Documentary Committee meets in Edinburgh on 3 June 2015
The Documentary Committee, under Chairman Mr Karel Stes, met in Edinburgh on 3 June 2015 to approve new documents and clauses, review work in progress and identify projects for future development.
Immediate Past President, Mr John Denholm, former President Mr Michael Everard and members of the Executive Committee joined the meeting which was attended by shipowner and club representatives from BIMCOs worldwide membership together with observer organisations FONASBA, the International Group of P&I Clubs and INTERTANKO.
Approval was given in principle to a revised version of the New York Produce Exchange (NYPE) Time Charter Party subject to resolving one remaining issue related to the provision of certificates of financial responsibility for oil pollution. The revision of the NYPE form has been the focus of intensive discussions through a BIMCO Sub-committee with copyright holder ASBA, and in consultation with the Singapore Maritime Foundation. However, after some three years work, the new document incorporates up to date provisions reflecting changes that have taken place in legal, commercial and market practices over more than twenty years since the last revision.
A new addition to the BIMCO suite of documents is ROPAXTIME. This is a specialist time charter party reflecting user needs in ro-ro passenger vessel trades. As well as addressing the customary allocation of party rights and obligations under a time charter, it also spells out charterers responsibilities for the employment of on-board hotel and catering personnel; cleaning and servicing of cabins, restaurants and public spaces; maintaining high standards of hygiene; and liability for passengers and their welfare.
The LINERTIME Deep Sea Time Charter Party continues to be used in the markets. Nevertheless, in order to ensure that the content remains in line with contemporary needs, a technical revision has been undertaken to replace outdated war, stevedore damage and dispute resolution provisions with the latest clauses.
Clauses to protect parties against dealings with internationally proscribed persons and entities have previously been developed respectively for charter parties and sale and purchase agreements. In recognition of the fact that similar protection is necessary to protect parties and ensure sub-contractors bona fide in ship management contracts, a parallel provision the Designated Entities Clause for SHIPMAN 2009 was adopted.
In response to concerns about questionable practices in the conduct of fumigation operations, a specialist new Cargo Fumigation Clause for Charter Parties (covering both time and voyage charters), has been developed for the dry cargo sector. The provision which is triggered at charterers option and at their risk, responsibility and expense, sets out a regime based on IMO Recommendations for undertaking fumigation and MARPOL Annex V procedures for the removal of fumigant remains.
Reviewing bills of lading
Work is underway to review BIMCOs portfolio of bills of lading and waybills to incorporate, where appropriate, the revised Himalaya Clause which brings ship managers within the scope of carrier defences and, also, to align the signature boxes with the latest ICC UCP 600 Rules. Changes to liner bills and other self-standing documents are relatively straightforward and, as a first step, amendments to CONLNEBILL were approved. However, charter party bills are more problematic to avoid creating inconsistency with the underlying document. A specialist Working Group is being formed to supervise the review.
Approval was given to amend the Bunker Fuel Sulphur Clause for Time Charter Parties 2005 to address two practical issues. The first is to close a gap which can be exploited in some areas, such as the USA, where charterers are able to file a notice of non-availability of low sulphur fuel without owners knowledge. This may have later repercussions, possibly after redelivery, so a provision will be added requiring charterers to inform owners whenever such a claim is filed. The second point is that different low sulphur fuels are not always compatible with each other. Appropriate text will therefore be developed requiring compatibility.
An adjustment was also agreed to the Bunker Operations and Sampling Clause amending the minimum number of fuel samples to be taken from seven to five.
New York arbitration
Following agreement between the US Maritime Law Association and the Society of Maritime Arbitrators, the requirement for arbitrators to be commercial persons no longer applies. It was agreed that the US Law/New York Arbitration Clause in the BIMCO Dispute Resolution Clause should be amended accordingly. In the meantime, a proposal to review the rationale and content of the US option for mediation will be taken forward.
Corruption, through demands for gifts such as cigarettes, alcohol or cash payments as the price of officials carrying out their duties, is an everyday problem encountered by owners in many parts of the world. Corporate undertakings are increasingly insisting on the contractual inclusion of anti-corruption provisions which, by their terms, can have harsh implications for owners in the event of a minor or technical breach. Work is therefore continuing within a small Sub-committee to devise a clause balancing party interests and setting out a regime to be followed when owners come under pressure to make unlawful payments.
Work has begun on the development of a standard term sheet for ship financing transactions. The project is being taken forward by a specialist Sub-committee comprising representatives from BIMCO, international banks with experience of ship financing and legal interests representing owners and lenders. At this stage, discussions are concentrating on identifying the underlying structure of the document and types of loans to be included.
It will, from time to time, be agreed that a party to a contract will be replaced by another entity. Such changes are usually made through novation. At present, there is no standard form for the shipping industry and each agreement is separately negotiated. In order to provide a reference basis, work is underway to develop two forms respectively for novation for the substitution of time charterers and transfer of vessel ownership.
Carriage of LNG is an important and growing trade. A new LNGVOY Voyage Charter Party is under development to address the technical issues associated with this specialised trade where natural cargo boil off can, within limits, be used as free fuel during a voyage.
A new Standard Contract for the Supervision of Vessel Construction is being developed for project-related newbuilding supervision operations. Parties will be able to agree the scope of services to be provided from a range covering specification review, plan approval, makers list review and site supervision.
Work has started on revision of SUPPLYTIME 2005. A preliminary meeting has taken place where key parts of the document were identified for revision and updating. A small Sub-committee will be assisted by a wider sounding board of industry experts to put forward views and suggestions as work progresses.
Changes in Canada
In response to changed requirements recently confirmed by the Canada Border Services Agency (CBSA), work is in hand to update the Canadian element of the North American Advance Cargo Declaration Clause for both time and voyage charter parties.
A number of BIMCOs older charter parties are not readily compatible with computer software. Documents printed in two columns of text are difficult to read and amend on a screen. The problem is therefore being addressed through reformatting to bring layout into line with contemporary technology.
After having completed the maximum permitted three terms of office, Mr Karel Stes stepped down as Chairman. Members of the Documentary Committee expressed their warm appreciation of his hard work and commitment over the last six years.