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Tax havens and worker exploitation: Baltimore bridge disaster gives glimpse into 'murky world' of shipping
By Josh Robertson

Posted 1h ago1 hours ago

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The Francis Scott Key Bridge was one of three river crossings.(Reuters: Julia Nikhinson)
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abc.net.au/news/ship-owner-in-baltimore-bridge-tragedy-vessel-banned-australia/103642216 6park.com
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In short: A shipping company at the centre of the Baltimore disaster had another vessel banned from Australian ports in 2021 for worker exploitation.The Australian Maritime Safety Regulator found the ship's operator had unlawfully underpaid workers and kept them on board too long.The Dali is owned by a company in secretive tax haven, the British Virgin Islands.
The owners of the ship at the centre of the Baltimore bridge disaster in the US had another vessel banned from Australian ports over unlawful exploitation of workers.
The Dali, a 300-metre container ship which accidentally destroyed a bridge, causing the presumed deaths of six people and blocking a major US trade route, is owned via a secretive tax haven company in the British Virgin Islands called Grace Ocean Investment Limited.
Another ship that belonged to the company was slapped with a six-month ban in 2021 for what the Australian Maritime Safety Authority said were "serious and shameful breaches" of maritime labour laws.
The operator of the Western Callao was forced to hand over about $40,000 in unpaid wages to 13 seafarers.
AMSA detained the same ship at Port Kembla in New South Wales in July 2020, finding the operator had unlawfully kept eight seafarers on board for more than 11 months.
Another of the company's ships, the Furness Southern Cross, had also unlawfully kept 10 seafarers on board for more than 14 months.



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Francis Scott Key Bridge in Baltimore collapses after ship collision.
Days after its ban from Australian ports, the Western Callao was sold off by its owner.
The Dali is run by a different operator but owned via the same tax haven company. 
The international union representing seafarers says the case of the Dali offers a glimpse into the "murky world" of global shipping where big players use tax havens and "flags of convenience" to evade regulatory scrutiny.
The collision in Baltimore on Tuesday, which triggered the collapse of the Francis Scott Key Bridge, was the Dali's second major accident in nine years at sea.

Baltimore bridge disaster
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A search for six road workers who were on a bridge that was brought down by an out-of-control container ship in the US city of Baltimore has been suspended until tomorrow morning. 6park.com
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Built in 2015 and originally registered in the Marshall Islands, the Dali was at the Port of Antwerp-Bruges in Belgium a year later when it ran into a steel quay.
The ship, which suffered hull damage and was held for repairs to make it seaworthy, had a different owner and operator at the time.
The Dali is now registered in Singapore, where it's owned by a subsidiary of the BVI-registered Ocean Grace.
The Singapore subsidiary owns 55 ships in total, according to online shipping database Equasis.
Corporate records show the subsidiary has three directors based in Singapore: Tock Hin Anthony Heng, a Singapore national; Oliver Pabalan Espino, a Filipino national; and Yoshimasa Abe, a Japanese national.
It was Mr Abe who signed an agreement in July 2020 for the company with a Singapore union guaranteeing conditions for maritime employees on ships including the Dali.
It also included the Western Callao, which was banned from Australia the following year for underpaying seafarers. 
The ABC called Mr Abe and emailed questions but he did not respond. His co-directors could not be reached.
Grace Ocean, which bought the Dali months after its Belgian accident in 2016, uses another Singapore company, Synergy Group, to operate the ship.
In a statement, Synergy said the Dali had collided with a pillar of the bridge at Baltimore "whilst under pilotage with two pilots onboard", referring to local mariners responsible for boarding and guiding the ship safely out of the harbour.
Synergy said the "exact cause of the incident was yet to be determined [and] the owners and managers are fully cooperating with Federal and State government agencies".


The ship was bound for the Sri Lankan capital, Colombo, where it was due to arrive on April 22.
It had spent three days in dock at Baltimore, having arrived via Norfolk and New York after travelling through the Panama Canal earlier this month.
The ship's last recorded inspection by authorities was by the US Coast Guard in New York last September, according to Equasis.
Tax havens and 'flags of convenience'
Ian Bray, the Australian coordinator of the International Transport Workers Federation, said the costly, and likely deadly mishap in Baltimore shone light on a global shipping industry that often made it hard to hold big players to account.
Mr Bray said US investigators could take months and would work out if it was "human error or mechanical error".
If the latter, investigators would examine how often engines and generators on the ship were inspected and maintained.


Mr Bray said there was some evidence of systemic issues with ship operators cutting corners on maintenance, with AMSA banning several ships last year over poor maintenance programs.
"Whether it's the owner with a direct hand on it or whether it's an indirect hand through a management company, ultimately the buck has to stop somewhere in the management system," he said.
"But it's quite often the case that that registry of ownership with a particular company is probably a subsidiary company of another company, that's a subsidiary of another company.
"There's been times where we've gone and tried to map who actually owns something and it is very, very opaque … because it's designed to be that way." 6park.com
Mr Bray said the industry was rife with big players using tax havens and "flags of convenience", registering ships in different countries from where they were owned.
"It's about tax minimisation, first and foremost with all of these corporations but it's also escapism from any regulatory regime that has any teeth," he said.
"You talk about mechanical failures and these kinds of things because it's on the TV in front of you at night.
"But the basics of this [system] too, is it makes it easier to exploit the workforce.
"It's a very, very murky world. And the global powers that be need to put five minutes attention on it and turn a spotlight on it to actually have a look at what's going on."



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An aerial view of the aftermath of the Baltimore bridge collapse.
'Minor' disruptions for Australian imports
The suspension of Baltimore's shipping operations has fanned fears of more of the kind of supply chain disruptions which have fed into global inflation since the COVID pandemic.
Baltimore is the largest car terminal in the US and its ninth biggest port for international cargo.
However, local supply chain experts told the ABC that Australia would be largely spared the fallout.
Professor Michael Bell, a transport expert from the University of Sydney, said there could be "minor" disruption to Australian car imports.


"The biggest effect, I think, on Australia may be via the car carrier network," he said.
"That's the only one I can think of. There may be general disruption in container shipping [but] not enormous, I would think."
Brian Hack, the managing director of Perth-based freight company EES Shipping, said it was "not a big thing that should impact Australia".
"It's just one of the lots of little things that just add to the overall issues that seem to be rocking down the whole supply chain and have been for the past however many years since Covid kicked in." 6park.com
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