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Japan Investigates Fraudulent Sale of Cargo Ship to Iran

Japan Investigates Fraudulent Sale of Cargo Ship to Iran
Feb 7, 2024

Japanese officials are investigating the 2021 sale of a small cargo ship owned by a public entity that they believe may have been fraudulently exported to Iran. They are focusing on a Japanese trading company that acted as a cash buyer and may have submitted false documents during the public auction of the vessel.

According to a report in the Japanese news outlet The Yomiuri Shimbun, police have searched the offices of an Osaka-based trading company that purchased the vessel in 2021. In documents filed in the public auction and after successfully winning the vessel, a 1,450 dwt general cargo ship, the Osaka company reported it was acting as an intermediary and would be delivering the ship to a company based in the UAE.

While Japanese law does not forbid the sale of the vessel to Iran, they are raising concerns that the sale might be in violation of Customs Law due to the false declaration and the undisclosed export of the vessel to Iranian interests. There are also concerns due to the U.S. sanctions on many Iranian interests.

The public auction was conducted in April 2021 by the Japan Railway Construction, Transport and Technology Agency (JRTT), which is an Independent Administrative Institution separate from the Transport Ministry and responsible for rail construction and supporting domestic shipping and shipbuilding. The agency in the auction documents advised buyers they were responsible for obtaining the necessary certifications if the sale was for overseas.

The vessel, the Jousan Maru No. 18, was built in 1997 in Japan and is 499 gross tons with a length of 206 feet (63 meters). JRTT was the 80 percent owner of the ship along with Kyowa Shipping, and they laid the vessel up in February 2021. It was declared surplus and offered for sale “as-is” with reports saying the final sale price was 32 million Yen (approximately $216,000).

The Equasis database reflects the ship as now registered in Tanzania and named Amitis. The registered owner lists an address in Port Rashid, Dubai, in the United Arab Emirates. AIS data shows it is active in the Persian Gulf, making recent port calls in Iran, Kuwait, and the UAE.

The investigation is reportedly looking into the details of the ship’s export, how it is being used, and the ownership. JRTT told the Kyodo News network that it was cooperating with the investigation which is currently underway.