Norway-based cruise lines Swan Hellenic and Havila Kystruten, whose financing deals with a sanctioned Russian company inadvertently led to their ships being subject to EU sanctions, have said that they were close to finding a way to get round the problems that the sanctions against Russia created for them.
Both companies had financed their new ships with the Russian-owned GTLK, which in April was included on the growing list of sanctioned companies by European and American administrations. As part of what would have been a conventional structure in normal times, both companies, while de facto owners and operators of the vessels, technically leased their vessels from formal owner GTLK, rather than holding the deeds themselves.
Helsinki Shipyard announced on Monday June 27th that Swan Hellenic had been the winner of a tender auction staged by the shipyard to determine the ownership of a recently completed second expedition cruise ship (Newbuild 517) that had been built to Swan Hellenic’s specifications. The keel of the 370-foot cruise ship was laid down in December 2020 in Helsinki and the ship had been ready for delivery, when sanctions intervened.
GTLK, which had been due to take delivery of the cruise ship, was unable to complete the move, because of the sanctions. Helsinki Shipyard then announced under the terms of the contract, that they were going to place the cruise ship up for sale. The deadline was June 24th.
This had left Swan Hellenic in the unexpected position of having to bid for a ship for which a maiden voyage was scheduled only a month in the future.
The shipyard said that it had reviewed the bids and that Swan Hellenic was the winner. The cruise line said as soon as registration is completed with the Bahamas it will take delivery of the SH Vega (IMO 9895252) and that the maiden voyage would proceed as planned on July 20th from Tromsø, Norway.
Swan Hellenic, faced with an impossible situation as long as GTLK remained a business partner, announced soon after Russia’s invasion of Ukraine that it was exercising the purchase rights under its charter for its ships from GTLK.
The company’s first cruise ship, SH Minerva (IMO 9895240), was laid up in South America instead of repositioning for planned summer cruises in the Arctic. The cruise line said
that this was because of a softening of demand due to the geopolitical situation, as well as travel restrictions due to Covid-19. However, it accepted that its need to complete its purchase of the ship had also been a factor.
For Havila Kystruten the overall situation was not that different. In April the first of the company’s four cruise ships, the Havila Capella (IMO 9865570), had to be laid up after the sanctions were announced and its Group Club insurer cancelled the vessel’s general liability coverage. The cruise line went to court in Norway and the UK, seeking to win control of their first ship, while at the same time exploring financing options so that GTLK could be taken out of the picture. Part of the problem for Havila was that it could not even pay money to GTLK to take ownership, as this too would breach sanctions. Havila had proposed
putting the proceeds into a blocked account, which GTLK would only be allowed to access when the sanctions ended. However, GTLK reportedly rejected that option, and was continuing to seek immediate payment for the ships.
After being laid up for 11 weeks, Havila Capella was scheduled to resume its Norwegian coastal voyages on June 28th. The company won a court order in Norway that will see an “arrest” of the ship, with “forced use” for up to two years. It was reported that the company had been able to resolve its insurance issues and that it had received the necessary certificates from the Norwegian Maritime Directorate to resume operations of
the Havila Capella.
Both Swan Hellenic and Havila also have additional cruise ships under construction that would have been covered under the original financing arrangement. Havila reported that the UK court ordered that the shipyard could not take any actions on Havila’s two additional cruise ships (due for delivery in late 2022) without the line’s approval. Helsinki Shipyard is
building a third, larger, cruise ship for Swan Hellenic. That is due for delivery at the end of 2022.
2022-built, Malta-flagged, 10,700 gt SH Vega remains listed as owned and managed by GTLK Europe DAC of Dublin, Ireland. As of June 28th it was moored at Helsinki Port, Finland.
2021-built, Malta-flagged, 10,617 gt SH Minerva is listed as owned by STLC Europe Nine Leasing Ltd care of manager GTLK Europe DAC of Dublin, Ireland. It is listed on Equasis as entered with Standard Club, but does not appear on Standard Club’s listing; nor does it appear as entered with any Group Club on the International Group ship search. As of June 28th it remained moored at Fray Bentos, Uruguay, where it arrived on May 6th.
2021-built Norway-flagged, 15,519 gt Havila Capella is listed as owned by GTLK Asia M11 Ltd care of Havila Kystruten Operations AS of Fosnavaag, Norway. It is entered with Skuld (Skuld Oslo 2) on behalf of Havila Kystruten Operations AS. As of June 28th it was moored at Bergen, Norway, scheduled to leave at any time for Kirkenes, Norway, ETA July 4th.
