Algeria : problems with vessel arrests

West of England’s correspondent lawyer, Omar Khelifa, has recently drawn attention to a worrying trend in vessel arrests cases. In several cases the private Algerian Receivers have refused to accept a bank guarantee in order to lift the arrest as provided in Article 156 of the Maritime Code . Instead they have claimed a cash payment in full, usually in a foreign currency. Indeed, Omar Khelifa advises that in some cases these receivers have threatened to issue an arrest order simply to obtain a cash payment.

Although this practice is illegal the only way to avoid it is for the shipowners to institute proceedings in order to obtain a judgement lifting the arrest. This may take several weeks, instead of obtaining the lift arrest through an ex parte demand, which takes two or three days. Normally, the President of the Court has to grant a lift of a vessel arrest through an ex parte demand issued by the arrestor once the bank guarantee has been duly provided by the Algerian Bank counter guaranteed by the Ship Owners’ Foreign Bank.

Due to the repetition of such incidents in many Algerian ports, West of England’s correspondent lawyers have written to the Director of the Merchant Marine of the Ministry of Transport in order to report this new trend, asking that he inform the Ministry of Justice and the Ministry of Finances so that they are able to take the appropriate measures to put an end to this practice.

In addition to being in violation of the Algerian Maritime Code and the 1952 International Convention on Ship arrest, Omar Khelifa draws attention to the fact delays to vessels result in port/berth congestion. This practice also affects the Algerian economy as such practices infringe exchange control regulations as the foreign currencies amounts claimed do not go through the appropriate bank channels.