By the OGJ Online Staff
LONDON, Oct. 2 -- The UK Court of Appeal has ruled that drilling rigs operating in the UK sector of the North Sea should be classed as ships for income tax purposes.
The decision is unlikely to have any financial implications for operators or for rig rates, but it will affect how crewmembers are paid. The ruling that jack-up rigs with floating hulls are "ships" entitles those working on them seafarers tax relief.
The Court of Appeal has ruled that "ship" is an ordinary English word and the matter is one of fact, not of law. It is likely to make working on jack-up rigs more financially attractive for crews registered as British taxpayers.
The case has been running since 1991 and follows claims for tax relief from three men who had worked on the jack-up rigs Santa Fe Magellan and the Santa Fe Monarch in the southern sector of the UK continental shelf.