Every day I see cars here in Ireland with foreign registration plates. They are mostly from the United Kingdom, but increasingly they are from the new European Union members of Eastern Europe; Poland, Lithuania, Slovakia.
These cars sail around on a cloud of economic immunity.
- No tax? (do the Gardai know how to check? and if it was paid it was cheaper in Eastern Europe, that is why the majority of cars have large engines <2 litres)
No insurance? (do the Gardai know how to check?) - No VRT (because they do not have Irish registration plates, and even if they did register there is an exemption where the registrant owned the vehicle abroad for a period)
- No penalty points (only licences issued in the Republic of Ireland can have penalty points applied to them)
- No fines (the Gardai, Traffic Wardens cannot find out the postal address for notification)
I say that these cars are flying a “flag of convenience”. This is a term that originated in shipping to describe the situation where a vessel is registered in a foreign country “for purposes of reducing operating costs or avoiding government regulations”.
The term comes from the flag that ships fly to show their country of registration. Under conventions of international law, the country of registration determines the source of law to be applied in admiralty cases, regardless of where the case matter occurs.
The first flag of convenience was that of Panama, and the practice of re-flagging ships grew in popularity during the period from 1920-1933 of Prohibition in the United States, allowing American rum runners carried illegal alcohol under the Panamanian flag.
In the 1970s the United Nations (UN) attempted to adopt regulations that to stop the practice. However, the Organisation for Economic Co-operation and Development (OECD) countries defeated these measures.
To quote William Langewiesche’s The Outlaw Sea:
“No one pretends that a ship comes from the home port painted on its stern, or that it has ever been anywhere near… No coastline is required either. There are ships that hail from La Paz, in landlocked Bolivia. There are ships that hail from the Mongolian desert. Moreover, the registries themselves are rarely based in the countries whose names they carry: Panama is considered to be an old-fashioned “flag” because its consulates handle the paperwork and collect the registration fees, but… “Bahamas” [is run] by a group in the City of London.”
While this is bad, one must admire the inventiveness.
Indeed.
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