15 December 2024 | by Mustofa Morshed

Maritime trade plays a vital role in Bangladesh’s economy, with the country’s ports acting as major commercial gateways. Consequently, legal disputes involving ships—whether arising from cargo claims, crew wages, or damages—often lead to the use of ship arrest as a tool for securing claims. In Bangladesh, the process of ship arrest is governed primarily by the Bangladesh Admiralty Court Act, 2000 (BACA) and the Admiralty Rules, 1912 (BAR), under the jurisdiction of the High Court Division of the Supreme Court of Bangladesh.

This article offers an in-depth exploration of the legal framework, procedures, and practical considerations involved in ship arrests within Bangladeshi jurisdiction.

Jurisdiction of the Admiralty Court

The Admiralty Court is a specialized bench of the High Court empowered to handle maritime disputes. The court exercises in rem jurisdiction, meaning it can initiate proceedings directly against a vessel, as well as limited in personam jurisdiction, against the shipowner.

Importantly, the Admiralty Court in Bangladesh maintains the power to arrest ships based on claims listed in Section 3(1) of BACA. The court also retains jurisdiction over foreign vessels, foreign-owned ships, and ships owned by government bodies, including foreign governments.

Bangladesh and International Conventions

Bangladesh is not a party to the 1952 or 1999 International Conventions on Arrest of Ships. However, its domestic laws are closely aligned with the spirit of these conventions, providing a balanced and predictable legal framework.

Types of Claims Allowing Ship Arrest

Section 3(1) of BACA outlines the admissible claims that can lead to ship arrest. Some key grounds include:

1. Ownership claims (e.g., disputes between co-owners)
2. Mortgage enforcement
3. Damages caused by a ship
4. Loss of life or personal injury
5. Cargo loss or damage
6. Charter party disputes
7. Salvage and general average
8. Towage and pilotage
9. Port dues and dock charges
10. Unpaid crew wages
11. Ship repair and construction disputes
12. Insurance disputes
13. Statutory liens

Procedure for Arresting a Vessel

A ship arrest begins with a petition filed before the Admiralty Court. The petitioner must submit:

• A formal admiralty suit (including the nature of the claim)
• A verified affidavit
• Supporting documents or evidence
• A Power of Attorney (POA), if filing through a legal representative

In practice, the POA must be notarized and later consularized by a Bangladeshi embassy or endorsed by the Ministry of Foreign Affairs, though initial filing can proceed with a simple notarized POA pending full legalization.

If the court finds the petition to be prima facie valid, it may issue an ex parte arrest order, usually within 1–2 working days. The court forwards the arrest order to the relevant port authority for enforcement.

Port authorities (e.g., Chittagong or Mongla Port) physically enforce the arrest by detaining the ship, often by withholding clearance or physical control. Once detained, the vessel is prohibited from sailing unless released by court order.

A ship may also be arrested in execution of a decree passed by any Superior Court of any reciprocating territory (currently England and India) of a foreign country against the owner of the ship.

Several other authorities also possess the power to detain ships pertaining to non-compliance to operational regulations and non-payment of fees. Examples include port authorities for unpaid fees or disturbance within the port area, customs authorities, the Mercantile Marine Department under the Merchant Shipping Ordinance, 1983 (MSO), and so on. 

Sister Ship Arrests and Time Charters

Bangladesh permits the arrest of sister ships under Section 3(1)(d) to (q) of BACA, provided they are beneficially owned by the same entity as the offending ship. However:

An arrest cannot be made against a ship operated under bareboat or time charter unless beneficial ownership is established.

Foreign-flagged ships or vessels owned by foreign companies can still be arrested if they are present within Bangladesh’s jurisdiction.

Releasing the Vessel

The ship can be released upon:

1. Settlement of the claim
2. Providing adequate security, typically in the form of a Bank Guarantee from a Bangladeshi bank. This, in turn, requires a counter guarantee from another bank from the residing country of the defendant in case it is a non-resident. The Bank Guarantee is required to cover the entire claim, including reasonable interest, court fees, and costs at the discretion of the Court. 

Notably, P&I Club Letters of Undertaking (LOUs) are not accepted under the current Bangladeshi admiralty practice.

The court may order the release of the ship within 24 hours of receiving valid security, ensuring minimal commercial disruption.

Legal Protections and Challenges

Defendants may file a caveat petition to preemptively oppose ship arrest. While it alerts the court, it does not prevent arrest if sufficient cause is shown.

Although Bangladesh law does not mandate counter-security from plaintiffs, claimants may be penalized with costs or damages if the arrest is proven wrongful, malicious, or based on false representations.

Sale of Vessel and Retention of Jurisdiction

In certain cases, especially where the ship’s value is deteriorating or where costs are accruing due to port detention, the court may order a judicial sale of the ship even while the suit is pending.

Once a ship is arrested and security is submitted, the court maintains jurisdiction, even if an arbitration clause exists. However, the court may suspend proceedings pending arbitration under appropriate conditions.

Ship arrest in Bangladesh is a mature legal mechanism that balances the rights of claimants with safeguards for shipowners. Despite not adhering to international arrest conventions, the system is robust, detailed, and effectively addresses maritime disputes within its jurisdiction. More Blogs…