Feature: Aviation learns from shipping

News was prepared under the information support of Online Daily Newspaper on Hellenic and international Shipping "Hellenic Shipping News".

31 Oct 2009

Aviation, often held up as a role model for shipping, has been taking lessons from the maritime world. The exchange of information and ideas between the two industries may have been predominantly one way as shipping has looked at how, in particular, aviation manages safety (voyage data recorders and bridge resource management are two examples of borrowed ideas), but the airline industry has also turned to the maritime sector to learn how it deals with open registers, or as they are more controversially known, flags of convenience.
While aviation is highly regulated in terms of safety the liberalisation of the sector has resulted in airline registering both themselves and their aircraft in different countries where standards of safety oversight may be deemed inadequate by internationally-agreed standards. When fears were first raised over a decade ago that aviation might be following shipping in the use of flags of convenience, they were initially dismissed as alarmist.
The industry’s global regulator, the International Civil Aviation Organisation (ICAO), however, has since acknowledged that “flags of convenience” (the term used by ICAO, as well as the European Commission and the airline industry’s association among others) do exist in aviation and it has been putting in place a series of measures to reduce their threat to the industry’s safety record.
The aviation body identified two different types of flag-of-convenience operations: those that were for fiscal reasons where arrangements were generally made between the state of registry and the state of the operator to ensure proper oversight; and those arranged to “take advantage of a system with no or minimal economic or technical oversight”. The second group, ICAO said, was creating “serious safety concerns” and prompted it to consider counter-measures.
As part of its approach to the problem, ICAO looked at how its counterpart in shipping, the International Maritime Organization (IMO), had approached the problem and whether it could adapt any of the maritime world’s responses. Interestingly, while the aviation regulator uses the term “flags of convenience”, it is not one used officially by the IMO. ICAO says it will consider “appropriate terminology” for the second group of flag-of-convenience operations.
Similarities in the regulatory framework of the two industries were noted, with the flag state in shipping, for example, corresponding to the “state of registry” in aviation. In shipping, however, ICAO noted, there is no equivalent of aviation’s “state of the operator”. Curiously, however, it adds “a genuine link must exist between the state and the ship”. The “genuine link” principle may exist on paper but it has never been defined.
While acknowledging primary responsibility for ensuring ships comply with international laws rests with the flag state, ICAO noted enforcement of the principle is in practice carried out by port-state control. It also noted the harmonisation of inspections between the various regional port state control regimes and the publishing of detention and inspection data on the public-access Equasis website. “Effective port state control has placed a higher degree of pressure on flag states, as they could fall into disrepute if ships under their registry are detained and that state’s registry could be, in effect, blacklisted,” ICAO noted.
ICAO also considered the IMO unique number that ships must now have and display. While aircraft are assigned nationality and registration details, these can change through their operational lives. From these two shipping initiatives – port-state control and the unique number – have come aviation’s answers: the development of an international register of aircraft operating companies (AOCs) and a database of all aircraft regularly engaged in international traffic with information including registration, ownership and control. The latter will include a “unique identifier”, for which ICAO has considered the use of manufacturers’ serial numbers.
In an update on progress made in developing these measures the ICAO told a recent meeting of civil aviation bodies in the Caribbean that the database of aircraft was nearing the operational phase but the start-up of the AOC database had been delayed by a lack of funding as donors were affected by the global financial crisis. The airlines’ association, the International Air Transport Association (IATA), has since promised its support. It too has been concerned that flags of convenience may jeopardise the industry’s safety record, with its secretary-general stating, “Flags of convenience have no place in a safe industry”.
ICAO has, however, acknowledged that, while being confident measures already in place and those now being developed will minimise the risk, there are problems still to be resolved. These include defining precisely terms such as “principle base of business” and the issue of leased aircraft where ownership rather than control rests elsewhere. Simplifying “ lines of accountability” among states in situations where aircraft are based or operated in states different from those of registry and/or of the operator is also seen as an area where further work is needed.
An aviation port-state control system already exists in that countries can and do take action against aircraft, airlines and states of registry with powers of detention and the ability to impose bans on use of their airspace. In 2006 the European Union began blacklisting airlines “to root out the practice of flags of convenience whereby some countries issue Air Operation Certificates to dubious airlines”. The US’ Federal Aviation Authority also audits other countries’ safety oversight and, based on these, can refuse or revoke permission to operate to or in the US.
ICAO, however, believes the authority to detain non-airworthy foreign aircraft “is not as formalised as it is in the maritime world”, while guidance on “search and inspection rights” of states is lacking. “The absence of international standardisation is clearly an obstacle to a more efficient and uniform means of controlling flags of convenience,” the aviation agency noted. The liberalisation under “open skies” policies has brought with it greater demands for globally harmonised safety oversight.
Having looked to aviation in the past for ideas on how to address the issue of safety, shipping may be interested to learn how it deals with flags of convenience, even if the term itself, given its political connotations, is one that it does not universally accept.

Source: Bimco