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No court decision on Suez Canal’s claim over massive vessel

Last Updated May 23, 2021 at 10:05 am MDT

Ever Given, a Panama-flagged cargo ship, is seen in Egypt's Great Bitter Lake Tuesday, March 30, 2021. Experts have boarded Ever Given container ship that had blocked the Suez Canal for nearly a week before it was dislodged. A canal pilot says engineers are inspecting the Ever Given for damage and trying to determine why it ran aground. (AP Photo/Mohamed Elshahed)

CAIRO (AP) — An Egyptian appeals court on Sunday said it lacks jurisdiction to look into the Suez Canal Authority’s demands to uphold financial claims that led to the the seizure of the massive Ever Given ship after it blocked the waterway in March.

The authority and the ship’s owner are in dispute as to whose fault it was that the ship ran aground in the canal linking the Mediterranean Sea and the Red Sea – and how much compensation should be paid.

The appeals chamber of the Ismailia Economic Court referred the case to a lower court to decide on the legality of the seizure of the Ever Given until the settlement of compensation claim between the the Suez Canal Authority and Shoei Kisen Kaisha Ltd., the ship’s Japanese owner, according to Hazem Barakat, a lawyer representing the vessel’s owner.

There was no immediate comment from the canal’s authority.

The Ever Given was on its way to the Dutch port of Rotterdam on March 23 when it slammed into the bank of a single-lane stretch of the canal about 6 kilometers (3.7 miles) north of the southern entrance, near the city of Suez.

A massive effort by a flotilla of tugboats, helped by the tides, freed the skyscraper-sized ship six days later, ending the crisis and allowing hundreds of waiting vessels to pass through the canal.

Since it was freed, the Panama-flagged vessel, which carries cargo between Asia and Europe, has been ordered by authorities to remain in a holding lake mid-canal as its owner and the canal authority try to settle the compensation dispute.

At first, the Suez Canal Authority demanded $916 million in compensation, which was later lowered to $600 million, the head of the canal authority, Lt. Gen. Osama Rabie, said in comments on a television program earlier this month.

The compensation amount would account for the salvage operation, costs of stalled canal traffic and lost transit fees for the week the Ever Given blocked the canal.

The ship’s technical management company, Bernard Schulte Shipmanagement, said in April the Suez Canal Authority had not provided a detailed justification for the compensation claim, calling it “extraordinarily large.”

Barakat, the lawyer, said the next court hearing on the case will take place on May 29.

On Saturday, lawyers representing the ship’s owners blamed the canal authority for the vessel’s grounding, claiming that the canal authorities did not provide evidence faulting the ship’s crew. They also argued that the canal authority should not have allowed the he vessel to sail in the waterway amid bad weather.

Barakat said the Voyage Data Recorder, also known as a vessel’s black box, had recorded a debate between canal pilots and its control center over whether it should allowed to transit the canal.

Barakat also confirmed that the vessel’s owners, had, for, their part, demanded $100,000 in initial compensation for losses related to its seizure.

A spokesperson for the Suez Canal Authority did not respond to phone calls Sunday seeking comment. The canal has repeatedly denied wrongdoings.

The six-day blockage disrupted global shipment. Some ships were forced to take the long alternate route around the Cape of Good Hope at Africa’s southern tip, requiring additional fuel and other costs. Hundreds of other ships waited in place for the blockage to end.

About 10% of world trade flows through the canal, a pivotal source of foreign currency to Egypt. Some 19,000 vessels passed through the canal last year, according to official figures.

By Samy Magdy, The Associated Press