Ship arrests in Belgium – essential statute law

Introduction
Different arrest regimes
New Belgian Maritime Code
Legal basis in Belgium
Abrogated provisions
What you see is not what you get
Ship arrests: a teaser

Introduction

The three main purposes of ship arrests are:

• protection – placing the vessel under detention while awaiting a court decision on an underlying claim;
• jurisdiction – forum arresti justified by convenience; and
• security – giving a creditor the possibility to a right of security in the ship.(1)

Different arrest regimes

Ship arrest regimes include:

• international regimes (multilateral treaties) – namely:
  • the Ship Arrest Convention (Brussels) 1952 (71 signatory states); and
  • the Ship Arrest Convention (Geneva) 1999 (11 signatory states); and
• national regimes (local law):
  • based on (some of) the principles set out in the above conventions; and
  • based on purely national principles.

The arrest of a vessel involves the local implementation of a national or international rule of law. Even if international rules are the same in different jurisdictions, their application may differ from country to country.

New Belgian Maritime Code

The new Belgian Maritime Code (NMBC) was passed on 4 April 2019 and came into force on 1 September 2020. The NMBC includes the following changes to the law on the arrest of sea-going vessels:

• material law – arrests can now be made for non-maritime claims; and
• formal law – the legislation on the arrest of sea-going vessels has moved move from the Judicial Code to the NBMC (Articles 2.2.6.1 and following).

Legal basis in Belgium

At present, the legal basis for ship arrests in Belgium is as follows:

• Article 1,467 of the Judicial Code, which states that a "[j]udge may allow a conservatory attachment on sea-going ships and interior barges which are in his jurisdiction" (Article 4 of the Arrest Convention 1952 and Article. 2.1 of the Arrest Convention 1999).
• Article 1,468 of Section 1 of the Judicial Code, which states that: "[w]hen the request for attachment regards a sea going vessel it may only be allowed to guarantee a maritime claim" (Article 2 of the Arrest Convention 1952 and Article 2.2 of the Arrest Convention 1999).
• Article 1,469 of Section 1 of the Judicial Code, which states that:

either the particular ship in respect of which the maritime claim arose, or any other ship which is owned by the person who was, at the time when the maritime claim arose, the owner of the particular ship may be attached, even though the ship arrested be ready to sail (Article 3.1 of the Arrest Convention 1952).

• Article 1,469 of Section 2 of the Judicial Code under which when in the case of a charter by demise of a ship, the charterer and not the registered owner is liable in respect of a maritime claim relating to that ship, the claimant may arrest such ship or any other ship in the ownership of the charterer by demise, but no other ship in the ownership of the registered owner will be liable to arrest in respect of such maritime claim. This paragraph applies to any case in which a person other than the registered owner of a ship is liable in respect of a maritime claim relating to that ship (Article 3.4 of the Arrest Convention 1952).

Abrogated provisions

The NBMC abrogates Articles 1,467 to 1,480 of the Judicial Code. The following similar or identical provisions to the abrogated provisions have been incorporated in the NBMC:

• Article 1,467 of the Judicial Code becomes Article 2.2.6.4 of the NBMC;
• Article 1,468.1 of the Judicial Code becomes Article 2.2.6.4 of the NBMC; and
• Article 1,469 of the Judicial Code becomes Article 2.2.6.5 of the NBMC.

What you see is not what you get

In addition to the Judicial Code and the NBMC, the following legislation is also relevant:

• the Act of Incorporation of the Arrest Convention 1952;
• the Arrest Convention in its original languages; and
• the preparatory papers of the International Maritime Committee to that convention.

This combination of legal text consisting of international conventions, national and regional legislation is typical in transport matters.

Ship arrests: a teaser

Arrests and corporate law
Piercing the corporate veil
If one company is held liable for the debts of another, the courts will allow such a piercing of the veil when the separation between the companies is purely fictitious and the structure's only purpose is to escape creditors.(2)

Piercing the corporate veil abroad or alter ego liability
For example, where one party has used another to perpetuate fraud or has so dominated and disregarded the other party's corporate form that the other party primarily transacted the alleged alter ego's business rather than its own.(3)

Insolvency
Ship arrests for insolvency generally concern:

• an arrest for a low claim (less than £260,000);
• a refusal to act swiftly and the shipowner's overconfidence;
• a waterfall of subsequent arrests; and
• the bankruptcy of a group worth more than $1 billion.

For further information on this topic please contact André Kegels at Kegels & Co by telephone (+32 3 257 1771) or email (andre.kegels@kegels-co.be). The Kegels & Co website can be accessed at www.kegels-co.com.

Endnotes

(1) Ruiz Abou-Nigm, V, The arrest of ships in private international law, Oxford, 2011.

(2) Antwerpen, 27 June 2011, ms ATLANTIC GALAXY p29 (punt 4.8).

(3) MAG Portfolio Consultant, GMBH v Merlin Biomed Group, LLC 268 F.3d 58, 63 (2d Cir 2001) and Chalos and D'Ambrosio, Alter Ego Allegations and Liability: Recent Decisions & Risks for the Shipping Industry, The Arbitrator, 4 November 2011, p 10.