Two new cruise lines unexpectedly impacted by Russian sanctions


Swan Hellenic’s new expedition cruise ship, SH Minerva, was leased to Russian GTLK (Swan Hellenic)

Posted on April 19, 2022 at 4:36 p.m. by

The Maritime Executive







Two new cruise operations have found themselves the unwitting targets of international sanctions imposed on Russia and its financial institutions after the invasion of Ukraine. While many of the world’s cruise lines that were due to operate in Europe this summer have been working to revamp itineraries to replace ports, particularly in the eastern Baltic, Swan Hellenic and Havila Voyages have the added challenge of having funded their new ships via the Russian GTLK. , a well-established maritime industry financier.


Many people were surprised that GTLK, the State Transport Leasing Company, and its subsidiaries in Europe and Asia, were not included in the first rounds of sanctions led by the United States and the European Union. Many Russian banks and their leasing agencies were included in the first rounds of sanctions, but GTLK, which is under the direct control of the Russian Ministry of Transport and has a large portfolio of transport, aviation and of maritime leasing, was only targeted in April. 8.


The two cruise operators had, however, anticipated that GTLK to whom they lease their ships would likely be part of the sanctions. Finnvera and Finnish Export Credit provided export credit and buyer credit guarantee to a division of GTLK in December 2021 worth over $200 million for two cruise ships currently under construction. construction at Helsinki Shipyard for Swan Hellenic. The 12-year agreements covered the SH Minerva which was delivered to Swan Hellenic at the end of 2021 and a sister ship SH Vega which was recently launched at the shipyard.


“The lease agreements between Swan Hellenic and the subsidiaries of JSC GTLK each provided for an option to purchase. We exercised these irrevocable purchase options at a relatively early stage, well before the recent EU decision,” explains a Swan Hellenic spokesperson. March 13 for SH Minerva and March 31, for SH Vega, the company notified GTLK, in its capacity as lessee, that it was exercising its options to purchase the vessels. “The legal proceedings for the transfer of ownership of the vessels to Swan Hellenic are therefore now at an advanced stage and should be completed imminently,” the company says while noting that Swan Hellenic and its subsidiaries, banks or subcontractors have not not mentioned in the file. punishments.


Swan Hellenic reports that operations of its first cruise ship are continuing with the second ship due to begin its maiden voyage in late May. A third, larger, newly named cruise ship SH Diana is under construction and should be delivered in early 2023.


Norwegian company Havila Voyages, however, said today: “Havila Capella was temporarily decommissioned on Thursday April 14 after company funding conditions resulted in the ship’s insurance being affected by sanctions against Russia. Havila launched its coastal voyages in late 2021 with the first of four cruise ships, with plans to lease all ships to GTLK affiliates. A Hong Kong-based leasing company, which is a subsidiary of GTLK, has taken delivery of the vessel from Tersan shipyard and is leasing it to Havila, which notes that the vessel is registered and operates under Norwegian regulations. However, uncertainties surrounding penalties caused problems with their liability insurance and forced the ship to cancel its scheduled departure from Bergen.


“Havila Kystruten is working through all conceivable channels to find a short-term solution to obtain Havila Capella return to service as soon as possible,” the company wrote in a stock filing on April 19. “According to the company’s assessment, a short-term solution requires the involvement of the Norwegian authorities with regard to the sanctions against Russia.


They anticipated potential problems with the financing of the vessels and announced in March that they had started working to refinance the vessel which was delivered and the three still under construction in Turkey and currently owned by Tersan. However, they did not anticipate the insurance problem and found themselves caught in a loophole that prevents the ship from sailing. Stating that the ship is Norwegian except for the rent payments sent to the GTLK subsidiary, Havila offers a temporary solution to resume navigation. The company is also days away from the scheduled delivery of its second vessel which is due to enter service next month. The third and fourth ships are expected to be completed later this year.





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