A Tale Of Two Flag States: Panama And Kiribati

 While Well-Resourced Panama Continues To Serve As The Go-To State For Smuggling Iranian Oil, Kiribati Exemplifies Responsible De-Flagging Of Vessels That Violate Sanctions

(New York, N.Y.) — Last week, the UN’s International Maritime Organization (IMO) elected Panamanian Arsenio Antonio Dominguez Velasco to serve as its next Secretary-General, an unmerited reward given Panama’s dismal record in enforcing penalties on vessels that break IMO rules and evade U.S. sanctions on Iran. This strange choice is yet stranger considering how commendably many smaller states like Kiribaticonsistently uphold safety regulations and enforce international sanctions despite far fewer resources at their disposal.  

On July 11, United Against Nuclear Iran (UANI) notified the Kiribati Maritime Authority of suspected illicit behavior by the Kiribati-flagged vessel SINCERE. The vessel’s Automatic Identification System (AIS) had indicated that on June 11, it was anchored off the Kuwaiti coast. Based on satellite imagery, however, UANI suspected the ship was spoofing its location and was actually in Bandar Mahshahr, Iran, on June 11, where it took on illicit cargo.  

Just 24 hours after receiving UANI’s letter detailing its findings, Kiribati determined in a decisive and responsible fashion to “proceed with the immediate de-registration of the vessel due to violations of U.S. sanctions.” 

By stark contrast, Panama is notoriously slow to act and relies on third-parties for maritime intelligence, despite earning more than half a billion dollars annually as a flag state and having the world’s largest ship registries – more than 20 times larger than Kiribati. UANI has shared evidence with the Panama Maritime Authority (AMP) on the hundreds of Panama-flagged vessels suspected of participating in Iran’s Ghost Armada. However, the AMP, has de-flagged less than 14 percent of the vessels of concern. Relatedly, the Paris MoU on Port State Control now ranks Panama-flagged vessels nearly identically in terms of risk as Iran-flagged vessels.  

Despite years of disregard for the international community's standards, Panama now holds the highest position of power within the organization responsible for setting them. UANI will continue to speak out against Panama’s negligence and urges the AMP to uphold its responsibility to de-flag vessels participating in smuggling operations. 

To read UANI’s report, Oceans of Deceit: Iran's Deceptive Shipping Practices and Exploitation of the Maritime Industry, please click here. 

To read UANI’s resource, Stop the Hop II: The Ghost Armada Grows, please click here. 

To read UANI’s resource, Iran’s Threat to Maritime Security, please click here. 

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