An extract from The Shipping Law Review, 7th Edition

Commercial overview of the shipping industry

The shipping industry has for centuries played an important role in the United Kingdom's island-nation economy. As at December 2019, the UK Ship Register was ranked 24th on world fleet tonnage volume statistics, with a gross tonnage of 10.5 million. In economic terms, shipping accounts for 95 per cent of exports and imports and is reported to help support £37.4 billion in gross value added each year in the UK. The wider maritime sector also contributes approximately £14.5 billion and 185,000 jobs to the UK economy every year. According to the most recent statistics, total port freight traffic through the UK's major ports between April and June 2019 was 476 million tonnes.

General overview of the legislative framework

England and Wales is a common law jurisdiction where the legal framework is founded upon a mixture of case law and legislation. Shipping law in particular has historically been developed primarily by decided cases, although there are statutes in key areas. The Merchant Shipping Act 1995 (the MSA 1995), consolidating previous statutes dating back as far as 1894, is a particularly important piece of overarching legislation in this field and various statutory instruments have been made under it.

International conventions that are ratified by the United Kingdom are usually implemented through domestic legislation. The United Kingdom has ratified all the major international maritime conventions.

While the United Kingdom remains a member of the European Union, regulations and directives made by institutions of the European Union have either a direct or indirect effect in the jurisdiction of England and Wales. A referendum on the UK's membership of the European Union was held in June 2016, in which the majority voted to leave the European Union. Following the triggering of Article 50 in March 2017, the UK left the EU in January 2020 and is currently in a transition period, which ends on 31 December 2020. During the transition period, EU regulations continue to apply in the UK. After 31 December 2020, EU regulations will not have effect in the UK unless expressly implemented into UK law. Unlike EU directives, which are left to Member States to implement by way of national legislation, regulations are automatically and directly applicable in Member States. UK legislation dealing with matters covered by directives could therefore remain substantively unaltered, as the UK laws passed to implement them will remain in place, potentially requiring only minor changes. However, any critical gaps currently covered by regulations will need to be addressed by new domestic legislation. While the outcome of negotiations between the United Kingdom and the European Union is impossible to predict, Brexit could potentially affect a number of areas. These could include the return of border controls, the loss of the right for UK entities to perform cabotage services throughout the European Union and the loss of 'passporting' rights for the UK's marine insurance and ship finance sectors.