26 May 2020
Introduction
On 25 March 2020, the Singapore Parliament passed a Bill to amend the Merchant Shipping (Maritime Labour Convention) Act 2014 (the "Act"), which will become law at a later date to be notified in the Government Gazette.
The Explanatory Statement to the Bill sets out the purpose of the amendments, which is:
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To enable Singapore law to give effect to the 2018 amendments to the Maritime Labour Convention 2006 ("MLC"); and
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Where, under a contract of insurance or other financial security, an insurer has paid for certain liabilities owed by the shipowner to the seafarer, to facilitate the subrogation of any right that the seafarer has in respect of the liability, in favour of the insurer.
Should a seafarer be held captive on or off a ship as a result of an act of "piracy" or "armed robbery" against the ship, the seafarer's employment agreement will continue to have effect (during the period of captivity). This is regardless of whether the seafarer's employment agreement has expired or whether either party to agreement has given notice to suspend or terminate it.
Furthermore, a captive seafarer's wages and entitlements must continue to be paid during the period of captivity, up until the day the seafarer is released and duly repatriated, or until the seafarer's death while in captivity. The seafarer's employer is also under an obligation to repatriate the seafarer upon release from captivity.
In circumstances where it is believed that the seafarer has died, a "presumption of death" certificate may be applied for, through the court.
It remains to be seen whether a specific terrorist act will fall within the definitions of "piracy" or "armed robbery", as much will depend on the facts of the case. The term "piracy" is given the same meaning as in the United Nations Convention on the Law of the Sea (UNCLOS), while the definition of "armed robbery" is based on the definition of "armed robbery against ships" in the new paragraph 7(b) of Standard A2.1, incorporated by the 2018 amendments to the MLC.
The Senior Minister of State for Transport has suggested that shipowners may consider taking on additional insurance cover for terrorism instead. Alternatively, seafarers have a right to terminate their employment contracts by giving the appropriate notice, if the ship they are working on is due to sail through a high-risk area.
In addition to enhancing the employment protection for captive seafarers, the amendments provide a statutory basis for insurers to become subrogated to seafarers’ rights where the insurer has paid the seafarer under a contract of insurance or other financial security, for any liability arising from the shipowner’s obligation towards the seafarer (for example, the liability to pay the captive seafarer’s wages and entitlements).
The amendments are timely considering that sea robberies in the Singapore Strait hit a four-year high in 2019, with a grand total of 31 such incidents, is in stark contrast to the 17 reported incidents from 2016 to 2018. In fact, eight piracy attempts in the Singapore Strait have already been reported this year as of February.
It is also to be noted that the Act covers Singapore ships wherever they may be and non-Singapore flagged ships in Singapore waters. Singaporean seafarers on non-Singapore flagged ships would not be covered, although considering many countries are signatories to the MLC, it is likely that these seafarers will be covered under the 2018 amendments if they sail on signatory-state flagged ships or within signatory-state waters.
For further information, please contact:
Ik Wei Chong, Partner, Clyde & Co
ikwei.chong@clydeco.com
