What you should know about Precautionary Attachment under Oman's New Maritime Law
Transport & Insurance Focus
The transport and logistics sector in Oman is a fundamental economic pillar that is constantly evolving and growing. In keeping pace with such evolvement, Sultani Decree No. 19/2023 was issued on 30 March 2023.
Law Update: Issue 366 - Transport & Insurance Focus
Ahmed Al BarwaniPartner, Head of Office - Oman
Wassim MahmoudLegal Advisor,Dispute Resolution
The transport and logistics sector in Oman is a fundamental economic pillar that is constantly evolving and growing. In keeping pace with such evolvement, Sultani Decree No. 19/2023 was issued on 30 March 2023 promulgating Oman’s new Maritime Law (the “New Law”). The New Law repeals the old Maritime Law enacted by Sultani Decree No. 35/1981 (the “Old Law”) and the Law Regulating Maritime Navigation in Territorial Waters promulgated by Sultani Decree No. 98/1981, as well as any other related laws and regulations that conflict with its provisions.
In this article, we will shed the light on how the precautionary attachment is regulated under the New Law.
The New Law has been welcomed by the maritime legal market for its comprehensiveness. That is not a coincidence as the New Law, containing 387 articles in nine chapters, covers various aspects of the maritime sector and aims to regulate Oman’s maritime industry, prioritize navigation, seafarer and maritime environment safety, and promote its growth. One of the key chapters of the New Law is Chapter Three: Attachment of The Ship, and in particular, Section One of Chapter Three: Precautionary Attachment.
Although the Old Law regulated the precautionary attachment of the ship, the New Law brings new key changes to such measure.
The precautionary attachment is a form of interim protection in cases of urgency, often exercised by any creditor to satisfy a maritime debt against a particular ship. Precisely, any creditor who has a maritime debt against a ship anchored in the Omani territorial waters, may arrest the ship, irrespective of its nationality, by filling a precautionary attachment application to the competent Primary Court (which is the court at the port where the ship is berthed) seeking an order to arrest the ship to satisfy the maritime debt.
As such, it is predominant to understand, under the New Law, the reasons to qualify the debt as a maritime debt, the ships that may be arrested and the process to be followed in order to arrest a ship in Oman.
Article (67) of the New Law provides comprehensive reasons, where if any of them arises, the debt is considered as a maritime debt and the creditor of such may file for precautionary attachment.
“Precautionary attachment shall be created on the ship in satisfaction of a maritime debt, by a decision of the competent court. The debt shall be considered of a maritime nature if it arises out of any of the following reasons:
Fees of ports and navigational streams, navigational aid fees, royalties and amounts due in relation to the ship;
Damage caused by reason of ship collision, contamination or other marine casualties;
Losses in human lives or physical injuries caused by the ship or arising from its use;
Marine salvage;
General Average Losses;
Ship towage;
Ship pilotage;
Ship insurance;
Contracts governing the use or chartering of the ship;
Contracts for the transportation of cargo by virtue of a Charter Party, a bill of lading or otherwise;
Supply of products or providing the ship with fuel or tools necessary for its use, maintenance or preservation at any destination where the supply takes place;
Building, rebuilding, repair or provisioning of the ship, as well as dry dock expenses;
The remunerations of the captain, officers, seafarers and other persons working aboard the ship under a Seafarer Employment Agreement, including the expenses of their repatriation;
Damage resulting from the loss of or damage to cargo and baggage carried by the ship, as well as the damage caused due to late delivery of cargo and baggage;
Amounts incurred by the captain, Consignors, charterers or Ship's Agents on behalf of the ship or its owner;
The dispute over the ownership of the ship;
The dispute over the co-ownership of the ship and the rights and profits resulting from its use;
Ship mortgage;
The costs of removing a wrecked ship or its wreck with the cargo or other things it carries, re-floating of the stranded ship or moving the same to any other place;
Costs for maintaining the abandoned ship and supporting its crew; and
Maritime affairs service fees.”
It is worthy to mention that clauses no. 1,8, 19, 20 and 21 (highlighted above) are new grounds, introduced by the New Law, of maritime debts. Such grounds were not stipulated under the Old Law.
New reasons of maritime debts under the New Law
Maritime affairs service fees
Additionally, the New Law dotted the i’s and crossed the t’s when it explicitly stated that “providing the ship with fuel” is also considered as maritime debt, as such debate (whether or not the debt resulted from providing the ship with fuel is a maritime debt) was often raised under the Old Law and interpretations varied.
Furthermore, the New Law considers that the remuneration of any person working abroad the ship under a Seafarer Employment Agreement, including the expenses of their repatriation, shall be deemed as a maritime debt. Whereas, under the Old Law, the remuneration of only the captain, officers, seafarers are considered as maritime debt.
Moreover, the New Law recognizes that not only the “damage resulting from the loss of or damage to cargo and baggage carried by the ship” is considered as a maritime debt, but also includes “the damage caused due to late delivery of cargo and baggage”.
Any creditor of a maritime debt has the right to file for precautionary attachment against the ship to which the debt relates. The creditor will have to establish that the debt is a claim of right arising out of one of the grounds stated in Article (67).
The precautionary application must be submitted to the competent Primary Court (usually the Judge of Urgent Matters considers such applications). The Court considers the precautionary attachment application on a prima facie basis and the arrest order is usually rendered, withing (48 hours) from the date of filling the application, on ex-parte basis (where notice is not given to the ship owner/charterer).
Following the issuance of the arrest order, the creditor will have to attend to the competent Court that ordered the attachment within [15] fifteen days from the date of issue of the attachment to prove the validity of debt by all supporting documentation and to request confirmation of the Execution Attachment. The Court shall decide on the request on a summary basis.
Where it is proven that the attachment is valid, the competent Court may order that the ship be sold to satisfy the maritime debt, after a judgment is rendered thereby validating the debt and confirming the attachment. Such judgment may be challenged by way of appeal within [15] fifteen days following its issuance date.
Article (68) provides that the creditor of any of the debts described in Article (67) may apply for attachment of the ship to which the debt relates, or attachment of any other ship owned by the owner at the time of occurrence of the debt, in the event that the ship is managed by its owner. However, no attachment may be imposed on a ship to which the debt is not related if the debt is among those set out in clauses 15,16 and 17 of Article (67).
The New Law also gives the right to the creditor to request attachment of the ship or on any other ship owned by the charterer, if the navigation management of the ship is performed by such a charterer, and the charterer is solely responsible for a relevant maritime debt. However, no precautionary attachment may be imposed on any other ship belonging to the owner of the chartered ship to which the maritime debt relates.
By contrast to the Old Law, where it stated that no attachment may be imposed on a ship ready for sailing unless such attachment is for a debt relating to the voyage that it is about to start (the ship is considered ready for sailing if the captain obtained a permit for it), the New Law has no reference made to such stipulation. This suggests that the precautionary attachment may be imposed against the ship at any circumstances, to the extent permitted by the law.
Al Tamimi & Company have a wealth of experience advising maritime industry players in Oman and represent clients in the maritime related disputes, including the precautionary attachments.
Don’t hesitate to contact us for comprehensive guidance and assistance with any inquiries or concerns regarding the New Law and its impact on your business operations.
For further information,please contact Wassim Mahmoud and Omar N. Omar.
Published in March 2024
