Cayman Islands: Registration of Ships in the Cayman Islands

Last Updated: 9 February 2006

Introduction

This article summarises the principal legal and procedural considerations relating to the registration of ships on the Cayman Islands Shipping Register. It is not intended to deal exhaustively with all aspects of the subject and proper legal advice should always be obtained before registering or entering into any transaction involving a Cayman Islands registered ship.

The Cayman Islands Shipping Registry

The Cayman Islands Shipping Registry is a Category One British Registry and, as such, is able to register vessels of any size, age and type (except commercial fishing vessels), provided the prescribed quality standards are met. Ships registered on the Cayman Islands Shipping Registry are British ships and, as such, are entitled to fly the Red Ensign. In addition to the registration of many commercial ships, the Cayman Islands Registry has grown to being the largest in the world for yachts over one hundred feet in length.

Qualifications To Own A Cayman Islands Ship

The following persons or entities are qualified to be owners of Cayman Islands ships:

  • Cayman Islands, British, British Dependent Territories and British Overseas Citizens
  • Persons who under the Hong Kong (British Nationality) Order 1986 are British Nationals (Overseas)
  • Persons, other than those referred to above, who are Nationals or Citizens of a Member State of the European Union or European Economic Area, including the Overseas Territories of such Member State
  • Companies incorporated in, and shipping entities established in, a Member State of the European Union or European Economic Area, including the United Kingdom, and having a place of business in any such Member State
  • Companies incorporated in any relevant British possession, including the Cayman Islands, or in any Overseas Territory of a Member State of the European Union or the European Economic area, and having a place of business in such possession or Overseas Territory
  • Foreign companies carrying on business within the Cayman Islands and registered pursuant to Part IX of the Companies Law

For the above purposes the expression "place of business" means the place where meetings of the directors of the company are regularly held, and the expression "shipping entity" includes a "partnership" and a "limited partnership" as defined in the Partnership Law and an "exempted limited partnership" as defined in the Exempted Limited Partnership Law together with any similar entities regardless of where such entity is established.

Registration Procedure

The registration procedure followed by the Cayman Islands Shipping Registry is based on the well established British system and has been amended in recent years, often in advance of similar

amendments in the UK, to provide for a logical and straight forward system. The standard forms required for the registration of a ship are as follows:

  • Form 1 – Application to Register at the Port of George Town
  • Form 2 – Notice of Name Proposed for a British Ship
  • Form 3 – Appointment of Person or Company Authorised by the Owner to sign the Declaration of Ownership (for company owned ships)

  • Form 4 – Declaration of Ownership
  • Form 5 – Declaration of Private Use (if applicable)
  • Form 6 – Undertaking to Mark Vessel for Conditional Registration (see below)
  • Form 7 – Appointment of Representative in the Cayman Islands (if the owner is not resident in the Cayman Islands)

  • Form 7a – Undertaking to act as Representative in the Cayman Islands

In addition to the above standard forms the following documentation is also required to be filed at the Registry:

  • Documents of Title (Builder’s Certificate for a new ship or Bill of Sale for secondary owners)
  • Certificate of Incorporation (for company owned vessels)
  • Certificate of Good Standing (for company owned vessels)
  • Certified copy of Passport (for individually owned vessels)
  • Certificate of Survey (by a surveyor approved or provided by the Shipping Registry)

Once the Registrar is satisfied with all the documentation, a Carving and Marking Note is issued to the owner. The owner then arranges for the vessel to be permanently marked and inspected for verification with the Carving and Marking Note by an approved surveyor, who signs the Note and returns it to the Shipping Registry. The Registrar then issues a Certificate of British Registry along with the Tonnage Certificate.

Carving And Marking

Where a Certificate of British Registry is to be issued prior to receipt of a completed Carving and Marking Note an undertaking must be given to the Registrar by the owner to have the vessel marked with its Port of Registry, Official Number and Net or Register Tonnage within twenty-one days. The Official Number and Net or Register Tonnage must be carved on a plate permanently affixed to the ship’s main beam or other main structural member, where it is clearly visible. However, on pleasure yachts, the ship’s name is not required to be marked on each of the bows.

Provisional And Conditional Registration

In cases where it may be difficult or impossible to effect permanent registration within commercial time constraints, provisional or conditional registration can be arranged. This allows the ship to be registered for a strictly limited period to allow the completion of the full process, and permanent registration is dependent on satisfactory completion of all safety surveys within a specified period.

Provisional registration is a facility that empowers a British Consul or British High Commissioner in a Commonwealth country to issue a Certificate of Registry valid for up to three months or until the ship arrives at a port where there is a British Registrar of Shipping, if sooner.

Conditional registration is processed at the Cayman Islands Shipping Registry and typically provides for the issue of the Certificate of Registry (and recording of mortgage, if applicable) in advance of completing all the statutory surveys or the Carving and Marking. Regardless of such registration, the ship should not leave port until properly marked and certified. Registration of ships under construction is also a form of conditional registration since these ships must pass survey on completion of construction before qualifying for permanent registration.

Mortgage registration is available under the provisional and conditional registration procedures and any such mortgage will remain in effect, even if the conditions for permanent registration are not subsequently met.

Ships Under Construction

Ships under construction may be registered and mortgaged on the Cayman Islands Shipping Registry and a ship may be registered when the keel is laid. Documents for registration will be the same as noted above except that, in lieu of the Builder’s Certificate, documentary evidence of the ship under construction must be supplied. The Shipping Registry will issue a Certificate of Registration Under Construction which is a form of conditional registration maintained on a separate part of the Register. Full registration on completion will depend on the ship meeting the statutory requirements to be able to sail under the Cayman Islands flag.

A mortgage of a ship under construction will be treated and will have the same priority as a registered ship mortgage and will continue to be treated as such until it is discharged, even if the ship under construction ceases to be registered. A ship under construction is treated as maritime property for the purposes of a mortgage.

Demise Charter Registration

Demise charter registration enables a demise charterer to register a ship of not less than 24 metres in length under a flag that is different from where the ship was originally registered by the owner. Matters relating to title, mortgage and other propriety interests continue to be subject to the law of the owner’s country of registration but the nationality of the ship is that of the flag state where the charteror registers it. Demise chartering is a method by which a person can acquire a ship without purchasing it but nevertheless have it registered in the Cayman Islands, which may be beneficial in terms of the commercial operation of the ship.

Mortgages And Security Interests

When a ship is registered under the Cayman Islands flag, a mortgage can be created to secure a loan or other financial obligation by delivering to the Registrar of Shipping for registration an executed mortgage using a statutory printed form. The Registrar will record details of the mortgage on the Register and endorse on the mortgage itself the date and time of registration. Mortgages rank for priority in order of registration and may be in one of two forms, namely principal and interest or account current.

Where a mortgage instrument contains a prohibition against a transfer of ownership, transfer of flag or the creation of further mortgages without the prior written consent of the mortgagee, the Registrar will note such restriction on the Register and will not deal with a subsequent transfer or accept a further mortgage for registration without the written consent of the mortgagee.

There is also provision to record "priority notices" which enables a mortgagee to maintain priority as of the date of execution (rather than registration) of a mortgage and to release funds even though the mortgage is registered as a later date. Priority notices prevent a subsequent mortgagee from gaining priority by registering his interest before the mortgagee who has issued a priority notice is able to register his mortgage. This procedure may be particularly useful in cases where mortgage transactions take place outside the Cayman Islands by adding another layer of mortgagee protection.

Transfer Of Ownership

Where the ship is to remain on the Cayman Islands Register the new owner is required to file the following documentation at the Registry:

  • Form 1 – Application to Register at the Port of George Town
  • Form 3 – Appointment of Authorised Agent
  • Form 4 – Declaration of Ownership
  • Form 5 – Declaration of Private Use (if applicable)
  • Form 7 – Appointment of Representative in the Cayman Islands (if the owner is not resident in the Cayman Islands)
  • Form 7a – Undertaking to act as Representative in the Cayman Islands
  • Bill of Sale
  • Certificate of Incorporation (if the new owner is a company)
  • Certificate of Good Standing (if the new owner company is more than one year old)

If the transferor is a company it should submit to the Registry through its local agent a request to transfer, a certificate of good standing and the written resolutions of its board stating their intention to sell the ship. The original Certificate of Registration should also be returned to the Registry. However, there is no requirement to have another registration survey conducted or to supply the original builder’s certificate.

Fees

The prescribed fees currently payable to the Shipping Registry on first registration of a ship and annually thereafter are set out in the attached Schedule. Please note that, as fees may be varied from time to time, the information contained in the Schedule should be used for guidance only and verified prior to proceeding with any shipping transaction.

SCHEDULE

REGISTRATION FEES

1

First Registration, Registration Anew, Re-registration or Transfer of Registration from one port to where the ship is:

US$

a. up to 150 gross tons

300.00

b. over 150 and up to 400 gross tons

500.00

c. over 400 and up to 1500 gross tons

700.00

d. over 1500 gross tons

1000.00

2

Registration of a Ship Under Construction:

250.00

3

Registration of a Transfer of Ownership, where the ship is:

a. up to 150 gross tons

200.00

b. over 150 and up to 400 gross tons

250.00

c. over 400 and up to 1500 gross tons

275.00

d. over 1500 gross tons

400.00

4

Registration, Transfer or Discharge of a Mortgage, where the ship is:

a. up to 150 gross tons

200.00

b. over 150 and up to 400 gross tons

350.00

5

Registration of a Priority Notice regarding a Mortgage:

75.00

6

Annual Tonnage Fees:

a. minimum fee

100.00

b. per gross ton for the first 1000 gross tons

00.40

c. each additional gross ton above 1000 gross tons

00.14

7

Rush Fees (after receipt of satisfactory documentation)

a. registration within 24 hours

200.00

b. any other documentation within 24 hours

30.00

This facility is offered on a resource available basis only. Where it is not possible to complete a service within the specified time, the rush fee will be refunded.

MARINE SURVEY AND LICENSING FEES

1

Tonnage Measurement survey and issue of Tonnage Certificate and Certificate of Survey, where the ship is:

US$

a. under 24 metres in length

300.00

b. 24 metres and over in length

750.00

2

Application review and issue of a Safe Manning Certificate (SMC), where the ship is:

a. up to 500 gross tons

275.00

b. over 500 gross tons

460.00

SMC for a Sister Ship or near Sister Ship or to vary an existing SMC, where the ship is:

a. up to 500 gross tons

165.00

b. over 500 gross tons

275.00

4

Endorsement attesting to the recognition of STCW 95 Certification:

185.00

5

Statutory Certificates (i.e. SOLAS, Marpol, Load Line, Tonnage, etc.)

230.00

This article is intended to provide a limited overview of the subject matter and is not a substitute for proper legal advice in relation to a particular transaction or proposal.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions