Arbitration is the most commonly used dispute resolution mechanism in shipping and offshore contracts. However, parties often tend to spend little or no effort reflecting on the type of arbitration solution chosen (ie, ad hoc versus institutional arbitration). This article highlights the benefits of agreeing to arbitration under the rules of the Nordic Offshore and Maritime Arbitration Association versus ad hoc arbitration.
Supplytime has been the industry standard time charter for offshore support vessels for decades. However, in recognition of its broader usage within the offshore and renewables sector as a whole, the Baltic and International Maritime Council recently published four new annexes for special tasks that can be incorporated into this popular standard contract.
A recent Supreme Court decision examined the mandatory scope of the Insurance Contract Act and the application of the general Time Bar Act in direct actions against protection and indemnity insurers under Norwegian law. The dispute arose out of an incident that took place in China in 2007, during which capesize vessel Mineral Libin made contact with another vessel and a buoy when berthing.
Under the Maritime Code, a shipyard which constructs or repairs a ship may retain physical possession of that ship until it has been paid by the relevant shipowner. The right of retention for non-payment is one of the key weapons in the arsenal of shipyards and enables them to exert a significant amount of pressure on both shipowners and other creditors to require prompt payment as and when it is due.
Shipowners routinely give buyers in demolition sales complete freedom to deal with ships as they please following a sale, but do so at their peril. Shipowners are generators of waste under the Basel Convention and other laws and remain liable as such following a sale. Further, shipowners and those assisting them in such transactions may also incur liabilities in tort to third parties in connection with shipyard worker injuries and environmental damage occurring after a sale, as noted in a recent High Court judgment.
The Court of Appeal recently endorsed a first-instance Admiralty Court decision that a failure to properly prepare a passage plan or properly mark up navigational charts to reflect navigational dangers may amount to a failure to exercise due diligence to make the vessel seaworthy, leading to an actionable fault defence for cargo interests who had refused to contribute to the general average.
The Norwegian regulations on ship registration have been criticised for being complicated and outdated, thereby making the Norwegian ship registers unattractive compared with more flexible alternatives offered by the so-called 'flags of convenience'. In response to such criticism, Parliament recently passed a bill effecting certain amendments to the relevant legislation aimed at opening up and facilitating the parallel registration of ships (bareboat registration) both in and out of the Norwegian ship registers.
The Admiralty Court recently handed down a judgment which looked in detail at the scope and meaning of the Convention on Limitation of Liability for Maritime Claims – in particular, the meaning of the phrase "the operator of the ship" in Article 1(2). In determining the meaning of 'operator', it was also necessary for the court to examine the meaning of 'manager'. This is the first time that the English courts have been called on to consider this issue.
A recent High Court decision provides an in-depth analysis of how, if at all, the prevention principle applies to shipbuilding contracts and the importance of good contract management to notify and seek extensions for events of delay. The dispute arose in the context of 11 arbitrations between a seller and a buyer concerning a series of 14 bulk carriers which were to be designed and constructed by the seller in China.
The fast spread of COVID-19 worldwide and the actions taken by regulatory bodies have created challenges for the shipping industry in particular given its international character. Much information is available, but it is fragmented. This article set outs several issues of importance and gives basic information to help parties handle the situation at hand in the best possible manner.
The new sulphur content limits in Annex VI of the International Convention for the Prevention of Pollution from Ships recently came into effect. With the upcoming carriage ban at the forefront of everyone's minds, this article outlines some of the contentious issues which may arise as a consequence of the shift to compliant fuels or scrubbers for shipowners, charterers and operators – from disputes with bunker or scrubber suppliers to challenges with regulatory enforcement.
Since May 2019, six oil tankers have been attacked in the Strait of Hormuz. However, despite these attacks, vessels are still taking orders to sail through the strait, albeit with higher war risk insurance rates and, most likely, heightened crew concerns. At what point under UK law can owners refuse such voyage orders on the basis that the strait is contractually unsafe?
Project financing has historically been a popular investment scheme and source of capital in Norway for shipping projects. However, the Norwegian regulatory authorities recently published guidelines regarding the application of the alternative investment fund (AIF) regime to project finance entities. Issuers, advisers, arrangers and investors in shipping projects must be aware of the pitfalls of being captured by the wide definition of an 'AIF' and the steps that they can take in order to adapt to the regulations.
A recent High Court decision provided guidance on the rules of interpretation when construing guarantees that display characteristics of both on-demand and true guarantees. The case concerned a charterer guarantee, which was described as a parent company guarantee and had characteristics of both an on-demand guarantee and a true guarantee.
In the lead up to delivery under shipbuilding and offshore fabrication contracts where delivery is delayed, buyers may occasionally face claims that they have disrupted the contractor's progress in such a way that the contractor is entitled to an extension of the delivery date and/or damages for the additional costs incurred. A recent ruling from the Supreme Court involving land-based construction clarifies the requirements as to causation for such a claim to succeed.
Despite it being almost six years since the 2014 oil price crash, there appears to still be only limited appetite for new investments in the offshore space, with many offshore investors and other stakeholders appearing to be keeping their powder dry until more obvious signs of an upturn are visible on the horizon. This article examines the current situation and some of the contracting solutions in the offshore markets.
The Supreme Court recently clarified that when determining whether a vessel is a constructive total loss under the Institute Time Clauses Hulls conditions, regard should be had to the costs incurred prior to the owner's notice of abandonment, but not to remuneration payable under a special compensation protection and indemnity clause. The decision is a landmark decision on marine insurance because of its financial and practical implications.
The UK Supreme Court's recent landmark decision in the Renos case clarifies that when determining whether a vessel is a constructive total loss under the English Institute Time Clauses Hulls conditions, regard should be had to the costs incurred prior to the owner's notice of abandonment, but not to remuneration payable under a special compensation protection and indemnity clause. But what would the position be under the 2019 version of the Nordic Marine Insurance Plan 2013?
Using liquefied natural gas (LNG) rather than fuel oil is one of a range of options available to owners seeking to comply with the International Maritime Organisation's 2020 regulations. Given that shipbrokers have long predicted the emergence of a two-tier shipping market with 'greener' ships commanding a premium over older, less eco-friendly vessels, what is the future for LNG bunkering and what challenges does it present?
Most parties involved in the shipping industry will by now have a clear picture of the requirements under the International Maritime Organisation (IMO) 2020 global sulphur cap on marine fuels. Therefore, attention has turned to the steps that must be taken to put these requirements into practice. Two clauses recently introduced by the Baltic and International Maritime Council aim to address certain contractual aspects of the IMO requirements as they apply to time charterparties.