HC stays Centre notification on commercial rights of ships

  1. The Delhi High Court has stayed a Central government notification under the ‘Make in India’ programme under which an Indian-built ship gets commercial rights higher than an Indian flag vessel in securing Indian business.
  2. The Court said that the Merchant Shipping Act 1958 under which the notification was issued was not concerned with the place where the ship was built rather it was concerned only with the ownership of the ship.
  3. The petition was filed on the grounds that the regime post the notification created a scenario when an Indian flag vessel owned and offered by an Indian citizen is placed on the same pedestal as a foreign flag vessel offered by an Indian citizen.
  4. Recently,the Central Government had amended the Right of First Refusal(ROF) policy.The amendment shifted the balance of power in favour of Indian-built ships from Indian-flagged ships irrespective of whether such Indian-built ships are offered by Indian or foreign companies.
  5. Further,the sequencing of RoFR priority was Indian-built vessels followed by Indian-flagged vessels.In case none of the bidders under the first and second priority eligible to exercise the RoFR,matches the lowest rate quoted by a foreign ship owner offering a non-Indian built ship in a tender then the charter shall be awarded to the lowest bidder.

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