Will dropping registration fee grow Danish flag?

Malcolm Latarche
Malcolm Latarche

05 September 2017


The Danish government’s plan announced today to drop registration fees in a bid to grow the country’s two registers has been welcomed by representatives of the Danish ship owning community.

They say it will remove a costly obstacle that deters owners from registering newly purchased second-hand ships under Danish flag. The fee which is charged at 0.1% for registration and an additional 0.1% for recording a mortgage is a one off fee for all ships joining the Danish flag.

Any reduction in costs is something that hard-pressed owners will be thankful for but whether or not it will be sufficient incentive to achieve the desired purpose is something that many will question.

Based on today’s values, a five-year old second hand Handy ship would cost around $14.5m and a Handymax of the same year around $17m. At 0.1% that would put the cost of registering at $14,500 and $17,000 respectively. Put another way that is less than the cost of a new ECDIS or 50 to 65 tonnes of HFO fuel. Not insignificant sums perhaps but against that must be weighed the fact that the ship would be subject to all of the regulations imposed by the EU on member nations’ ships.

Some of those regulations may unavoidable regardless of flag if the ship operates in European waters but if it will have a much wider trading area, then any of the open registers will probably be a cheaper option in the long run.