New Regulations for Issuing Licenses to Operate Auxiliary Maritime Services

By: Ileana Céspedes

By Resolution JD No. 011-2019 of the 27^th of March, 2019, issued by the Board of Directors of the Maritime Authority of Panama and published in the Official Gazette No.28763-A of the 29^th of April, 2019, new Regulations were enacted for issuing the License of Operation, which is an indispensable requirement for providing auxiliary maritime services in sea port facilities and other areas within the competence of the Maritime Authority of Panama (AMP). 

The Maritime Authority of Panama’s Directorate General of Ports and Auxiliary Maritime Industries has been granted the sole power to issue Licenses of Operation to any individual or legal entity to provide auxiliary maritime services within port areas within the territory of the Republic of Panama or any of the areas under the authority of the AMP.

The License of Operation is defined as a permit issued by the Maritime Authority of Panama to an individual or a legal entity to engage in providing services that are supplementary to maritime transportation and related to cargo, the vessels, crew, passengers,  ports and other maritime facilities.

The License of Operation may cover one specific auxiliary service or several auxiliary services as a cluster. Those services are:

1. Supply.
2. Shipping agency.
3. Inspection of vessels and port facilities.
4. Building, repairs and maintenance of vessels and port facilities
5. Handling waste and fumigation.
6. Transportation.
7. Power generation service in barges.
8. Guarding mobile units drilling out at sea.
9. Port security and hygiene.
10. Other activities determined by the Maritime Authority of Panama.

In order to grant a license of operation, upon verifying that all of the requirements for every type of auxiliary maritime service have been complied with, the Directorate General of Ports and Auxiliary Maritime Industries is bound to review the following matters:  that that the operations which the license is being applied for do not infringe any laws, legal provisions or international agreements or the Nation’s contractual obligations; that the operations are auxiliary maritime activities; and that port safety and hygiene rules as well as the rules approved by the Department of  Prevention and Control of Contamination have been complied with.

The Licenses of Operation are granted for a period of ten (10) years, but may be revoked any time if the service provider does not comply with applicable regulations.  Similarly, the Directorate General of Ports and Auxiliary Maritime Industries may limit the number of licenses of operation for a given service if too many licenses have been granted for one type of service or for public interest reasons or because a previous study by the Department of Auxiliary Maritime Industries exists or because a union so requests or because a new application has new components concerning how the service is provided.

Once the License of Operation for providing auxiliary maritime services has been granted, the provider must guarantee compliance with each of the obligations arising from the resolution granting the license and submit a Compliance Bond to the Maritime Authority of Panama/Comptroller General of the Republic.  This bond may consist of a bank’s security or a compliance bond issued by an insurance company or a bond provider company duly authorized by the Superintendence of Insurance and Re-insurance and by the Comptroller General of the Republic or cash delivered to the Maritime Authority of Panama.

Similarly, the providers are bound to maintain the respective civil liability and contamination insurance policies (if applicable).

On the other hand, during the process of evaluation of the application, the applicant may require a provisional operation permit which shall be granted for a period of ninety (90) days, and will cost one thousand five hundred dollars (US$1,500.00) except for barges in the case of lighterage within area A (all maritime port facilities and anchorage areas located in Panama and in Colón), transport and supply of fuel, waste receiving facilities inside or outside of the port facilities and pilotage area, in which cases the rate established for the license of operation shall apply.

The Regulations for issuing Licenses of Operation must be strictly abided by all of the providers, therefore, in the event of default, the Directorate General of Ports and Auxiliary Maritime Industries has the power to apply monetary sanctions according to the infringement involved, with fines between two hundred and fifty dollars (US$250.00) and twenty-five thousand dollars (US$25,000.00). 

In the event that an individual or a legal entity provides any maritime auxiliary service within port areas in the Republic of Panama or areas under the competence of the Maritime Authority of Panama without the proper License of Operation may have to pay a fine in the amount equivalent to fifteen (15) times the amount established for the service that was provided.

For any additional information or any assistance in the procedures to be conducted before the Directorate General of Ports and Auxiliary Maritime Industries (DGPIMA) of the Maritime Authority of Panama (AMP), you may please contact us at our electronic mail address: quijano@quijano.com