A Recognized Port of Refuge in the UAE?

There has been an alarming increase in ship casualties in recent years, often caused by fire in containers, in holds or in the engine room. Recent casualties in the MENA region include the MAERSK FRANKFURT (fire and explosion), the ASL BAUHINIA (fire in Containers on board) and the WAN HAI 503 (fire and explosions), all of which eventually found a Port of Refuge in Jebel Ali, Dubai.

The weeks and months that are often passing between the incident and the final arrival in a Port of Refuge have led to a revived discussion about a recognized and regulated Port of Refuge in the UAE to support shipowners in their efforts to minimize losses and damage to the environment.

Whilst it remains the liability of the ship operator to find a safe place of refuge for his vessel in distress, we have seen several cases were the refusal by coastal states to accept these vessels in distress has led to a significant damage, as seen in the X-Press Pearl incident. In addition to the catastrophic environmental, navigational, and commercial consequences resulting from her sinking, the Sri Lankan Court judgment on the X-PRESS PEARL, ordering a whopping USD 1 billion compensation, following the sinking and environmental damage is massively increasing the liabilities of the insurance companies and shipowners.

Therefore, we believe such cases should be a further signal that vessels in distress need to find a safe haven in a reasonable timeframe and without unnecessary delays.

 

An Overview of the Port of Refuge Concept

A Port (or place) of Refuge serves as a critical safe haven for vessels in distress at sea. Whether due to extreme weather, structural failure, mechanical breakdowns, onboard fires, or other emergencies, a ship may need to divert to the nearest safe port.

In such situations, the Port of Refuge becomes the vessel’s final recourse to seek assistance and mitigate the damages it has sustained as well as reducing risks to navigation and protecting human life and the environment.

 

Absence of International Regulations for a Port of Refuge

In the absence of binding international regulations or conventions obligating coastal states to provide refuge to distressed vessels, the legal framework remains largely discretionary.

Art. 11 of the Salvage Convention (ratified by the UAE in 1993) provides that “a State Party shall, whenever regulating or deciding upon matters relating to salvage operations such as admittance to ports of vessels in distress …take into account the need for cooperation between salvors, other interested parties, and public authorities in order to ensure the efficient and successful performance of salvage operations for the purpose of saving life or property in danger as well as preventing damage to the environment in general.”

The United Nations Convention on the Law of the Sea (UNCLOS) would be the most obvious convention to regulate a Member State’s obligation regarding a Port of Refuge, however, there is no mentioning of a Port of Refuge Concept. Instead, Art. 2 recognizes the right of States to regulate entry into their ports and further provisions establish the right of coastal States to take action to protect its coastline.

In GA terms, towing the vessel to a Port of Refuge is considered an allowable expense under the York-Antwerp Rules, however, the Rules do not make any reference to specific regulations for Port of Refuge.

The Comité Maritime International (CMI) acknowledged the lack of binding regulations and provided a draft Convention to the IMO, which in turn decided to provide only a guideline, i.e. IMO Resolution A. 1184 (33).

Also the European Maritime Safety Agency (EMSA) issued EU Operational Guidelines on Places of Refuge under the VTMIS Directive (Directive 2002/59/EC as amended).

Above guidelines are non- binding and serve solely as recommendations for coastal states, shipmasters, salvors, and other involved parties to guide their decisions when a vessel in need of assistance seeks a place of refuge.

 

Complexities and Liabilities of choosing a Port of Refuge and of accepting a Distressed Vessel

Whilst the respective parties for the vessel in distress (and here we speak of the Shipowner, operator, Insurer, Salvor, Class, Flag State etc) need to decide on a suitable Port of Refuge, so must the respective State assess the accompanying risks of accepting that specific vessel.

This decision involves significant commercial, environmental, financial and humanitarian risks.

 

Who Decides on a Port of Refuge?

The decision to divert a ship to a Port of Refuge involves collaboration between three key stakeholders:

1. Flag State: The country of registration assesses regulatory compliance and safety.
2. Port State: The host country evaluates environmental risks, infrastructure capability, and overall feasibility.
3. Insurance Providers & Salvors: P&I clubs, underwriters, along with the appointed salvors ensure that all risks are properly assessed, managed, and covered financially.

This tripartite cooperation is crucial to ensure a successful and legally sound response to maritime emergencies.

Selecting a Port of Refuge

Determining an appropriate Port of Refuge involves a multidimensional assessment, often with the salvor who signed the LOF being on the forefront:

• Safety and Accessibility: The port must be reachable given the ship’s condition, with adequate depth, manoeuvrability, and anchorage.
• Facilities and Services: It must offer cargo handling equipment, waste management facilities and secure storage.
• Environmental and Security Factors: The port must not pose added environmental risks or be located in high-security threat zones.
• Regulatory Compliance: Authorities must be willing and able to accept the distressed vessel under clear legal frameworks and insurance coverages.

 

Port State Assessing the Risk

Port states typically impose strict conditions before granting refuge:

• A valid Lloyd’s Open Form (LOF) agreement has to be in place.
• Full P&I (Protection & Indemnity) and Hull & Machinery insurance coverages must be confirmed. Will the Club provide an LoI?
• Appointment of reliable and experienced salvors.
• The Port needs to have the experience and the relevant insurance cover.
• A certified waste management company must be involved to handle any hazardous materials.

Each country has the discretion to set its own internal policies and requirements, which means decisions are often made on a case-by-case basis depending on the nature of the emergency.

 

Challenges When Ports Refuse Entry

There have been high-profile cases where ports denied entry to distressed ships, often due to environmental concerns or political sensitivities. Notably, the Prestige and X-Press Pearl incidents resulted in catastrophic oil spills and vessel losses after being refused refuge. These tragedies highlight the urgent need for a more unified international approach to handling vessels in distress.

 

 

Conclusion: The UAE’s Role as a Reliable Maritime Partner

While the absence of binding international regulations makes it difficult to obligate any state to act as a Port of Refuge, the UAE has proven its capability and willingness to play this vital role. Its recent actions underscore the country’s readiness to manage complex salvage operations, coordinate with multiple stakeholders, and mitigate potential environmental and commercial risks.

Streamlining the processes by providing a national regulation of a Port of Refuge and officially recognizing respective UAE Ports as such, would certainly provide involved parties with further confidence and we are confident that the UAE maritime administration is already working on respective regulations and will issue a ministerial resolution by the end of this year.

Our firm has the necessary expertise for drafting and advising on LOFs, consulting on Port of Refuge and respective legal systems, coordinating between involved parties and providing legal support to the UAE government, port authorities, salvors, and waste management companies.

Key Takeaway:
The UAE is not only reinforcing its status as a major maritime hub in the region but is also setting a global precedent for responsible and strategic maritime governance. With its growing experience, infrastructure, and commitment to international best practices, the UAE is well-positioned to be recognized as a trusted and capable Port of Refuge in the global maritime community.

 

 

	Jasmin Fichte Managing Partner Email: jasmin.fichte@fichtelegal.com Mobile: +971 50 210 1003
	Shehab Mamdouh Managing Associate Email: shehab.mamdouh@fichtelegal.com Mobile: +971 50 459 9590