The European Commission has approved an update of German regulations to lower non-wage costs for seafarers.
Companies employing seafarers on eligible ships, registered in the European Union and European Economic Area (EEA), will be able to request a reduction in German social security contributions for their seafarers, matching the employer's contribution.
The changes to the Senkung der Lohnnebenkosten in der Seeschifffahrt will increase the number of shipping companies qualified to receive state aid.
Funding is now open for seafarers working on board merchant vessels registered in any EU country, said Euromar, the agency that assists ship managers with matters relating to Portugal's international ship registry in Madeira.
Financial aid was previously available only to vessels operating in German shipping registers.
The International Shipping Register of Madeira said the update covers seafarers working on Madeira-flag vessels.
The Madeira flag grew from less than 2m dwt to 20m dwt between 2013 and 2018 after setting up in Hamburg and luring a large part of that tonnage from German owners relocating to the EU from open registers.
Owners need to locate 60% of tonnage within the EU to be eligible for tonnage tax.
In May this year, the register expanded its footprint by moving into the world's biggest shipping market, Greece.
"The decision underscores the continuing EC action on state aid and confirms the consistent and favourable interpretation of European community guidelines on state aid to maritime transport," Euromar said.
The decision followed changes in May to the German wage tax deduction system.
That change allowed all EU/EEA-flag vessels with German underlying registry to claim a wage tax deduction for seafarers taxable in Germany. This law is in force until May 2027.
The extension to EU/EEA flags on wages meant it fully complied with European law, Euromar said then, "and is an important contribution to a more attractive maritime education and training environment in Europe".
