Birds and Marine Wildlife / 81“fl ags of necessity” or, less neutrally, “fl ags of convenience,” vessel
owners can legally circumvent the rules. Briefl y, the fl ag that a ship
fl ies designates the laws that apply to it. A vessel owner can register
a ship through a “phantom” company, even one existing only out
of a fi ling cabinet, in a country whose regulations are favorable or
profi table. Proponents argue that open registry is the only way ship
owners operate profi tably. Owners in one country can gain access
to fi nance in another and a crew in yet another. Environmentalists
and maritime labor organizations counter that fl ags of convenience
allow shippers to avoid taxes, hire non-union crews, and skirt envi-
ronmental regulations. Although not all shippers who use fl ags of
convenience intend to engage in corrupt practices, the system nev-
ertheless “enables less scrupulous operators to register their ships
under fl ags which they know will not require full compliance with
international rules.”^59
Open registry has signifi cant implications for oil spill preven-
tion, accountability, and compensation. The 2002 case of the aging
tanker Prestige offers a good example. The vessel broke in half in
severe weather and caused Spain’s worst environmental disaster.
It was carrying about twenty million gallons of fuel oil, which is
a heavy blend gathered from the bottom of tanks after refi ning.
Fuel oil is highly toxic and viscous, making it both hazardous and
extremely diffi cult to clean up. The vessel itself was registered in
the Bahamas but owned by a Greek family allegedly operating
through a company based in Liberia. The petroleum cargo of the
Prestige belonged to a Russian company based in Switzerland but
operating through a British agent. The ship had a Filipino crew. The
estimated impact of the spill in Spain, Portugal, and France is $900
million. The owners of the Prestige carried the minimal $25 mil-
lion insurance for clean-up costs, and international maritime law
caps the owner’s responsibility at $80 million. The International Oil
Pollution Compensation Funds, which provide assistance through
fi nes levied on the oil industry, had only $186 million available.
Although the captain and offi cers of the Prestige were arrested,
the owners and the oil company went unpunished. The issue of
accountability raised numerous moral and logistical questions. One