Flagging Standards: Globalization and Environmental, Safety, and Labor Regulations at Sea
Shipping is among the most globalized of industries. Shipowners can choose where toregister their vessels, based on cost, convenience, and the international and domestic regulationsthat would govern their operation. This system of open registration, also known as flags ofconvenience (FOC), can encourage a competition in regulatory laxity among states that want toattract shipping revenues--a race to the regulatory bottom. In Flagging Standards, ElizabethDeSombre examines the effect of globalization on environmental, safety, and labor standards in theshipping industry. She finds that the economic advantages of lowered standards can be offset by thecollective action of international organizations, states, and nongovernmental actors to excludelow-standard ships from the advantages of globalization. Open registries are pressured to raisetheir standards while traditional maritime states lower theirs somewhat when they createinternational or second registries. The result is a competition not for the regulatory bottom butfor the middle ground.DeSombre examines the decisions made by states and shipowners that lead tothis race to the middle and explores the effectiveness of strategies used by both state and nonstateactors aimed at raising regulatory standards, including port control, labor actions against FOCships that fail to meet international labor standards, and trade restrictions against shipped goodsthat were not obtained within the requirements of international agreements. Globalization, DeSombrefinds, may lead to a downward trend in regulatory standards but has also created many opportunitiesto raise these standards and does not necessarily signal a reduction of state control.