BIMCO formed a group of experts that will help draft a new Just In Time Clause, focusing on contractual issues, commenting that JIT does not just depend on an efficient operational framework.
Specifically, Just In Time (JIT) enables vessels to receive information in advance of calling a port, so they can time their arrival at the berth.
The basic concept is that the speed of a ship will be adjusted to arrive at a designated place at a specified time where it can proceed immediately to a berth or terminal.
To achieve this, all key stakeholders in the process need to be involved such as pilots, tugs, agents and other nautical services providers. JIT has the potential to significantly reduce waiting time at anchorages which in turn will reduce the port’s “carbon footprint”. Instead of ships’ following the common practice of “hurry up and wait” when proceeding to ports, their adjusted speed will reduce fuel consumption, reduce emissions and save costs. The overall length of a voyage remains unchanged as the JIT regime simply absorbs into the sea passage what would otherwise be waiting time and possibly time on demurrage.
It is commented that voyage charter parties oblige the ship to proceed with utmost or due despatch; However, JIT runs contrary to this by introducing an option to reduce passage speed. This means that a clause is required to allow the parties to depart from the normal contractual provisions.
The group will address changes that need to happen, such as in the case that an adjustment of the ship’s speed that may result in the ship running close to or beyond its cancelling date at the loading port, as this must also be addressed to prevent that owners have their ship cancelled, even if the delayed arrival is in response to a request by charterers.
In addition, the question of benefit sharing must be addressed. A charterer may save on potential demurrage bills by adjusting the arrival of the ship, but owners will benefit from reduced fuel consumption. If fuel prices are very high, owners may gain considerably more than charterers, and the incentive for charterers to use JIT may be lost.
Concluding, BIMCO notes that the group of experts leading the team consists of Raoul Baart from Anthony Veder and Paul Brown from Ineos. The group also includes North P&I’s Steve Cockburn. The drafting team will also produce a clause promoting the use of IMO data elements for communicating ship arrival and departure information in a standard “global” format between ships and ports.
A first draft of the new clauses will be reviewed by BIMCO’s Documentary Committee at their next meeting in January 2021.
