BIMCO Issues New Ice Clauses

When the Documentary Committee of BIMCO met on November 14, 2002 in Copenhagen, Denmark, they agreed to adopt a revision of its General Ice Clause for voyage charter parties. The revision of the General Ice Clause forms part of an undertaking to review over time a series of well-known BIMCO standard clauses to reflect legal and commercial developments. The amendments have been made because the existing ice clause was found to be deficient in a number of ways, in particular that the vessel should not be required to follow ice breakers or to force ice. It was also felt that provisions were needed to protect the owners against the risk of ice being experienced on the approach voyage. Consequently a revised General Ice Clause has been drafted to take the above concerns into consideration. A provision has been included that the vessel should not be obliged to force ice but, subject to the owners’ approval, may follow ice-breakers when reasonably required. In addition, in the event that ice impedes the vessel from arriving at the loading port, the clause now contains three options for the charterers to: (1) nominate an alternative safe and accessible port; (2) agree to reckon laytime as if the port were accessible or; (3) declare that they cancel the charter party. Such option must be declared to the owners within 48 running hours, which is the period deemed reasonable as the charterers must be allowed time to make arrangements either for the cargo to be transferred to or a substitute cargo made available from an alternative port of loading.

Where part of the cargo has been loaded and the master is concerned that the vessel may be frozen in, sub-clause (a)(ii) requires the master/owners to notify the charterers that the vessel is leaving for the nearest safe place and will there await the charterers’ nomination of an alternative safe port. If the charterers fail to make the necessary nomination within 24 running hours, Sundays and holidays excluded, the vessel may leave and complete with cargo at another port, whether or not on the customary route for the chartered voyage. Since this may be considered a deviation under bill(s) of lading issued for the cargo loaded (and which do not incorporate the terms and conditions of the charter party), a note has been added highlighting that such bill(s) must contain an express statement permitting the vessel to complete with cargo at alternative port(s), whether or not on the customary route for the chartered voyage. Sub-clause (b)(i) relating to Port of Discharge provides the charterers with an option of either keeping the vessel waiting until the port is again accessible or of ordering the vessel to an alternative port. In addition, the sub-clause has been amended to refer to “compensation in an amount equivalent to the rate of demurrage” which is considered more accurate as the vessel might not be on demurrage at the time she is kept waiting by the charterers. In line with the current General Ice Clause, sub-clause (b)(ii) permits the vessel to leave the port for danger of being frozen in. However, the charterers now have the option to nominate an alternative safe and accessible port, such option to be communicated to the owners within 24 running hours, Sundays and holidays excluded. It is recognized that the 24-hour period may be extended because of holidays, however, the charterers must be given sufficient time to make arrangements for receiving the cargo at an alternative port. It is the intention that the Documentary Committee will develop for adoption a similar clause for use in time charter parties in May 2003. __________

Delay for Charterers’ Purposes Clause The “Cusdel” Clause, which dates back to 1965, was originally designed to compensate the owners for delays waiting for cargo documentation in connection with customs clearance. As the clause has now been restructured to apply generally to all charterers’ purposes, the heading has been changed to “Delay for Charterers’ Purposes Clause”. Previously the Clause allowed the charterers three hours free time, which was considered inconsistent with common practice. Consequently, the new clause reduces the free time to two hours and, if exceeded, all time used including the two hours is to be compensated to the owners in an amount equivalent to the rate of demurrage.

__________ General Ice Clause for Voyage Charter Parties The Vessel shall not be obliged to force ice but, subject to the Owners’ approval and having due regard to its size, construction and class, may follow ice-breakers when reasonably required. (a) Port of Loading (i) If at any time after setting out on the approach voyage the Vessel’s passage is impeded by ice, or if on arrival the loading port is inaccessible by reason of ice, the Master or Owners shall notify the Charterers thereof and request them to nominate a safe and accessible alternative port. If the Charterers fail within 48 running hours, Sundays and holidays included, to make such nomination or agree to reckon laytime as if the port named in the contract were accessible or declare that they cancel the Charter Party, the Owners shall have the option of cancelling the Charter Party. In the event of cancellation by either party, the Charterers shall compensate the Owners for all proven loss of earnings under this Charter Party.

(ii) If at any loading port the Master considers that there is a danger of the Vessel being frozen in, and provided that the Master or Owners immediately notify the Charterers thereof, the Vessel may leave with cargo loaded on board and proceed to the nearest safe and ice free place and there await the Charterers’ nomination of a safe and accessible alternative port within 24 running hours, Sundays and holidays excluded, of the Master’s or Owners’ notification. If the Charterers fail to nominate such alternative port, the vessel may proceed to any port(s), whether or not on the customary route for the chartered voyage, to complete with cargo for the Owners’ account.* (b) Port of Discharge (i) If the voyage to the discharging port is impeded by ice, or if on arrival the discharging port is inaccessible by reason of ice, the Master or Owners shall notify the Charterers thereof. In such case, the Charterers shall have the option of keeping the Vessel waiting until the port is accessible against paying compensation in an amount equivalent to the rate of demurrage or of ordering the Vessel to a safe and accessible alternative port. If the Charterers fail to make such declaration within 48 running hours, Sundays and holidays included, of the Master or Owners having given notice to the Charterers, the Master may proceed without further notice to the nearest safe and accessible port and there discharge the cargo. (ii) If at any discharging port the Master considers that there is a danger of the Vessel being frozen in, and provided that the Master or Owners immediately notify the Charterers thereof, the Vessel may leave with cargo remaining on board and proceed to the nearest safe and ice free place and there await the Charterers’ nomination of a safe and accessible alternative port within 24 running hours, Sundays and holidays excluded, of the Master’s or Owners’ notification. If the Charterers fail to nominate such alternative port, the vessel may proceed to the nearest safe and accessible port and there discharge the remaining cargo. (iii) On delivery of the cargo other than at the port(s) named in the contract, all conditions of the Bill of Lading shall apply and the Vessel shall receive the same freight as if discharge had been at the original port(s) of destination, except that if the distance of the substituted port(s) exceeds 100 nautical miles, the freight on the cargo delivered at the substituted port(s) shall be increased proportionately. * Note: In trades where the terms and conditions of the charter party are not incorporated into the bill(s) of lading, such bill(s) must contain an express statement permitting the vessel to complete with cargo at alternative port(s), whether or not on the customary route for the chartered voyage. __________ Delay for Charterers’ Purposes Clause If the Vessel is prevented from leaving the port after completion of loading/discharging for more than two (2) hours waiting for cargo papers or for any other reason attributable to cargo being loaded or discharged including but not limited to control and/or clearance by customs or other authorities and/or any other charterers’ purposes, the Charterers shall pay the Owners compensation in an amount equivalent to the rate of demurrage stipulated in the charter party for all time after completion of loading/discharging until the termination of such delay.