We started checking Russian shadow vessel insurance. Now what?

Elisabeth Braw is a senior fellow at the Atlantic Council, the author of the award-winning “Goodbye Globalization” and a regular columnist for POLITICO.

Last December, just days before the shadow vessel Eagle S reportedly damaged an energy cable in the Gulf of Finland, a group of Baltic Sea countries and the U.K. collectively announced they would start inspecting the insurance documents of suspected vessels.

The countries thought they’d finally found the solution that would allow them to crack down on shadow vessels without violating any rules, as shadow vessels are thought to lack proper accident insurance, and the documentation they show inspectors can be worthless or downright fraudulent.

“The United Kingdom, Denmark, Sweden, Poland, Finland and Estonia are tasking respective maritime authorities to request relevant proof of insurance from suspected shadow vessels as they pass through the English Channel, the Danish Straits of the Great Belt, the Sound between Denmark and Sweden, and the Gulf of Finland. Information collected by the participating states, including relating to those vessels that choose not to respond to requests, will be assessed and acted upon together with our international partners,” they declared.

But insurance inspections alone won’t solve the problem.

The idea itself was sensible, as Western insurers — known as P&I clubs — massively dominate maritime accident insurance and aren’t allowed to insure sanctioned vessels. So, if a shadow vessel was asked for insurance documentation, which is mandatory for all commercial vessels, it likely wouldn’t be able to show any, providing officials with a perfectly legitimate reason to ask it to leave — or so the reasoning went.

Nine days later, however, the Finnish Coast Guard observed the Eagle S performing mysterious movements on top of the EstLink 2, the undersea interconnector linking Finland and Estonia. A suspected shadow tanker flagged in the Cook Islands — a shadow vessel favorite — the Eagle S has also been greylisted and blacklisted by the international organizations that document ship safety. Thus, the Finns dramatically boarded and seized the vessel, detaining its crew.

Alas, catching shadow vessels in the act of cutting cables like this is, and will, remain the exception. Far from sabotaging cables, most shadow vessels simply sail through other countries’ waters in all their unseaworthy glory, posing risks wherever they go — another reason why it makes so much sense for affected nations to inspect insurance documentation.

But even though Finland and Denmark have been inspecting insurance certificates ever since, the darndest thing has happened: Virtually every time a shadow vessel has been stopped for inspection, it seems the officer in charge has been able to produce the requested documents. Of course, the documents in question may not actually be proof of functioning insurance — in fact, they might be little more than a piece of paper.

Sundry commentators and social-media users have reacted to the shadow fleet’s blatant and extremely regular journeys through the Baltic Sea by suggesting the coastal states ought seize these vessels, or even sink them, and detain their crews, but it’s not as simple as that either. Stopping shadow vessels is actually far more complicated due to global maritime rules — rules that are violated by shadow vessel owners but should nonetheless be observed by Western countries.

So, as the public grows increasingly frustrated that hundreds of rules-busting, dangerous ships keep sailing the Baltic Sea — and in some cases the English Channel — posing enormous risks to other vessels and the maritime environment, our governments should focus more on finding the shady operators behind the shadow fleet. And while we’re at it, everyone with investigative skills can help identify them too.

The maritime world is based on professionalism. Coast guard officers merely ensure ships carry insurance certificates — they’re not in a position to investigate the veracity of the information, let alone whether the purported company exists.

Last month, for example, one such insurance outfit — Ro Marine — attracted the attention of Norway’s financial inspectorate. Based in Norway and led by a Russian businessman based in St. Petersburg, the company says it insures 250 ships, but according to a report from Norway’s national broadcaster NRK and the Danish investigative journalist group Danwatch, 70 of them belong to the shadow fleet and 40 of them are sanctioned.

Ro Marine also claims to be certified in Norway, but the report states that the documentation allegedly proving this is fake. The company even purports to be located at the Norwegian Shipowners’ Association’s office in Oslo, which is a lie. And in early March, when a Ro Marine-insured ship left Russia, sailing through the Gulf of Finland, the Baltic and passing the Danish Straits, its crew was able to show an insurance certificate and sail on.

And rogue insurance is a serious risk on the high seas. “it’s not simply that these vessels lack adequate insurance that protects their own assets,” said Simon Lockwood, head of the shipowner practice at global insurance broker WTW. “The costs fall back to the innocent parties, and they suffer the financial burden of the actions of rogue operators.” If a Ro Marine-insured ship had hit another vessel, for instance, the other vessel would have struggled to receive compensation.

Shipping used to be chaotic and Darwinian. But over the past century, governments built an impressive edifice of rules, treaties and conventions to make the high seas safer for all involved. The shipping sector added its own rules too, and insurance is part of this construct. Though, again, it mostly depends on voluntary compliance.

The Baltic Sea nations and Britain can call on the owners and crews of shadow vessels to obey the rules; they can call on Russia to obey the rules; they can inspect insurance certificates all they want. If someone has their mind set on subverting the maritime order, no agency can stop them. There are no global maritime police, let alone global maritime court.

But we’re not at the complete mercy of these rule-breakers. Everyone with investigative skills can help restore some manner of maritime order by researching the shadow fleet’s activities. The companies and individuals who sell ships into the fleet, the companies and individuals who buy them, the operators who set up bogus insurance outfits — none of them want their activities to be known.

Let’s expose them.