2014 Spanish Shipping Law Act: New (and better) ship arrest rules in Spain

The new Spanish Shipping Act that will enter into force next 25 of September 2014 has introduced interesting changes into the law of arrest of ships in Spain.

The introductory chapter of the Act states that the new Shipping Act regarding the arrest of ships is aimed to ensure that these are effected without the need for the claimant to prove the credit, the risk, or the urgency of the matter. The mere allegation of a credit or of a right under the 1999 Arrest Convention will suffice.

The main law on ship arrest in Spain remains the 1999 Arrest Convention but new Act introduces a set of rules worth noting that are expected to to improve and clarify ship arrest practice in Spain.

The competent Commercial Courts for the arrest will be the Court where the claim on the merits is to be pursued, or the competent port Court where the ship is to arrive, at the choice of the claimants. If the ship does nor arrive to the port, the port Court will lose its competence for the arrest of the ship. This, sensu contrario, should mean that such port Court should be able to deal with an arrest application before the ship arrives to the port. This is something that in the past posed sometimes reactions by commercial Courts that refused to grant an arrest order before the ship had arrived to the port.

The time limit to request the arrest of a ship will be the date where a judgment or an arbitration award is issued or obtained. From this moment the claimants must arrest the ship via an enforcement application. In the past some Courts  refused to arrest ships, for instance, after arbitration had been commenced. This new clear time limit should prevent such narrow interpretation of the law.

The security to be put by the claimants will need to be of a minimum of 15% of the claimed amount.  This amount of security can be revised ex officio, or ex application, to take into consideration the circumstances of the case. The form of the security can be any permitted in law, including a bank guarantee. P&I Clubs LOU might now have more chances of being accepted by the Court.

Ships flying the Spanish flag can be arrested for any other claim in addition to those set out within Art. 1 of the 1999 Arrest Convention provided the creditor has its usual residence in Spain, its principal place of business in Spain, or has obtained the credit via subrogation, or assignment. Ships not flying a flag of a 1999 Convention signatory State, the great majority, can be arrested in Spain for maritime claims as well as for any other claims.

The Maritime Authorities can withdraw the ship’s documents to ensure compliance with the arrest order. This will be in addition to the usual detention measures.

A copy of the arrest order and of the arrest application is to be served either to the ship agent or to the Master of the ship. The action on the merits must be lodged within the period of time fixed by the Court, that will range from a minimum of 30 days to a maximum of 90 days.

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