Delegates of the annual meeting of the International Labour Organization (ILO) have voted in favour of approving amendments to the Maritime Labour Convention, 2006 (MLC) provision of financial security for crew. The MLC already states that ships must provide financial security to cover the costs of repatriation and to assure compensation in the event of death or long-term disability due to an occupational injury, illness or hazard. These amendments mean flag states will have to specify just how this will be achieved and outline exactly what liabilities will be covered.



‘Abandonment’ has been defined as where: the owner fails to cover the cost of repatriation; has left the crewmember without the necessary support for survival on board (such as food, accommodation, water supplies and essential fuel); or has severed their ties with the crewmember including the failure to pay contractual wages for at least two months.

“The financial security system [for abandonment] must be sufficient to cover outstanding wages and other entitlements under the Seafarers’ Employment Agreement [SEA], the relevant collective bargaining agreement or the national law of the flag state, limited to four months,” explains Charles Boyle, director of legal services at Nautilus International. The system must also cover, adds, Boyle, “all expenses reasonably incurred, including the cost of repatriation, [such as] food and accommodation from the time of leaving the ship until arrival at home, necessary medical care, passage and transport of personal effects and any other reasonable costs or charges arising from the abandonment.” And, finally, “the essential needs of the seafarer including such items as adequate food, clothing where necessary, accommodation, drinking water supplies, essential fuel for survival on board the yacht, necessary medical care and any other reasonable costs or charges from the act or omission constituting the abandonment until the crewmember’s arrival home.”

With regards to a social security system for death or long-term disability due to an occupational injury, illness or hazard, the flag will determine the exact form the system of protection will take, but it could take the form of a social security scheme, insurance or a national fund.


"The certificate or document must be posted in a conspicuous place on board and be available to all crewmembers. [It] must contain the name and address of the provider, as well as the contact details of the persons or entity responsible for handling claims."



“Owners must possess ‘a certificate or other documentary evidence of financial security issued by the financial security provider’,” explains Boyle. “The certificate or document must be posted in a conspicuous place on board and be available to all crewmembers. [It] must contain the name and address of the provider, as well as the contact details of the persons or entity responsible for handling claims.”

These new requirements for financial security will become part of the Port State Control (PSC) inspection process and must be entered on the yacht’s Declaration of Maritime Labour Compliance (DMLC) Part II. “If a yacht is not compliant it is liable to be detained,” says Boyle. “Therefore, yacht masters need to keep abreast of the requirements of the flag state on these issues.”

These amendments are expected to come into force in early 2017, however flag states do have the option of imposing earlier enforcement. Existing MLC certificates and DMLCs that have been issued prior to the approval of the amendments will remain valid but will need ot be issued or renewed in the new and updated format no later than the date of the yacht’s first renewal inspection following the amendments’ entry into force.