18 S C A N D I N A V I A N O I L - G A S M A G A Z I N E N O . 9 / 1 0 2 0 1 0

Due to the tight schedule, timingis precise and any setback mayjeopardise your client’s E&P opera-tion. However, due to the lack ofthorough planning, your vessel isprohibited from entering Brazilianwaters because you forgot to get animportant license.

In view of this neglected license,you must now rush to acquire it.Your client’s managers will proba-bly be blowing up. Needless to say,that this hindrance will not passunnoticed, and probably will leadto contractual penalties and liqui-dated damages.

Weigh Anchor and Hoistthe Mizzen! – Identifyingthe RegulatoryRequirementsUnder such an unsurprisinglycommon scenario, a shipownermust carefully assess its liabilitiesstemming from Brazilian regula-tions, since any mistakes may leadto a troublesome circumstance.

Disregarding even a single licensemay hold up the performance ofthe works for several months.

If you want to be completelyknowledgeable about one of themajor regulatory idiosyncrasies

required for your vessel to operatein Brazil, then you should read thefollowing lines carefully. Here, wewill furnish you with an easy step-by-step guide to help you identifythe rules to which your vessel issubject.

In short, a shipowner can answertwo simple questions to easilydetermine whether a specific ruleapplies or not: “what is your ves-sel’s type and technical specifica-tions?” and “what operations willyour vessel be handling?” The red

B R A Z I L M A R I T I M E

Your company finally executed the charter agreement that you have been hammering out for the last twomonths. After months of struggling to conclude the negotiations, your vessel is finally ready to depart toBrazil for the commencement of a major work.

BY HELLER REDO BARROSO

Chartering a Vessel to Brazil

The FPSO Capixaba (photo: Petrobras)

The FPSO Petrojarl Cidadede Rio das Ostras

(photo: Petrobras)

Will ANTAQ Requirements Apply?

tape can be substantially reducedcontingent on the answers to thesequestions.

For example, a maritime supportvessel, such as a PSV, requires aprevious examination of theBrazilian market to check whetherthere are Brazilian-flagged vesselswith the same specifications thatare available at the time the serv-ice is required. Adversely, this pro-cedure is not mandatory for aFPSO.

That said, let’s weigh anchor andtalk through this issue.

Knowing the Ropes – TheGovernmental AuthoritiesSo, have we gotten your attentionover the possible risks posed by thecomplex authorisation procedure?In fact, should your vessel fail tomeet only a single specific require-ment, it may be forced to leaveBrazil or even be arrested byBrazilian authorities.

Regardless of such pessimism,most of these kinds of problemscan be prevented by assessing “athand” information: first, the ves-sel’s type and technical specifica-tions; and, second, the vessel’sservices in the contract. Being fullyinformed about these mattershelps to identify the governmentalauthorities responsible for the ves-sel and which licensing require-ments can be disregarded.

Brazil’s main maritime govern-mental body is the Navy’sDirectorate of Ports and Coasts(DPC – “Diretoria de Portos eCostas”). DPC is responsible forenacting the maritime rules thatapply to any vessels operating inBrazil regardless of the vessel’s typeor mode of operation. DPC’s rulesdeal with national security andsafety of navigation in Brazilianwaters as well as internationalmaritime rules (for example,MARPOL, SOLAS, IMO require-ments, etc).

Brazil also has a non-military reg-ulatory agency responsible forsupervising and regulating activi-ties related to waterway transporta-tion: ANTAQ (Agência Nacional deTransportes Aquaviários). ANTAQ’srules deal with regulating the eco-nomic activity of shipping for cer-tain kinds of operations: supportvessels, coastal shipping, and long-haul shipping.

Batten Down the Hatches!– Knowing Which RulesApplyNow that we have familiarised youwith the two main regulators inBrazilian maritime law, let’s moveforward to determine whether aspecific requirement will apply toyour vessel.

Once again we highlight that suchdistinction is a primary aspect inthe assessment of shipowner’s lia-bilities arising from Brazilian reg-ulations. Vessels subject to ANTAQ’sregulation have a much largerbundle of rules to comply with,which includes market restrictions(only Brazilian companies cancharter these vessels) and complexprocedures (such as the marketexamination previously men-tioned).

Although DPC rules apply to allvessels, those that provide onlyexploration survey services (seis-mic vessels), drilling or productionservices (FPSO, jack-up rigs,MODU, etc), or engineering servic-es (pipe-laying, crane vessels, etc),are not generally subject toANTAQ’s regulation. This is why itis so important to know your ves-sels type.

On the other hand, the specificaspects of the operations to be sup-plied will also influence the appli-cability of ANTAQ’s rules.Situations where an engineeringvessel is also providing support,coastal or long-haul shipping,ANTAQ’s regulation will apply.

For example, a crane vessel char-tered to perform lifting servicesand to transport materials fromthe port to the offshore site willprobably be subject to ANTAQrequirements. This is why it is soimportant to be fully knowledge-able regarding the operation’s spe-cific characteristics.

In some cases there may be someuncertainty as to whether the ves-sel falls within the ANTAQ’s rulesor not. Therefore, it is highly rec-ommended to consult with ANTAQto determine whether the vessel falloutside the agency rules.

In our previous experience, ANTAQhas requested only two documentsfor issuing their statement.Coincidently, those documentsinvolve the same information thatwe focused on in this article: first,the vessel’s sketch and technicalspecifications; and, second, theservices or charter contract inwhich the operation to be per-formed by the vessel is explained.

Sailing to Brazil at FullSpeedIt’s worth repeating the two mainissues for determining whichrequirements a shipowner mustcomply with.

The first step is to be familiar withyour vessel. Most of the time, sim-ply by knowing your vessel’s typewill help out identifying mandato-ry requirements (for example, seis-mic vessels require an authorisa-tion for performing data acquisi-tion activity in a particular area).

Always remember to be completelyaware and updated about the serv-ices that your vessel will be provid-ing. Any modifications in the scopeof the work may lead to stricterrequirements. Accordingly, it is bet-ter to take a more conservativeapproach in order to preventunnecessary liabilities.

We hope that this practical guidehelps elucidating the confusingissues regarding ANTAQ’s andDPC’s rules. So, in your next char-ter, your vessel should be able tosuccessfully depart to Brazil andprovide the services on a timelybasis.

Bon Voyage! �

S C A N D I N A V I A N O I L - G A S M A G A Z I N E N O . 9 / 1 0 2 0 1 0 19

B R A Z I L M A R I T I M E

FPSO Sevan Piranema (photo: Petrobras)

The Author:

Heller Redo Barroso is the foundingpartner of Heller Redo Barroso &Associates, a Brazilian Rio-basedboutique law firm specialised in oiland gas, power, shipping, and theoffshore petroleum industry. Thecore business of the firm is assist-ing foreign contractors and ven-dors, especially newcomers intothe Brazilian marketplace, in vari-ous projects with major oil and gasindustry players.