Taiwan's Evergreen Fleet Will Adopt Red Ensign

by Mary Swire, Tax-News.com, Hong Kong

09 January 2002

Taiwanese Evergreen Group chairman Chang Yung-fa said in Tokyo that up to 40 ships could be transferred from the Panamanian flag to the British register. Two vessels are already committed to the Red Ensign, and the company has indicated that the shift to the UK register will probably involve all five of a series of newbuildings from Mitsubishi Heavy Industries.

Mr Chang has been attracted to the Red Ensign because of the tax advantages offered by the UK's tonnage tax regime, and the company's ability to use Taiwanese officers with British certificates on board, plus the prestige and security of the British flag. Mr Chang is thought to have developed a close working relationship with Maurice Storey, chief executive of the UK Maritime and Coastguard Agency, administrators of the flag.

The timing and other details may change, but people familiar with the company confirm that this pro-British campaign is in line with the Taiwanese shipping magnate's current thinking. Mr Chang has a reputation for revealing strategic shifts at impromptu interviews and in this case he was speaking to a Japanese reporter in the southern Japanese port city of Fukuoka. He is nonetheless clearly signposting a re-branding as a European player.

However, the British-flagging campaign is still a strategy 'under construction', subject to change. At one time, Mr Chang also suggested that he would put much of the Panamanian-flagged fleet into Lloyd Triestino, which has not happened to date. Evergreen Marine does have a stake in Lloyd Trestino, but the majority shareholding is ultimately held by Mr Chang privately through various vehicles.

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