Comparison of the maritime mortgages of Greek maritime law with relevant institutions of English maritime law
Master Thesis
Author
Χαραλαμπέα, Ευγενία
Charalampea, Evgenia
Date
2023-10-31Advisor
Δανιήλ, ΓεώργιοςDaniil, Georgios
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Keywords
Shipping industry ; Shipping cycles ; Capital ; Debtor ; Lender ; Collateral ; Simple mortgage ; Preferred mortgage ; Maritime liens ; Bank ; Credit ; FundingAbstract
It is well known that most of the global trade’s volume today is transported by the sea, so it is
obvious that there is a close relationship between global trade and the shipping industry. But
shipping industry is also a significantly volatile industry, which depends on various extra
external factors such as geopolitical situation, environmental conditions, inflation, national
policies regarding the shipbuilding industry, the increased demand for certain goods, the sharp
change in the price of the basic raw materials etc. It is also an industry which appears to be
cyclical, which means that there are relevant situations which seem to be repeated in regular
intervals and are therefore called shipping cycles and consist of 4 phases (recession, recovery,
peak and collapse). So due to shipping industry’s affection by so many external and sometimes
unpredictable factors, the need to fund the ship owner for a new vessel’s acquisition, vessel΄s
maintenance or operation, which are capital intensive tasks, is required, therefore the ship owners
take loans from financial institutions. But on the other hand, the financial institutions which
granted the loan need to assure that their money are safe, so the vessel itself becomes the
collateral for the ship-owner’s lenders, by registering encumbrances on it, the so-called maritime
mortgages, simple or preferred. Another institution strongly connected with the shipping
transactions is maritime liens, which is collateral security on the vessel arising simultaneously
with the services or events that trigger the maritime lien. Ship owners promise to insure creditors'
debt through the ship itself. As an interest in property, a maritime lien extends only to the value
of the asset, which is ship’s value. Both above institutions, i.e. maritime mortgages and liens are
regulated differently in Greek and English jurisdiction, but the aim of both jurisdictions remains
to provide security to the shipping industry, by providing the vessel itself as collateral: