Strikes are frequent in the port of Lisbon. The main point of tension is the legal guarantee for the exclusive use of a unionised labour force by port operators. Port workers argue that the guarantee is essential to safeguard their rights, working conditions and salaries; whereas port operators complain that the protection of port workers and frequency of union action reduce the port's competitiveness.
The Portuguese legislature aims to make the International Shipping Register of Madeira as attractive as possible to banks by protecting their rights as mortgagees. In this context, a decree-law was recently passed to prevent the risk that following the sale of a mortgaged vessel, the mortgagor could force the mortgagee to suffer a loss where the vessel's value is less than the outstanding loan amount.
Under the International Convention Relating to the Arrest of Seagoing Ships 1952, creditors need not convince a court that the debtor is dissipating or likely to dissipate its assets, as is the case when trying to arrest an asset in the Portuguese jurisdiction. As a result, creditors may apply for ship arrests efficiently under the arrest regime regulated by the convention.
The International Shipping Register of Madeira (MAR) is a white-list shipping register with an international focus based in Madeira. It was founded on the principle that the location for the registration of a vessel relies heavily on the will of the banks that finance it. Accordingly, MAR's rules focus on providing the best possible comfort to banks, especially where their rights as mortgagees are concerned.
In July 2014 the Supreme Court clarified the rejection of the Forwarders Act's 10-month time bar. The decision will reduce the complexity of future cases involving forwarders responding to a subcontractor's faults and should help to avoid unpleasant surprises for claimants relying on the one-year time bar foreseen in the Hague Rules.
Portugal has no statutory regime dealing with piracy, either under civil or criminal law. This could cause practical difficulties for a court where, for example, it is required to deal with the consequences of a Somali pirate attack off the Somali coast which is thwarted by a Portuguese warship. In such cases a Portuguese judge's scope of action would presumably be severely limited.
The Lisbon Court of Appeal has confirmed a first instance ruling that an agreement between a shipowner and a ship agent - and any disputes arising from termination of the agreement - are matters of maritime commercial law. The dispute in question fell to be resolved exclusively by the maritime court.
A recent order of the Lisbon Admiralty Court may have paved the way for the arrest of associated ships and piercing the corporate veil in arrest cases. The judge allowed the arrest of associated ships, owned by a company within a group, in connection with a claim relating exclusively to other group companies and to ships that the latter companies owned (or would have owned under the contract in dispute).
A recent report on maritime economic activity has given rise to several proposals to support sea carriage and shipbuilding. In addition, a change to the ranking of priorities for claims in favour of mortgagees will help to improve the competitive position of the Portuguese fleet, while a draft navigation law is likely to facilitate ship arrest in Portugal.
Many owners and insurers of vessels operating in the Portuguese jurisdiction, calling at Portuguese ports or sailing in Portugal's coastal waters are unaware of the importance of presenting a sea report following an incident at sea if damages or compensation may be sought in proceedings in Portugal. Potential claimants and defendants are well advised to follow and intervene in the inquest to confirm such a report.
New legislation has changed the ranking of priorities over Portuguese-flagged ships in favour of mortgagees. Most newbuilds and purchases of ships in service are financed by banks or leasing companies that require owners to flag their vessels in mortgagee-friendly jurisdictions; the recent change aims to halt a 20-year decline in the numbers of Portuguese ships and shipowners.
The Constitutional Court has recently ruled unconstitutional the right to limit shipowners' liability under the Brussels Convention on the Limitation of the Liability of Owners of Seagoing Ships 1957 and the Special Drawing Right Protocol 1979 where the compensation awarded to a claimant from a limitation fund is so low as to breach the constitutional right to fair recovery of damages.
A Supreme Court decision underlines the importance for registered shipowners, when bareboat chartering their vessels, of incorporating adequate protection against the consequences of their counterparty's insolvency. The case also demonstrates that a registered shipowner can be considered subsidiarily liable for a bareboat charterer's navigational breaches.
The interpretation of Article 29 of the Convention on the Contract for the International Carriage of Goods by Road varies between jurisdictions, particularly in respect of the degree of fault and the link with the limitation of liability provisions in Article 23. This update explains the position under Portuguese law and illustrates it with recent judgments.
A recent case involving a Portuguese ship leasing company shows that ship finance institutions must be careful when contracting with clients under financial leasing contracts for ships, in particular to guard against the possible insolvency of both the corporate clients and their directors. The nature and terms of the security required must be carefully chosen.
The substantive requirements for the arrest of ships in Portugal are determined by international convention and national law. This update considers the procedures for applying for arrest, opposing or appealing an arrest order and pursuing subsequent main proceedings.
A recently passed piece of legislation, Decree-Law 370/2007, introduced new rules aimed at facilitating maritime traffic to and from Portuguese ports. This has been done by simplifying the administrative processes used by the relevant authorities when ships call at or sail from Portuguese ports.
A limitation period for the enforcement of a claim under the Convention on the Contract for the International Carriage of Goods by Road cannot be interrupted, extended or suspended by agreement or in a statement by the debtor, as the limitation period is considered a prescription limitation period and therefore can be extended only by admission or by the service of papers on the defendant.
Portugal has modified the rules on the nationality of seafarers who are eligible to crew ships registered with the Conventional Registry under the Portuguese flag. The crew member in command of such ships is no longer required to be of Portuguese nationality and may be a national of any EU state except Bulgaria and Romania, the newest members.
The threat of terrorist action has highlighted the vulnerability of ships, port facilities and other maritime interests around the world. Portugal's implementation of the International Code for the Security of Ships and of Port Facilities is part of a detailed framework of port and shipping security measures which involves the cooperation of a number of different entities.