Lieberman and Collins: Shipping industry must choose between Iran and the US

For years, the United States and Europe have aggressively pursued tough multilateral sanctions to deter conduct by countries that runs contrary to international peace and security. Among the sharpest arrows in our diplomatic quiver, sanctions seek to isolate “rogue” states by denying them access to the benefits of the global economy.

Sanctions are particularly useful when aimed at countries like Iran, which has a history of conduct that directly threatens global security – including its latest egregious act, an alleged plot to assassinate the Saudi Arabian ambassador to the US.

Yet despite sanctions aimed at a broad range of economic activities, Iran and other rogue regimes continue to find ways to thwart these restrictions and engage in activities that fund dangerous pursuits. One such tactic involves the complex labyrinth of international shipping.

Iranian vessels are involved in importing nuclear material and exporting resources that provide the regime much needed currency, helping the country evade sanctions and further its development of a nuclear weapon. Multiple Iranian vessels have also been caught shipping weapons to terrorist groups, including Hamas and Hezbollah.

The nature of the international shipping industry – with numerous and frequently changing vessel owners, lessees, charterers, and sub-charterers (often shell companies), coupled with the inherent mobility of vessels – can make effectively applying sanctions extremely challenging.

One key aspect of the international shipping industry, however, is both controllable and vital to Iran’s shipping activities: the certification of vessels by organizations known as classification societies.

Without certification by a respected classification society, it is difficult – if not impossible – for a vessel to secure insurance or gain entry to a major international port. Certifications are also essential for conducting international trade. In short, without the endorsement of a classification society, a vessel does not have a “license to trade” in the world market.

Classification societies develop technical standards for the design and construction of vessels and other marine structures. Through design reviews and on-site surveys, they certify that vessels meet their standards. They also act as “recognized organizations” of national governments to certify that a vessel complies with the regulations of the country whose flag it is flying.

1 | 2

Next