SeaIntel: Container Shipping Industry Favours Tax Havens

Over the past 30 years, there has been a constant shift toward registering container carriers in countries dubbed as tax havens, according to the findings released by SeaIntel Maritime Analysis.

The container shipping market data provider said that it has used the report: “Tax Havens: International Tax Avoidance and Evasion” published on January 15th, 2015 by the US Congressional Research Service, for its analysis. As disclosed, the report contains a list of 50 countries listed on various tax haven lists with 26 of these having container vessel tonnage registered.

A revised list, which no longer considered some countries as tax havens, brings the list down to 17 countries which have container tonnage registered.

According to SeaIntel, if an analysis is made of the developments based on the full list of countries listed as possible tax havens, it can be concluded that “there has essentially been a constant shift towards tax havens throughout the entire period from 1980 to 2017, from 12% of tonnage flagged in tax havens in 1980, to 74% in 2017, the majority of which were registered in Liberia and Panama.”

However, when considering the reduced list to re-calculate the share of container vessel tonnage registered in a tax haven,  a break in the trend can be noticed with the peak being in 2013 where 58% of the tonnage is registered in tax havens, now down to 53% in 2017, SeaIntel said.

“This is clearly a different view of recent developments than the one presented in the first figure, and the sole difference is in terms of which countries are – and are not – defined as tax havens.”

“Whether the industry’s decades-long trend of increasingly favouring tax havens have been broken or not, depends on the more subjective political determination pertaining to a few individual countries. However, even in the most positive light, the conclusion must be that in the period 1980-2010, the registration of container vessel tonnage was systematically favouring a shift towards countries often labelled as tax havens. Depending on how such countries are defined, the trend may or may not be broken, but even if it has been broken, the reversal of the trend is very small indeed,” SeaIntel CEO, Alan Murphy said.

The analysis has been released on the back of a major stir caused by the so-called Paradise Papers, a global investigation that reveals the offshore activities of some of the world’s most powerful people and companies.

The Paradise Papers reveal offshore interests and activities of more than 120 politicians and world leaders, including US Commerce Secretary Wilbur Ross’s interests in a shipping company that makes millions from an energy firm whose owners include Russian President Vladimir Putin’s son-in-law and a sanctioned Russian tycoon, International Consortium of Investigative Journalists (ICIJ) said.

Following the findings, Ross decided to divest his shipping interest, according to media reports.