articles: Shipping & Transport

Baltic Exchange sale – tax implications

It was announced in August that Singapore Exchange Ltd (SGX) had made an offer to purchase the entire share capital of The Baltic Exchange Limited (Baltic Exchange). This became effective on 8 November and payments are expected to be despatched to shareholders by 18 November. We have summarised the main issues to consider from a tax perspective below. We have also prepared a more detailed factsheet, which can be accessed here http://bit.ly/2eSEIzQ.

Future operating costs survey 2016

Vessel operating costs are expected to rise in both 2016 and 2017. Repairs and maintenance and spares are the cost categories which are likely to increase most significantly in each of the two years. The survey is based on responses from key players in the international shipping industry, predominantly shipowners and managers in Europe and Asia. Those responses revealed that vessel operating costs are expected to rise by 1.9% in 2016 and by 2.5% in 2017.

Shipping must improve risk management

Not enough companies in the shipping industry are following joined-up risk management procedures.

Our second annual Shipping Risk Survey revealed a fall, when compared to last year, in the overall level of satisfaction on the part of respondents that sound risk management had contributed to the success of their organisations. The involvement of senior management in managing risk at the highest level also declined against last year.

New Code of Practice: Cyber Security for Ports and Port Systems

On Wednesday 17 August, the UK Government issued cyber security guidance for ports.

The Code of Practice was commissioned by Department for Transport and developed by the Institute of Engineering & Technology and outlines cyber security requirements at ports and port facilities. The Code of Practice should be used as part of an organisation's overall risk management system, to ensure that the cyber security of port systems is managed both cost effectively and as part of mainstream business.

The Budget 2016 – video summary

A sugar-coated Budget for the next generation

In the uncertain global economic environment, the Chancellor’s deficit-reduction goals have become more challenging. But he still managed to strike an up-beat tone when delivering “a Budget that puts the next generation first”.

Implications of new US lease accounting standard for shipping & offshore maritime sectors

The Financial Accounting Standards Board (FASB) in the United States has issued a lease accounting standard update following the release in January 2016 of an International Financial Reporting Standard (IFRS) dealing with the same subject. Although it had been expected that the FASB and IFRS standards would be identical, there are instead now two standards which, although similar in many respects, contain significant differences. The shipping and offshore maritime sectors will need to assess the effect of these changes on their balance sheets.

Keeping control of the wheel during tough financial times

As shipping companies and the offshore oil services industry feel an increasing financial squeeze, management teams need to take proactive action to keep control of their future.

The offshore oil services industry, for example, has been under pressure since the collapse in the oil price, enduring low charter rates. That pressure will only increase following Iran’s agreement to curb its nuclear programme in return for the removal of sanctions. Crude oil from Iran is not expected to flow freely for several months, but when it does the offshore industry will face even greater challenges in meeting existing debt obligations and conserving cash. Offshore oil services companies would be well advised to take a close look at the options available to them before creditors start taking action for themselves.

Potential tax issues for shipping & offshore maritime sector in UK Autumn Statement

The government is to invest £1.3 billion to transform HMRC into ‘one of the most digitally advanced tax administrations’ in the world. Most businesses and self-employed individuals will be required to keep track of their tax affairs digitally and to update HMRC at least quarterly via their digital tax account. The Government will consult on the details in 2016. 

An Autumn Statement for “rebuilding Britain”

Five years since delivering his first spending review, George Osborne spent over an hour delivering his 2015 Autumn Statement. He repeatedly stated the Government’s intent to build public services, infrastructure, national defences and strong public finances.

Reducing maritime fraud and corruption

Complexity is the friend of the fraudster and an international trade transaction involves multiple parties – buyers, sellers, ship-owners, charterers, ships’ masters or crews, insurers, bankers, brokers or agents.

Shipping confidence levels rise to 2015 high

Overall confidence levels in the shipping industry rose in the three months ended August 2015 to their highest level this year, according to our latest Shipping Confidence Survey. Respondents to the survey were concerned predominantly about low freight rates and overtonnaging, with continuing doubts also expressed about private equity funding.

Small decline in 2014 ship operating costs

Total annual operating costs in the shipping industry fell by an average of 0.8% in 2014. This compares with the 0.3% average fall in costs recorded for 2013. All categories of expenditure were down on those for the previous 12 month period...

Shipping confidence levels rise to 2015 high

Overall confidence levels in the shipping industry rose in the three months ended August 2015 to their highest level this year, according to our latest Shipping Confidence Survey. Respondents to the survey were concerned predominantly about low freight rates and overtonnaging, with continuing doubts also expressed about private equity funding.