One Obvious Move to Help Classification Firms Cut Loose Rogue Ships

UANI’s shipping campaign has been widely successful in compelling the world’s leading maritime classification societies to strip rogue ships of their certifications. Absent such accreditations guaranteeing a vessel’s seaworthiness, a tanker is barred from entry to foreign ports and may not secure insurance cover. Since the world’s top 12 classification societies are “essential to the running of thousands of vessels in the global shipping fleet,” this has had a profound impact. Smuggling has become far more difficult and risky for Iran and its ocean-going enablers.

And yet Iran still goes to extraordinary lengths to conceal illicit shipping commerce (manipulation and spoofing of AIS transponders). This means the list of bad marine actors remains long.

One obvious remedy has been suggested by the classification societies themselves, and it is clear many would like to do more. After all, it is their reputations on the line too. Last month London-based Lloyds Register explained to UANI:

"Our ability to withdraw or suspend class, in accordance with these express terms, is made much easier if a relevant state authority imposes sanctions on the vessel, its registered owner or managing agent having found, based on evidence held by, or presented to, the state concerned, that the vessel has breached applicable sanctions laws."

In other words, more sanctions ought to be levied by the U.S. and other jurisdictions to trigger the declassification of rogue operators. UANI’s directory of vessels operating as Iran’s ‘ghost armada’ must be the first group for sanctions consideration.

The evidence for their rogue behavior is compelling and meticulously documented but in many cases classification societies are hesitant to proceed with declassification. A clear sanctions label for individual ships and their owners and agents – following the normal procedures of due diligence by U.S. authorities – would immediately uncork the bottleneck.

Both Lloyd’s Register and the American Bureau of Shipping (ABS) have taken our alerts seriously to potentially sanctionable activities involving their respective classed vessels by initiating investigations and expelling vessels found to be engaged in smuggling. Last week, as reported by Reuters, ABS declassified two vessels, KARO and ELSA, after UANI’s solicitations. KARO transported over 9 Million barrels of Iranian oil to China in 2021 while ELSA loaded Iranian petroleum on three separate occasions:

"In a Dec. 21 letter to UANI, seen by Reuters, ABS said that after completing an independent investigation it had found "material evidence" that on or about Dec.8 the Elsa had "engaged in illicit transshipment operations with an Iranian tanker" and had as a result cancelled all classification services. ABS said in another letter on Jan. 14 it had completed a separate independent investigation of the Karo and also cancelled all certification services associated with it."

Clearly, many private classification societies are eager to comply with and even augment sanctions regimes, but need the U.S. to do more to enable them to act decisively. Even in the case of ABS, it took several months and rounds of correspondence for the much-needed declassifications.

As well as adding individual sanctions to vessels and their direct owners and managers, we have extensively advocated for the U.S. to broaden the range of sanctionable maritime services. This would permit the U.S. Treasury Department to punish other entities - importing agents, management firms, charterers, operators, marine insurers, vessels and all other “maritime services providers” - directly and willfully found to be helping Iran. Doing so now is more essential than ever. Iran is exporting its oil and natural gas to countries like China and Venezuela at an alarming rate..  Finally and crucially, the U.S. should also encourage other countries to follow its lead and issue guidance for all companies involved in maritime trade, as the U.K.’s Office of Financial Sanctions Implementation (OFSI) has done. Public authorities and private firms, which are evidently keen to support U.S. policy objectives, must work together if we are serious about staunching the illicit flow of Iranian oil.