A leading UK lawyer believes the US could seek to take control of a VLCC detained in Gibraltar under suspicion of carrying Iranian oil to Syria.
The 301,000-dwt Grace 1 (built 1997), operated by Iships of Singapore, remains under investigation in the British territory. It could be in breach of both EU sanctions against Syria and US sanctions against Iran.
Stephen Askins, a partner at Tatham & Co, said the case has parallels with the US-backed detention of the 27,900-dwt North Korean vessel Wise Honest (built 1989) in May in Indonesia.
This was the first seizure of a vessel under the US civil asset forfeiture procedure more normally aimed at financial assets.
An argument was made under the US International Emergency Economic Powers Act that gives wide-ranging discretion to the US court to issue a warrant of forfeiture.
"Given the political leaning of so many judges appointed by President Trump it seems reasonable to assume that the US will be looking to do the same thing again," he added.
This will require an application before the same court in New York. If given, then the US will take control of the vessel. The crew would be repatriated.
"Both the UK and US seem to have been tracking the vessel for some time particularly as it was routed laboriously around South Africa rather than through Suez where often oil is discharged at one end and piped to the other and can be more closely monitored," Askins said.
Askins and Michelle Linderman, a partner at London law firm Crowell Moring, also pointed out that Gibraltar passed a similar law to the US seizure legislation on 3 July, the day before the vessel was held.
The Sanctions Regulations 2019 give the chief minister of Gibraltar powers to designate a vessel as a “specified ship” if he “has reasonable grounds to suspect that the ship … has been, or is likely to be, involved in a breach of the EU regulation”.
The Grace I was then immediately deemed a specified ship that “must be detained if it is in BGTW [ British Gibraltar Territorial Waters] ” and “may not leave BGTW unless permitted to do so by an order of the court or where the notice designating the ship as a specified ship has been revoked”.
As a specified ship, it can be detained for up to 90 days unless an application is made for its forfeiture or proceedings are instituted against any person for an offence. It can then only be released when the proceedings are closed.
The lawyers said: "The Supreme Court of Gibraltar has been given broad powers and may order the forfeiture of the specified ship; the cargo carried; or both the specified ship and the cargo."
Iranian threat a real one
Askins also said Iran's threat to detain a UK tanker in retaliation is a real one.
"A threat in the volatile Strait of Hormuz will be a viable one and will increase the risk to UK operated tankers," he added.
"In which case there will be some serious questions raised as to how to protect such tonnage from boarding either by sea or air. There is very little a crew can do to resist such a boarding."
Askins said private armed guards cannot be deployed on British shipping other than in the High Risk Area off Somalia.
This could be reviewed, but private personnel will be "very circumspect in opening fire on military forces determined to seize a vessel for political point-scoring," he added.
"UK military vessel protection detachments come with their own logistical problems but maybe something that UK shipping interests will insist on.
"They may prove a viable deterrent against action by Iran but they may well also serve as an additional trigger point in a very sensitive area."
As for the Grace 1 in Gibraltar, Askins said there will be a police-led inquiry to ascertain what was loaded and when.
Cargo documents and the ship’s computer will be scrutinised.
"The Indian and Pakistani crew will no doubt be cooperative," he added.
"It may be that the master will face some form of administrative offence under Gibraltar law depending on documentary discrepancies on board. The crew are unlikely to know anything of the financial payments in respect of the cargo."
Shipping databases list the owner as Russian Titan Shipping Lines of the Ukraine, with its registered address a PO Box in Dubai. The Grace 1 appears to be the only vessel in its fleet.
