Germany’s Successful Tax-Based Ship Finance Soon Faces Judgment

by Bridget Hogan, London

Despite ongoing attacks from foreign opponents, German ship finance is quietly motoring along after dramatic expansion last year. And, although it shows no sign of diminishing, the German government will need to defend its ship/share scheme in the European Court at some stage later this year.

The Germans argue there is a difference between a subsidy and an industrial incentive; and this reasoning was acceptable under an earlier European Union ruling much to the disgust of Danish and Dutch opponents.

In 1994, DM1.63 billion was raised from German share sales, 45% more than in 1993. This money helped finance 93 newbuildings and 16 secondhand ship purchases.

Non-German shipyards and, in some cases, shipping lines are looking anxiously at the success of the scheme which seems to have won official sanction. They fear the German-owned fleet is achieving a high level of domination of the shipping scene, particularly in containership chartering.

This is only an excerpt of Germany’s Successful Tax-Based Ship Finance Soon Faces Judgment

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