Cyprus recognised, as early as 1963, the political, economic and social importance of shipping. Since then, successive governments have been implementing the right policies, thus managing to develop the island into a fully-fledged shipping centre combining both a sovereign flag and a resident shipping industry, which is renowned for its high quality services and standards of safety.
The establishment of the Department of Merchant Shipping, as a distinct entity in the Ministry of Communications and Works in 1977, inaugurated a new era of development in this important sector. The registration of ships became just a part of an all-round effort to establish a sound infrastructure, which would facilitate not just the registration of ships but also ship management and other shipping related activities in Cyprus.
The Department of Merchant Shipping is responsible for the development of maritime activities, which include: registration of ships, administration and enforcement of the Merchant Shipping Laws, administration of the tonnage tax system, control of shipping and enforcement of international conventions ratified by the Government of Cyprus, vessel traffic monitoring around Cyprus, investigation of accidents involving Cyprus ships or seamen serving on those ships or foreign ships sailing within the territorial waters of the Republic, resolving labour disputes on board Cyprus ships and training and certification of seafarers.
The Cyprus Register of Ships has shown phenomenal growth in the last twenty-five years. In the early eighties Cyprus ranked thirty-second on the list of leading maritime nations. It now ranks in tonnage terms as one of the ten largest in the world with a merchant fleet exceeding 20 million gross tons. Also, the Cypriot merchant fleet ranks third in the European Union with a percentage of above 11% of the total fleet of the 28 EU member states.
Cyprus is considered as one of the leading third-party ship management centres in the world. More than sixty ship management companies are established and operate in Cyprus, many of which are considered among the largest ship management companies in the world. In conjunction with these more than one hundred companies have been established with shipping related activities, ranging from marine insurance, ship chartering, ship-broking, financial services, equipment suppliers and telecommunications, to port services, transshipment operations, shipping agents, ship chandlers and ship bunkering.
Cyprus introduced in 2010 the tonnage tax system. This system covers the owners of Cyprus ships, owners of foreign ships, ship managers and charterers and is approved by the European Commission as compatible to the EU acquis and the Community guidelines on State aid to maritime transport. This tonnage tax system enhances the competitiveness of the Cyprus flag and the maritime cluster and paves the way to achieving even better results in the near future.
The Cyprus Government has been taking a series of measures in order to improve the safety standards of the Cyprus merchant fleet and to minimise the number of marine accidents; thus eliminating sub-standard shipping and minimising the environmental impact of maritime transport, which are deemed necessary for the achievement of the safe, secure and efficient shipping on clean seas. To this end, age limits have been imposed for the registration of certain categories of ships and strict requirements have to be fulfilled at the time of registration. Furthermore, a network of independent inspectors provides adequate coverage of inspections globally. The effective implementation of these measures enabled Cyprus to achieve a ‘White List’ status in the flag assessment system maintained by the Paris and the Tokyo MOUs on port state control, thus resulting in fewer inspections of the ships and less delays at the ports of both MOUs.
The Cyprus Government attaches considerable importance to the improvement of living and working conditions of seafarers on board Cyprus ships in accordance with safety practices and International conventions, currently in force, for decent employment. These become increasingly more important since Cyprus ratified the Maritime Labour Convention of 2006(MLC 2006); and Cyprus as a port State ensures, as from 20 August 2013, that foreign flag ships which call Cyprus ports comply with the provisions and requirements of the MLC 2006.
Cyprus also introduced in 2012 a comprehensive legislation to help counteract piracy-unlawful acts against Cyprus Flag ships. The Law is a pioneering legislation establishing the required legislative framework allowing the use of armed personnel on board Cyprus flagged vessels, in a regulated manner, when these vessels are sailing through high risk areas. The Law incorporates the recommendations and guidance developed by the International Maritime Organization in relation to privately contracted armed security personnel. Furthermore, the Law takes into account the provisions of the United Nations Convention on the Law of the Sea. The very high percentage of utilisation of the provisions of the Law by our ship owners proves that the Law satisfies the requirements and needs of the shipping industry in a comprehensive way.
The efforts to improve the image of shipping are not limited to Cyprus shipping. As a member of the IMO Council, Cyprus plays a significant role in the formulation of the future strategy and the regulatory work of the Organisation and is influential in the decision making process. Cyprus also contributes significantly to the achievement of the objective of the IMO, namely safer seas and cleaner oceans.
Contribution to Economy
The contribution of merchant shipping to the economy of Cyprus is significant. The Cyprus government is well aware that through shipping, Cyprus has distinguished itself by achieving remarkable international ranking and recognition far beyond its size and boundaries.
Shipping contributes approximately 5% of the Gross Domestic Product of Cyprus, while 4,000 persons are employment in shipping activities, the majority of whom are Cypriots.
For further information and updates please refer to:
Department of Merchant Shipping
Tel: +357 25 848100, Fax: +357 25 848200