The ship, with about 40 people on board, was heading towards the island of Ambae in very rough seas on Friday but never arrived at its destination.
A total of 15 of those on board have been confirmed alive, but according to a statement from authorities in the country, "over 30 people are still missing at sea."
An investigation has now been launched.
"The accident appears to have been due to strong winds and a failure to heed shipping warnings. It may also have been due to negligence through overloading the vessel," the same statement says.
