Cyprus and Greece are well known active seafarers from ancient times when they dominated the waters of the Mediterranean Sea. They used ships not only in warfare but mostly in trading and travelling, thus creating colonies and expanding their financial and cultural exchanges with other civilisations and countries.
In the early 1960s, Cyprus and Greece launched their sea connection with ships arriving from the port of Piraeus to the ports of either Limassol or Famagusta. Ships used to continue their trip to Haifa, in Israel, possibly to Beirut in Lebanon and Alexandria, in Egypt.
The sea connection between the two countries was suspended in 2000 as people and businesses opted using other means of transportation due to the advancements of technology which were cheaper and faster. As a consequence, the Cyprus-Greece port-by-port had become unprofitable for ferry companies because of reduced passenger traffic.
During the summer of 2019 though, and after months of discussions with the EU's DG Competition, the Shipping Deputy Ministry of Cyprus, managed to secure the approval for a maximum state aid of €5 million per year in order to reinstate the Cyprus-Greece ferry connection. In addition, the European Commission pointed out that the sea connection between Cyprus and Greece is of great economic interest and that under the EU current rules it could be supported with government funds.
On 12 December, 2020, the Cyprus Shipping Deputy Ministry (SDM) announced the launch of a tender process to reinstate a maritime passenger link between Cyprus and Greece, subsidised by government funds.
Tender No. 13/2020 was launched by the Shipping Deputy Ministry of Cyprus following the approval by the Directorate General for Competition of the European Commission in June 2020. Passenger maritime transport services between Cyprus and Greece constitute a Service of General Economic Interest (SGEI) that is why the venture will be subsidised, by national funds, to the value of up to €5 million per year, for the 36-month contract.
It is required by interested shipowners and charterers who are planning to submit for the specific tender to have a ship capable of carrying both passengers and freight. The Ro-Pax vessel must comply with various requirements which include the flying of an EU/EEA flag appearing on the Paris MOU White List, a minimum capacity of 200 passengers (cabin capacity of 140 in case the trip duration will be longer than 16 hours), and must comply with all international, community and national rules and regulations in respect of safety, security, and environmental issues – at all times.
The deadline for tender submissions is the 29 January, 2021 at 12:00 p.m. Interested shipowners and charterers can find further details regarding the tender and process of application, here
At Michael Kyprianou & Co LLC, we know about shipping and we have a passion for the sea and an appreciation to the unique way in which it serves the world. Our team is available and ready to offer support and legal advice on how to fulfil and submit the above tender aiming for the best possible results.
The ultimate aim of the Shipping Deputy Ministry is to launch the route in May 2021. The route will connect Limassol or Larnaca port with the port of Piraeus with the possibility of an intermediate stop in a Greek island port on the way to Piraeus and vice versa.
It is expected that during the summer months which are May until September, the itinerary will be conducted once a week while during the winter months which are October until April, once in a fortnight. Without a doubt this route will enrich the available means of transport and it will create a new market segment for consumers/travellers to and from Cyprus and Europe. Of course, the frequency of the route will be reviewed based on demand.
Furthermore, the government of Cyprus will only be financing the cost of carrying passengers, ensuring that the subsidy is not exploited by the shipowner to subsidise cargo. That is why all documents in regard to the project have been drafted so as to comply with EU regulations thus ensuring that the cost of transferring the passengers only and not the cargo, is covered by the subsidy. In this way it will be ensured that no unfair competition is created while overcompensation is avoided.
The maximum cost of a ticket will be €50 for the one-way route whereas for a return ticket the cost will be €80. The cost for a cabin for one-way tickets per person is €80 and €120 per person in a cabin for return tickets. Children under two years of age will travel for free, while children under 12 will pay a reduced fare. The cost for vehicles of up to five metres will be €75 for the one-way route and €150 for return tickets. Motorbikes will cost €50 for a single ticket and €100 for a return ticket. Port fees, which will not be included in the ticket price, may indicatively range between €20 and €30.
The project will not only strengthen Cyprus' connectivity with Greece but also with mainland Europe. This will assist in the creation of a new market both for travellers and shipowners. There are new maritime horizons to and from Cyprus and Europe opening and it is about time we make good use of them for the benefit of our country.
Originally Published by Michael Kyprianou, December 2020
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.