We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Tuesday, 16 June 15
MERS: POTENTIAL CHARTERPARTY IMPLICATIONS - CLYDE & CO
 KNOWLEDGE TO ELEVATE
South Korea's current outbreak of Middle East Respiratory Syndrome (MERS) has been the focus of much international attention. The local impact of the outbreak has been severe, leading to nearly 3,000 schools being closed and over 5,500 people being quarantined as a result of possible contact with infected persons. The virus has so far infected over 150 people in the country and the World Health Organization (WHO) anticipates that cases will continue to surface despite indications that the outbreak is now being brought under control. Whilst public health experts do not anticipate any form of worldwide pandemic to result from the situation in South Korea, it is feared that there is scope for a regular pattern of MERS outbreaks to occur over the coming years.
The Potential Legal Impact of MERS on Charterparties
With cruise ships having cancelled calls to South Korean ports and confirmed cases of MERS in the port of Pyeongtaek, the outbreak may understandably give rise to concerns on the part of shipowners whose vessels are due to call in South Korea or the charterers of such vessels. Whether the outbreak will have legal implications on a charterparty will very much depend on the wording of the charterparty in question; standard form charterparties are unlikely to include wording dealing with outbreaks of infectious/contagious disease.
Safe Port Warranties
Shipowners are obliged to follow charterers' legitimate orders unless to do so would expose the crew to unacceptable risk. Whilst charterers under a time charter are obliged to nominate safe ports, in the absence of specific wording it is unlikely that an outbreak of MERS will render a port unsafe.
Even if an outbreak of disease is in the port city itself, as in Pyeongtaek, the port may remain safe as long as there are appropriate protective measures in place. As such, there is significant risk involved in an owner refusing an order to a port on the basis of unsafety owing to disease risk, since to do so wrongly would amount to breach of the charter for failure to follow a legitimate order.
If the facts are such that there is a significant risk to the health of the crew, then charterers may be asked to nominate an alternative port, but this may have knock-on consequences particularly if there are bills of lading issued. The best approach for owners will be to keep in close contact with their P&I Club who will be able to give timely and appropriate guidance as the situation develops.
Where a vessel is subject to a voyage charter, the prospective safety of a port is also an issue and the arguments are similar to those detailed above; as with time charters, it is likely to be difficult to demonstrate that a South Korean port is unsafe on account of MERS.
Quarantine and Deviation
In the event that a time-chartered vessel becomes subject to quarantine delays or is forced to deviate to land an ill crew member, the hire/off-hire provisions may result in the vessel being placed off-hire. The specific charterparty wording would need to be carefully considered to assess whether this might be the case.
Similar concerns also arise in relation to voyage charters. Shipowners may deviate for the safety of the crew but in such a scenario no additional freight will become payable, so such deviation is at their own expense. A defence of 'reasonable deviation' may come into play where the Hague or Hague-Visby Rules apply. In terms of quarantine, the usual position is that time spent/lost at the time of charterers' orders will count as laytime/demurrage, although this too will depend on the charterparty terms agreed.
Free Pratique
In order to commence laytime, a vessel requires free pratique clearance. Absent wording to the contrary in the charterparty, the usual position is that a master can give a valid notice of readiness (NOR) without first having all the customs documents and obtaining free pratique, provided that he has no reason to suppose that being document ready is anything other than a mere formality.
However, if the vessel has recently called to a port in an infected area, then the mere formality test may not assist, since the vessel is likely to be subject to quarantine delays while the health of the crew is ascertained. In such a scenario, unless a charterparty provision states otherwise, owners bear the risk of the delay, since they would be unable to give a valid NOR to start laytime running until free pratique clearance is obtained.
Force majeure
If the charterparty in question contains a force majeure clause, the question may also arise whether the MERS outbreak fulfils the requirements of a force majeure scenario. A typical clause of this type suspends and/or terminates performance of the charterparty on the occurrence of an extraordinary event, which is beyond the parties’ control and which impacts the ability of one or both of the parties to fulfil their contractual commitments. As such, force majeure is usually a high evidential hurdle to clear.
Whilst the WHO has described the MERS outbreak as 'large and complex', the organisation has not issued a travel ban relating to South Korea and although Hong Kong, Macau and Taiwan have advised against travelling to the country, their notices amounted to recommendations rather than official travel alerts. If the MERS outbreak becomes more widespread and/or travel bans are put in place, the possibility of the situation amounting to a force majeure event may strengthen, however, at present, the scope for force majeure appears limited, unless the wording of a particular clause is quite broadly drafted.
Comment
The South Korean government is working alongside the WHO to bring the current MERS outbreak under control, however as with any outbreak of infectious/contagious disease, the situation may raise concerns for shipowners and charterers who are aware of the potential disruption such incidents can cause.
Parties may wish to consider managing the risk associated with such outbreaks by inserting contagious/infectious disease clauses into prospective charterparties, thus avoiding the ambiguity which can arise in this area.
By Ik Wei Chong, Bethan Bradley and Aislinn Fawcett
About Clyde & Co
Clyde & Co is a dynamic, rapidly expanding global law firm focused on providing a complete legal service to clients in our core sectors.
Clyde & Co advises businesses that are at the heart of worldwide commerce and trade.
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Friday, 12 February 16
DRY BULK MARKET'S FORTUNES STILL TIED WITH CHINA'S ECONOMY - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
The inevitable slowdown of the Chinese economy was expected to hurt dry bulk shipping, but few expected the blow to be this hard, especially given ...
Friday, 12 February 16
COAL PRICES ARE EXPECTED TO DECLINE 13% IN 2016 TO $50 ATON, ON CONTINUED WEAK DEMAND AND OVERSUPPLY - WORLD BANK
COALspot.com: Thermal coal prices fell 9 percent in the fourth quarter on continued weak demand, high stocks, and surplus production, World Bank sa ...
Friday, 12 February 16
U.S. COAL PRODUCTION OFF 5.4% FROM LAST WEEK - EIA
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 12.9 million shor ...
Thursday, 11 February 16
GLOBAL NEWBUILDING ORDERBOOK IS SHRINKING ON A DAILY BASIS - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
2016 has started right where 2015 left off when it comes to newbuilding ordering activity, i.e. there are slim pickings to be had from shipyards ar ...
Wednesday, 10 February 16
SOUTH AFRICA IS HOPING TO SHIP MORE COAL TO INDIA IN 2016
COALspot.com: South Africa is hoping to boost coal exports to India after shipping a record 75.4 million tonnes of coal in 2015, industry officials ...
|
|
|
Showing 2566 to 2570 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Essar Steel Hazira Ltd - India
- Jorong Barutama Greston.PT - Indonesia
- Interocean Group of Companies - India
- Independent Power Producers Association of India
- Maheswari Brothers Coal Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ind-Barath Power Infra Limited - India
- Miang Besar Coal Terminal - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Petron Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Cement Manufacturers Association - India
- Indonesian Coal Mining Association
- Economic Council, Georgia
- White Energy Company Limited
- Barasentosa Lestari - Indonesia
- The University of Queensland
- Singapore Mercantile Exchange
- Manunggal Multi Energi - Indonesia
- Australian Commodity Traders Exchange
- Kalimantan Lumbung Energi - Indonesia
- Semirara Mining Corp, Philippines
- LBH Netherlands Bv - Netherlands
- SMC Global Power, Philippines
- Directorate Of Revenue Intelligence - India
- Goldman Sachs - Singapore
- Maharashtra Electricity Regulatory Commission - India
- Orica Australia Pty. Ltd.
- McConnell Dowell - Australia
- Borneo Indobara - Indonesia
- Attock Cement Pakistan Limited
- India Bulls Power Limited - India
- Commonwealth Bank - Australia
- The State Trading Corporation of India Ltd
- Sindya Power Generating Company Private Ltd
- AsiaOL BioFuels Corp., Philippines
- PowerSource Philippines DevCo
- Wood Mackenzie - Singapore
- Sree Jayajothi Cements Limited - India
- Port Waratah Coal Services - Australia
- Semirara Mining and Power Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Orica Mining Services - Indonesia
- Indogreen Group - Indonesia
- Straits Asia Resources Limited - Singapore
- Thai Mozambique Logistica
- Meralco Power Generation, Philippines
- SN Aboitiz Power Inc, Philippines
- Eastern Coal Council - USA
- Videocon Industries ltd - India
- PTC India Limited - India
- Central Java Power - Indonesia
- Africa Commodities Group - South Africa
- South Luzon Thermal Energy Corporation
- Trasteel International SA, Italy
- Thiess Contractors Indonesia
- Dalmia Cement Bharat India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Mercuria Energy - Indonesia
- Madhucon Powers Ltd - India
- Electricity Generating Authority of Thailand
- Ceylon Electricity Board - Sri Lanka
- Bhushan Steel Limited - India
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- Antam Resourcindo - Indonesia
- Lanco Infratech Ltd - India
- CIMB Investment Bank - Malaysia
- PetroVietnam Power Coal Import and Supply Company
- Renaissance Capital - South Africa
- Kaltim Prima Coal - Indonesia
- Jindal Steel & Power Ltd - India
- Merrill Lynch Commodities Europe
- Rio Tinto Coal - Australia
- Tata Chemicals Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Energy Development Corp, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Georgia Ports Authority, United States
- Uttam Galva Steels Limited - India
- Aboitiz Power Corporation - Philippines
- Sojitz Corporation - Japan
- Mjunction Services Limited - India
- Grasim Industreis Ltd - India
- Power Finance Corporation Ltd., India
- Iligan Light & Power Inc, Philippines
- Global Green Power PLC Corporation, Philippines
- Australian Coal Association
- SMG Consultants - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Carbofer General Trading SA - India
- Karaikal Port Pvt Ltd - India
- GMR Energy Limited - India
- Bukit Makmur.PT - Indonesia
- Marubeni Corporation - India
- Indika Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Bulk Trading Sa - Switzerland
- Bayan Resources Tbk. - Indonesia
- VISA Power Limited - India
- ICICI Bank Limited - India
- Aditya Birla Group - India
- Asmin Koalindo Tuhup - Indonesia
- Indian Energy Exchange, India
- Gujarat Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Price Waterhouse Coopers - Russia
- Alfred C Toepfer International GmbH - Germany
- Globalindo Alam Lestari - Indonesia
- Bangladesh Power Developement Board
- OPG Power Generation Pvt Ltd - India
- Electricity Authority, New Zealand
- ASAPP Information Group - India
- Banpu Public Company Limited - Thailand
- Indian Oil Corporation Limited
- Ministry of Transport, Egypt
- Siam City Cement - Thailand
- Krishnapatnam Port Company Ltd. - India
- Jaiprakash Power Ventures ltd
- Bharathi Cement Corporation - India
- Coal and Oil Company - UAE
- MS Steel International - UAE
- Metalloyd Limited - United Kingdom
- Vijayanagar Sugar Pvt Ltd - India
- Sakthi Sugars Limited - India
- Siam City Cement PLC, Thailand
- San Jose City I Power Corp, Philippines
- Altura Mining Limited, Indonesia
- Anglo American - United Kingdom
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- GAC Shipping (India) Pvt Ltd
- Planning Commission, India
- Ministry of Mines - Canada
- Cigading International Bulk Terminal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Chamber of Mines of South Africa
- Mercator Lines Limited - India
- Eastern Energy - Thailand
- Edison Trading Spa - Italy
- Malabar Cements Ltd - India
- Energy Link Ltd, New Zealand
- Bukit Baiduri Energy - Indonesia
- Medco Energi Mining Internasional
- Central Electricity Authority - India
- Formosa Plastics Group - Taiwan
- Billiton Holdings Pty Ltd - Australia
- The Treasury - Australian Government
- TNB Fuel Sdn Bhd - Malaysia
- Star Paper Mills Limited - India
- Agrawal Coal Company - India
- Petrochimia International Co. Ltd.- Taiwan
- Kartika Selabumi Mining - Indonesia
- Makarim & Taira - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Directorate General of MIneral and Coal - Indonesia
- Parry Sugars Refinery, India
- Bhatia International Limited - India
- Sical Logistics Limited - India
- Binh Thuan Hamico - Vietnam
- European Bulk Services B.V. - Netherlands
- Coalindo Energy - Indonesia
- Ministry of Finance - Indonesia
- Samtan Co., Ltd - South Korea
- Global Coal Blending Company Limited - Australia
- PNOC Exploration Corporation - Philippines
- Kohat Cement Company Ltd. - Pakistan
- Sarangani Energy Corporation, Philippines
- CNBM International Corporation - China
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Standard Chartered Bank - UAE
- Wilmar Investment Holdings
- GN Power Mariveles Coal Plant, Philippines
- New Zealand Coal & Carbon
- Mintek Dendrill Indonesia
- International Coal Ventures Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Larsen & Toubro Limited - India
- Karbindo Abesyapradhi - Indoneisa
- TeaM Sual Corporation - Philippines
- Gujarat Sidhee Cement - India
- Xindia Steels Limited - India
- London Commodity Brokers - England
- Ambuja Cements Ltd - India
- Parliament of New Zealand
- Heidelberg Cement - Germany
- Neyveli Lignite Corporation Ltd, - India
- Global Business Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- GVK Power & Infra Limited - India
- Riau Bara Harum - Indonesia
- Intertek Mineral Services - Indonesia
- Therma Luzon, Inc, Philippines
- Vizag Seaport Private Limited - India
- Vedanta Resources Plc - India
- Timah Investasi Mineral - Indoneisa
- Bhoruka Overseas - Indonesia
- Posco Energy - South Korea
- Oldendorff Carriers - Singapore
- Toyota Tsusho Corporation, Japan
- Latin American Coal - Colombia
- Minerals Council of Australia
- Simpson Spence & Young - Indonesia
- Coastal Gujarat Power Limited - India
- Kumho Petrochemical, South Korea
- Indo Tambangraya Megah - Indonesia
- Savvy Resources Ltd - HongKong
- Bahari Cakrawala Sebuku - Indonesia
- Baramulti Group, Indonesia
- Tamil Nadu electricity Board
- Romanian Commodities Exchange
- Chettinad Cement Corporation Ltd - India
- Deloitte Consulting - India
- Kepco SPC Power Corporation, Philippines
- Kideco Jaya Agung - Indonesia
|
| |
| |
|
