Panama revokes 107 ship registrations as sanctions tighten

Panama has officially deregistered 107 Panamanian-flagged vessels listed under international sanctions, with an additional 18 currently undergoing the deregistration process.

The deregistered vessels had been identified for compliance concerns or were listed on sanctions list issued by OFAC, the European Union, and the United Kingdom, according to the Panama Maritime Authority (PMA).

Tightening curbs on Russia’s and Iran’s oil and energy industries have increased scrutiny on the operations of the so-called “dark fleet” – poorly insured vessels which significantly increase the risk of a major oil spill in European waters.

As it is reported, this action is in accordance with the executive decree no. 512 of October 18, 2024, which grants the PMA the authority to unilaterally cancel the registration of vessels, as well as registered individuals and shipowners, that appear on international sanctions lists.

Historically, the deregistration of vessels involved in illicit activities was carried out under the general merchant marine law (law no. 57), specifically article 49, which outlined the criteria for such procedures.

However, the lengthy processing times -approximately three months- impacted the international perception of the Panamanian flag.

To expedite this process and prevent sanctioned vessels from continuing operations, the Panamanian government enacted executive decree no. 512, enabling the immediate deregistration of ships whose owners or vessels appear on the international sanction’s lists specified in the decree.

As the PMA explains, this measure ensures that no vessel or shipowner linked to illicit activities operates under the Panamanian flag, while still respecting the registration of maritime mortgages and the legal rights of the parties involved.

“To prevent high-risk vessels from entering the Panamanian Registry, the pre-registration analysis process has been strengthened. This enhanced process now considers not only the vessel’s technical criteria but also the background and operational history of its owner and operator,” the PMA said.

Additionally, risk matrices have been implemented, along with upgrades to technological platforms, to identify vessels potentially connected to illicit activities.