Maritime Industry on the 100th Anniversary of Cabotage

Maritime Affairs in Our Century of Cabotage

On July 1, 2026, Turkish maritime affairs crossed one of the most significant thresholds in its history. On this date, the Cabotage Law came into effect, and as of today, it has reached its hundredth year. The Law No. 815, which came into force on this date in 1926 (Official Gazette 19.04.1926/359), is the registration of independence won at Lausanne on the seas, and it is the flag of our national sovereignty in blue waters. The centenary should serve not only as a reason for celebration but also as an occasion for reflection. How do we utilize this right, which our ancestors entrusted to us a century ago? What are the achievements that we can proudly write in our ledger, and what are the losses that should be recorded? In this article, in honor of the hundredth year, I will try to address both with the same honesty. As Kâtip Çelebi narrated centuries ago in Tuhfetü'l-Kibâr, the costs of the state turning its back on the sea were significant. It is our generation's duty to turn our faces towards the sea and engage with maritime transport, culture, tourism, fishing, and education in every aspect.

The Meaning of a Century-Old Trust

When we think of cabotage, many of us only consider the transportation of cargo and passengers between our coasts being exclusive to Turkish-flagged vessels. However, the system established by Law No. 815 is much broader. Services such as piloting, towing, captaincy, steering, crewing, diving, and fishing within our ports and territorial waters have also been exclusively reserved for Turkish citizens. This choice was not a whim of protectionism but rather a result of bitter experiences. During the era of capitulations, we could not have a say in our own ports. We had to rely on foreign companies, even foreign pilot captains, in our own waters. The Cabotage Law is the courage born from this captivity. Its fundamental philosophy was not only to protect local elements but also to ensure safety and sovereignty in our seas. The territory we call "homeland" legally consists of three parts: land, air, and sea. Our maritime territory, which we refer to as our blue homeland, is protected by cabotage, which serves as the title deed of this territory.

The data revealed at the 5th Turkey Maritime Summit held in Istanbul immediately after the Cabotage Day clearly shows the state we entered the hundredth year in. As of January 1, 2026, the Turkish-owned merchant fleet consists of 2,234 vessels and has a capacity of 51.8 million DWT, making it the eleventh largest fleet in the world. Our ports handled a record 573 million tons of cargo last year, welcoming 63,000 vessels; container throughput exceeded 14 million TEUs. Considering that the total handling of the United Kingdom, which consists of several countries, remained at around 400 million tons, it is not an exaggeration to say that the ports handling the most cargo in Europe are now in Turkey.

Let’s continue. We are among the top in the world in supplying seafarers. Our sailors wave the Turkish flag across the seven seas and provide significant foreign currency inflow to the country. Our maritime education system has successfully passed inspections by the IMO and EMSA, and our country has maintained uninterrupted membership in the IMO Council since 1999. The IMSAS inspection completed in 2024 has once again confirmed that our maritime administration is above international standards. Our shipyards built the world's first sailing Ro-Ro vessel. Fully electric ferries are being constructed in our facilities, and the expertise gained in commercial vessels has transformed into a defense industry capable of producing the world's best warships. We are among the top three countries in ship recycling. We pass nearly ninety thousand vessels through the Turkish Straits each year without incident; the world's narrowest yet safest waterways are in our hands. With the renewal of the golden share rights granted to us by the Montreux Convention starting in 2022, our revenue from the strait crossings reached 254 million dollars this year. While cruise tourism was nearly zeroed out during the pandemic, we reached 2.2 million passengers last year; the expectation for this year is 2.5 million.

This picture represents a success story, considering where a country that "even rented its boats from foreigners" stood a century ago. But is everything rosy? No, it is not. Now, let’s honestly look at the other side of the coin.

Do Exceptions in Tourism Weaken Cabotage?

Over time, our cabotage regime has been softened by certain exceptions in the tourism sector. With the Tourism Encouragement Law No. 2634, foreign-flagged yachts have been allowed to cruise between our ports for tourism purposes; in cruise transportation, foreign-flagged vessels have effectively become regulars along our coasts. The economic justification for these exceptions is understandable; indeed, more than one-fifth of our tourism revenue, which exceeds 60 billion dollars, is related to maritime tourism, and no one should consider closing this window. The fact that our coves stretching from Marmaris to Bodrum are a favorite of global yachting is a result of geography and the quality of our services, not cabotage; the exception has enhanced this value.

However, a balance must not be lost here. Exceptions should not swallow the rule. Unless the share of the Turkish flag in the transport sector of maritime tourism is increased, the gaps opened in cabotage on the tourism front will widen year by year. Our goal should not be to drive away foreign-flagged yachts but to grow the Turkish-flagged yacht and cruise fleet through tax and regulatory arrangements that make our flag attractive.

Turkish International Ship Registry

One of the significant items in the hundred-year accounting is the Turkish International Ship Registry (TUGS), established by Law No. 4490 dated 1999. The objective aimed by this law was indeed correct. It was to bring back the Turkish-owned fleet that had fled to foreign flags by offering tax incentives. Providing the opportunity for registered vessels to benefit from income and corporate tax exemptions has undoubtedly contributed to the competitiveness of our fleet.

However, the quarter-century that has passed indicates two structural problems. The first is the employment aspect. According to Law No. 4490, it is mandatory for the captain of vessels registered in TUGS to be a Turkish citizen. However, for vessels with Turkish ownership operating outside the cabotage line, it is sufficient for only 51% of the crew to be Turkish. If the owner is foreign, all crew members except the captain can be foreign. It is incompatible with the spirit of cabotage that a country that trains hundreds of thousands of seafarers and graduates bright officers from maritime faculties each year cannot find positions for its own children on its own flagged vessels. Indeed, if the owners of vessels registered in TUGS meet the conditions of being Turkish citizens, they can also benefit from cabotage rights. The first article of cabotage protects the vessel, while the second and third articles protect the people. The TUGS regulation has weakened this second aspect. The second issue is that the primary purpose of TUGS, the "return to the flag," has been partially realized: a significant portion of our Turkish-owned fleet still sails under foreign flags today. Reflecting this success of our fleet, which has risen to eleventh in the world, onto our national flag is one of the tasks of the second century. The path to this does not lie in prohibition but in a bold reform that will make the registry more attractive.

Gatekeepers of Our Ports Under Tender Pressure

Let’s move on to the most pressing issue of the hundredth year. My readers who follow this column know; perhaps the most strategic of cabotage rights are the piloting and towing services, which are the gatekeepers of our ports. The pilot captain is an expert who blends the entire maritime memory of the region with instantaneous decisions. The tugboat is the muscle of the port. A maneuver performed by a tanker with insufficient tug support poses a potential environmental disaster. That is why Law No. 815 has reserved these services exclusively for Turkish flags and Turkish citizens.

With the regulation added to the Ports Law No. 618 by Law No. 7519 in 2024 (Official Gazette 09.07.2024/32597), these services have been opened to tender based on a "public share" to be deducted from gross revenue. Tenders started with a base rate of 40% and continued with the principle that the highest share committed would win. The results are evident. When the Samsun tender concluded at 58% in May 2025, the sector referred to it as a "loss tender." A few months later, İskenderun reached 88%. In the Kocaeli-1 tender, a proposal committing to leave 89.5% of gross revenue to the public won the right to operate for twenty years. A well-established organization with nearly thirty years of experience in İzmit Bay, over fifty pilot captains, and more than fifteen thousand maneuver experiences per year lost its area despite submitting an 89% bid. As I have previously written in this column, piloting has turned into a sort of vegetable and fruit "market": The broker shouts, the share flies; safety remains under the counter.

Let’s do a simple arithmetic. If 89.5% of gross revenue goes to the public, then 10.5% remains for the operator. While it is known that the average gross profit margin in this service sector is around 18%, can a pilot captain's fee be paid with 10.5%, or can a tugboat worth millions of dollars (even renewed once every ten years!!!) be purchased, or training be provided? There are two outcomes to this equation: Either the tariffs will become exorbitant, or the service will deteriorate. It’s like Nasreddin Hodja’s account: If the meat is here, where is the cat; if the cat is here, where is the meat? Moreover, as one side of this seesaw rises, the other must inevitably fall: As the public share increases, the safety side lightens. Instead of seeking Aristotle's "golden mean," we have written excess into the tender specifications.

Can a Discerning Merchant Be Governed by an Indiscreet Administration?

The response of the administration to this picture is perhaps the most thought-provoking aspect of the issue. The expressed approach is as follows: "They made the offers themselves; they are merchants; they must act wisely; they bear the consequences." Anyone familiar with commercial law cannot dispute the first half of this sentence. According to TCC Art. 18/2, every merchant must act as a prudent businessman in their commercial activities. This is true. But it is incomplete. Because the measure of a prudent merchant is a criterion that establishes a balance of interests between the parties in private law. It does not eliminate the administration's obligation to oversee the continuity and regularity of the public service it undertakes. Piloting and towing are not ordinary commercial activities; they are public services related to navigation safety and environmental protection. When the operator crushed under a high share commitment goes bankrupt tomorrow, it will not just be a company that sinks; there will be a service gap, a safety deficit, and ultimately a risk that will be charged to the nation. When a tanker runs aground, the cost to be paid far exceeds the public share collected. As Cicero said two thousand years ago: Salus populi suprema lex esto—the safety of the people shall be the highest law. Governing is not just saying "you made the offer"; it is about foreseeing, balancing, and applying the brakes when necessary.

In a rule of law, the tools for this are also available. Although piloting tenders are not directly subject to Law No. 4734, the "excessively low bid" inquiry in Article 38 of the same law is instructive: An explanation is requested from the bidder whose sustainability is in doubt; if the explanation is insufficient, approval is not granted. Article 20 of Law No. 4735 allows for termination if it is understood that the obligation cannot be fulfilled properly. Moreover, these tenders have been completed while the judicial review, which I will mention below, has not yet concluded. The IMO's Resolution A.960 and IMPA principles require that the pilot captain works free from commercial pressure; however, the system we have established has turned commercial pressure into a tender criterion itself.

Tenders Completed Before the Lawsuit Ended

At this point, it is necessary to record, with regret but in a respectful manner, an observation regarding the other pillar of the rule of law. Legal action had already been taken against both Law No. 7519 and the underlying regulation before the tender processes had effectively begun. During the time that has passed, tenders were held one after another, concluded, and transfer processes began. However, according to information reflected in the public domain, the lawsuits have not yet been resolved, and no decision has even been made regarding the requests for a stay of execution. The very purpose of the stay of execution institution, as expressed in Article 27 of the Administrative Procedure Law, is to prevent the occurrence of damages that are difficult or impossible to remedy. To put it in the immortal principle of the Mecelle, "the judgment is according to the purpose of the work." If a measure aimed at preventing fait accompli is decided after the fait accompli has been completed, it loses its function. Legal experts will assess how sufficient a cancellation decision to be given after the transfer of twenty-year operating rights and the establishment of the actual situation will be in resolving the ensuing chaos. The purpose of these lines is certainly not to accuse the high judiciary, which we all know has a heavy workload; rather, it is to point out a systemic issue. Article 125 of the Constitution subjects all actions and transactions of the administration to judicial review, and Article 36 guarantees the freedom to seek rights; in the language of the ECHR case law, these guarantees must be "not theoretical and illusory, but practical and effective." While the universal maxim that delayed justice is not justice is evident, procedural regulations that will ensure that requests for a stay of execution are prioritized and resolved urgently in disputes concerning strategic public services like maritime safety should be placed on the legal agenda of the second century.

What is the World Doing?

Let’s take a moment to look at the horizon. The United States, the bastion of liberal economics, applies the world's strictest cabotage regime with the Jones Act; piloting and towing are entirely in the hands of local elements, and note that the federal government does not directly take a share from these services. The revenues are reinvested in port infrastructure. In the Netherlands and Belgium, services are awarded to private companies through concession methods. However, tenders are conducted not based on price but on service quality, safety standards, and environmental sustainability criteria. In Zeebrugge, even the emission standards of the tugboats were a condition for the winning company. As far as I know, there is no other maritime country that takes a high public share from gross revenue and makes it a topic of increasing in tenders. It is a strange twist of history that Turkey, which set an example to the world a century ago by winning cabotage, is now auctioning safety with a model of its own invention in its hundredth year.

The Course of the Second Century

So, what should be done? Complaining is easy. My approach is to also suggest solutions. It is certainly legitimate for the state to generate revenue from these services; however, the revenue should be planned at a balance that does not compromise safety. To achieve this: A reasonable upper limit should be set for the public share; offers exceeding this limit should not be accepted without an independent financial sustainability analysis. In tenders, the sole criterion should be removed from being the share ratio; corporate experience, qualified personnel, fleet age, safety management systems, accident records, and financial adequacy should be scored together. Cautious behavior should be exercised in new tenders until the pending Constitutional Court and Council of State processes are concluded; requests for a stay of execution should be prioritized for decision; and the preservation of regional experience and trained human resources should be mandated in transfer processes. (Although there are hardly any tenders left as they have all been nearly completed; in other words, "The horse has already crossed Üsküdar!") The sources flowing into the revolving fund should be transparently reported on a project basis regarding which maritime investment they have been converted into. The crew regime of TUGS should be reviewed to strengthen the employment of Turkish seafarers; incentives should be created to make the Turkish flag attractive in maritime tourism.

The Century-Old Trust is Strong, but the Ship Needs Maintenance

In its hundredth year, the main body of our maritime affairs is solid. However, there are areas starting to gather algae below the waterline, and in maritime affairs, it is said, "a ship that is not well checked from its hull should not go to sea." Cabotage is not only a badge of pride left to us by our ancestors; it is also a trust that we will pass on to our descendants. The spirit of this trust is hidden in three words: safety, sovereignty, employment. If we hand over the gatekeepers of our ports to tender brokers while boasting record handling figures, and if we cannot find a place for our own seafarers on our ships while expanding the fleet with registry conveniences, our centennial speeches will be in vain. The command of Gazi Mustafa Kemal Atatürk is still relevant: "We must think of maritime affairs as the great national ideal of the Turk and achieve it in a short time." We have accomplished much in a short time; that is true. But the ideal is not a finished job; it is an ongoing journey. As we enter the second century, our duty is to protect these rights not just on paper but at the dock, on the bridge, and in court decisions; that is, in reality.

Happy centenary of our Maritime and Cabotage Day. Wishing for safe voyages...

Source: SeaNews Türkiye