SSI member makes history in Kazakhstan

Henderson Boyd Jackson, Scotland's No 1 shipping law Solicitors, have recently achieved a "world's first" by bareboat registering a number of vessels on behalf of their clients, BUE Marine, in the former Soviet Union, in Kazakhstan and Azerbaijan.

Bareboat registering is necessitated by the requirement of certain nations that vessels operating within their local waters must fly the flag of that nation. Before these ships are put to work in the Caspian, they are registered by their owners in a registry in the West. The ships are then bareboat chartered to a Kazakhstan or Azerbaijan company. A bare boat charter is one where the charterer takes control of the vessel and acts in almost every way as if it were the owner. The ships are then entered in the Bareboat Registry of the appropriate country and the western registration is suspended for the duration of the bareboat charter.

This type of registration was applied with the deployment of an innovative support/icebreaking vessel that had been constructed in Norway for HBJ's client, BUE; the vessel will be used to clear ice between the supply points and the oil rigs in the Caspian as well as providing services to the rigs themselves; and life saving capability. Construction costs exceeded $30million and the ship is destined to work for a consortium of Major International Oil companies for the next 10 years. HBJ have been involved since before construction began and, on delivery from the builders, registered the ship in the Cayman Islands before chartering her to a Kazakhstan company. The ship was then bareboat registered in the Kazakhstan Registry.

This type of work is further illustrated by the Azerbaijan bareboat charters that HBJ have recently completed. These occurred when BUE were contracted by a major oil company in Azerbaijan to supply four ships, including one previously operating in the North Sea, for the oil industry operating in the Caspian. Each vessel shall be registered in Azerbaijan as part of the $70 million dollar deal.

The real significance of this activity is the opening up of the Caspian and other Eastern European waters to western involvement in the oil and shipping industry - and the fact that an Edinburgh (and not a Hong Kong, New York or Singapore) maritime law firm is pioneering new types of working on behalf of its nautical clients - who themselves are at the forefront of these developments.

As Jim Lowe, Principal Partner at Henderson Boyd Jackson says, "There is every reason why the Scottish shipping industry should be taking advantage of the opportunities which now exist in Eastern Europe. These highly unusual bareboat charterings are an example of what we can do.

"The main centres of maritime law are London, Singapore, Hong Kong and New York but, as we've demonstrated, we can just as easily cross frontiers in the industry from Edinburgh."