Panama Removes Six Vessels From Its Registry After UK Sanctions

Oil Tankers — Image for representation purposes only

Panama has started cancelling the registrations of six vessels that were recently added to the United Kingdom’s sanctions list.

The decision comes after the new president of Panama, José Raúl Mulino, issued a decree in October that orders the removal of ships that are tied to international sanctions.

Sanctions are restrictions or penalties imposed by one country or group of countries on another country or individuals, often as a way to punish them for certain actions, like illegal activities or involvement in conflicts.

The UK imposed sanctions on these six vessels, which means they are banned from certain operations, and Panama must remove them from its registry to comply with these international rules.

The six ships were added to the UK’s “sanctioned vessels” list on November 25, 2024. Panama, which has the world’s largest ship registry, is now acting immediately to cancel its registrations.

This means the ships will no longer be allowed to operate under Panama’s flag, which is important because Panama’s ship registry is one of the most respected worldwide.

Panama passed a law called Executive Decree 512 in October, which gave the Panama Maritime Authority the power to act quickly. This new rule allows Panama to immediately cancel the registration and licenses of ships linked to sanctions.

Ramón Franco, the director general of Panama’s Merchant Marine, says Panama’s government is responsible for protecting its ship registry and ensuring it’s not connected to any ships that could damage its reputation.

He said, “The state must ensure the well-being of the Panamanian registry by keeping it free from international sanctions and protecting the prestige of our flag,” adding that this is one of the government’s main priorities.

This isn’t the first time Panama has taken such action. Since the decree was introduced, Panama has already cancelled the registration of three other ships and is working on removing eight more.

The UK has been tightening its sanctions on Russia recently, especially on ships of Russia’s shadow fleet. Russia uses these vessels to continue business and transport gas, oil, and other goods despite international restrictions.

This week, the UK sanctioned 30 more Russian ships, bringing the total to 73 vessels under UK sanctions. These ships are crucial for Russia’s economy, as they help transport billions of dollars worth of oil and other products.

Panama’s actions show that it will not allow its registry to be used for ships, which could harm its global standing.

References: Reuters, MarketScreener

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