As practical i think they will hit it off similar personalities in recent days pakistan authorities have finally arrested one of the us his most wanted men of his saeed was accused of masterminding the 2008 terrorist attacks in mumbai since then living openly in pakistan despite a u. S. Bunty on his head theorist intended to set a cordial term for the contra meeting and it was when we welcomed by the president imran khans meeting with the president does not come without Political Risk his party has the narrowest of majorities in Pakistans Parliament and does not control the senate a resumption of u. S. Assistance would help shore up his government but to come away empty handed would have the opposite effect. Mike hanna aljazeera washington. Lets have a look at the top stories here it out to sara kenyas finance minister henry wrote has been arrested over a dam constructions scandal in iraq the 1st time this is in kenya mina since being arrested on corruption charges he and other officials are accused of flouting procurement rules when they awarded the building project to a bankrupt Italian Company has denied any wrongdoing but ive been speaking to Catherine Sawyer who explained the case so far hes a very high profile individual in the government he has surrounded himself alongside his deputy the director of Public Prosecutions also ordered their arrest of. Of a past at all that were supposed to see oversee this project some of those officials have already also so are surrendered themselves and has also issued a warrant of arrest for employees of the Italian Company that was supposed to undertake the construction to begin with and i have seen this statement by the director of public prosecutors and it talks about a construction of the 2 dams father north that has not even begun months in 4 years after it was commissioned. Alshabaab in somalia has claimed responsibility for a bomb which killed at least 10 people others were injured near the International Airport in the capital mogadishu it was a suspected car bomb and gunfire was also heard near a security checkpoint. Syrian government airstrikes have killed and wounded dozens of civilians in italy province several people are still believed to be trucked in rubble after a busy market came under attack. Britains Prime Minister is holding an emergency meeting to find a way to respond to iran seizure of a u. K. Flagged the oil tanker london is reportedly considering a range of options including limited sanctions tehran maintains its action was legal and the vessel with 23 crew members on board broke maritime rules palestinians are being made homeless because Israeli Forces are demolishing their homes despite warnings from the un and the e. U. Residents of what homeless lost their 7 year legal battle to overturn a military victory in order when Israels High Court dismissed their case all right up to date those the very latest headlines from us here at aljazeera coming up next its inside stories just to stay with us. Our flags of convenience and Inconvenient Truth for the shipping industry the registers the arabian oil tankers seized by britains armed forces and dozens of other ships to why are they sailing under a foreign flag and should the practice be stopped this is inside story. Thanks. Hello and welcome to the program im to. The threat of military action between iran and the u. K. Oversees the oil tankers is provoking a debate about a common practice in the shipping industry many vessels are owned by companies in one country but registered in another an example is the iranian tanker detained by britains Royal Marines a couple of weeks ago the British Government said the grace one was stopped near gibraltar for carrying oil to syria in violation of e. U. Sanctions like around 7000 ships worldwide the tanker was sailing under the flag of panama but the panamanian say they removed the super tanker from their shipping register 2 months ago and their d. Registering another ship which disappeared from tracking maps in the strait of hormuz last week well under International Law every commercial ship must be registered in a specific country many ship owners choose a foreign country to register and a practice known as flag of convenience the flag state is responsible for a say. The inspections and working conditions of the crew ships registered under flags of convenience can often reduce operating costs avoid regulations and hire cheap cruise panama has the Worlds Largest shipping registry followed by liberia and the Marshall Islands critics though say the practice allows substandard regulations and makes it hard to hold ship owners to account and some shipping is involved in crimes such as smuggling weapons or illegal drugs. Lets bring in our panelists for this discussion via skype from kingston in the canadian province of ontario we have who chang has any ari hes a professor of International Relations on Security Issues at the university in all mon joining us from london is phil diak on hes a Maritime Security analyst also a partner at the Maritime SecurityRisk Consultancy dryad global and over in new jersey via skype we have Lawrence Brennan he teaches maritime law at Fordham University thanks very much for joining us on inside story and welcome to all a few fill if i may start with you over in london is it fair to say that part of that cheaper and easier process of registration in another country doesnt mean fewer regulations for these ships and recent incidents in the gulf are now shining a spotlight on certain issues. I think its fair to say that the industry as a whole has improved its standards considering over the last decade or so and most of the prominent flags of convenience are all signatories to the best and highest standards the thing to remember is that a flag of convenience is ineffective effectively a business and the businesses are trying to attract their customers and we talk about panama being the largest so what it offers is a set of regulation and standards and as you mentioned every vessel has to ascribe to a flag therefore its trying to attract as much business to itself now they may all ascribe to the highest on the safe or environmental for ship and safety and welfare and some of the areas youve already mentioned and whilst the flag of convenience in this case how them are is the largest there are others also vying for business so im not sure its fair to say that its a way of avoiding issues but each vessel owner will discard decide based on their own Business Metrics as to which flag they will describe to. Over to laurens brenin just break down for us if you may when its merchant ship registers with a country known as were saying as its flying state what does this actually mean in terms of how much oversight and jurisdiction the country has over the vessel. The country has over administrative oversight over the vessel the manning the crew the safety and security regulations. But not to the exclusion of other nations. Depending on the circumstances the location of the ship other nations especially port states have the right to inspect and regulate flags of convenience can be of high quality and some are not of the same quality and as my colleague noted earlier theres been a an improvement but throughout the 1960 s. And seventys most of the major environmental disasters were on tank vessels tankers that were flying plagues of convenience and a lot of those were old ships that could no longer survive after open 90 the exxon valdez disaster the older tankers 25 years and older and the single hull tankers were were taken aside but weve had similar problems the ones were seeing in the persian gulf strait of hormuz and even the in the gulf go for belmont in the 1980 s. In the tank a war involving eram in to some extent iraq in the United States where there was war declared on tankers bound for each other the enemy rand would attack it tankers bamf air rack and vice versa ultimately the United States volunteered to represent other nations and damned certain tankers that were being attacked and in fact the kuwaiti tankers were reflagged as u. S. Ships in the late 1980 s. The flag of convenience states are parties to many of the International Treaties there are questions and disputes among the experts as to the ability of those ships to be inspected investigated but a lot of that work is done by classification societies and again some experts will disagree that qwest haitian societies are equal in their representation in their skills in the United States. The american brewer shipping is not a National Society but is the society that does most of the inspection create us what chips and in some port the u. S. Coast guard but Lloyds Register theres an italian registry a german registry and they have many skilled professional surveyors former captains of ships former chief engineers and licensed professional engineers let me cross over to canada and what china has done yari so obviously what were hearing from the panelists is that this is a money making industry for countries like panama and liberia who offer this type of service but why do you think countries flock to panama in liberia and why do they register their ships over there as michael mentioned that there are a number of countries who are known to have. Vast majority few issues on their flag. Gardens and the. Like very arguable there is not as i. Use for a number of issues for example when the americans in the early 1920 s. That they decided to do that was to somehow to to make you detour on their mind. Not on alcohol. Relations that existed during those days disturbed by putin and other countries. To destruction was that. There are other cases out there that there is a combination. Of Business Model number of companies they would benefit from. A convenience to some august they dont want to get to take this possibility for for 40 ships i mean distaste im talking about this so it combination of reasons. You know came together and. In order to put us in the situation that we are getting now so what do you say vanity fair says that. Which i has on the ari is that a fair system which allows these countries to avoid all sorts of things like taxes inspections and labor laws not necessarily because for example your weight in kind says it is not convenient for the country that loses that that. Is good for the company. Benefiting from the situation its like if for example you. Claim a plane used. By a company lets say. Any given country that. Plane comes under the jurisdiction. And so davey had a unit that used to benefit from despair is it. That that pain in some other cases when there is not such a thing and then that creates this is why he did meant you bought it its really. Become now it came to surface in this context for her country and the rest. Confiscating ships and so forth so that hes in need really to improve even further that i know my colleague mentioned that the situation that youre living in now is much more convenient and much more improve the comparison to the old relations that existed but the reason need really that you review. The deuce you in order to make it very very clear that each. East has if thats right. And not just the. Kon been in a convent for 4 for the owner has for example been a minute registering a number of ships on line even seen those those ships and that east is creating a problem. In the past few years in. Government in panama. A. Big number of those who use it for a number of reasons violation of International Law and so forth and some of those flags everywhere used by Current Events so although this is not fair but in the absence of better after the b. B. C. s ration that you are confronting now and that is not. Clearly an idea that situation fell over to you as our panelist from canada was saying panama has now decided to deregister a number of steps were hearing up to 60 ships over the past few months and that includes the grace one thats the iranian tanker that has been and is still detained as you know in gibraltar by u. K. Authorities to what extent do you think panama is very being pressured to do so at this point and if it is being pressured by whom so the International Chamber shipping monitors the flag states it publishes annually the performance of like states and the performance is measured in many many categories and is publicly available the purpose of that is to keep accountability amounts of like states for the fav reasons that weve just been discussing now the flexi its all businesses so theyre going to be concerned about their reputation and their ability to attract business or ships into their registry and therefore if theres a reputational issue such as a vessel that they is deemed to be breaking sanctions and operating a factory illegally then its up to them to really take action and. Clean up their portfolio so in this situation cleaning up portfolio is a regular event but we all seem very much aware of this one because this ones in in the news and its very current so the like states they are businesses they want to attract business and be seen to be compliant which most of them on the very large ones are and also those vessels that are registered with those flex states the owners of them the operators of them they also want to be associated with a compliant business or compliant process and registration process so this cleaning up is probably housekeeping that youve seen any business where the regular turnover vessels we just mention about applying online now if youve got a large volume of vessels moving around in terms of their registrations then some extent you know the or your administration of it and your ability to administer it effectively with inspections which should of course happen every time theres a registration until flag amongst many things then there will be the situation where perhaps as a lag between when station inspection right so the example given there of applying online you would expect to be caught up eventually to be conform conforming to the process of wresting feels like rights lawrence what do you make of this concept of cleaning up and particularly at this point in the context of all the regional tensions as a physically panama clean up or how much pressure do you think panama was under and by whom to the flag the iranian ships that they have in the past few months i think theres no dispute that the United States has encouraged panama liberia Marshall Islands and maybe others to take appropriate action to ships that are engaged in improper an unlawful conduct searches smuggling. Trafficking drugs while waiting sanctions. Such as was done at the early 21900 centuries by the u. S. And british navy in fighting the slave trade one of the important things to realize is the internet. Ashville nature of maritime commerce theres 35. 00 trillion dollars thats good every year in world global trade most of which 80 percent or so goes by sea and the infrastructure ships ports facilities and thats a lot of money its really the driving force of the World Economy oil is a significant part of that its probably the most valuable commodity trade. Where shipowners try to save some money is own crew its coal manning expenses bunkering expenses a small amount and the quality of the ship in the ability to keep the ship in service wanker and with fewer problems is important so its a business competition between competing problems with the managers of a vessel do we repair or ship do we keep it another 2 years do we get rid of it buy a new ship what the economic benefit ok family just family up on that point with you lawrence so clearly there is a big economic angle to this so if a vessel gets the flags then the owners of the ships might have to register the ships and their countries and correct me if im wrong here but so what are the economic implications of that. Well the us is a great example we have a thing called the jones act which requires us owned u. S. Flagged u. S. Manned ships to trade between 2 american ports so if you want to bring oil from the u. S. Gulf coast to new jersey you need a u. S. Flagged ship there are some interesting exceptions for cruise ships and passenger liner but if you have a u. S. Crew its probably 3 times the amount of cost now the magic issue that makes all ships equal is insurance and particularly environmental insurance what is the whats the cost of having environmental coverage pollution coverage under the checks and Indemnity Club p. N. I cover and the citizens get a financial responsibility no ship particularly no tanker is going to get into a Court Without having a citizen get a financial responsibility to show that if theres a pollution event theres millions of dollars available to respond to that pollution event and weve seen that historically in the world for the last 60 or 70 years and weve seen some ships break up in and cant get to whats called the port of refuge those are real problems the 1st thing we did at the beginning of the iraqi invasion of kuwait was to make sure that iraq could not use its ships in global trade its tankers and we were particularly concerned that they would use those tankers to cause an environmental disaster so the British Government the ministry the Foreign Ministry and the u. S. State department where i was a conduit as they say in london for my navy duties we arrange for an Order Council and u. S. And british insurers were prohibited from providing marine insurance to iraqi flag ships in 1900 that wasnt the 1st time its done its been done for hundreds of years right and its it continues to be done ok over to canada and when china has a new area what is. This the registration that were seeing by panama is it in your opinion a way to pressure iran to keep pressure on its economy on its oil flow. I think hes part of that that pressure because you dont doesnt have. That china. Use in order to. Or you have to be monitored or. Range to measure and our staff. Is precious you know for example if you look at the Current Situation there are 2 you know and in sheeps that are stuck in brazil because they they are not they cannot get fuel. By the brazilians because of the sanctions and consequently it puts a lot of pressure on on to eat any and. Hardly any to sanctions that are imposed on them by different teams or National Entities and so. You spend it any prostitute read. It makes it it makes you dont even more want to read to. You its ranting and i handed it to you was this the issues that ought thats what i made of it but there is no doubt that. I cannot use this said that. It meant so many other countries precisely because of the relationship that. Pertains. Rest of the community to know that there be any security risks however who are trying to widespread the registering of ships and particularly in hot spot areas like the strait of hormuz. I believe so because then. Like you did the other sheep that now eats. Eats arrested by eat any and so did you strip out that was the disappeared from the from the radars for sometime last last says they go is so now is in a limbo at least that its you that is also the heart. Is so that it and then the question is really what to do if you destroy or do you gain in going to q. To just simply let it sit in one of the again or so for how long and there who is going to take care of the crew and this so many other questions of that nature and read out for you go use the question of insurance and and its read read it again lets put it out yeah. Lets put that to fail because i see youre nodding your head phil ill give you an example stana imperio which is currently seized by iran for according to iran violating International Maritime law is in fact swedish oh and those on board are india under russian law and in filipino we hear but its the u. K. Flag thats flying that particular ship so is that fly just symbolic or to what extent does the u. K. Now oprah text and to that vessel. So youve just highlighted exactly the murkiness of what is the the oldest form of globalisation International Aspects to shipping so youve got u. K. Registered youve got swedish own youve got those different interested parties of the cargo so it is when it comes to whos got responsibility ultimately iran has an issue as impounded a vessel that has multiple interests normally its the u. K. Flag that sits above all however of course you know weve got a swedish and vessel part and we also go. But you call those so you know there are other parties that are going to feel the impact of the ever on his decision again thats the point before about is going to happen in the straits of hormuz is to registration process as a on a wider scale i dont believe just because its the straits of hormuz thats going to happen but were saying is that pressure applied to stuff like states either by themselves or by external parties to enforce whatever sort of sanctions or other rules that are being broken and to take action against them so in the case of perhaps the United States putting pressure on panama to take a closer look at vessels that are conducting activities that are regarded as perhaps illegal all counter to certain agendas then yes that we can see the registration processes with all the problems that my colleague has just mentioned with stranded cruise stranded assets to and where do they go in the case of a direct stated iranian vessel it can go back to iran but once its then flagged with an iranian flag what can it do we just heard that its options really are limited at lawrence final word to you do you think that were going to see more deregistration and more the targeting of fleets. Yes i think thats true but theres an important economic issue that is easily confused with deregistration and the seizures of ships recently and its the general maritime practice ships in court are personified theyre the same as a person so when my client calls up and said that the british flag tanker hit my fishing ship in the strait of hormuz and i have a maritime william and i want you to arrest that ship. There can be an arrest and its a civil process it normally doesnt occur with the Iranian Revolutionary guard launching helicopters and small boats its usually an order from a judge in a net madureira time court and its brought up by a civil office of the marshal or in some other countries the sheriffs right now in a case in a case like the one we saw or involving stana pirro. That would have been done in a telephone pole between the lawyers or representatives of the fish boat and in the tanker and they would have said hey my fish broke and he had it your tankers fault you owe me a 20000 dollars 100000 dollars a 1000000. 00 the owner of the tank would say i dont want my ship arrested anywhere but particularly here and now my insurance will be happy to give to you a document a sick piece of security a letter of undertaking a promise to pay a certain amount on settlement or final judgment an appeal ok that gets done around the world