OLEKSANDR RIFFA: I AM LEAVING THE REGISTER WITH A PRESERVED PROFESSIONAL TEAM, IN A PROFITABLE CONDITION, AND WITH REAL DEVELOPMENT PROSPECTSApril 5th, 2023
On April 5, 2023, Alexander Riffa held his final meeting as the CEO of the State Enterprise “Classification Society “Ship Register of Ukraine.” On his last working day, a conference call was held with the heads of the structural units, during which the team was thanked for their effective and coordinated work during challenging wartime conditions.
On November 9, 2021, by order of the Chairman of the State Maritime and River Transport Service of Ukraine, Alexander Riffa was appointed Acting CEO of the Ship Register of Ukraine. The enterprise, with which he was familiar as Deputy CEO for the previous four years, was in a difficult state at the beginning of November 2021. For the first time in its existence, the activities of the classification society resulted in a loss. According to the analysis conducted through an internal audit, this was due to the Registry’s refusal to provide some services to private entities in 2021, resulting in a loss of approximately 15 million UAH.
Operational management measures were implemented from the first days of work to eliminate the loss, stabilize the financial situation of the enterprise, and return the state funds to the revenue of the state enterprise. As a result, the loss, which was 11 million UAH as of October 1, 2021, was reduced to 4.8 million UAH within two months until the end of 2021.
Moreover, by the results of the first half of 2022, the Ship Register of Ukraine achieved a profitable financial outcome. This was accomplished during a state of war and full-scale conflict, amidst a mass exodus of professionals from the country, the suspension of navigation and operations of maritime enterprises in temporarily occupied territories, significant reduction in revenue from classification activities, vessel technical supervision, and convention certification.
“Since the beginning of the war, the enterprise’s operations have never been suspended, not even for a day. The Registry continued to provide services and fulfill orders from clients, despite the worsening situation in many regions of the country. The team worked in person, remotely, and on reduced working hours, but with faith in a better future. The effective work of the enterprise during the most difficult period for the country is a collective intermediate victory for all employees. Therefore, the confirmation is the financial result of the Registry for the year 2022: a net profit of 1.3 million UAH and 26 million UAH paid in taxes to the state budget,” stated Alexander Riffa.
A new challenge for the Ship Registry has emerged in the form of the activities associated with the inclusion of the State Enterprise “Scientific Research and Design Institute of the Ukrainian Navy” into the enterprise based on the corresponding order of the Maritime Administration. The institute’s financial losses and debts will impose a burden on the Registry’s financial state, but the management sees the integration as an opportunity to expand the range of services provided by the Registry. A corresponding action plan for the most effective implementation of the institute’s functionality within the Registry’s structure has been developed, and certain steps are being taken to realize it.
In the first quarter of 2023, the Registry also concluded with a positive financial outcome: compared to the same period in 2022, revenues increased by 8%, or 1 million UAH, and taxes amounting to over 5 million UAH were paid to the state budget.
An important and impartial criterion for the effective functioning of the Ukrainian Ship Registry is its international rating. According to the published data (White, Grey & Black List – WGB-List) of the Paris Memorandum of Understanding on Port State Control (Paris MoU) for 2022, the Ukrainian Ship Registry significantly improved its performance and climbed three positions in the ranking, securing the 21st place out of the 33 classification societies listed. This is the highest ranking in recent years and demonstrates the sound management, organizational decisions, professional work of the entire team, and a responsible approach to their work.
During the past year, the Registry expanded the range of its services, particularly in the field of certification, as part of the steps taken towards Ukraine’s membership in the European Union. Work has been carried out to synchronize national regulations in the maritime sector with the corresponding EU norms. The enterprise has effectively represented Ukraine’s interests in cooperation with the IMO, CESNI, and the Danube Commission. The Registry’s rules have been updated in accordance with modern requirements of European Directives and standards applicable to inland waterway vessels.
In 2023, the Ukrainian Ship Registry should continue the work initiated in 2022 with the administrations of European Union countries to obtain recognition in accordance with Directive (EU) 2016/1629 on inland waterway vessels. This also applies to working with Maritime Administrations to obtain authorization for conducting conventional certification of maritime vessels under their flag, in compliance with International Conventions.
“The motto of the Ukrainian Ship Registry is safety above all. The principles of our work team remain unchanged: quality, professionalism, systematic approach, and ambition. I am proud that during the most challenging times for our country and the Registry, together with my team, we managed to mobilize all our efforts, safeguard the only state enterprise providing classification and conventional services from bankruptcy, and lay the foundation for further success in line with the development strategy. I am grateful to the team for this opportunity and invaluable experience. The Registry will celebrate its 25th anniversary this summer. Therefore, I wish the enterprise to mark this milestone with new positive results and our shared victory over the enemy!” summarized Oleksandr Riffa.