COVID-19 And Its Impact On The Shipping Industry – Coronavirus (COVID-19)

Cyprus:

COVID-19 And Its Impact On The Shipping Industry

International trade and shipping play a key role in the
transportation of essential supplies, foods and other necessities,
a role which becomes even more significant during the ongoing
COVID-19 pandemic.

Nonetheless, the lockdowns and restrictions on entry imposed by
many countries are causing a severe disruption to the industry
while reduced manufacturing activity greatly affects shipment
volumes and traffic.

The outbreak of COVID-19 almost coincided with the long-awaited
2020 Sulphur cap, which was forecast to cause short-term
uncertainty in the industry. While some countries, in an effort to
mitigate the impact on supply chains, elected to delay the
implementation of the 2020 Sulphur cap, the shipping industry
remains under high pressure which is expected to continue for some
months.

The cumulative effects of the pandemic on the shipping industry
and the consequent insurance and legal implications of the
disruption have yet to be clearly determined. As BIMCO stated,
“the industry [shall] be pragmatic and work together to find
solutions. Not every answer will be found in the contract and
parties should do their best to communicate openly about the issues
they face and identify compromise solutions to find a way through
these difficult times.”

In Cyprus, the Deputy Ministry of Shipping (DMS) reacted
immediately and offered support and guidance to the shipping
companies and owners of Cyprus-flagged vessels. The DMS remain
fully operational and, as stated on its website, “continues to
provide its high-quality services without any disruption, so that
all ships registered under the Cyprus flag will continue to operate
as usual”.

Circular 9/2020 issued on 9 April 2020 purports to support
shipping companies and owners of Cyprus-flagged ships by mitigating
the impact of the COVID-19 outbreak. The circular contains DMS
published instructions concerning the restrictive measures
implemented by both the Cyprus Ports Authority and
Contractors/Operators/licensed agents for port services and port
installations during the pandemic. The announcement can be found
here.

Furthermore, the deadline for the payment of the tonnage tax for
Cyprus-flagged ships, as well as the Register of Cyprus Ships’
annual maintenance fee for the 2020 tax year, have been extended
from 31 March to 31 May 2020

Overall, at a time when the industry was preparing to undertake
a more green approach, maritime stakeholders are now having to
consider the wider implications of the pandemic, whilst continuing
retaining the positive steps have already been taken towards the
preservation of the environment.

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.

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