<P> The reasons for choosing an open register are varied and include tax avoidance, the ability to avoid national labor and environmental regulations, and the ability to hire crews from lower - wage countries . National or closed registries typically require a ship be owned and constructed by national interests, and at least partially crewed by its citizens . Conversely, open registries frequently offer on - line registration with few questions asked . The use of flags of convenience lowers registration and maintenance costs, which in turn reduces overall transportation costs . The accumulated advantages can be significant, for example in 1999, 28 of the American company SeaLand's fleet of 63 ships were foreign - flagged, saving the company up to 3.5 million dollars per ship every year . </P> <P> The environmental disaster caused by the 1978 sinking of the MV Amoco Cadiz, which flew the Liberian flag, spurred the creation of a new type of maritime enforcement . Resulting from strong political and public outcry over the Amoco Cadiz sinking, fourteen European nations signed the 1982 Paris Memorandum of Understanding on Port State Control or Paris MOU . Under port state control, ships in international trade became subject to inspection by the states they visit . In addition to shipboard living and working conditions, these inspections cover items concerning the safety of life at sea and the prevention of pollution by ships . In cases when a port state inspection uncovers problems with a ship, the port state may take actions including detaining the ship . In 2015, member states of the Paris MOU conducted 17,858 inspections with deficiencies, which resulted in 595 detained vessels and 11 banned . Member states of the Tokyo Memorandum of Understanding conducted 17,269 ship inspections in 2015, recording 83,606 deficiencies which resulted in 1,153 detentions . </P> <P> The principle that there be a genuine link between a ship's owners and its flag state dates back to 1958, when Article 5 (1) of the Geneva Convention on the High Seas also required that "the state must effectively exercise its jurisdiction and control in administrative, technical and social matters over ships flying its flag ." The principle was repeated in Article 91 of the 1982 treaty called the United Nations Convention on the Law of the Sea and often referred to as UNCLOS . In 1986, the United Nations Conference on Trade and Development attempted to solidify the genuine link concept in the United Nations Convention for Registration of Ships . The Convention for Registration of Ships would require that a flag state be linked to its ships either by having an economic stake in the ownership of its ships or by providing mariners to crew the ships . To come into force, the 1986 treaty requires 40 signatories whose combined tonnage exceeds 25% of the world total . As of 2017, only 14 countries have signed the treaty . </P> <P> Merchant ships have used false flags as a tactic to evade enemy warships since antiquity, and examples can be found from as early as the Roman era through to the Middle Ages . Following the American Revolutionary War, merchantmen flying the flag of the fledgling United States quickly found it offered little protection against attack by Barbary pirates - many responded by seeking to transfer their registry back to Great Britain . The use of false flags was frequently used by the British during the Napoleonic Wars and the United States during the War of 1812 . During the mid-19th century, slave ships flew various flags to avoid being searched by British anti-slavery fleets . However, the modern practice of registering ships in foreign countries to gain economic advantage originated in the United States in the era of World War I, and the term "flag of convenience" came into use in the 1950s . </P>

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