How are mortgages and negative pledges in ships reported and registered?

Mortgages must be registered in the Register of Shipping when the owner of a ship wants to pledge his ship as security and the mortgagee wants to secure his right.

The following types of mortgage documents and other rights can be registered in the International Ship Register (DIS) and the Danish Ship Register (DAS). A mortgage cannot be registered in the Boat Register (FTJ). Here you will find forms for:

• Form I 6 Mortgage, including possibly index mortgage (link
• Form I 7 Indemnity bond (link
• Form I 4 or 5 Owner’s mortgage, including possibly owner’s mortgage with sub-mortgage (link
• Form I 10 Negative pledge (link

You must use the forms from the Register of Shipping when you create one of the above documents. Mortgage documents and negative pledges created on other forms will be returned for correction.

Letters of deposit on paper must be sent to the Ship Register in original, with consecutively numbered and bound-together pages, signed by the issuer.

On new mortgages and negative pledges, the identity of the signatory, the authenticity of the signature and the date of signature must be confirmed by objective party witnesses or a notary public. Allonges can also be signed according to a power of attorney (link to Power of Attorney - Ship Register). Remember that the power of attorney must be sent in original to the Register of Shipping together with the mortgage or negative pledge.

Please note - it is no longer accepted to report mortgage documents and negative pledges in the same document.

If an independent priority position is not specified for mortgage rights as well as for negative pledges, a note is given about the lack of priority position being specified.

Changes

When you need to register changes to a registered "paper" mortgage document or a "paper" negative pledge, most recently reported to the ship register before 16 January 2023, this is done by drawing up an allonge, which is physically fixed with a staple (so that it does not fall off) on the original document.

Requests for changes to already registered mortgage documents must be signed by the issuer/debtor and/or creditor, depending on the content. In the same way, both pledgors and/or pledgees may have to sign depending on the content of the change. As a rule of thumb to determine who should sign, you can say that the person whose position is degraded should sign.

In regards to changes to mortgages and negative pledges, the identity of the signatory, the authenticity of the signature and the date of signature must be confirmed by objective party witnesses or a notary public.

There is no requirement for a request of authenticity in applications for deletion of mortgages and negative pledges.

Requests can be signed according to a power of attorney. Remember that the power of attorney must be sent in original to the Register of shipping together with the mortgage or negative pledge:

Form I 9 Request for already registered mortgage documents (link)

It is voluntary whether you want to use form 9.

Deletion

If you want to delete a registered mortgage and a possible negative pledge, you can give an endorsement to this effect on the last page of the already registered mortgage or negative pledge (instead of submitting a request), or you can attach a request.

• For owner’s mortgages: Issuer, or bank authorized to sign a declaration of deletion
• For mortgages: Creditor
• For Indemnity bonds: Creditor
• For negative pledges: Pledgor or pledgee – signed by 1) the person who assumes additional obligations, which is the pledgor 2) If obligations are eased or deleted, the pledgee must sign.

When you need to register changes to or deletion of a registered digital/dematerialized mortgage document or change of a negative pledge, reported to the Register of Shipping after 15th January 2023, this is done by drawing up an allonge, which is signed and submitted to the Register of Shipping with the original signature(s).

The Register of Shipping has prepared standard requests that must be used

However, you can choose to delete an indemnity bond and/or a negative pledge on a loose receipt or with a request.

In order to be able to report changes or cancellation of a turnover mortgage deed issued on paper, you must be able to present the original document to the Register of Shipping.

Turnover mortgages are, for example, owner’s mortgages and mortgages, but not indemnity bonds.

If a turnover mortgage disappears, you can file an action for mortification of the mortgage at the district court. It costs a court fee, and the mortification process typically lasts between 3 and 12 months before the court issues a verdict that a mortgage has been mortified.

Mortified means that the physical document is declared "null and void".

The mortgage can then be deleted by the Register of Shipping, or a replacement mortgage can be issued, after which you can once again dispose of the mortgage.

You can read more about mortification at Domstol.dk.

To file a case for mortification, you must, among other things, give the court a copy of the mortgage. You can order it by writing to srg@dma.dk.

A printout costs DKK 150, which must be paid into the Danish Maritime Authority's account:

Danske Bank
reg.no. 0216
Account number: 4069 0316 25
IBAN: DK8402164069031625
SWIFT: DABADKKK

with indication of signal letters/FTJ no. and documenttype "pante-brev".

In order to be able to dispose of a turnover mortgage, you must be able to present the original document.

You must notify the Register of Shipping that you have initiated a mortification. You do this by sending an original certified copy of the court book to the Register of Shipping, or you can ask the court to send a copy via e-Boks to the Register of Shipping. The Register of Shipping then notes down information about the initiation of mortification of the mortgage on the Ship register.

The notes also have the effect that if the mortgage and ship are deleted from the ship register when the mortification judgment has been issued, your obligation to pay annual tax for the ship ceases from the date on which the ship register received notification that mortification proceedings had been initiated.

After sentencing, you can either

• delete the lost mortgage from the register by sending us the mortification judgment with the court's endorsement that the judgment can no longer be appealed. The original judgment must be sent either as physical mail or electronically via the court's e-Box. The judgment must precisely identify the mortgage to which the judgment relates, and that the mortgage is declared null and void in accordance with Section 2, subsection 2 of the Mortification Act.
• report changes to the mortgage for registration in the ship register, if you have requested of the court that a replacement mortgage is to be issued.

The mortification judgment must expressly decide on the reissuance of the lost mortgage. The transcript of the judgment must have a notation that the appeal period has expired. In this case too, you must send an original, certified copy of the court book by physical post or electronically via the court's e-Box to the Register of Shipping.

Please note that when all mortgages on a pleasure craft with a GT of less than 20 are deleted, the ship will be deleted from the ship register, because unencumbered recreational vessels with a GT of less than 20 cannot be registered in the ship register after 1st March 2018.

If you have debts and cannot pay, the creditor has the option, at a bailiff meeting, to seize your assets, including the right to register your ship in a Danish ship register. Seizure gives the creditor the opportunity to demand that the ship be sold at a forced auction. When the seizure is registered, it also has the legal effect that you cannot dispose of the ship, e.g. sell the ship, without the consent of the execution creditor.

In order for the Register of Shipping to register the execution, we must receive an original printout of the bailiff's book or a scan of a printout sent directly from the bailiff's e-Boks to srg@dma.dk. It is important that the printout shows exactly in which ship the attachment was made, who the creditor is, who the debtor is and how much money is attached. Information on the name of the creditor, the name of the owner, the execution amount, the ship's name, home port and signal letters is sufficient.

The Register of Shipping can cancel attachments on the basis of an original signed letter from the execution holder. In the letter, the ship in which the execution was made and the execution amount must be stated. The letter must be originally signed by the mortgagee.

The buyer of a ship subject to foreclosure can, after the foreclosure deed has been issued, request the Register of Shipping in a letter to delete mortgage(s), execution(s) or other liabilities on the basis of the foreclosure of the ship and when it appears from the foreclosure judgment that uncovered rights lapse upon foreclosure. You must attach an original copy of the bailiff's book or the bailiff can send the decision to the Register of Shipping.

As a buyer of a ship at a forced auction, you must register as the owner of the ship unless you are already registered as the owner of a ship or ships. Reports must be made on one of the forms 23, 24 or 25.

Delete execution or mortgage during the bankruptcy of the ship's owner, when the mortgage is registered with a legal effective date before, or executions made later than 3 months before the deadline. You must either attach an original copy of the bailiff's book or the bailiff can send the decision to the Register of Shipping.