new panamax - legislation update2
TRANSCRIPT
NEW PANAMAXa Global Shipping Transformation
LEGISLATION UPDATE
Enrique Sibauste, London Office
29 September 2015
PANAMA LOCATION, LOCATION, LOCATION
1519 Colonial Route – “Royal Road” – Camino Real o Camino de Cruces Gold from Peru was carried by muleback to Spanish galleons waiting on the Atlantic coast
1855 Panama Railroad Company – “California Gold Fever”The isthmus became the fastest and most comfortable means of travelling to California
1869 First Transcontinental Railroad (USA)The railway continued to carry a great deal of commercial freight destined for Europe or Asia until the Panama Canal was completed in 1914
1914 Panama Canal is completed shortcut for ships - trim nearly 8,000 miles from its voyageA vessel sailing between New York and California was able to bypass the long journey around the tip of South America (Cape Horn) and trim nearly 8,000 miles from its voyage.
2016 Panama Canal EXPANSION is completed (expected April 2016!)
The Expansion Project“The new locks contain as much steel as 22 Eiffel towers; the concrete used would build 2.5 pyramids of Giza and engineers have to shift 50m cubic metres of rock.” – Financial Times What’s new?
• New Locks (Third Set of Locks)• Pacific Access Channel• Improvement of Navigational Channels (Dredging)• Improvements to Water Supply
How much is the Expansion Programme?USD$5.25 billion
Multilateral and Development Agencies Japan Bank for International Cooperation USD$800 millionEuropean Investment Bank (EIB) USD$500 millionInter-American Development Bank (IDB) USD$400 millionInternational Finance Corporation (IFC) USD$300 millionCorporacion Andina de Comercio (CAF) USD$300 million
When did construction work begin?
25 August 2009
To whom was the contract was awarded to?
Grupo Unidos por el Canal
Consortium Members: Sacyr Vallehermoso, S.A. (Spain); Impregilo S.p.A.(Italy); Jan de Nul n.v. (Belgium); Constructora Urbana, S.A. (Panama);
Designers: Montgomery Watson Harsa(MWH) (USA); IV-Groep (Holland); Tetra Tech (USA);
Gate Manufacturers: Cimolai (Italy)
How many job opportunities?
30,000 +
What is the capacity of the expanded Panama Canal?
Existing locks allow passage of vessels that can carry up to 5,000 TEUs
The new Panamax vessels will be able to transit with up to 13,000 TEUs
Panama Canal Trade Routes
In 2012, the Panama Canal handled 218.1 million tons of cargo.
The most significant trade route serviced by the Panama Canal involve connecting the US East Coast to Asia (84.3 million tons; 39%), followed by the West Coast South America / US East Coast route (27.6 million tons; 13%).
The trade routes are therefore mostly involving partners outside Latin America, particularly the Asia / East Coast route which is the trade route that mostly justified the Panama Canal expansion project.
Ripple -EffectPorts
Port of Liverpool
“Subsequent to the opening of Liverpool2 in the final quarter of 2015, the Port of Liverpool will be able to accommodate 95% of container vessels, including neo-Panamax, opening up the possibility of many new shipping routes direct to Superport Liverpool from the Americas.” – Superport Liverpool
COPA AirlinesNetwork
Legislation Update
• Law No. 55 of 2008 regulates Maritime Commerce
• Law No. 56 of 2008 – General Law of Panamanian Ports
• Law No. 57 of 2008 regulates the General Merchant Marine
• Law No. 26 of 2015 which ratifies Nairobi International Convention on the Removal of Wrecks
• The US-Panama Trade Promotion Agreement was approved by Congress and signed into law in October 2011, and entered into force in October 2012.
• Panama also achieved removal from the Organization of Economic Development’s (OECD) gray-list of tax havens by signing various double taxation treaties with other nations; however, the country is still classified in Phase 2 of peer review
• Panama remains an active player in the incorporation of companies, foundationsand trusts for local and international clients.
Investment Grade 2010 2015
Fitch Ratings BBB Positive BBB StableStandard Poors BBB Positive BBB StableMoody’s Baa Stable Baa2 Stable
DOUBLE TAX TREATIESEffective
1. Mexico Law No.24 of 2010 01/01/20112. Barbados Law No.5 of 2011 01/01/20123. Portugal Law No. 7 of 2011 01/01/20134. Qatar Law No. 20 of 2011 01/01/20125. Luxembourg Law No. 21 of 2011 01/01/20126. Spain Law No. 22 of 2011 25/07/20117. The Netherlands Law No. 23 of 2011 01/01/20138. Singapore Law No. 24 of 2011 01/01/20129. Korea Law No.25 of 2011 01/01/201310. Italy Law No.50 of 2011 not yet effective11. France Law No.78 of 2011 01/01/201312. Ireland Law No.59 of 2012 01/01/201313. Czech Republic Law No.5 of 2013 01/01/201414. United Arab Emirates Law No.13 of2013 01/01/201415. Israel Law No.14 of 2013 01/01/201516. United Kingdom Law No.83 of 2013 01/01/201417. Austria Negotiated18. Bahrein Negotiated19. Belgium Negotiated20. Vietnam Negotiated
As of 12 September 2014
TAX INFORMATION EXCHANGE AGREEMENTS (“TIEAs”) Effective
1. United States of America Law No.40 of 2011 18/04/20112. Faroe Islands Law No.65 of 2013 15/03/20143. Finland Law No.66 of 2013 20/12/20134. Iceland Law No.67 of 2013 30/11/20135. Greenland Law No.68 of 2013 09/03/20146. Denmark Law No.71 of 2013 ---------------7. Norway Law No.72 of 2013 20/12/20138. Sweden Law No.73 of 2013 28/12/20139. Canada Law No.84 of 2013 06/12/201310. Germany Negotiated