UAE Law and Practice Contributed by: Abdelhak Attalah and Ghassan Hidar, Attalah Legal Consultancy
The documentary requirements for registering a mari - time mortgage are outlined in Articles 41 and 42 of the ML. Article 41 (3) specifies that a ship may be mort - gaged even while under construction, and the execu - tive regulations establish the procedures for register - ing such mortgages. Additionally, Article 42 stipulates that a ship mortgage must be accompanied by certi - fied signatures from the parties involved to be valid. The law also allows the use of modern technological means for carrying out mortgage transactions. The maritime mortgage register maintained by the Ministry is an official record, and access to it is restricted to owners unless authorised by official documentation. 1.7 Ship Ownership and Mortgages Registry The registers are official records maintained by the Ministry of Energy and Infrastructure. As outlined in Article 7 of the ML, the Ministry is responsible for cre - ating and managing the ship register, which includes detailed information about ships such as type, size, classification, navigation purposes and sailing areas. The Cabinet may delegate the responsibility for cre - ating and maintaining the register to a competent authority, and in such cases, that authority would assume the Ministry’s role. However, any changes or updates made to the register must be reported to the Ministry. Access to the ship’s records is generally restricted to the ship-owners unless permission is granted through official channels or documentation from an authorised entity.
es and corporate guarantees. The law expressly sub - ordinates itself to ratified international conventions (Article 2). 2.2 Ship Leasing Finance leases or other charters may not be record - ed over UAE-flagged vessels, and UAE courts may recharacterise certain finance leasing transactions as conventional loans. Article 137 (2) of the ML suggests time charters with purchase options may be catego - rised as bareboat charters. Sale and leaseback transactions are increasingly common. This structure allows the owner of the ship to sell and lease it back without incurring a huge debt on its financial statements, freeing up working capital while retaining operational control. The ML’s bareboat charter-in provisions (Article 18) facilitate such struc - tures where UAE operational presence is required. 3. Marine Casualties and Owners’ Liability 3.1 International Conventions: Pollution and Wreck Removal The liability of owners and interested parties in events of pollution and wreck removal in the UAE is influ - enced by both international conventions and domes - tic legislation. Internationally, two key conventions address pollution and wreck removal: • the International Convention on Civil Liability for Oil Pollution Damage (CLC) establishes the civil liabil - ity of ship-owners for damage caused by oil pollu - tion – this convention also includes related annexes and resolutions that set out the legal framework for liability and compensation; and • the International Convention Relating to Interven - tion on the High Seas in Cases of Oil Pollution Casualties (Intervention Convention) provides a legal basis for intervention in cases where oil pollu - tion from ships threatens the marine environment, outlining the powers and responsibilities of states to take action.
2. Ship Finance and Leasing 2.1 Ship Loan Finance
The ML modernises ship mortgage provisions (Arti - cles 41–52): mortgages apply regardless of tonnage; co-owned vessels require three-quarters majority approval; newbuildings may be mortgaged during construction; and mortgages rank after preferred debts (maritime liens) but enjoy priority determined by registration date. Typical security packages include assignment of earnings and insurances, share pledg -
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