Sunken property: new chapter of Merchant Shipping Code of the Russian Federation

The Federation Council of the Federal Assembly of the Russian Federation approved changes to individual legislative acts on the removal of sunken property in December 2021.
These changes are related to the accession of Russia to the Nairobi International Convention on the Removal of Sunken Ships.

Thus, the amendments were made to The Merchant Shipping Code of the Russian Federation, the Code of Inland Water Transport of the Russian Federation, the Law of the Russian Federation «On International Commercial Arbitration» and the following federal laws «On internal sea waters, territorial sea and adjacent zone of the Russian Federation», «On jurisdictional immunities of a foreign state and property of a foreign state in the Russian Federation».

The conditions and procedure for the removal of sunken vessels in internal sea waters, territorial sea of the Russian Federation and exclusive economic zone of Russia are regulated.

The concepts of «sunken property» and «disposal of sunken property» are disclosed. Sunken property means a ship or part of a ship that has been sunk or run aground, including property that is or was on board such a ship or property that has been lost from the ship and is flat, sunk or adrift at sea, a vessel which has almost sunk or run aground, or may sink or run aground, unless measures are taken to assist the ship in distress or its property. The disposal of sunken property shall be understood to mean its lifting from water, transport and destruction by any safe means, as well as the removal of the vessel from dry land.
The disposal of sunken equipment will be carried out on the basis of documentation for the removal of sunken equipment (hereinafter Documentation), which should contain a description of the method and means of disposal, the sequence of actions and the requirements for their safety.
It is envisaged that the disposal of sunken property will be carried out within a set period and in accordance with established procedure, by the owner of such property or, in certain cases, by the administration of seaports or the executive authority of the subject of the Russian Federation, the nearest beach is the property that was sunk.

The seaport authority shall be entitled to reimburse the cost of removing a sunken vessel by selling the sunken property in respect of costs not covered by the organization, having insured or otherwise provided financial security for the disposal of a sunken ship, or by the owner of the sunken ship.
The subject of the Russian Federation, whose coast is closest to the sunken property, will be provided with a subsidy from the federal budget to co-finance expenses for the removal of the sunk property.
The analysis of innovations brings some confusion and misunderstanding...
For example, what is meant in article 107 of the Merchant Shipping Code under the concept of "sunken property" - a permanently sunk or grounded vessel or part of such vessel, or also a vessel that has almost sunk or sank or may sink or sink to the bottom, If measures are not taken to assist a ship in distress?
This question is reasonable, because it is not clear to shipowners if the vessel has almost run aground or is aground, it is specially approached or passes by another vessel with which the latter is «Disposal of sunken property» by virtue of the requirements of art. 107 Merchant Shipping Code of the Russian Federation and whether in this situation it is necessary to develop and submit for agreement to the authorities of the Federal Marine Agency and the captain of the seaport documentation on the removal of sunken property, including a description of the method and means of removal, Sequence of actions and safety requirements? I.e. while the shipowner will develop and agree on the documentation, the vessel will actually sink or run aground, or it will fall over rocks if it has already touched the ground.

Marked dual understanding of the provisions of art. 107 In our opinion, the Merchant Shipping Code of the Russian Federation represents a corrupting factor when the port captain can «stand up» and require documentation on the removal of sunken property, and in individual cases (depending on who will ask him about the removal of sunken property) Consider the vessel as almost sunk or nearly grounded, that is, not to apply to it the status of sunk, and «give permission», turning a blind eye to its removal without providing the agreed documentation provided for in Art. 112 Merchant Shipping Code of the Russian Federation, which is actually not contrary to common sense, since prompt actions to save the ship will prevent a more serious accident and possible damage to the environment. However, the adoption of such a decision puts the ILC itself at risk vis-à-vis supervisory and/or supervisory bodies.
According to the requirement of part 1. 108 Merchant Shipping Code «The master of a ship and the owner of the ship are obliged to send a message about sunken property to the captain of the nearest seaport». There is a reasonable question: when does the property (ship, cargo remnants etc.) acquire the status of the shipwrecked? From the moment of notification?

And if the notification is not filed or the owner of the property is not known? Then by virtue of the requirements of art.1. Part 7 Article.108 Merchant Shipping Code of the Russian Federation: «The captain of a seaport publishes information on the deadlines set for submitting a notice of intention to proceed with the removal of sunken property, in «Notices to mariners» State authorities referred to in subparagraphs 1 and 3 of paragraph 5 of this article (the executive authority of the subject of the Russian Federation, whose coast is closest to sunken property and the federal executive authority, performing functions of public services and management of state property in the field of maritime transport, if the owner of the sunken property is not known), placed on their official sites in the information and telecommunication network «Internet» Information on the time limits set for notification of intention to proceed with the disposal of the sunken property. This procedure is made by the order of the Ministry of Transport. But the order is a regulatory act that must go through an approval (recognition) procedure by the Ministry of Justice, including a procedure for public discussions and assessment of regulatory impact. The total duration of these procedures may be 3 months. An example of this can be the Order of the Ministry of Transport of Russia from 12.05.2022 176 «On the establishment of requirements for the composition and content of documentation for the removal of flooded equipment, as well as criteria for evaluating such documentation» (registered in the Ministry of Justice of Russia 01.06.2022 68674), which was posted on the Federal portal of legal acts 11.06.2022. In response to the above question, it is reasonable to assume that the status of «sunken» property acquires only after the formation of a list of sunken property approved by the Ministry of Transport. Before this time, the owner of a grounded vessel or a vessel that has broken anchor or even a ship that has sunk (lowered) directly at the berth, must be able to raise it without documentation, for which the Merchant Shipping Code is delayed from 2 to 6 months (pp.3 ч.4 art. 110 the Merchant Shipping Code of the Russian Federation) and any coordination. That is, based on the above, it is necessary to make revisions in Merchant Shipping Code of the Russian Federation and specify the moment of acquisition of property status «sunk», otherwise you will have to work out judicial practice, i.e. bring possible court cases to the Supreme Court of Russia, Whose decision, in time, and will give the answer to the above question. At the moment there is no clear answer.

According to part 6 art.109 the Merchant Shipping Code of the Russian Federation: «Disposal of sunken property is carried out on the basis of documentation on the removal of sunken property, agreed by the captain of the seaport». What is this document, where to get it, and the most important thing is that it should be written? This question is answered by the Order of the Ministry of Transport of Russia from 12.05.2022 176 «On the establishment of requirements for the composition and content of documentation for the removal of sunken equipment, as well as criteria for evaluating such documentation» (hereinafter - Order), to which there are also questions.
Sections 1-4 of the Order specify what is included in this documentation, but implementing it in practice may entail the following difficulties.
Section 3 of the Order prescribes that the Documentation shall have in its composition «Project for Disposal of Sunken Property», consisting of 13 subsections as follows:
1. Description of how to remove the sunken property;
2. a description of the assets involved in the removal of the sunken property, indicating the names of the vessels, their types and their main dimensions (if the vessels are involved);
3. A description of the identified risks to the marine environment during work related to the removal of sunken property;
4. Description of measures to prevent harm to the marine environment during work related to the removal of sunken property;
5. a description of the resources employed to prevent harm to the marine environment during work related to the removal of sunken property;
6. Information on the predicted environmental condition during the disposal of the sunken property;
7. Description of methods (ways) to control the contamination of components of the natural environment, their volume and periodicity during work related to the removal of sunken property;
8. information on the existence of a contract (date of conclusion of the contract and its duration) with an organization that provides emergency services and rescue forces with constant readiness for the elimination of oil spills during the execution of the work, related to the disposal of sunken property (in case on board the sunken ship are petroleum products, bunker fuel and oil);
9. Description of the method(s) of delivery of recovered sunken property to its repair, storage or disposal;
10. Details of the location of repair and (or) storage of the sunken property;
11. Description of how and where to dispose of the sunken property (if so);
12. Information on the estimated date of commencement of removal of the sunken property and the estimated duration of said work;
13. Hydrographic, hydrophysical and diving surveys of sunken property (if available).

Owners' attention
From 01.03.2023, the amendments to the Merchant Shipping Code of the Russian Federation shall enter into force, according to which the latter is supplemented by Chapter XIX.2. Agree that "The owner of a vessel with a capacity of 300 or more to cover his liability for the disposal of a sunken vessel must insure or otherwise provide financial security
Responsibility under the requirements of the Nairobi
Convention on the Removal of Sunken Ships, 2007". (art.336.11). This article applies to all vessels regardless of whether they are self-propelled or not. The existence of insurance coverage will have to be confirmed by an Insurance Certificate or other financial guarantee for the responsibility for the disposal of sunken ships issued by the captain of the port of registry (registration). " The organization and implementation of verification of the certificate specified in this article shall be carried out within the framework of State port control" (ch.3 art.336.12 Merchant Shipping Code of the Russian Federation). If the vessel does not have the above-mentioned certificate, it may be detained in the port of arrival until the remark is removed, i.e. it will simply not be allowed to leave. The consequences and economic losses must be understood by shipowners.
One question remains: "What is the capacity? Gross or net?" For the Merchant Shipping Code of the Russian Federation the gross is used." For the purposes of articles 320, 326, 331, 336.6 - 336.8 and 359 of this Code, vessel capacity means its gross capacity as defined in accordance with the rules on the measurement of vessels contained in Annex 1 to the International Convention on Measurement of Ships of 1969". (art. 10 Merchant Shipping Code of RF).
The new article 336.11 was adopted, and the amendment to the article 10 was forgotten. But since this certificate will be issued in compliance with the requirements of the Nairobi Convention, it will definitely be gross, as according to the latter: "A registered owner of a vessel with a gross capacity of 300 or more flying the flag of a State Party shall, in order to cover his liability under this Convention, insure or otherwise provide financial security, for example a guarantee by a bank or similar institution, in an amount equal to the limit of its liability under the applicable national or international limitation regime, but in no case exceeding the sum, calculated in accordance with article 6, paragraph 1 b), of the 1976 Convention on Limitation of Liability for Maritime Claims, as amended" (art. 12 Nairobi Convention).