Cabotage Draft Law Causes Friction

The bill promoted by the government for the lifting of cabotage restrictions is a historical reform for the Greek cruise industry, Economy, Competitiveness and Shipping Minister Louka Katseli said last month.

Following a public consultation of interested parties on the planned changes to cabotage restrictions, Mrs. Katseli briefed the members of the Permanent Production and Trade Committee on the draft law entitled “Execution of cruise ships by ships with flags of third countries with a Greek Port as the starting point.”

“Right now Greece is the only European country that fully bans foreign-flag cruise ships to homeport in Greece,” the shipping minister said.

According to the draft law, non-European Union-flag (third country flags) cruise ships would be equated with what applies for E.U-flag ships.

Ships carrying out cruises would be obliged to carry more than 49 passengers and the duration of the trip must be at least 48 hours, while the stay at the Greek port, being the starting point, must be at least 12 hours.

Shipowning companies would sign a three-year contract with the Greek government that can be extended and arranges issues such as the employment and insurance of Greek seamen employed on the ships.

A special levy would also be imposed on every passenger boarding at the trip’s starting port. The proceeds of this levy would support an unemployment fund of the seafarers.

The Association of Greek Tourism Enterprises (SETE) criticized some points of the draft law, which simply “perpetuates the cabotage problem.”

SETE described the conditions as lacking clarity as well as the government’s willingness to actually liberalize the cruise sector in Greece.

“Yet another opportunity for the development of cruise tourism and stimulation of the national economy will be lost at a time when our country needs it more than ever,” SETE said.

Meanwhile, the Hellenic Chamber of Shipping, the Hellenic Chamber of Hotels and the Central Union of Greek Chambers recently said in a joint press release that the lifting of cabotage restrictions for non-E.U. flagged cruise ships should be implemented without terms and conditions.

According to the chambers, if the cabotage law were lifted the minimum annual benefit for Greece would be some 1.16 billion euros along with the creation of some 15,000 new job positions.

“The irregularity of the Greek legislative framework on cruise ships is responsible for the reduction of the number of Greek-flagged ships and has deprived the country of precious resources,” the chambers said.

(The cruise ships of Cyprus-based Louis Cruises Lines are the only ones flying the Greek flag.)

On his part, Hellenic Federation of Hoteliers President Andreas Andreadis referred to the draft bill as a “non-functional and timid approach.”

“The draft law simply confirms the lack of clear goals and determination on the government’s side of actually lifting the cabotage restrictions,” Mr. Andreadis said.

Prime Minister George Papandreou had announced in April that his government would abolish cabotage and allow non-E.U. flagged cruise ships to be based at Greek ports.

The Panhellenic Seamen’s Federation (PNO) opposes to the abolition of cabotage as it fears such a move would lead to wage and job cuts.

The cabotage draft law was tabled in Parliament on 20 July.