Government Approves Proposal to Gradually Open Cabotage Market to Foreign Ships

Government Decided to Approve Text Opening Cabotage Market to Ships from Other Countries

Among other points, the PL 4199/2020 released by the government progressively allows the use of foreign ships in cabotage navigation without the obligation to contract the construction of vessels in Brazilian shipyards. With the publication of the new government legislation, companies will be able to charter a bareboat, that is, rent an empty ship for use in cabotage navigation.

Read Also

• Oil Resumption Attracts Foreign Companies
• China Opens Oil and Gas Market for Foreign Companies to Invest in the Country
• For URGENT Shipment in Oil Platform, Cabotage Mariners are Requested on This Day April 2
• Logistics Company Hires Professionals for Cabotage Operations in Rio de Janeiro
• Oil and Gas Contracts in Macaé by Engeman Demand Offshore Positions for Cabotage Master

Foreign Ships Will Be Released One per Year by the Government

Under the terms of the cabotage matter, after one year of the law’s enactment, there may be two ships; in the second year, three ships; and in the third year of validity, four vessels.

From then on, the quantity will have no restrictions according to the government. However, safety conditions defined in regulations must be observed.

Another important point of the project highlighted by the government concerns the reduction of the Additional Freight Charge for Renewal of the Merchant Fleet (AFRMM) from 25% to 8%. This measure, in turn, leads to a decrease in the cost of import freight, especially for the inputs imported by the Brazilian productive sector.

Cabotage Can Boost the Brazilian Economy from 2021

This diversification of cargo transport is one of the points that makes cabotage a key to developing infrastructure in our country. This thinking is not at all out of touch with reality, when we remember that heavy investment in trucks and highways underpinned Brazil’s expansion inland in the last century.

It is time to use the same commercial power to provide even more structure and efficiency to the use of our coast. A major reason for this is to note that, even with continental dimensions, 70% of the country’s population lives within 200 kilometers of the coast.