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Palau's government has terminated its long-standing commercial agreement with its flag registry operator due to U.S. Treasury sanctions impacting the Palau-flagged fleet. The Ministry of Public Infrastructure and Industries announced that the flag registry will continue operations under new management, emphasizing a commitment to governance and oversight.

The previous management firm, which began operating the registry in 2012, faced concerns over certain vessels linked to sanctions, including tankers associated with Iran's Hossein Shamkhani network and LNG carriers connected to Russia. Amendments to Palau's Maritime and Admiralty Act will facilitate a gradual transition for the shipping register, granting the president authority to appoint a new manager. The changes aim to ensure continuity of service amid past issues of seafarer abandonment.