Shipowners pay Indonesia to free detained vessels: report

More than a dozen shipowners were reported to have made payments of about $300,000 each in order to expedite the release of vessels that had  been detained by the Indonesian navy on the alleged grounds that the vessels had been anchored illegally in Indonesian waters near Singapore, reports Reuters, citing unnamed sources with direct knowledge of the matter.

A dozen sources, which included shipowners, crew and maritime security sources all involved in the detentions and payments, said that the payments were either made in cash to naval officers or via bank transfer to intermediaries who told them they represented the Indonesian navy.

Reuters said that it was unable to confirm independently that payments were made to naval officers or establish who the final recipients of the payments were.

The detentions and payments were first reported by Lloyd’s List Intelligence.

Rear Admiral Arsyad Abdullah, the Indonesian naval fleet commander for the region, said in a written response that no payments were made to the navy and also that it did not employ any intermediaries in legal cases. “It is not true that the Indonesian navy received or asked for payment to release the ships,” Abdullah said.

There have been an increasing number of detentions of ships during the past three months for anchoring without permission in Indonesian waters, deviating from the sailing route or stopping mid-course for an unreasonable amount of time. Abdullah insisted that all the detentions were in accordance with Indonesian law.

Ships have for years anchored in waters to the east of the Singapore Strait while they wait to dock in the port of Singapore. The number waiting has increased in the past 18 months as a result of Covid-19 slowing vessel throughput and an increase in the volume of traffic. The waiting ships had believed that they were in international waters and therefore not responsible for any port fees – an impression that for years Indonesian authorities did nothing to dispel.

Recently, however, the Indonesian navy has said that this area came within its territorial waters. It announced that it intended to crack down harder on vessels anchoring there without a licence.

An estimated 30 ships have been detained by the Indonesian navy over the past three months. Whether or not the Indonesian Navy has received any payment by cash or wire transfer, directly or via intermediaries, the majority of the vessels have since been released after making payments of $250,000 to $300,000, according to two shipowners and two maritime security sources involved.

Two shipowners told Reuters that making these payments, provided that they achieve the release of the vessels, was cheaper than potentially losing out on revenue from ships carrying cargo, if the vessels are tied up for months while a case is heard in Indonesian court.

Two crew members of detained ships said armed navy sailors approached their vessels on warships, boarded them and escorted the ships to naval bases on Batam or Bintan, Indonesian islands south of Singapore, across the Strait. The ship captains and often crew members were detained in cramped, sweltering rooms, sometimes for weeks, until shipowners organized cash to be delivered or a bank transfer was made to an intermediary of the navy, two detained crew members said.

Rear Admiral Arsyad Abdullah, the Indonesian naval officer, said that ship crew members were not detained. He said that “during the legal process, all crew of the ships were on board their ships, except for questioning at the naval base. After the questioning, they were sent back to the ships”.

Maritime lawyer Stephen Askins told Reuters that the navy was entitled to protect its waters, but that if a ship was detained, then some form of prosecution should follow.

“In a situation where the Indonesian navy seems to be detaining vessels with an intention to extort money it is difficult to see how such a detention could be lawful,” Askins said.

Marine Lieutenant Colonel La Ode Muhamad Holib, an Indonesian navy spokesperson, told Reuters that “some” vessels detained over the past three months had been released without charge due to insufficient evidence. He said that five ship captains were being prosecuted and two others had been given short prison sentences and fined 100 million rupiah ($7,000) and 25 million rupiah, respectively.