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Consultancy on Inspection, Mortgage and Building of Ships

Consultancy on Inspection, Mortgage and Building of Ships

Consultancy on Inspection, Mortgage and Building of Ships

 Vietnam is a country with 3,350km long coastline along with 286 port terminals at 32 seaports. Therefore, the use of ships in transportation of passenger and cargo is extremely developed. As a result, the legal issues of ships as consultancy on inspection, mortgage and building of ships are very important to entities owning, operating a ship.

  1. Issues on inspection of ships need a consultancy on inspection, mortgage and building of ships

 The ship registry means the inspection, measurement and testing of ships and equipment on board with a view to certify that ships comply with regulations of law, national technical regulation on classification and construction of ships, tonnage measurement, ship safety equipment, lifting gear used on board, the systems prevents pollution of ships and international treaties to which Socialist Republic of Vietnam is a member and in conformity with ship’s purposes.

Types of inspection of a ship include:

  • Initial survey, including: technical-related examination and surveillance of new construction and import of a ship; or
  • Regular survey, including: periodical survey, intermediate survey, docking survey, annual survey; or
  • Occasional survey.

Types of ships shall be inspected including:

  • Engine-powered ship that has the capacity of main engine of more than 75 kilowatt (KW);
  • Ship without engine which has the total capacity of more than 50 GT, or gross tonnage of more than 100 tonnes, or has the design waterline length of more than 20 meters (m);
  • Ships which have smaller sizes than those stipulated, but operate on international navigation routes, including a motor ship with the main engine power of less than 75kW or a non-motor ship with a gross tonnage of less than 50GT or a dead weight of less than 100 tonnes or a design waterline length of less than 20 meters.

The ship owner shall be responsible for implementing regulations on ship inspection when these vessels are built to normal working conditions and currently operated; ensure that they conform to requirements of technical maritime safety, security and conditions for maritime labour and environmental pollution prevention during the interval period between two inspections or evaluations under the provisions of laws and related international agreements to which the Socialist Republic of Vietnam is a party.

  1. Issues on mortgage of ships need a consultancy on inspection, mortgage and building of ships

Ship mortgage refers to a ship owner’s putting up his own ship as security for fulfilment of civil obligations to the mortgage without having to transfer such ship to that mortgagee. One ship may be mortgaged to secure a lot of obligations if value of the mortgaged ship is greater than total value of such obligations, unless otherwise agreed. Priority order of ship mortgages shall be determined, based on the order of registration of an equivalent ship mortgage recorded in the national register of ships of Vietnam.

Under the prevailing laws of Vietnam, mortgage of ships is subject to registration with the state authority, in detail, being Vietnam Maritime Administration or Maritime Sub-Administration, Maritime Administration of Vietnam affiliated to the Ministry of Transport.

Applications for registration of seagoing ship mortgage shall include: an application form for registration (01 original); a contract for seagoing ship mortgage (01 original or 01 certified true copy) and a written authorization if the applicant for registration in an authorized person (01 original or 01 certified true copy or 01 non-certified copy enclosed with original for collation).

  1. Issues on building of ships need a consultancy on inspection, mortgage and building of ships

Building of ship are specific investment activities; procedures and formalities for building of ship are performed in accordance with regulations herein and relevant laws. Ships to be built must satisfy the conditions on maritime safety and security and environmental protection in accordance with the law of Vietnam and international treaties to which Vietnam is a signatory.

The shipbuilding project with State funding shall be performed in accordance with regulations of the Law on bidding. If all regulations of the Law on bidding have been applied but it fails to select the qualified shipbuilding enterprise of shipyard, the competitive offering shall be adopted with the participation of at least 03 shipbuilding enterprises or shipyards or their representatives. The building of ships with other sources of funding shall be subject to decisions of enterprises, organizations or individuals concerned.

The process of executing the shipbuilding project with State funding includes the following five stages, but the project on building of ship with other sources of funding shall be subject to decisions of enterprises, organizations or individuals concerned:

  • Step 1: Approve the project of building a ship.
  • Step 2: Select, determine price and source of funding for building of ship; estimate costs related to the ship building transaction.
  • Step 3: Establish, appraise and give approval for the project on building of ship. The project of ship must include contents about the necessary of investment, type of ship, quantity, basic technical specifications of the shop, estimated price, source of funding for building of ship, form of ship building, method of operation, economic efficiency and other necessary contents.
  • Step 4: Make decision on building of ship.
  • Step 5: Complete procedures for building of ship.

Above is article related to consultancy on inspection, mortgage and building of ships 2018. Phuoc & Partners is a professional consulting firm established in Vietnam and currently has nearly 100 members working in three offices in Ho Chi Minh City, Hanoi and Danang. Phuoc & Partners is also rated as one of the leading consulting firms specializing in business law in Vietnam that has leading practice areas in the legal market such as Labour and EmploymentTaxationMerger and acquisitionLitigation. We are confident in providing customers with optimal and effective civil litigation service.