Maritime incidents with FOC vessels
A number of case studies are presented in this chapter, depicting
instances of Australian workers losing employment as vessels are re‑flagged
and international seafarers employed. There are also examples of international
seafarers receiving inadequate wages and working in poor conditions.
This chapter details recent incidents in and around Australian waters,
involving FOC vessels and serious instances of poor working conditions,
disappearances and deaths at sea.
It details the challenges with jurisdictional responsibility for
investigating these incidents when they occur in international waters, under an
FOC flag. These issues were discussed by the State Coroner's Court of NSW, in
its inquest into the deaths of Cesar Llanto and Hector Collado, which is also
discussed in this chapter.
Employment of Australian seafarers
Numerous examples have been presented to the committee of Australian
seafarers losing employment, as companies engaging in shipping along the Australian
coast employ FOC vessels and cheaper, overseas crew.
The committee's interim report detailed a number of situations that
illustrated the problem of FOC shipping for Australian seafarers. This included
the replacement of the Australian ship MV Portland and its crew with a
foreign-flagged vessel and a foreign crew, operating under a temporary licence.
Nearly 40 Australian seafarers lost employment, with the replacement foreign
crew reportedly subject to very poor wages and insufficient training.
A number of further, similar examples have occurred since the events on
the MV Portland, where Australian seafarers have been replaced by
foreign crew, and where foreign crew have allegedly received wages far below
Australian legal requirements.
CSL Melbourne and CSL Brisbane
The bulk carrier CSL Melbourne was a vessel that shipped alumina
along the Australian east coast for five years, for the Pacific Aluminium
company, a subsidiary of Rio Tinto. Coming shortly after the incidents on the MV
Portland, in February 2016 it was decided by Pacific Aluminium to send the CSL
Melbourne to Singapore, where the Australian crew were to be dismissed and
the vessel redeployed on international routes. The 16 crew refused to leave the
vessel when it was docked in Australia, an industrial action deemed illegal by
the Fair Work Commission.
Following the crew's refusal to sail the vessel to Singapore, on
5 February 2016 police forced the crew from the ship.
In early 2016 Pacific Aluminium received a temporary coastal licence,
allowing it to use foreign crews on the east coast route. The ITF argued that
the CSL Melbourne would be 'replaced on its coastal route by a
Liberian-flagged ship operated by a Greek company, with Filipino crew'. The
company conversely stated that the decision to reassign the ship was due to the
loss of a long‑term contract, and it would work to reassign Australian
crew members to other vessels in the fleet.
In September 2016, CSL Australia announced that Australian crew would be
removed from the CSL Brisbane, and the vessel instead crewed by foreign
workers, with the company seeking voluntary redundancies across the fleet.
While the ship was dry docked in Singapore, the company advised that it would
relinquish its Australian general licence for the vessel, and return the vessel
to its international fleet sailing around Asia. In instances where the ship was
required to return to Australian waters, the company would apply for a
The vessel has since been renamed Adelie, and is registered to
the Bahamas. Records indicate that between March and May 2017, the Adelie
made at least five port calls to Geraldton in Western Australia.
The MUA argued that Rio Tinto had failed to adhere to a 2010 agreement
that it use Australian‑flagged ships and crew on 70 per cent of
its fleet carrying bauxite from Weipa in north Queensland to the port of
Gladstone. The MUA estimated that 70 per cent of Rio Tinto's fleet
operating between Weipa and Gladstone were instead under FOCs, with crews from
Burma, India or the Philippines paid $3 to $4 an hour. The MUA stressed that in
challenging Rio Tinto's position, it was seeking better conditions for all
seafarers, regardless of nationality.
More generally, there have been claims that CSL sought to fill up to
three dozen positions with foreign workers under the 457 visa program, thus
failing to comply with legal obligations to prioritise local workers. The
Australian Institute of Marine and Power Engineers argued that there were at
least 250 unemployed marine engineers in Australia, and that these engineers
should be employed over 'cheaper' foreign workers. CSL responded that while its
advertised positions called for Australian citizens and permanent residents, it
would 'give genuine consideration to all applications'.
Incidents in Australian waters
While the use of FOC vessels is a problem for the global shipping
industry, serious risks to seafarer safety and national security have been
demonstrated by the operations of FOC vessels in Australian waters.
This was highlighted by the events around the MV Sage Sagittarius,
an FOC vessel where two crew members died in a short period of time and under
suspicious circumstances, and where a company investigator into these deaths
also later died.
A NSW Coronial Inquest into the two deaths recently found that both crew
members had met with foul play, and highlighted the issues involved in
investigating disappearances or deaths on foreign‑flagged vessels.
In recent years and since these matters were canvassed in the interim
report, further incidents involving FOC vessels have occurred in Australian
waters, often involving stranded, underpaid or missing crew or presenting risks
to Australia's security. The following examples provide an account of the
varied and numerous issues that FOC vessels present to Australian authorities.
On 10 July 2016, the Tuvalu-flagged vessel OS 35 docked at
Gladstone, Queensland. It was reported that the crew of 19 Syrian sailors were
given permission to leave the ship at port, despite only one of the crew having
a valid visa as the ship approached the port. In response, the Department of
Immigration and Border Protection (DIBP) argued that while 18 crew did not have
proper clearance when discovered by Border Force off the Queensland coast, the
crew was assessed prior to arrival. All crew had passed security clearance by
the time of arrival at the port.
The ITF argued that the only way the security clearances could have
been obtained was through officials communicating with Syrian counterparts, and
it was unlikely that Syrian officials were in a position to respond to Border
Force so quickly.
Five Stars Fujian
On 19 July 2016, the Chinese-bound Hong Kong‑flagged cargo ship Five
Stars Fujian and its crew was abandoned off the port of Gladstone. The ship
was detained by Australian authorities after sitting idle for weeks. While
holding about $40 million worth of coal, the ship's crew had not been paid
in months, and were paid $2 an hour when wages were paid, in breach of ILO
The crew were running out of food following the abandonment, and
emergency supplies were provided by AMSA. On 12 August 2016 AMSA inspected the
ship, and detained the vessel for deficiencies in relation to food supply and
payment of wages.
On 1 September 2016, AMSA released the vessel following confirmation
from the vessel owners that the outstanding wages had been paid, and the vessel
had sufficient fuel and provisions for the trip to China. AMSA further banned
the operators from bringing the ship to any Australian port for a twelve-month
The cargo ship Maratha Paramount is Indian‑owned and
flagged to the Marshall Islands. As with the CSL Melbourne, the Maratha
Paramount was chartered by Pacific Aluminium as a wholly‑owned
subsidiary of Rio Tinto. In October 2016, the vessel was detained in Gladstone
and boarded by Australian authorities who were investigating claims that the
crew had not been paid, and were living in squalid conditions.
The vessel carried 22 Indian crew members who had not been paid for
over two months. AMSA inspectors found that the captain had asked the crew to
sign off on having received wages, despite not having received them.
Additionally, there was very little food on board the vessel, and the drinking
water was discoloured.
AMSA issued the vessel with two deficiency notices, for failing to pay
wages for two months, and for failing to provide the crew with clean
facilities. The ship was released by Australian authorities and was subject to
a follow-up inspection when it arrived in the Newcastle port. The ITF called
for the suspension of the Maratha Paramount's temporary licence, which
allowed it to travel domestically between the Gladstone and Newcastle ports.
Deaths and disappearances at sea
In instances where a seafarer disappears or dies while working on an FOC
vessel in Australian waters, it is often difficult to discern which
investigatory or oversight body may have jurisdiction to examine the case. A
disconnect between the ship's physical operating location, and its flag nation,
both creates and exacerbates this problem.
A number of incidents in Australian waters have highlighted both the
serious risks to crew working on FOC vessels, and the lack of jurisdiction for
further investigation into serious instances of injury, disappearance or death
involving FOC ships.
The following examples provide evidence of jurisdictional issues, and
the lack of investigational responsibility taken on by the registered flag
nation, in instances of disappearance and death at sea.
In May 2015, the Panamanian‑flagged coal vessel K Pride was
off the coast of Papua New Guinea and travelling to Newcastle when a 54‑year‑old
seafarer fell overboard and was presumed dead. It reportedly took 3 hours
before fellow crew noticed the seafarer missing, and, while the incident
reportedly happened on 14 May 2015, local union officials were not
notified until 25 May 2015.
The ITF noted that as the incident occurred in international waters, it
was unlikely to be investigated by Australian authorities, despite the vessel
heading to Australia and travelling regularly between Newcastle and Korea with
The Korean owner of the vessel, SK Shipping, told media that there would
be an investigation, involving Australian police. However, the AFP said they
were not involved, and referred the matter to the NSW Police Force.
NSW Police later boarded the ship while it was docked in Newcastle, to
interview crew as part of an investigation. AMSA also boarded the vessel for a
'routine follow-up Port State Control inspection'.
It appears to the committee that no further details on this matter have
been released, or findings of any investigation announced. Notwithstanding the
Australian investigatory efforts, the committee notes that as the vessel was in
international waters, the primary investigative responsibility lay with the
flag nation of Panama.
On 30 April 2016, the Japanese‑owned Panamanian-flagged iron ore
bulk carrier Spring Hydrangea was in international waters, off the
Pilbara coast in Western Australia. A Filipino crew member, Mr Robert Bantol,
went missing, and this was reported to AMSA. AMSA undertook sea and air
searches to no avail, and medical advice concluded that Mr Bantol could not
Given the location of the vessel, the obligation for investigation
rested with the flag nation, in this instance Panama. While on 2 May 2016 the
Panama Maritime Authority reportedly commenced an investigation, the ship was
sold soon after, its flag nation changed to Liberia in West Africa, and its
name changed to the MV Monegasque Eclat, frustrating the prospect of any
further investigation into the disappearance.
The family of Mr Bantol urged Australian authorities to investigate,
arguing that Mr Bantol was supporting a young family and would not have jumped
overboard. Despite this and other calls for an Australian investigation into
the disappearance, the Minister for Justice the Hon Michael Keenan MP advised
that it was up to the AFP to determine what cases they investigate. However,
the AFP advised the media that it wasn't involved in the matter, and both the
ATSB and Western Australia Police confirmed they were not investigating the
It was later reported that the Japanese shipping company that owned the
vessel had refused to investigate the disappearance, and was refusing to pay
compensation to the seafarer's wife and two children.
On 12 January 2017, the SBI Samba, a Greek‑owned bulk
carrier flagged to the Marshall Islands, was off the Australian coast at Hay
Point, Queensland when a 47‑year‑old Filipino crew member went
missing. There was approximately four hours between the time when the crewman
was last seen and then reported missing. Following the missing person report,
AMSA undertook an extensive search of the area. The search ceased when it was
determined that the seafarer could not have survived.
During the second day of the search, the SBI Samba reportedly
left the search area of its own accord, to head to port and load cargo, leaving
Australian authorities to continue the search. The ITF demanded an immediate
investigation into the seafarer's disappearance.
The shipping company claimed that it would leave the 'missing person'
investigation to the AFP, who in turn advised that the Queensland Police were
leading the investigation. Queensland Police boarded the vessel at the port at
Hay Point, ruling that the death was not suspicious. The crewman is thought to
have disappeared after 'consuming a toxic substance', on which the police were
unable to elaborate.
MV Sage Sagittarius and Coronial findings
The NSW Coronial Inquest into the deaths of Cesar Llanto and Hector
Collado, who died under suspicious circumstances while working on board the
Panamanian-flagged MV Sage Sagittarius, identified concerns with
jurisdictional responsibility when deaths occur at sea. In relation to FOC
vessels, the Deputy State Coroner, Magistrate Sharon Freund, found that:
there is no apparent connection between the nationality of
the owner of the Vessel, the ordinary geographical operations of the Vessel,
nor the nationality of the crew of the Vessel and its flag. The Panamanian Flag
is a "flag of convenience" which allows the ship owners to operate
principally under the regulatory framework of the flagged nation.
As part of the Inquest findings, the Deputy State Coroner found that:
there are very significant practical impediments created by a
disappearance or a death on board a foreign flagged vessel. Many thousands of
foreign seafarers, including many Filipinos, work on foreign flagged vessels
that venture into Australian waters in the course of trade.
The Deputy State Coroner noted that the 'Ships of Shame' report detailed
the 'significant practical impediments to investigating suspected lawlessness
that may take place on a foreign flagged vessel', but that:
It is essential...that such investigations take place and be
done thoroughly. Lawlessness, wherever it takes place, should always be
investigated. Persons at fault should be brought to account wherever the
The Coronial Inquest found that while the AFP and the NSW Police Force
did their best in investigating the disappearances and deaths on the MV Sage
Sagittarius, investigators faced difficulties for a number of reasons.
a bifurcation of investigations, as the AFP investigated the
disappearance of Mr Llanto under the Crimes at Sea Act 2000 while the
NSW Police Force had investigative jurisdiction for Mr Collado;
actual or perceived time pressures on investigators, as the
vessel was a commercial coal loading ship with commercial engagements, which
also prevented the re-engagement of witnesses; and
the relevant witnesses were Filipino nationals who required an
interpreter, and some felt intimated or scared enough based on their
experiences on the vessel to withhold evidence.
DIBP confirmed to the committee that the Australian Customs and Border
Protection Service (ACBPS) and later Australian Border Force (ABF) did not have
any jurisdiction to investigate the deaths of Mr Collado and Mr Llanto.
Responses to jurisdictional issues
In responding to the incident on the SBI Samba, Mr Dean Summers
of the ITF spoke strongly about the issue of seafarer deaths at sea and the
Too many times foreign seafarers have lost their lives and
their employer [sic] use the excuse Man Over Board to avoid a proper
investigation. These tragedies go under‑reported, demonstrating to the
world that these employers think international seafarers are a disposable
Under the lawless FOC system, the country where the ship is
registered has the responsibility to investigate. If this happens at all in FOC
countries like North Korea, Panama, Mongolia and the Marshall Islands, the
reports are scant and incidental.
The Coronial Inquest into the deaths of Hector Collado and Cesar Llanto
recommended a number of measures that would go some way to improving the
investigation of deaths at sea.
The Deputy State Coroner recommended the establishment of a permanent
standing group with members from at least the AFP, NSW Police Force, AMSA and
ATSB, 'for the purposes of liaising, contact and assistance in connection with
any investigation of the death or suspicious death on board, or disappearance
from, an international vessel in or bound for Australian waters'. The standing
group would have a principal contact officer from each agency, who would
regularly liaise with the group to ensure the appropriate sharing of forensic
and other evidence between agencies during an investigation.
In responding to questions taken on notice, DIBP acknowledged that a
number of reviews and inquiries had identified issues with lack of
communication between agencies in such circumstances. While DIBP was not
considered as part of the Inquest recommendations, DIBP advised that the ABF
created a Border Intelligence Fusion Centre (BIFC) which
brings together representatives from:
Australian Federal Police
Australian Criminal Intelligence Commission
Attorney General's Department
Department of Education, Employment & Workplace Relations
Department of Foreign Affairs & Trade
Department of Environment & Energy; and
Department of Infrastructure and Regional Development.
The BIFC, established on 1 July 2016, provides 'real time profiling and
targeting intelligence analysis and advice to support the ABF in making
intelligence informed operational decisions'. DIBP also argued that the
commencement of the department, from 1 July 2015, allowed for border
and visa threats to be considered simultaneously, rather than in isolation.
Committee view and recommendations
The committee is very disturbed by the many examples of job losses, poor
working conditions, inadequate wages and deaths and disappearances at sea, both
presented here and in other examples provided in evidence throughout the course
of the inquiry.
To have seafarers disappearing and dying in and around Australian
waters, and while in transit to Australian ports, is unacceptable. While it
will take a global effort to prevent deaths at sea and improve the working
conditions of international seafarers, Australia can and should be doing its
part to improve conditions where it can, and when these tragedies occur in our
Australian authorities have provided extensive assistance in search and
rescue operations, as soon as disappearances at sea are reported to them.
However, the apparent disconnect between a ship's flag state and its physical
location has resulted in a situation where there are no follow‑up
investigations. In effect, there is a lack of accountability for events that
take place on board FOC vessels.
The job losses of Australian seafarers, and their replacement by foreign
crews, is removing trained, skilled and specialised local workers from coastal
shipping and key freight routes, and reducing Australia's ability to
reinvigorate its maritime industry.
The case studies presented clearly show the critical issues with
jurisdictional responsibility into investigating disappearances and deaths at
sea. While flag states have a responsibility to investigate all incidences on
their vessels, it is only too apparent that this is not happening.
Further, Australian authorities do not always have clear authority to
investigate matters in international waters, even if an FOC vessel regularly
enters Australian waters and transports Australian products.
The government needs to address this serious issue. As noted by the NSW
Deputy State Coroner, lawlessness should always be investigated, regardless of
jurisdiction, and accountability enforced.
The committee hopes that the creation of the permanent standing group of
relevant authorities, as recommended by the Deputy State Coroner, and the BIFC,
go some way to addressing the serious jurisdictional issues that are
encountered when investigating deaths that occur in Australian waters.
The committee takes the view that, alongside the important work of the
standing group, there would be benefit from having clear guidelines and
procedures put in place to direct authorities on how to respond to deaths at
sea, and how to engage efficiently and effectively with a vessel's flag state.
The committee strongly urges the Australian Government to consider
whether governing legislation for federal investigative authorities could be
amended, to provide clearer guidance on jurisdictional responsibility, and to
best ensure that deaths at sea can be appropriately investigated from beginning
to completion. The government should progress issues over state jurisdiction
The committee recommends that the Australian Government implement clear
guidelines and procedures to direct authorities on how to respond to deaths
that occur on shipping vessels travelling in or to Australian waters, including
how to engage with a vessel's flag state in a timely manner to progress
The committee recommends that the Australian Government consider any
possible amendments to legislation governing federal investigative authorities,
to provide clarity on jurisdictional responsibility for investigating deaths at
sea, when they occur on shipping vessels travelling in Australian waters. The
Australian Government should progress jurisdictional issues with the states and
the Northern Territory at COAG to ensure satisfactory outcomes.
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