L.G. Molina
Spanish Association of Small and Medium Shipyards, Avda. Cardinal Herrera Oria, 57, 28034 Madrid, Spain

PYMAR is the Association of the Medium and Small Spanish shipyards involved in the construction and repairing of vessels over 100 GT.

Currently 24 Shipyards are members of PYMAR. All of them are private owned.

One of the main purposes of PYMAR is the improvement of the competitiveness of its shareholders through the coordination and development of shipyards' initiatives on the following domains:

- Technical;

- R + D + I;

- Finance/Tax;

- Production; -Purchasing;

- Other common interest matters.

Since May 2003 when, with PYMAR as sponsor, a Seminar on Financial frameworks for the support of the Russian Fleet renewal, was held in Madrid, various functions have been held, in representation of the member shipyards, in commercial, financial and institutional spheres, all with the aim of identifying the legal, financial and commercial difficulties that exist in Russia for the Spanish shipyards that collaborate in the renewal of the Russian fleet, constructing and financing vessels for Russian owners.

In June 2005, and forming part of the 5th Session of the Spanish-Russian Inter- governmental Committee for Economic and Industrial Affairs, held in Moscow, it was decided by the representatives of both Administrations that a Sub-group of Shipbuilding would be formed within the Working Group of Industrial Corporation. The objective of this Sub-group is to establish the collaboration mechanisms between the two countries with the aim of helping with the renovation of the Russian fleet by the shipyard members of PYMAR. By the Spanish side a representative of PYMAR was elected as Coordinator.

In respect of the Fishing market, all PYMAR shipyards have a long experience in the construction of fishing vessels, not only for the Spanish Ship-owners, which own one the most important fishing fleets in the World, but also for fishing Owners of almost all the countries with fishing fleet, among them Russia. Only during the last 20 years more than 30 fishing vessels have been built for Russian Owners in the Spanish shipyards.

One of the mechanisms developed by PYMAR to support the activity of its members' is the Asset Guarantee Fund (FPG), which is an independent fund with its own structure and means, created with the purpose to promote ship contracting through the issuance of guarantees against its FPG value on the basis of the study of each operation risks assessment. The FPG guarantees may cover:

Shipyards (short term): refund guarantees, performance bonds, others, etc.

Ship-owners (long term): complementary guarantees for the long term financing of vessels built in PYMAR shipyards.

In the case that a Ship-owner contracting the construction of a fishing vessel in a PYMAR shipyard requires complementary guarantees for the obtaining of bank financing, the FPG is able to issue a complementary guarantee to vessel's mortgage up to 30% of the financing loan (exceptionally that rate could be higher). For the issuing of that guarantee, PYMAR will request the following counter guarantees (although each application must be individually studied, hereunder are listed the more usual):

Right of subrogation in the guarantees originally granted in favor of the bank. Evidence of the existence of sufficient fishing quota for the vessel to pay its running expenses plus loan duties during the financing period (or for a period acceptable for the financing bank and PYMAR).

Evidence of the possibility to keep the above quota for the vessel if the Ship-owner fails in his loan obligations and the vessel must be transferred to other Ship-owner.

Control through an agreement with the Owner of the follow up of the maintenance of the vessel's value.

For the control of vessel operation and Owner obligations usually the vessel is registered in a friendly legislation country and leased to the end user.
FPG has worked with almost all the Spanish and International Banks. On February of 2006 PYMAR signed an agreement with Vnesheconombank to cooperate in the financing of vessels for Russian Ship-owners using the above mentioned mechanisms of FPG.

FISHERY IN NORTH ATLANTIC: REALITY AND PROSPECTS