Agent Untraceable, Owner Not Responding

Over​ a fifty-day period each spring, Khamsin winds from the Sahara blow transversely across the Suez Canal, making transit under sail almost impossible. Even motorised navigation is subject to the whims of the weather. That is why two experienced pilots from the Suez Canal Authority board every ship that enters the canal. Their knowledge of winds and currents reduces the chance of ships running aground. Most ships that are stranded are freed within hours. But not the MV (‘merchant vessel’) Ever Given.

On the morning of 23 March 2021, as freighters in the Gulf of Suez queued up to convoy northward, winds were gathering in the Eastern Desert. The Ever Given was the fifth ship in a line of twenty, and although it had pilots on board, it didn’t have tugboats accompanying it. Meteorological records show that at 7.40 a.m. gusts were near gale-force strength, and photographs taken from the Maersk ship behind show a sky tinted sand yellow. Despite the attempts of the Ever Given’s captain and the pilots to right its course, the ship was pushed sideways and its bow lodged in the riprap at the side of the canal. It had run aground, blocking a passage through which $10 billion worth of cargo travels every day. Some shipping companies immediately began to divert their vessels around the Cape of Good Hope. European car factories dependent on just-in-time parts from Asia – all coming through the canal – had to halt production. Six days later, with excavators digging around the bow and tugboats pushing and pulling the hull, the rising tide floated the ship just long enough for it to be freed. Canal journeys resumed, and the world’s attention shifted elsewhere.

But that wasn’t the end of the story for the seafarers on board. The Ever Given was escorted to an anchorage in the Great Bitter Lake, a third of the way up the canal, and detained there while the Egyptian government demanded $916 million in compensation from its owners and insurers. The Ever Given, one of the world’s largest container ships, was operated by the Taiwan-based shipping company Evergreen, which had chartered it from its Japanese owners, Shoei Kisen Kaisha. It flew the flag of Panama; its agent was a Dubai-based firm; and its Indian crew and officers worked for the German company Bernhard Schulte Shipmanagement. It also had multiple insurers. The Ever Given’s hull, machinery and cargo were insured in the Japanese market, while claims for injuries, accidents and pollution were covered by the UK Protection and Indemnity Club. The Suez Canal Authority, Shoei Kisen Kaisha, UK P&I and all of their lawyers negotiated in public and behind closed doors for the next three months, and finally took their case to Egyptian courts. After a settlement was forced on the parties, the ship was released on 7 July 2021.

In the fifteen weeks between the grounding and the ship being permitted to continue its journey to Rotterdam, the captain and crew remained on board, keeping the Ever Given clean and operational. They maintained the engine, updated the charts, cleaned the decks and made sure the refrigerated containers (which often carry chemicals) were functioning. Although the National Union of Seafarers of India, the International Transport Workers’ Federation (ITF) and the International Chamber of Shipping all tried to intervene on their behalf, the seafarers had no guarantee that they would be allowed to leave the Great Bitter Lake and were anxious that they might be held to ransom indefinitely by the Egyptian government.

They were right to worry. There was a precedent for seafarers being made legally responsible for their ships and detained. Just fifty miles away, Muhammad Aisha, a Syrian seafarer, was being forced to remain alone on board the Bahraini-flagged MV Aman, at anchor in the Gulf of Suez. Aisha had been hired in May 2017 as the Aman’s first mate. The ship was owned by a Bahraini company called Tylos Shipping and Marine Services, and operated by a crew of sixteen men from Egypt, India and Syria. According to an ITF report, the Aman was arrested in November 2017 (under maritime law a ship can be issued with an arrest warrant) by authorities in the Egyptian port of Al-Adabiya, on grounds of ‘unpaid wages, inadequate provisions, inhuman conditions, expired contracts. Owner told crew he has no money to pay them or pay for relievers. Indian crew paid service charges to be employed. Indian agent untraceable, owner not responding. Previous crew have also not been paid. Vessel arrested by three creditors.’

The families of the Egyptian and Indian crew members paid for them to be repatriated, but someone had to remain responsible for the vessel, and the Egyptian courts designated Aisha its legal guardian, required to live on a ship without fuel, electricity, food or water, swimming ashore every few days to secure basic supplies and charge his phone. By the time the Ever Given ran aground, he had been living on the Aman for nearly four years, and was suffering from malnutrition, anaemia and depression. Eventually, thanks to the media attention that turned to the Aman after the story of the Ever Given had run its course, the Egyptian government agreed to release him and he left the Aman in April 2021. The abandoned hulk still floats near where it was first detained in 2017.

One of the most brutally compelling accounts of modern seafaring is B. Traven’s novel The Death Ship, published in 1926. Traven – nobody knows for certain who he was, beyond the pseudonym, though he is thought to have been a German anarchist – chronicled the Mexican revolution in a series of novels celebrating ordinary people working in oil and cotton fields. The Death Ship is his love letter to seafarers, especially the forgotten fire gangs toiling away in the stokehold. The protagonist is Gerard Gales, a merchant seaman from New Orleans, who is arrested for not having his passport on him when he leaves his ship in Antwerp. He can’t secure new paperwork since he has no way of proving his identity to the US consul. Gales is deported from country to country until, paperless and penniless, he ends up in Cádiz and signs on to a dilapidated ship, the Yorikke. His fellow crew members are forced ‘to work so hard, they [are] chased about so mercilessly, that they forget everything that can be forgotten’. The ship, its tightly packed living quarters lit by kerosene lamps, is barely legal, and carries small cargoes and multiple sets of papers for whatever port it might end up at. It changes course from Greece to North and then West Africa, docking in Dakar. As Gales meanders from port to port, he meets sailors from many countries who are sleeping in doorways, flophouses and taverns. They burden him with their own stories of being left behind, of hunger and homesickness, tight-fisted ship owners and iron-fisted captains. The book brims over with accounts of freighters sunk for the insurance money, of awful living conditions, of loneliness and fear, of misery and depression. The accumulated tales of abandonment mirror the fate of Muhammad Aisha and the thousands of other abandoned seafarers a century later.

In 2022, a database maintained by the International Labour Organisation and the International Maritime Association listed 113 vessels and 1555 seafarers abandoned at sea, or within sight of shore: more than any other year on record. Ships are abandoned when their owners take on too much debt, or when they deliberately let the ship’s condition and licences slip, or when they fail to pay the crew’s wages. If they leave the ship, crew members lose the right to claim their wages, and in some jurisdictions they may be threatened with arrest for negligence, as Aisha was. Coastguards turn back stranded seafarers who try to come to shore. When the ship runs out of money, the crew are left at sea with no fuel, electricity or potable water.

The vast majority of abandoned vessels are flagged to open registries – countries, usually former colonial outposts, which have no nationality or residence requirements for ships operating under their jurisdiction. The convenience of flags of convenience is, predictably, reserved for owners and operators, who are subject to negligible oversight, inspection or accountability, and pay minimal tax and wages. More than 42 per cent of the world’s cargo tonnage is flagged to Panama, Liberia or the Marshall Islands, and a disproportionate number of abandoned ships are flagged to Panama. The ITF lists 42 flag of convenience countries, non-signatories to the international conventions that protect the rights of seafarers. Bahrain, to which the Aman was flagged, is not on this list, but – along with other Gulf countries where trade union activity is circumscribed, such as Saudi Arabia and the UAE – it functions as a flag of convenience country in all but name. I found a 1981 letter in the ITF archives at Warwick University from a Sri Lankan seafarer in which he complained about the working conditions on ships flagged to Gulf countries and added: ‘I wish to state without hesitation … my experience is that ships of these flags are the biggest violators of all international regulations.’

After the Covid pandemic hit, the number of abandoned vessels rose sharply. In their 2020 filing to Companies House, the Mission to Seafarers, an Anglican charity, reported:

One of our chaplains observed early in the crisis that among seafarers ‘there was a mental health epidemic paralleling the pandemic.’ Shore leave when in port also became very difficult, if not impossible, preventing the opportunity for a break from the ship or to access local facilities. Crews without wifi access on board could not even maintain basic contact with family. For all those unable to end contracts, similar numbers were unable to join ships, often leading to financial hardship.

In the early stages of Covid, it quickly became clear that the mobility that defined the frantic pace of global capitalism had increased virus transmission. Over the past decades, ever bigger cargo and cruise ships have moved from port to port; ever more frequent passenger and freight planes have taken off and landed. When governments began closing borders and imposing quarantine measures, seafarers were often suddenly unable to disembark or fly home. The International Maritime Organisation estimated that at one point in 2020, some 400,000 seafarers were stranded on their ships. There were reports of people jumping overboard and suicides by overdose. The working conditions of those on cruise ships were particularly dire. Even the most gargantuan freighters operate with no more than thirty or so seafarers, but cruise ships employ hundreds, living in close quarters, two to four in cabins below the waterline with no portholes. Aside from operating the ship, they wash mountains of laundry, cook and serve vast numbers of meals three times a day, constantly clean hundreds of cabins and a dozen decks, and entertain and attend to hundreds, sometimes thousands, of passengers.

The first cruise ship to be stranded by the pandemic, the Diamond Princess, anchored at Yokohama in early February 2020. Two weeks later it was thought to be carrying half of the world’s Covid cases outside China. In mid-March, the three thousand passengers on board another liner, the Ruby Princess, disembarked in Sydney and spread out across Australia before it was discovered that more than a quarter of them were infected with the virus. The ship’s 1100 crew members remained quarantined on board for several weeks. Many of them exhibited flu-like symptoms but had no access to tests or to healthcare on shore. This seems to have been the fate of almost all the cruise ships stranded by Covid border closures.

Michael Smith and Jonathan Franklin tell the horror story of another plague ship, the Zaandam, owned and operated by Holland America, which left Buenos Aires on 6 March 2020. The cruise ship companies already knew that their vessels were hothouses for the mysterious pathogen, and yet they still allowed their ships to set sail. Cabin Fever traces the spread of the virus aboard the Zaandam as port after port along South America’s Pacific coast refused it harbour. There were reports at the time of the horror felt by its elderly passengers as more and more of them fell ill, but Smith and Franklin also tell us about the crew members – still working their shifts however ill they were, while being denied the scarce medication, which was reserved for passengers. The Zaandam was finally allowed to transit the Panama Canal on 29 March, but then had to wait a few days before the White House and the Florida administration granted permission for those on board to go ashore. The passengers disembarked at Port Everglades in Florida, were taken to Atlanta and then flew on to their final destinations, all without a single public health precaution being put in place. The crew members, meanwhile, remained on board for weeks as the Zaandam circled the Caribbean. None of them had any idea when they would be allowed to go home.

Holland​ America, like Princess Cruises, is owned by the Carnival Corporation, which also owns Carnival Cruise Line, Costa Cruises and Cunard. Carnival has its headquarters in Miami but is registered in Panama, where in 2019 it paid just $71 million in taxes on $20.8 billion in revenue, 0.3 per cent. The other two major cruise lines, Royal Caribbean and Norwegian, also have their head offices in Miami and are registered in Liberia and Bermuda respectively. In 2019, the former paid $36.2 million in taxes on $10.95 billion in revenue, the latter $18.9 million on $6.46 billion in revenue. Corporations of all sorts benefit from offshoring their production and services functions, or their finances and banking, but the practice has been particularly rewarding – and easy – for shipping companies. Open registries have proliferated since the 1930s, but offshore registration of the actual companies or subsidiaries that own the flagged-out ships adds another layer of secrecy to an already secretive business. Many of the world’s largest shipping firms are owned by families or family trusts, and their finances and operations are opaque, thanks to shell companies registered in tax havens and minimal requirements for oversight.

But however impenetrable their ownership structures, and wherever in the world they claim to be based, there is one point of contact that shipping companies can’t avoid: the insurers, most of which trade from a single building, Lloyd’s, at One Lime Street in London. Edward Lloyd set up his coffeehouse on the bank of the Thames in 1686 as somewhere for sailors and merchants to exchange maritime news and rumour. It eventually became a hub for insurers. Lloyd’s has never been an insurance company itself: it’s more like a marketplace, in which a broker connects a client with something to be insured with insurance companies operating from Lime Street. A single cargo ship will have multiple insurers underwriting its hull, its cargo, the carrier’s liability, the crew’s accident insurance, and the risks to its journey, including war, sabotage and vandalism, kidnap and ransom, and shipboard or landside strikes.

Until 1807, Lloyd’s had a monopoly on the maritime insurance of human cargoes of enslaved Africans. In 1944, Eric Williams pointed out in Capitalism and Slavery that ‘many advertisements in the London Gazette about runaway slaves listed Lloyd’s as the place where they should be returned.’ After the abolition of the slave trade, Lloyd’s continued to focus on the colonies, where the returns on investment were higher than in the metropolitan countries. In Dead in the Water Matthew Campbell and Kit Chellel describe Lloyd’s first 270 years as ‘an invitation-only investment club for preserving wealth and privilege’. In the 1960s, however, liquidity crises brought on by the end of colonialism opened the door to nouveau riche individual investors, and three decades later to major international conglomerates with deep pockets. Given the ignominious history of Lloyd’s, the vast sums of money tied up in insurance policies, and the shenanigans that both the insured and insurers get up to, it’s a wonder that the sector is often represented as staid and stable.

This is the context for Campbell and Chellel’s thriller-like story of the MT Brilliante Virtuoso, a Very Large Crude Carrier hired in 2011 by a Cypriot logistics firm to lift a cargo of oil from Kerch in Ukraine for a destination in China. The ship was owned by Suez Fortune Investment, a shell company domiciled in the Marshall Islands, and was flagged to Liberia. Its cargo and hull were insured at Lloyd’s, mainly by Zurich Insurance Group and Talbot Underwriting respectively. At midnight on 6 July, the ship was boarded by masked gunmen in the Gulf of Aden. At around 2.30 a.m., the gunmen set off an explosion in the ship’s accommodation block and fled in their skiff. The Brilliante Virtuoso’s 26 seafarers, all Filipinos, activated a distress signal and took to the lifeboats. The signal alerted the United Kingdom Maritime Trade Operations centre in Dubai. The UKMTO, which describes itself as ‘the primary point of contact for merchant vessels and liaison with military forces’ in the Indian Ocean, directed the USS Philippine Sea, a US navy guided missile cruiser patrolling the Gulf of Aden, to pick up the tanker’s crew. Over the next few weeks, salvage companies attempted to save the ship’s cargo. The British insurers sent David Mockett, a British marine surveyor resident in Aden, to scrutinise the timeline and causes of the explosion. Shortly after Mockett conveyed his suspicion that the ship was the target of insurance fraud, he was killed in Aden by a car bomb.

Campbell and Chellel’s story of pirates and perfidy veers all over the world and includes a cast of characters of salty seafarers, hard-driving maritime salvors, commercial adjudicators and barristers, insurance men, detectives and hired thugs. Cantankerous investigations in the City of London are followed by high-speed chases in the Greek mountains and hush-hush whistleblower meetings in the Philippines. When you really understand its inner workings, the insurance industry is enthralling. The book’s most surprising revelation is the reluctance of the insurance firms to acknowledge the possible fraud: entanglements like this get in the way of the simple business of making money. The companies ultimately pursue the unscrupulous owner of the Brilliante Virtuoso because they are pushed into it by investigators concerned about their recovery fees. Traven’s novel is largely about insurance fraud. He points out that, unlike the sailors in their sinking rust buckets, the insurers never really lose: ‘A good capitalist system does not know waste … Why are insurance premiums paid? For pleasure? Everything must produce its profit. Why not make premiums produce profit?’ Insurance providers operate in the shadows, following arcane norms and codes that ultimately underwrite the unfettered pursuit of profit for all, at the expense of wasted lives.

In his recent book, Captured at Sea: Piracy and Protection in the Indian Ocean, the anthropologist Jatin Dua, who spent months on patrol ships, freight vessels and dhows to research piracy in the Red Sea, also makes connections ‘from northern Somalia to the offices of Lloyd’s of London’. For Dua, the pirates, insurance providers, naval officers, the seafarers themselves and the shipboard security firms all produce an ‘alternative system of connectivity, forged through protection’. Protection involves grey anti-piracy warships, grey-suited insurance men and grey shades of morality. At sea, the boundary between licit and illicit is porous, and what is construed as legal shifts according to the tenacity of your lawyer.