Faroe Business Report — The International Review of Faroe Islands Industry and Trade - Faroe Business Report — The International Review of Faroe Islands Industry and Trade

A couple of years ago the FAS was given its own office facilities and dedicated staff, a move that gave it a more prominent status after long years of low-key existence.

Recently rejoined with the Faroese Maritime Authority (FMA), the registry has been equipped with more resources as a basis for development and growth. Meanwhile legislative changes introduced a few years back could make the FAS more competitive in the marketplace, with established international standards replacing special national regulation and an attractive fiscal regime in place.

“The important thing now for the registry is to stick with its core strategy,” said Óli Hans Hammer Olsen, former FMA managing director and now managing owner of TSM, a maritime consultancy and member of the Shipping.fo consortium.

“The FAS must be given the chance to be introduced properly, and the time to demonstrate longterm commitment and political stability.”


Standards, not age: What sets the FAS apart from e.g. Norway’s NIS and Denmark’s DIS, is its emphasis on international standards and its objective of attracting a sufficient number of vessels to generally make a difference to the Faroese economy, Mr. Hammer Olsen said.

“The Danes and the Norwegians already had their merchant fleets when they created their open registries to prevent ships from flagging out. Our order of priorities is different as we have set out to attract international fleets to the Faroese flag with the idea that this will ultimately hava a positive impact on our community in a socio-economic sense.

“We’ve been able to tailor the FAS in accordance with international standards and to make it interesting from a fiscal point of view, while at the same time retaining our credibility and status as a Nordic seafaring nation.”

The idea of introducing a certain age limit to vessels registered under the FAS has been strongly rejected by most members of the Faroese maritime cluster.

Said Jónas Sigmarsson, a human resource consultant for the maritime industry: “Port State Control authorities everywhere assume by default that any ship having reached the age of twelve poses an increased level of risks compared to a new ship. But that does in no way translate into discouraging shipowners to keep vessels that are older than that. It would have been absurd economically to try and force everyone to only have new vessels and it would leave our registry with a very small market.”


Norwegian issue: Well-defined standards such as the International Convention for the Safety of Life at Sea (SOLAS) are extremely important for effective maritime regulation, Mr. Sigmarsson pointed out.

To establish and maintain technical standards for the construction and operation of ships and offshore structures, classification societies play a major part as expert inspectors and surveyors. In addition, consultants with specialist knowledge often help shipowners and vessel operators comply with the totality of regulations, which includes keeping certificates up to date and making sure all equipment meets minimum requirements.

Mr. Hammer Olsen added: “I’ve seen a brand new ship that was only seven months old being detained by Port State Control because of compliance issues; but I’ve also experienced a thirty-year old vessel going through inspections without a single remark. So in addition to the shipping cycles recognized by the industry, the obvious criteria to work from are the international maritime standards, conventions, and protocols adopted by the IMO [International Maritime Organization] and the ILO [International Labour Organization], including for example the technical standard on safety known as the SOLAS treaty. All of this serves to weed out substandard ships regardless of age so that vessels that are too old are automatically and consistently kept out of our registry.”

The fact that a number of Norwegian shipowners have placed their merchant vessels under the Faroese flag has apparently led to frustration in their former home ports. So much so that FAS vessels have reportedly been targeted for inspection without good reason.

“We’ve seen examples of harrassment and these incidents will have to cease immediately,” Mr. Ingmarsson said.