UK tonnage tax has increased UK fleet

Her Majesty's Revenue & Customs (HMRC) is understood to have agreed to re-examine its intention to unilaterally reinterpret the UK Tonnage Tax rules to the potential detriment of many shipowners. Shipping accountant and adviser, Moore Stephens says it understands that the review will be carried out in consultation with the shipping industry.

Widely disputed changes based on unspecified 'legal advice' were set out in HMRC's tonnage tax manual in September 2009. These focused in particular on a reinterpretation of the strategic and commercial management tests that are fundamental to qualification for the tonnage tax regime.

UK tonnage tax is widely credited with having helped increase the UK fleet substantially since its introduction in 2000, when it was regarded as a model of clarity and stability. Then, as now, there was the need for a stable UK tax regime to both support British business and to encourage international businesses to operate and stay in the UK. Under the reinterpretation of the rules, some groups would not have qualified for the UK regime, despite having previously received HMRC clearance, with the result that internationally mobile shipping groups could consider leaving the UK.

Sue Bill, a tax partner with Moore Stephens, says: "HMRC's reinterpretation of the rules created a lack of certainty and sent completely the wrong signals to international shipowners who had relocated to the UK to take advantage of its tonnage tax regime. It would therefore be excellent news if, as we understand to be the case, HMRC decides to consider the matter afresh, and to consult fully with the shipping industry. This would be seen as an indication that the government means to continue to act fairly and reasonably, not least by protecting shipowners who elected into the regime for a ten-year period based on the original HMRC rules and clearances."

She added: "While no formal change to HMRC's position has yet been confirmed, it is understood that any changes to the rules will now be assessed carefully. HMRC has warned that this re-examination may not result in any change in its position at all. But we are hopeful that HMRC and the UK government will let us have a more considered view. We have been working with the industry, and in particular the Chamber of Shipping, in campaigning for some time, and we are delighted at this positive development."

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While most other national shipping associations have indicated preference for a levy if market based measures are introduced to drive a reduction of its carbon emissions, the UK Chamber of Shipping has urged the international shipping industry to keep the door open on all options.

The Chamber has however shifted its ground from its position adopted in 2009 when it issued a statement headlined "Shipping industry supports emissions trading to reduce CO2". Now it has launched two "manuals" on the two main options. It says that this is the first time an attempt has been made to set out the practical implications for the shipping industry. The manual supporting an ETS has been written by BP Shipping while the one promoting a levy has been prepared by AP Moller Maersk.

The Chamber has welcomed the advances made by the IMO to promote the reduction of shipping's carbon emissions through technical efficiencies but in a statement says it believes that it will prove necessary for the industry to go further - through the adoption of economic (or 'market-based') measures to meet governments' expectations and targets.

The statement said: "International opinion is divided on the best model for reducing the shipping industry's carbon emissions. Some support the idea of a greenhouse gas (GHG) contribution fund, in which shipping companies would contribute as part of purchases of bunker fuel. Others prefer an Emissions Trading System (ETS), in which shipping companies would buy a shipping allowance or 'emissions unit', which they would then surrender according to their actual carbon emissions."

The International Chamber of Shipping's (ICS) director of external relations Simon Bennett told London Matters that the vast majority of national shipping associations within ICS supported the policy adopted by the organisation in May this year that its preferred option would be some form of levy.

London Matters understands that, within ICS, the UK Chamber was the only national shipping association representing a significant amount of tonnage that did not support the preference for a levy.

Mark Brownrigg, Director General of the British Chamber of Shipping said: "This is a complex international debate for which we need active participation from the shipping industry and governments to find a genuine solution. This must be global - through the IMO - rather than regional."

He added: "It is crucial that we do not discount either of the main proposed economic mechanisms for encouraging carbon reductions. The debate lies ahead on which option will provide greater certainty of outcome, ease of application, and without damaging the growth of the industry and world trade. That debate must be based on practical considerations rather than conjecture."

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UK shipping law and insurance firms have out-performed the UK top 50 with revenues and profits per equity partner (PEP) growing by an average of 10.3%

Shipping lawyers and insurers are star performers

The companies in this group include Clyde & Co, Barlow Lyde & Gilbert, Holman Fenwick Willan, Kennedys, Watson Farley & Williams, Ince & Co and Berrymans Lace Mawer. All of these firms enjoyed an increase in revenue with exception of

Ince whose revenues remained static. The largest firm in this group, Clyde & Co, reported revenues of £212m which was almost double that of its nearest rival, Holman Fenwick Willan at £112.5m. The firm enjoying the biggest improvement last financial year was Barlow Lyde & Gilbert

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International Union of Marine Insurance (IUMI) is to debate the "curse of piracy and its vicious implications in human terms, as well as its impact on world trade through disrupting cargoes and the financial losses inflicted on shipowners and insurers", in Paris next month when marine insurers from around the world gather for their annual forum.

More than 500 marine underwriters, and senior representatives from many international maritime organisations, are expected to attend the event.

IUMI notes that although there has been a lull in Somali pirate operations because of the monsoon, the past few weeks have seen a worrying upsurge in attacks off West Africa, with a number of vessels successfully hijacked. It has been reported there are now 21 countries, in part or in whole, which are affected by piracy.

IUMI's executive committee and its seven technical committees will meet on Sunday, 18 September, and there will be an opening reception hosted by the French market in the evening. A packed programme of presentations, workshops and panel discussions will take up the next three days. The 2011 conference title is 'The Evolution of Risk, Safety and Security', and many of the topics will be harnessed to this theme.

On the opening Monday morning the industry keynote speaker will be Bernard Anne, executive vice president and managing director of Bureau Veritas Marine Division, the French classification society. Denis Kessler, chief executive of SCOR, the French reinsurer, will also give a keynote presentation.

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A senior official in seafarers' union Nautilus International, Assistant General Secretary Paul Moloney, was summarily dismissed for alleged gross misconduct last month, it has emerged. A Nautilus spokesman declined to comment on the matter as did Mr Moloney.

London Matters understands that Mr Moloney can now appeal to Nautilus's governing Council at its next meeting in early October.

Mr Moloney's dismissal is believed to have come days after Nautilus's executive committee had endorsed a paper he had written that advocated continuing the current policy of expanding by seeking suitable partners who must themselves be maritime unions.

In a report at the time, London Matters noted that the paper endorsed what had been Nautilus policy for a number of years and was significant as it came as some other UK transport unions were considering linking up. The Transport Salaried Staffs' Association, in particular, is keen to work with other transport sector unions but the executive committee's endorsement would appear to make it unlikely that it will be in any merger discussions with UK-based unions.

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Trevor Harrison has been appointed as acting chief executive of the International Bunker Industry Association (IBIA). The move follows the recent resignation of Ian Adams, the former chief executive.

Trevor Harrison is a member of the IBIA Board, a barrister of more than 30 years' standing and author of the just published book, Legal Issues in Bunkering. He is undertaking the new role on a part-time basis in addition to his principal activities as a maritime arbitrator and commercial mediator.

IBIA Chairman Bob Lintott said: "In his capacity as an IBIA Board Member and before that as an Association member, Trevor has worked closely with the Secretariat on many different matters over the past few years. With his unequalled knowledge of IBIA's global objectives and internal functions, he is an excellent short-term fit for the role of Chief Executive and we are very grateful for his support and assistance at this time."

He added: "It is very much business as usual at IBIA and we look forward to seeing our members and the wider industry at our Barcelona Convention, starting on 2 November and at our Golf and Gala Dinner in Singapore on 2 September."

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New Maritime London member, Grey Page has recently published a "think-tank" paper on the complexities involved in how shipowners can safely and lawfully employ armed maritime security providers onboard their vessels. This extremely topical and timely paper can be downloaded from their website www.graypage.co.uk.

Gray Page is a specialist maritime intelligence, investigation and crisis management company which assists clients solve commercial and operational problems in difficult and sensitive circumstances.

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Marine purchasing and supply professionals will heading for Kensington Town Hall on 14 and 15 September the International Marine Purchasing Association's (IMPA) annual exhibition and conference.

IMPA says that all available stand space was snapped up well before the end of last year, so once again more than 80 exhibitors will be showcasing every conceivable product and service across three floors.

Meanwhile the focus has been on assembling a comprehensive conference programme including presentations, workshops and briefing sessions from leaders in their field.

The programme begins with a challenging keynote address by Thomas Woidemann, president of Lauritzen Kosan, the gas carrier division of Denmark's J Lauritzen. He will be inviting delegates to consider a 'strategic perspective' in the role of procurement and supply chain management for the global shipping industry.

Echoing the popular format of recent years, the event will continue with a highly informative series of workshop and briefing sessions examining a wide range of compelling subjects - such as spare parts procurement, e-commerce, environmental issues, purchasing techniques and innovations. The content is designed to provide practical support for business development as well as stimulating an exchange of views among buyers and suppliers.

IMPA chairman and CEO Jan Johannessen says: "I am confident that this year's conference programme will induce some good discussion and hopefully unearth some ideas for new strategies that may help us all in our day to day working lives."

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The Institute of Marine Engineering, Science and Technology (IMarEST) has moved its headquarters to Aldgate House, 33 Aldgate High Street, London EC3N 1EN.

The switchboard telephone number +44 (0) 20 7382 2600, general fax number +44 (0)20 7382 2670 and all direct dial numbers remain unchanged, as do email addresses.

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A series of lectures for apprentices and young shipwrights designed to inspire interest in the UK's unique position in international yacht design and boat building has been announced by the Worshipful Company of Shipwrights in conjunction with the University of Southampton.

The first lectures will take place in Southampton on 19 October and will be followed by a second event in February next year. The theme is "Past, Present and Future" and both sail and engine powered yachts and small craft will be discussed. Attendance is free for apprentices nominated by their employers, and young people under the age of 25. Each Apprentice will receive a certificate of attendance for each lecture subject.

For more information contact: Michael Derrick: derricks@globalnet.co.uk 00385 91 767 6388. disposal.”

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