Shipping and the Law speakers share perspectives on industry issues

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31 Oct 2011

Leading figures from the Italian and International shipping, ports, finance, insurance and legal community met last week in Naples for the second annual ‘Shipping and the Law’ conference, hosted by Studio Legale Lauro.

More than 250 delegates heard experts from across Europe discuss the pressing issues of the day, among them, ports infrastructure and logistics, the need for regulatory reform, trends in ship finance and shipbuilding contracts.
Francesco Lauro, the organizer of the Conference, who chaired the Ports session, commented: “The success of Shipping and the Law 2011 shows that Naples, the capital of the Italian shipowning industry, is becoming also an important center for shipping services and know-how.”
In his introduction to the day’s proceedings, Confitarma president Paolo D’Amico praised the recently-agreed rules allowing Italian military detachments to guard Italian flag ships.
“The Italian government will take part in active defence and put military staff on ships, which implies there will be clear rules in practice. This result demonstrates government and business working as a team for the common good. Getting this done so quickly was quite an achievement.”
But he noted that Italian shipping was being held back from achieving a better competitive position by an out-dated and bureaucratic legislative system, which kept civil servants in a system of rules.
“Since 2008, even a minimal advantage is commercially imperative and we need measures to relaunch our competitiveness. Politicians have to understand we need a new policy which updates rules and regulations. We need good and strong measures – both theoretical and operational,” he added.
In the Ports and Infrastructure session, Patrick Verhoeven of ESPO reviewed the recent changes to ports and logistics strategy in the European Union, noting that recent moves by the commission “have brought priorities forward and defined added value and which ports are core and which part of the broader network”.
Paolo Costa of Venice Port Authority outlined the progress on its new four berth ro-ro terminal and its innovative financing solutions. The port authority sought and secured investment of 80% from private sources and applied innovative approach to sharing demand risk with the private investors. “We have finished the paper phase and we are in the brick phase,” he said.
In the Ship Finance session, the issues of contract renegotiation were discussed, along with the trend towards new forms of finance for shipbuilding projects.
Giuseppe Mauro Rizzo of Rizzo-Bottiglieri de Carlini Armatori said that market snapshots were of little value in such a cyclical industry. What was needed was greater partnership between shipowners, yards and class. “This is the time to see the opportunity for synergy, for co-operation particularly with shipbuilding interests. More and more we should look for commercial alliances and joint ventures,” he said.
Francesco Fuselli of Banchero Costa noted that shipping should be supported by the banks, “but it is hard to find that support. We are all trying to find out to what extent the Chinese banks can help us.”
The Shipping M&A session heard from Angelo D’Amato, managing director, Perseveranza di Navigazione, who said that while consolidation seemed likely, he was sceptical there would be many deals done.
“The reality seems to be that there will be more concentration but on the other hand it has normally been the opposite in this industry,” he said. “When your family has a history of 100 years, it is more likely that you co-operate and have commercial agreements with others. In the short term, I think it is much more about exchange of information.”
A special afternoon session on Managing Risks of Piracy examined the recent decision to allow armed detachments on Italian flag ships and the role of armed guards in fighting Somali piracy. This was considered from the perspective of underwriters, lawyers, insurers, operators, naval and defence experts.
Francesco Lauro gave his perspective on the new legislation and in thanking Paolo d’Amico for, “his successful efforts to provide Italian ships with an important deterrent including Military Protection Detachments”, expressed the hope that “the steps still necessary to implement the new legislation would be quickly finalized”. These are the drafting of the rules of engagement and the conclusion of Memorandum of Understanding with the coastal states where the Military Detachments shall embark and disembark.
Andrea Dalle Vedove of Assicurazioni Generali noted that the average ransom payment had risen from $600,000 in 2008 to $5m in 2011, with the highest so far this year being $13.5m. The mitigation of risk using War Risk policies is decreasing in favour of Kidnap & Ransom insurance, he said while the use of private armed security is increasing dramatically.
North of England Club’s Mike Salthouse and UK Club’s Chris Brown gave the mutuals' perspective. Mr Salthouse pointed out that when contracting armed guards owners need to ascertain whether the contract itself is compliant with the terms of their cover. Mr Brown added that owners should also be sure that their use did not trigger policy exclusions.
Alessandro Morelli of AXA Corporate Solutions said a weak point in current piracy reporting is that when an armed ship repels an attack, this fact is not reported in the IMB statistics, making it harder to demonstrate their efficiency.
Joanna Steele of Bentley, Stokes and Lawless said the ‘piracy stakes’ are undoubtedly getting higher – not least because a hijacked ship is still seemed on-hire unless tailor-made clauses are included. Could the current situation under which commercialisation of piracy continues become unsustainable, she asked. “Ransoms are legitimate to pay but the lawyer’s dilemma is that we are caught between the rule of law and the best interests of our clients.”
The afternoon keynote was made by president ad Honorem of Comite Maritime International Francesco Berlingieri who addressed probable issues arising when the Athens Convention comes into force as an EU regulation in 2012.
Mr Berlingieri said the passage of time between the adoption of the Athens Convention and its entry into force had created potential conflicts between Athens, the convention on Limitation of Liability and the Hague-Visby Rules on the issue of personal liability limits. “There may be a conflict when the convention comes into force as an internal law in the European Union. The question of which convention applies could create a problem of comparison and a possible clash in future,” he observed.
Presentations and interventions were also made by a number of leading international and Italian maritime industry figures, among them:
Nicola Coccia, President Financial Commission Confitarma,  Simon Curtis, Partner Curtis Davis Garrard, Ugo Salerno, CEO Rina, Peter Jago, Partner, More Fisher and Brown,  David Pitlarge, Partner, Hill Dickinson, Giuseppe D’Amato, President Perseveranza di Navigazione, Umberto D’Amato, CEO Perseveranza di Navigazione, Richard Janssen, Commercial Manager Smit, Pietro Galizzi, General Counsel Saipem, Carlo Cameli, Managing Director F.lli d’Amico Armatori, Valeria Novella, President, Young Owners Confitarma, David McInnes, Partner Ince & Co, Francesca Barbaro, General Manager PB Tankers, Antonio Ciocchi, Managing Director V.Ships, Monaco, Mauro Iguera, Managing Director CR Marine & Aviation,  Federico Deodato, Managing Director P.L. Ferrari & Co, Diego Pacella, Managing Director and Chief Executive Officer Grimaldi Group and Pietro Zanini, General Manager, Wartsila Italia.
Source: Studio Legale Lauro