Panama is still the leading ‘flag state’ for ships registered when it comes to the absolute number of ships, followed by the Marshall Islands and Liberia. Malta is the first European country on place 6.
There is a business practice called ‘Flag of convenience (FOC)w’ hereby a ship’s owners register a merchant ship in a ship register of a country other than that of the ship’s owners, and the ship flies the civil ensign of that country, called the flag state.[ Each merchant ship is required by international law to be registered in a registry created by a country, and a ship is subject to the laws of that country, which are used also if the ship is involved in a case under admiralty law. A ship’s owners may elect to register a ship in a foreign country which enables it to avoid the regulations of the owners’ country which may, for example, have stricter safety standards.