BELGIUM Law and Practice Contributed by: André Kegels, Kegels Advocaten
4.11 Insolvency Laws Applied by Maritime Courts
Alternatively, after an arrest, a public sale can be organised by an online sales process, with only one auction running over a predetermined period. In some circumstances, the court can allow a sale without this public process. The court which has ordered the public sale can be approached for the purpose of allowing a direct sale without going through the lengthy process of the pub - lic sale. If the rights of the totality of the known creditors, the debtor and the ship-owner are rea - sonably protected, the court may allow such a sale. The sales price must, at minimum, be equal to the market value of the vessel as established by an independent surveyor. The result is still a court-ordered forced sale of the vessel. Also, if the loan agreement entitles the lender to take possession of the ship, specific proceed - ings can result in the public sale being avoided. As regards maintenance and costs, as long as the vessel has not changed ownership the costs remain, in principle, for the account of the previ - ous owner. The arrestor or any other party who has an interest could ask the court (or the act - ing court bailiff) to make the costs of caretak - ing. Those costs would then be privileged on the price of adjudication. The rights in rem will be determined per the law of the flag. Foreign mortgages will be recog - nised if certain conditions in respect of publicity thereof are met. For Belgian-flagged vessels, the hypotheque (Belgium does not know the concept of mort - gages) comes after the ship’s privileges.
In respect of insolvency, Belgium must abide by the EU Insolvency Regulation, in common with the rest of the EU. As in many countries, the conflict between mari - time law and insolvency law is still ongoing. To date, courts have given priority to the obligations arising out of the 1952 Arrest Convention and, in doing so, have set the insolvency protection aside. This is still very much a debated issue. 4.12 Damages in the Event of Wrongful Arrest of a Vessel Courts are reluctant to condemn a party for wrongful arrest. A tort must have been commit - ted. Losing the case on the merits or the arrest being lifted does not, by itself, establish that a tort has been committed by the arrestor. 5. Passenger Claims 5.1 Laws and Conventions Applicable to the Resolution of Passenger Claims EU Regulations and the Athens Convention, as amended by the 2002 Protocol to protect pas - sengers, apply in Belgium. Some Belgian legis - lation incorporates those provisions. Conflicting contractual agreements will be set aside. The following apply: • the NBMC (Article 2.6.2.34 and following); • the Athens Convention relating to the Car - riage of Passengers and their Luggage by Sea, 1974 (the “Athens Convention”, or PAL 1974) and the 2002 Protocol to PAL 1974 (the “PAL Protocol 2002”); • Regulation (EU) No 392/2009, of 23 April 2009, on the liability of carriers of passengers
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