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Arbitral Tribunal renders Award in favour of Malta in proceedings concerning Maltese-registered ship

14 September 2016

On 22 October 2013, Malta had instituted arbitral proceedings against the Republic of São Tomé and Príncipe under Article 287 and Annex VII to the United Nations Convention on the Law of the Sea (UNCLOS) in respect of a dispute concerning the Maltese-registered vessel mv Duzgit Integrity.

Following an exchange of written pleadings and a hearing at the Permanent Court of Arbitration at the Peace Palace in The Hague, on 5 September 2016 the Tribunal constituted in terms of UNLCOS issued an Award in respect of the said dispute. The Tribunal found, unanimously, that it had jurisdiction over the dispute and that Malta’s claims were admissible.

The dispute concerned the arrest by São Tomé of the Maltese registered ship when it attempted to undertake a ship-to-ship cargo transfer in São Tomé’s archipelagic waters, and the subsequent measures taken by São Tomé in relation to the vessel, its master, cargo, owner and charterer.

The Tribunal determined that Article 49 of UNCLOS, which relates to the exercise of a State’s sovereignty over its archipelagic waters, was applicable. The Tribunal noted that, under international law, enforcement measures taken by a coastal State in response to activity within its archipelagic waters are subject to the requirement of reasonableness, which encompasses the general principles of necessity and proportionality. The Tribunal found that the initial measures taken by São Tomé fell within the exercise of its law enforcement jurisdiction.

The Tribunal, however, found that the other penalties imposed by São Tomé – the prolonged detention of the master and vessel, the monetary sanctions, and the confiscation of the entire cargo – when considered together, could not be regarded as proportional when considering the original offence or the interest of ensuring respect for São Tomé’s sovereignty. The Tribunal found, by majority, that the disproportionality was such that it rendered the cumulative effect of the sanctions incompatible with the responsibilities of a State exercising sovereignty on the basis of Article 49 of UNCLOS. Consequently, the Tribunal held, by majority, that Malta was entitled to claim reparation regarding certain heads of claim in a later phase of the arbitration.

This case has highlighted the commitment of the Maltese Government, particularly through Transport Malta, as a leading flag Administration, to afford the necessary support to operators operating their ships under the Malta flag. This has continued to provide the necessary assurance to shipowners of the firm commitment and support of the Malta flag Administration afforded to their operations.

The full details of the Tribunal decision may be found at: https://pca-cpa.org/en/news/the-duzgit-integrity-arbitration-the-republic-of-malta-v-the-democratic-republic-of-sao-tome-and-principe/