US official praises Panama move to remove registration from sanctioned ships

Stricter registration policies from Panama, the world’s largest ship registry, come amid a push to crack down on oil smuggling.

A new executive decree from Panama will strip maritime vessels of their licences if they face global sanctions, a move praised by former US ambassador John Feeley as a step towards improving the business climate.

Panama, home to the largest ship registry since 1993 and the Panama Canal, is under scrutiny for oil smuggling from Iran and Russia.

Protecting ‘prestige’ of Panama

President Jose Raul Mulino issued a decree on October 18 to revoke vessel registrations facing sanctions by the US, UK, UN, or EU to maintain Panama’s reputation.

With over 8,000 ships registered, Panama aims to prevent misconduct through tighter regulations and immediate registry cancellations.

Response to international sanctions

The decree, a response to pressure from the US and allies, aims to combat illicit activities and ensure Panama’s removal from the EU tax haven list.

Experts anticipate a significant impact on vessel owners and operators engaged in risky or illicit activities, prompting other flag states to review their regulatory frameworks.