1.1 Using the private sector to ensure the maintenance of standards of Danish shipping
The ‘freedom of the seas’ concept could, in a regulatory context, be considered a fallacy. Shipping is nationally, and not least internationally, densely regulated in order to ensure the safety of life at sea and the protection of the environment. It has long been a goal for the Danish authorities that the Danish flag State should be considered as a leader in 'quality shipping', and thus setting benchmarks for health, safety and protecting the environment at sea.(1) See e.g. the Danish Maritime Authority: Sikkerhed, sundhed og miljø i fremtidens kvalitetsskibsfart, Søfartsstyrelsen 2010, http://www.soefartsstyrelsen.dk/SikkerhedTilSoes/Skibssikkerhed/Arbejdsmiljoe/VejledningerArbejdsmiljoe/Documents/Sikkerhed,%20sundhed%20og%20milj%C3%B8%20i%20fremtidens%20kvalitetsskibsfart.pdf. Denmark is widely considered to have achieved this goal, but this has required intensive regulation and policing to ensure compliance with the rules.(2) See e.g. International Chamber of Shipping: Shipping industry flag state performance table 2015/2016 http://www.ics-shipping.org/docs/flag-state-performance-table. The Danish Maritime Authority (hereafter the DMA) is generally the relevant administrative authority in this area, but many of the tasks of the DMA are carried out by companies/entities within the private sector. This contribution will discuss the most central of these, namely the classification societies, and their exercise of administrative duties and authority on behalf of the DMA.
The fact that certain areas of public management are delegated to private enterprises is not, as such, peculiar to the shipping industry. It is common in other legal areas to see private entities, by delegation from an administrative authority, undertaking registration, certification, control and possibly even issuing injunctions or, if necessary, prohibitions. Examples in an everyday context would include an authorised garage inspecting to see if a car is roadworthy or local municipalities employing private chimney sweeps to reduce the risk of chimney fires from occurring.(3) See in general on the topic, Bønsing, Lovbestemt delegation af forvaltningsmyndighed til private, Juristen nr. 6, 2013, side 263 ff.
What is more unusual, however, is that private entities within the shipping industry will have not only a (possibly controlling) influence over how the legal framework of the shipping industry is enforced, but may also have (controlling) influence over the actual content of these rules. In this respect classification societies have essentially two roles:
They will supply the regulations, current industry standards and best practices with which ship owners are expected to comply in order to achieve an appropriate level of classification within that particular society, with the ship owner potentially being subject to civil law consequences if they do not comply.
In addition, and possibly more importantly, these same private companies are largely authorised to issue administrative rules on behalf of Denmark as a flag State.