Back to overview
Home Shipbuilding Australia’s Shipping Law Amendments Jeopardize AUD 100 Million Investment

Australia’s Shipping Law Amendments Jeopardize AUD 100 Million Investment

September 4, 2015

Australian-owned Bass Strait shipping company SeaRoad Holdings has warned the country’s Senate that the proposed Shipping Legislation Amendment Bill could jeopardize its plan to invest AUD 100 million in two new cargo vessels, according to the Maritime Union of Australia (MUA).

The proposed bill would replace the existing Revitalising Australian Shipping package from 2013 which included tax breaks and training subsidies for Australian shipping companies, as well as confirming the requirement that foreign-flagged vessels working in Australian coastal waters pay their crews Australian-level pay rates to maintain a level playing field.

SeaRoad Holdings managing director Michael Easy says shipping reforms put in place in 2013 encouraged the company to decide to buy two new ships to work between Tasmania and the Australian mainland.

“It is crucial to our funding arrangements, Tasmania’s future and Australia’s credibility on the world stage that the legislation acknowledges that the current regime be preserved on Bass Strait,’’ Easy wrote in a formal submission to the Senate’s Rural and Regional Affairs committee.

Easy also said in his submission that the 2013 package encouraged SeaRoad Holdings to seek and obtain bank finance to make its AUD 100 million investment in two vessels, the first of which is due to begin operating at the end of 2016.

“Central to these negotiations was the positive understanding that the Australian Government was actively promoting a reinvigoration of Australia’s maritime industry by encouraging direct investment,’’ Easy wrote.

“The proposed legislation will jeopardise this position and is likely to severely impact our current ship replacement plans.’’

SeaRoad ordered one LNG-powered roll on–roll off vessel from the German shipbuilder Flensburger Schiffbau-Gesellschaft (FSG) back in June 2014. The initial plan was for FSG to start the construction of the vessel in September 2015, with the delivery scheduled for late 2016/early 2017.