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Maritime Law

What is Maritime Law?

In most developed countries, the law of the sea follows a separate code and is a separate jurisdiction from domestic law.

The Law of the Sea governs many insurance claims relating to ships and cargo. Civil matters between shipowners, crew and passengers. and piracy. In addition, the Law of the Sea regulates procedures for the registration, licensing and inspection of vessels and shipping contracts. marine insurance; and transportation of goods and persons.

IMO established in 1948 and enacted in 1958 as an intergovernmental maritime advisory body is responsible for keeping existing international maritime conventions up to date and developing new conventions when necessary.

Today, there are dozens of conventions regulating all aspects of maritime commerce and transport. The IMO names three conventions as its core:

  • The International Convention for the Safety of Life at Sea

  • The International Convention for the Prevention of Pollution from Ships

  • The International Convention on Standards of Training, Certification, and Watchkeeping for Seafarers

History of Maritime Law

The origins of the laws of the sea can be traced back to ancient Egypt. At that time, ships were used to transport goods and required a well-defined set of rules to ensure safety, fair trade, and resolution of disputes between different parties.

However, the first documented lore of formal rules was discovered much later. From 900 BC the Rodina Law of the Sea enacted between 300 years. BC establishes the official rule of the Mediterranean.

These laws regulated maritime trade in the region, influenced the Romans, and were in effect for a very long time. European maritime law developed gradually over the following centuries.

Important developments that helped shape the current law include the Naval Consulate, Oleron's Roll, and the early British Admiralty Act, which later helped shape the Admiralty Act in his 1600s. However, it was not until 1789 that a unified legal system was established, with federal district courts taking charge of maritime litigation.

Merchants and Mercantilism

In the early 16th century, European financial theorists recognized the importance of the merchant class in wealth creation. Cities and countries selling goods flourished in the late Middle Ages.

As a result, many believed that the state should allow major merchants to create exclusive state-controlled monopolies and cartels used military force to protect these monopolies from domestic and foreign competition.

Citizens were allowed to invest money in mercantilist enterprises in exchange for chartered property and limited liability. These citizens received a share of the company's profits. Basically, these were the first company shares to be traded. The most famous and powerful Mercantilist corporations were the British East India Company and the Dutch East India Company. For more than 250 years, the British East India Company held exclusive recognized trading rights between Britain, India and China. The trade route was protected by the British Navy.

What's the Difference Between Capitalism and Mercantilism?

One difference is the role that the state plays. Capitalism calls for a minimum of government intervention and ownership of capital, trade, and industry by private entities and individuals. Mercantilism involves state control and regulation. Capitalism is said to promote individual freedom. Mercantilism is said to suppress it.

Mercantilism v. Imperialism

Mercantilist governments manipulate a nation's economy to create favourable trade balances. Imperialism uses a combination of military force and mass immigration to foist mercantilism on less-developed regions. Military campaigns forced inhabitants to follow the dominant countries' laws. One of the most powerful examples of the relationship between mercantilism and imperialism is Britain's establishment of the American colonies.

Mercantilism vs. Capitalism

Capitalism provides several advantages over mercantilism for individuals, businesses, and nations. With capitalism's free-trade system, individuals benefit from a greater choice of affordable goods. On the other hand, mercantilism restricts imports and reduces the choices available to consumers. Fewer imports mean less competition and higher prices.

Mercantilist countries engaged in warfare frequently to control resources. Nations operating under a free-trade system prospered by engaging in mutually beneficial trade relations.

Ship Registration Under Maritime Law

The country of registration determines the nationality of the ship. For most ships, the national registry is the country where the owner resides and does business. Shipowners often register their vessels in countries that allow foreign registration. A foreign registration, known as a “flag of convenience,” helps you take advantage of tax planning and generous local laws. His two examples of "flags of convenience" are Panama and Bermuda.

Who Controls Maritime Law?

International maritime law is governed by the International Maritime Organization (IMO). A specialized agency of the United Nations, it is the IMO’s job to establish the framework and regulations for the safety, security, and environmental performance of shipping on an international, universal level.

What Is the Difference Between Maritime Law and Law of the Sea?

Maritime law generally applies to private shipping issues, whereas the law of the sea is largely recognized as referring to public international law. In other words, the latter governs how nations should behave in maritime environments.

The world’s open seas make up about 70% of the earth’s surface and are important, both as a means of transport and as a resource. Maritime law exists to protect this asset and the people who use it. Without it, there would likely be anarchy and collapse of the global economy.

The Federal Maritime Commission (FMC) is an agency responsible for ensuring a “competitive and reliable international ocean transportation supply system that supports the U.S. economy and protects the public from unfair and deceptive practices.”

Formed as an independent agency in 1961, the FMC provides alternative dispute resolution in cases wherein maritime terminal operators, common carriers, or other parties within the ocean shipping industry have disagreements. Among the commission’s staff are administrative law judges who make binding decisions in such cases.

Understanding the Federal Maritime Commission

The Federal Maritime Commission is made up of five commissioners who are appointed by the president and confirmed by the U.S. Senate. The commissioners serve staggered five-year terms, which helps ensure the bipartisan nature of the body; no more than three members of the commission can represent the same political party. The president designates one of the commissioners to serve as the agency’s chair, chief executive, and chief administrative officer.

The commission’s staff is composed largely of attorneys, economists, and ocean transportation experts. Most of the employees work in the agency’s Washington, D.C., headquarters, although the agency also operates six other port-based locations throughout the country.

The FMC performs several functions designed to ensure the fairness and efficiency of ocean-based shipping. These include:

  • Reviewing agreements between ocean common carriers, which transport passengers or goods across international waters, and marine terminal operators (MTOs), which provide loading, unloading, and storage of items at a port

  • Ensuring that such agreements do not result in unfair hikes in transportation costs or a loss of services

  • Offering relief to exporters, importers, and other parties who are harmed by unreasonable ocean shipping practices

  • Providing a dispute resolution process for matters concerning the shipment of cargo and for complaints between cruise vessel operators and passengers

  • Seeking redress when foreign governments or business entities impose unfair business conditions on U.S. exporters

  • Regulating ocean transportation intermediaries (OTIs), which don’t transport cargo or passengers, but often facilitate shipping transactions

  • Ruling on disputes that involve rates, classifications, and practices of common carriers, MTOs, and OTIs

  • Maintaining a fleet of U.S. liner vessels capable of responding to potential international conflicts.

When the commission adjudicates disputes, the rulings are binding for all parties. However, the initial decision can be appealed by any of the parties involved in the dispute or at the request of one of the five commissioners. The FMC would then act as an appellate court, reviewing the case and issuing a final ruling.


Mercantilism's original foundation included beliefs that the world had limited wealth in the form of gold and silver; that nations had to build their stores of gold at the expense of others; that colonies were important for supplying labour and trading partners; that armies and navies were crucial to protecting trade practices; and that protectionism was required to guarantee trade surpluses.

The precursor to free trade economic theory, Mercantilism reigned supreme for three centuries. Mercantilism's theory relating to financial wealth building and state power supported the use of protectionism to increase export revenue and decrease imports. It sparked an age of exploration and colonization in an effort to secure raw materials, controllable trade partners, and a net transfer of wealth.

Mercantilism has been replaced in many parts of the world by free-trade theory and capitalism. However, it's still seen in the tariffs imposed by governments of nations seeking a fair (or unfair) balance of trade with other nations.


1. What is Maritime Law and why is it important?

Ans - Maritime law is the body of rules that govern everything that goes on in the sea and open waters. These rules help clear up various disputes that can occur and ensure that the people and organizations that work on the water behave correctly and are protected.

2. What Is the Mission of the Federal Maritime Commission?

Ans - The Federal Maritime Commission was established in order to ensure a “competitive and reliable international ocean transportation supply system that supports the U.S. economy and protects the public from unfair and deceptive practices.” It carries out that goal by adjudicating disputes between common carriers, shippers, and other parties. The commission also has the authority to impose penalties when U.S. shippers face unfair practices.

3. Are the Federal Maritime Commission's Rulings Binding?

Ans - Arbitration rulings made by the FMC are binding on all parties. However, the commission also has methods of alternative dispute resolution, which are nonbinding. These include offering an ombudsman service and mediation, whereby it helps the parties negotiate business and regulatory matters.

4. Who Serves on the Federal Maritime Commission?

Ans - The Federal Maritime Commission is made up of five commissioners, who serve staggered five-year terms. The commissioners are appointed by the president but have to be confirmed by the U.S. Senate.

5. Are the Federal Maritime Commission's Rulings Binding?

Ans - Arbitration rulings made by the FMC are binding on all parties. However, the commission also has methods of alternative dispute resolution, which are nonbinding. These include offering an ombudsman service and mediation, whereby it helps the parties negotiate business and regulatory matters.

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