Positive And Negative Sides Of A Bare-Boat Charted Fleet

During the years of democratic reforms the Russian fishermen have faced an urgent necessity of fleet renewal. While everyone around was adsorbed with incorporation, property division and invention of a Russian type of the market, the ship wear became critical and any delay would mean a catastrophe. It turned out impossible to renew a fleet in conditions when domestic industry and banking system collapsed. Fishermen had to look for a way out from the dead end themselves, and they did it. Vessels bought on the installment plan on terms of a bare-boat charter appeared in the northern basin. Fishermen tend to pay for it with fish products; even foreign partners name this fleet renewal scheme as a disguised sale of Russiaís quotas.
By now Murmansk fish producers have at their disposal 37 vessels of such kind, and their amount is likely to enlarge. Whether this type of charter is effective in renewing the fleet, why the ship owners choose this method and what problems it has brought to fishermen, all this is discussed by specialists.
Gennadii MAKIDONOV, the Head of the State Administration of the Murmansk Seaport:
— The age of bare-boat charted vessels makes me be cautious. Only five of thirty-seven ships were built less than ten years ago. The age of the rest is 20-30 years each. I believe, in several years when they pass into ownership of our ship owners they will become scrap metal. Even so, when such vessel calls at home port it has to pay duties in full. Thatís why it is necessary to cut customs for bare-boat charted vessels when they call at home ports as it may help bring the coast back to life. But I personally worry about something else. The State Fisheries Committee used to control the amount of ships fishing in the basin due to bioresources available. Now they act less resolutely, more over there is no age limit for vessels bought. Faint attempts were made by the RF State Fisheries Committee some years ago. A specific regulation was issued then, which confined age of bare-boat vessels to 18 years. Though it had some legal flaws and later it was appealed. And now we reap the fruits. Even if they introduce age limit for bare-boat charted vessels we cannot evade one delicate problem: if we purchase reliable vessels with great productivity, in some years we will come to a situation when, proceeding from our quota, few modern trawlers will be enough to work in the basin. Then weíll have an army of unemployed fishermen and it may result in social discontent. How to make a reasonable solution out of it is not clear yet. But it must there be.
Alexander TUGUSHEV, the Head of the Murmansk Trawl Fleet-3 Co.:
— As for problems connected with bare-boat charted vessels, we should speak of them in a roundabout way. The matter is, and every child knows about it, that almost 95 per cent of fishing-boats for the former Soviet Union was built abroad Ė in Poland, Holland, Denmark, Germany. A part of them came from Baltic republics and the Ukraine. After the well-known events we found ourselves, so to say, in an interesting condition: we had no shipbuilding industry, but boats had to be exploited, repaired and built. And more, we have a very complicated tax legislation, which prevents solution of these problems. Customs take a lot of money for crossing the Russian border by a vessel repaired abroad in docks where it has been built. It may seem that levying such heavy taxes our beloved state intended to make ship-repairing yards busy. Itís not true. Bringing spare parts from overseas will set us back a bit, as maximum customs fees and duties are imposed on them. Thus the present tax legislation led to the breakdown in ship repairing service: Russian boats are repaired mostly in other countries.
And now about the problem of fleet renewal. Each fishing company planning its further development has faced difficulties. The question at issue is how to solve the them if the state doesnít wish to invest money into it. Of course, you may go to a bank and take a long-term credit, and itís done. But, alas. There is no sense speaking about Russiaís banking system. To take credit in a Russian bank means to sentence your business to death penalty. All this became a reason for a bare-boat charter as a way for ship owners to renew their fleets. They resorted to it driven by poverty. Itís the only cause, which made us buy used boats abroad. The choice of ships of a certain age is determined by the ability of a particular ship owner or an enterprise to pay for a vessel. Although I donít want to dramatize it. The notion ęvessel ageĽ is quite relative and witnesses to nothing. Itís just Russia, where outdated ships need complete overhaul, though in other countries they are updated. Only the hull age of foreign vessels corresponds to that of a ship, the rest keeps abreast of the time.
The main problem of a bare-boat charter is in tax legislation: it is unreal to pay one-time duties of 25 per cent of its cost for the first call at homeport; to change the situation one needs to abolish draconian fees and taxes. The payment should be reduced to reasonable limits and be made in installments for several years. Still now we are doomed to work outside homeports. Does our economy have any benefits from it? I donít know. A scheme of bare-boat fleet renewal is bad in itself as it works for the economy of foreign states, and foreign investments are behind it. But we have no choice.