A maritime mortgage is a contractual security which gives the creditor a real right over the vessel; the mortgage must be registered in each national register of maritime by the competent administrative authority, which is responsible for preserving and publicizing it.
Registration preserves the mortgage for 10 years from the date of registration. Its effect ceases if the registration has not been renewed before the expiry of this period on the register of the competent administrative authority. The registration guarantees two years’ interest in addition to the current year, ranking pari passu with the principal.
Ships and other seagoing vessels registered in each C.E.M.A.C. member state may be mortgaged. They may only be encumbered by conventional mortgages. To be valid, mortgages must be constituted in writing. The mortgage deed may be authenticated or signed by a private party. It may also be a promissory note: in this case, endorsement entails translation of the mortgage right.
Mortgages may only be granted by the owner of the building or by his or her authorized representative with a special power of attorney.
A mortgage may be granted on a seagoing vessel under construction.
A mortgage granted on a vessel or on an undivided share thereof extends, unless otherwise extends, unless otherwise agreed, to the body of the vessel and all accessories, machinery, fittings and fittings. It does not extend to freight.
If the vessel is lost or damaged, the following are subrogated to the vessel and its accessories for the amount of a mortgage claim:
a) Compensation due to the owner for material damage to the vessel;
b) Sums due to the owner for contribution to general average suffered by the vessel;
c) Indemnities due to the owner for assistance rendered or salvage carried out since the registration of the mortgage, insofar as they represent the loss or damage of the mortgaged vessel;
d) Insurance indemnities on the ship’s hull.
Before any payment is made, the insurer must request a statement of mortgage registrations.
No payment shall discharge the insurer if it is made in disregard of the rights of creditors appearing on the said statement.
Payments made in good faith before opposition are valid.
A maritime mortgage on a vessel flying the flag of a member state shall be registered in the register referred to in article85 by the competent administrative authority of that authority of that Member State, which shall ensure its preservation and the purging and/or deletion.
The register must be accessible to the public; at the request of any interested party, the registrar will issue an extract from the register. The competent maritime authority of the ship’s port of registry shall automatically receive a copy of registrations and deletions of mortgages.
of mortgages. Finally, an up-to-date extract from the ship’s mortgage register must be kept on board.
The following must be mentioned in the mortgage register:
a) The name and address of the mortgage holder (or the fact that the security has been bearer),
b) Date and rank of registration,
c) Maximum amount guaranteed.
Mortgages granted by the purchaser prior to the granting of nationality to a vessel purchased or built abroad are valid and effective provided they are published in the C.E.M.A.C. member state where the vessel is registered.
Conventional security interests in a building created prior to the granting of the nationality deed vessel, are valid and effective provided they have been:
1) Published, in accordance with the law of the ship’s flag or, failing that, at the ship’s place of construction ship was built;
2) Brought to the attention of the purchaser before the act of transfer of the vessel.
Any voluntary operation that results in the loss of nationality of a mortgaged building is prohibited.
If this operation is, moreover, committed with the intention of violating this prohibition, the perpetrator is liable to the penalties laid down in the Criminal Code.
The voluntary sale of a mortgaged vessel to a third party either in a C.E.M.A.C. member state of the C.E.M.A.C., or abroad, is prohibited. Any act carried out in fraud of these is null and void and renders the seller liable to the penalties provided for in the penal code.
Mortgages granted abroad on a vessel flying the flag of a Member State have effect with regard to third parties only from the date of their entry in the registers kept by the competent maritime authority.
Nevertheless, mortgages constituted on the vessel purchased outside the C.E.M.A.C. territory before its registration in a Member State are valid, if they have been duly recorded by the Consul on the provisional titles of nationality and transferred to the registers kept by the competent maritime authority at the time of the establishment of the titles of nationality and the registration of the vessel.
This deferral can only be made at the request of the creditor.
Mortgage registrations are cancelled either with the consent of parties with or by virtue of a final and binding court decision.
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