Kenya has ordered all the shipping lines that ply its waters to register with the industry regulator by June 1 in an effort to boost collection of fees and rid its maritime space of illegal activities.

Ships that operate solely on the Kenyan territorial waters must register by May 20 while the foreign-flagged vessels have been ordered to furnish the Registrar of Kenyan Ships with their details by June 1, the Kenya Maritime Authority (KMA) says.

“Any ship owner, operator, agent or master who engages a foreign ship in local trade or causes a ship to trade or operate solely in Kenyan waters without a licence commits an offence,” said KMA director-general Major (Rtd) George Okong’o.

He adds in the notice published yesterday that “…every offending vessel shall be barred from trading in and operating solely within Kenyan waters.”

The move comes amid rising concerns in the maritime fraternity that poor enforcement of existing laws has made it possible for foreign ships to frequently breach Kenya’s boundaries to engage in illegal fishing, smuggling of goods and dumping of harmful waste on the country’s territorial waters.

Section 14 (2) of the Merchant Shipping Act 2009 restricts the Kenyan waters only to Kenya-flagged ships with section 57(1) of the same law requiring vessels “of whatever length” operating within the territorial and inland waters be licensed by Registrar of Kenyan Ships.

Kenya, which receives slightly over one million containers every year at its Mombasa port, does not have a local merchant shipping line. The country relies on foreign merchant vessels which make approximately 1,800 calls annually at the Mombasa port, bringing imports and ferrying exports to market across the world.

The country therefore counts on collection of registration fees, a formality that confers artificial citizenship to a foreign ship, as part of its earning from the industry.

The Cabinet Secretary under whose docket the maritime affairs fall is mandated by the Shipping Act 2009 to prescribe and vary the fees payable for ship registration.

Registration also enables a country to impose its code of conduct on the ocean-going vessel as licensing conditions compel them to observe all the laws and international conventions that Kenya has signed.

For some time now, the Department of Maritime Affairs has been pushing for fiscal incentives to attract more foreign ships to register in Kenya.

The department sees current “prohibitive” customs tax regime, value added tax and trade taxes as the priority areas “that must be addressed urgently” to encourage shipping lines to register their vessels in Kenya.

“Kenya maintains a closed registry despite being a non-ship owning jurisdiction as a result of which the chances of growing its ship register remain minimal,” the Department said in an earlier presentation, adding that fiscal and regulatory incentives determine a country’s suitability for ship registration.

In a 2015/16 budget statement, the Department appeared to be getting its way after Treasury Cabinet Secretary Henry Rotich allowed investors to recover all expenses incurred in acquiring shipping vessels from profits before remitting their taxes.

The temporary measures, which were however in force for only one financial year, also reduced the size of ships that qualified for investment deduction from 495 tonnes to 125 tonnes.

Kenya has since, in the meantime, launched Kenya Coast Guard Service, a multi-agency security unit based in Mombasa, to enforce law and order in its territorial waters.

Source: Business Daily Africa