, of the Saskatchewan and Ontario Bars, is a member of the
Bureau of Legal Affairs, Department of External Affairs, Ottawa. The author
is grateful to Mr B.M. Mawhinney, Department of External Affairs, for his
advice in the preparation of this article.
1A “flag of convenience” can be generally defined “as the flag of any
country allowing the registration of foreign-owned and foreign-controlled
vessels under conditions which, for whatever the reasons, are convenient and
opportune for the persons who are registering the vessels”. See Boczek, Flags
of Convenience (1962), 2.
2A recent study by the UNCTAD Secretariat states that as a result ot tie
rapid expansion of fleets registered in Liberia and to a lesser extent Panama
during the period 1965-1976 as well as in newer flag of convenience or “open
registry” countries, the open registry fleets in 1976 accounted for 34% of the
world tanker tonnage and 30% of world bulk carrier tonnage. Out of a total
world merchant fleet tonnage of 367.1 million gross registered tonnage (grt)
in 1976, Liberia accounted for 73.5 grt or roughly 20% of the world total. Flag
of convenience registrations accounted for 27.6% of the total world grt in
1976. These figures are based on Lloyd’s Register of Shipping: Statistical Tables.
Economic Consequences of the Existence or Lack of a Genuine Link Between
Vessel and Flag of Registry, Report by the UNCTAD Secretariat, 22-26, U.N.
Doc. TD/B/C. 4/168, (1977). A 1975 study entitled “World Shipping Under
McGILL LAW JOURNAL
[Vol. 24
singular disaster which, in large part, provided the stimulus for much
of this concern involved the 640-foot Liberian-flag tanker Argo Mer-
chant, which broke up southwest of Nantucket Island on December
21, 1976, spilling about 7.5 million gallons of heavy oil into the sea
and causing a serious threat to the rich George’s Bank fishing
ground.a In addition, other disasters involving Liberian-registered
vessels have recently occurred,4 the most recent being the super
tanker, Amoco-Cadiz, which ran aground off northwestern France on
March 16, 1978, spilling 58 million gallons of oil over fishing and
oyster grounds. These incidents have contributed to a general re-
cognition of the inadequacy of present international rules that allow
ancient, poorly-repaired, ill-equipped or inadequately manned and
navigated vessels into ocean-borne trade service. Speaking recently
on the need for international co-operation in controlling vessel-source
pollution, the Canadian Minister for Fisheries and the Environment
declared that “the present method whereby many countries register
their vessels under another nation, otherwise known as ‘flags of
convenience’ is … inadequate …. 6
The problem of flag of convenience jurisdictions exemplifies some
of the shortcomings of present-day international law and demons-
trates the absence of coherent rules or standards, applicable on a
global basis, which would help to regulate maritime safety and to
ensure the environmental protection of the oceans. The problem
has two aspects. First, there is the set of issues regarding the very
existence of flag of convenience registries and the consequent desir-
ability (or necessity) of establishing international rules prescribing
Flags of Convenience” prepared by a firm of U.K. shipping consultants says
that of the total of U.S.-owned tanker tonnage under foreign registry, 46.5%
is registered in Liberia; The Globe and Mail, Jan. 10, 1977, 1. As reported in the
Vancouver Sun, Jan. 5, 1977, Lloyd’s record of tanker incidents, compiled from
reports provided by the firm’s worldwide network of some 1,400 agents and
published in Lloyd’s List, shows that Liberian and other flag of convenience
tankers were responsible for 2/3 of the estimated 15 million gallons of oil
dumped into oceans and coastal waters as a result of tanker mishaps as of
Sept. 30, 1976.
3 See The New York Times, Dec. 21, 1976, 20; Dec. 22, 1976, 1; Dec. 23, 1976, 1:
4 In 1976, a total of 19 tankers were lost, according to the Tanker Advisory
Center in New York out of which 11″ were Liberian flag vessels. See The
New York Times, Feb. 13, 1977, 1.
5 See Kifner, “Flag of Convenience Oil Tankers Magnifying Concern About
Spills”, The New York Times, Feb. 13, 1977, 1; “Liberia: A Phantom Maritime
Power Whose Fleet Is Steered By Big Business”, The New York Times, Feb.
14, 1977, 14; “Tanker That Blew Up Provides Insight Into Oil Shipping”, The
New York Times, Feb. 15, 1977, 10.
6 Halifax Chronicle Herald, Dec. 31, 1976.
1978]
FLAGS OF CONVENIENCE
minimum requirements for vessel registration together with inter-
national sanctions for failure to comply with these standards. The
second aspect of the problem concerns the need to ensure a reason-
able balance, on the one hand, between the rights and interests of
flag states in ensuring the maintenance of freedom of commerce
on the seas, and the rights and interests of coastal states, on the
other, to protect the integrity of their coastal environment. These
two aspects are inseparably related.
This article will attempt to demonstrate that the old flag of con-
venience/genuine link controversy (i.e., the need to ensure an ade-
quate legal relationship between the owner of a particular vessel
and the state of registry) is much less an international issue than
the need to ensure adequate protection for the marine environment
by requiring all vessels to comply with minimum standards of-
construction and safety, regardless of the existence of a so-called
“genuine link”. One avenue under consideration at the current Law
of the Sea Conference is to place greater obligations on flag states
in matters of vessel safety and management. Enhanced coastal state
jurisdiction in carefully defined areas 6
a may, in addition, offer a
complementary and perhaps ultimately a more realistic solution
to the problem. However, in considering the multiplicity of issues
involved in the flag of convenience problem, it must also be born
in mind that the availability of flag of convenience or open registry
jurisdictions is not of itself necessarily a negative factor, since such
jurisdictions contribute to the efficiency of international commerce
by providing the basis for increased availability of shipping ser-
vices. Viewed from this perspective, the problem which the inter-
national community faces is not simply the limitation of open re-
gistries but rather the development of sound rules of law which
ensure against the deployment of substandard vessels, regardless of
registry.
The use of flag of convenience jurisdictions –
the registration
and operation of vessels beneficially owned and controlled by foreign
interests under the laws of certain states with only a tenuous con-
is not a new
nection between the state of registry and the vessel –
Ga An issue of considerable importance to states such as Canada at the Law
of the Sea negotiations.
7 The term has a variety of connotations, some pejorative, others commend-
atory or neutral: Goldie, Recognition and Dual Nationality –
A Problem of
Flags of Convenience (1963) 39 Brit.Yb.Int’l L. 220. The Report of the UNCTAD
Secretariat, supra, note 2, 22, refers to flag of convenience states more di-
plomatically as countries of “open registry”. Until recently, the term referred
to vessels registered in Panama, Liberia and Honduras –
the so-called Panlib-
McGILL LAW JOURNAL
[Vol. 24
phenomenon. As early as the sixteenth and seventeenth centuries
English merchants resorted to their use in attempts to circumvent
Spanish trading monopolies in the West Indies; similarly, American
entrepreneurs have, almost since the birth of the Republic, used
foreign flags to their advantage.” In particular, use of Panamanian
registry as a registry of convenience began in earnest shortly after
World War One, but the heyday of flag of convenience registration
came out of the highly competitive world shipping conditions pre-
vailing at the end of the Second World War.9 Reasons for choosing
flag of convenience registrations vary, but many shipowners, prin-
cipally those in the United States, have found foreign registration
an extremely advantageous method of reducing operating costs.
Lower wages are paid to non-U.S. seamen and American
laws
.regarding labour relations, wages and crew composition can be
avoided.’ Other advantages include the avoidance of heavier na-
tional taxation policies and the facility of currency conversion. In
addition, it appears that one motivation for foreign registration by
European shipowners may have been the fear of nationalization
following the Second World War.”
In addition to these cost-saving factors, flag of convenience
registration permits shipowners to evade national laws and regula-
tions which control the design, construction, manning and equip-
ment of vessels. The evasion of such safety measures has become
a major issue in light of the growing demand for adequate national
and international standards to protect the world’s oceans from
recurring maritime pollution disasters, a demand amply justified by
the Argo Merchant and Amoco-Cadiz disasters.
Flags of convenience also allow shipowners to avoid international
rules and standards applied under treaties or conventions respecting
hon vessels. In recent years, however, Honduras has declined in importance as
a flag of convenience jurisdiction, and today the major states of importance
in this regard are Liberia and Panama: OECD Study on Flags of Convenience
(1972-73) 4 J.Mar.L.& Com. 231, 235.
8 Goldie, supra, note 7, 224.
9 See Boczek, supra, note 1, 9-16; OECD Study on Flags of Convenience, supra,
note 7, 233-37; Report of UNCTAD Secretariat, supra, note 2, 24 for a capsulat-
ed history of the recent growth of the flag of convenience phenomenon.
10 The U.S. labour movement is concerned that American labour has been
displaced by cheaper foreign labour aboard flag of convenience ships. For a
thorough study of the legal action taken by U.S. maritime unions and the
decisions of U.S. courts regarding union activities against flag of convenience
vessels, see Goldie, supra, note 7.
11 See generally Boczek, supra, note 1, ch.II; OECD Study on Flags of Con-
venience, supra, note 7, 243-47.
19781
FLAGS OF CONVENIENCE
maritime safety, fisheries and nuclear liability.-2 However, in all
fairness to the flag of convenience states, it is important to note that
Liberia, Panama, Lebanon, Cyprus, Somalia and Nigeria’ 3 are all
parties to the 1960 International Convention for the Safety of Life
at Sea”4 and the 1966 Load Lines Convention,15 and both Panama
and Liberia are parties to the 1954 International Convention for the
Prevention of Pollution of the Sea by Oil.’ 6 Nevertheless, as has been
pointed out:
These are, however, formal requirements which can only have sense if
the administration retains direct or indirect control of their fulfilment.
This is sometimes lacking in the case of flag of convenience countries
(as well as for certain other flags) and under such circumstances the
ships involved may threaten the safety both of other ships and of the
countries whose shores they pass.17
Many other states, including Canada, have not ratified or acceded
to pollution prevention and maritime safety treaties. 18 But the
existence of jurisdictions available for vessel registry and not
committed to applying minimum international environmental and
safety standards as a matter of national policy is of concern to
the international community at large. The existence of such jurisdic-
tions, coupled with the absence of international rules applicable
to all vessels, regardless of registry, impelled the representatives
of many coastal states to attempt to alter the present state of
customary and conventional international law at the Third Law of
12Golde, supra, note 7, 221-22.
13 Traditionally, these countries are among the largest flag of convenience
jurisdictions.
14 536 U.N.T.S. 27.
16 640 U.N.T.S. 133.
16 327 U.N.T.S. 3.
17 OECD Study on Flags of Convenience, supra, note 7, 250.
18 Canada is a party to the 1960 Convention for the Safety of Life at Sea,
536 U.N.T.S. 27; the 1954 International Convention for the Prevention of Pollu-
tion of the Sea by Oil, 327 U.N.T.S. 3; the 1960 and 1972 International Regula-
tions for Preventing Collisions at Sea; the 1965 Convention on Facilitation of
International Maritime Traffic; the 1966 International Convention on Load
Lines, 640 U.N.T.S. 133; the 1969 International Convention on Tonnage Measure-
ment of Ships; the 1972 Convention on the Prevention of Marine Pollution by
Dumping. Canada is not a party to a number of important maritime conven-
tions, however, including the 1969 International Convention relating to Inter-
vention on the High Seas in cases of Pollution Casualties; the 1971 Convention
relating to Civil Liability in the Field of Maritime Carriage of Nuclear Mate-
rial; the 1971 International Convention on the Establishment of an International
Fund for Compensation for Oil Pollution Damage; the 1973 International Con-
vention for the Prevention of Pollution from Ships; and the 1974 International
Convention on the Safety of Life at Sea.
McGILL LAW JOURNAL
[Vol. 24
the Sea Conference. They argued that the current situation, whereby
flag states have complete or predominant enforcement powers,0
should be replaced by a more balanced approach which recognizes
essential coastal state interests in preventing vessel-source pollution.
This “functional sharing” of jurisdiction was explained by the Ca-
nadian representative to the Second Committee of the United
Nations Conference on the Law of the Sea (July 16, 1974) in the
following terms:
The solution to the problem [of whether the coastal state could pass
laws affecting design, construction, manning and equipment] lay not so
much in restricting the exercise of coastal-state rights to particular areas
of jurisdiction as in restricting their exercise to cases where they were
strictly necessary, and ensuring that they were applied under appropriate
safeguards on a non-discriminatory basis, in response to particular geo,
graphic, navigational or ecological situations not adequately covered by
02o
international rules and standards. This was the functional approach …
The legal significance of flags of convenience
It is an unassailable principle of international law that the high
seas (traditionally meaning that part of the oceans not included
in the territorial sea or in the internal waters of a state) are not
susceptible to possession, appropriation or subjection to national
sovereignty or other forms of national jurisdiction.21 In what was a
rationalization of the right of the Dutch to navigation and com-
merce in the Indies, Grotius provided, in a now famous passage,
the legal underpinning to the freedom of the high seas concept:
[T]hose things which are incapable of being occupied, or which never
have been occupied, cannot be the private property of any owner, since
all property has its origin as such in occupancy. The second inference
19 While, admittedly, the sovereign powers of the coastal state in its territorial
sea under Art.1 of the Geneva Convention on the Territorial Sea and the
Contiguous Zone (U.N. Doc. A/CONF.13/L.52, Apr. 28, 1958, 516 U.N.T.S. 205)
would appear to allow the coastal state the right to apply national legislation
respecting maritime safety (such as the design, manning, construction and
equipment of vessels) against foreign vessels, the corresponding right of inno.
cent passage under Art.14 of the Convention allows for arguments against any
interference with innocent passage by enforcement of national laws unless
such passage is “prejudicial to the peace, good order or security of the coastal
state”. Support for the contention that “peace, good order or security” of the
coastal state does not include threats to the environment and support for
arguments limiting the coastal state in passing laws hampering innocent
passage is found in Art.15 of the Convention and to some extent in the
Corfu Channel Case [1949] I.C.J. 4.
Records, vol.II, 317.
20 Third United Nations Conference on the Law of the Sea (1975), Official
21 Colombos, The International Law of the Sea 6th ed. (1967), 47.
19781
FLAGS OF CONVENIENCE
may be stated thus: All those things which have been so constituted by
nature that, even when used by a specific individual, they nevertheless
suffice for general use by other persons without discrimination, retain
today and should retain for all time that status which characterized them
. In the precepts of the law of
when first they sprang from nature…
nations, too, such things are described as ‘public’, that is to say, as the
common possession of all men and the private possession of none. Air
falls into this class for two reasons: first, because it is not possible for air
to be made subject to occupancy; secondly, because all men have a common
right to the use of air. For the same reasons, the sea is an element common
to all, since it is so vast that no-one could possibly take possession of it
and since it is fitted for use by all with reference to purposes of navigation
and to purposes of fishing as well.22
For centuries, the concept of the freedom of the high seas expounded
by Grotius and supported by other jurists23 was the premise upon
which international law respecting the use, transit and nationality
of vessels was developed. Exempt from the claims of all nations,
the high seas became res communis, the property of all states,
available to all for purposes of navigation, fishing, laying of sub-
marine cables and overflight.24
The corollary of the freedom of navigation on the high seas is
the right of all states to sail their vessels without hindrance or
restriction. As stated by Sir William Scott in the Le Louis case:
[A~ll nations being equal, all have equal right to the uninterrupted use
of the unappropriated parts of the ocean for their navigation: in places
where no local authority exists, where the subjects of all states meet
upon a footing of entire equality and independence, no one state, or any
of its subjects, has a right to assume or exercise authority over the
subjects of another.25
Freedom of navigation has thus been the cornerstone of interna-
tional law on the rights and obligations of states regarding both the
use of the seas by their maritime vessels and the manner in which
such vessels are to be legally identified with particular states. Free-
dom of navigation is, in turn, the basis for the development of the
modern phenomenon of flag of convenience jurisdictions.
While legal theories have posited that vessels on the’high seas
were, in a juridical sense, floating portions of the state to which
22 Grotius, De Jure Praedae (1950), Williams (trans.), ch.XII, 230-31. This
chapter entitled “Commentary on the Law of Prize and Booty” is sometimes
referred to as the Mare Librum treatise.
2 3 Le Louis [1817] 2 Dods. 210.
24These rules of customary international law have been codified in Art.2
of the 1958 Geneva Convention on the High Seas, U.N. Doc. A/CONF.131/53
and Corr. 1, 450 U.N.T.S. 82.
25Supra, note 23, 243.
McGILL LAW JOURNAL
[Vol. 24
they belonged,2 6 this fiction has now been abandoned 7 in favour
of a more functional approach:
[T]hat there is an intimate connection between the ship and the State
whose nationality she acquires which carries with it the application to
the ship of the laws of the flag-State. It is under these laws that the
captain exercises his authority and enforces it. The ship may be a chattel,
a piece of moveable property, but she is governed by special laws and her
independence, while on the high seas, from any control other than that
of the authorities of the flag-State, is universally recognized. It is not
necessary to speak of her as territory.;
Evidence of the “intimate connection” between the state and the
vessel is the flag which the vessel is required to fly. All vessels
must carry a flag as prima facie evidence of their nationality. As
Reinow states:
The entire legal system which states have evolved for the regulation of
the use of the high seas is predicated on the possession by each vessel
of a connection with a state having a recognized flag. This connection has
been commonly called nationality.29
The logical, legal implication of the right of all states to allow
their vessels to sail on the high seas is the corresponding discretion
of states to determine the conditions under municipal law which
apply to the grant of the right to fly its flag, a matter determined
to be within the exclusive competence of the state by the Permanent
Court of Arbitration in the Muscat Dhows case.30 In
that case,
Britain challenged the right of France to issue to subjects of
Muscat registration documents authorizing them to fly the French
flag. The Court held that “generally speaking it belongs to every
sovereign to decide to whom he will accord the right to fly his flag
and to prescribe the rules governing such grants” 1 This view was
restated by the United States Supreme Court in Lauritzen v. Larsen.3 2
26 The S.S. Lotus (1927) P.C.IJ., ser. A, no 10. In that case, involving a collision
between a French and a Turkish ship on the high seas and the subsequent
arrest and trial of the French captain by Turkish authorities, the Court said,
at p.25: “A corollary of the principle of the freedom of the seas is that a ship
on the high seas is assimilated to the territory of the state the flag of which
it flies, for, just as in its own territory, that state exercises its authority upon
it and no other state may do so.”
27 Chung Chi Cheung v. The King [1939] A.C. 160 (P.C.).
28 Colombos, supra, note 21, 288. See also O’Connell, International Law 2d ed.
(1970), vol2, 604-606.
29 Reinow, Nationality of a Merchant Vessel (1937), 13-14.
30 The Hague Court Reports (1916), Scott (ed.), 93.
3 1 Ibid., 96.
32 345 U.S. 571 (1952).
1978]
FLAGS OF CONVENIENCE
Controversy remains among jurists as to whether the freedom
to fix conditions for the grant of nationality to a vessel was, or
indeed should be, as unrestricted and exclusive as the Permanent
Court of Arbitration seemed to indicate. It has been suggested that
the necessary degree of certainty and precision in identification
of the national character of vessels, and hence the peaceful use of
seas, can only be assured by giving states virtually exclusive unilater-
al competence to confer nationality upon vessels. 3 However others
have argued that such unrestricted freedoms are incompatible with
the interests of the international community as a whole, contributing
to the use of flag of convenience registrations 4 and to the subjec-
tion of the community to conflicting or inadequate national laws
and policies with respect to vessel standards.
Liberals versus conservatives
Attack on the traditional view of unrestricted state competence
regarding vessel registration began with the efforts of the Institute
of International Law. At the 1896 meeting, an attempt was made to
achieve a greater degree of similarity among the laws of various
states. The Institute accepted the current doctrine of the states’
freedom as a general rule, but recognized the possibility that if
nationality were granted without taking into account some basic
rules of international law, there could be cases where the legisla-
tion of a state would be ineffective vis-h-vis other states and possibly
not acknowledged by them. The solution proposed by the Institute
was to formulate precise conditions in which a state could grant
nationality to a vessel.8 5
The next and most significant development in the attempt to
alter the state of international law and practice began with the
work of the International Law Commission in its consideration of
33See McDougal, Burke and Vlasic, The Maintenance of Public Order at Sea
and the Nationality of Ships (1960) 54 Am.J.Int’l L. 25. This principle was
followed in Lauritzen v. Larsen, supra, note 32.
34See Watts, The Protection of Merchant Ships (1957) 33 Brit.Yb.Int’l L.
52, 53: “[T]he unilateral action taken by a State in regard to the nationality
of its ships has important international consequences. Even more than with
the conferment of nationality on individuals, the conditions on the fulfilment
of which the registration of a ship depends are often unrelated to any con-
siderations of a genuine link with the particular State, but are dictated by the
demands of national commercial policy. The ‘paper nationality’ which a ship
may obtain by registration should not per se be sufficient to form the basis
of protection: a more direct and effective link must be sought.”
85 Boczek, supra, note 1, 209-15.
McGILL LAW JOURNAL
[Vol. 24
the regime of the high seas in 1950,386 work which eventually formed
the basis for the 1958 diplomatic conference which adopted the
four Geneva Conventions on the Law of the Sea. In his first report
to the International Law Commission on the Regime of the High
Seas, J.P.A. Fran;ois, the Special Rapporteur, referred to the 1896
report of the International Law Institute:
L’attribution aux navires de mer d’une identit6 et d’une nationalit6 est le
corollaire du principe du libre usage de la haute mer. D’une fagon g6nd-
rale, il appartient h tout Etat souverain de decider h qui il accordera le
droit d’arborer son pavilion et de fixer les r~gles auxquelles l’octroi de ce
droit sera soumis. Toutefois, pour 6tre en toutes circonstances efficace,
i1 faut que la lgislation d’un Etat sur cette mati~re ne s’6carte pas trop
des principes qui ont dt6 adopt6s par le plus grand nombre des Etats et
qui peuvent de ce fait m6me atre consid6r~s comme formant hi cet 6gard
un 6lment du droit internationaL37
Although there was lack of unanimity among members of the In-
ternational Law Commission concerning the desirability of limiting
traditional doctrine with respect to flag-state freedoms, the majority
followed the approach of the Special Rapporteur.3 8 In its presenta-
tion of provisional articles to the General Assembly of the United
Nations in 1955, the Commission proposed a series of conditions
respecting vessel registration which not only restrained traditional
freedoms but provided that these conditions would be a requisite
for recognition of the vessel’s national character by other states.30
In its commentary on the draft provisions, the Commission con-
cluded:
[W]ith regard to the national element required for permission to fly the
flag, a great many systems are possible; but there must be a minimum
36 See Boczek, ibid., 215-32.
31 [1950] Yb.Int’l L.Comm’n., 38.
38 Boczek, supra, note 1, 220.
39 Art.5 of the provisional articles concerning the regime of the high seas,
(1955) 2 Yb.Int’l L.Comm’n. 22, states:
“Each State may fix the conditions for the registration of ships in its
territory and the right to fly its flag. Nevertheless, for purposes of re-
cognition of its national character by other States, a ship must either:
1. Be the property of the State concerned; or
2. Be more than half owned by:
(a) Nationals of or persons legally domiciled in the territory of the
State concerned and actually resident there; or
(b) A partnership in which the majority of the partners with per-
sonal liability are nationals of or persons legally domiciled in the
territory of the State concerned and actually resident there; or
(c) A joint stock company formed under the laws of the State con-
cerned and having its registered office in the territory of that
State.”
19781
FLAGS OF CONVENIENCE
national element, since control and jurisdiction by a state over ships
flying its flag can only be effectively exercised where there is in fact a
relationship between the state and the ship other than that based on
a mere registration.40
In its report of the following year, however, the Commission
reformulated the provisional articles previously tabled. Instead of a
series of conditions relating to the grant of nationality to a vessel,
the Commission presented a general principle (reflected in Article
29) based upon the new and soon-to-be-controversial “genuine link”
approach.4 ‘ Article 29 began with the recognition of freedom of
the seas:
Each state shall fix the conditions for the grant of its nationality to ships,
for the registration of ships in its territory and for the right to fly its
flag. Ships have the nationality of the state whose flag they are entitled
to fly.
However, the new Article went on to state:
Nevertheless, for purposes of recognition of the national character of a
ship by other states, there must exist a genuine link between the state
and the ship.
The genuine link concept provoked great controversy at the
1958 Geneva Conference on the Law of the Sea, with the flag of
convenience states vehemently opposing the International Law Com-
mission formulation.42 In final adoption in plenary session at the
Conference the first two sentences of the above formulation were
accepted but the non-recognition clause in Article 29 was removed.
As adopted by the Conference, Article 5 of the 1958 Convention on
the High Seas42 a provides:
There must exist a genuine link between the state and the ship: in
particular, the state must effectively exercise its jurisdiction and control
in administrative, technical and social matters over ships flying its flag.
The inclusion of the genuine link principle in
the 1958 Con-
vention has resulted in considerable debate among jurists. It has
40 Ibid.
41 [1956] 2 Yb.Int’l L.Comm’n, 278. Referring to the 1955 provisiohal articles,
the Commission states, ibid., 279, that “after examining the comments of
Governments [it] felt obliged to abandon this viewpoint” because state practice
was too divergent to postulate universal conditions. “The Commission accor&
ingly thought it best to confine itself to enunciating the guiding principle that,
before the grant of nationality is generally recognized, there must be a genuine
link between the ship and the State granting permission to fly its flag. The
Commission does not consider it possible to state in any greater detail what
form this link should take.”
42 For a complete account of the discussions at the 1958 Conference, see
Boczek, supra, note 1, ch.IX.
42a 450 U.N.T.S. 82.
McGILL LAW JOURNAL
[Vol. 24
been argued not only that the “link” principle is counter to in-
ternational law, but also that the principle “if adopted and inter-
preted as some suggest might introduce vast and costly uncertain-
ties into the simple, rational inherited system” 3 Such uncertainties
were due in part to the failure of the Conference to specify what
ingredients were to make up the “genuine link”, but, more im-
portantly, to the fact that the 1958 Convention leaves unspecified
such vital matters as who is to apply the requirements and what
sanctions would apply in the event of failure to conform. 44 Central
to the criticisms of Article 5 have been arguments that (i) the Com-
mission greatly exaggerated the degree of accord among nations on
the application of the genuine link principle and erred in its assump-
tion that the requirement of a nationality link between ship and
flag constituted customary international law45 and that (ii)
the
Commission over-extrapolated the Nottebohm decision”
in its at-
tempt to apply the ratio of that case (which dealt with the com-
petence of states to confer nationality on individuals) to the question
of the duties and obligations of states with respect to the nationality
of vessels.47
Opponents of the genuine link principle, not the least of whom
were representatives of the major flag of convenience states,48 found
some support for their criticisms of the Commission’s draft articles
and Article 5 of the Convention in the opinion of the International
Court of Justice in the IMCO dispute of 1960.’4 The dispute centered
on the interpretation to be given to Article 28 of the IMCO Conven-
tionr 0 which determined
the make-up of the important IMCO
43 McDougal, Burke and Vlasic, supra, note 33, 28.
44Ibid. See also, McDougal and Burke, The Public Order of the Oceans (1965),
1013; Boczek, supra, note 1, 284.
45Together with McDougal, Burke and Vlasic, supra, note 33, and McDougal
and Burke, supra, note 44, see Vinar, Effect of the “Genuine Link” Principle
of the 1958 Geneva Convention on the National Character of a Ship (1960) 35
N.Y.U.L.Rev. 1049, 1059.
46 [1955] I.CJ. 4.
47 To quote McDougal, Burke and Vlasic, supra, note 33, 39: “To derive from
applications of criteria of this type to the competence of states to confer
nationality upon individuals, principles assumed to be relevant to limiting the
competence of states to attribute nationality to ships is, if not an exercise in
irrelevancy, certainly a disguised mode of stating that because certain limits
have been imposed on states with respect to individuals for some problems,
other limits ought to be imposed with respect to ships for other problems.”
48See Boczek, supra, note 1, 256.
49 Constitution of the Maritime Safety Committee of the Inter-Governmental
50 289 U.N.T.S. 3.
Maritime Consultative Organization [1960], I.C.J. 150.
19781
FLAGS OF CONVENIENCE
Maritime Safety Committee on the basis of, inter alia, “those
nations having an important interest in maritime safety, of which
not less than eight shall be the largest shipowning nations” (em-
phasis added).51 States opposed to flag of convenience jurisdictions
took the position that the term “largest shipowning nations” was
not synonymous with the eight states with the greatest registered
tonnage.5 2 According to the Court, however, the foregoing phrase
should be interpreted in accordance with its ordinary meaning and,
as a consequence, those states with the largest registered tonnage
were eligible for election to the Committee in accordance with the
Convention.53 The implication of this decision could be, therefore,
that the test of registered tonnage is the only one by which the size
of a shipowning nation should be determined. Nevertheless, although
it has been claimed that the opinion could have general application,5 4
it is doubtful that it supports more than the literal interpretation of
Article 28(a) of the IMCO Convention.
Proponents of the genuine link theory have been of the view
that it provides a means of bringing order to an international situa-
tion which, based as it now is on the unrestricted freedom to re-
gister vessels, could ultimately lead to international conflict.
According to many of its defenders, the acceptability of the
genuine link should depend on its utility in protecting broader
community interests by bringing a measure of order, and protection,
to the uses of the seas. Speaking in his capacity as Expert to the
1958 Geneva Conference and as Rapporteur of the International
Law Commission, Professor Francois succinctly outlined the real
concern of the international community:
51 Art28(a) of the IMCO Convention reads as follows: “The Maritime Safety
Committee shall consist of fourteen Members elected by the Assembly from
the Members, governments of those nations having an important interest in
maritime safety, of which not less than eight shall be the largest ship-owning
nations, and the remainder shall be elected so as to ensure adequate repre-
sentation of Members, governments of other nations with an important in-
terest in maritime safety, such as nations interested in the supply of large
numbers of crews or in the carriage of large numbers of berthed and unberthed
passengers, and of major geographical areas.”
52 Supra, note 49, 166 et seq.
53 Ibid., 171:.”The Court having reached the conclusion that the determination
of the largest ship-owning nations depends solely upon the tonnage registered
in the countries in question, any further examination of the contention based
on a genuine link is irrelevant for the purpose of answering the question
which has been submitted to the Court for an advisory opinion.”
54 Boczek, supra, note 1, 155.
McGILL LAW JOURNAL
[Vol. 24
[A] system under which any state can grant its flag to all ships applying
for it is in fact the acme of freedom. That conception of freedom is, how-
ever, incompatible with the interests of the international community ….
If [the genuine] link no longer exists, the entire system collapses, and a
situation will arise on the high seas which some may regard as the ideal
state of freedom, but which others … regard as contrary to a sound
conception of the freedom of the seas and hence to the interests of the
international community.55
This point of view has been echoed by others who have also argued
in favour of a strong element of national ownership 0 Some have
argued that the transposition of the genuine link principle of the
Nottebohm case to the determination of the nationality of ships is
fully justified and that, while arguments can be offered on both
sides as to whether Article 5 of the Convention is lex lata, it is likely
that the International Court of Justice would sustain the applica-
tion of the link theory to the nationality of ships 7
The elements inherent in the genuine link requirement of Article
5 of the Convention are made more specific by the additional phrase
in paragraph 1 that “in particular, the state must effectively exercise
its jurisdiction and control in administrative, technical and social
matters over ships flying its flag”. The addition of this phrase has
been criticized, however, as importing no meaningful elaboration
of the link, and as offering additional undefined (and not necessarily
supplementary) criteria for ensuring national control of vessels.08
Whether or not this is the case, the inclusion of these requirements
in Article 5 (as with the proposals for Article 34 of the 1956 draft
articles) 59 is aimed at providing some measure of international
uniformity and control over the widespread dangers to maritime
safety which were perceived as resulting in part from the existence
of flag of convenience jurisdictions.”0 Both provisions should be
55 Quoted in Bowett, The Law of the Sea (1967), 150.
56 Watts, supra, note 34, although Watts’ position has been criticized, prin-
cipally because of his reliance on the Nottebohm case, supra, note 46. See
McDougal, Burke and Vlasic, supra, note 33, 37.
57 Jessup, The United Nations Conference on the Law of the Sea (1959) 59
Colum.L.Rev. 234, 256.
58 McDougal, Burke and Vlasic, supra, note 33, 28.
59 Now Art.10 of the 1958 Convention on the High Seas, 450 U.N.T.S. 82.
60 In its commentary, supra, note 41, 280, the Commission stated: “Regula-
tions concerning the construction, equipment and seaworthiness of ships, and
the labor conditions of crews, can contribute much to the safety of navigation.
Objections to the transfer of ships to another flag have often been accentuated
by the fact that such regulations, and an effective control over their application,
were lacking in the State of the new flag.”
19783
FLAGS OF CONVENIENCE
read together in analysing the present state of the law in this
regard. Article 10 of the Convention, based upon the International
Law Commission draft Article 34, provides:
1. Every State shall take such measures for ships under its flag as are
necessary to ensure safety at sea with regard inter alia to:
(a) The use of signals, the maintenance of communications and the
prevention of collisions;
(b) The manning of ships and labour conditions for crews taking into
account the applicable international labour instruments;
(c) The construction, equipment and seaworthiness of ships.
2. In taking such measures each State is required to conform to generally
accepted international standards and to take any steps which may be
necessary to ensure their observance.
The degree to which the genuine link principle in Article 5 and
the safety of navigation provisions in Article 10 have had the effect
of reducing the abuses which flag of convenience jurisdictions were
seen to represent is impossible to say. Neither Panama nor Liberia
are parties to the 1958 Convention. It is interesting, nevertheless,
that these two most important flag of convenience jurisdictions
supported the principle underlying Article 10 as not inconsistent
with their national objectives although, because of the effect that
the genuine link requirement in Article 5 would have had on
their economies by reducing vessel registrations, these same states
remained vehemently opposed to this concept. In addition, there is
some evidence that, having become party to other international
treaties, certain flag of convenience jurisdictions have passed le-
gislation intended to fulfil certain of the requirements of Article
10 of the Convention, although it is impossible to say whether those
states have satisfied the requirement that national laws conform
to “generally accepted international standards”, in accordance with
Article 10(2). Beyond the foregoing generalizations, it would appear
difficult to determine the effect of either the genuine link principle
or the maritime safety provisions of the Convention on the problem
of flags of convenience. Since neither Liberia nor Panama, inter alia,
have become parties to the Convention, there are no data on at-
tempts by third states to require application of the Convention by
these or other flag of convenience states.
Developments at the Third Law of the Sea Conference
The issues raised by recent maritime disasters involving flag of
convenience vessels are multi-dimensional. At stake is the broad
community interest in ensuring against uncontrolled registration
and the deployment of unseaworthy vessels with the attendant risk
McGILL LAW JOURNAL
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of marine pollution incidents. To a degree, the genuine link con-
cept was envisaged, by both its proponents and subsequent suppor-
ters, as one means of dealing with the problem, although the impetus
behind the adoption of the Nottebohm approach was as much
directed to ensuring a measure of state responsibility for acts done
by its vessels and to unifying divergent national laws regarding
vessel registration as it was to protect the marine environment.
As has been illustrated, opponents have claimed that the genuine
link principle, as applied to maritime law in Article 5 of the 1958
Convention, has no foundation in either international law or in
state practice. Additional arguments have been raised regarding its
inherent vagueness and ambiguity. Commercial interests, as well,
would militate against restricted use of foreign flag registrations
because of the manifold economic advantages normally offered by
flag of convenience jurisdictions. If it were universally binding,
Article 5 would inevitably restrict the utilization of these registries
by requiring, at the very least, some measure of corporate activity
in the state of registry, including possibly a degree of local particip-
ation in the ownership of the registering company. Whether of itself
corporate activity of sufficient degree to ensure a “link” with the
state of registry would improve vessel safety and help safeguard the
marine environment remains speculative. For this and for many of
the other reasons cited above, there are strong doubts as to the effi-
ciency of the genuine-link approach as the prime instrument in help-
ing to ensure the ultimate objective of protecting the world commu-
nity against the risks posed by unseaworthy vessels. Thus other ap-
proaches, taking into account both flag state obligations and coastal
state interests, must be considered in attempts to deal with this issue.
Strengthened flag state obligations are outlined in Article 10
of the 1958 Convention as well as, perhaps, the “in particular”
phrase in Article 5(1); both are directed toward ensuring the applic-
ation of local laws over vessels registered in a particular state with
respect to safety at sea.”‘ The support given at the 1958 Law of the
Sea Conference to the provisions of Article 10 by certain flag of
convenience states and the acceptance by these same states of
certain existing maritime conventions is some evidence, at least,
that there is no necessary inconsistency between opposition to a
strengthened link between vessel and state of registry and accept-
10 However, the requirement in Art.5(1) that “in particular, the State must
effectively exercise its jurisdiction and control in administrative, technical and
social matters over ships flying its flag” is not necessarily to require such
“jurisdiction and control” directed to ensuring safety at sea.
1978]
FLAGS OF CONVENIENCE
ance by the flag state of greater responsibilities
in regulating
matters pertaining to vessel design, construction, manning and
equipment. Apart from its lack of universal acceptance, the inherent
ambiguities in the genuine link requirement as a rule of law lead to
the conclusion that increased flag state obligations in the realm of
safety at sea may be a more efficacious way of dealing with modern
challenges regarding the use of the oceans and in particular mari-
time safety and environmental protection. The trend toward increas-
ed flag state obligations beyond those imposed under the 1958
Convention have been strongly evident at the recent sessions of
the Third United Nations Law of the Sea Conference.
The genuine link requirement has been included in Article 91
of the Informal Composite Negotiating Text (ICNT) 2 of July 15,
1977, which emerged from the recently concluded sixth session
of the Conference, held in New York from May 23 to July 15, 1977.
It is interesting to note that Article 91 is identical to Article 5 of
the 1958 Convention, except for the deletion of the last phrase
of paragraph (1) –
the “in particular…” phrase. The latter has
been inserted in Article 94, the ICNT equivalent of Article 10 of
the 1958 Convention.”3 Article 94,6 entitled Duties of the flag
States, provides for: (i) the duty of every flag state to exercise
“jurisdiction and control” over administrative, technical and social
matters; (ii) flag state obligations with respect to safety at sea –
an elaboration of the three categories of safety requirements con-
tained in Article 10 of the 1958 Convention; (iii) an element of
sanction by requiring the flag state to investigate and take appro-
priate action regarding any matter where it is claimed that such
“jurisdiction and control” has been lacking; and, significantly, (iv)
the requirement that the flag state investigate every marine casualty
or incident of navigation on the high seas causing loss of life or
serious injury or serious damage to the marine environment.
The objective of Article 94 is to elaborate the duties of the flag
state in comprehensive fashion with respect to overseeing the
62 A/CONF.62/W.P. 10, July 15, 1977.
63The relevant articles are set out in Appendix “A”, infra.
4 The origin of Art.94 is found in a series of draft provisions introduced at
6
the third session of the Conference by certain European states: A/CONF.62/
C.2/L.54, Aug. 17, 1974, contained in Third United Nations Conference on the
Law of the Sea, supra, note 20, vol.III, 229. As stated by France when in.
troducing the draft on behalf of itself, Belgium, Denmark, FGR, Ireland,
Italy, Luxembourg, Netherlands and the U.K., the object was to “state precisely
the obligations of the flag state since the relevant articles of the Geneva Con-
vention (i.e., Articles 5 and 10) were incomplete”.
McGILL LAW JOURNAL
[Vol. 24
management of its vessels. To the extent that the obligations elabor-
ated in Article 94 are opposable to flag states in the event of a
binding treaty, they may offer a more practical means of protecting
the marine environment and ensuring safety at sea than an attempt
to spell out more precisely the ingredients of the genuine link. Yet
in the views of some, over-emphasis of flag state jurisdiction
in the ICNT is not the only or the most effective method of
dealing with flags of convenience jurisdictions and the dangers
that certain of their vessels pose to the international community.
international
Apart from the duties of the flag state in Article 94 with respect
to maritime safety and administrative, technical and social matters
over ships flying its flag, Article 21863 of the ICNT places additional
enforcement obligations on the flag state to ensure “compliance
rules and standards established
with applicable
through the competent international organization or general diplom-
atic conference” in controlling pollution of the marine environ-
ment. Vessels which do not comply with such rules and standards
may be prevented by the flag state from sailing or may be subject
to criminal or civil proceedings initiated by the flag state. Article
21266 requires flag states to pass national laws to prevent marine
pollution which “shall at least have the same effect as that of
international rules and standards”. However
generally accepted
uncertain the phrase “generally accepted international rules and
standards” may appear to be, it would at least seem to import
obligations pursuant to the general duties of flag states regarding
administrative, technical and social matters as well as safety at
sea under Article 94 of the ICNT. The phrase would also import
more specific flag state obligations than the general ones set out in
Article 94, contingent on the ability of international organizations
such as IMCO to agree on applicable rules and standards aimed at
ensuring seaworthy vessels.
The efforts to establish meaningful flag state obligations in this
regard and to improve upon the more generally-drafted provisions
in the 1958 Convention are commendable. The limitations of this
approach as the only solution to the flag of convenience problem,
however, are all too evident. For example, the requirement under
Article 212 that the laws of flag states “shall at least have the same
rules and
effect” as that of “generally accepted
standards established through the competent international organiz-
ation or general diplomatic conference” and the corresponding
international
15 See Appendix “A”, infra.
66 Ibid.
19781
FLAGS OF CONVENIENCE
obligation to enforce such laws under Article 218 raise serious
problems of interpretation. What does the phrase “generally accept-
ed international rules and standards” mean? If “generally accept-
ed” means, as some contend, rules set down under a treaty which
is in force, the present effect would be to require, for example, flag
states to pass laws giving effect to the provisions in the Inter-
national Convention for the Prevention of Pollution of the Sea by
Oil, 1954,.7 which is in force; however, similar action would not
be required with respect to the International Convention for the
Prevention of Pollution from Ships, 1973, because
the latter,
which sets higher environmental protection standards and is to
supersede the 1954 Convention, is not yet in force. Thus, the absence
of internationally accepted standards enshrined in an international
treaty currently in force limit the obligations of the flag state and
thus reduce the efficacy of the concept of the flag state juris-
diction as embodied in the ICNT. Furthermore, there is a problem
with respect to international rules or standards regarding vessel-
source pollution embodied in treaties which may be in force but
to which a particular flag state is not a party. In such a case, do
the obligations contained in Articles 212 and 218 apply? The answer
is not clear. Moreover, to preserve their freedom of action, flag
states may not wish to become parties to a comprehensive law of
the sea treaty that could potentially impose on them precise inter-
national obligations to enact domestic legislation which might not
be in their interests.
The series of recent oil spills involving flag of convenience oil
tankers and the risks which such disasters pose to the environment
of coastal states have helped to illustrate the extent to which such
incidents affect community interests. Given the extent of coastal
state and flag state interests, it would seem to follow that the de-
velopment of international law should provide recognition of the
interrelationship between these competing, but not necessarily irre-
concilable, concerns. Thus, ideally, any new law of the-sea treaty
should ensure a balance between the rights and obligations of the
flag state with respect to the registration, internal management and
regulation of its vessels consistent with the principle of freedom of
the high seas, and those of the coastal state with respect to the pre-
servation of its coastal environment, including, under appropriate
circumstances, the right to take specific action regarding vessels
in its territorial sea or perhaps beyond 6 8 However, while the posi-
67327 U.N.T.S. 3.
08 Legault, The Freedom of the Seas: A Licence to Pollute? (1971) 21 U.of
T.LJ. 210, 218.
McGILL LAW JOURNAL
[Vol. 24
tion of flag states as prime instruments in enforcing pollution
prevention and maritime safety standards has been reflected in the
ICNT, even to the extent, as in Article 94, of requiring national laws
in the absence of generally accepted rules or standards, the rights
of coastal states in protecting the coastal environment seem to have
been given less prominence. This limitation arises in part because
although coastal states can establish national laws for the preven-
tion, reduction and control of marine pollution from vessels under
appropriate provisions in the draft treaty, such laws must not
hamper innocent passage of foreign vessels in the territorial sea,
in accordance with Article 212(3). Article 212(3) is cross-referenced
to Part II of the ICNT and under Article 21 of Part II, which sets
out the permissible scope of laws and regulations of the coastal
state relating to innocent passage, coastal states are not empowered
to pass laws regulating design, construction, manning and equip-
ment standards of foreign vessels unless they give effect to “ge-
nerally accepted rules or standards”, a limitation which restricts
coastal states even beyond their implicit powers under the 1958
Convention on the Territorial Sea and Contiguous Zone 9 The latter
provides in Article 1 that “the sovereignty of a state extends beyond
its land territory and its internal waters to a belt of sea adjacent
to its coast, described as the territorial sea”. 70 Thus, under the ICNT,
coastal states may establish national laws regulating vessel traffic
in their territorial sea, including the right to inspect and, if ne-
cessary, arrest vessels. 1 They are, however, limited to adopting
laws that incorporate only “generally accepted” rules or standards
in the territorial sea regarding design, construction, manning and
equipment of foreign vessels, elements which are key components
09 U.N.Doc.A/CONF.13/L.52, Apr. 28, 1958.
70 Art.14 of the 1958 Convention defines innocent passage
through the
territorial sea as passage “not prejudicial
to the peace, good order or
security of the coastal state” and requires such passage to be in accordance
with the Convention “and with other rules of international law”. While it has
not been settled as to whether “peace, good order or security” include serious
threats to the environment, the powers of the coastal state in requiring
national standards respecting design, construction, manning and equipment
to be complied with by vessels sailing through its territorial sea as a basis
for maintaining its “peace, good order or security” has not been specifically
foreclosed by the 1958 Convention, as it has in Art.21 of the ICNT. See supra,
note 19. Article 17 of the 1958 Convention also requires foreign ships to “comply
with the laws and regulations enacted by the coastal state in conformity with
these articles and other rules of international law, and in particular, with such
laws and regulations relating to transport and navigation” (emphasis added).
-1 ICNT, art.221(2).
19781
FLAGS OF CONVENIENCE
in laws designed to deal with vessel-source pollution. Within the
200-mile exclusive economic zone,72 coastal states are clothed with
even less power; under the ICNT a coastal state can only pass laws
“giving effect”
to “generally accepted international rules and
standards”.7 3 It follows that coastal states are not empowered to set
national standards in the territorial sea (respecting vessel design,
construction, manning or equipment) or in the 200-mile exclusive
economic zone (regarding the prevention, reduction and control
of pollution from vessels)
in the absence of generally accepted
international rules and standards which, in turn, must be first
established through the competent international organization or
general diplomatic conference.
Enforcement powers of coastal states, as distinct from law-
making powers, appear equally circumscribed under Article 221 of
the ICNT.74 Proceedings against vessels voluntarily within a port
or at an offshore terminal of a state may be instituted with respect
to pollution incidents occurring either in the territorial sea or exclu-
sive economic zone of that state, but only to the extent that such
vessel has violated national laws or applicable international stand-
ards. Such “national laws” as has been pointed out above, cannot
hamper innocent passage in the territorial sea and, with respect to
the exclusive economic zone, coastal states can only pass pollution
control legislation “conforming to and giving effect to generally
accepted international rules and standards established through the
competent international organization or general diplomatic con-
ference”. With respect to a vessel not within a port or at an offshore
terminal, the coastal state may undertake physical inspections and,
may in certain cases arrest and take proceedings against polluting
vessels –
subject to relevant provisions respecting expediting pro-
ceedings and the prompt release of vessels and provided that
innocent passage through the territorial sea has not been hampered
and also that, with respect to violations in the exclusive economic
zone, the violation has been in respect of applicable international
72ICNT, Art.55, defines the exclusive economic zone as “an area beyond and
adjacent to the territorial sea subject to the specific legal regime established
in this Part, under which the rights and jurisdictions of the coastal state and
the rights and freedoms of other states are governed by the relevant provisions
of the present Convention”.
73 ICNT, Art.212(4).
U4See Appendix “A”, infra.
McGILL LAW JOURNAL
[Vol. 24
rules or standards. Again, the limitations on coastal states in the
absence of “generally accepted” international rules are obvious. 5
On the assumption that coastal state regulation provides an
effective means of ensuring against pollution incidents resulting
from the use of unseaworthy or improperly manned vessels, the
limitations in the new law of the sea treaty could prove to be
unfortunate restraints where “generally accepted international rules
or standards” are either inadequate or non-existent. Moreover,
even strengthened control of flag states under the ICNT provisions
(or under an eventual treaty) is prejudiced by the existence and
continuing growth of flag of convenience jurisdictions which have
neither the power nor the administrative machinery to impose
national or international regulations nor indeed the desire to control
the registering companies themselves. 0 Thus, while extending flag
state powers and obligations under an international treaty is one
method of providing a measure of safeguard against the risks entail-
ed in present day flag of convenience registration practice, given
the limitations in the foregoing approach, a second, and perhaps
more effective though complementary approach, would be to extend
coastal state jurisdiction and to remove the present limitations in
the ICNT respecting coastal state legislative competence to establish
standards in the territorial sea and coastal state enforcement powers
in the economic zone.7
7 If this latter approach were combined with
75 An additional problem area in the ICNT is the provision contained in
Art.229 with respect to suspension of proceedings by the coastal state if within
6 months of commencement of those proceedings, the flag state has itself
instituted similar proceedings- to impose penalties. This provision for flag
state pre-emption has been of concern to coastal states like Canada since it
could have the effect of rendering coastal state powers illusory. Art.229 does
provide, however, that flag state pre-emption cannot occur where the pro-
ceedings “relate to a case of major damage to the coastal state or the flag
state in question has repeatedly disregarded its obligations to enforce effective-
ly the applicable international rules and standards in respect of violations com-
mitted by its vessels”.
76Lowe, The Enforcement of Marine Pollution Regulations (1975) 12 San
7 Additionally, it is important to note that apart from the port enforcement
powers accorded coastal states under Art.221 of the ICNT in respect of its
own territorial sea and economic zone as discussed in the text, supra, p.21,
Art. 229 accords the coastal state powers of port enforcement with respect to
certain types of violations occurring within the territorial sea or exclusive
economic zone of another state or on the high seas, when, for example, the
violation is likely to cause pollution to that coastal state. This attempt to
“universalize” port state enforcement is another avenue to solving marine
pollution dangers brought about by sub-standard vessels including those flying
flags of convenience.
Diego Rev. 624, 633.
19781
FLAGS OF CONVENIENCE
effective dispute settlement provisions in the law of the sea treaty,
the result would not automatically lead to a diminution of the
freedom of the high seas principle or be prejudicial to the un-
restricted movement of ocean-borne commerce due to a plethora
of divergent national regulations. On the contrary, such an approach
could ensure that some measure of control and an element of
sanction is brought to bear on expanding flag of convenience fleets,
whioh, in themselves, are inimical to the maintenance of the high
seas as res communis in the truest sense.
APPENDIX “A”
ARTICLE 91
Nationality of ships
1. Each State shall fix the conditions for the grant of its nationality to ships,
for the registration of ships in its territory, and for the right to fly its flag.
Ships have the nationality of the State whose flag they are entitled to fly.
There must exist a genuine link between the State and the ship.
2. Each State shall issue to ships to which it has granted the right to fly its
flag documents to that effect.
ARTICLE 94
Duties of the flag States
1. Every State shall effectively exercise its jurisdiction and control in ad-
ministrative, technical and social matters over ships flying its flag.
2. In particular every State shall:
(a) Maintain a register of shipping containing the names and particulars
of ships flying its flag, except those which are excluded from generally
accepted international regulations on account of their small size; and
(b) Assume jurisdiction under its internal law over each ship flying its
flag and its master, officers and crew in respect of administrative,
technical and social matters concerning the ship.
3. Every State shall take such measures for ships flying its flag as are
necessary to ensure safety at sea with regard, inter alia, to:
(a) The construction, equipment and seaworthiness of ships;
(b) The manning of ships, labour conditions and the training of crews,
taking into account the applicable international instrumentsI
(c) The use of signals, the maintenance of communications and the pre-
vention of collisions.
4. Such measures shall include those necessary to ensure:
(a) That each ship, before registration and thereafter at appropriate
intervals, is surveyed by a qualified surveyor of ships, and has on
board such charts, nautical publications and navigational equip-
ment and instruments as are appropriate for the safe navigation
of the ship;
(b) That each ship is in the charge of a master and officers who possess
appropriate qualifications, in particular in seamanship, navigation,
McGILL LAW JOURNAL
[Vol. 24
is
communications, and marine engineering, and
appropriate in qualification and numbers for the type, size, machine-
ry and equipment of the ship;
that the crew
(c) That the master, officers and, to the extent appropriate, the crew
to observe the applicable
are fully conversant with and required
international regulations concerning the safety of life at sea, the
prevention of collisions, the prevention, reduction and control of
marine pollution, and the maintenance of communications by radio.
5. In taking the measures called for in paragraphs 3 and 4 each State is
international regulations,
required
procedures and practices and to take any steps which may be necessary
to secure their observance.
to generally accepted
to conform
6. A State which has clear grounds to believe that proper jurisdiction and
control with respect to a ship have not been exercised may report the
facts to the flag State. Upon receiving such a report, the flag State
shall investigate the matter and, if appropriate, take any action necessary
to remedy the situation.
7. Each State shall cause an inquiry to be held by or before suitably
qualified person or persons into every marine casualty or incident of
navigation on the high seas involving a ship flying its flag and causing
loss of life or serious injury to nationals of another State or serious
damage to shipping or installations of another State or to the marine
environment. The flag State and the other State shall co-operate in the
conduct of any inquiry held by that other State into any such marine
casualty or incident of navigation.
ARTICLE 212
Pollution from vessels
1. States, acting through the competent international organization or general
diplomatic conference, shall establish international rules and standards
for the prevention, reduction and control of pollution of the marine en-
vironment from vessels. Such rules and standards shall, in the same
manner, be re-examined from time to time as necessary.
2. States shall establish laws and regulations for the prevention, reduction
and control of pollution of the marine environment from vessels flying
their flag or vessels of their registry. Such laws and regulations shall at
least have the same effect as that of generally accepted international rules
and standards established through the competent international organiz-
ation or general diplomatic conference.
3. Coastal States may, in the exercise of their sovereignty within their terri-
torial sea, establish national laws and regulations for the prevention, re-
duction and control of marine pollution from vessels. Such laws and re-
gulations shall, in accordance with section 3 of Part II not hamper inno-
cent passage of foreign vessels.
4. Coastal States, for the purpose of enforcement as provided for in section
6 of this Part of the present Convention, may in respect of their economic
zones establish laws and regulations for the prevention, reduction and
control of pollution from vessels conforming to and giving effect to
generally accepted international rules and standards established through
the competent international organization or general diplomatic conference.
1978]
FLAGS OF CONVENIENCE
5. Where international rules and standards referred to in paragraph 1 are
inadequate to meet special circumstances and where coastal States have
reasonable grounds for believing that a particular, clearly defined area
of their respective exclusive economic zones is an area where, for rew-
cognized technical reasons in relation to its oceanographical and ecological
conditions, as well as its utilization or [sic] the protection of its resources,
and the particular character of its traffic, the adoption of special mandatory
methods for the prevention of pollution from vessels is required, coastal
States, after appropriate consultations through the competent international
organization with any other countries concerned, may for that area, direct
a communication to the competent international organization, submitting
scientific and technical evidence in support, and information on necessary
reception facilities. The organization shall, within twelve months after
receiving such a communication, determine whether the conditions in that
area correspond to the requirements set out above. If the organization so
determines, the coastal State may, for that area, establish laws and re-
gulations for the prevention, reduction and control of pollution from
vessels, implementing such international rules and standards or navigational
practices as are made applicable through the competent international organ-
ization for special areas. Coastal States shall publish the limits of any such
particular, clearly defined area, and laws and regulations applicable there-
in shall not become applicable in relation to foreign vessels until fifteen
months after the submission of the communication to the competent in-
ternational organization. Coastal States, when submitting the communic-
ation for the establishment of a special area within their respective ex-
clusive economic zones, shall at the same time, notify the competent in-
ternational organization if it is their intention to establish additional laws
and regulations for that special area for the prevention, reduction and
control of pollution from vessels. Such additional laws and regulations
may relate to discharges or navigational practices but shall not require
foreign vessels to observe design, construction, manning or equipment
standards other than generally accepted international rules and standards
and shall become applicable in relation to foreign vessels 15 months after
the submission of the communication to the competent international or-
ganization, and provided the organization agrees within twelve months
after submission of the communication.
ARTICLE 218
Enforcement by flag States
1. States shall ensure compliance with applicable international rules and
standards established through the competent international organization
or general diplomatic conference and with their laws and regulations
established in accordance with the present Convention for the prevention,
reduction and control of pollution of the marine environment, by vessels
flying their flag or vessels of their registry and shall adopt the necessary
legislative, administrative and other measures for their implementation.
Flag States shall provide for the effective enforcement of such rules,
standards, laws and regulations, irrespective of where the violation oc-
curred.
2. Flag States shall, in particular, establish appropriate measures in order
to ensure that vessels flying their flags or vessels of their registry are
McGILL LAW JOURNAL
[Vol. 24
prohibited from sailing, until they can proceed to sea in compliance with
the requirements of international rules and standards referred to in para-
graph 1 for the prevention, reduction and control of pollution from vessels,
including the requirements in respect of design, construction, equipment
and manning of vessels.
3. States shall ensure that vessels flying their flags or of their registry carry
on board certificates required by and issued pursuant to international
rules and standards referred to in paragraph 1. Flag States shall ensure
that their vessels are periodically inspected in order to verify that such
certificates are in conformity with the actual condition of the vessels. These
certificates shall be accepted by other States as evidence of the condition
of the vessel and regarded as having the same force as certificates issued
by them, unless there are clear grounds for believing that the con-
dition of the vessel does not correspond substantially with the particulars
of the certificates.
4. If a vessel commits a violation of rules and standards established through
the competent international organization or general diplomatic conference,
the flag State, without prejudice to articles 28, 30 and 38 shall provide for
immediate investigation and where appropriate cause proceedings to be
taken in respect of the alleged violation irrespective of where the violation
occurred or where the pollution caused by such violation has occurred
of [sic] has been spotted.
5. Flag States may seek in conducting investigation of the violation the
assistance of any other State whose co-operation could be useful in
clarifying the circumstances of the case. States shall endeavour to meet the
appropriate request of flag States.
6. Flag States shall, at the written request of any State, investigate any
violation alleged to have been committed by their vessels. If satisfied that
sufficient evidence is available to enable proceedings to be brought in
respect of the alleged violation, flag States shall without delay cause such
proceedings to be taken in accordance with their laws.
7. Flag States shall promptly inform the requesting State and the competent
international organization of the action taken and its outcome. Such in-
formation shall be available to all States.
8. Penalties specified under the legislation of flag States for their own
vessels shall be adequate in severity to discourage violations wherever the
violations occur.
ARTICLE 221
Enforcement by coastal States
1. When a vessel is voluntarily within a port or at an off-shore terminal of
a State, that State may, subject to the provisions of section 7 of this Part
of the Convention cause proceedings to be taken in respect of any violation
of national laws and regulations established in accordance with the present
Convention or applicable international rules and standards for the preven-
tion, reduction and control of pollution from vessels when the violation
has occurred within the territorial sea or the exclusive economic zone
of that State;
2. Where there are clear grounds for believing that a vessel navigating in
the territorial sea of a State has, during its passage therein, violated
1978]
FLAGS OF CONVENIENCE
national laws and regulations established in accordance with the present
Convention or applicable international rules and standards for the pre-
vention, reduction and control of pollution from vessels, that State, with-
out prejudice to the. application of the relevant provisions of section 3 of
Part II may undertake physical inspection of the vessel relating to the
violation and may, when warranted by the evidence of the case, cause
proceedings, including arrest of the vessel, to be taken in accordance with
its laws, subject to the provisions of section 7 of this Part of the present
Convention.
3. Where there are clear grounds for believing that a vessel navigating in the
exclusive economic zone or the territorial sea of a State has, in the ex-
clusive economic zone, violated applicable international rules and standards
or national laws and regulations conforming and giving effect to such
the prevention, reduction and
international
control of pollution from vessels, that State may require the vessel to
give information regarding the identification of the vessel and its port of
registry, its last and next port of call and other relevant information
required to establish whether a violation has occurred.
rules and standards for
4. Flag States shall take legislative, administrative and other measures so
that their vessels comply with requests for information as set forth in
paragraph 3.
5. Where there are clear grounds for believing that a vessel navigating in
the exclusive economic zone or the territorial sea of a State has, in the
international rules and
exclusive economic zone, violated applicable
standards or national laws and regulations conforming and giving effect
to such international rules and standards for the prevention, reduction
and control of pollution from vessels and the violation has resulted in a
substantial discharge into and, insignificant pollution of, the marine en-
vironment, that State may undertake physical inspection of the vessel for
matters relating to the violation if the vessel has refused to give in-
formation or if the information supplied by the vessel is manifestly at
variance with the evident factual situation and if the circumstances of
the case justify such inspection.
6. Where there are clear grounds for believing that a vessel navigating in
the exclusive economic zone or the territorial sea of a State has, in the
exclusive economic zone, committed a flagrant or gross violation of
applicable international rules and standards or national laws and regula-
tions conforming and giving effect to such international rules and stan-
dards for the prevention, reduction and control of pollution from vessels,
resulting in discharge causing major damage or threat of major damage
to the coastline or related interests of the coastal State, or to any re-
sources of its territorial sea or exclusive economic zone, that State may,
subject to the provisions of Section 7 of this Part of the Convention
provided that the evidence so warrants, cause proceedings to be taken
in accordance with its laws.
7. Notwithstanding the provisions of paragraph 6, whenever appropriate
procedures have been established either through the competent interna-
tional organization or as otherwise agreed, whereby compliance with
requirements for bonding or other appropriate financial security has been
assured, the coastal State if bound by such procedures shall allow the
vessel to proceed.
McGILL LAW JOURNAL
[Vol. 24
8. The provisions of paragraphs 3, 4, 5, 6 and 7 shall apply correspondingly
to
laws and regulations established pursuant
in respect of national
paragraph 5 of article 212.
ARTICLE 229
Suspension and restrictions on institution of proceedings
1. Proceedings to impose penalties in respect of any violation of applicable
laws and regulations or international rules and standards relating to the
prevention, reduction and control of pollution from vessels committed by
a foreign vessel beyond the territorial sea of the State instituting pro-
ceedings shall be suspended upon the taking of proceedings to impose
penalties under corresponding charges by the flag State within six months
of the first institution of proceedings,, unless those proceedings relate
to a case of major damage to the coastal State or the flag State in question
has repeatedly disregarded its obligations to enforce effectively the applic-
able international rules and standards in respect of violations committed
by its vessels. The flag State shall in due course make available to the
first State instituting proceedings a full dossier of the case and the
records of the proceedings, whenever the flag State has requested the
suspension of proceedings in accordance with the provisions of this Article.
-When proceedings by the flag State have been brought to a conclusion,
the suspended proceedings shall be finally terminated. Upon payment of
costs incurred in respect of such proceedings, any bond posted or other
financial security provided in connexion with the suspended proceedings
shall be released by the coastal State.
2. Proceedings to impose penalties on foreign vessels shall not be instituted
after the expiry of a period of three years from the date on which the
violation was committed, and shall not be taken by any State in the event
of proceedings having been instituted by another State subject to the
provisions set out in paragraph 1.
3. The provisions of this article shall be without prejudice to the right of
the flag State to adopt any measures, including the taking of proceedings
to impose penalties, according to its laws irrespective of prior proceedings
by another State.
Interpretation et application des r!gles de conflit
de lois en droit qudb~cois
E. Groffier*
paragraphes
I. Introduction …………………………………………………………………………………………..
II. Interpretation de la rigle de conflit …………………………………………………
A. Qualification
…………………………………………………………………………………
1. Instabilit6 de la qualification ……………………………………………….
a) Preuve ……………………………………………………………………………….
…………………………………………………………………..
b) Prescription
c) Clause d’arbitrage …………………………………………………………..
d) Restrictions hi la capacit6 des 6poux ……………
e) Testament conjoint ……………………………………………………….
2. Conflit de qualifications ………………………………………………………..
B. Renvoi
…………………………………………………………………………………………..
C. Question pr6alable ……………………………………………………………………..
D. Droit transitoire ………………………………………………………………………..
E. Conflit mobile ……………………………………………………………………………..
III. Application de la r~gle de conflit ……………………………………………………
A. Preuve de la loi 6trang~re ………………………………………………………..
1
4
5
9
10
12
14
16
18
19
27
33
37
41
46
47
48
51
1. Fardeau de la preuve …………………………………………………………
2. Modes de preuve …………………………………………………………………
B. Fraude h la loi ……………………………………………………………………………..
C. Ordre public ……………………………………………………………………………….
IV. Conclusion
…………………………………………………………………………………………..
58
67
75
* D.c.l., professeur associd h la facult6 de droit de McGill University.
McGILL LAW JOURNAL
[Vol. 24
I.
INTRODUCTION
1 – Le droit international priv6 qudbdcois, tout comme le droit civil,
tire son origine de l’ancien droit frangais. Les r~gles de conflit de lois
ont 6t6 succinctement codifides dans les articles 6 h 8 C.c. qui s’inspi-
rent de l’article 3 du Code Napoldon. Celui-ci prdvoit que:
Les lois de police et de sfiretd obligent tous ceux qui habitent le territoire.
Les immeubles, meme ceux poss~ds par des 6trangers, sont regis par ]a
loi frangaise. Les lois concernant
‘dtat et la capacitd des personnes rdgis-
sent les Frangais, m6me rdsidant en pays dtranger.
Les Codificateurs’ en ont retir6 les lois de police et de sciret6
qui appartiennent h la compdtence f6d6rale et ont combld les lacunes
quant aux meubles et h l’6tat et h la capacit6 de l’6tranger. De plus,
ils ont ajout6 une r gle concernant la forme des actes, reproduisant
la maxime locus regit actum, h l’exemple du Code civil de Louisia-
ne2 ainsi qu’une autre concernant la loi r6gissant les contrats. Ces
dispositions et d’autres peu nombreuses, 6parpilldes dans le Code
civil,3 correspondent plus ou moins h celles du droit international pri-
v6 frangais de l’6poque.4 I1 faut noter, toutefois, une diffdrence fon-
damentale dans le facteur de rattachement du statut personnel, le do-
micile, qui convient mieux que celui de la nationalit6 au syst~me
juridique d’une unit6 territoriale comprise dans un Etat fdd6ral.
2 – La jurisprudence a fait dvoluer ces quelques principes, tout
comme en France mais pas toujours dans le m~me sens. Certaines
divergences marquantes sont a signaler. Elles sont dues h un en-
semble de facteurs tels que les diffdrences dans les textes de base,
l’existence d’une division des comptences l6gislatives entre les pou-
voirs f6d6ral et provincial au Canada5 et, surtout, l’influence du
syst~me de la common law en vigueur dans les autres provinces du
Canada. On peut citer, h titre d’exemples de cette derni~re, l’appli-
cation automatique de la loi du for au divorce international’ et
1 Deuxi~me Rapport des Commissaires chargds de codifier les lois du Bas-
Canada en matireY civiles (1865), aux pp.144, 242 et ss., arts.7 6t 7b.
2 Art.10, al. 1: “The form and effect of public and private written instru-
ments are governed by the laws and usages of the places where they are
passed or executed.”
3 Notamment, arts.135 et 348a C.c.
4 Les Codificateurs citent ht plusieurs reprises l’ouvrage de Foelix, Traitd
du droit international privg ou du conflit des lois de diffdrentes nations 3e
dd., par Demangeat (1856).
5 Voir Acte de l’Amdrique du Nord Britannique, 30-31 Vict., c.3, arts.91 et 92
(U.K.) (S.R.C. 1970, Appendice II, no 5, h la p.191).
0 Voir Mendes da Costa, “Divorce and the Conflict of Laws”, dans Studies
in Canadian Family Law (1972), t2, 899, t la p.966; Castel, Canadian Conflict
