{"id":399774,"date":"2026-10-26T18:00:14","date_gmt":"2026-10-26T12:30:14","guid":{"rendered":"https:\/\/www.scconline.com\/blog\/?p=399774"},"modified":"2026-10-26T18:01:10","modified_gmt":"2026-10-26T12:31:10","slug":"coastal-shipping-licencing-of-foreign-flag-vessels-rules-2026-notified","status":"publish","type":"post","link":"https:\/\/www.scconline.com\/blog\/post\/2026\/10\/26\/coastal-shipping-licencing-of-foreign-flag-vessels-rules-2026-notified\/","title":{"rendered":"Coastal Shipping (Licencing of Foreign Flag Vessels) Rules, 2026: Overview, Key Provisions and Implications"},"content":{"rendered":"<div style=\"text-align: justify; line-height: 150%;\">\n<p style=\"margin-bottom: 3%;\">On 14 October 2026, Ministry of Ports, Shipping and Waterways, notified the <span style=\"font-weight: bold;\"><a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-9003150527\" target=\"_blank\">Coastal Shipping (Licencing of Foreign Vessels) Rules, 2026<\/a><\/span>, framed under the powers conferred by sub-section (1) and clauses (a), (b), (c), (d), (i), (j), (k), (l), (m), (n), (o) and (q) of sub-section (2) of section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-9002847159\" target=\"_blank\">39<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-9002847681\" target=\"_blank\">Coastal Shipping Act, 2025<\/a>.<\/p>\n<p>These Rules establish the framework for licensing foreign-flag vessels engaged in Indian coastal trade and certain international trade operations involving Indian charterers.<\/p>\n<p style=\"font-weight: bold;\">Key highlights:<\/p>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">1. Applicability<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>These Rules apply to foreign-flag vessels in India&#8217;s coasting trade and vessels chartered by entities under Section <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-9002847129\" target=\"_blank\">11(1)<\/a> of the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-9002847681\" target=\"_blank\">Coastal Shipping Act, 2025<\/a>.<\/p>\n<\/li>\n<li>\n<p>A licensing framework for foreign vessels has been established under the Rules.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">2. Definitions Introduced<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>Rule 3 introduces key definitions for the purposes of the Rules, including <span style=\"font-weight: bold;\">&#8220;EXIM Trade&#8221;<\/span> and <span style=\"font-weight: bold;\">&#8220;Foreign Flag Vessel.&#8221;<\/span><\/p>\n<\/li>\n<li>\n<p>The term <span style=\"font-weight: bold;\">&#8220;port&#8221;<\/span> has been assigned the meaning given under the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-9002847681\" target=\"_blank\">Coastal Shipping Act, 2025<\/a>.<\/p>\n<\/li>\n<li>\n<p><span style=\"font-weight: bold;\">&#8220;Appellate Authority&#8221;<\/span> means the authority designated under the <a href=\"https:\/\/www.scconline.com\/DocumentLink.aspx?q=JTXT-9002837308\" target=\"_blank\">Indian Ports Act, 2025<\/a> for hearing appeals under these Rules.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">3. Types and categories of licence<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>Rule 4 recognises the following licence types:<\/p>\n<ul style=\"list-style-type: square;\">\n<li>\n<p>Voyage Charter;<\/p>\n<\/li>\n<li>\n<p>Time Charter; and<\/p>\n<\/li>\n<li>\n<p>Contract of Affreightment.<\/p>\n<\/li>\n<\/ul>\n<\/li>\n<li>\n<p>Licences may be issued under different categories, including:<\/p>\n<ul style=\"list-style-type: square;\">\n<li>\n<p>Export;<\/p>\n<\/li>\n<li>\n<p>Import;<\/p>\n<\/li>\n<li>\n<p>Coastal;<\/p>\n<\/li>\n<li>\n<p>Worldwide; and<\/p>\n<\/li>\n<li>\n<p>Offshore operations.<\/p>\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">4. Application and time limit<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>Under Rule 4(3), the applications must be submitted to the Director-General as per the First Schedule, at least <span style=\"font-weight: bold;\">72 hours<\/span> before the laycan date.<\/p>\n<\/li>\n<li>\n<p>The Second Schedule prescribes a <span style=\"font-weight: bold;\">late fee of &#8377;50,000<\/span>.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">5. Licence fees and payment<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>Fees are prescribed in the Second Schedule and paid through Bharatkosh portal.<\/p>\n<\/li>\n<li>\n<p>Additional charges may apply for late applications and licence modifications.<\/p>\n<\/li>\n<li>\n<p>The Rules prescribe an additional levy on charterers of offshore vessels that are not classed with the Indian Register of Shipping and are more than 25 years old.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">6. Document verification and licence issuance<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>Applicants must declare compliance with the Act and its Rules.<\/p>\n<\/li>\n<li>\n<p>Documents may cover Right of First Refusal, CoA Guidelines, vessel age, quality standards and Indian crew placement.<\/p>\n<\/li>\n<li>\n<p>The Director-General issues the licence after verification and may impose additional conditions.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">7. Extension and modification<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>Extensions may be requested for delayed voyages; no NOC is required for extension applications under Rule 7(1).<\/p>\n<\/li>\n<li>\n<p>Modifications require an application through the e-Samudra portal and payment of applicable fees.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">8. Mandatory licence for port clearance<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>A valid licence must be presented for port clearance by the licensee or vessel&#8217;s agent.<\/p>\n<\/li>\n<li>\n<p>Applies to foreign-flag vessels engaged in coasting or chartered for EXIM trade.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">9. Compounding of offences<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>Applications for compounding must be made to the designated <span style=\"font-weight: bold;\">compounding officer<\/span> in the prescribed format under the Fourth Schedule.<\/p>\n<\/li>\n<li>\n<p>The compounding officer may accept or reject applications; rejection requires a hearing opportunity and written reasons.<\/p>\n<\/li>\n<li>\n<p>The amounts payable are determined under the Fourth Schedule.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">10. Appeals against penalties<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>Appeals against penalty orders must be filed with the Director-General within 30 days of receiving the order.<\/p>\n<\/li>\n<li>\n<p>Appeals must follow the Fifth Schedule and include the penalty order.<\/p>\n<\/li>\n<li>\n<p>Filing is permitted in person, through an authorised representative or advocate, by speed post or electronically.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">11. Foreign-Flag Vessel Compliance<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>Where a foreign-flag vessel is detained under the Act, the relevant <span style=\"font-weight: bold;\">consular office of the vessel&#8217;s flag State<\/span> must be informed.<\/p>\n<\/li>\n<li>\n<p>The Rules also prescribe a separate procedure for notifying consular offices regarding proceedings initiated against licensees, agents or operators of foreign-flag vessels.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-left: 18pt; text-indent: -18pt; font-weight: bold;\">12. Schedules and their contents<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>First: Licence applications and supporting documents.<\/p>\n<\/li>\n<li>\n<p>Second: Licence fees and late fees.<\/p>\n<\/li>\n<li>\n<p>Third: Licence format.<\/p>\n<\/li>\n<li>\n<p>Fourth: Compounding applications and amounts.<\/p>\n<\/li>\n<li>\n<p>Fifth: Appeals and procedures.<\/p>\n<\/li>\n<li>\n<p>Sixth: Notices regarding detention of foreign-flag vessels.<\/p>\n<\/li>\n<li>\n<p>Seventh: Notices regarding proceedings against licensees or agents.<\/p>\n<\/li>\n<\/ul>\n<p style=\"font-weight: bold;\">Overall significance<\/p>\n<ul style=\"list-style-type: disc;\">\n<li>\n<p>The Coastal Shipping (Licensing of Foreign Vessels) Rules, 2026 establish licensing requirements for foreign vessels engaged in Indian coastal and EXIM trade.<\/p>\n<\/li>\n<li>\n<p>Prescribe application deadlines, fees, and document verification procedures.<\/p>\n<\/li>\n<li>\n<p>Ensure compliance with Indian crew placement and Right of First Refusal (RoFR) guidelines.<\/p>\n<\/li>\n<li>\n<p>Mandate a valid licence for port clearance.<\/p>\n<\/li>\n<li>\n<p style=\"margin-bottom: 3%;\">Provide procedures for compounding offences and appealing against penalties.<\/p>\n<\/li>\n<\/ul>\n<p style=\"margin-bottom: 3%;\">The Rules apply to foreign-flag vessels participating in coastal trade and to specified vessels chartered by Indian citizens, NRIs, OCIs and eligible entities for international voyages.<\/p>\n<p style=\"font-weight: bold;\">Read Also:<\/p>\n<p><a href=\"https:\/\/www.scconline.com\/blog\/post\/2025\/08\/12\/coastal-shipping-act-partially-repealed-merchant-shipping-act\/\" target=\"_blank\">Coastal Shipping Act, 2025 partially repeals Provisions of Merchant Shipping Act, 1958 dealing with Control of Indian Ships and Ships Engaged in Coasting Trade<\/a><\/p>\n<p style=\"margin-bottom: 3%;\"><a href=\"https:\/\/www.scconline.com\/blog\/post\/2016\/12\/07\/salient-features-of-the-draft-inland-vessels-bill-2016\/\" target=\"_blank\">Salient Features of the Draft Inland Vessels Bill, 2016<\/a><\/p>\n<p style=\"margin-bottom: 3%;\">[Coastal Shipping (Licencing of Foreign Flag Vessels) Rules, 2026, dated 14-10-2026]<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p style=\"font-style: italic;\">The Coastal Shipping (Licensing of Foreign Vessels) Rules, 2026 establish a strict regulatory and licensing framework for foreign-flagged vessels operating in Indian coastal, export-import (EXIM), and offshore waters.<\/p>\n","protected":false},"author":67548,"featured_media":399777,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4,15],"tags":[118098,118109,118100,118099,118106,118105,118101,118108,118107,118102,74911,61310,118110,118103,118104],"class_list":["post-399774","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-legislationupdates","category-rules_regulations","tag-coastal-shipping-licencing-of-foreign-flag-vessels-rules-2026","tag-coastal-shipping-licence","tag-coastal-shipping-regulations","tag-coastal-shipping-rules-2026","tag-coastal-trade-regulations","tag-foreign-vessel-operations-in-india","tag-indian-maritime-law","tag-indian-shipping-industry","tag-maritime-compliance","tag-maritime-policy","tag-maritime-trade","tag-merchant-shipping","tag-shipping-industry-compliance","tag-shipping-licence","tag-vessel-licensing-framework"],"yoast_head":"<!-- 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