Greek Shipping News Cuts
Week 11 - 2004


Tasman Spirit case shows need for new guidelines

---THERE was a time when certificated ships' officers could know fairly well what would happen if they got things badly wrong or, more specifically if they caused the loss of life or of a ship.
They would face an official inquiry and could lose their certificates, and thus their livelihoods. There always was the possibility of criminal or civil actions for negligence but, a generation or so ago, these were very rare.
A major reason for an official lack of enthusiasm for pursuing criminal negligence cases was that accidents tend to be the result of misjudgements rather than deliberate recklessness.
For example, bridge watchkeepers have to make judgements all the time based on their experience, knowledge of the International Collision Regulations and their appreciation of the existing situation. Sometimes, they will get it wrong, and very occasionally the results will be literally disastrous.
What a different world we live in now. Inquiries still take place and are still primarily aimed at discovering why an accident happened and identifying ways of preventing similar incidents in the future.
But the ship's master officer nowadays knows that he is in the legal firing line if anything at all goes wrong. Criminal negligence cases are now common as are prosecutions for deliberate flouting of environmental regulations.
In principle, there is nothing wrong with prosecuting in cases of blatant negligence or deliberate pollution. The danger though is that this creates a mindset that assumes every accident must be the result of criminal negligence.
And in today's global industry there is already very much a culture of blame, primarily towards seafarers and to a lesser extent towards companies. This has led to a situation where the first reaction of some countries faced with shipping accidents has been to arrest the masters and officers involved. In recent years, France and Spain have taken this approach.
Where there is clear evidence of criminal negligence on the part of individuals and the judicial process is tolerably swift and is seen to be transparent and fair, it is difficult to complain about the use of the criminal law. The prosecution of two tanker masters involved in a collision off Singapore a few years ago and some recent cases before the UK courts come to mind.
The problem, however, is that it is close to becoming standard procedure to throw crew members into jail after an incident, often where charges are vague and evidence of wrongdoing scanty.
As many in the shipping industry will be aware, there is a really bad example of this worrying trend at present. The tanker Tasman Spirit ran aground off Karachi, Pakistan, last July and eventually broke into two in August, spilling about 28,000 tonnes of crude oil.
Following the accident, which occurred when the ship was being conned under the advice of a local pilot, four Greek and three Filipino seafarers were accused of negligent navigation and of endangering lives. A Greek salvage master whose team managed to recover 38,000 tonnes of oil from the tanker has also been prevented from leaving Pakistan as have the salvage vessels and equipment.
Pakistan is demanding compensation for environmental damage of US$1 billion. The ship's manager, Greek company Polembros Shipping, blames the Karachi Port Trust for the accident. It says it may use the British courts in an attempt to seize Pakistani assets abroad to force the crew's release.
International pressure is building up on Pakistan. Last month, the secretary-general of the International Maritime Organization (IMO), Efthimios Mitropoulos, offered his 'good offices' to Pakistan on humanitarian grounds.
In his intervention, Mr Mitropoulos stressed the humanitarian angle and also drew attention to his concerns about the effect on other seafarers and on recruitment of youngsters. The IMO says that there has been no response from Pakistan.
Other interventions have been blunter. A special maritime safety committee of the European Parliament and the Greek government have called for the men's release as has the salvors' organisation, the International Salvage Union.
The Tasman Spirit case is causing concern for several reasons. There is a clear need for an impartial enquiry into the incident, following IMO guidelines, to ascertain the facts. This has not yet happened.
When an accident occurs with a local pilot on board the apportionment of responsibility, and possibly blame, can
Source:, 10 Mar 04

Kefaloyannis and Pavlidis named to key shipping portfolios
---Prime minister Costas Karamanlis named Manolis Kefaloyannis, a 45-year-old economist, Marine minister in Greece's in-coming New Democracy government. The London School of Economics post graduate lacks experience in shipping but said: "I am honoured to have this ministry. Greek shipping is the basic financial support of the national economy."
Kefaloyannis has held a seat in parliament since 1990, representing the Iraklion constituency on Crete. He served as shadow Culture minister, a position Karamanlis himself has now assumed. Kefaloyannis will need time to be briefed on the matters of his portfolio, but there is continunity as his uncle, also Manolis Kefaloyannis, occupied the Piraeus portfolio when the PM's uncle, also Constantinos Karamanlis was himself PM, some 25 years ago.
ND's election manifesto pledges changes to shipping policy and shipowners hold cautious hopes ND will make a better fist of the task of improving the competitive position of Greek flag than did the outgoing socialists, who seemed drained after the European Union presidency, first half of 2003. Details of how this is to be done have not been made clear.
Karamanlis told a gathering of Piraeus industralists and shipowners last month that a competitive flag will mean more ships under it and more jobs for Greek seafarers. ND has pledged seafarers are to be given immunity from taxation, and the monopoly of state-run colleges in training merchant marine officers is to be ended. The new government plans to look again at legislation governing a listing on the Athens Stock Exchange in a bid to stimulate more interest from the shipowning community, and it wants to boost competition at Greek ports by encouraging independent stevedores to bid for cargo handling work.
The man with whom Kefaloyannis will most closely work to ensure the efficient operation of the domestic seatransportation network is Aristolelis Pavlidis, the last ND Marine minister, a decade ago. An MP from the Dodecannese islands group, Pavlidis was the minister who gained for Greece a decade of breathing space, before cabotage was lifted in the Greek ferry market January 1 this year.
Source:, 10 Mar 04

Bulker safety sceptics die hard
---Greece has commissioned a new report that rubbishes the UK Maritime and Coastguard Agency s influential three-year study of bulk-carrier safety.
The 250 pages of research produced by Scotland s Strathclyde University form part of a Greek-led attempt to block mandatory double hulls. The International Maritime Organisation (IMO) has followed UK recommendations to mandate double hulls for bulker newbuildings.
A copy of the report seen by TradeWinds dismisses UK claims that double hulls will offer operational advantages and cost savings as well as improved safety. It alleges that the UK cost calculations are based on dubious assumptions of an unaccountable and controversial nature . It concluded: The double side skin is certainly not a cost-effective solution to address the risk of side-shell failure. The gross cost of averting a fatality is likely to be much higher than $3m.
Under the formal safety assessment (FSA) method, recommendations are usually considered when the average cost of averting a fatality is less than $3m.
The Greek report calculates that the cost of adding a double side skin on a capesize is $4.8m but will only produce $401,000 in operational cost benefits.
The Strathclyde University researchers believe that not enough consideration has been given by the UK to the loss of cargo that double hulls will entail or the increased fuel consumption.
There are also claims that double hulls will be more prone to fatigue and corrosion and inspection will become more difficult.
Instead of a double hull the Greeks are proposing an increase in corrosion margins, coatings control and enhanced corrosion allowance including early replacement of side frames. The Greeks estimate that these measures will put the cost of averting a fatality at about $1m.
The Greeks intend to put their arguments to the next Maritime Safety Council meeting at the IMO in May to persuade flag states to reverse their decision to make double hulls mandatory for bulk-carrier newbuildings.
The UK, which has been championing the cause of bulk-carrier safety since the 1980 Derbyshire accident, is likely to defend the double hull requirement, which it strongly believes is the best way to reduce casualties.
Source: www.tradewinds,no, Adam Corbett London, 12 Mar 04

Ferry firms heartened by 2003 results and debt rescheduling
---Listed ferry operators achieved a measure of financial recovery in 2003, after several years of difficulties arising mainly from an expansion drive in the 1998-1999 period.
The sector's five listed companies reported a combined operating revenue of more than 800 million euros in 2003, about 100 million more than in 2002, according to data in the study "Greek Coastal Shipping 2003-2004: A Restructured Course," by XRTC, the shipping consultancy arm of Credit Lyonnais. Their average profit margin before tax, interest and amortization (EBITDA) rose about 2 percent.
The data reveal that despite the sector being in what is still regarded as a transitional period, all financial indicators improved in 2003. Strintzis Lines, which reported EBITDA margin of 24.5 percent, the lowest among all five, had the best liabilities to current assets ratio. This translates into a relatively good level of profitability and a satisfactory picture of debt liabilities in relation to current assets.
By contrast, Lesvos Maritime Company (NEL) has huge debt liabilities in relation to current assets, although it reported the highest rise in profitability, 28.1 percent. The picture is similar for Minoan Lines, which also has a high liabilities to current assets ratio (2.66) and a relatively good rise in profitability (26.9 percent). Attica Enterprises (EPATT) accounted for 309.6 million euros of the combined 800 million turnover of all five.
ANEK improved both its profitability from 24.3 percent in 2002 to 25.1 percent in 2003 and its debt to current assets ratio, from 2.04 in 2002 to 1.90 in 2003.
Minoan Lines reported a significant rise in turnover but without a commensurate increase in the profit margin. Additionally, a small rise in borrowing caused a deterioration in its debt to current assets, from 1.89 in 2002 to 2.66 in 2003.
All five companies recorded an increase in the volume of business in domestic and foreign routes alike, on the basis of data for the first nine months. On domestic routes, the five companies carried a combined 6 million passengers; on the Adriatic routes (where NEL does not operate) the four firms have recorded a 31 percent rise in the volume of business in the last two years, 2002 and 2003. This smaller market segment nevertheless yielded satisfactory profitability, given that fares are fully deregulated. EPATT's SuperFast Ferries also operates successfully in Baltic and North Sea routes.
Finally, the five listed ferry operators have achieved a sharp rise in the number of vehicles carried since 2001.
The restructuring of the huge debt load of the five firms has been a long and painful process which seems to be nearing completion. During this process, they were burdened with compound interest and other expenses, which worsened their position.
Giorgos Xiradakis, XRTC's managing director, considers that ANEK and NEL have managed to significantly lighten their debt repayments in the next five years. Minoan Lines is still in negotiations with banks which are expected to be completed soon. The restructuring boosts banks' role as regulators in the industry, as they will have to approve any further business plans for expansion.
By Nikos Bardounias
Source:, 11 Mar 04

Royal Olympic says cruise ships to be auctioned
---MIAMI, March 10 (Reuters) - Royal Olympic Cruises, a small, struggling cruise operator, on Wednesday said its ships Olympia Explorer and Olympia Voyager would be sold at judicial auctions in Florida and California.
Based in Piraeus, Greece, Royal Olympic Cruises said the ships would be sold under an agreement among the company, the subsidiaries that own the ships and creditor banks. A Greek court recently appointed a mediator to resolve differences between the company and creditors.
Royal Olympic Cruises said in a news release that it does not expect to receive any money from the auctions set for March 24 in Long Beach, California, and March 26 in Miami. The ships were ordered sold after the subsidiaries sought U.S. bankruptcy court protection.
On Monday, Royal Olympic Cruises said its ship MV Triton had begun a series of three-day and four-day cruises but cautioned it had not yet secured working capital to cover all of its summer operations.
Leading cruise operators such as Carnival Corp/Plc have been adding new ships to their fleets and, in recent months, have reported strong improvements in bookings and prices.
Source:, 10 Mar 04

Festival claims plan is accepted
---FESTIVAL Cruises said today that its restructuring plan, which hinges on a proposal from an undisclosed investor, had been accepted by Italian and Greek banks. The company will meet representatives from Credit Agricole Indosuez and Alstom in the next few days to give details of the plan and define the terms for release of the vessels Mistral, European Stars and European Vision, which are still being detained. However, rumours coming from Barbados say the European Vision is to be auctioned on Monday. Brokers told Fairplay that Festival's three modern ships, if finally sold at auction, are likely to be purchased by their mortgage holders to be chartered or resold. Speculation suggests that the 2001-built European Vision and 2002-built European Stars, both of which cost EUR300M, could be sold by Credit Agricole Indosuez to MSC Crociere Italiane for about EUR270M ($333M) each. Festival's Flamenco was recently sold to newcomer Elysian Cruises, and earlier this week broker JE Hyde acquired The Azur and Bolero at auction in Gibraltar on behalf of undisclosed interests.
Source: Lloyd's Register - Fairplay web links, 12 Mar 04

Alafouzos tanker company to debut on Athens Exchange
---A change in the political landscape in Greece appears to have moved Alafouzos shipping interests a significant step closer toward being the first publicly traded bulk shipping company on the Athens Stock Exchange. The group is planning to "increase its share capital, through a public offer, by the amount of 10,197,200 euros through a rights' share issue, and the issue of 10,197,200 new common registered shares the price of which will be determined based on valuations of the vessels - not multiples of earnings or cashflow. Underwriters of the deal are National Bank of Greece S.A. and Piraeus Bank.
For those that haven't been following the drama closely, the first shipping listing comes after nearly three years of sometimes-heated discussion between government regulators and the private sector about listing requirements and restrictions. Alafouzos-controlled media company Kathimerini S.A. moved into shipping when a subsidiary acquired two
1997-built aframax tankers, Therassia and Okeanis from a related party in 2001. At the time the deal was done the two vessels, which were time-chartered under a three-year agreement to Exxon Mobil at $25,200 per vessel, were valued at $84-85 million by Clarkson and Platou Shipbrokers. The deal was financed with cash and a loan from Credit Agricole Indosuez and Kyklades Maritime Corporation, which is controlled by Mr. Aristeides Alafouzos, the Chairman of the Kathimerini board, manages the vessels.
Although Alafouzos told Marine Money's Ship Finance Forum Greece in 2002 that the company was keen for the listing, some people that we have spoken with in Greece indicate that the listing may be the result of the fact that regulators are ill at ease with the idea that a publishing company is largely supported by the earnings from oil tankers. A look at the 2003 financial results tells the story. On consolidated basis, the group's turnover increased by 22% to 51.67m euros and profits rose to 2.41m euros from 1.88m euros in 2002. The shipping subsidiary played a huge role with turnover rising by some 15.5% to 23.9m euros compared to 20.7m euros last year, while net profits after tax amounted to 10.4m euros from 8.9m euros in 2002, up by 17% and nearly comprising the group's entire profit.
Source:, 12 Mar 04

Lloyd's Register first to sign new agreement with Hellenic Republic
---Lloyd's Register has become the first classification society to sign a new agreement with the Hellenic Republic covering delegation of statutory services to a recognised organisation (RO). The new agreement provides a significantly higher degree of delegation and includes certification for passenger ships, the International Ship and Port Facility Security Code and ships engaged exclusively on domestic voyages. The agreement between the Hellenic Republic and Lloyd's Register represents the first time that the Greek maritime authorities have entrusted statutory certification of the country's domestic ferry fleet to an international RO.
At the signing ceremony, Alan Gavin, Marine Director of Lloyd's Register, said: "Lloyd's Register is honoured to be the first classification society to sign this new agreement with Greece. The Greek-controlled fleet is the most significant in Europe, at almost 90 million gross tonnes. We will continue to work closely with the Greek administration and shipowner associations to raise the quality of ships flying the Greek flag. Today's signing will allow Lloyd's Register to accelerate the ISPS certification of the Greek fleet, as well as expanding its role into the certification of passenger ships, both international and domestic."
Vice-Admiral Delimichalis Christos, Commandant of the Hellenic Coast Guard, said: "The signing of this agreement between the Greek Ministry of Mercantile Marine and Lloyd's Register will be mutually advantageous and will promote marine safety and the protection of the marine environment. I believe that together - ourselves on the administrative and legislative level and Lloyd's Register on the technical and service-provision level - we can contribute positively towards the future development of the worldwide shipping industry."
Lloyd's Register classes 28% of the Greek-controlled fleet, comprising some 880 ships totaling 25 million gross tonnes, with 133 ships on order. In addition, Lloyd's Register is the market leader for Greek-flag ships, with a market share of 33%, representing 9.8 million gross tonnes.
Source: Lloyd's Register, announcement, 10 Mar 04

EVENTS DIARY (Piraeus/Athens)
News and Announcements are welcome at:
Bulk Carrier - Hull Inspection
Date: 23 March 2004, DNV Maritime Service Centre Greece
Course description is available at
For more details, please contact Ms. Vassilia Dimitrakou, Det Norske Veritas, Tel: 210 4100 200
Date: 31 March & 1 April 2004, Inter-Continental Hotel Athens, Greece,
Organiser: Hazlis & Rivas Co. Ltd, Tel. (+30) 94 08 750-2, Fax (+30) 94 08 753,,
Posidonia Cup - Friday 4 June 2004
Venue: Faliron Bay, Athens - Piraeus
Posidonia Congress - Monday, June 7 2004 (morning)
Venue: Piraeus Port Authority, Conference Centre
Exhibition - Opening Ceremony - Monday, June 7 2004 (evening)
Venue: Piraeus Port Authority Exhibition Center
Exhibition - Tuesday, June 8 2004 to Friday, June 11 2004
Venue: Piraeus Port Authority Exhibition Center
Information: Posidonia Exhibitions SA,
Date: 14 October 2004, at Athens Ledra Marriott Hotel
The 2003 forum attracted a total of 162 individuals during the day including presenters. From our records this includes 48 shipowners and shipowers representatives, 54 bankers and financiers, 13 lawyers and many others besides. That is substantially better in numbers and in quality than any other comparable conference in Greece.
For the 2004 conference, the organisers expect nothing less, so make your plans now.
For more information please go to or contact Marine Money Greece at: Tel: +30 210 9842 136, 210 4190 164 E-mail:
Digital Ship Athens
Date: 2-3 November 2004
Conference: Maritime software, satcoms, electronics
Digital Ship Ltd, Tel (+44 207) 510 4935, Fax (+44 207) 510 2344,,
Source: Organisers Announcement