Government plans cabotage provisional measure

With the aim of increasing cabotage transportation, the Ministry of Infrastructure is planning a provisional measure that wants, among other measures, to allow the operation of flagship vessels from other countries in order to reduce the cost of this type of transportation.

Currently, EBN (Brazilian Shipping Company) can operate with its own vessels or with foreign chartered vessels that suspend its flag, which means that the external vessel will be configured as a Brazilian vessel, thus following the rules from Brazil.

With the cabotage provisional measure, foreign ships will be able to operate in cabotage without suspending the flag. To do this, EBN would have to create a foreign subsidiary and charter the ships of this foreign company, filling two thirds of the crew with Brazilians.

However, there is a controversial point in the proposal: to reduce costs, the subsidiary could settle in a country where there are not many requirements to register ships, the so-called “flag of convenience”. This is similar to what companies do in tax havens, but in shipping, which is common in countries like Liberia and Panama.

Once this problem is solved, the expectation is that cabotage transport will gain more competitiveness.

Sharing is caring!