And third, a ship is always at risk of partial or total damages at sea.
The registration of a ship mortgage is essential to have legal effects, though failure to register does not render the mortgage void: under Merchant Shipping Acts, any unregistered mortgagee cannot enjoy any benefits available.
Even with the protection clause to the buyer in Norwegian Sales Form 1993, "the Sellers warrant that the Vessel, at the time of delivery, is free from all charters, encumbrances, mortgages and maritime liens or any other debts whatsoever."
For buyers, registration of ships with mortgages is particularly important to avoid future litigation after sales due to claims related to unregistered mortgages.
Registration confers a mortgagee higher priority over the following scenarios but not limited to: However, a mortgagee does not have priority over the following scenarios but not limited to: According to Article 20, Chapter IV of Regulations of the People's Republic of China Governing the Registration of Ships, both the mortgagor and the mortgagee are required to submit three major documents first: As a basic statutory form of mortgage, a reference to a collateral deed containing detailed particulars should be included: