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Tuesday, 08 December 15
HOW TO MITIGATE LEGAL RISKS WHEN PURCHASING BUNKERS - LESSONS LEARNED FROM THE OW BUNKER COLLAPSE - THE SWEDISH CLUB
 KNOWLEDGE TO ELEVATE
About a year has passed since OW Bunker & Trading A/S filed for bankruptcy. The collapse shows that there are significant risks for shipowners and charterers in using intermediaries for the supply of bunkers. On the one hand the intermediary issues an invoice in capacity as the contractual supplier and should be paid for the bunkers. On the other hand do physical suppliers in some jurisdictions have an independent right to claim the vessel for unpaid bunkers. As a result, there is an inherent risk for competing claims against vessels to the extent the intermediary fails to pass on the payment to the physical supplier.
The collapse of OW Bunker has not only generated disputes involving competing claims against vessel owners by contractual suppliers and physical suppliers, but also charterparty disputes between owners and charterers. The Club’s FD&D lawyers presently handle about 40 cases involving disputes following the collapse of OW Bunkers. The total sum of these disputes is in excess of USD 20 million. The legal issues are complex and case specific. For instance, it has been argued that OW Bunker or their assignees cannot claim payment at all under English law since they never owned the bunkers for which they issued an invoice. This argument was recently dismissed by the English Court of Appeal, see the Club’s Member Alert of 23 October 2015. In addition, a court decision in one country may not apply in another country. Therefore, as of today, no universal solution to the underlying dilemma with competing claims is in sight.
The OW Bunker collapse has generated important lessons for the future. The following steps may be taken by owners and charterers in order to bring contractual clarity in relation to the supply of bunkers, as well as mitigate the risk for competing claims:
Insert BIMCOs non-lien clause in the charterparty, see Special Circular from BIMCO.
Prior to ordering bunkers, the supplier should be provided with the following notice (this is linked to the above non-lien clause):
To: Bunker Sellers (Name, address and contact details)
Take note that we, (Charterers: Name, address and contact details) are today (date) ordering (specification of) bunkers for supply at (port or place) on or about (date) on our account and our credit to MV/MT………… on charter to us and that the bunkers to be supplied to the Vessel are solely for our account as Charterers and that neither the Vessel, the Owners nor the Master is a party to the bunker supply contract and no lien, encumbrance or any rights shall arise on the Vessel.
Yours faithfully
Charterers of MV/MT………
Avoid any reference on the Bunker Delivery Receipt to the physical supplier’s own Terms and Conditions in order to avoid creating a direct contract between the vessel owner and the supplier.
Stamp and sign the Bunker Delivery Receipt with the following wording:
Vessel…………………
This bunker supply is for account of vessel’s time charterers, Messrs………………
I herewith declare that neither owners / bareboat charterers nor the vessel are responsible for payment of this supply and no lien or other claim against the vessel can therefore arise.
Date:
……………………………………………………………
Master / Chief Engineer
Explore possibilities to take out insurance to protect against the risk of charterer (or bunker intermediary) insolvency
As mentioned above, the use of a bunker intermediary will entail an enhanced risk in relation to the supply of bunkers. Members may therefore consider agreeing to only deal with physical bunker suppliers directly and, if so, a provision to that effect should be inserted in any time charterparty.
In the event an intermediary is used the following precautionary steps can be taken:
Endeavour to ensure that the intermediary has an appropriate credit insurance.
Endeavour to agree to pay the intermediary the profit element only by way of paying the physical supplier separately, or by way of making one payment to the intermediary which is split into two; the intermediary receives the profit element as principal and the substantive sum as agent for the physical supplier. At least the first alternative needs to be expressed in the contract with the intermediary.
Endeavour to ensure that the ultimate buyer has the longest credit period in the contractual chain by way of a term in the contract with the intermediary that the intermediary has to first pay their supplier in full for the bunkers before the ultimate buyer is obliged to pay them.
Finally, a word of caution. There is no magic answer which will eliminate all legal risks in relation to the supply of bunkers. All situations differ and there are different parties involved in supply chains. However, the above constitute steps that owners and charterers can take to try to mitigate those risks as much as possible, in appropriate circumstances. It is acknowledged that the steps may be difficult to take in practice.
Source: The Swedish Club | Hellenic Shipping News
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Thursday, 28 January 16
WHAT ARE THE PROSPECTS FOR COAL IN LIGHT OF THE PARIS CLIMATE AGREEMENT? - GERMAN COAL IMPORTERS ASSOCIATION
This depends – says the VDKi – to a very great extent on who you want to believe more, the United Nations or the International Energy A ...
Thursday, 28 January 16
RICHARDS BAY COAL SWAPS FOR Q1,Q2 AND Q3 DELIVERIES FIRM THIS PAST WEEK
COALspot.com: Q1’ 2016 API4 FOB Richards Bay Coal swap rose month over month and week over week.
The Q1’ 2016 FOB Richards Bay Coa ...
Wednesday, 27 January 16
API 5 FOB NEWCASTLE COAL SWAPS CLOSE MIXED
COALspot.com: API 5 FOB Newcastle Coal swap for Q1’ 2016 delivery rose another $1.17 per ton (3.13%) this past week compared to the sam ...
Wednesday, 27 January 16
CHINA'S STALLING ECONOMY HAS HAD A GREAT EFFECT ON VARIOUS COMMODITIES; DECREASED DEMAND DRIVING COMMODITY PRICES LOWER AND LOWER - LINOS ALEXANDROS KOGEVINAS
Having gone through the first few weeks of 2016, it’s starting to look like another challenging year is ahead of us. Hopes for a recovery in ...
Wednesday, 27 January 16
WORLD HARD COAL PRODUCTION AND CONSUMPTION DECLINE IN 2015 FOR THE FIRST TIME IN OVER A DECADE - VDKI
COALspot.com: Seaborne hard coal trade and the changes in this area were decisively affected by China and India - VDKi.
China bears the g ...
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Showing 2586 to 2590 news of total 6871 |
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- Tamil Nadu electricity Board
- Essar Steel Hazira Ltd - India
- Binh Thuan Hamico - Vietnam
- Trasteel International SA, Italy
- Chamber of Mines of South Africa
- Bhoruka Overseas - Indonesia
- Salva Resources Pvt Ltd - India
- Aditya Birla Group - India
- Africa Commodities Group - South Africa
- Power Finance Corporation Ltd., India
- Energy Link Ltd, New Zealand
- Wood Mackenzie - Singapore
- Krishnapatnam Port Company Ltd. - India
- Medco Energi Mining Internasional
- Wilmar Investment Holdings
- Indian Oil Corporation Limited
- Miang Besar Coal Terminal - Indonesia
- Videocon Industries ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Sojitz Corporation - Japan
- Grasim Industreis Ltd - India
- Kaltim Prima Coal - Indonesia
- Kartika Selabumi Mining - Indonesia
- Eastern Coal Council - USA
- Indogreen Group - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Agrawal Coal Company - India
- Asmin Koalindo Tuhup - Indonesia
- Formosa Plastics Group - Taiwan
- Mintek Dendrill Indonesia
- Ind-Barath Power Infra Limited - India
- Straits Asia Resources Limited - Singapore
- Malabar Cements Ltd - India
- Chettinad Cement Corporation Ltd - India
- Posco Energy - South Korea
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- TeaM Sual Corporation - Philippines
- Thai Mozambique Logistica
- SMG Consultants - Indonesia
- Interocean Group of Companies - India
- GVK Power & Infra Limited - India
- Mercuria Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Parry Sugars Refinery, India
- Karbindo Abesyapradhi - Indoneisa
- Gujarat Sidhee Cement - India
- Makarim & Taira - Indonesia
- Bangladesh Power Developement Board
- Orica Mining Services - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- European Bulk Services B.V. - Netherlands
- Meralco Power Generation, Philippines
- Sarangani Energy Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Billiton Holdings Pty Ltd - Australia
- International Coal Ventures Pvt Ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sical Logistics Limited - India
- Dalmia Cement Bharat India
- Cigading International Bulk Terminal - Indonesia
- White Energy Company Limited
- Ministry of Finance - Indonesia
- Borneo Indobara - Indonesia
- Bukit Baiduri Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kepco SPC Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- Gujarat Mineral Development Corp Ltd - India
- India Bulls Power Limited - India
- Semirara Mining Corp, Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Karaikal Port Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- PNOC Exploration Corporation - Philippines
- Merrill Lynch Commodities Europe
- Ceylon Electricity Board - Sri Lanka
- Pendopo Energi Batubara - Indonesia
- ICICI Bank Limited - India
- Savvy Resources Ltd - HongKong
- Baramulti Group, Indonesia
- Semirara Mining and Power Corporation, Philippines
- Singapore Mercantile Exchange
- Vijayanagar Sugar Pvt Ltd - India
- Economic Council, Georgia
- VISA Power Limited - India
- Commonwealth Bank - Australia
- Tata Chemicals Ltd - India
- Xindia Steels Limited - India
- Holcim Trading Pte Ltd - Singapore
- Bharathi Cement Corporation - India
- Global Business Power Corporation, Philippines
- Central Java Power - Indonesia
- Timah Investasi Mineral - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Uttam Galva Steels Limited - India
- CNBM International Corporation - China
- Alfred C Toepfer International GmbH - Germany
- Romanian Commodities Exchange
- Bukit Makmur.PT - Indonesia
- Sree Jayajothi Cements Limited - India
- The University of Queensland
- Price Waterhouse Coopers - Russia
- Meenaskhi Energy Private Limited - India
- Carbofer General Trading SA - India
- Samtan Co., Ltd - South Korea
- Petrochimia International Co. Ltd.- Taiwan
- Rashtriya Ispat Nigam Limited - India
- Ambuja Cements Ltd - India
- Kideco Jaya Agung - Indonesia
- Anglo American - United Kingdom
- Lanco Infratech Ltd - India
- Riau Bara Harum - Indonesia
- The Treasury - Australian Government
- Energy Development Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Antam Resourcindo - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Minerals Council of Australia
- TNB Fuel Sdn Bhd - Malaysia
- Toyota Tsusho Corporation, Japan
- Indo Tambangraya Megah - Indonesia
- Thiess Contractors Indonesia
- Orica Australia Pty. Ltd.
- PowerSource Philippines DevCo
- Iligan Light & Power Inc, Philippines
- Siam City Cement - Thailand
- Simpson Spence & Young - Indonesia
- IEA Clean Coal Centre - UK
- Altura Mining Limited, Indonesia
- Bayan Resources Tbk. - Indonesia
- Deloitte Consulting - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Renaissance Capital - South Africa
- Star Paper Mills Limited - India
- London Commodity Brokers - England
- McConnell Dowell - Australia
- Larsen & Toubro Limited - India
- Bhushan Steel Limited - India
- Petron Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indonesian Coal Mining Association
- ASAPP Information Group - India
- Sinarmas Energy and Mining - Indonesia
- Vedanta Resources Plc - India
- Aboitiz Power Corporation - Philippines
- GAC Shipping (India) Pvt Ltd
- Global Coal Blending Company Limited - Australia
- Global Green Power PLC Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Australian Commodity Traders Exchange
- San Jose City I Power Corp, Philippines
- Goldman Sachs - Singapore
- Cement Manufacturers Association - India
- Electricity Generating Authority of Thailand
- Vizag Seaport Private Limited - India
- South Luzon Thermal Energy Corporation
- Neyveli Lignite Corporation Ltd, - India
- OPG Power Generation Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Kalimantan Lumbung Energi - Indonesia
- IHS Mccloskey Coal Group - USA
- Coal and Oil Company - UAE
- The State Trading Corporation of India Ltd
- New Zealand Coal & Carbon
- Parliament of New Zealand
- GN Power Mariveles Coal Plant, Philippines
- Attock Cement Pakistan Limited
- Eastern Energy - Thailand
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- SN Aboitiz Power Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Sakthi Sugars Limited - India
- Kumho Petrochemical, South Korea
- Barasentosa Lestari - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Independent Power Producers Association of India
- Rio Tinto Coal - Australia
- Metalloyd Limited - United Kingdom
- Ministry of Transport, Egypt
- PTC India Limited - India
- Bhatia International Limited - India
- Bulk Trading Sa - Switzerland
- PetroVietnam Power Coal Import and Supply Company
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- GMR Energy Limited - India
- Mercator Lines Limited - India
- Therma Luzon, Inc, Philippines
- Edison Trading Spa - Italy
- Port Waratah Coal Services - Australia
- Banpu Public Company Limited - Thailand
- Jorong Barutama Greston.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Coalindo Energy - Indonesia
- Australian Coal Association
- SMC Global Power, Philippines
- Heidelberg Cement - Germany
- Madhucon Powers Ltd - India
- MS Steel International - UAE
- CIMB Investment Bank - Malaysia
- Indika Energy - Indonesia
- Mjunction Services Limited - India
- Latin American Coal - Colombia
- Electricity Authority, New Zealand
- Kobexindo Tractors - Indoneisa
- Planning Commission, India
- Central Electricity Authority - India
- Ministry of Mines - Canada
- Coastal Gujarat Power Limited - India
- Georgia Ports Authority, United States
- Indian Energy Exchange, India
- Marubeni Corporation - India
- Maheswari Brothers Coal Limited - India
- Standard Chartered Bank - UAE
- Jindal Steel & Power Ltd - India
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