Académique Documents
Professionnel Documents
Culture Documents
TUTORIAL NOTES
Chapter
Page
No.
Nature of Changes /
Amendments
Change
Authorised By
TABLE OF CONTENTS
Chapter
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
Page No.
Indian Merchant Shipping Act
Documentation
Custom House Procedures
Stowaways
Master-Pilot Relationship
Economics of Sea Transport
Shipping Practice
And Documents
Marine Insurance
International Institutions
Amendments to SOLAS,
MARPOL,
International Load lines etc.
Control Procedures
Port State Control
International Safety
Management Code (ISM Code)
Additional topics
ILO Conventions
IAMSAR
Ballast Water Management
CLC/FUND/HNS Conventions
London Convention
OPRC
4
24
31
37
48
68
80
130
158
192
224
237
250
270
The different parts of the Act came into force on different dates as indicated below:
(i) Parts I & II came into force on 15.12.1958
(ii) Part IV came into force on 17.3.1959
(iii) Section 7, Part XIV (including Section 405-414), Section 436, (in so far as it relates
to offences mentioned against S. o. 122 to 125 (both inclusive), Sections 437, 438, 439,
440, 441, 458, 459 and 460 and so much of section 461 and of part I of Schedule as
relates to the Control of Shipping Act, 1947 came into force on 1.4.1960
(iv) The remaining provisions of the original Act (except the amendments made
subsequently) came into force w.e.f. 1.1.1961
(v) Part VIA providing for obligation of certain certificate holders to serve Govt. or in
Indian Ships was inserted by amendment Act of 1979 came into force from 4.5.1979
(vi) Part IX A dealing with nuclear ships inserted by Amendment Act of 1966 came into
force from 28.5.1966
(vii) Part X A giving provisions for limitations of liability of owners in case of certain
damages inserted by Amendment Act of 1970, came into force from 15.9.1972
(viii) Part X B giving provisions for civil liability for oil pollution damage was inserted
by Amendment Act of 1983 came into force from 18.5.1983
(ix) Part XV A giving provisions for fishing boats inserted by Amendment Act of 1983,
which came into force from 18.5.1983
Layout of Merchant Shipping Act, 1958 (MSA 58)
The first Indian Merchant Shipping Act was enacted in 1923, the provisions of which
were in line with the U.K. Merchant Shipping Act, 1894. After independence, taking care
of new conditions and changes that have taken place in the Shipping Industry, a
comprehensive legislation passed by Indian Parliament in 1958 known as Merchant
Shipping Act, 1958. The Act has been constantly under revision and amendments to
ratify the changes approved by the International Maritime Organisation, through its
conventions and protocols, to which India is a Member.
The Merchant Shipping Act as is existed today has 24 parts. The basic provisions of Act
given in various parts are as under:
Part I deals with the preliminary giving short title of the Act and date of
commencement, application of the Act and definitions of the terms used in the Act. The
definitions have been given for 66 terms. Besides certain terms have been defined in their
appropriate part where they have occurred specifically.
Part II of the Act contains provisions relating to the establishment and composition of'
National Shipping Board, its functions and powers of the Government to make rules in
this respect for term of office of members, appointment of officers or other allowances of
Board members.
Part III deals with the General Administration, appointment of Director General,
establishment of Mercantile Marine Departments, Shipping Offices, Seaman's
employment offices and Seamens Welfare Offices. It also deals with the appointment of
Principal Officers at MMD, Mumbai, Calcutta and Madras and other officers at other
ports, appointment of surveyors, radio inspectors, Shipping Masters, Director of
Seamen's Employment Offices and Seamen's Welfare Officers.
Part IV - which dealt with the formation of Shipping Development Fund and
establishment of Shipping Development Fund Committee, has been abolished vide M.S.
(Amendment) Act of 1986 (66 of 1986)
Part V deals with the registration of Indian ships. It defines the Indian ships, contains
provisions for obligation to register, procedure for registration, Grant of certificate of
registry, endorsement for change of Master and Owner, provision far transfer of ships
shares etc., rules as to name of ship, provisions for registry of alternations registry a new
and transfer of registry, national character of the ships and flag etc.
Part VI - gives provisions relating to the certificates of officers - Masters, Mates,
Engineers, Skippers etc., and also requirements of officers on board various category of
ships. Review Committee has recommended that instead of specifying the manning scale
in the Act itself, Government should have rule making powers to prescribe different
manning scale for different types of ships and also to carry a safe manning document on
board the ship.
Part VI A contains provisions for obligation of certain certificate holders to serve
Government or in Indian ships.
Part VII deals with seamen and apprentices. It gives vide ranging provision for
classification of seamen, their engagements, discharge, payment of wages, their right for
wages dispute between seamen and employers, provisions for property of deceased
seamen and apprentices, distressed seamen, provisions for health and accommodation,
protection of seamen in case of litigation and other matters, provision as to discipline,
duties of Shipping Master, business of Seamen's employment offices and function of
National Welfare Board for seafarers, provisions for rule making powers for imposition
of the Board, term of office of members, procedure for conduct of business, levy of fee
for providing amenities to seamen and procedure for collection and recovery of Levy
fee.
Part VIII deals with passenger ships, their survey, Certificate of survey, powers of
surveyor, fee, duration of survey, etc. It provides for keeping order in passenger ships
specifying certain acts of persons as an offence under the act. This part also contains
provision for special trade passenger ships and pilgrim ships.
Part IX of the Merchant Shipping Act 1958 deals with the provisions relating to Safety.
This part gives the provisions relating to construction rules for ships, prevention of
collisions, life saving appliances and fire appliances, installation of radio telegraphy
radio telephony and direction finders, signalling lamp and provisions relating to stability
information. The part also deals with the provisions relating to Safety Certificates, Safety
equipment certificates, Safety radio telegraphy Certificates, exemption certificates, etc.,
provision for determining load lines, issue of load line certificates and special provisions
as to ships other than Indian ships. This part also provides powers to make rules as to
timber cargo, carriage of dangerous goods, grain loading plan and carriage of grain.
The provisions also exists for sub-division load lines, un-seaworthy Ships, detention
of unsafe ships and liability for cost of detention and powers to make rules to issue
certificates under this part.
Part IX A Deals with Nuclear Ships which includes application or non application of
certain provision of this Act to Nuclear ships, issue of Nuclear passenger and Nuclear
Cargo Ship Safety Certificate and powers to make rules in this respect.
Part X - This part deals with the collision, accident at sea and liability, which includes
provision for division of loss in case of collision, damages for personal injury etc.
Part X A - gives provision for limitation of liability of owners in case of certain
damages.
Part X B gives provision for civil liability for oil pollution damage. It embodies
provisions for limitation of liability of the owner, constitution of limitation fund,
consolidation of claims & distribution of fund amongst claimants, provision for
compulsory insurance or other financial guarantee and rule making powers.
Part XI - This part gives provision for regular method of giving helm orders, duty of
master to report danger to navigation, manner of communicating reports of danger to
navigations, obligation to render assistance to persons and ships in danger, etc. This part
is also under amendments in accordance with the recommendations given by the review
committee to include foreign flag vessels under purview, giving information by Indian
ships about position, course, speed to maritime administration and provision for Indian
ships to be fitted with prescribed navigational aids and equipments.
Part XI A Prevention and containment of pollution of sea by Oil:
This part contains provision for prevention of pollution and gives powers to Central
Government for prohibition as to discharge of oil and oily mixtures, inspection and
control of ships to which Oil Pollution Convention applies, maintenance or Oil record
book, oil reception facilities at the ports in India and powers of the
Government to take measures for preventing or containing oil pollution, direction to
certain ships to render assistance and levy of oil pollution cess. The Government under
the provision of this part can also frame rules.
This part does not contain provision for the action to be taken when oil is escaped. The
review Committee has recommended empowering the Central Government to take
appropriate action when oil is escaped.
Part XII: This part provides the provision for investigation and inquiries in shipping
casualties. It gives powers to the Court for holding formal investigations, to arrest
witnesses or enter the ships, to commit trial, to censure masters, mates or engineer, or to
remove master. Counsellor officer can appoint a marine board if the casualty occurs at
foreign waters. Central Government can cancel or suspend certificate of Master, Mate or
Engineer. Constitution of court of survey, reference in difficult cases to scientific persons
and investigation into explosions or fire on board of ship are the other provisions of this
part.
Part XIII - This part gives provision for matters relating to wreck and salvage. India has
ratified 1989 Salvage Convention and therefore review committee has suggested
that provisions of this Convention may be inserted amending Section 390, 398, 402 (1)
and 404.
Part XIV - of the Act gives powers to the Central Govt. for control of Indian ships and
ships engaged in coasting trade. Section 412 giving powers to fix shipping rates has
already been abolished. Some relaxation has also been given under cabotage law.
Part XV contains the provisions for sailing vessels and part XV A for fishing boats,
their registry, name, inspection, certification etc.
Part XVI gives the provisions for penalties for violation of the provisions of the Act and
procedure thereof.
Part XVII` contains miscellaneous provisions for appointing examiners, powers of ship
surveyor, inquiry into case of death on board the ships etc.
Indian Ships, Registration
Introduction
A ship entitled to fly the flag of a country needs to be registered in that country. The
object of registration is to ensure that persons who are entitled to the privilege and
protection of the Indian flag get them. The registration affords evidence of title off the
ship to those who deal with the property in question. It also gives protection to the
members of the crew in case of casualties involving injuries and/or loss of life to claim
compensation under the provisions of the Indian Acts in Indian courts.
Indian Merchant Shipping Act of 1958, for the first time, dealt with registration of ships.
Earlier acts had lacked this aspect totally. Part V of this Act deals with exclusively with
the registration of Indian ships, while Part XV deals with registration of sailing vessels
and Part XV A deals with the registration of fishing boats.
Inquiry or the Registrar or any other officer authorized by the Central Government or the
Indian Consular Officer depending upon whether the change has occurred in India or
abroad.
In the event of an Indian Ship being either actually or constructively lost, taken by the
enemy, burnt or broken up or ceasing for any reason to be an Indian ship, every owner of
the ship or any share in the ship is required to give a notice thereof to the Registrar and
thereupon the Registrar will make an appropriate entry in the Register Book and the entry
of the ship in that book would then be deemed mortgage that lies unsatisfied on that date
will, continue to remain in force. The Master of such a ship, if the event accrues in India,
will immediately make over the Certificate of Registry to the Registrar or within a period
of 10 days after his arrival in India if the event occurs elsewhere.
Transmission of an Indian ship or interest therein
Where the property in an Indian ship or share therein is transmitted to a person on the
death or insolvency of the registered owner or by any lawful means other than a transfer
described as above, it would be effected by an application made to the Registrar of the
ship's port of registry accompanied by a declaration in the prescribed form identifying the
ship and also a statement of the manner in which and the person to whom the property
has been transmitted. In the case of transmission consequent on insolvency, a declaration
of transmission has to be accompanied by proof of such claim. In the case of transmission
as a result of death, a Succession certificate, probate or letters of Administration, under
the Indian Succession Act, 1925 or a duly certified copy thereof, shall accompany the
declaration of transmission. The Registrar on receipt of the declaration of transmission
will make appropriate entry in the register book to give effect to the change in the
ownership.
Where as a result of the transmission of property in a ship or share there on death or
insolvency or otherwise a ship ceases to be an Indian ship, the Registrar of Port of her
registry will have to submit a report to the Central Government through the Director
General of Shipping setting out the circumstances in which the ship has ceased to be an
Indian ship. On receipt of such a report, Central Government can make an application to
the High Court for a direction for the sale of such Ship to any Indian citizen or any Indian
company. Such an application may have to be made to the High Court by the
Government within 60 days from the date of receipt of the report.
Importance of Signal Letters of a ship (Call Sign)
At the request of the owners of Indian ships desiring to be known at sea, the Director
General of Shipping, who will control the series that may be so issued, allots signal
letters. The allotment of such signal letters are required to be noted in the Register Book
and endorsed suitably on the Certificate of Registry. The allotment of signal letters will
form subject matter of a communication by the Director General of Shipping to the
Wireless Adviser, Ministry of Communication, New Delhi
(a) The agreement may be made for a voyage of the ship or if the voyages of the ship
average less than six months in duration, may be made to extend over two or more
voyages, and agreements so made are in the MSA 58 referred to as running agreements
(b) A running agreement may be made to extend over two or more voyages so that it shall
terminate either within six months from the date on which it was executed, or on the first
arrival of the ship at her port of destination in India after the expiration of that period, or
on the discharge of cargo consequent upon such arrival, whichever of these dates shall be
the latest. Provided that no such running agreement shall continue in force, if, after the
expiration of such period of six months as aforesaid, the ship proceeds on a voyage from
a port outside India to any other such port which is not on the direct route or a customary
route to her port of destination in India
(c) On every return to a port in India before the final termination of a running agreement,
the master shall discharge or engage before the shipping master at such port any seaman
whom he is required by law so to discharge or engage, and shall upon every such return
endorse on the agreement a statement (as the case may be) either that no such discharges
or engagements have been made or are intended to be made before the ship leaves port,
or that all those made have been made as required by law
(d) The master shall deliver the running agreement so endorsed to the shipping master,
and the shipping master shall, if the provisions of MSA 58 relating to agreements have
been complied with, sign the endorsement and return the agreement to the master.
Note of Protest
Is the ancient practice of noting of protest still worthwhile in today's world? Should
provisions be made by the companies to provide for noting of protest in their operating
procedures?
The answer is not straightforward but the following guidelines may be of help to masters
when considering the matter:
1). Noting of protest following an event, which has resulted in damage to the ship or her
cargo or injury to someone on board may be a requirement of the ship's flag state.
2). As a general rule, a note of protest has little, if any, evidential value in court. In most
common-law countries (including England, Canada, India, Australia, English-speaking
South-East Asian and African countries, and the USA), whatever might be said in the
note of protest will need to be established or substantiated in court by further evidence
which may include oral evidence from the master or evidence from independent sources.
3). In those countries where the Romano-Germanic system of law is applied (this
includes most of Continental Europe, French-speaking African countries, Latin America
and Japan), the noting of protest may still be of importance. In some countries, the protest
is still regarded as an essential formal step in the defence of a claim against the ship and
Year 1981
Provisions to enable the Co-operative Societies to own and register ships was
incorporated in the Act
Year 1983
The provisions of the International Convention on Control and Prevention of Pollution of
Sea by ships in accordance with the amendments to the 1954 Oil Pollution Convention;
giving provisions for civil liability for Oil Pollution damage, was incorporated in Part X
B of the Act. The 1983 amendment act also provided to insert new provisions for
registration of fishing boats, their inspection etc, in Part XV A of the Act,
Year 1984
Provisions in relation to Welfare of Seamen and insurance of crew of sailing vessels, etc.
was incorporated in the Act
Year 1986
Section 80 of the Act regarding grant of certificate of service to naval officers was
deleted from the Act, as the International Convention on Standards of training,
Certification and Watch-keeping 1978 (to which India is a party) does not permit grant of
certificates of service without examination
An Act called the Shipping Development Fund Committee (Abolition) Act, 1986 was
passed to abolish the SDFC constituted under the M.S. Act, 1958. The Central
Government delegated the Shipping credit and Investment Company of India Limited, a
Company registered under the Companies Act, 1956 (1 of 1956) with all its functions in
1987.
Year 1987
Provision with regard to manning of ships by certificated officers in accordance with the
Standards of Training, Certification and Watch-keeping Convention of 1978 was inserted
in the Act
Year 1988
Provisions of the International Convention on Civil Liability for Oil Pollution Damage,
1969 and its 1976 Protocol was inserted in Part X B of the Act
Year 1993
On the recommendation of the M.S.A Review Committee, the Sections 21,42,45,51, 412
and 414 of the M.S. Act, 1958 were amended. The Govt. of India in 1991 set up a
Review Committee under the Chairmanship of Director General of Shipping to review
the Merchant Shipping Act 1958 in its entirety taking into consideration the international
conventions which India has ratified but not enacted statutorily. The Committee has gone
into depth of the provisions of M.S. Act 1958 and has suggested wide ranging
amendments
of
various
sections
including
the
preamble.
These
suggestions/recommendations of the Review Committee are under consideration of the
Government to amend the M.S. Act 1958 for incorporating the same. The policy of
liberalisation adopted by the Government since 1991 has also been taken care of for
inclusion in the Merchant Shipping Act
INDIAN MERCHANT SHIPPING ACT (Latest Amendments) - Substitution of new
section for section 76 (44 of 1958)
CHAPTER II
Certificates of competency to be held by officers of ships
1. Every foreign-going Indian ship, every home-trade Indian ship of two hundred tons
gross or more when going to sea from any port or place in India and every ship carrying
passengers between ports or places in India shall be provided with officers duly
certificate under this Act according to the following scale, namely:
A duly certificate master
For foreign-going ship or a home-trade passenger ship of 150 tons gross or more, with at
least one officer besides the master holding a certificate not lower than that of first mate
in the case of a foreign-going ship and of mate in the case of a home-trade passenger ship
If the ship is a home-trade ship, not being a passenger ship, of four hundred and fifty tons
gross or more, with at least one officer besides the master holding a certificate not lower
than that of mate
If the ship is a foreign-going ship and carries more than one mate, then with the second
mate duly certificate.
Certificates of competency to be held by officers of ships
2. For section 76 of the Merchant Shipping Act, 1958 (hereinafter referred to as the
principal Act), the following section shall be substituted, namely:
(1) Every Indian ship, when going to sea from any port or place, shall be provided with
officers duly certificated under this Act in accordance with such manning scales as may
be prescribed:
Provided that the Central Government may prescribe different manning scales for
different types of ships.
(2) Every ship, whether at sea or in any port or place, shall engage such number of
persons and with such qualifications as may be prescribed for maintaining watches.
Power to make rules as to grant, cancellation or suspension of certificates of competency
The Central Government may make rules to carry out the provisions of this Part relating
to certificates of competency, and may, by such rules, (a) Prescribe the manner in which the horsepower of the engines of ships may be
calculated, and the methods by which such calculation may be made in respect of
different types of engines
(b) Provide for the conduct of the examination of persons desirous of obtaining
certificates of competency for the grades falling under section 78
(c) Prescribe the qualifications to be respectively required of persons desirous of
obtaining certificates of competency for the grades falling under section 78
(d) Fix the fees to be paid by applicants for examination
(e) Prescribe the form of such certificates and the manner in which copies of certificates
are to be kept and recorded
(f) Prescribe the circumstance or cases in which certificates of competency may be
cancelled or suspended.
Amendment of section 87
In section 87 of the principal Act, in sub-section (2), in clause (b), for the words by a
ship, the words by different types of ships shall be substituted.
Business of seamens employment offices
(1) It shall be the business of the seamen's employment offices:
(a) To regulate and control(i) The supply of such categories of seamen and for such class of ships as may be
prescribed;
(ii) The recruitment of persons for employment as seamen and the retirement of seamen
from such employment;
(iii) The promotion of seamen or changes of their categories;
(b) To maintain registers of seamen in respect of the categories prescribed under subclause (i) of clause (a)
(c) To perform such other duties relating to seamen and merchant ships as are, from time
to time, committed to them by or under this Act.
(2) Where there is in existence at any port a seamen's employment office, then,
notwithstanding anything to the contrary contender in any other provision of this Act, no
person shall receive or accept to be entered on board any ship of the class prescribed
under sub-section (1) any seamen of the categories prescribed under that sub-section,
unless such seaman has been supplied by such seamen's employment office.
(3) The Central Government may make rules for the purpose of enabling seamen's
employment offices effectively to exercise their powers under this Act; and in particular
and, without prejudice to the generality of such power, such rules may provide for(a) Consultation with respect to any specified matter by seamen's employment offices
with such advisory boards or other authorities as the Central Government may think fit to
constitute or specify in this behalf;
(b) The levy and collection of such fees as may be specified for any seamen's
employment office for registering the name of any seaman in any register maintained by
it
(c) The issue of directions by the Central Government to any seamen's employment office
with reference to the exercise of any of its powers;
(d) The suppression of any seamen's employment office, which fails to comply with any
such direction.
Amendment of section 95
In section 95 of the principal Act,
(i) In sub-section (1), for clauses (a) and (b), the following clauses shall be substituted,
namely: (a) To issue licence, to regulate and control the recruitment and placement service, and
to
(i) Ensure that no fees or other charges for recruitment or placement of seafarers are
borne directly or indirectly or in whole or in part, by the seafarers
(ii) Ensure that adequate machinery and procedures exist for the investigation, if
necessary, of complaints concerning the activities of recruitment and placement services;
and
(iii) To maintain registers of seamen in respect of the categories of seamen.
(ii) Sub-section (2) shall be omitted
(iii) In sub-section (3), for clauses (b) and (c), the following clauses shall be substituted,
namely:
(b) The levy and collection of such fees as may be specified for the issue of licences to
recruitment and placement services, renewal of such licences and services to be rendered
by the seamens employment office;
(c) The issue of directions by the Central Government to any seamens employment
office or any recruitment and placement service with reference to the exercise of any of
its powers; ;
(ca) the conditions under which the recruitment and placement service to recruit and
place seafarers abroad;
(cb) circumstances and conditions under which licence to be suspended or withdrawn;
(cc) conditions under which seafarers personal data to be processed by the recruitment
and placement services including the collection, storage, combination and
communication of such data to third parties;
(iv) After sub-section (3), the following Explanation shall be inserted, namely:-Explanation
For the purposes of this section:
(a) recruitment and placement service means any person, company, institution, agency
or other organisation, in the public or private sector, which is engaged in recruiting
seafarers on behalf of employers or placing seafarers with employers;
(b) seafarer means any person who fulfils the conditions to be employed or engaged in
any capacity on board a sea-going ship other than a government ship used for military or
non-commercial purposes.
97. Receipt of remuneration from seamen for shipping them prohibited. A person shall not demand or receive, either directly or indirectly, from any seaman, or
from any person seeking employment as a seaman, or from any person on his behalf, any
remuneration whatever for providing him with employment, other than the fees
authorized by this Act.
Substitution of new section for section 97
Receipt of remuneration, donation, fees, etc., from seamen for shipping them prohibited
For section 97 of the principal Act, the following section shall be substituted, namely:
as
or
of
of
6. After section 97 of the principal Act, the following section shall be inserted, namely:-.
Insertion of new section 97A
Prohibition against discrimination
97A. There shall be no discrimination between seamen:
(a) on the ground of their membership or lack of membership in any particular union
purporting to represent the interests of seamen and membership in such union shall not be
pre-requisite condition;
(b) on the basis of training institute from where they obtained training or place of issue of
their continuous discharge certificates,
for their recruitment and engagement on board any ship
Duration of certificates
(1) A safety equipment certificate, a qualified safety equipment certificate, an equipment
certificate and a qualified equipment certificate issued under this Part shall be in force for
twenty-four months from the date of its issue or for such shorter period as may be
specified in the certificate.
(2) Any certificate issued under this Part not specified in sub-section
(1) shall be in force for twelve months from the date f its issue or for such shorter period
as may be specified in the certificate.
(3) The Central Government or any person authorised by it in this behalf may grant an
extension of any certificate issued under this Part in respect of an Indian ship for a period
not exceeding one month from the date when the certificate would but for the extension
have expired, or if the ship is absent from India on that date, for a period not exceeding
five months from that date.
(4) Notwithstanding anything contained in this section a certificate issued under this Part
shall not remain in force after notice is given by the authority issuing the certificate to the
owner or master of the ship in respect of which it has between issued that that authority
has cancelled the certificate.
Substitution of new section for section 303
Duration of certificates
For section 303 of the principal Act, the following section shall be substituted, namely:
303. (1) A passengers ship safety certificate, a qualified passenger ship safety certificate,
a special trade passenger ship safety certificate and a special trade passenger ship space
certificate issued under this Part shall be in force for a period of twelve months from the
date of its issue or for such shorter period as may be specified in the certificate.
(2) A cargo ship safety equipment certificate, a qualified cargo ship safety equipment
certificate, a cargo ship equipment certificate, a qualified cargo ship equipment
certificate, a cargo ship safety construction certificate, a qualified cargo ship safety
construction certificate, a cargo ship construction certificate, a qualified cargo ship
construction certificate, a cargo ship safety radio certificate, a qualified cargo ship safety
radio certificate and a cargo ship radio certificate issued under this Part shall be in force
for a period of five years from the date of its issue or for such shorter period as may be
specified in the certificate.
Chapter 2 Documentation
Chapter 2 Documentation
CERTIFICATES AND DOCUMENTS REQUIRED TO BE CARRIED
ON BOARD SHIPS
(Note: All certificates to be carried on board must be originals)
Exemption Certificate2
SOLAS 1974, regulation I/12; 1988 SOLAS Protocol, regulation I/12
2)
2)
3)
Exemption Certificate
SOLAS 1974, regulation I/12; 1988 SOLAS Protocol, regulation I/12
In such a case, the ship should inform port control 12 hrs prior arrival or 4 hrs prior
E.T.A., if not possible then on arrival.
Arrival procedure (documents)
International health regulations WHO
International health organisation regulates port health procedures. Most countries
implement these in national regulations.
Health clearance is called a free pratique. It literally means permission to
disembark and commence cargo operations. Health clearance is required if there
has been on board during the previous 28 days any of the occurrences which the
master is required to report.
If no such occurrences are there then the Port health officer will generally give
free pratique.
Also under this regulation every ship must carry a de-ratting or de-ratting
exemption certificate as appropriate.
These certificates are issued by the port health authority and are valid for 6
months.
A de-ratting certificate states that any ship must either be:
9 Periodically kept free of rodents or
9 Periodically de-ratted
General declaration
Cargo declaration
On arrival:
On departure
Crew list:
To know the number and composition of the crew on arrival and departure
Name and nationality of the ship
Family name
Given names
Nationality
Rank or rating
Date of place of birth
Nature and number of identity document
Port and date of arrival
Arriving from.
Passengers list:
Stowaways present numerous headaches, delays, and are very expensive. The company
must bear all expenses of repatriation. Ship's officers may face termination if it is felt
they have failed to exercise due diligence. Lest anyone regard this as a trivial matter, one
American flag liner company estimated the cost of handling five European stowaways to
be in the neighbourhood of $100,000 US dollars.
The Prevention and Care of Stowaways
Recent media coverage of the trials of seamen accused of brutal treatment and murder of
stowaways has brought their plight to the world's attention, but the problem has been
growing steadily for many years. The proliferation of satellite dishes in impoverished
countries showing the good life in America, combined with population pressure,
collapsing economies, and political repression, has sparked a dramatic increase in
stowaway activity, and some panicky responses from shipmaster and crew.
Few people in America realize that income received from relatives in the United States
constitutes the single largest contribution to the national income of several nations,
including Haiti and the Dominican Republic.
One alarming trend has been the increase in the number of stowaways on a given vessel.
Traditionally the stowaway was a lonely, desperate man, but now groups--including
women and children-- are being found. This trend reflects the fact that stowing away on a
merchant vessel is usually a group effort resulting from shared know-how, bribery,
collusion, and hard work. The advance guards of the stowaways are the prostitutes,
stevedores, guards, chandlers, customs official and fake-jewellery salesmen who flock
onboard.
The master of a vessel trading in high-risk countries, such as Haiti, The Dominican
Republic (the worst), Colombia, or Nicaragua must hold training sessions for the officers
and crew regarding non-crew members in unauthorized areas, the securing of hatches, the
maintenance of effective look-outs, the use of disinformation to discourage stowaways,
and proper stowaway search procedures before departure.
Other techniques for preventing or flushing out stowaways include wireless alarms
sounding in the master's stateroom when certain hatches or doors are opened, the use of
Spanish-language placards warning that certain compartments contain poisonous gases,
and the use of tear gas to flush out stowaways.
One aspect of the stowaway problem that has eluded the media is the reality that many
stowaways are criminals in their countries, fleeing legitimate prosecution, and many
others exhibit the violence of desperation. The vessel trading high-risk countries should
maintain a brig onboard to hold stowaways, and the handling of apprehended stowaways
should be rigidly supervised and recorded.
The greatest threat from stowaways is not their physical presence, but the grievous
consequences of their presence. Fines, delays, emotional stress, and even criminal
charges against the crew for mistreating stowaways face ship owners who do not
implement an effective plan to prevent stowaways from coming onboard and to care for
the ones that do.
Preparedness to Deal with Stowaways: Security Contingency Plans
The principle of 'building block' will be used, covering subjects individually, which when
taken as a whole, will produce a complete plan.
Specific Subject Areas:
1. INITIAL RISK ASSESSMENT - The stages and thinking involved in the conduct of
an initial detailed risk assessment
2. THE LEGAL SITUATION - Covering in outline the requirement to consider the
impact of any security measures on the local laws and the legal implications.
3. SECURITY SURVEY - The next stage is a detailed survey using the findings of the
Risk Assessment as its baseline. This will include the conduct of a survey, the subject
areas covered and the preparation of a report, including conclusions and
recommendations.
4. THE PRINCIPLE OF LAYERED PROTECTIVE MEASURES - Why the principle of
building layers of protection is the fundamental feature of a totally integrated system and
that this principle can equally be applied to cargo and passenger handling facilities.
5. PERIMETER PROTECTION INCLUDING DESIGNATED RESTRICTED AREAS Detailing the absolute requirements for the use of visible perimeter fences, boundaries
and the correct designation of the areas to be protected, using control of access and
designated Restricted Areas.
6. CONTROL OF ACCESS - Covering the need for the control of access to facilities and
specific areas and how these controls can be efficiently and sensibly implemented,
without disrupting the commercial function of the vessel.
7. TECHNICAL MEASURES - The use of technical measures in support of the
protection of the vessel.
8. SECURITY PERSONNEL - The selection, recruitment, training and utilization of
personnel.
9. IDENTIFICATION - The identification of employees and visitors covering cargo and
non-cargo facilities.
Additional expenses for shore watchmen and human occupancy detector are not
covered by P & I club.
Charterer responsibility:
To exercise due care and diligence in preventing stowaway gaining access to v/l by
means of secreting himself in goods or container shipped by charterer.
If stowaway is found thru container or goods, this will constitute a breach of charter, for
which he shall be liable and holds s/o harmless and indemnify against all claims, which
may arise and made against them.
Stowaway searches:
1.
2.
3.
4.
5.
6.
7.
8.
A case study shows that three stowaway found onboard and been thrown
overboard, two of them swim ashore safety and one drowned
After legal proceeding master and chief officer were given life sentences and
other crew were jailed up to 20 years
Full name
Nationality
Postal and residential permanent or last address
Date and place of birth
Name, date and place of birth of either or both parents or other next of kin
including their postal and residential address
Details of any document found in stowaways possession, such as passport, CDC
or identity card
Stowaway not be socialize and become friendly with crew
Never allow stowaway to escape in port as ship's officer(s) may be fined by
immigration
Do not allow stowaway on work
Proper logbook entries made for the period of stay of stowaway
In the FAL Convention, standards are internationally agreed measures, which are
"necessary and practicable in order to facilitate international maritime traffic" and
recommended practices as measures the application of which is "desirable".
The standards and recommended practices for stowaways reflect the Guidelines on the
Allocation of Responsibilities to Seek the Successful Resolution of Stowaway Cases
(Resolution A.871 (20)), adopted in 1997, which established basic principles to be
applied in dealing with stowaways.
The guidelines in the resolution state that the resolution of stowaway cases is difficult
because of different national legislation in the various countries involved. Nevertheless,
some basic principles can be applied generally.
Stowaways entering a country without the required documents are, in general, illegal
immigrants, and decisions on how to deal with such situations are the prerogative of the
countries concerned. Stowaway asylum seekers should be treated in compliance with
international protection principles set out in relevant treaties.
The guidelines advocate close co-operation between ship-owners and port authorities.
Where national legislation permits, national authorities should consider prosecuting
stowaways concerning any damage caused. Countries should permit the return of
stowaways who are identified as being their citizens or who have a right of residence,
while the country where a stowaway originally embarked should normally accept his or
her return pending final case disposition.
The guidelines say that every effort should be made to avoid situations where a stowaway
has to be detained on board a ship indefinitely.
The guidelines then go on to establish in greater detail the responsibilities of the master,
of the ship-owner or operator, of the country of the first scheduled port of call after the
discovery of the stowaway (the port of disembarkation), of the country where the
stowaway first boarded the ship, of the stowaway's apparent or claimed country of
nationality, of the flag State of the vessel, and of any countries of transit during
repatriation.
The Assembly resolution refers to the difficulties encountered by masters and owners in
disembarking stowaways from ships. It emphasizes the need for co-operation and states
that "in normal circumstances, through such co-operation stowaways should, as soon as
practicable, be removed from the ship and returned to the country of nationalitycitizenship or to the port of embarkation, or to any other country which would accept the
stowaway."
The resolution also requested the Facilitation Committee to monitor the effectiveness of
the Guidelines; to keep them under review; and to take such further action, including the
development of a binding instrument, as may be considered necessary.
Common Solution
Restrict / control access to the port / cargo / vessel
How?
Maritime carriers on their own can only do so much. Port authorities are involved.
Governments are involved.
Contingency planning
Allocation of security responsibility - operator / vessel
Awareness of threats
Give guidance - (e.g.: industry guides on drugs and piracy - company guidance)
Increase port security and not rely solely on the vessel protecting its perimeter
For their ability to anticipate accurately the effects of currents and tidal influences
For their expertise in navigating in close proximity to land and in narrow channels
For their understanding of local traffic
For their ability to work effectively with the local VTS
For their language ability when dealing with shore services
For their expertise in handling tugs and linesmen
To support the master and to relieve fatigue
To provide an extra person or persons on the bridge to assist with navigating the
ship
The question as to whether or not a pilots primary role is to Improve safety is difficult to
answer since there are no a shipmaster may be more cautious. Without a pilot the
shipmaster may be more prone to make an error of judgement at a critical point of
approach. The feeling of the group was that the influence of a pilot on board improves
both the safety and efficiency of the operation.
Duty of the Master and Crew during Pilotage
The master of a ship must amongst other thing ensure the safety of the ship, of all on
board and of all who are threatened in any way by the proximity or operations of other
ships. In the execution of his duties, he is entitled to the full co-operation and assistance
from his officers and other members of his crew. All on board must go about their tasks
in accordance with those ordinary practices of seamen that have been tried and tested
over a long period of time i.e. the well understood standards of seamanship that safeguard
against accident or error. It is the masters responsibility to ensure that the crew support
the pilot in his duties and the master may delegate the authority for this to the officer of
the watch or other appropriate officers.
It is the responsibility of the master, officers and other members of the crew to pass on all
relevant information, including defects and peculiarities, to the pilot and to keep a proper
lookout. The duty has been interpreted by the courts to include the duty to report all
material circumstances and facts which might influence the pilots actions, even if the
pilot is in a position where he ought to be able to see things clearly for himself.
Where, in the masters opinion, the situation developing is obviously dangerous, it is his
duty to draw the pilots attention to the risk and, if necessary in his judgment, take over
the conduct of the vessel. The master is not justified in doing nothing.
The duty in of the pilot is to direct the navigation of the ship, and to conduct it so far as
the course of the ship is concerned. He has no other power on board. The common law
relationship between master and pilot is such that, when the latter is legally responsible
for his own actions and the is restricted to circumstances where there is clear evidence of
the pilots incurring his own liability, is restricted to circumstances where incurring his
own liability, is restricted to circumstances where there is clear evidence of the pilots
inability or incompetence.
The legal position of the pilot on board a vessel is aptly summarised by the Canadian
Royal Commission on Pilotage, Ottawa 1968, as follow:
To conduct a ship must not be confused with being in command of a ship.
The first expression refers to action, to a personal service being performed; the second to
power. The question whether a pilot has control of navigation is a question of fact and not
of law. The fact that a pilot has been given control of the ship for navigational purposes
does not mean that the pilot has superseded the master. The master is, and remains, in
command; he is the authority to subordinates and to outside, delegate part of his authority
to subordinates and to outside assistants whom he employs to navigate his ship i.e. pilots.
A delegation of power is not an abandonment of authority, but one way of exercising
authority.
However, laws of most foreign countries provide that a pilot whose employment is
compulsory is not regarded as having control of navigation of ship, but has his duties
restricted to advising the master of local conditions affecting safe navigation.
Voluntary and Compulsory Pilots
The pilot must, of course, possess many of the mariners skills including knowledge of
the Rules of the Road, navigation, and the use of all forms of navigation equipment. A
clear distinction must be made between voluntary and compulsory pilots.
A voluntary pilot is one engaged for the convenience of the vessel. A North Sea pilot
employed to take a ship between the Rotterdam and Bremerhaven sea buys would be one
example of a voluntary pilot. No statue requires a ship to have a pilot aboard but the
master or owner hires the pilot to aid in making the passage expeditiously.
The owner, through the master, has great control over the voluntary pilot. The pilot need
not be hired in the first place, or the pilots services can be rejected during the passage
and the vessel continues to her destination. The voluntary pilot is in a significantly
different position aboard ship than the compulsory pilot, practically speaking the master
can feel much freer to advise or relieve a voluntary pilot the voluntary pilot is in much
the same position as the ships mates.
A compulsory pilot, on the other hand, is one that is required by law to be aboard while
the ship is navigating certain specified areas. Penalties such as fines or imprisonment, or
both, are the hallmarks of compulsory Pilotage laws. If a ship is allowed by hallmarks of
compulsory services of a pilot provided she pays a portion of the Pilotage fee and the
Pilotage is not compulsory.
The relationship between master and compulsory pilot is in many ways unique in that it is
usually defined by custom, practice, and statute rather than contract. While the pilot is
generally neither an employee of the ship nor a member of her crew, he is ultimately
subordinate to the member of her crew, he is ultimately subordinate to the master,
although the degree of subordination is less than popularly perceived. The public and the
industry benefit equally from this working arrangement and from the degree of
overlapping responsibility that compels both pilot and master to be concerned about a
vessels safety.
The compulsory pilot is not aboard in a purely advisory capacity. That pilot is in charge
of the navigation of the ship while aboard and the ships crew is required to obey the
compulsory pilots orders relating to navigation unless the master determines it is
necessary to intercede for reasons yet to be discussed. A compulsory pilot is responsible
for his own actions and receives a significant fee because of this responsibility. In the
presence of the compulsory pilot, a masters responsibility is not total and forever. Both
master and pilot have a job to do and bear an unusual degree of responsibility not only to
the vessel, cargo, and crew, but also the public.
An exception is found to the traditional master/ pilot relationship at the Panama Canal.
The Panama Canal Commission accepts a greater degree of liability in exchange for
greater control of ships navigation in that strategic waterway. Inside the locks of the
Panama Canal, Commission is liable for payment for injuries to the vessel, cargo, crew,
or passengers arising out of a passage through unless the Commission shows that the
injury was caused by a negligent act of the vessel. Outside the locks the Commission
passengers when such injuries are proximately caused by the negligence or fault of a
Canal Commission employee provided that in the case of a ship required to have a
Panama Canal pilot on duty on duty. Damages are only payable if at the time of injury the
navigation was under the control of the Panama Canal pilot.
Shipmasters should be aware of the manner in which the traditional master/ pilot
relationship is distorted in the special circumstance.
THE MASTER/PILOT RELATIONSHIP
...Perhaps attitudes must change. Things have come a long way in this industry, but
cooperation is still lacking between bridge officers, masters and pilots. --- A master
Some masters just want to be masters, smirk at advice, and treat you as an intruder. --- A
Pilot
Has the pilot been informed of the location of lifesaving appliances provided for
his use?
Have the proposed passage plan, weather conditions, berthing arrangements, use
of tugs and other external facilities been explained by the pilot and agreed with
the master?
Are the progress of the ship and the execution of orders being monitored by the
master and the officer of the watch?
One Canadian pilot has summed up the requirement for an exchange of technical
information as follows:
Pilots should be informed of each significant factor, which may affect his proposed
manoeuvring plan. Vessel manoeuvring characteristics should be shown to the pilot and
he should ensure he understands any special conditions, which may affect him. He should
always know who the senior officer of the bridge party is, including the master and be
aware of watch changes, quartermaster changes etc. Similarly the pilot must inform the
master of his intended manoeuvring plan and update this as necessary with any change in
conditions. Local regulations and communications requirements should be relayed to the
master and officer of the watch.
The Masters Responsibilities in Pilotage Waters
The master retains overall responsibility for the vessel and her operation, for having a
competent watch on duty and seeing that they perform their work efficiently, for being
sure a proper lookout is maintained, and for compliance with all regulations and statues
including the Rule of the Road (COLREGS). The masters authority is never completely
in abeyance even while a pilot (compulsory or not) has immediate charge of the ships
navigation. The master is also responsible for his own professional competency,
including having sufficient knowledge and experience to be able to judge the pilot s
performance and recognize significant pilot error, and to have studied and the local
waters and be able to recognize known and published dangers.
The master has a duty to advise or relieve a pilot in cases of:
Intoxication
Gross incompetence to perform the task at hand
When the vessel is standing into danger that is not obvious to the pilot
When the pilots actions are in error due to a lack of appreciation of particular
circumstances, including the limitations of the particular ship being handled
In carrying out these responsibility the master may either advise or relieve the pilot, at the
masters discretion, in practice, there is a real burden upon the master to justify relieving
the pilot should some casualty result so the action of relieving must not be arbitrary, there
are several ways to do a job and, while admittedly some are more expeditious than others,
the master must not relieve the pilot simply should only be relieved when the master
feels, based upon professional experience and training, that the vessel, crew, or cargo is
being placed in real and imminent danger because of that pilot s present course of action.
On the other hand, the master is negligent if action is not taken when required. The
master first objects to an action, then recommends an alternative and only in the rare case
when the pilot refuses to accept a recommendation does the master relieve a pilot in a
timely manner while it is still possible to avoid an accident.
The decision about when to become involved is more difficult than the absolute problem
of whether it is necessary to do so. There is a natural reluctance to act because of the
ramifications in case of a casualty, yet the question of the timing is most critical, Relief
usually occurs when it is too late- when the situation has deteriorated so far that even the
most competent ship handler could not correct matters and the masters efforts then only
complicate an already bad situation. There is no equipment that a ship be in extremis
before the pilot is relieved, only that the master foresees danger should a present course
of action continue.
It is imperative that the master be sufficiently skilled in ship handling to recognize a
problem early, and have sufficient confidence in those skills to take prompt and decisive
action if it is necessary to relieve a pilot. The correctness of action taken reflects the
training and experience that a master has had and it is too late to compensate for years of
neglect in this area at such a time. The decision to relieve a pilot is not an easy one, but a
master who instead stands by as the vessel heads for certain catastrophe remains a
responsibility party ad must take action. It is a judgment that can only be made based on
professional experience and is but one example of why the title shipmaster bears a
connotation of unusual responsibility.
Release from liability forms
Occasionally a master is presented with a form to be signed releasing the pilot from
liability. These forms may be based on local practice or special circumstances such as a
tugboat strike. The validity of these forms in a particular case is questionable and
depends on local laws and regulations of which the master cannot reasonably be expected
to have knowledge.
In as much as the master may be under pressure not to delay the vessel, and may not be
able to consult with anyone about the advisability of signature that the release is Signed
under protest so that the vessel may proceed. An entry to that effect should be made in
the ships log. Forward a copy of the release to the owners so they can advise you about
signing such documents in the future.
In any case, the form will have no immediate practical effect since the master has
ultimate responsibility for the ship in any case, and the document in no way alters the
masters conduct during the docking or other working at hand.
Case study
On 05 August 1990, after un-berthing in the Port of Montreal and attempting to turn the
vessel to head downstream, the chemical tanker "LAKE ANINA" grounded outside the
channel over a pipeline buried in the river bed. The inquiry determined that, while in a
compulsory Pilotage area with a pilot on board, the master retained the conduct of the
vessel. The master believed that he was better suited to carry out the manoeuvre because
of his familiarity with the vessel, and he was counting on the pilot's advice during the
manoeuvre. However, the master and the pilot had different ideas as to the helm and
engine actions required to effect the turn. In this case, the master's ideas prevailed. The
type and degree of support and advice to be given by the pilot were not determined in
advance.
An exchange of all relevant information and the intended transfer of the conduct of the
vessel should also be established and agreed upon as soon as possible. Hand-over
briefings are an essential component of teamwork and cooperation. However, here again,
there is a different perception between pilots and master / bridge officers on the conduct
of hand-over briefings.
Radio Communications
It is the responsibility of the Master to ensure that all communications relating to the
navigation and safety of the ship are conveyed to the master / OOW.
Language
The only practical way to improve operation relationship is to improve communication
between pilots-masters-officers of the watch. This can be by one common language
internationally.... As standards of crewing have yet to see a real positive improvement,
this problem will be ongoing until the shipping world exhausts the search of nations
forever cheaper crews. With the introduction of a new nation/language, the
communication problem exists with these new conscripts for three to five years until they
have attained a reasonable level of language expertise, they then become more expensive
and so the cycle continues. --- A pilot
An increasing number of foreign vessels plying Canadian waters are reported by pilots as
having no one on board who can speak English or French. In fact, since 1975, there have
been at least 24 marine occurrences involving foreign-flag vessels in Canadian waters
where an inadequate knowledge of the operating language was identified as a
contributing factor.
In a study conducted by Transport Canada, when pilots were asked whether language
barriers make it difficult to communicate orders to the helmsman on foreign-registered
vessels, some 60% replied that language barriers "sometimes" affect communication with
the helmsman while 20% reported that it "often" resulted in difficulty in communicating.
An IMO Maritime Safety Committee (MSC) memorandum on the "Role of the Human
Element in Maritime Casualties", submitted by the government of the Bahamas, states:
It should be noted that in the Act, if the crew have insufficient knowledge of English and
do not have a common language, the ship shall be deemed un-seaworthy and shall not
proceed to sea.
Teamwork
On foreign-registered ships... I have had several incidents when the Captain gave the
helmsman different orders than I gave him. I can tell by the rudder indicator. (In other
words he is second-guessing my judgement.) Over the last 23 years, this has nearly
caused some collisions and grounding. Also with a variable pitch propeller I have had
different orders relayed for engine movement while manoeuvring the ship. Again secondguessing my judgement/ability - a very dangerous action - creating confusion on the
bridge. On several occasions the master has said it was "Pilot error" - not so in my case now I carry a tape-recorder to protect myself. --- A pilot
Ineffective communications on the bridge, interrupted procedures, lack of situational
awareness, lack of teamwork between pilots and ship officers, etc. have been contributory
factors in several similar occurrences in recent years. For instance, the following extracts
from Transport Canada reports are representative of occurrences in which there were
serious lapses in teamwork among the bridge officers:
A general lack of interaction, coordination, and cooperation among the master, the
officer of the watch and the pilot was evidenced.... There was no effective exchange of
navigational and operational information among the different crewmembers and the pilot
when they came onto the bridge around midnight. Both the pilot and the second mate did
their own calculations of the vessel's position, but they did not exchange information....
Because he did not know what the pilot's intentions were, the second mate did not
question him
It should be noted that teamwork is as important as technical proficiency for safe
navigation.
Master / Pilot Information Exchange
Pilot supplied by Master with relevant ship-handling information (draught, trim,
turning circles, peculiar manoeuvring characteristics in restricted water depth/
channel width and other data). This information may be displayed at the conning
position
Proposed track, plan, alternative plan, and available anchor berths along route
explained by pilots charts. With Master, Charts compared with the pilots charts
If required, appropriate Master/ Pilot information exchange from may be used
Safe progress of the ship in relation to agreed track and plan monitored by Master
and Officer of the Watch and the execution of orders checked
Berthing/ un-berthing plan, including the availability and use of tugs and other
external facilities agreed by pilot and Master
Tide, set, wind force and direction, visibility expected along route
Pilot informed of position of life-saving appliances provided for his use
Check List of Items to be agreed between the Master and the Pilot
1.
2.
9
9
9
9
9
9
9
9
9
9
9
9
9
9
9
3.
9
9
9
9
Amidships
Yes No
Critical RPM ___________
Full speed
Half Speed
Slow
Dead Slow
Knots
knots
knots
knots
Revolutions
Revolutions
Revolutions
Revolutions
Maximum astern revolutions ____________________________ minutes.
It necessary to exceed manoeuvring full ahead allow _________________
Minutes for slowing down
Sea speed loaded: __________ Sea speed Ballast: ___________________
Present state of M.E/ Telegraphs: __________________________________
Ship Handling information and peculiarities of ship.
Navigation Aids
Date ________
In the 273 occurrences examined, misunderstanding between the pilot and master,
inattention by the pilot or the OOW, or lack of communication between the pilot
and the OOW were frequently present.
The vast majority of responding masters, bridge officers and pilots believe that
teamwork is as important as technical proficiency for safe navigation.
Recent occurrences indicate continuing problems with respect to the adequacy of
bridge teamwork; e.g. lack of a mutually agreed passage plan, lack of interaction,
coordination and cooperation among the bridge team, lack of precise progressmonitoring by the OOW, etc.
Fundamental differences in the corporate perspectives of ship officers and pilots
on such issues as the need for compulsory Pilotage and limited pilots' legal
liability are not conducive to promoting harmony in bridge teamwork.
Although most pilots, masters and OOW agree that improving communications
among bridge personnel is key to safe marine operations, a significant proportion
of masters and bridge officers reported reluctance to question a pilot's decisions.
Often, there are differences in perceptions between masters / OOW and pilots
regarding the need for the exchange of information and the adequacy of the
information being exchanged.
Most masters and bridge officers who responded state that they always inform the
pilot of the manoeuvring characteristics of the vessel, but few pilots state that they
are always provided with the information.
The majority of masters and bridge officers feel that pilots do not always provide
adequate timely information on local conditions.
Many masters and bridge officers reported that pilots do not always provide
information to the master or the OOW regarding the passage plan.
Pilots and masters also disagree over the adequacy of hand-over briefings; most
masters / OOW say that they are informative and most pilots say that they are not.
Many masters and OOW believe that pilots do not always convey information
essential to safe navigation which is received by radio communications.
With respect to the overall exchange of information between pilots and masters
and OOW, apparently each party is under the assumption that the other knows the
necessary information and, if they do not, they will request it.
Misperceptions that the other party knows about the manoeuvring characteristics
of the vessel, or the local conditions and the intended passage plan can lead to
significant misunderstandings and surprises for the bridge team.
The master and the pilot should exchange information regarding navigational
procedures, local conditions and rules and the ships characteristics. This
information exchange should be a continuous process that generally continues for
the duration of the Pilotage
Each Pilotage assignment should begin with an information exchange between the
pilot and the master. The amount and subject matter of the information to be
exchanged should be determined by the specific navigation demands of the Pilotage
operation. Additional information can be exchanged as the operation proceeds
practice, taking into account regulatory requirements and best practices in the
Pilotage area
Pilots should consider using an information card, form, checklist or other memory
aid to ensure that essential exchange items are covered. If an information card or
standard form is used by pilots locally regarding the anticipated passage, the layout
of such a card or form should be easy to understand. The card or form should
supplement and assist, not substitute for, the verbal information exchange
General agreement on plans and procedures, including contingency plans, for the
anticipated passage
Pilots and competent Pilotage authorities should be aware of the voyage planning
responsibilities of masters under applicable IMO instruments
Communications language
Pilots should be familiar with the IMO Standard Marine Communication Phrases
and use
them in appropriate situations during radio communications as well as during
verbal exchanges on the bridge. This will enable the master and officer in charge of
the navigational watch to better understand the communications and their intent.
Communications on board between the pilot and bridge watch keeping personnel
should
be conducted in the English language or in a language other than English that is
common to all those involved in the operation.
When a pilot is communicating to parties external to the ship, such as vessel traffic
services, tugs or linesmen and the pilot is unable to communicate in the English
language or a language that can be understood on the bridge, the pilot should, as
soon as practicable, explain what was said to enable the bridge personnel to
monitor any subsequent actions taken by those external parties.
Reporting of incidents and accidents
When performing Pilotage duties, the pilot should report or cause to be reported to
the appropriate authority, anything observed that may affect safety of navigation or
pollution
what it produces and acquiring what it lacks: none can be dependent only on its domestic
resources.
Shipping has always provided the only really cost-effective method of bulk transport over
any great distance, and the development of shipping and the establishment of a global
system of trade have moved forward together, hand-in-hand. Those with access to natural
resources; those with the ability to convert those resources into useful products for the
good of mankind; and those with a requirement and the wherewithal to utilize and
consume those end products are all joined by the common thread of shipping. The eternal
triangle of producers, manufacturers and markets are brought together through shipping.
This has always been the case and will remain more so for the foreseeable future.
Shipping and the global economy
More than 90 per cent of global trade is carried by sea. It is almost impossible to quantify
the value of volume of world sea-borne trade in monetary terms: however, the United
Nations Conference on Trade and Development (UNCTAD) estimates that the operation
of merchant ships contributes about US$380 billion in freight rates within the global
economy, equivalent to about 5% of total world trade.
Shipping trade estimates are usually calculated in tonne-miles a measurement of tonnes
carried, multiplied by the distance travelled. In 2003, for example, the industry shipped
around 6.1 thousand million tonnes over a distance of about 4 million miles, resulting in a
staggering total of over 25 thousand billion tonne-miles of trade.
Throughout the last century the shipping industry has seen a general trend of increases in
total trade volume. Increasing industrialization and the liberalization of national
economies have fuelled free trade and a growing demand for consumer products.
Advances in technology have also made shipping an increasingly efficient and swift
method of transport. Over the last four decades, total sea-borne trade estimates have more
than quadrupled, from less than 6 thousand billion tonne-miles in 1965 to the latest
full-year figure of 25 thousand billion tonne-miles in 2003.
As with all industrial sectors, however, shipping is not immune to occasional economic
downturns a notable fall in trade occurred, for example, during the worldwide
economic recession of the early 1980s. However, although the growth in sea-borne trade
was tempered by the Asian financial crisis of the late 1990s, there has generally been
healthy growth in maritime trade since 1993. Overall, between 1980 and 1999, the value
of world trade grew at 12% per year, while total freight costs, during the same period,
increased by only 7%, demonstrating the falling unit costs of marine transportation.
The transport cost element in the shelf price of consumer goods varies from product to
product, but is ultimately marginal. For example, transport costs account for only around
2% of the shelf price of a television set and only around 1.2% of a kilo of coffee.
Shipping is truly the lynchpin of the global economy. Without shipping, intercontinental
trade, the bulk transport of raw materials and the import/export of affordable food and
manufactured goods would simply not be possible. Todays world fleet is registered in
over 150 nations and is manned by over a million seafarers of virtually every nationality.
In the context of a global economy, the contribution made by shipping as a major
industry in its own right is very significant, and increasingly so for the developing world.
Maritime activity already provides an important source of income to many developing
countries. Indeed, developing countries now lead the world in some of shippings most
important ancillary businesses, including the registration of ships, the supply of sea-going
manpower and ship recycling. They also play a significant part in ship-owning and
operating, shipbuilding and repair and port services, among others.
General structure of shipping industry
The history of shipping is a glorious and proud one. There is no doubt, for example, that
the magnificent square riggers of the era of sail or the early 20th centurys prestigious
ocean liners could stir the hearts of all those that beheld them. But the ships of today are
just as worthy of our admiration, for shipping today is in another truly golden age. Ships
have never been so technically advanced, never been so sophisticated, never been more
immense, never carried so much cargo, never been safer and never been so
environmentally-friendly as they are today.
Mammoth containerships nudging the 10,000 TEU barrier yet still capable of 25 knot
operating speeds; huge oil tankers and bulk carriers that carry vast quantities of fuel,
minerals, and grain and other commodities around our planet economically, safely and
cleanly; the complex and highly specialized workhorses of the offshore industry; and the
wonderful giants of the passenger ship world are all worthy of our greatest admiration.
In shipping today we can see many marvels of state-of-the-art engineering and
technology that deserve to be ranked alongside the very finest achievements of our global
infrastructure. We all marvel at the wonders of the modern world skyscrapers, bridges,
dams, ship canals, tunnels and so on. Although they all deserve our admiration, there
should be no question that todays finest ships are also worthy of the sort of recognition
usually reserved for the great icons of land-based civil engineering with one substantial
difference in favour of the former: while skyscrapers, bridges, dams et al are static
structures designed to withstand the elements coming to them, the very essence of marine
vehicles sends them out to sea to face the elements at full force, alone in the vastness of
the ocean. They should, therefore, be robust when built and maintained as such
throughout their entire lifetime.
Ships are high value assets, with the larger of them costing over US $100 million to
build. They are also technically sophisticated: you are more likely to find one of todays
modern vessels being controlled by a single joystick and a mouse-ball in the arm of the
helmsmans seat than by a horny-handed bosun grappling with a spiked wheel; the chief
engineer will probably have clean hands and the calluses on his or her fingers will be
from tapping a keyboard rather than wielding a spanner. The crew accommodation will
be clean, light and airy with modern recreation facilities; the food will be good; and you
may well find the first officer exchanging emails with his family at home via the satellite
communication system. Ships today are modern, technologically advanced workplaces
and the work of IMO has played, and continues to play, an important part in shaping that
environment.
As at 1 January 2005, the world trading fleet was made up of 46,222 ships, with a
combined tonnage of 597,709,000 gross tonnes. The vast bulk of the fleet was made up
of: general cargo ships (18,150), tankers (11,356), bulk carriers (6,139), passenger ships
(5,679) and containerships (3,165). Other ship types accounted for 1,733 vessels.
Although general cargo ships are still the largest single category, the trend among new
ships is more and more in favour of specialization (although it could be argued that
handy-sized, geared bulk carriers and versatile medium-sized containerships, of which
some have the ability to accommodate several different box sizes as well as palletised
cargo are the natural successors of the old general cargo vessels); indeed, it is interesting
to note that, in the most recent edition of the annual Significant Ships publication from
the United Kingdoms Royal Institution of Naval Architects, not a single one of the 50
selected for 2004 was a general cargo vessel. Tankers make up the second largest
category. There are many different types of tanker, ranging from those carrying crude oil,
through those built to transport various refined hydrocarbon products, to highly
specialized ships that carry liquefied petroleum gas and natural gas. There are even
tankers designed to carry cargoes such as fresh water, wine or orange juice. In size terms,
the heyday of the tanker was the early 1970s, when the so-called Ultra-Large Crude
Carriers (ULCC), capable of lifting more than half a million tonnes of cargo, bestrode the
oceans. After the oil crisis of the 70s, tanker owners became a little more modest in their
ambitions and, since then, most large modern tankers are in the 200-300,000 tonnage
range. These are still massive vessels and enormously expensive to build, but todays
high price of oil means they can pay for themselves in a relatively short period of time.
The worlds largest ship today is a 564,765 DWT tanker with an interesting and varied
history. She was built in 1976 and having undergone some work to increase her loadcarrying capacity, was finally floated two years later and named Seawise Giant. At first,
she operated in the Gulf of Mexico and the Caribbean Sea, but was then used for
exporting oil from Iran during the Iran-Iraq War. In 1986, she was attacked but not sunk
in the Strait of Hormuz and at the end of the war in 1989 she was repaired and renamed
Happy Giant. In 1991, she was renamed again, this time to Jahre Viking.
In March 2004, the ship was sold and sent by its new owner to be refitted as a floating
storage and offloading unit. There, she was given her current name, Knock Nevis, and
plans have been made to operate her in the Al Shaheen oilfield in the waters of Qatar.
Perhaps more typical of the kind of large crude oil carrier being built today is the Irene
SL, also built in Japan in 2004. Selected as one of the Naval Architects 50 Significant
Ships of 2004, Irene SL has a design deadweight of just under 300,000 DWT, a doublehull construction and is capable of handling three different grades of oil simultaneously
in her 15 cargo tanks. Her cargo and ballast control systems, including the operation of
pumps, valves and ullage measurement are all computerized. For safety, inert gas is
pumped into the cargo tanks when they are empty and, to comply with the most recent
requirements on emissions, the ship is fitted with a scrubber system to clean the exhaust
gas.
Bulk carriers are often called the workhorses of the international shipping fleet. They can
be thought of as simple, relatively unsophisticated but nevertheless highly efficient
vessels that typically transport commodities such as grain, coal and mineral ores. If
tankers provide the fuel that powers the modern economy, bulk carriers are responsible
for moving the raw materials that are its lifeblood.
In terms of size, the worlds bulk carrier fleet has three categories; ships of up to 50,000
DWT are known as handy-sized; ships of 50,000 to 80,000 DWT are known as
Panamax (being the largest ships able to transit the Panama Canal) and ships of more
than 80,000 DWT are known as capesize. Bulk carriers embrace a number of variations
single or double hull, with or without their own cargo-handling equipment but all are
characterized by the huge hatch covers that can be rolled or lifted away to reveal to
cavernous holds beneath.
Because of the nature of the cargoes they carry often heavy, high-density commodities
accidents involving bulk carriers have sometimes resulted in considerable loss of life.
For this reason IMO has, over a long period of time, undertaken a great deal of work to
improve the safety of this type of vessel. There is, for example, a special chapter on bulk
carrier safety in the Safety of Life at Sea Convention, covering such topics as damage
stability, structural strength, surveys and loading. In a casualty analysis undertaken
recently by the International Association of Dry Cargo Ship-owners INTERCARGO
for bulk carriers for the ten years to 2001 it revealed that the number of ships, lives and
tonnage being lost in this sector are all decreasing. Moreover, the report has specifically
identified that IMO measures such as the Enhanced Programme of Inspections during
Surveys and SOLAS chapter XII on bulk carrier safety, have reduced the risk of fatality
on new and existing ships by 50 % and 25 % respectively.
Passenger ships come next in the world fleet league table. There are two basic categories
which can be summed up as fun or function. In the latter category are those which
are designed to move people and, often, vehicles on regular itineraries from one place to
another as quickly and cheaply as possible (i.e. ferries) and, in the former, those which
the passengers see as a leisure destination in their own right (i.e. cruise ships). In both
categories, the size, sophistication and the sheer number of passengers that can be carried
have reached mind-boggling proportions. Because of their individuality, as well as their
resonance with the great ocean liners of a bygone era, these ships tend to be the best
known and most recognized among the general public at large. One of the finest modern
examples is the Queen Mary II, built in France for Carnival Corps Cunard in 2004. QM2
is the largest, longest, tallest, widest ocean liner ever and has cost an estimated $800
million dollars. She incorporates all the very latest international standards with regard to
judgements of the Court do not equate with the traditional understanding in the market.
The agreement of the parties, during Charter-party negotiations, to adopt those two
definitions of interpretation would override any common law judgement.
Definitions
Port: Means an area within which ships are loaded with and /or discharged of cargo and
includes the usual places where ships wait for their turn or are ordered or obliged to wait
for their turn no matter the distance from that area. If the work Port is not used, but the
port is (or is to be ) identified by its name, this definition shall still apply.
Safe port: Means a port which, during the relevant period of time, the ship can reach,
enter, remain at and depart from without, in the absence of some abnormal occurrence,
being exposed to danger which cannot be avoided by good navigation and seamanship.
Berth: Means the specific place where the ship is to load and/or discharge. If the word
Berth is not used, but the specific place is (or is to be) identified by its name, this
definition shall still apply.
Safe berth: Means a berth which, during the relevant period of time, the ship can reach,
remain at the depart from without, in the absence of some abnormal occurrence, being
exposed to danger which cannot be avoided by good navigation and seamanship.
Reachable on arrival or always accessible: Mean that the charterer undertakes that
when the ship arrives at the port there will be a loading/ discharging berth for her to
which she can proceed without delay.
Lay-time: Means the period of time agreed between the parties during which the owner
will make and keep the ship available for loading/ discharging without payment
additional to the freight.
Customary despatch: Means that the charterer must load and/or discharge as fast as is
possible in the circumstances prevailing at the time of loading or discharging.
Per hatch per day: Means that lay-time is to be calculated by multiplying the agreed
daily rate per hatch of loading/discharging the cargo by the resulting sum. Thus:
Per working hatch per day or per workable hatch per day- means that lay-time is to be
calculated by dividing the quantity of cargo in the hold with the largest quantity by the
result of multiplying the agreed daily rate per working or workable hatch by the number
of hatches serving that hold.
Thus:
= Days
Weather permitting: Means that time during which weather prevents working shall not
count as lay-time.
Excepted: Means that the specified days do not count as lay-time even if the actual hours
of work only count as lay-time.
Unless used: Means that if work is carried out during the excluded days the actual hours
of work only count as lay-time.
To average: Means that separate calculations are to be made for loading and discharging
and any time saved in one operation is to be set against any excess time used in the other.
Reversible: Means an option given to the charterer to add together the time allowed for
loading and discharging. Where the option is exercised the effect is the same as a total
time being specified to cover both operations.
Notice of readiness: Means notice to the charterer, shipper, receiver or other person as
required by the charter that the ship has arrived at the port or berths as the case may be
and is ready to load/discharge.
In writing: Means, in relation to a notice of readiness, a notice visibly expressed in any
mode of reproducing words and includes cables, telegram and telex.
Time lost waiting for berth to count as loading/discharge time or as lay-time:
Means that if the main reason why a notice of readiness cannot be given is that there is no
loading/discharging berth available to the ship the lay-time will commence to run when
the ship starts to wait for a berth and will continue to run, unless previously exhausted,
until the ship stops waiting. The lay-time exceptions apply to the waiting time as if the
ship was at the loading/discharging berth provided the ship is not already on demurrage.
When the waiting time ends time ceases to count and restarts when the ship reaches the
loading/ discharging berth subject to the giving of a notice time if provided for in the
Charter-party, unless the ship is by then on demurrage.
Whether in berth or not or berth no berth: Means that if the location named for
loading/discharging is a berth and if the berth is not immediately accessible to the ship a
notice of readiness can be given when the ship has arrived at the port in which the berth is
situated.
Demurrage: Means the money payable to the owner for delay for which the owner is not
responsible in loading and/or discharging after the lay-time has expired.
On demurrage: Means that the lay-time has expired. Unless the Charter-party expressly
provides to the contrary the time on demurrage will not be subjected to the lay time
exceptions.
Despatch money or Despatch: Means the money payable by the owner if the ship
completes loading or discharging before the lay-time has expired.
All time saved: Means the time saved to the ship from the completion of
loading/discharging to the expiry of the lay-time including periods excepted from the lay
time.
All working time saved or all lay-time saved: Means the time saved to the ship
from the completion of loading/discharging to the expiry of the lay-time excluding any
notice time and periods excepted from the lay-time.
Q1. An ore carrier, summer draft 960m, summer deadweight 23430t, TPC 30t; daily
consumption at sea 38t fuel oil and 16t fresh water leaves Victoria (south America) for
Middlesbrough calling at cape Verde islands for taking 800 tons fuel oil and required
quantity of fresh water. Victoria to cape Verde islands; 6 days; first 5 days of which in
Tropical zone and remaining 1 day in summer zone. Cape Verde islands to
Middlesbrough: 7 days first 4 days of which in summer zone and remaining 3 days in
winter zone. Port consumption at cape Verde islands 3t fuel oil and 10 fresh water. Three
days reserve of fuel oil and fresh water to be provided for all times at sea. Calculate the
maximum cargo that can be loaded in Victoria and the fuel oil on board on arrival
Middlesbrough.
Solution :
5D ( T )
1D( S )
4D ( S )
3D ( W )
----------------------- ---------- ---------------------------- ---------------------------------VICTORIA
CAPE
MIDDLES
VERDE
BROUGH
SUMMER DEADWEIGHT
23430 T
SUMMER DRAFT
9.60M
WINTER DRAFT
9.40M
TROPICAL DRAFT
9.80M
WINTER DEADWEIGHT
22830T
TROPICAL DEADWEIGHT
24030T
PLACE
ASSUMED
OF
TONNAGE
ITEMS
VICTORIA
24030
AFTER 5D 190
80
23760
AFTER 1D 38
16
23706
CAPE
3
VERDE
10
23693
+ 800
+ 122
24615
AFTER
4DAYS
ALLOWED
TONNAGE
EXCESS
24030
23430
330
23430
23430
23430
1185
276
-152
-64
24399
CHECK
22461
-190
-80
22191
-38
-16
22137
-3
-10
22124
+800
+122
23046
-152
22830
-1569
-64
22830
The charter may be an ordinary hire just as the hire of any moveable thing, for
instance, a motor car for an excursion, or it may be in the nature of a lease by
which the owner grants or demises the entire control and possession of the ship to
the charterer (charter by demise). This type of charter-party is appropriate when
a ship-owner is desirous of augmenting his fleet, or where a person wishes to
obtain full temporary possession of a ship, as when fitting out an expedition for
exploration. The demise charterer is in a position similar to the lease holder of
land, that is to say, he is for all practical purposes, except registration, the
temporary owner of the ship. Accordingly the duties and rights of the owner are
performed and exercised, respectively, by him. He is also bound by a salvage
award, and it is on his behalf that the master signs bills of lading, The master and
crew are his, and not the owner's servants. During the duration of a charter by
demise the owner's right is to be paid the hire or, as it is sometimes confusingly
called, the chartered freight. He is not allowed to interfere in any way with the
management of the ship, except in so far as the terms of the charter-party itself
permit. If the ship earns a salvage award the charterer by demise is entitled to it.
The common form of charter-party is that used between the shipper of goods and
the ship-owner.
Form of Charter-Party
The word 'charter-party' is derived from carta partita (divided document) which refers to
the ancient practice of writing out the terms of the contract in duplicate on one piece of
parchment and then dividing it down the middle, thus providing each party with a copy. It
is therefore not surprising to observe that to this day, despite the absence of a rule
requiring the written form, most negotiations by telephone or telex will eventually lead to
the formal drawing up of a written charter-party, with standard terms and riders attached.
Whether or not the parties can be said to be contractually bound before they sign the
charter-party will depend in large part on the intentions of the parties and the
circumstances of the case.
If a ship is owned by several owners, a part-owner who has not consented is not bound by
the charter-party. He cannot prevent the ship from sailing, but he may sue the other
owners for a bond securing his share. He then has no part in profit or loss of the chartered
voyage.
The actual terms of the contract contained in a charter-party are very varied and
complicated, and some of them, though naturally couched in different language, are
common to most charter-parties. Others depend very much on the type of trade on which
the vessel is engaged. Some big shipping companies have their own form of charterparty. Similarly, some very large shippers will only charter on the terms of their own
standard form. Again the ship-owners engaged in a particular trade, such as the
Baltic wood goods trade, may agree to use a standard form of charter-party. These
standard forms are more frequently than not amended and added to by what have
come to be called 'rider-clauses', which themselves give rise to numerous problems
of interpretation.
Bill of Lading
The charter-party evidences the hire of an entire ship, or at any rate a large part of
her such as a hold. It is clearly not a suitable form of contract for a person who
wishes to send a small parcel of goods. Such a person must look out for a ship,
which is carrying general cargo to the port to which he wishes to send his goods. A
vessel of this kind may be sailing regularly along a certain line of ports at advertised
times, when she is called a liner, or from port to port looking for cargo, when she is
called a tramp. Such ships are still called by lawyers 'general ships' and the owner is
a 'common carrier'. The contract of affreightment is in this case made (or more
strictly, evidenced) by a bill of lading, which is usually issued after the loading of
the goods. However, even in the case of chartered ships a bill of lading is invariably
issued; it is then not used as evidence of the terms of a contract but as evidence of
the shipment of goods, i.e. as a receipt. Moreover, unless it is a 'straight' bill of
lading intended for use exclusively between the shipper and the consignee, the bill
of lading has by mercantile usage come to represent the goods in such a way that the
transfer of it to a third party may transfer to the latter the property in the goods and
the right to receive delivery of them from the ship at her port of discharge.
(A)
(c)
It is evidence that its holder has the right to claim possession of the goods it
represents and that he might, in certain circumstances, have the property therein; that
is, it is a document of title.
(B)
The bills of lading are issued to the shipper in sets of three or four; if three copies are
issued, one is retained by the master or broker; two copies are dispatched, one
usually by express mail, to the buyer, or to any other addressee of the cargo, i.e. the
consignee. If the shipper and the consignee have agreed to use a letter of credit as a
method of payment, the copies would be tendered to the shipper's bank together with
the other shipping documents in return for the price for the goods shipped. By the
endorsement and delivery of the bills of lading to any sub-buyer, the latter as
assignees steps into the consignee's shoes and, on arrival of the ship at the port of
destination, the sub-buyer can take immediate delivery on presenting the bills of
lading representing the lot he has purchased from the importer, who will usually be
the consignee.
Relationship between Charter-Party and Bill of Lading
The relationship between the two contracts maybe puzzling, especially when both
documents are in use at once. The co-existence of two apparently equally
contractual documents has given rise to many technical difficulties. The principal
question is always: Wh6 is liable and who is entitled under the contract of carriage?
In other words, whom, ship-owner or charterer, do shipper and consignee hold
responsible for the safe arrival of the goods? Who, owner or charterer, is entitled to
the freight? In order to answer these questions it may be useful to set out the various
possibilities. There are normally four and they follow naturally from what we have
just said about the operation of the entire contract.
(i) The contract of carriage may be between the owner of a general ship and the
shipper. A charter-party is not then used and the contract is evidenced in the bill of
lading. This happens in almost all cases where goods are shipped by a liner.
(ii) The contract of carriage may be between ship-owner and charterer under an
ordinary form of charter-party. Here a bill of lading will be issued when the cargo is
loaded, but it will generally take effect as a receipt, not as a contract.
(iii) The contract may be between charterer by demise and shipper. Here there is a
contract in the nature of a lease, not a contract of carriage, unless and until one be
entered into between the charterer and some other shipper, when it will fall under (i)
or (ii) above, depending on whether the charterer puts up the ship as a general ship
or not. The contract of carriage is then, of course, between charterer and shipper.
(iv) Where the charterer under an ordinary charter-party does not ship goods himself
but transfers his right to do so to somebody else, there will normally be both a
charter-party and a bill of lading issued by the ship-owner or by the charterer, or by
agents for either to the shipper, and it is when that happens that the chief difficulties
arise. The most fruitful cause of trouble lies in the differences between the terms of
the two documents.
(v) Finally, it may even happen in exceptional cases that in respect of the same
voyage the contract of carriage in respect of one parcel of goods is made between
shipper and ship-owner, and in respect of another parcel between shipper and
charterer. Thus one bill of lading might be issued by the owner and one by the
chatterer, the master signing them being the agent once of the owner and once of the
charterer.
Difficulties may be experienced in cases (iv) and (v), for it may be uncertain whether the
shipper contracted with the owner or with the charterer. This is a question of fact to be
decided by looking at all the circumstances of the case. A common instance of such
difficulties is, for example, where a charterer is only a broker who guarantees cargo for
vessels, which he undertakes to load.
Cesser Clause
Normally a charterer who transfers his space to a shipper is only too anxious to drop out
of the transaction provided his profit is assured. This means that he is content to leave the
work of carrying to the ship-owner, and the bill of lading will accordingly be issued on
the latter's behalf and will constitute the contract of carriage except in so far as it may
expressly incorporate the terms of the charter-party. This result is usually brought about
by inserting what is called a 'cesser clause' in the charter-party.
It is provided by such a clause that the ship-owner shall have a lien on the cargo for
freight, dead freight and demurrage, and that the charterer's obligation to pay freight is
accordingly to cease as soon as a full cargo is shipped. At that moment, of course, the
right of lien will come into existence. A cesser clause takes, as a rule, some such form as:
This charter being entered into on behalf of others, all liability of the parties signing to
cease after shipment of cargo, in consideration of which it is agreed that for the payment
of all freight, dead freight, and demurrage, the said owner shall have an absolute lien
and charge on the said cargo.
Having examined the methods by which contracts of affreightment are entered into we
must come to the kernel of the matter, the rights and obligations of the parties in
connection with the actual transport of the goods, including loading and discharge. We
shall attempt to make this matter clear in the light of the general principles of law relating
to the distinctions between express and implied terms.
draw their own inferences from a relatively skeletal framework of facts brought forward
by the cargo-owner.
The Bill of Lading as a Receipt
The original function of the bill of lading was that of a receipt. It commences with the
words 'shipped' or 'received', and then proceeds to enumerate the goods according to
quantity, description and shipping marks. The bill of lading was originally issued by the
master at the time when the goods were shipped. In modern times, however, when the
goods are put on board the mate usually issues an informal receipt, which is later
exchanged for the bill of lading. Until the issue of the latter the ship-owner will usually
hold the goods on the terms of his usual bill of lading, and this is sometimes expressly
provided for in the mate's receipt.
Evidentiary Value of the Receipt
Disputes between ship-owner and cargo-owner arise perhaps most frequently over
the question whether goods have been delivered short, or have been damaged during
carriage. It is here that the statements about the goods appearing in the bill of lading
become very important. The obligation on the carrier is obviously to deliver what he
received as he received it, but just as obviously the next question is - and this
presents the real difficulty - on whom does the law place the burden of proof? Since
the goods' owner claims that the goods were not delivered as received it is for him to
prove this contention, and he can do so most easily by referring to the carrier's receipt
for the goods, namely, the bill of lading.
Now a receipt is prima facie evidence of the truth of the statements, which it
contains. If the person who issued it claims that it is wrong, it is for him to prove the
error. The carrier, therefore, who delivers to the cargo-owner a smaller number of
packages, or a less weight of goods than was acknowledged in the bill of lading, or
goods torn and dirty when he had issued a bill of lading which had made no mention
of such defect on receipt, will find it very difficult to resist a claim for damages. In
order to do so successfully he must prove affirmatively that the bill of lading was
wrong - that he delivered all he received, or that the goods were torn and dirty when
received on board the ship. Such proof may be very difficult and expensive,
involving perhaps the taking of evidence in a foreign port; it may indeed be
unobtainable, in which case liability is effectively established and the carrier can only
escape if he can find protection in one of the exceptions applicable to his contract.
Now that we have looked at the basis upon which and the contexts within which the
bill of lading is considered to be a binding receipt, we shall turn our attention to a
number of special related aspects.
Statements as to Quantity
Non-Shipped and Partially Shipped Goods
The student by now would appreciate that the reason why a cargo-owner can sue the
ship-owner on the basis of bill of lading statements as to quantity is that the bill is
considered to be a binding receipt or acknowledgement as to shipment on board the
carrier's ship. The bill becomes the carrier's receipt as a result of the master's
signature: the assumption throughout is that the master acts within the scope of his
authority in signing the bill and that therefore the master's bill is the owner's bill.
'Weight and Quantity Unknown' Clauses
We have seen that the binding force, which gives value to the receipt function of the bill
of lading has been a feature of the document for a very long period. Consequently,
carriers have for many years made a practice of inserting in the bill of lading some such
term as 'weight and quantity unknown', indicating that the statement as to quantity
appearing on the face of the bill is not to be relied upon and thus taking the teeth out of
the binding force of the document.
The result at common law is clear: the inclusion of these words in the bill of lading very
largely destroys its value as a receipt, except in so far as it remains evidence that some
goods have been shipped, goods said by the shipper to amount to the figure mentioned in
the bill of lading, but in respect of which the carrier makes no admission as to quantity or
weight. The result is that the burden of proving what actually was shipped is shifted back
to the shipper.
Apparent Order and Condition Clean Bills of Lading
Bills of lading normally start with the admission that the goods they cover have been
shipped in 'apparent good order and condition'. The effect of this representation, where
unqualified, is to raise a prima facie presumption that the goods were so shipped where
the shipper sues the carrier for delivery of damaged goods, and to raise an irrebuttable
presumption to that effect where endorsees who have acted to their detriment on the faith
of the statement sue the carrier for delivery of damaged goods. Where a carrier issues a
clean bill in circumstances properly calling for a claused bill, any indemnity extracted
from the shipper in consideration for the issue of a clean bill is unenforceable. The
admission can, of course, apply only to the outward appearance of the goods, since the
carrier has no means of judging their internal condition and quality; and the courts have
held this to be the correct view of the matter.
Moreover, it is also possible for the carrier to qualify his admission by entering a note of
anything appearing to be wrong with the goods at the time when they are shipped, e.g.
'two packages torn and dirty'. When a bill of lading contains a qualification of this kind it
is said to be 'claused'; without such a statement it is said to be clean.!'
Although it is possible for carriers so to clause their bills as to qualify their statement
about the apparent good order and condition of the cargo, such a qualification needs to be
very specific in terms if it is to achieve the result desired by the carrier.
The Bill of Lading as Evidence of Contract with the Carrier
We have seen above that the original function of the bill of lading was that of a
receipt. The bill of lading then became the document in which the terms of the
contract were set out. It should be noticed that the bill of lading is only evidence of
the, contract between ship-owner and shipper, not the contract itself.
Moreover, terms actually contained in the bill of lading may be varied orally, and
such variations are enforceable. All this, however, applies only between the
immediate parties to the contract, carrier and shipper. Third parties, such as
consignees or their assignees, who acquire rights by way of endorsement of the bills
of lading, are entitled and required" to assume that it contains within its four corners
either all the terms of the contract or at any rate references to other documents where
such terms may be found.
It is, of course, obvious that once the bill is issued the terms of the bill of lading operate.
But the question arises whether it should not also have retrospective effect. The contract
of affreightment, which the bill evidence is concluded long before its issue. Scarce
shipping space must be booked long in advance, and pressure of work at the shipping
office may delay the issue of the bill of lading until after the ship has sailed. During that
interval shipper and ship-owner have to perform many operations under the contract,
which give rise to rights and liabilities. Under the contract cargo is provided in time for
loading, the cargo is taken on board and stowed - but on what terms?
Example
In one case goods were damaged while being hoisted on board from the quay, and the
ship-owner invoked a limitation of liability clause applicable under the Hague Rules to
the bill of lading. The owner of the goods strongly objected because the bill had not yet
been issued, but the judge held that its terms nevertheless applied.
'When parties enter into a contract of carriage in the expectation that a bill of lading will
be issued to cover it they enter into it upon the terms which they know or expect the bill of
lading to contain. Those terms must be in force from the inception of the contract; if it
were otherwise the bill of lading would not evidence the contract but would be a
variation of it.'
The Bill of Lading as a Document of Title
It was early found convenient to use a copy of the bill of lading as a document ordering
delivery of the goods at the port of discharge. This came about in the following way.
Originally, merchants travelled with their goods on board the same vessel, but when they
ceased to do so it became necessary to devise some means by which the carrier could be
enabled to deliver the goods to the proper person. The simplest thing was to send a copy
of the bill of lading under separate cover so to speak, and even by a different ship if there
was a faster one going, to the shipper's agent at the port of delivery. Eventually, when
goods were shipped direct to buyers, the bill of lading was sent to them and the buyers
were made consignees of the goods.
In the bill of lading, therefore, the carrier began to agree to carry the goods, say to
Antwerp, and there deliver them not only (a) to the shipper but, alternatively (b) to
the shipper's order, so that the shipper could, by endorsing on the document an
order that the goods should be delivered to the buyer, enable the latter to get the
goods himself; or (c) to a named consignee. These three options shared the common
feature that the bill operated as a document entitling delivery only in favour of the
shipper or the shipper's buyer.
Practical Guidance
Signing bills of lading
One of the most important functions of a bill of lading is that it provides information as to
the description of the goods, the condition of the goods, the quantity of the goods, the
loading port and date of shipment, the discharge port, the name of the ship, whether
freight has been paid and the terms of carriage. As these functions are essential to trade it
is important that information given in a bill of lading is accurate. Failure to ensure
accuracy can give rise to liability of the ship owner.
The essential rule is that in no circumstances, other than those described at paragraph
11(a), should the master sign a document which he knows to be untrue, or which he
believes may be untrue, or where he has not given careful thought to the facts contained it
The following matters are important. If the master cannot contact the ship-owner or
obtain guidance from it, the following general principles should be applied.
The master must ensure that the information on the bill of lading agrees with that on the
mates receipt(s).
The master must check the facts about the cargo. It would be unusual for the master or
the ships agent to prepare the bills of lading. The bill of lading is usually prepared by the
shipper or the shippers agent. It is accordingly essential for the master to check the
information about the cargo in the bill of lading. The master will not know all of the facts
about the cargo that appear on the bill of lading which he is being asked to sign. This
problem is dealt with specially in the section entitled Information in the bill of lading
(paragraph4).
The master must check the facts about the voyage. If the place or date of loading is
incorrect, or if the discharge port is outside the Charter party range, the master should
refuse to sign.
It is recognized that refusal to sign is not always safe or practical. Where in this practical
guidance section of the book the master is advised to refuse to sign, he should refer to
paragraph 11 for guidance.
Information in the bill of lading
This section deals with ways of describing the cargo and the voyage. It is intended to give
the master guidance where he is unable to obtain guidance from the ship-owners. It may
also assist the master in identifying what is a usual and what is an unusual situation.
Some of the information in the bill of lading is within the maters knowledge, for
example the port of shipment, the date of completion of loading of the parcel described in
the bill of lading or the date of issue of the bill of lading. If these facts are not correct the
master should refuse to sign the bill of lading.
Some information in the bill of lading may not be within the precise knowledge of the
master, for example the quantity or weight or the actual condition of the goods loaded.
The following rules may assist.
Quantity
The master should if possible add the words Shippers figures or shore figures to any
statement as to quantity or weight on the bill of lading.
If the master does not know the weight or quantity loaded (because there has been no
opportunity for a tally or an accurate draught survey) then the words weight and quantity
unknown should be written alongside the figure.
If the ship has its own figures and these differ from those in the ;bill of lading, then the
ships figures should be written alongside the shippers figures and/or the words weight
and quantity unknown added.
If in situation (iii) the master is not permitted to add the ships figures and if the
difference between the shippers figures and the ships figures is more than could
reasonably be explained by the practical imprecision of draught surveys or tallying then
the master should refuse to sign the bill of lading. If the difference is small he should
follow (ii) above.
Condition
Usually the master only knows the apparent condition of the cargo. Accordingly if he can
see no apparent problem with the goods when loaded he should mark the bill of lading
received in apparent good order and condition.
If the master can see that the goods are damaged in some way then he should say so. A
more difficult question is where the master thinks that the goods may be defective or
substandard, for example because they appear dirty, mixed with foreign particles or
debris, or are discoloured or odorous. If such comments are appropriate he should do his
best to explain in ordinary language in writing on the face of the bill of lading what he
believes is wrong with the condition of the cargo. If he requires to add an additional sheet
of paper then he should state (in writing on the bill of lading) how many sheets of paper
are attached to each bill of lading. He should seek guidance from the P &I club or its
local correspondent or agent or from a surveyor as to the precise wording to be used.
It is always useful to describe the nature of the packaging of goods, for example in paper
bags or in polythene sacks. If these are torn or damaged the bill of lading should say so,
such as about 457 bags torn. If only a rough estimate can be made of the quantity
damaged, however, this should be started, for example about 10% torn or about 5000
bags damaged. Whether it ;is on the basis of a tally or estimate, the master must have
evidence to support his remarks.
Special clauses are often used, for example for timber or steel cargoes, and if possible the
ship-owner or the P & I club correspondent should be consulted.
Quantity and condition
The words weight, measure, quantity, condition, contents and value unknown are useful
and desirable words to add to a bill of lading if they are not already part of the printed
form.
Quality
The master need not describe the quality of the cargo.
For the avoidance of doubt the master should place his signature and/or the ships stamp
at the foot of the bill of lading only.
Specific situations
Freight / hire / demurrage / liens
The master may be worried that a bill of lading presented to him does not give the shipowner sufficient protection in terms of freight, hire or demurrage, or liens for any of
those, or he may be worried about other terms of carriage. These are all matters for the
ship-owner or its P &I club to consider. The master should always check with the ship
owners managers as to whether they requires protective terms to be added, but leave the
decision to them.
Deck cargo
Except in purpose-built container ships or in special trades where cargo is customarily
carried on deck, carriage of cargo on deck should always be checked with the ship-owner.
Where cargo is carried on deck it is essential to state on the face of the bill of lading that
cargo is being carried on deck. It is for the master to check with the ship-owner to ensure
that such carriage is permissible.
How many bills of lading to be signed?
The master should check with the shipper and with the Charter-party. He should also
check the terms of the bills of adding themselves as they may show the number to be
issued. There is no general rule as to what number should or must be issued for a parcel
of cargo.
Blending / co-mingling of oil cargoes
Oil cargoes are unusual in that charterers and traders may wish to co-mingle cargoes
shipped from different ports on different dates, and often with different specifications.
If cargoes shipped from separate ports, on separate dates and/or of separate origins are
co-mingled, then complications arise as to the accurate description of the port of
shipment date of shipment and type of cargo in the bills of lading. Further problem may
arise at the discharge port if the cargo mixed in the tanks no longer resembles the cargo
described in one more of the original bills of lading.
Wherever there is co-mingling of cargo shipped on different dates from different ports
and of different types, it is essential that the ship owners instructions are obtained before
bills of lading are issued. If the ship owners instructions cannot be obtained the master
should refuse to sign and should explain his reasons for doing so by reference to (b)
above.
Letter of indemnity
It is not for a master to agree to sign a bill of lading in return for a letter of indemnity.
That is for the ship-owner to decide. If it better for the master to follow the steps at
paragraph 11 than to accept a letter of indemnity without the ship owners authority.
Refusal to sign
In circumstances where the master feels that he should refuse to sign a bill of lading he
should seek guidance from the ship-owner or from the P & I club or its correspondent. If
no guidance can be obtained, the following general principles should be applied.
If the refusal of the master to sign a document is met with physical threats or coercion
against the ship or her master or crew, then the master should sign the document. When
the vessel has sailed and upon reaching a position of safety, the master (or the shipowner, if it is now the contact with the master) may give notice of protest to all parties
and authorities concerned to the effect that the document has been signed under duress
and the ship-owner and the master consider themselves not bound by the masters
signature. Of course thought must be given as to whether the ship, master or any sister
ship is likely to return to this dangerous regime).
Sometimes legal pressure will be exerted on the master to sign. The most common
example will be where the ship is operating under a Charter-party. The Charter-party may
list the masters obligations with regard to signing bills of lading. For example he may
have to sign bills of lading as presented. This and similar expressions do not mean that
the master must sign any bills of lading whatever its terms. The master ca refuse to sign a
bill of lading as presented if it.
However, if the master is required by the Charter-party to sign bills of lading as
presented he should not refuse to sign a bill of lading simply because it is marked, for
example liner out, or because it contains some foreign jurisdiction clause. These are not
facts but terms of the shipper or charterers trade. They are matters for the ship-owner to
argue about with the charterer if necessary. It the master is requested to sign freight prepaid bills of lading his position is slightly less clear.
Sometimes commercial pressure will be exerted on the master to sign in circumstances
where he should, as advised above, refuse to sign. It is for the ship-owner to make
commercial decisions in response to such pressure. The ship-owner may wish to
negotiate, take the commercial risk or accept a letter of indemnity. The master, however
does not have these options. He should maintain his refusal to sign. Delay to the vessel or
other consequences of threats made by the shipper or charterer may then perhaps be
avoided by the following steps.
The mater should sign the document in the form that he is prepared to give. For example,
in the case of a bill of lading where the quantity or description of the cargo is in dispute,
the master should sign a bill of lading showing the quantity or description which he
considers being accurate. The bill of lading should be left with the ships agent (and a
protecting agent appointed for this purpose if possible). Notice can then be given that a
bill of lading for the cargo has been signed and issued and is available for collection.
Alternatively, the master should give notice that he has given authority to the ships
protecting agent to sign bills of lading on his behalf subject to instructions and approval
from the ship-owner when available.
The master should not sign bills of lading in blank.
Where any person coming on board insists that the mater takes delivery of a document
from them he should mark it for receipt only.
Specific issues
Letter of indemnity
The giving of letters of indemnity in return for delivery of cargo at the wrong discharge
port or without production of the original bill of lading is not wrong nor is it unusual. It is
however, a matter for the ship-owner to decide upon. It is a commercial decision for it to
make and one which it will make taking into consideration the fact that it may have no P
& I cover as a consequence of doing so.
Recommended standard letters of indemnity are included in the appendices, to sign an
indemnity for unquantified amounts. Frequently therefore the letter is accepted without a
banks counter-signature. Alternatively a limit (e.g. 150% of the value of the cargo)n is
placed on the banks liability under the letter. Again, these are commercial decisions for
the ship-owner to take.
Photocopy or faxed bills of lading
Sometimes the master is asked to deliver against a copy or faced bill of lading the
original being unavailable. Unless special arrangements have been in writing by the shipowner to accept such a bill of lading, delivery should be refused. The usual rule is that
delivery shall be given against presentation of at least one original bill of lading.
Multiple originals
Bills of lading are often issued in sets of three or four originals. The bill of lading will
usually provide on its face that production of any one of those originals will be
acceptable. At the same time, the other original are considered to be void and cancelled.
Retention of the original bill of lading
The master should retain the original bill of lading against which cargo has been
delivered. However originals are sometimes required by local officials or customs and in
those circumstances the master should ensure that he (or his agent) is allowed to see the
original bill of lading and that he is allowed to retain a photocopy of the front and reverse
side of the original. This should if possible be certified by the receiver or his agent as
follows. This is certified to be a true copy of the original bill of lading which is now
accomplished.
More than one person demanding delivery of the cargo
This situation may arise where:
No bills of lading are available at the discharge port
More than one set of bills of lading has been placed in circulation, all or some of
which are unauthorized.
The original shipper has parted with the bills of lading and is asserting that the
holder has not complied with its obligations under the sale contract for example it
has somehow acquired the bills of lading without making payment.
Each of the situation places the mater (and the ship-owner) in a very difficult position and
can give rise to complex legal issues and may involve complex commercial and legal
solutions. The best advice that can be given to the master, if he cannot obtain guidance
from the ship-owner is as set out in paragraph 17.
Change of destination during voyage
Sometimes the master may be asked to change destination during the voyage and to
proceed to a discharge port other than that named in the bill of lading. That is a matter for
the ship-owner to give instructions upon. In the absence of clear guidance from the shipowner or the local P & I correspondent, the master should take note of the following.
Even if the governing Charter-party gives a range of discharge ports, once a bill of
lading has been issued naming a discharge port, that destination should be treated as if
written into the Charter-party.
So far as the bill of lading holder is concerned, the diversion of the vessel to a different
discharge port will be a deviation the consequences of which can be serious for the
carrier.
Promises by a party seeking to change the destination (be it charterer, shipper or receiver)
that it holds all the original bills of lading or that the parties holding the bills of lading
have agreed to the change, may at best be meaningless and at worst untrue. If such parties
are genuinely in a position to make proper arrangements for the change of destination
then they should be in a position to provide a letter of indemnity (see (D) below)
including an undertaking for the return of all the original bills of lading.
As stated at paragraphs 18 and 19 the provision of letter of indemnity in return for
delivery of cargo at a different destination is not unusual. However the standard wording
for a change of destination letter of indemnity (See appendix iv) expressly provides for
the return of all of the original bills of lading and any letter of indemnity which omits this
fundamental provision should be regarded as inadequate and rejected.
Atypical bill of lading the BIMCO Congenbill
The standard BIMCO congenbill has been selected because of its widespread use. Each
item in he bill of lading has been marked with an orange number which refers to the
relevant paragraph number in the text below. Although many of the terms and conditions
shown on the reverse of the bill of lading are relatively short and simple compared with
those of a more detailed liner or combined transport bill, the essential information
contained in the congenbill is typical of all bills of lading.
Shipper
The shipper will frequently be the party which prepares the bill of lading and supplies
much of the information to go in it. This information must be checked carefully. Where
the Hague, Hague-Visby or Hamburg Rules apply compulsorily the shipper is entitled to
have a bill of lading giving certain information issued to it upon shipment of the cargo.
The shipper is under an obligation to provide accurate information and if any of that
information is inaccurate and leads to liability of the carrier, then in certain circumstances
the shipper can be liable to indemnity the carrier.
Consignee
The information contained in this section is not primarily the concern of the master. It is a
matter between the seller of the goods (often the shipper) and the intended buyer or
buyers. Depending upon the nature ;of the underlying sales transaction, typical entries in
the consignee box may be the words bearer or holder it may name a consignee; it may
show the words to order with or without the name of the consignee or the box may
simply be left blank. Each of these affects the transferability of the bill of lading and with
it, control over the delivery of the goods. They are not matters which should trouble the
master at the time of issue of the bill of lading.
Movement of the bill of lading under the sale contract
The goods are on board and the bill of lading has been signed. What happens next in the
sales transaction, and in particular, what happens to the bill of lading?
What happens to the bill of lading?
The answer in that now the goods are on the move, it is time for the documents to move.
The bill of lading will go with other documents to form a complete set of shipping
documents. The shipping documents will usually comprise:
The bill of lading issued by the master or his agent as discussed earlier
The marine insurance policy insuring the goods against loss of damage on the
voyage.
The commercial invoice.
There are the main documents. Others may include:
A certificate of quality/quantity
A certificate of origin
To explain the letter of credit system very briefly where the contract of sale provides for
payment ;by letter of credit the buyer will arrange for its bank to open a credit (a promise
to pay) in favour of the seller for the price of the goods. The bank is called the issuing
bank. The issuing bank will then contract its correspondent bank in the country where the
seller is based and this bank will either advise the seller that the letter of credit has been
opened and that the issuing bank will pay upon receipt of the shipping documents, or it
will confirm first instance acting as an advising bank and in the second instance as a
confirming bank in which case it is confirming to the seller that it the confirming bank
will pay upon receipt from the buyer instructions which show the documents required by
the sale contract. When the shipping document are delivered to the advising or
confirming bank, they will be examined to make sure that they comply with the
instructions under the sale contract, and the seller will be paid either directly by the
confirming bank or in due course by the issuing bank (via the advising bank).
As the bill of lading passes through the hands of these banks it represents security for any
money they may have advanced on the goods and can be held by them until the buyer has
satisfied his obligations to the issuing bank.
When the bill of lading is in the hands of the buyer he will contact the ship owner or
charterers agent at the discharge port and demand delivery of the goods to him.
Alternatively he may wish to sell the cargo to another party in which case the bill of
lading will again be used in this next transaction as a receipt (showing what the new
buyer is buying) as a document of title (giving control to the new buyer in return for
payment) and as a contract of carriage with the new buyer who will acquire legal rights
against the ship-owner.
The master must deliver the cargo to the person holding the bill of lading at the named
discharge port. The carrier can deliver the cargo to the holder of a bearer bill of lading
The person demanding delivery of the cargo must provide some evidence that it is the
person identified in the bill of lading. As the bill of lading would usually be presented
through the ship-owner or time charterers agents who are local to and familiar with the
discharge port the master probably need only be worried about identification of the
person demanding delivery if the master has actual reasons for believing there is some
reasonably ground for suspecting that the person is not entitled to claim the goods, or if
the master has been notified of a competing claim for the goods.
By way of background information it may be useful briefly to explain the legal and
commercial mechanism by which the bill of lading, and therefore the right to receive or
control receipt of the goods, passes from person to person.
Explanation
If the bill of lading shows
Shipper : X
consignee: to order
Then the shipper has the power to endorse the bill of lading and give orders as to whom
the cargo should be delivered. An endorsement is simply the signature of the shipper on
the back of the bill of lading. An endorsement in blank is the signature of the shipper
alone. This means that any person to whom the bill of lading is intentionally passed can
claim to be the proper holder of the bill of lading. A special endorsement is where the
shipper wishes to direct the ship-owner to deliver to a particular person. In that case, the
shipper puts his signature and the name of the intended recipient on the bill of lading.
If the bill of lading shows
Shipper : X
Consignee: Y
Then the bill of lading can be consigned (that is physically passed) to Y who then
becomes the proper holder of the bill of lading. However because the bill of lading gives
no expressed power to order delivery, neither X or Y can endorse the bill of lading to
any other party either by blank endorsement or by special endorsement. This kind of bill
is sometimes called a straight or non-negotiable bill of lading and in many respects is
similar to a sea waybill.
If the bill of lading shows
Sipper : X
Consignee: Y or to order
Then the bill of lading can be consigned to Y as in (b) above. However if Y wishes he
can then endorse it, in blank or by special endorsement, to any other party who will then
become the proper holder. That party cannot hen endorse in further.
If in situation (c) above a special endorsement on the bill of lading shows Z or order,
then that endorsee can further endorse the bill of lading.
If the bill of lading shows
Shipper : X
Consignee: bearer (or left blank)
Then the holder of this bill of lading is the person to whom cargo is to be delivered. The
bill of lading can move from person to person by simple consignment (that is by being
physically passed from person to person).
All of the above are genera rules and are determined by what is written in the consignee
box in the bill of lading. These general rules may be varied by express terms on the bill of
lading stipulating how it is to be transferred.
The voyage delivery loss and damage to cargo
The ship has been loaded and bills of lading issued. The shipping documents should now
be working their way through the sale and accompanying finance transactions. The
master is now under a duty to carry the cargo safely to destination by the usual
geographical route, to care for the cargo en route, and to deliver the cargo in the same
condition as when loaded to the person rightfully entitled to receive the cargo.
These obligations are essentially contractual in nature the master by receiving the
shippers goods on board agrees to carry them safely to their destination. This basic
promise is usually embodied in the bill of lading and may be modified by one or more of
the various sources of obligations. To be precise the bill of lading is not the contract of
carriage. The agreement to carry the goods has usually been made before the goods have
been taken on board. However it is usually been made before the goods have been taken
on board. However it is usually the document which provides the best evidence of the
terms of the contract of carriage. Furthermore as against a consignee or endorsee, the bill
of lading as drawn will be treated as the complete contract in any dispute with the shipowner.
The duty to carry
The master is expected to proceed from the load port to the discharge port without delay
and without departure from the usual geographical route. If he fails to do so then this may
amount to a deviation from the contractual voyage. The word deviation is a legal
expression which requires further explanation.
Deviation
Deviation in its legal sense is an unjustified departure from the contractual voyage. The
general rule is that the contractual voyage will follow the usual geographical route. This
general rule may not apply if it can be shown that
There is a universal custom to follow another route
That the circumstances surrounding the voyage made it clear that the intention of
the parties was that some other route should be taken
If the bill of lading expressly describes what route is to be taken or gives the ship
owner liberty to select alternative routes even if this means departing from the
usual geographical route
If it is necessary for the ship to leave the contractual route for reasons of the
safety of the venture
If one of the sources of obligation listed in paragraph 58 permits diversion, for
example the Hague-Visby Rules permit deviation to save life or property or any
reasonable deviation
Where the ship departs from the contractual voyage without justification the
consequences of this deviation in legal terms are very drastic. In very broad terms, the
ship owner will be deprived of its contractual rights (for example, to receive freight and
to enjoy defences expressly given to it by the contract) and in addition may prejudice its
insurance cover.
It is therefore important to realize that instructions to take the cargo to any destination
other than that named in the bill of loading, even when those instructions are given by
characters or shippers who may appear to have very good reason for giving those
instructions, should be related with the utmost caution. In every circumstances where
such instructions is given, the ship owner of the P & I association should consult.
Change in destination
Some times a change of destination can be agreed. The essential ingredient of such
agreement is that the party giving the order for change of destination must be in a
position to return the complete set of original bills of lading at the discharge port. This is
essential because if one or more of those originals is now in the hands of another holder
then that person may call upon the ship owner changes destination and discharges the
cargo at a new destination without collecting in all of the bills, then at some time in the
future any uncollected bill may form the basis of a claim by its holder for mis-delivery.
This is why in the standard recommended wording for the letter of indemnity to be given
by a charterer or the bill of lading holder for change of destination, there is an absolute
undertaking to return all sets of the original bills of lading.
Some bills of lading for example, the congenbill, provide that the vessel shall proceed to
a port or so near thereto as she may safely get. This may ultimately give the master the
right to carry the cargo to another discharge port if the vessel is prevented from reaching
the named discharge port. However the master is bound to wait a reasonable time before
he is entitled to proceed to an alternative place of discharge and that reasonable time will
depend upon the nature of the voyage. It is a matter to be decided between the ship owner
and the charterer or shipper after careful consultation.
Delay
Delay in proceeding to the discharge port may cause loss to the buyer of the goods. Delay
may also amount to a deviation in the legal sense. However simple failure to commence
the loaded voyage and proceed as quickly as possible is not a deviation in the legal sense.
To amount to a deviation in the legal sense delay which makes the voyage performed
entirely different from that which the parties envisaged would be performed would have
to occur.
It is not the function of this guide to set out a detailed analysis on the complex law of
deviation. The purpose of this short section is to emphasise the importance of proceeding
directly from the load port to the discharge port as named in the bill of lading unless there
is very good reason by reason of contract, custom safety or agreement, to do otherwise.
One final note on delay. The Hamburg Rules if applicable have express provisions
dealing with delay (see paragraph 83 and appendix VII, Article 5 of the rules).
movable (or negotiable) and tangible symbol of title to the cargo or, more accurately, the
right to control receipt of the cargo at its destination.
The master must deliver the cargo to the person holding the bill of lading at the named
discharge port. The carrier can deliver the cargo to the holder of a bearer bill of lading
(see paragraph 185 (e). if a bill of lading shows a consignee or named endorsee (see
paragraphs 185(a)- (d) the person demanding delivery of the cargo must provide some
evidence to the carrier that he is the person identified in the bill of lading. As the bill of
lading would usually be presented through the ship owners or time charterers agents
who are local to and familiar with the discharge port, the master probably need only be
worried about identification ;of the person fraud, that the bill of lading may have been
stolen that the person is not entitled to claim the goods, or if he has been notified of a
competing claim for the goods,
The problems which usually arise are where no bill of lading is available at the discharge
port. Delivery of cargo is requested at a port which is not the named discharge port.
Delivery of cargo without production of the bill of lading
Delivery of the cargo to a person who does not hold a bill of lading is a breach of the bill
of lading contract itself and the holder of the bill of lading can bring a claim against the
ship-owner. Such delivery is also an infringing those rights. (the cargo owner can also of
course, bring a claim against the party who has wrongfully demanded delivery of the
cargo). Similarly delivery at the wrong port is not only a deviation under the contract of
carriage but is also an infringement of the true cargo owners rights if this is done in
circumstances where the agreement to change destination has not been accompanied by
the return of all of the original bills of lading.
Some of the comments that follow appear in the practical guidance section of this guide.
Those comments are here augmented by further explanation and legal notes.
In the absence of clear guidance from the owner or the P & I club correspondent the
master should take care note of the following points:
The unavailability of a bill of lading at the discharge port is not the masters
problem. It is the problem of the buyers and sellers of the cargo
The master should not agree to discharge the cargo against a letter of indemnity
(unless the ship-owner has expressly agreed to this). The master does not have
authority on behalf of the ship-owner to vary the bill of lading contract in this way
Delay to the vessel while waiting for the bill of lading will usually be paid for
under the Charter-party in the form of hire or demurrage (or as part of the
Laytime which has been paid for in the freight payment). Even if the vessel is
threatened with the cost of the delay, that threat should not justify delivery of the
cargo without production of the bill of lading or at the wrong port
Delivery without production of the bill of lading, or at the wrong port, will be a
breach of the terms of the ship owners P & I insurance and there may be no
brought by the true cargo owner
In some jurisdictions the cargo can be discharged (at the named discharge port)
into the custody of the port or a private warehouse where it will remain under the
legal control of the master until the bill of lading has been produced. The master
should investigate this, if possible through the P & I club correspondent
Specific issues
Letters of indemnity
Unlike letters of indemnity given in return for issuing clean bills of lading (which are
unenforceable as the bill of lading will deceive its holders), the giving of letters of
indemnity in return for delivery of cargo at the wrong discharge port or without
production of the original bill of lading is not wrong nor is it unusual. It is however a
matter for the ship-owner to decide upon. It is a commercial decision for it to make. The
desire to satisfy a charterer or receiver, and to free the vessel, must be balanced against
the loss of P & I cover and the risk that the cargo may have been sold twice.
Standard letters of indemnity for these situations appear at appendices and III. These
standard forms show counter-signature by a bank. Banks are rarely prepared to sign an
indemnity for unquantified amounts. Frequently, therefore, the letter is accepted without
a banks counter-signature. Alternatively a limit (e.g. 150% of the value of the cargo) is
placed on the banks liability under the letter. Again, these are commercial decisions for
the ship-owner to take.
Photocopy or faxed bills of lading
Sometimes the master is asked to deliver against a copy or faxed bill of lading, the
original being unavailable. Unless special arrangements have been made in writing by the
ship-owner to accept such a bill of lading, delivery should be refused. The usual rule is
that delivery shall be given against presentation of at least one original bill of lading.
Multiple originals
Bills of lading are often issued in sets of three or four originals. The bill of lading will
usually provide on its face that production of any one of those originals, will be
acceptable. At the same time the other originals are considered to be void and cancelled.
Retention of the original bill of lading
The master should retain the original bill of lading against which cargo has been
delivered. The receiver should have no need to retain it as a contract of carriage it is
merely evidence and a copy will suffice, as a document of control its function is now
complete as a receipt for the good it makes sense that it should be returned to the master
when the goods are delivered.
However originals are sometimes required by local officials or customs and in those
circumstances the master should ensure that he (or his agent) is allowed to see the
original bill of lading and that he is allowed to retain a photocopy of the receiver or his
agent as follows: this is certified to be a true copy of this original bill of lading which is
now accomplished.
More than one person demanding delivery of the cargo this situation may arise where no
bills of lading are available at the discharge port more than one set of bills of lading has
been placed in circulation, all or some of which are unauthorized. The originals from a
single set have found their way in to the hands of a number of holders. The original
shipper (seller) has parted with the bills of lading and is asserting that the holder has not
complied with its obligations under the sale contract (e.g. it has somehow acquired the
bills of lading without making payment).
Each of the situations places the master (and the ship-owner) in a very difficult position.
The master is now on notice that one or more of the bills of lading may not be valid, and
that one or more of the holders may have acquired possession of the bills of lading in
circumstances where the transfer of the bills of lading into their possession was not
intended to transfer the right to demand delivery.
The situations can give rise to complex legal issues and may involve complex
commercial solutions and legal solutions.
Change of destination during voyage
Sometimes the master may be asked to change destination during the voyage and to
proceed to a discharge port other than that named in the bill of lading. The master has no
authority on the owners behalf to vary the contract of carriage in this way. The shipowner may choose to accept a letter of indemnity in return for such a variation. These are
matters for the ship-owner to decide.
Other matters
Co-mingling of oil cargoes
There appears to be an increasing practice for oil traders to co-mingle cargoes from
different ports shipped on different dates and often with different specifications. This can
create difficulties in the context of issuing bills of lading. These difficulties derive from
three points.
When goods which essentially are of the same specification are shipped by more than one
shipper, and the goods are co-mingled on board the carrying ship, then the shippers share
ownership in the whole of the mixed goods.
Where the goods are of different specification then not only do questions of shared
ownership arise, but also all the goods shipped may be reason of co-mingling have
changed in nature or specification.
If the goods have been shipped on different dates from different ports, then each bill of
lading must accurately show the ports of shipment and the dates of shipment for the
reasons given at paragraphs 156 and 157. a single bill of lading for the co-mingled cargo
could not accurately describe these details.
To the oil trader none of these points may be of great significance because it will be his
intention to control ownership of the cargo at some stage and then to sell it in different
parcels and with its newly acquired specification. None of this is within the ship owners
knowledge, however and so it must fall back on basic principles so that it can ensure that
in respect of each parcel shipped a bill of lading is issued showing the time and place of
that shipment, and the number quantity, weight, marks and apparent condition of the
goods. The master must proceed on the basis that each shipper will require in individual
bill of lading for each parcel. Practical guidance is given at paragraph.
Whether the master can properly be instructed to co-mingle one cargo with another is a
matter of contract between the owner and usually the charterer (often the oil trader).
Often there is provision in charter parties for co-mingling to take place. If the bill of
lading records the receipt onboard in apparent good order and condition of a parcel of
cargo which is subsequently mixed with a cargo of different specification then there is no
basis for clausing the bills of lading but there is a possibility of a claim or claims at the
discharge port from disappointed consignees.
The problems which will undoubtedly arise with the issue of bills of lading in
circumstances where cargoes are co-mingled and the problems arising from the owner
making a contractual commitment to co-mingle cargoes received on board, can all be
resolved by proper negotiation of the governing charter party return of original bills of
lading and letters of indemnity. These are matters for the ship owner to decide. It is
important when faced with these situations for the master to adhere carefully to the
principles set out above.
Mixing of dry cargoes
In practical terms the mixing of dry cargoes will usually involve goods of one description
loaded at one port and so many of the difficulties in issuing an accurate bill of lading will
not arise. The point at paragraph 224(a) does arise but will not be of practical importance.
The individual buyers will draw their share of the cargo from the bulk cargo. If separate
bills for each parcel loaded were not issued delivery may be given against presentation of
the original bill together with ships delivery orders or non-negotiable bills for the
separate parcels, sometimes known as split bills.
cargo itself, there is considerable likelihood that the ship-owner will be found to be
bound by these bills of lading. The ship owners remedy is against is against the charterer
or its agent.
What dates should be inserted in a bill of lading which refers to a charter party?
If the head-charter party is a voyage charter party then the date of this charter party
should be inserted. The position is less clear if the head-charter party is a time charter
party but in the absence of guidance or instruction from any other source the master
should insert the date of the head charter party. This is the contract with which the shipowner is familiar. Also the time charter party will usually contain express provision as to
certain terms which are to be included in any bill of lading which is issued. Reference to
this charter party in the bill of lading may incorporate these clauses into the bill of lading.
There may be a number of charter parties and therefore the master should if possible
check with the ship-owner to see what date is to be inserted in the bill of lading. The
ship-owner is in the best position to advise on this.
Freight
Freight terms on a bill of lading are of great importance to the shipper and consignee of
the cargo as they will show either that the ship-owner has received the freight (e.g.
freight prepaid) and therefore that the ship-owner will not be exercising a lien over the
goods at the discharge port or that all or some of the freight remains payable (e.g. payable
at destination). If there is no charter party involved then any freight terms recorded on the
face of the bill of lading for example that freight has been prepaid or that a certain
amount has been paid in advance will operate as a receipt issued by the master on behalf
of the ship-owner confirming that the money has been paid to the ship-owner. If the
vessel if operating under a charter party the charterer will usually receive the freight for
the shipment (e.g. where he is a time charterer receiving freight from a voyage charterer
or a CIF seller receiving freight from the buyer within the sale price of the goods). In
those circumstances it would not seem to be sensible for the ship-owner to issue a receipt
for something which it has not received.
Despite this it can be dangerous for a master to refuse to sign a bill of lading which
includes terms as to payment of freight particularly if those terms are standard within the
charterers trade. So for example when its ship if operating under a time charter party and
the obligation on the master is to sign bills of lading as presented, the master should not
generally refuse to issue bills of lading simply because they are marked freight prepaid
and a ship-owner should be very careful to take detailed legal advice before it instructs
the mater not to sign such a bill. Voyage charterer parties usually contain terms that are
more precise about the issue and release of bills of lading marked freight pre-paid or will
expressly state the freight terms that are to be included in any bills of lading issued under
the charter party for example that freight is payable at destination. If no provision has
been made in the voyage charter party for the issue of freight pre-paid bills of lading the
master should seek clear instructions from the ship-owner. If he cannot obtain
instructions then he should advise his shippers and charterer that he is awaiting clear
instructions from the ship-owner that the bills of lading in the hands of the owners agent
to be released only with ship owners consent.
INCOTERMS 2000
1.
EXW=EX WORKS:
In this term the seller delivers the goods by keeping it ready in deliverable state at the
sellers place or another named place. This named place can be factory / godown or
manufacturing unit. In this term seller does not clear the goods for exports nor goods are
loaded on vehicle. The obligation under this term on seller is very less and on buyer it is
maximum.
Buyer bears all costs and risks in taking the goods from sellers premises. Under this term
the sellers obligation will be to provide the goods of agreed quality along with necessary
invoice and documents. The seller must keep the goods ready at the name placed duly
packed. The seller will be responsible for loss of or damage to the goods until they have
been delivered to buyer or his representative. The buyer must pay the price as agreed in
the sales contract. He should also, if required, arrange for necessary export licence or
permit. The buyer must bear all risks of loss of or damage to the goods from the moment
the goods have been delivered. In case the delivery date or any period is fixed and the
seller has appropriated clearly goods in identified condition as the contract goods, then
upon the expiry of the said date the risks get transferred to the buyer.
2.
This term refers to sellers responsibility to deliver the goods, cleared for export, to the
carrier appointed by the buyer at the named place. In this term the place of delivery is
very important. If the delivery is at sellers places then he is responsible for loading. If
the delivery occurred at any other place, the seller is not responsible for unloading. This
term can be used for all modes of transport as well as multi-modal. The seller considers
to have completed his obligation to deliver the goods when they are delivered to the
carrier, which is nominated by the buyer. Under this term the sellers obligation will be to
provide the goods of agreed quality along with necessary invoice and documents. The
seller must arrange at his own risk and cost necessary export permit or licence required
for export of goods. The delivery is regarded as completed if the named place is sellers
premises, when the goods have been loaded on the vehicle provided by the nominated
carrier. In other cases when the goods are placed or handed over at the disposal of the
said carrier.
The buyer must pay the price as agreed in the sales contract. He should also, if required,
arrange for necessary import licence or permit. The buyer will have to bear the expenses
of carriage from the named place. The buyer must take the delivery of the goods when
they have been delivered by the seller.
3.
In this term when the goods are placed alongside the vessel at the named port of shipment
it will be considered that the seller has completed the delivery. The buyer has to bear all
risks of loss or damage to the goods and all costs from this point of time. However, the
seller must clear the goods for the purpose of export. In the earlier INCO-terms it was
buyer to arrange for export clearance. This term can be used only for inland waterway
transport or shipment by sea. It is not used when it is air shipment. The seller must give
the goods commercial invoice in conformity with the contract of sale. The seller must
obtain at his own risks and expenses any export licence or other official authorization and
carry out, where applicable, all customs formalities necessary for the export of the goods.
The seller must place the goods alongside the vessel selected by the buyer at the loading
place. The seller must do so on the date or within the agreed period in the normal manner
in which it is done at the said port. Till such time the risk is on account of seller and
subsequently it is on buyer. The buyer obligations includes payment of the price,
obtaining import licence, all custom facilities for the import of the goods, contract of the
carriage and insurance. The buyer must take delivery when they have been given. The
risk commences when the goods are delivered. The seller must pay the cost of checking
quality, measuring, weighing and counting which are necessary for the purpose of
delivery of the goods. Seller should mark the packaging appropriately.
4.
This is the most popular term and is widely in use. FOB means that the seller delivers
when the goods pass the ships rail at the named port of shipment. Under this term the
buyer has to bear all costs and risk of loss of damage to the goods from that point. This
term requires the seller to clear the goods for exports. This term is used only for sea or
inland waterway transport. It is not suitable for shipment by air. The seller must provide
the goods and the commercial invoice, or its equivalent electronic message, in
conformity with the contract of sale and any other evidence of conformity which may be
required by the contract. The seller must obtain at his own risk and expense any export
licence or other official authorization and carry out, where applicable, all custom
formalities; the seller will have no obligation for carriage of insurance. He must deliver
the goods on the date or within the agreed period at the named port of the shipment until
that time the risk is with him.
5.
Earlier this term was popularly known as C& F or CNF. CFR means the seller must pay
the cost and the freight necessary for the goods to reach at the named destination.
However the risks of loss or damage to the goods after the time of the delivery is on
buyer account. The seller is required to clear the goods for exports. This term can be used
only for sea and inland waterway transport of goods. The seller has no obligation for
insurance the seller must deliver the goods on the data of shipment or within agreed
period on the board of the vessel at the port of shipment.
The buyer will arrange for necessary import licence at his own cost and risk. The buyer
will arrange to receive the goods and make necessary arrangement for clearance of the
goods by following necessary customer formalities.
6.
Cost insurance and Freight means that the seller delivers when the goods pass the
ships rail in the port of shipment. The CIF price refer that it covers the cost of the goods,
freight necessary to bring the goods to the named port of destination and also marine
insurance. Compared to the previous term CFR the seller contracts for the insurance
premium. It will be essential for the buyer to know that under the CIF term the seller is
required to obtain the insurance premium. It will be essential for the buyer to know that
under the CIF term the seller is required to obtain the insurance only on minimum cover.
If the buyer wishes to have more protection then he should make his own insurance
arrangement extra or should specify to the seller at the time of contract.
In this term the seller must clear the goods for exports and the buyer must arrange
necessary clearance for import. This term can be used only for sea and inland water
transport.
Under this term sellers obligation is to provide goods in conformity with the contract. He
has to arrange for necessary export licence, if required. All customs formalities necessary
for exports of goods should be completed by the exporter. The exporter must contract for
carriage and insurance on usual terms and bear the cost thereof. If subsequent carriers are
used for the carriage of the agreed destination the risk passes when the goods have been
delivered to the first carrier. This term is used for any mode of transport including
multimode transport.
Under this term the seller must provide the goods and the commercial invoice, arrange
for export licence, arrange for contract of carriage and also arrange for clearance of the
goods for the export.
The buyers obligation includes payment of the price, arranging import licence, necessary
formalities for clearance of goods and take delivery of goods.
7.
Carriage Paid To means the seller delivers the goods to the carrier nominated by him
but the seller must in addition pay the cost of carriage necessary to bring the goods to the
named destination. This refers to the fact that all the risks and any other cost occurring
after the goods have been delivered will be on buyers account. This term is used for all
modes of transport including multi-modal transport.
Carrier means any person who, in a contract of carriage, undertakes to perform or to
procure the performance of transport, by rail, road, air, sea, inland waterway or by a
combination of such modes. If subsequent carriers are used for the carriage to the agreed
destination, the risk passes when the goods have been delivered to the first carrier. The
sellers obligation under this term refers to providing goods and commercial invoice.
Arrange for necessary export licence or authorization, complete the export formalities,
enter the contract of carriage. However contract of insurance is not covered under this
term as seller obligation.
The buyer on the other hand must pay for the price and also arrange for import licence
and customs clearance for import. The buyer should also arrange for taking necessary
delivery.
8.
Carriage and Insurance Paid To means that the seller delivers the goods to the carrier
nominated by him, but the seller must in addition pay the cost of carriage necessary to
bring the goods to the named destination. This means that the buyer bears all risks and
any additional costs occurring after the goods have been so delivered. However, in CIP
the seller also has to procure insurance against the buyers risks of loss of or damage to
the goods during the carriage.
Consequently, the seller contracts for insurance premium. However the seller is required
to obtain insurance only on minimum cover. If the buyer desires to have greater
protection then he should go for additional insurance or expressly make necessary
arrangement and bear the cost for the same. This term is used in all types of transport
including multi-modal.
The carrier is defined as a person who, in a contract of carriage, undertakes to perform or
to procure the performance of transport, or in combination of more than one mode of
transport.
The sellers obligation under this term refers to providing the goods and commercial
invoice, arrange for necessary export licence and to provide for carriage & insurance. The
seller must deliver the goods to the carrier contracted. The buyer must pay the price and
arrange for import licence. He should comply with customs formalities for the import of
the goods. He must take the delivery. There is no responsibility for contract of carriage or
insurance.
9.
This term is used when goods are to be delivered at land frontier, irrespective of the mode
of transport. Delivered At Frontier means when the goods are placed at the disposal of
the buyer on the arriving means of transport not unloaded, cleared for import at the
named point and place at the frontier, but before the customs border of the adjoining
country.
When delivery is to take place in the port of destination, on board a vessel or on the quay
(wharf), the DES or DEQ term should be used.
Under this term the sellers obligation includes providing the goods and the commercial
invoice, take necessary exports licence so that he can place the goods at buyers disposal.
He should also arrange customs formalities necessary for the export of the goods to the
named place of the delivery at the frontier and for their transit through any country. The
seller must contract at his own expenses for the named point. However he will not enter
into contract of insurance. The buyer must take the delivery when given properly and
arrange for necessary import licence, custom clearance for import and also pay for the
goods.
10.
Delivered Ex Ship means that the seller delivers when goods are place at the disposal
of the buyer on board ship not cleared for import at the named port of destination. In this
term all the cost and risk in bringing the goods to the named port of destination before
discharge is on seller. This term can be used only when the shipment is by sea or inland
waterway or multi-modal transport in the vessel at the port of destination.
Under this term the sellers obligation is to provide the goods, arrange for the licence,
enter into contract of carriage. However the seller is not expected to cover the insurance.
The seller must place the goods at the disposal of the buyer on board the vessel at the
unloading point which is the named port of destination on the date or within the agreed
period in such a way as to unable them to be removed from the vessel by unloading.
On the other hand the buyer must pay the price, arrange for import licence, customs
clearance for import and take the delivery. In this case the buyer must bear all risk of loss
of or damage to the goods from the time they have been delivered.
11.
Delivered Ex Quay means that the seller delivers when the goods are placed at the
disposal of the buyer not cleared for import on the quay (wharf) at the named port of
destination. The seller has to bear costs and risks involved in bringing the goods to the
named port of destination and discharging the goods on the quay (wharf). The DEQ term
requires the buyer to clear the goods for import and to pay for all formalities, duties, taxes
and other charges upon import.
This is a reversal from previous INCO-terms versions, which required the seller to
arrange for import clearance. If the parties wish to include in the sellers obligations all or
part of the costs payable upon import of the goods, this should be made clear by adding
explicit wording to this effect in the contract of sale. This term can be used only when the
goods are to be delivered by sea or inland waterway or multi-modal transport on
discharging from a vessel onto the quay (wharf) in the port of destination. However if the
parties wish to include in the sellers obligations the risks & costs of the handling of the
goods from the quay to another place (warehouse, terminal, transport station, etc) in or
outside the port, the DDU or DDP terms should be used. The sellers obligation includes
providing goods and commercial invoice, arrange for necessary licence for export if any,
and enter into contract of the carriage of the goods to the named quay (wharf) at the
named port of destination. Under this term the seller must place the goods at the disposal
of buyer on the quay (wharf) on the date or within agreed period.
The buyers obligation refers to the payment of price arranging for import clearance by
completing customs formalities and also imports licence if any. The buyer must take the
delivery of the goods as per the terms.
12.
Delivered Duty Unpaid means that the seller delivers the goods to the buyer, not
cleared for import, and not unloaded from any arriving means of transport at the named
place of destination. The seller has to bear the costs and risks involved in bringing the
goods thereto other than where applicable any duty for import in the country of
destination. Such duty has to be borne by the buyer as well as any costs and risks caused
by his failure to clear the goods for import in time.
The word duty includes all or any customs duties, taxes and other similar charges to be
borne. This term may be used irrespective of the mode of transport but when delivery is
to take place in the port of destination on board the vessel or on the quay (wharf), the
DES or DEQ terms should be used.
The sellers obligation in this case is to provide the goods and commercial invoice,
arrange for export licence and arrange for export formalities. He should undertake
contract of carriage.
The seller must place the goods at the disposal of the buyer or at that of another person
named by the buyer, on any arranging means of transport not unloaded, at the named
place of destination on the date or within the period agreed for delivery. The buyers
obligation is to pay the price for the goods, arrange for import licence, custom clearance
for import and take the delivery.
13.
Delivered Duty Paid means that the seller delivers the goods to the buyer, cleared for
import, and not unloaded from any arriving means of transport at the named place of
destination. The seller has to bear all the costs and risks involved in bringing the goods
thereto including, where applicable, any duty for import in the country of destination.
As EXW represent the least obligation for the seller, DDP represent the least obligation
for the seller. The seller should not enter into DDP term if he is unable to procure
necessary import licence. Under this term the import clearance is sellers responsibility
and its need to arrange for customs clearance for import as well as exports. This term
may be used irrespective of the mode of transport but when delivery is to take place in
the port of destination on board the vessel or on the quay (wharf) the DES or DEQ terms
should be used.
Sellers obligation includes providing the goods and the commercial invoice arranging
for exports authorization, customs formalities for export contract for carriage. The seller
must place the goods at the disposal of the buyer, or at that of another person named by
the buyer, on any arriving means of transport not unloaded at the named place of
destination on the date or within the period agreed for delivery. The buyers obligation is
to pay the price and take the delivery of the goods.
Average freight rate assessment (AFRA)
Introduction
AFRA and its Terms of Reference was originally laid down and sponsored by Shell and
subsequently BP for their internal use.
In 1982, shell and BP stopped sponsoring it.
It is now compiled by the London Tanker Brokers Panel and is based on information
relating to transport agreements supplied by various oil companies and also from all
known fixtures concluded on the open market.
Recognized by tax authorities in many countries for pricing of intra-company oil
movements.
Principle
To establish an average transportation cost per ton in a given month for vessel in different
size categories.
To represents the cost of all chartered tonnage actually operating in the month being
assessed, irrespective of when the vessel was fixed.
Fixtures concluded during the period of assessment will not affect the result unless such
vessel is actually performing a voyage during the assessment month.
Who uses AFRA and why?
It removes the variable factors in shipping costs so that the rate paid by the affiliate
reflects the cost of chartered tonnage operating in the month being calculated.
It takes into account transport costs on a worldwide basis including spot market factor for
that month.
It is also used for transactions between oil traders and also by government bodies.
AFRA rate DWT categories
General purpose 16,500/24,000
Medium range 25,000/44,999
Large range 1 45,000/79,999
Large range 2 80,000/159,999
VLCC 160,000/319,999
ULCC 320,000/549,999
Vessels not included in the assessment
Government-owned vessels except when on commercial charter
Vessels employed in specialized trades such as the carriage of clean oils, petrochemicals,
lube oils, bitumen, etc.
Vessels employed in protected trades such as the U.S. Jones Act trade.
Components in each size category
Company vessels.
Vessels on long term charter (>18 months)
Vessels on short term charter (<18 months)
Vessels on single voyage charter
The mechanics of AFRA
The calculations are made for the period from the 16th of a month to the 15th of the next
month, both dates inclusive. It is the weighted average of commercially chartered tonnage
as employed in the international transport of oil during the period considered.
Vessels fixtures for each of the above four vessel categories are supplied by member
companies who use AFRA and from report of fixtures concluded on the market for
loading in the period under assessment.
This is why when looking at fixture reports you may see a VLCC fixing at WS 60 whilst
a product tanker is fixed at WS 200, the cost per tonne of cargo moved on a VLCC is
much lower than the cost per tonne of cargo moved on a product tanker, thus the product
tanker will attract a higher WORLDSCALE percentage. Prudent owners will be aware of
any distortions their particular vessel specifications and the state of the market may cause
and will adjust their figures accordingly.
The new worldwide tanker nominal freight scale (WORLDSCALE) is intended merely as
a standard of reference to assist subscribers to conduct business.
The responsibility of the associations is limited to providing subscribers with rates for
voyages calculated in accordance with the basis of a calculation and to revising
WORLDSCALE from time to time.
The nominal rate for a voyage does not in itself have any significance as representing a
fair or reasonable rate for the standard vessel or any other size and/or type of vessel at
any particular time.
Market levels of freight are to be expressed in terms of a percentage of the nominal
freight rate. Thus WORLDSCALE 100 would mean the rate for the voyage in question as
calculated and issued by the associations, while WORLDSCALE 175 would mean 175
per cent of that rate and WORLDSCALE 75 would mean 75 per cent of that rate.
Rates are calculated and quoted only in USD per tonne. However, freight may of course
by payable in any currency and the contracting parties should specify clearly the currency
of payment and the method to be used to determine the rate of exchange to apply if the
currency of payment is to be other than USD.
Basis of calculation
All rate calculations, which are made in USD, are per tonne for a full cargo for the
standard vessel based upon a round voyage from loading port or ports to discharging port
or ports and return to first loading port using the under-mentioned factors.
All of the factors shown are purely nominal and for rate calculation purposes only. In
particular, the fixed hire element of USD 12,000 per day is not intended to represent an
actual level of operating costs, nor to produce rates providing a certain level of income or
margin of profit, either for the standard vessel or for any other vessel under any flag.
Standard vessel
Total capacity
75,000 tonnes
(i.e. the vessels capacity for cargo plus stores, water, and bunkers, both voyage and
reserve; also see section 5 (2) of part A of the preamble).
Average service speed
14.5 knots
In port
380 cst
This price represents the average worldwide bunker price for fuel oil (380 cst) during the
period 1st October 1999 to 30th September 2000 as assessed by Cockett marine oil limited
(of London)
(e) Port costs
Port costs used are those assessed by the associations in the light of information available
to them up to the end of September 2000, the rate of exchange used for converting costs
in a local currency to USD being the average applicable during September 2000.
(f) Canal transit time
24 hours is allowed for each transit of the Panama canal.
30 hours is allowed for each transit of the Suez Canal.
Mileage is not taken into account in either case.
Notes on calculations
It is assumed that the standard vessel is able to navigate the selected route to reach and
load or discharge at the ports concerned. See section 6 of part A of the Preamble for a
description of the route policy.
The port time is deemed to include the Laytime of 72 hours.
Rates are calculated for voyages with loading and discharging ports in whatever order is
requested, irrespective of whether that order is consistent with the principle of
geographical rotation.
No allowance is made for any Tax on Freight or Income Tax, nor is there any provision
as to whether such Taxes are for owners or for Charters Account.
No allowance is made for any additional Marine Insurance on hull or machinery,
including War Risk insurance, which may be incurred when trading to or from certain
areas.
No allowance is made for deviation for any purpose whatsoever.
No allowance is made for any de-ballasting expenses, nor is there any provision as to
whether such costs are for Owners or Charters Account.
An unfortunate fact that the concept of WORLDSCALE points can not be carried over by
dry cargo operators for the following reasons:
Dry cargo carriers have multiplicity of trades and cargoes whereas the tankers carry oil
only.
Dry cargo ships are of several types and have variety of cargo handling gear. tankers on
the other hand have practically the same type of construction and all of them are fitted
with cargo handling pumps.
Vast variation exists in stowage factors of dry cargoes whereas the oil does not have
much different stowage factors therefore needing practically same sized (cubic capacity
wise) vessels for same weights of cargo.
Carriage of dry goods has several modes i.e. Bulk, Bags, Pallets, Drums, Bales and
containers whereas tankers carry oil in bulk only.
Dry cargo vessel have large variation in operational port stay (from few hours to
several weeks) whereas the tankers irrespective of their size require practically the same
operational port stay ranged between 18 to 36 hours usually.
Tankers have fewer loading and discharging locations the world over as specialised
arrangements have to be put in place before a tanker can discharge and on the other hand
a dry cargo vessel needs very little in the name of infrastructure and can discharge her
cargo just about anywhere.
Voyage estimation
Simulation 1
Vessel particulars:
Summer DWT 155,000 tonnes
Speed 14 knots, loaded and ballast
Fuel consumption @ sea 55 tonnes per day F.O., 2 tonnes per day D.O. @ each port 15
tonnes F.O., 2 tonnes D.O.
Constant 500 tonnes
Sag 1,000 tonnes
Bunkers ROB @ load port
F>O. 1,400 tonnes
D.O. 100 tonnes
Daily running cost $7,500
Proposed voyage:
A full cargo of crude oil, one safe loading port to one/two safe ports U.S. Gulf.
Intended voyage port Torres to Beaumont, Ts.
One way distance 5,544n. miles
Proposed rate WS 70
WS Flat rate $8.70
Bunkering Beaumont (F.O. $100/tonnes; D.O. $165/Tonne)
Port costs
Porto Torres $20,000
Beaumont $ 30,000
Port stay Ws conditions (2 days to load, 2 days to discharge)
Methodology - 4 steps involved
Calculate:
Voyage time
Voyage costs
Cargo that can be loaded
Daily return and daily profit
Sensitivity analysis
Voyage time calculation
Steaming time = (5544x2)/ (14x24) = 33 days
Port stay = 4 days
Total = 37 days
and competed at Noon on 26th May. Demurrage at $4,000 per day and pro rata of a day
and Despatch at $2,000 per day and pro rata for part of a day.
Prepare a Laytime statement and calculate the amount due to the ship owner or chartered
if the Laytime is reversible.
Solution
9,000
Laytime
= 1,500
9,000
= 6 days
SHEX (loading)
Laytime
Laytime
= 1,000
= NOR + 24
= 9 days
SHEX (disch)
14/5 (Tue)
0800: NOR
15/5
1800:comd disch
1/5 (wed)
1400:Ldg comptd
26/5
1200:comptd
discharge
Date
Remarks
Thurs
25/4
0900:
NOR
1300:Ldg comd
1600
to1800:
rain
0900 LT starts
F.T.C.
N.T.C.
N.T.C.
F.T.C.
1400
Ldg
comptd
0800 NOR
0800
L.T.
commences
1800
disch.
Commences
F.T.C.
F.T.C.
F.T.C.
Fri
Sat
Sun
Mon
Tue
Wed
26/4
27/4
27/4
28/4
30/4
1/5
Tue
Wed
14/5
15/5
Thurs
Fri
Sat
16/5
17
18
Time
count
to Total
Demurrage/Despatch
time to
count
-
15h
1d
0
1d
1d
14h
15h
2d 15h
1d 15h
2d 15h
3d 15h
4d 05h
0
16h
4d 05h
4d 05h
1d
1d
1d
5d 21h
6d 21h
7d 21h
Sun
Mon
Tue
Wed
Thur
Fri
Sat
Sun
19
20
21
22
23
24
25
27th
Mon
Tues
28th
28th
N.T.C.
F.T.C
F.T.C.
F.T.C.
F.T.C.
F.T.C.
F.T.C.
1200
comptd
discharge
F.T.C.
L.T. finishes
0
1d
1d
1d
1d
1d
1d
0h
7d 21h
8d 21h
9d 21h
10d 21h
11d 21h
12d 21h
13d 21h
13d 21h
12h
1d
3h
14d 21h
15d
1d
3h
Despatch = 1d 15h
Money due = 2000 x 1.625 = 3250 $
Example Question 2
Q2.
A tanker has 23,400 tonnes of oil to load and discharge in 172 running hours.
Bunkering time is excluded. Lay hours to commence 6 hours after N.O.R. is accepted.
N.O.R. was accepted at the load port at 1200 hrs on Friday the 4th of May. Work ceased
while bunkering from 0730 hrs to 1230hrs on the 7th May. Loading finished at 1600 hrs
on the 8th May. N.O.R. was accepted at the discharge port at 1500 hrs on the 18th May
and discharging was completed at 1830 hrs on the 22nd of May. The demurrage rate is
750/ day of pro-rata. Despatch money is not payable. Freight is due at 3.90 per tonne less
4% insurance. Calculate the amount due to the ship on completion of discharge.
Solution
Tanker has
23,400t to load & discharge = 172 running his bunkering time excluded
Lay time commence
= NOR +6 hrs
Load port
Friday
8th May 23, 2003
4/may 7th May
1200 NOR accepted 0780N 1230: bunker
1600: completed loading
Discharge port
16 May 22 may
1500: NOR 1830 completed
Day
Date
Details
Loading Friday
4th may
1200 NOR
1800 lay time 6
begins
Full day to 24
count
Full day to count
24
Sat
5th may
Sun
6th may
Day
Date
Mon
7th may
Tues
8th may
Details
For discharging
Fri
Sat
19th may
Sun
Day
20th may
Date
Mon
Tues
21st may
22nd may
Demurrage
92
116
140
Total
count
164
182.5
hrs
to
= 10.5 hrs
750
= 24 x 10.5
= 23, 400 x 3.90
Demurrage rate
Freight due
Less 4%
Amount due to the ship
= 328.125 $
= 91260 $
= 3650.4 $
= (91260-3650.4) + 328.125 = 87937.725 $.
Example Question 3
Q3.
A charter- party provides for Laytime for loading 6 days, Laytime for discharging
3 days and Laytime not to count from noon Saturday until midnight Sunday even if used.
Demurrage at $3,500/- per day or pro-rata. Despatch at half demurrage rate on all time
saved. At load port Lay time commenced at 1200 on Monday 25 November and loading
completed at 1200 on Friday 29 November.
At discharging port Laytime commenced at 1200 on Thursday 12 December and
discharging completed at 2400 hrs on Thursday 19 December.
Prepare a Laytime statement and calculate the demurrage/despatch, and the net amount
payable to owners/charterers on (I) Normal basis and (II) Averaging basis.
Solution
Lay time for loading
6 days X 24
144 hrs
Demurrage
Dispatch
demurrage
Monday
Friday
25/11
29/11
Day
Date
Details
Hrs to count
Mon
25/11
12
Tues
26/11
24
36
Wed
27/11
24
60
Thur
28/11
24
84
Fri
29/11
Total
count
12
12
96
Day
Date
Thur
12/12
Fri
13/12
Sat
14/12
Sun
Mon
15/12
16/12
Tues
17/12
Wed
18/12
Thur
19/12
Demurrage = 72 hrs.
48hrs + 36 = 84hrs
Hrs to count
Total
count
1200: lay time 12
12
commenced
Full day to 24
36
count
UPTO 1200 : 12
48
Laytime
to
count
N.T.C.
Full day to 24
72
count
Full day to 24
96
count
Full day to 24
120
count
2400 completed 24
144
discharge
hrs
to
hrs
to
Normal basis
84x3500x1
Despatch
24
= 6125
72 x 3500
Demurrage
= 24
= 10500
Net amount payable to owner = 10500-6125 = 4375$
Averaging basis
= 84 72 = 12 hrs dispatch
Example question 4
Prepare a lay time statement on the basis of the following particulars and find the amount
of demurrage/despatch:
9240t of sugar in bags are to be discharged at the rate of 720t per weather working day of
24 hours, Sundays and holidays excepted. Laydays to start 24 hours after receipt of
Notice of Readiness.
Demurrage @ $700/- per day and pro rata for part of day. Despatch at half the rate of
demurrage for all time saved.
Vessel arrived and berthed at 0720h on Monday 21st February. Discharging commenced
at 0930h on 21st February, and completed at 1145h on Monday 28th February.
Discharging was interrupted as follows:
Rain from
0800h to 0900h on 22nd February.
Rain from
0800h to 0930h on 23rd February.
Winch breakdown at No.4 hatch from
0800h to 1000h on 24th February.
Vessel has four hatches.
Rain from
0800h to 1000h on 25th February.
Wednesday, March 1 was a public holiday.
Solution
9240
Lay time = ..= 12D 20H
720
= 320 H
21st Feb
Mon
berth-0720
22feb
23feb
24feb
25feb
0800-0900
0800-930
0800-1000
0800-1000
rain
# 4 breakdown
NOR-0720/21 rain
L.T. 0720/22
rain
0830-disch comptd
28th Feb.
Holiday
Date Day
21 Feb
Details
Mon 0720: Beth, NOR recd
0830: dispatch
Hrs.
-
22 Feb
Tue
15 40 00 15 40
23 Feb.
Wed
0800-0930: rain
22 30 00 38 10
24 Feb
Thur
0800-1000: # 4 breakdown
22 00
60 10
25 Feb
Fri
0800-1000: rain
22 00
82 10
26 Feb
27 Feb
28 Feb
Sat
Sun
Mon
24 00
- 11 45
106 10
106 10
117 55
29 Feb
Tue
F.T.C.
N.T.C.
F.T.C.
1145-compted discharge
F.T.C
24 00
Total hrs.
-
Demurrage
Despatch.
wherever a person may benefit or lose by reason of the existence of the insured
thing. The law however does provide - a person must stand in a legal or equitable
relationship to the property insured, and this direct relationship must cause him
profit or loss according to whether or not the thing survives.
Charterers
Apart from owners, many other parties may have a stake in the use and operation of
ships. One of the most common relationships is that of charterer and the question
therefore arises whether charterers have an insurable interest in the ship they charter.
In the case of demise charterers it seems clear that the charterer has at least a
possessor interest in the ship which would give him the right to insure. Indeed,
standard demise charter agreements can require charterers to keep the vessel insured
to protect the interests of both owners and charterers.
Under time and voyage charters, however, the charterers' interest in the hull extends
only to the potential liability, which may arise if the ship is damaged through
obeying the charterers' orders. While such liability is clearly not an interest in the
way of property, the modern view is that it is sufficient 'to have a right in the thing
insured, or to have a right or be under a liability arising out of some contract relating
to the thing insured'. In many instances it will be obvious that charterers will benefit
from the preservation of the ship or suffer prejudice from its destruction and that
they should be able to demonstrate an insurable interest makes good commercial
sense.
Mortgages
It is clear that a mortgager of the subject matter has an insurable interest and may
insure up to the full value of the ship but can only recover under the policy to the
extent of the mortgage debt.
Trustees
If a ship is held in trust, the trustee alone is regarded as having a legal interest and as
such may insure the full value of the property, which is the subject of the trust.
The Adventure
A person who has no insurable interest in the ship as such may nevertheless be able
to insure the adventure on which she is engaged. Thus a person might be interested
financially in the undertaking of laying an Atlantic cable without having any interest
in either ship or cable as such. A shareholder in a limited company has only a legal
interest in his shares and not in the property, which it owns. However, it has been
held that where the company is engaged upon a business adventure such as the laying
of an Atlantic cable the shareholders have an insurable interest in that adventure.
Creditors
Whatever may be the case of the shareholder, a creditor has no such interest even
though he may know that the only chance of his loan being repaid is the successful
completion of a certain voyage. Nevertheless he will not be able to insure the
adventure, for he has a legal claim against the debtor whether or not profits are made.
Lien Holders
While creditors in general cannot show an insurable interest there is no doubt that a
creditor who holds a lien on maritime property has an interest to the extent of his lien.
The interest of the holder of a maritime lien will arise with the incident, which brings the
lien into being, for example a collision, or the completion of salvage services. However,
the interest of a creditor seeking a statutory right of arrest in rem cannot attach until, at
the earliest, when a writ is issued and possibly not until it is served.
is if but for the misrepresentation, the other party could not have been reasonably
expected to make the agreement. In general, only actual misrepresentations entitle
the innocent party to rescind the contract. On the other hand, failure to disclose a
material fact is, as a rule, unobjectionable. For example, if you wish to enter into a
service agreement, and on inquiry wrongfully, though innocently, say that you are
healthy the prospective employer may avoid the contract. On the other hand, if you
are not asked about your health and do not disclose that you are a carrier of germs,
the employer has no right of rescission, however material this fact may have been in
his decision whether to employ you.
Contracts 'UBERRIMAE FIDEI'
The general rule may be sufficient for ordinary contracts, but it is certainly
unsatisfactory in certain cases where one party is peculiarly defenceless in case of the
non-disclosure of material matters. This rule has therefore been tightened, for
instance, in the law relating to limited companies, and it has always been more
stringent in the law of insurance. Insurance would obviously be impossible as a
genuine business unless the insurer could rely upon having knowledge of all the
matters known to the prospective assured and which enable him to calculate carefully
the probable incidence of the risk.
Non-Disclosure
A person who is about to effect a policy must therefore not only make no active
misrepresentations, but must also disclose to the insurer every material circumstance,
that is, everything which 'would influence the judgment of a prudent insurer in fixing
the premium, or determining whether he will take the risk'. Disclosure must be made
before the contract is made. As already explained, marine insurance business is
transacted in a somewhat informal manner, and it may be some time before the
policy is issued. For this reason, the moment at which the contract is actually
concluded has been the subject of some debate. It has therefore been provided that
the contract is deemed to have been concluded when the insurer has accepted the
proposal, and this is commonly proved by the slip bearing the insurer's initials.
Of course, in the ordinary way a person can only be expected to disclose facts which
he knows, but insurance business would be even riskier than it is if the prospective
assured were allowed to take shelter behind his bad memory or ignorance. In the eye
of the law a prospective assured is deemed to have knowledge of every circumstance
which, in the ordinary course of business, ought to be known by him'. Where an
agent, e.g. a Lloyd's broker, negotiates the policy, he must disclose to the insurer
every material circumstance that he should know in the ordinary course of his
business and all that ought to have been communicated to him by his principal.
However, if the assured hears of a material fact when it is too late to be
communicated to the agent before the risk is accepted then failure to disclose, will
not entitle the insurer to avoid the policy.
It should be noted that what in old cases is called concealment need not necessarily
mean that some material fact was deliberately or fraudulently suppressed.
Concealment there means simply what now is termed non-disclosure. In the modern
law fraudulent concealment gives, of course, also a right to avoid the policy. Besides,
the insurer may bring an action for deceit. While the law thus imposes a heavy
burden on the assured, this rule should not be unduly extended.
Some practical definitions
Who is an Insurance Broker?
Type of vessel (Oil Tanker, General cargo, Container vessel etc.) Oil tanker is
higher risk vessel of as compared to container vessel.
Name of builders and place of built
Age of vessel
Age of engine
Type of engine
Deadweight / GRT
Double hull
Other Details:
Classification society
Last surveyed
Port of registry
Flag of convenience
Nationality of crew
Trade liner/Tramp
Trading limits/area (warranty Limits)
Nature of Cargo usually carried
Claims experience of last 5 years (Premium and claims)
Claims ratio = Incurred Claims/Net premium
Type of cover required (Time or voyage)
Duration of cover or voyage particulars
Deductibles
Previous insurance history, whether cover was denied at any time
Vessel given on charter (Details)
Vessel covered against P & I risks
Assured
I. Interest
Disclosure
Risk
Particulars
Insurance
Broker
Making
of
Original
Slip
Lead
Underwrite
r
Following
the line
Other U/W
Initialling of
Slip by
Underwriter
Rate, %cover
Lloyds Policy
signing office
Completion
of Slip
Broker sends
Cover Note
Policy
Stamped &
issued
by Lloyds
On Payment
of Premium
Companies Policies: Combined policy form used (since 1939) for all subscribing
companies; prepared by broker; policy passed to Institute of London Underwriters for
checking & signing.
Example of India
Hull and machinery insurance in India is obtained directly from head office of one of the
following national insurance company:
UK P & I CLUB
NORTH OF ENGLAND P & I CLUB
WEST OF ENGLAND P & I CLUB
Swedish Club
GAARD
Fines
Inquiries and criminal proceedings
Liabilities and expenses incurred by direction of the Managers
Sue and labour and legal costs
What are the members (Masters) obligations with regard to claims under P & I
club?
A member must promptly notify the Managers of every casualty, event or claim
upon him, which is liable to give rise to a claim upon the Association, and of
every event or matter which is liable to cause the members to incur liabilities,
costs or expenses for which he may be insured by the Association.
A member must promptly notify the Managers of every surveyor opportunity for
survey in connection with a matter, which is liable to give rise to a claim.
A member must at all times promptly notify the Managers of any information,
documents or reports in his or his agents' possession, power or knowledge
relevant to such casualty, event or matter as is referred to under (i) and shall
further, whenever so requested by the Managers, promptly produce to the
Association and/or allow the Association or its agents to inspect, copy or
photograph, all relevant documents of whatsoever nature in his or his agents'
possession or power.
Member shall permit the Association or its agents to interview any servant, agent
or other person who may have been employed by the Owner at the material time
or at any time thereafter or whom the Association may consider likely to have any
direct or indirect knowledge of the matter or who may have been under a duty at
any time to report to the Owner in connection therewith.
A member shall not settle or admit liability for any claim for which the
Association may insure him without prior written consent of the Managers.
In the event that a member commits any breach of his obligations above, the
Directors may in their discretion reject any claim by the Owner against the
Association arising out of the casualty, event or matter, or reduce the sum payable
by the Association in respect thereof by such amount as they may determine.
Time Bar for claims
A member fails to notify the Managers of any casualty, event or claim within one
year after he has knowledge thereof; or
A member fails to submit a claim to the Managers for reimbursement of any
liabilities, costs or expenses within one year after discharging or settling the same
A member claim against the Association shall be discharged and the Association
shall be under no further liability in respect thereof unless the Directors in their
discretion shall otherwise determine
Hull and Machinery Coverage
The purpose of the Hull and Machinery Coverage
The main purpose of the Hull and Machinery cover is to provide the ship-owner with an
expectation of status quo regarding a vessels operational ability during a maritime
enterprise. Since marine perils are a risk that the ship-owner assumes at each venture, the
ship-owner takes out Hull Cover to protect against losses that may occur to the vessel and
her equipment during the enterprise.
Coverage concerns The English Institute Time Clauses Hulls (ITCH) have forms for
years 1983 and 1995 (1/11/95). However, the 1983 Form is the more widely followed
document.
Hull & Machinery insurance based on ITCH covers all risks subject to the normal
exclusions for wear and tear and similar causes such as lack of maintenance.
Furthermore, war risks, intervention by a state power, insolvency and nuclear perils are
also excluded. Damage to parts that are defective due to error in design or faulty material
is also covered. The Plan covers 4/4ths collision liability and liability which is a result of
striking fixed and floating objects (RDC- Running Down Clause and FFO-Fixed and
Floating Objects) while the ITCH covers 3/4ths RDC but not FFO and the American
Conditions cover 4/4ths collision liability but not FFO. The advantage of an all risks
system is that all causes of loss however unusual or unimaginable are covered unless the
insurer can establish that a specific exclusion applies.
The ITCH and the American Conditions provide cover on a named perils basis (the
Assured must prove that the loss or damage was caused by one of the insured perils), but
are usually supplemented by an Additional Perils clause. With this clause added the
ITCH and American Conditions will cover nearly all losses that might arise in practice
and which are covered by the Plan. An exception to this is that under the Additional
Perils clause 2 the cost of repairing or replacing any part that is defective due to error in
design or construction is excluded unless the defect has caused consequential damage or
the costs can be defined as a cost listed in clause 1 of the Additional Perils clause. There
is no equivalent restriction in the Plan 12-4. On the other hand the Plan contains specific
rules excluding losses arising from lack of maintenance, which are probably more
stringent than the rules that follow from MIA (the Marine Insurance Act) section 55 and
English case law. The relationship between the cover for "perils of the sea" and the
exclusion of wear and tear in MIA S.55 has caused considerable discussion particularly in
connection with the decision in the Miss Jay Jay case.
The recent English Court of Appeal decision in the "Nukila" case seems to expand cover
under clause.6.2. of the ITCH compared to the traditional view in that any damage
occurring during the policy period as a result of any latent defect is covered. If the term
latent defect includes an error in design and is not excluded by the exclusion for inherent
vice in MIA S.55 then the cover under 6.2 for loss caused by latent defects appears to be
equivalent to that provided by the Plan. This means that the Additional Perils clause
could provide less cover than the Inchmaree clause, clause 6.2 in this type of situation.
Under the Plan ( 12-2) the assured cannot claim compensation for un-repaired damage
unless ownership of the vessel has passed from the assured (normally by sale). Under
ITCH (Clause 18) the assured may claim for un-repaired damage at the termination of the
policy (but not in the event of a subsequent total loss sustained during the policy period).
In relation to temporary repairs, and costs incurred in expediting repairs the Plan ( 12-7
and 12-8) provides coverage for extra expenses incurred in order for the assured to save
(costs and) time, with certain limitations. Under British law there is no similar provision
and the insurer is liable for reasonable cost of repairs, which normally is the cheapest
repair alternative.
It is important to be aware of the nuances and exclusions from Hull coverage as well as to
be aware of coverage options and requirements. For instance, although the ship,
equipment and spare parts are covered by the Hull insurance, loose items that accompany
the ship in its trade, but which cannot be deemed to be a part of it, e.g. stores and supplies
are covered under the ITCH, but not under the Plan. As a result, the ship-owner may
consider purchasing additional insurance coverage for items falling outside of the Plans
coverage provisions. However, many times, the loss and/or damage of such items fall
well below the deductible amount. Therefore, an individual assessment should be made.
Another important consideration is coverage of items that are not normally on board the
ship for an indefinite or prolonged period of time. The Plans prerequisite for covering
equipment and spare parts under the Hull coverage is that they are normally on board.
According to the Plan, actual ownership is irrelevant so long as there is a transfer of
liability of risk. Accordingly the ship-owner does not have to take out a separate property
insurance for equipment that he does not own, but for which he carries the risk. Of
interest is the Plans coverage of third party interests, which now includes spare parts
unlike the coverage terms in the Plan of 1964.
ITCH has to be supplemented by the Leased Equipment Clause 1/11/95) in order to
provide the assured with this type of coverage. There is, however, an important
reservation in that the liability of the insurers shall not exceed the assured contractual
liability for the leased equipment, or its replacement value. This means that, when
examining any claim involving leased equipment, it will be essential to call for the
contract of hire in order to ascertain what the assured contractual liability is.
Items that are temporarily removed from the ship is another area worth focusing upon.
The Hull cover becomes applicable in connection with loading and discharging, routine
overhauling of special equipment and when machinery or equipment is sent to special
repair yards. The prerequisite for cover under 10-2 of the Plan is that the relevant object
has been on board and that the intention is to put it back on board before departure.
(Thus, new equipment on its way from the manufacturer to the ship is not covered by the
hull insurance.) ITCH has to be supplemented by the Parts Removed Clause (1/11/95).
Cover is limited to 30 days whilst removed. Period in excess of 30 days is held covered at
terms to be agreed provided notice is given to insurers prior to the expiry of the 30-day
extension.
Furthermore, the Plan provides for the additional condition that objects are removed in
connection with the operation of the ship or due to situations such as repair or rebuilding.
Items such as forklift trucks and other objects accompanying the ship will have to be
indemnified by the hull insurer if they are damaged while ashore in connection with
loading or discharging. It is important that the ship-owner is aware of the absolute
condition that the objects removed from the ship are intended to be brought back on
board before departure from the port in question. ITCH has to be supplemented by the
Parts removed Clause (1/11/95), see the previous section.
If the interest covered by the insurance is mortgaged, the Plan provides coverage also for
the mortgagee interest in other words the mortgagee is automatically co-insured , which
is not the case with other third parties. Under ITCH the mortgagee has to require the
mortgagor ship-owner to assign the hull policies in his favour. This is frequently achieved
by endorsements on the ship-owners policies noting the interest of the mortgagee.
Timing of Insurance
The standard coverage normally run for a period of 12 months and need to be
renegotiated at each renewal. Coverage for new equipment and spare parts commences
from the time the object concerned is "swung over the railing" to be placed onboard ship.
The ship-owner should also be aware of the situations where coverage can be denied or
reduced:
Un-seaworthiness
The insurer is not liable for a loss that is a consequence of the ship not being in a
seaworthy condition. A prerequisite is that the assured knew or ought to have known of
the ships defects at such a time that it would have been possible for him to intervene. In
respect of ITCH: For the insurer to avoid liability English law requires that the assured
should be privy to the un-seaworthiness. In other words, the assured must have
knowledge not only of the facts constituting the un-seaworthiness but also knowledge
that those facts rendered the ship un-seaworthy.
Intent
If the assured intentionally brings about the casualty, he has no claim against the insurer.
Gross negligence
Any liability of the insurer shall be determined based on the degree of fault and
circumstances generally.
Trading limits
The Plan 3-15 requires that the assured shall notify the insurer before the ship proceeds
beyond the ordinary trading limit. The ship may sail in the conditional trading areas,
subject to an additional premium and to any other conditions that might be invoked by
the insurer. If the ship proceeds into an excluded trading area the insurance ceases to be
in effect. The insurer can, however, give permission in advance. If the infringement was
not the result of an intentional act by the master of the ship the insurance is still in effect.
Under the ITCH the ship is held covered provided prompt notice is given. If notice is not
given the assured will be unable to recover anything if loss or damage occurs while the
ship is outside the ordinary trading limits.
that it is in line with general principles of both English and American law. In reality the
courts will have to evaluate each case to decide whether the person at fault has had the
kind of authority that justifies that his actions are identified as the actions of the Assured.
a) Time Lines:
The letter of credit should have an expiration date that gives sufficient time to the seller
to get all the tasks specified and the documents required in the LC. If the letter of credit
expires, the seller is left with no protection. Most LC s fail because
Sellers/Exporters/Beneficiaries were unable to perform within the specified time frame in
the LC. Three dates are of importance in an LC:
i) The date by when shipment should have occurred. The date on the Bill of Lading.
ii) The date by when documents have to be presented to the Bank
iii) The expiry date of the LC itself.
A good source to give you an idea of the timelines would be your freight forwarding
agent. As a seller check with your freight forwarding agent to see if you would be in a
position to comply.
c) Compliance with the Documents and Conditions within the Letter of Credit
Letters of credit are about documents and not facts; the inability to produce a given
document at the right time will nullify the letter of credit. As a
Seller/Exporter/Beneficiary you should try and run the compliance issues with the
various department or individuals involved within your organization to see if compliance
would be a problem. And if so, have the LC amended before shipping the goods.
5.
6.
7.
Y.A. 1994
Rule paramount In no case shall there be any allowance for sacrifice or expenditure
unless reasonably made or incurred.
Order of application: Rule paramount, numbered rules, lettered rules (Interpretation
rule)
There is a common maritime adventure when one or more vessels are towing
or pushing another vessel or vessels, provided that they are all involved in
commercial activities and not in a salvage operation. (Rule B)
Pollution liability is of the ship-owner and not GA: In no case shall there be any
allowance in general average for losses, damages or expenses incurred in respect of
damage to the environment or in consequence of the escape or release of pollutant
substances from the property involved in the common maritime adventure. (Rule
C)
All parties claiming in general average shall give notice in writing to the average
adjuster of the loss or expense in respect of which they claim contribution within
12 months of the date of the termination of the common maritime adventure
otherwise an Adjuster does adjustment on basis of facts available to him. (Rule E)
After G.A. if cargo is forwarded to the destination from P.O.R : the rights and
liabilities in general average shall remain as nearly as possible the same as they
would have been in the absence of such forwarding. (Rule G)
When a ship is intentionally run on shore for the common safety, whether or not
she might have been driven on shore, the consequent loss or damage to the
property involved in the common maritime adventure shall be allowed in general
average. (Rule V)
Y. A. 1974
No rule Paramount (Reasonable)
Order of application: Numbered rules then
lettered rules (Interpretation rule)
No mention of towing, pushing vessels or
salvage operations
Pollution Liability is not mentioned in these
rules.
No such requirement
No such provision
When a ship is intentionally run on shore for
the common safety, whether or not she might
have been driven on shore, the consequent
loss or damage shall be allowed in general
average. (Could have included damage to the
third party)
Y.A. 1994
8. Salvage Award as fixed per criteria in article 13 of ISC 89( including the criteria
the skill and efforts of the salvers in preventing or minimising damage to the
environment, to be allowed as G.A.
9. Special compensation payable to a salver by the ship-owner under Article 14 ISC
89 or under any other provision similar in substance shall not be allowed in general
average. (Rule VI)
10. Cargo, ship's materials and stores, or any of them, necessarily used for fuel for the
common safety at a time of peril shall be admitted as general average. (Rule VIII)
Y.A. 1974
Was silent as there was no such provision in
Earlier salvage convention 1910.
Was silent as there was no such provision in
Earlier salvage convention 1910.
Y.A. 1994
14. Interest shall be allowed on expenditure, sacrifices and allowances in general
average at the rate of 7 per cent. per annum, until three months after the date of
issue of the general average adjustment, due allowance being made for any
payment on account by the contributory interests or from the general average
deposit fund.
Y.A. 1974
Interest shall be allowed on expenditure,
sacrifices and allowances charged to general
average at the rate of seven per cent per
annum, until the date of the general average
statement, due allowance being made for any
interim reimbursement from the contributory
interests or from the general average deposit
fund.
understand. Also, in line with recent changes to court procedures, the new rules give
arbitrators greater powers to control proceedings including, for example, the power to
place limitations on expert evidence to contain costs.
SCOPIC is drafted so that it can be incorporated into a Lloyd's Open Form if the
parties to that contract so desire. It is not intended to be compulsory.
2.
Members of the International Group of P & I Clubs, who have agreed a Code of
Conduct giving Club backing to its provisions, have accepted the provisions of
SCOPIC.
P & I Clubs are normally not parties to a salvage contract and, therefore, cannot be
bound by a new clause to an LOF contract. However, the Code of Conduct will
apply whenever a member of the ISU salves a ship entered with a member of the
International Group. In individual cases, the Code can be extended to other salvers
or Clubs, but that will be a matter between them and the particular Club concerned.
3.
SCOPIC does not do away with Special Compensation as we know it, but merely
replaces its method of assessment.
Special Compensation (SCOPIC remuneration) will continue to be paid only to the
extent that its assessment exceeds any Article 13 award.
4.
5.
As soon as the SCOPIC remuneration provisions are invoked, the owner must
provide, within two working days, a guarantee for USD 3 million.
The security of USD 3 million must be lodged regardless of the total amount of
SCOPIC remuneration that may be payable. There are provisions for reducing or
increasing the figure at the termination of the services. The Clubs have agreed, in
the Code of Conduct, to provide security on behalf of an entered member, unless
there is a defence to any claim he may have. If this guarantee is not provided, the
contractor, at his option, can withdraw his notice invoking the SCOPIC provisions
and revert to the Lloyd's Form as if it had not incorporated SCOPIC.
6.
SCOPIC remuneration is assessed in accordance with tariff rates. Tariff rates have
been agreed for tugs of differing horsepower, together with personnel and
equipment likely to be used in a salvage operation. The tariff rates are profitable
rates. A fairly broad brush had to be used in setting up the tariffs and it is intended
that they should do rough justice. A standard uplift of 25% of the tariff rates will
be added. The benefits of such a system are substantial and an enormous
improvement on past attempts to assess a "fair rate". It should be possible, by using
the tariff, to make a calculation at the end of each day of operation to gauge the
amount of SCOPIC remuneration that has accrued.
7.
In the event of the salvers invoking SCOPIC remuneration provisions and the
Article 13 award exceeding the assessment of SCOPIC remuneration, the Article
13 award will be discounted by 25% of the difference between the Article 13
award and the SCOPIC assessment. This provision has been inserted to encourage
the salver not to invoke the SCOPIC provisions in every case. The benefit of a
reduced Article 13 award accrues to the property underwriters.
8.
As soon as SCOPIC has been invoked, the ship-owner can appoint a Special
Casualty Representative (SCR), to monitor the salvage services and be kept fully
advised as to how the operation is to be carried out. The SCR will not in any way
impinge on the authority of the Salvage Master, who will always remain in overall
control and responsible for the operation. It will, however, be incumbent upon the
Salvage Master to keep the SCR fully advised and listen to his views. The Salvage
Master will be required to make daily reports and the SCR to either endorse those
reports, or make clear with what aspect he disagrees. The provision is particularly
important to the P & I Clubs, who have long felt that they have not been kept
sufficiently advised as to the progress of the salvage operations, which may
ultimately affect their interests.
9.
Once the SCOPIC remuneration provisions have been invoked, the whole Lloyd's
Form contract can be terminated (1) by the contractor, if the overall cost to him
less any SCOPIC remuneration is greater than the value of the property salved, and
(2) by the owner, after giving five days' notice to the contractor. These additional
rights to terminate the whole contract are important. From the contractor's point of
view, he will be able to do so as soon as it is clear that it is not in his financial
interest to continue. So far as the owner is concerned, he will have the power to
withdraw (once SCOPIC has been invoked) at any time after giving five days'
notice. This is particularly important to the Clubs, who wish to avoid being locked
into a contract carried out by someone who they feel is inappropriate. It should not
be of a major concern to salvers as it will only apply when SCOPIC has been
invoked, which, by its nature, is only likely to be when salvage - in its traditional
form - is no longer a reasonable commercial venture.
1.
The industrial revolution of the eighteenth and nineteenth centuries and the upsurge in
international commerce, which followed, resulted in the adoption of a number of
international treaties related to shipping, including safety. The subjects covered included
tonnage measurement, the prevention of collisions, signalling and others.
By the end of the nineteenth century suggestions had even been made for the creation of a
permanent international maritime body to deal with these and future measures. The plan
was not put into effect, but international co-operation continued in the twentieth century,
with the adoption of still more internationally developed treaties.
It was not until the establishment of the United Nations itself that these hopes were
realized. In 1948 an international conference in Geneva adopted a convention formally
establishing IMO (the original name was the Inter-Governmental Maritime Consultative
Organization, or IMCO, but the name was changed on 22nd May 1982 to IMO).
The IMO Convention entered into force in 1958 and the new Organization met for the
first time the following year.
MARPOL
But although safety was and remains IMO most important responsibility, a new problem
began to emerge - pollution. The growth in the amount of oil being transported by sea
and in the size of oil tankers was of particular concern and the Torrey Canyon disaster
of 1967, in which 120,000 tonnes of oil was spilled, demonstrated the scale of the
problem. Until then there was a general complacency that the vast oceans can withstand
the effects of pollution.
During the next few years IMO introduced a series of measures designed to prevent
tanker accidents and to minimize their consequences. It also tackled the environmental
threat caused by routine operations such as the cleaning of oil cargo tanks and the
disposal of engine room wastes - in tonnage terms a bigger menace than accidental
pollution.
The most important of all these measures was the International Convention for the
Prevention of Pollution from Ships, 1973, as modified by the Protocol of 1978 relating
thereto (MARPOL 73/78). It covers not only accidental and operational oil pollution but
also pollution by chemicals, goods in packaged form, sewage, garbage and air pollution.
Then, IMO was also given the task of establishing a system for providing compensation
to those who had suffered financially as a result of pollution. Two treaties were adopted,
in 1969 and 1971, which enabled victims of oil pollution to obtain compensation much
more simply and quickly than had been possible before. Both treaties were amended in
1992, and again in 2000, to increase the limits of compensation payable to victims of
pollution.
GMDSS
Shipping, like all of modern life, has seen many technological innovations and changes.
Some of these have presented challenges for the Organization and others have presented
opportunities. The enormous strides made in communications technology, for example,
have made it possible for IMO to introduce major improvements to the maritime distress
system.
In the 1970s a global search and rescue system was initiated. The 1970s also saw the
establishment of the International Mobile Satellite Organization (IMSO), which has
greatly improved the provision of radio and other messages to ships.
In 1992 a further advance was made when the Global Maritime Distress and Safety
System (GMDSS) began to be phased in. In February 1999, the GMDSS became fully
operational, so that now a ship that is in distress anywhere in the world can be virtually
guaranteed assistance, even if the ship's crew does not have time to radio for help, as the
message will be transmitted automatically.
Other Areas
Other measures introduced by IMO have concerned the safety of containers, bulk
cargoes, liquefied gas tankers and other ship types. Special attention has been paid to
ISM Code
Two initiatives in the 1990s are especially important. On 1 July 1998 the International
Safety Management Code entered into force and became applicable to passenger ships,
oil and chemical tankers, bulk carriers, gas carriers and cargo high-speed craft of 500
gross tonnage and above. It became applicable to other cargo ships and mobile offshore
drilling units of 500 gross tonnage and above not later than 1 July 2002.
STCW
On 1 February 1997, the 1995 amendments to the International Convention on Standards
of Training, Certification and Watch keeping for Seafarers, 1978 entered into force. They
greatly improve seafarer standards and, for the first time, give IMO itself powers to check
Government actions.
It is expected that these two measures, by raising standards of management and shipboard
personnel, will greatly improve safety and pollution prevention in the years to come.
Technical Co-operation
IMO has also developed a technical co-operation programme, which is designed to assist
Governments, which lack the technical knowledge, and resources that are needed to
operate a shipping industry successfully. The emphasis of this programme is very much
on training and perhaps the best example is the World Maritime University in Malm,
Sweden, which was established in 1983 and provides advanced training for the men and
women involved in maritime administration, education and management.
IMO is now concentrating on keeping legislation up to date and ensuring that as many
countries ratify it as possible. This has been so successful that many Conventions now
apply to more than 98% of world merchant shipping tonnage. Currently the emphasis is
on trying to ensure that the countries that have accepted them properly implement these
conventions and other treaties.
Assembly
This is the most important Governing Body of the Organization. It consists of all Member
States and it meets once every two years in regular sessions, but may also meet in an
extraordinary session if necessary. The Assembly is responsible for approving the work
programme, voting the budget and determining the financial arrangements of the
Organization. The Assembly also elects the Council.
Council
The Assembly elects the Council for two-year terms beginning after each regular session
of the Assembly.
The Council is the Executive Organ of IMO and is responsible, under the Assembly, for
supervising the work of the Organization. Between sessions of the Assembly the Council
performs all the functions of the Assembly, except the function of making
recommendations to Governments on maritime safety and pollution prevention, which is
reserved, for the Assembly.
Other functions of the Council are to:
1. Co-ordinate the activities of the organs of the Organization;
2. Consider the draft work programme and budget estimates of the Organization and
submit them to the Assembly;
3. Receive reports and proposals of the Committees and other organs and submit
them to the Assembly and Member States, with comments and recommendations
as appropriate;
4. Appoint the Secretary-General, subject to the approval of the Assembly;
5. Enter into agreements or arrangements concerning the relationship of the
Organization with other organizations, subject to approval by the Assembly.
The Council Members are elected observing the following criteria:
a) Ten shall be States with the largest interest in providing international shipping
services;
b) Ten shall be other States with the largest interest in international sea borne trade;
and
c) Twenty shall be States not elected under (a) or (b) above which have special
interests in maritime transport or navigation and whose election to the Council
will ensure the representation of all major geographic areas of the world.
maritime safety. It also has the responsibility for considering and submitting
recommendations and guidelines on safety for possible adoption by the Assembly.
Sub-Committees
The MSC and MEPC are assisted in their work by nine sub-committees, which are also
open to all Member States. They deal with the following subjects:
1)
2)
3)
4)
5)
6)
7)
8)
9)
Legal Committee
The Legal Committee is empowered to deal with any legal matters within the scope of
the Organization. The Committee consists of all Member States of IMO.
Facilitation Committee
It deals with IMO work in eliminating unnecessary formalities and red tape in
international shipping. Participation in the Facilitation Committee is open to all Member
States of IMO.
The 1991 amendments to the IMO Convention, which established the IMO), when they
come into force, will institutionalise the Facilitation Committee, putting it on the same
standing as the other Committees. However, these amendments have not yet received
enough acceptances to come into force.
shipbuilders and other interested parties so they make take account of the provisions of
the convention in their future acts and plans.
Signature
Consent may be expressed by signature where:
A State may also sign a treaty "subject to ratification, acceptance or approval". In such a
situation, signature does not signify the consent of a State to be bound by the treaty,
although it does oblige the State to refrain from acts which would defeat the object and
purpose of the treaty until such time as it has made its intention clear not to become a
party to the treaty.
Many States nowadays choose this option as it provides them with an opportunity to
ensure that any necessary legislation is enacted and other constitutional requirements
fulfilled before entering into treaty commitments.
Accession
Most multinational treaties are open for signature for a specified period of time.
Accession is the method used by a State to become a party to a treaty, which it did not
sign whilst the treaty was open for signature.
Technically, accession requires the State in question to deposit an instrument of accession
with the depositary.
accepted at the end of two years from the date on which it is communicated to
Contracting Governments...' unless the amendment is objected to by more than one third
of Contracting Governments, or Contracting Governments owning not less than 50 per
cent of the world's gross merchant tonnage. This period may be varied by the Maritime
Safety Committee with a minimum limit of one year.
As was expected the "tacit acceptance" procedure has greatly speeded up the amendment
process.
The tacit acceptance procedure means that amendments - which are nearly always
adopted unanimously - enter into force on a set date unless they are specifically rejected
by a specified number of countries.
Apart from the speed, tacit acceptance also means that everyone involved knows exactly
when an amendment will enter into force. Under the old system you never knew until the
final acceptance was actually deposited with IMO.
involved in an accident or have been damaged on the high seas if there is a grave risk of
oil pollution occurring as a result that would reach their waters.
The way in which these powers may be used are very carefully defined, and in most
conventions the flag State is primarily responsible for enforcing conventions as far as its
own ships and their personnel are concerned.
However, one of the recent important developments in the functioning of IMO has been
that IMO has been given (by the approval of its assembly, which in turn comprises of all
the member States) the authority to vet the training, examination and certification
procedures of Contracting Parties to the International Convention on Standards of
Training, Certification and Watch keeping for Seafarers (STCW), 1978. This was one of
the most important changes made in the 1995 amendments to the Convention, which
entered into force on 1 February 1997. Governments will have to provide relevant
information to IMO Maritime Safety Committee, which will judge whether or not the
country concerned meets the requirements of the Convention.
Country
Contribution ($)
Contribution (%)
Panama
4,141,951
18.47
Liberia
1,730,648
7.72
Bahamas
1,128,559
5.03
Country
Contribution ($)
Contribution (%)
United Kingdom
1,040,068
4.64
Greece
973,151
4.34
Singapore
900,531
4.02
Japan
842,596
3.76
Marshall Islands
802,983
3.58
United States
771,737
3.44
China
749,093
3.34
As a comparison from the previous year, the top ten contributors for 2004 were assessed
as follows (the figures show the amount payable and as a percentage of the total budget):
Country
Contribution ($)
Contribution (%)
Panama
3,827,870
17.0
Liberia
1,533,253
6.8
Bahamas
1,055,036
4.7
Greece
938,029
4.2
U. K.
843,330
3.7
Japan
805,998
3.6
Malta
787,405
3.5
U. S. A
704,551
3.1
Cyprus
695,084
3.1
Norway
681,133
3.0
IMO used to be called "the rich man's club". Has it changed at all?
When IMO began operations in 1959 shipping was still dominated by a relatively small
number of countries, nearly all of them located in the northern hemisphere the ones we
refer to today as the developed countries. IMO tended to reflect this. But as the balance of
power in the shipping industry began to change so did IMO.
The Maritime Safety Committee, the senior technical body, was thrown open to all
Member States (previously it had consisted only of 16 Members elected by the governing
Assembly). The Council, which acts as governing body in between the two-yearly
meetings of the Assembly, was increased in size from 18 to 24 Member States, and then
to 32 and, in 2002 was increased still further to 40. This was done partly to take into
account the growing membership of IMO, but also to ensure that the views of developing
countries were properly represented. The biggest increase in Council membership has
been to the section, which takes geographical representation into account.
So, it is no longer a rich mans club.
Future challenges
Marine safety, security and environment protection will remain a prominent and constant
focus of IMO in coming years. As the years progress, vessel technology and equipment
will continue to advance and become even more sophisticated, straining intellectual and
technical imaginations. Furthermore, the susceptibility of marine transportation to
terrorism has forever altered the way the world will transport people and cargo. Thus, the
future presents further challenges to marine transportation in terms of new technologies,
the human element, and the task of making world shipping secure from terrorist activities.
Although a new maritime security regime is now in force, the IMO cautions everyone
involved with maritime transport sector on the risk of complacency and advance the need
to maintain a high level of vigilance and awareness until they become second nature
throughout the shipping and port community.
Concurrently, the IMO will continue to improve the safety and security of international
shipping and the protection of the marine environment by seeking resolution to new and
outstanding issues, e.g., the existence of sub-standard vessels, while implementing and
enforcing adopted conventions and adjusting the current regulatory framework to
maintain the timeliness and relevance.
Concluding remarks
One can safely draw the conclusion that IMO has been successful in making its presence
felt in terms of maritime safety and marine pollution prevention. What is of important
nature is that IMO is all the more concerned about its own functions at the international
arena and is continuously evolving with the changing times.
2.
Shipping
More than three-quarters of world trade makes use of maritime or river transport. The
maritime sector is therefore international and dynamic. A further internationalisation of
the shipping industry in recent years has been manifested through changes in the
ownership and the management of ships, establishment of new registers, technological
developments, and crews consisting of seafarers from different cultures and with different
languages.
The world fleet of merchant ships comprises approximately 80,000 ships of 100 gross
tons or more (46, 222 are ocean going vessels)2. The largest fleets (by tonnage) are
registered in Panama, Liberia, Greece, Cyprus, Bahamas, Norway, Japan, Malta, China,
the Russian Federation, Singapore and the United States.
There are over 1.2 million seafarers serving aboard ships of over 100 gross tons or
waiting to do so. Approximately two-thirds are from the Asian region. There is a clear
1
2
The functions of IMO have been dealt with in the preceding pages, as well as in a separate lecture.
Lloyds Register, Fairplay, January 2005
trend in employment towards the hiring of seafarers from developing countries. Major
labour supplying countries include the Philippines, China and the Republic of Korea. An
increasing number of seafarers are also recruited from the Russian Federation and
Poland. A high percentage of the total number of seafarers is working on board ships not
registered in their own country.
ILO Activities
Because of the unique character of seafaring, most maritime countries have special laws
and regulations covering this occupation. Consequently, the ILO, since its founding, has
had special "machinery" for seafarers. The machinery includes the Joint Maritime
Commission, which advises the Governing Body on maritime issues, and special
Maritime Sessions of the International Labour Conference (ILC), which focus solely on
the preparation, and adoption of maritime labour standards.
The special nature of the conditions of work and life of seafarers led ILO to adopt an
extensive range of Conventions and Recommendations applying specifically to seafarers.
These instruments cover nearly all aspects of the working and living conditions at sea
such as, for example, the minimum age for admission to employment; hours of work and
rest periods; medical examination prior to employment aboard ship and periodically
thereafter; conditions for shipboard employment; articles of agreement; repatriation;
social security benefits; food, catering and accommodation; qualification requirement;
vocational training and welfare facilities; safety and health requirements. These standards
have influenced national legislation as well as the terms of collective agreements and
employment contracts laying down the working conditions of seafarers throughout the
world. This international seafarers' "code" directly or indirectly influences both the terms
of collective agreements and national maritime labour legislation.
An important maritime labour instrument is the Merchant Shipping (Minimum Standards)
Convention, 1976 (No. 147), which sets out the minimum internationally acceptable
standards for living and working conditions on board ships.
The main focus of ILO maritime programme concerns the promotion of the maritime
labour standards. The ILO work concerning seafarers has also resulted in the adoption of
codes of practice, guidelines and reports, which address seafarers' issues.
The ILO cooperates with other United Nations agencies with an interest in the maritime
field, such as the International Maritime Organization (IMO) in London and the World
Health Organization (WHO) in Geneva. There is close contact with the United Nations
Development Program (UNDP) and with regional UN offices.
Providing information and assistance to member States on ILO maritime standards and
the preparation of related national laws and regulations is given priority. Both the labour
and shipping (or transport) ministries of the countries concerned are involved in the
implementation of the ILO maritime labour standards. The following areas will continue
to keep the ILO busy with regard to shipping activities:
Past experience has shown that, while governmental officials dealing with the shipping
industry may be quite conversant with standards relating to safety and pollution
prevention from ships that are under the purview of the IMO, a similar level does not, in
many cases, exist as concerns the social/labour aspects. This is particularly the case for
the inspection of both national and foreign registered ships where the inspectors are better
trained on inspecting the technical aspects of the ship compared with ILO issues. In short,
the training of qualified inspectors to inspect and address labour standards, as well as
safety requirements, has to be promoted and enhanced.
The Programme will last for an initial period of 5 years and its scope and activities will
be kept under continuous review. Depending upon impact, the Programme could also be
extended if deemed necessary in the light of developments in the shipping industry.
The Programme will also closely liase with IMO to ensure the necessary coordination
with its ongoing technical assistance programme and avoid undue duplication.
Ports
Ports have undergone fundamental changes in the past decades due to changes in
shipping and cargo-handling technology, in particular the introduction of the standard size, inter-modal shipping containers. Cargo handling, once a labour-intensive activity,
has become increasingly capital - intensive as a result of these changes.
The result has been a substantial reduction in the number of persons required to move
cargo. Though sea borne trade has risen dramatically over the same period, the
considerable efficiencies resulting from the new technologies and techniques has meant a
dramatic decrease in the number of port workers needed in many ports. In many cases
this has resulted in redundancies and various schemes to preserve employment. It has also
led to round-the-clock port worker, with work divided into shift work, and other changes
designed to reduce the time ships spend in port and to increase the use of expensive
cargo-handling equipment.
Structural adjustment has caused the second - and more recent - wave of change in the
port sector. The general aim has been to improve the efficiency of port operations and to
bring their operations in line with private sector industries. This has usually resulted in
further cuts in the workforce.
ILO Activities
The ILO has also adopted a number of standards, which specifically concern the social
and labour conditions of port workers. Most of these are aimed at improving the safety of
dock work. Among the most important of these are the Dock Work Convention, 1973
(No. 137), the Occupational Safety and Health (Dock Work) Convention, 1979 (No.
152). The first instrument concerns protection for dockworkers against changes in their
employment resulting from technological changes and structural changes. The second
instrument concerns health and safety issues.
The ILO has provided technical advisory services and executed technical cooperation
projects covering areas such as recruitment and placement of port workers, occupational
safety and health, organization of work in ports, the assessment of training needs and
subsequent curricula development for training programmes, the training of instructors,
the establishment of port training centres and supervisory training.
only to the ship/port interface would not be effective without the existence of an
overarching comprehensive port security plan based on a comprehensive port security
assessment. One of the issues identified for consideration is that of port personnel
identification. As these issues impact on port worker regulations, the IMO has requested
the ILO to establish a Joint Working Group to:
a) Consider the form and content of further guidance on the wider issue of port
security including the relationship between ship and port facility security and
safety considerations relevant to port areas, including verifiable identification of
those working within these areas or having access to such areas; and
b) Consider the need for any mandatory provisions relating to the above
The ILO will be examining how to take these issues further in the future, in particular in
the framework of the planned revision of its Code of Practice on Safety and Health in
Dock Work to incorporate provisions on Security.
3.
About WHO
The World Health Organization is the United Nations specialized agency for health. It
was established on 7 April 1948. WHO's objective is the attainment by all peoples of the
highest possible level of health. Health is defined in WHO's Constitution as a state of
complete physical, mental and social well-being and not merely the absence of disease or
infirmity.
WHO is governed by 192 Member States through the World Health Assembly. The
Health Assembly is composed of representatives from WHO's Member States. The main
tasks of the World Health Assembly are to approve the WHO programme and the budget
for the following biennium and to decide major policy questions.
Gastrointestinal disease
A wide range of pathogens affected passengers and crew during ship-associated
gastrointestinal disease outbreaks. Most of the detected gastrointestinal disease outbreaks
have been associated with cruise ships and were linked to food or water consumed
onboard ship. Factors contributing to outbreaks included contaminated bunkered water,
Legionnaires' disease
Legionnaires' disease is a potentially fatal form of pneumonia, first recognized in 1976.
Inhaling legionella bacteria deep into the lungs normally contracts the disease. Legionella
species can be found in tiny droplets of water (aerosols) or in droplet nuclei (the particles
left after the water has evaporated).
The WHO review showed that over 50 incidents of Legionnaires' disease, involving over
200 cases, were associated with ships in the past three decades. For example, an outbreak
of Legionnaires' disease occurred on a single cruise ship in 1994. 50 passengers were
affected on nine different cruises and one passenger died. The disease was linked to a
whirlpool spa on the ship.
The problem is not restricted to passenger ships. Surveys carried out on merchant ships
have also shown drinking water and air conditioning systems to be contaminated with
Legionella pneumophila3.
Control measures, such as proper disinfection, filtration and storage of source water,
avoidance of dead ends in pipes and regular cleaning and disinfection of spas are
therefore required to reduce the risk of legionellosis on ships.
The IHR are currently being updated. It is proposed that the revised IHR cover both
urgent and routine public health services at ports, airports and ground crossings.
WHO Guide to Ship Sanitation
The WHO Guide to Ship Sanitation is the official global reference on health requirements
for ship construction and operation and is directly referenced in Article 14 of the IHR.
Its purpose is to standardize the sanitary measures taken in ships, to safeguard the health
of people on board and to prevent the spread of infection from one country to another.
The present edition of the Guide is based on the results of a survey of 103 countries and
represents a synthesis of best national practice.
Revision of the Guide to Ship Sanitation
The Guide was first published in 1967 and was reprinted with minor amendments in
1987. The construction, design and size of ships have changed dramatically since the
1960s and the greatly increased level of transport by ships poses new hazards (e.g.
Legionnaires' disease) that were not foreseen when the 1967 Guide was published.
Therefore, WHO is now updating the Guide in close collaboration with the International
Labour Organization (ILO) and the International Maritime Organization (IMO). The
recommendations on the revisions to the guide include:
Apply to all ships including passenger ships, general cargo vessels, fishing
vessels, naval vessels and tankers;
Cover preventive environmental health management including water supply at
port, water production, treatment and distribution on ship, swimming and spa
pools, waste disposal, food safety and vermin and vector control; and
Contain concluding chapters on disease surveillance, outbreak investigation, and
routine inspection and audit.
4.
ISF is the only broad based international employers' organisation dedicated to maritime
manpower issues, providing advice and guidance to members either directly or via its
extensive range of global contacts by representing them in all relevant foray where issues
are regulated.
In the plethora of international organisations, ISF represents the employers' voice on
industrial relations issues, proactively explaining and justifying employers' activities to
the media. To others, ISF is an authority on the STCW Convention and assists with
advice on its detailed technical requirements.
The ISF Secretariat also supports other international organisations, such as its sister
organisation the International Chamber of Shipping (ICS), and the International Maritime
Employers' Committee (IMEC). While each organisation is quite independent, these links
5.
The International Chamber of Shipping (ICS) is the international trade association for
merchant ship operators. ICS represents the collective views of the international industry
from different nations, sectors and trades.
ICS membership comprises national ship owners' associations4 representing over half of
the world's merchant fleet. A major focus of ICS activity is at the IMO.
ICS is heavily involved in a wide variety of areas including technical, legal and
operational matters affecting merchant ships. ICS is unique in that it represents the global
interests of all the different trades in the industry: bulk carrier operators, tanker operators,
passenger ship operators and container liner trades, including ship owners and third party
ship managers.
ICS has consultative status with a number of intergovernmental bodies, which have an
impact on shipping. Its close ties with IMO stretch back to this body's inception in 1958.
Other partners include the World Customs Organisation (WCO), the International
Telecommunications Union (ITU), the United Nations Conference on Trade and
Development (UNCTAD) and the World Meteorological Organization (WMO). ICS also
3
India is a member of ISF through the Indian National Ship Owners Association (INSA) with its
headquarters at Mumbai.
4
India is a member of ICS through the Indian National Ship Owners Association (INSA) with its
headquarters at Mumbai.
Purpose of ICS
The aim of ICS is to promote the interests of ship owners and operators in all matters of
shipping policy and ship operations. To that end ICS:
Encourages high standards of operation and the provision of high quality and
efficient shipping services
Strives for a regulatory environment, which supports safe shipping operations,
protection of the environment and adherence to internationally, adopted standards
and procedures
Promotes properly considered international regulation of shipping and oppose
unilateral and regional action by governments
Presses for recognition of the commercial realities of shipping and the need for
quality to be rewarded by a proper commercial return
Remains committed to the promotion of industry guidance on best operating
practices
Cooperates with other organisations, both intergovernmental and
non-governmental, in the pursuit of these objectives
Anticipates whenever possible and respond whenever appropriate to policies and
actions which conflict with the above
How ICS works?
The national associations that belong to ICS provide national representatives through a
network of committees, which are responsible for developing the international policy of
the industry, including positions to be adopted on international maritime regulatory
questions. The national representatives to ICS Committees include experts from
individual shipping companies, which are members of the national ship owners'
associations that belong to ICS. So far as possible, ICS represents the views of the entire
shipping industry at various forays, which develop international maritime conventions
and recommendations, especially the IMO. ICS is particularly influential because of the
support it receives from its member national ship owners associations', which represent
the views agreed within ICS to their national governments, which in turn comprise the
membership of bodies such as IMO.
6.
7.
SIGTTO was born out of a recognition that an industry specializing in the transport of
liquefied gas needed to establish and promote the adoption and implementation of the
very highest standards if it was first to win and then to maintain the confidence of the
public at large. In acting as a beacon for quality and best practices, SIGTTO and its
members have done just that, and that the excellent safety and pollution record of the sea
borne gas transport industry to date defines it quite categorically as a highly responsible
and effective sector.
By the late 1970s it was clear the international LNG business was set for a period of rapid
expansion. A number of involved companies were therefore concerned to agree essential
common standards for the industry, to aid its expansion, underpin public confidence and
avoid a proliferation of unilaterally defined regulations.
This group resolved to establish a body to draw together industry member companies in
an effort to establish commonly agreed standards and best practice criteria. Hence the
Society was formed and registered as a Bermuda Exempted Company (non-profit
making) with limited liability in October 1979.The Society was granted consultative
status at the IMO in 1982.
Formed originally with thirteen Members the Society has steadily grown over twenty
years to a membership of more than 100 companies; representing virtually the whole of
the worlds LNG trades and over half its LPG capacity.
SIGTTO has been an active participant in the work of IMO since it was granted observer
status back in 1982. It has become universally recognized as the authoritative voice of the
gas shipping and terminal industries and has made a significant contribution over the
years to the development and implementation of a wide variety of IMO measures.
Most recently, as one would expect, SIGTTO played a significant part in the
implementation of the new maritime security measures that entered into force worldwide
in July. The fact that the Society had been actively lobbying, supporting and working
with its members for many months prior to the introduction of the new measures should,
be recognized with appreciation.
Purpose
The Society is the international body established for the exchange of technical
information and experience, between members of the industry, to enhance the safety and
operational reliability of gas tankers and terminals. The organization has been organized
to encourage safe and responsible operation of liquefied gas tankers and marine terminals
handling liquefied gas; to develop advice and guidance for best industry practice among
its members and promote criteria for best practice to all who have responsibilities for, or
an interest in, the continuing safety of gas tankers and terminals.
To this end the Society publishes studies and produces information papers and works of
reference for the guidance of industry members. It maintains working relationships with
other industry bodies, governmental and intergovernmental agencies, including IMO, to
better promote the safety and integrity of gas transportation and storage schemes.
Benefits of being a member of SITTO
Membership benefits of SIGTTO are substantial. Much of SIGTTO work is publicly
available but the most important part is not. Members' benefit by: -
8.
OCIMF was incorporated in Bermuda in 1977 and a branch office was established in
London primarily to maintain contact with the IMO.
The current membership of OCIMF comprises 53 companies worldwide. From India, the
Indian Oil Corporation is a member of OCIMF.
Objectives
The primary objectives of OCIMF are the promotion of safety and prevention of
pollution from tankers and at oil terminals. OCIMF was granted consultative status in
1971 at the IMO. OCIMF is organised to co-ordinate oil industry views at IMO meetings,
to review technical proposals circulated by IMO and to advise its members on legislative
activities as they develop. OCIMF presents its members' views before individual national
governmental authorities and maintains a close liaison with other industry bodies and
associations. An important contribution to the overall safety of the industry is the role
that OCIMF plays in producing technical and operational guidelines, either by itself or in
co-operation with other industry associations.
OCIMF has produced in excess of 50 of these guidelines and many are now taken as the
industry standard in their particular field. OCIMF provides the means for joint research
projects to be undertaken and co-ordinated on behalf of its members. Many of these
projects, for example, studies on tanker drift and towage, mooring hawser strength etc,
have resulted in technical guidelines being published for the wider benefit of the industry.
Strategy
The strategy of OCIMF is to identify critical safety and environmental issues facing the
oil tanker and terminal industry, and develop and publish recommended criteria that will
serve as benchmarks for the industry.
OCIMF also, in conjunction with the IMO and other regulatory bodies, both regional and
national, support the development of international conventions and regulations that
enhance the safe construction and operation of oil tankers and terminals; support the
global implementation and enforcement of such international conventions and
regulations; and encourage industry-wide acceptance of established safety and
environmental guidelines and recommendations.
SIRE Introduction
One of the most significant safety initiatives to be introduced by OCIMF is the Ship
Inspection Report Programme (SIRE). This programme was originally launched in 1993
to specifically address concerns about sub-standard shipping. The SIRE Programme is a
unique tanker risk assessment tool of value to charterers, ship operators, terminal
operators and government bodies concerned with ship safety.
The SIRE system is a very large database of up-to-date information about tankers.
Essentially, SIRE has focused tanker industry awareness on the importance of meeting
satisfactory tanker quality and ship safety standards. Since its introduction, the SIRE
Programme has received industry-wide acceptance and participation by both OCIMF
Members, Programme recipients and by ship operators. The expansion of Barges and
small vessels into SIRE was inaugurated in late 2004.
The SIRE programme requires a uniform inspection protocol that is predicated by the
following:
- Vessel Inspection Questionnaire (VIQ)
- Barge Inspection Questionnaire (BIQ)
Uniform SIRE Inspection Report:
- Vessel Particulars Questionnaire (VPG)
- Barge Particulars Questionnaire (BPQ)
There is an electronic access to the SIRE system; both dial up and via the Internet.
These features have been established to make the program more uniform and user
friendly and to provide a level of transparency unique in the marine transportation
industry.
SIRE has established itself as a major source of technical and operational information to
prospective charterers and other programme users. Its increasing use corresponds with oil
industry efforts to better ascertain whether vessels are well managed and maintained.
Inspection reports are maintained on the index for a period of 12 months from the date of
receipt and are maintained on the database for 2 years. SIRE access is available, at a
nominal cost, to OCIMF members, bulk oil terminal operators, port authorities, canal
authorities, oil, power, industrial or oil trader companies which charter tankers/barges as
a normal part of their business. It is also available, free of charge, to Governmental
bodies, which supervise safety and/or pollution prevention in respect of oil tankers/barges
(e.g. port state control authorities, MOU, etc).
Conclusion
The seafarers lead a very secluded life on board busy with what they have to do! But in
todays shipping world, it will increasingly become difficult to function in a proverbial
watertight compartment. The seafarer will constantly need to broaden his horizons and
have a feel of the maritime world that exists beyond the shipside. It was with this aspect
in mind that an introduction to the various international organisations has been given. He
no doubt uses on board the various procedures and documents produced by the
aforementioned organisations, but if he has an idea about these organisations, he will be
able to apply the rules and follow industry standards in a more sensitive manner
Introduction
International law is the only universally recognized framework that applies to all people
everywhere. As an impartial and objective set of standards, international law is capable of
handling issues involving everyone at the international level as well as, resolving disputes
without prejudice in favour of one party.
This introductory note seeks to provide a basic - but not an exhaustive - overview of the
key terms employed in the international instruments binding at international law treaties, agreements, conventions, protocols, memoranda of understanding, resolutions,
adoption, ratification, amendments etc. The purpose is to facilitate a general
understanding of their scope and function.
Although these instruments differ from each other by title, they all have common features
and international law has applied basically the same rules to all of these instruments.
These rules are the result of long practice among the States, which have accepted them as
binding norms in their mutual relations. Therefore, they are regarded as international
customary law.
(a)
The term "treaty" has regularly been used as a generic term embracing all instruments
binding at international law concluded between international entities, regardless of their
formal designation.
In order to speak of a "treaty" in the generic sense, an instrument has to meet various
criteria.
First of all, it has to be a binding instrument, which means that the contracting
parties intended to create legal rights and duties.
Secondly, the instrument must be concluded by states or international
organizations with treaty-making power.
Thirdly, it has to be governed by international law.
Finally the engagement has to be in writing.
(b)
There are no consistent rules when state practice employs the terms "treaty" as a title for
an international instrument. Usually the term "treaty" is reserved for matters of some
gravity that require more solemn agreements. Their signatures are usually sealed and they
normally require ratification. Typical examples of international instruments designated as
"treaties" are Peace Treaties, Border Treaties, Delimitation Treaties, Extradition Treaties
and Treaties of Friendship, Commerce and Co-operation. It is however important to note
that the use of the term "treaty" for international instruments has considerably declined in
the last decades in favour of other terms.
What is a Convention?
The term "convention" again can have both a generic and a specific meaning.
(a) Convention as a generic term
The generic use of the term "convention" embraces all international agreements, in the
same way as does the generic term "treaty". The generic term "convention" thus is
synonymous with the generic term "treaty".
(b) Convention as a specific term
Whereas in the last century the term "convention" was regularly employed for bilateral
agreements, it now is generally used for formal multilateral treaties with a broad number
of parties. Conventions are normally open for participation by the international
community as a whole, or by a large number of states. Usually the instruments
negotiated under the auspices of an international organization are entitled
conventions (e.g. United Nations Convention on the Law of the Sea of 1982). The same
holds true for instruments adopted by an organ of an international organization, such as
the IMO, (e.g. the SOLAS Convention, MARPOL 73/78 Convention, STCW
Convention)
What is a Protocol?
The term "protocol" is used for agreements less formal, but nevertheless of the same
importance, than those entitled "treaty" or "convention". The term could be used to cover
the following kinds of instruments:
(a) A Protocol of Signature is an instrument subsidiary to a treaty, and drawn up by the
same parties. Such a Protocol deals with ancillary matters such as the interpretation of
particular clauses of the treaty, those formal clauses not inserted in the treaty, or the
regulation of technical matters. Ratification of the treaty will normally ipso facto involve
ratification of such a Protocol.
(b) An Optional Protocol to a Treaty is an instrument that establishes additional rights
and obligations to a treaty. It is usually adopted on the same day, but is of independent
character and subject to independent ratification. Such protocols enable certain parties of
the treaty to establish among themselves a framework of obligations, which reach further
than the general treaty and to which not all parties of the general treaty consent, creating
a "two-tier system". This function of the Protocol has been used very rarely.
(c) A Protocol based on a Framework Treaty is an instrument with specific substantive
obligations that implements the general objectives of a previous framework or umbrella
convention. Such protocols ensure a more simplified and accelerated treaty-making
process and have been used particularly in the field of international environmental law.
An example is the 1987 Montreal Protocol on Substances that Deplete the Ozone Layer.
(d) A Protocol to amend is an instrument that contains provisions that amend one or
various former treaties, such as the Protocol of 1978 amending the 1973 Treaty on
MARPOL. It is this function of the Protocol in international law that we seafarers
should be comfortable in using as, this is what is, and will be, used pertaining to us
at IMO. For a change to be termed as a Protocol, and not an amendment, two
parameters have to be fulfilled:
1. The issue has to be of vital importance
2. The change should be such that the existing face of the treaty / convention is
altered.
For example, the change of 1997 (Introduction of Annex VI) to MARPOL 73/78 is
called a Protocol and not an amendment. Why? Because, the issue of air pollution
was of vital importance and the introduction of a new annex changed the face of the
existing convention (earlier when we mentioned MARPOL, we meant five annexes,
now we mean six annexes). Hence the change of 1997 to MARPOL is NOT called an
amendment, but Protocol of 1997.
What is a Resolution?
It is a determination of policy by the vote. Legislative bodies such as the IMO pass
resolutions, but they are often statements of policy, belief or appreciation, and not always
enactment of statutes or ordinances. Once a resolution is enacted by a diplomatic
conference at IMO, it becomes a convention and is legally binding.
What is Accession?
"Accession" is the act whereby a state accepts the offer or the opportunity to become a
party to a treaty already negotiated and signed by other states. It has the same legal effect
as ratification. Accession usually occurs after the treaty has entered into force. The
conditions under which accession may occur and the procedure involved depend on the
provisions of the treaty.
What is an Amendment?
The term "amendment" refers to the formal alteration of treaty provisions affecting all the
parties to the particular agreement. Such alterations must be effected with the same
formalities that attended the original formation of the treaty. Many multilateral treaties
lay down specific requirements to be satisfied for amendments to be adopted. In the
absence of such provisions, amendments require the consent of all the parties.
What is Ratification?
Ratification defines the international act whereby a state indicates its consent to be bound
to a treaty if the parties intended to show their consent by such an act. In the case of
bilateral treaties, ratification is usually accomplished by exchanging the requisite
instruments, while in the case of multilateral treaties the usual procedure is for the
depositary (for example the Secretary-General of IMO) to collect the ratifications of all
states, keeping all parties informed of the situation. The institution of ratification grants
states the necessary time frame to seek the required approval for the treaty on the
domestic level and to enact the necessary legislation to give domestic effect to that treaty.
States Parties must accept Annexes I and II, but the other Annexes are voluntary.
1978 Conference on Tanker Safety and Pollution Prevention and the changes
brought about
The Conference, in February 1978, adopted a protocol to the 1973 MARPOL
Convention, absorbing the parent Convention and expanding on the requirements for
tankers to help make them less likely to pollute the marine environment.
The Protocol expanded the requirements for segregated ballast tanks to all new crude oil
tankers of 20,000 DWT and above and all new product carriers of 30,000 DWT and
above. The Protocol also required segregated ballast tanks to be protectively located, in
other words, placed in areas of the ship where they will minimise the possibility of and
amount of oil outflow from cargo tanks after a collision or grounding.
New tankers over 20,000 DWT were required to be fitted with crude oil washing system.
Crude oil washing, or COW, is the cleaning or washing of cargo tanks with high-pressure
jets of crude oil. This reduces the quantity of oil remaining on board after discharge.
The Protocol also called for existing tankers over 40,000 DWT to be fitted with either
segregated ballast tanks or crude oil washing systems; while for an interim period, it also
allowed for some tankers to use clean ballast tanks, whereby specific cargo tanks are
dedicated to carry ballast water only.
Additional measures for tanker safety were incorporated into the 1978 Protocol to the
International Convention for the Safety of Life at Sea (SOLAS), 1974. These included
the requirement for inert gas systems (whereby exhaust gases, which are low in oxygen
and thus incombustible, are used to replace flammable gases in tanks) on all new tankers
over 20,000 DWT and specified existing tankers. The SOLAS Protocol also included
requirements for steering gear of tankers; stricter requirements for carrying of radar and
collision avoidance aids; and stricter regimes for surveys and certification.
In order to speed up implementation of MARPOL, the Conference allowed that the
Parties "shall not be bound by the provisions of Annex II of the Convention for a period
of three years" from the date of entry into force of the Protocol, so that countries could
accept Annex I and have three years to implement Annex II.
Both the 1978 MARPOL and SOLAS Protocols were seen as major steps in raising
construction and equipment standards for tankers through more stringent regulations.
Enforcement of MARPOL 73/78
Any violation of the MARPOL 73/78 Convention within the jurisdiction of any Party to
the Convention is punishable either under the law of that Party or under the law of the
flag State. With the exception of very small vessels, ships engaged on international
voyages must carry on board valid international certificates, which may be accepted at
foreign ports as prima facie evidence that the ship complies with the requirements of the
Convention.
If, however, there are clear grounds for believing that the condition of the ship or its
equipment does not correspond substantially with the particulars of the certificate, or if
the ship does not carry a valid certificate, the authority carrying out the inspection may
detain the ship until it is satisfied that the ship can proceed to sea without presenting
unreasonable threat of harm to the marine environment.
Amendment Procedure
Amendments to the technical Annexes of MARPOL 73/78 can be adopted using the "tacit
acceptance" procedure, whereby the amendments enter into force on a specified date
unless an agreed number of States Parties object by an agreed date.
In practice, amendments are usually adopted either by IMO Marine Environment Protection
Committee (MEPC) or by a Conference of Parties to MARPOL.
The Protocol of 1997 (Annex VI - Regulations for the Prevention of Air Pollution
from Ships)
Adoption: 26 September 1997
Entry into force: 19 May 2005
The Protocol was adopted at a Conference and adds a new Annex VI on Regulations for
the Prevention of Air Pollution from Ships to the Convention.
are more or less likely to take the same route over and over again. And since this has
happened over the years, and will continue to happen in future, what happens is that
polluting particles from the numerous ships on that route suspend in the atmosphere as a
band and thus harm the ozone layer. It has therefore become necessary that the
atmospheric band of exhaust gases that will remain suspended on routes of various
shipping lanes around the world does not harm the ozone layer.
The ships contributory factors related to the depletion of ozone layer are sulphur oxides,
which are a function of the sulphur content in the fuel oil and the nitrogen oxides, which
are a function of the exhaust of diesel engines.
This is a Protocol to the Vienna Convention on the Protection of Ozone Layer; 1985. Under the
international law terminology (as explained earlier) this comes the Protocol Based on a Framework
Treaty function of the Protocol.
Format of Annex VI
Annex VI consists of three Chapters and a number of Appendices:
Chapter 1 - General
The second method works by having a NOx analyser fitted onboard the vessel, which
takes readings once every 30 days, with data stored on a CD or mini-disk and handed to
the Administration. The annual survey is then reduced to an inspection of the monitoring
system and data alone, probably only half an hours exercise, in order for them to issue an
IAPP. However, here the challenge is to ensure that the system is secure and
tamper-proof.
Example
There is a company called MARTEK that has spent three years perfecting its new
MariNOx Engine Emissions Monitoring System, which it claims offers the simplest
solution for compliance with Annex VI and The NOx Technical Code. Constant
monitoring of emissions also allows optimisation of engine performance, allowing fuel
savings of up to 4%, says MARTEK, therefore providing rapid payback of the systems
cost of around $100,000. Testing has already taken place aboard a tanker of over 100,000
DWT at different engine loads, and both the owner and MARTEK are reported to be
delighted with results. Once this system, and others developed in the future, becomes
marketable, the cost will definitely come down. And, research and further development in
this area will catch on in the immediate future, as it is now a requirement by law
(MARPOL) to have NOX compliant engines.
Adoption of
Amendment
Entry in force of
the amendment
Section / Chapter
effected
2000
13 March 00
1 January 02
Annex III
2001
27 April 01
1 September 02
Annex I
Tainting refers to the ability of a product to be taken up by an organism and thereby affect the taste or smell of seafood making it unpalatable. A substance is defined as tainting when it has been found
to taint seafood.
Although the CAS does not specify structural standards in excess of the provisions of other IMO conventions, codes and recommendations, its requirements stipulate more stringent and transparent
verification of the reported structural condition of the ship and that documentary and survey procedures have been properly carried out and completed. The Scheme requires that compliance with the
CAS be assessed during the Enhanced Survey Programme of Inspections concurrent with intermediate or renewal surveys currently required.
Year of
Amendment
2003
Adoption of
Amendment
27 April 01
Entry in force of
the amendment
April 05
Section / Chapter
effected
Annex I
The full timetable for the phasing out of single-hull tankers is as follows:
Date or year
5 April 2005 for ships delivered on 5 April 1982 or earlier
2005 for ships delivered after 5 April 1982
5 April 2005 for ships delivered on 5 April 1977 or earlier
2005 for ships delivered after 5 April 1977
2006 for ships delivered in 1978 and 1979
2007 for ships delivered in 1980 and 1981
2008 for ships delivered in 1982
2009 for ships delivered in 1983
2010 for ships delivered in 1984 or later
but
before
January
1978
Year of
Amendment
2004
Adoption of
Amendment
1 April 04
Entry in force of
the amendment
1 August 05
Section / Chapter
effected
Annex IV
2004
1 April 04
1 August 05
Appendix
Annex V
2004
15 Oct 04
1 January 07
Annex I
The revised MARPOL Annex I Regulations for the prevention of pollution by oil incorporates the various amendments adopted since MARPOL entered into force in 1983, including the amended
regulation 13G (regulation 20 in the revised annex) and regulation 13H (regulation 21 in the revised annex) on the phasing-in of double hull requirements for oil tankers. It also separates, in different
chapters, the construction and equipment provisions from the operational requirements and makes clear the distinctions between the requirements for new ships and those for existing ships. The revision
provides a more user-friendly, simplified Annex I.
Year of
Amendment
2004
Adoption of
Amendment
15 Oct 04
Entry in force of
the amendment
1 January 07
Section / Chapter
effected
Annex II
Year of
Amendment
2004
Adoption of
Amendment
15 Oct 04
Entry in force of
the amendment
1 January 07
Section / Chapter
effected
Annex II
2005
22 July 05
19 May 06
22 Nov 06
Annex VI
Establishment of the Baltic Sea SOx Emission Control Area (SECA). The NOx
Technical Code has also been updated.
Establishment of North Sea as SECA
Amendment procedure
There are two ways to make amendments to SOLAS.
The first one is done at the Maritime Safety Committee (MSC) itself. Amendments
proposed by a Contracting Government are circulated at least six months before
consideration by the MSC - which may refer discussions to one or more IMO
Sub-Committees - and amendments are adopted by a two-thirds majority of Contracting
Governments present and voting in the MSC (remember, MSC consists of all member
states).
Amendments by a Conference
The second method for amendments is by calling a diplomatic conference of Contracting
Governments. When Contracting Government requests the holding of a Conference and
10
As mentioned in my lecture on IMO, the SOLAS Convention of 1914, 1929 and 1948 were adopted by CMI (The International
Maritime Committee) that is before IMO came into existence. When IMO met for the first time in 1959, the SOLAS Convention
was adopted in 1960.
Year of
Amendment
Adoption of
Amendment
Entry in force of
the amendment
Section / Chapter
effected
2000
26 May 00
1 January 02
Chapter II,
Reg. 28.1
2000
6 Dec. 00
1 July 02
Chapter II - 1
Chapter II - 2
Chapter V
Chapter revised.
Year of
Amendment
Adoption of
Amendment
Entry in force of
the amendment
Section / Chapter
effected
2000
6 Dec. 00
1 July 02
Chapter X
2001
24 May 02
1 January 04
Chapter VII
The High-Speed Craft Code 2000 is made mandatory for new ships.
The 2000 HSC Code updates the mandatory High-Speed Craft Code
adopted in 1994. The 2000 HSC applies to all HSC built after the
date of entry into force, 1 July 2002.
IMDG Code made mandatory. Provisions for Chapters 1.3, 2.1, 2.3,
2.33, 3.2, 3.5, 5.4, 5.4.5 and 7.3 remain recommendatory11.
2001
June 01
1 January 03
Chapter VII
This chapter dealing with dangerous goods as well as, the INF Code
were aligned with the IMDG Code
2002
13 Dec.02
1 July 04
Chapter II-1
Chapter III
11
In practice, this means that from the legal point of view, the whole of the IMDG Code is made mandatory, but provisions of recommendatory nature are editorially expressed in the Code (e.g. using
the word "should" instead of "shall") to clarify their status.
Year of
Amendment
Adoption of
Amendment
Entry in force of
the amendment
Section / Chapter
effected
2002
13 Dec.02
1 July 04
Chapter XI 1
Chapter XI 2
Chapter XII
12
The CSR shall be issued by the Administration and shall contain information such as the name of the ship and of the State whose flag the ship is entitled to fly, the date on which the ship was
registered with that State, the ship's identification number, the port at which the ship is registered and the name of the registered owner(s) and their registered address. Any changes shall be recorded in
the CSR so as to provide updated and current information together with the history of the changes.
13
When activated the ship security alert system shall initiate and transmit a ship-to-shore security alert to a competent authority designated by the Administration, identifying the ship, its location and
indicating that the security of the ship is under threat or it has been compromised. The system will not raise any alarm on-board the ship. The ship security alert system shall be capable of being activated
from the navigation bridge and in at least one other location.
Year of
Amendment
Adoption of
Amendment
Entry in force of
the amendment
Section / Chapter
effected
2003
June 03
1 July 06
Chapter V;
Reg. 28
2004
May 04
1 July 06
Chapter III
Year of
Amendment
Adoption of
Amendment
Entry in force of
the amendment
Section / Chapter
effected
2004
May 04
1 July 06
Chapter V
2004
Dec. 04
1 July 06
Chapter XII
14
The S-VDR is not required to store the same level of detailed data as a standard VDR, but nonetheless should maintain a store, in a secure and retrievable form, of information concerning the position,
movement, physical status, command and control of a vessel over the period leading up to and following an incident.
Year of
Amendment
Adoption of
Amendment
Entry in force of
the amendment
Section / Chapter
effected
2005
May 05
1 Jan07 /
1 Jan 09
Chapter II
Part A of the Code is mandatory. The minimum standards of competence required for
seagoing personnel are given in detail in a series of tables. Chapter II of the Code, for
example, deals with standards regarding the master and deck department.
Part B of the Code contains recommended guidance, which is intended to help Parties
implement the Convention. The measures suggested are not mandatory and the examples
given are only intended to illustrate how certain Convention requirements may be
complied with. However, the recommendations in general represent an approach that has
been harmonized by discussions within IMO and consultation with other international
organizations.
Amendment Procedure
Amendments to the 1978 STCW Convention's technical Annex may be adopted by a
Conference of STCW Parties or by IMO Maritime Safety Committee, expanded to
include all Contracting Parties, some of whom may not be members of the Organization.
Amendments to the STCW Annex will normally enter into force one and a half years
after being communicated to all Parties unless, in the meantime, they are rejected by
one-third of the Parties or by Parties whose combined fleets represent 50 per cent of
world tonnage.
technical regulations have been transferred. Part A of the Code is mandatory while Part B
is recommended.
Dividing the regulations up in this way makes administration easier and it also makes the
task of revising and updating them more simple: for procedural and legal reasons there is
no need to call a full conference to make changes to Codes.
Some of the most important amendments adopted by the Conference concern Chapter I General Provisions. They include the following:
Alternative certification
Regulations regarding alternative certification (also known as the functional approach)
are included in a new Chapter VII. This involves enabling crews to gain training and certification
in various departments of seafaring rather than being confined to one branch (such as deck or
engine room) for their entire career. Although it is a relatively new concept, the 1995 Conference
was anxious not to prevent its development. At the same time, the new Chapter is intended to
ensure that safety and the environment are not threatened in any way. The use of equivalent
educational and training arrangements is permitted under article IX.
Watch-keeping
Measures were introduced for watch-keeping personnel to prevent fatigue.
Administrations are required to establish and enforce rest periods for watch-keeping
personnel and to ensure that watch systems are so arranged that the efficiency of watchkeeping personnel is not impaired by fatigue.
Annex III contains certificates, including the International Load Line Certificate.
The 1971 amendments - to make certain improvements to the text and to the chart
of zones and seasonal area
The 1975 amendments - to introduce the principle of 'tacit acceptance' into the
Convention
The 1979 amendments - to make some alterations to zone boundaries off the coast
of Australia
The 1983 amendments - to extend the summer and tropical zones southward off
the coast of Chile.
The 1988 Protocol
Adoption: 11 November 1988
Entry into force: 3 February 2000
The Protocol was primarily adopted in order to harmonize the Convention's survey and
certification requirement with those contained in SOLAS and MARPOL 73/78.
The harmonized system alleviates the problems caused by survey dates and intervals
between surveys, which do not coincide, so that a ship should no longer have to go into
port or repair yard for a survey required by one Convention shortly after doing the same
thing in connection with another instrument.
The 1988 Load Lines Protocol revised certain regulations in the technical Annexes to the
Load Lines Convention and introduced the tacit amendment procedure (which was
already applicable to the 1974 SOLAS Convention) Amendments to the Convention may
be considered either by the Maritime Safety Committee or by a Conference of Parties.
Amendments must be adopted by a two-thirds majority of Parties to the Convention
present and voting. Amendments enter into force six months after the deemed date of
acceptance - which must be at least a year after the date of communication of adoption of
amendments unless they are rejected by one-third of Parties. Usually, the date from
adoption to deemed acceptance is two years.
Conclusion
What has been presented above is an endeavour to help the student to comprehend the
various amendments and to bring home the point that any convention has to flexible
enough to incorporate the changing world of shipping. As more developments take place,
the conventions will be amended to incorporate the changes in order to keep pace.
Furthermore, the student should also realise that the conventions are normally made
keeping the future in mind and therefore they cannot be rigid.
can also be a port terminal inspection which is highly a localised inspection pertaining to
the existing laws being followed in a particular port. The following table will help
understand the concept of various control procedures.
Type of Entity
Flag State
Purpose
To ensure compliance with
international law
Classification
Society
Port State
Control
Insurance
Vetting
Inspections
Condition
surveys
Inspection by
Port Terminal
Authority
To ensure CONTINUED
compliance with
international law (as
incorporated in their
domestic law) as well as a
vested interest in
protecting their territorial
waters
For tanker chartering
Types of survey
Initial, annual, intermediate, renewal for issuance
and maintenance of statutory certificates
Initial, annual, intermediate, renewal for the
MAINTENANCE of Class
At random in a port. However, the randomness is
normally controlled if the port state is a part of a
regional MOU
1.
The flag state is responsible, under international law, to ensure that a ship is maintained
in a safe, sound and seaworthiness condition. To ensure that the ship does so, the flag
state inspects, or arranges for inspection, the ship and issues what are called the statutory
certificates. These certificates are governed by conventions under international law such
as, SOLAS, MARPOL, Load-line, and STCW etc.
Statutory Certificates
Surveyors thoroughly review a vessel's documentation (certificates) to ensure that they
comply with international standards with regard to safety, pollution prevention and safe
manning during the intervals mandated by the various conventions. Surveys must be
completed within the required survey window as stipulated under the international law.
The surveys are conducted for the issuance, and subsequent maintenance, of the
following certificates:
- Lifesaving Appliance.
- Fire fighting Equipment
- Navigation Equipment
Load Line Certificate
Documentation, and Safe Manning certificate
Accommodations, provisions, and working spaces
It is the responsibility of the flag state to ensure adherence, by a ship, to international law
with regard to housekeeping under the ILO Convention 147. The above certification
ensures the compliance with five major conventions namely, SOLAS, MARPOL, STCW,
Load-line and ILO 147.
All the above certificates have a validity of five years. During this period, the ship is
surveyed annually, periodically (intermediate survey) and finally at the end of five years
for renewal. The extent of survey and the time spent in conducting a survey varies at each
survey. This is a function of the age, type and size of the vessel and the survey can extend
from a few hours to a few weeks!
2.
Classification Surveys
When the vessel is being built, it has now become imperative by tradition and practice of
the shipping world over the years that the ship is classed by a classification society. The
classification society starts its work from the approval of plans prior to the
commencement of construction. During the entire period the ship is under construction, a
classification surveyor will survey the workmanship of construction. The objective here
is of course from the future insurance point of view, but a ship owner today cannot afford
to function without the certification from a classification society. So, in a nutshell, the
scope of classification is:
A technical review of the design plans and related documents for a new vessel to
verify compliance with the applicable rules
Attendance at the construction of the vessel in the shipyard by a classification
society surveyor(s), and at the relevant production facilities that provide key
components such as the steel, engine, generators and castings, to verify that the
vessel is constructed in accordance with the classification rules
Upon satisfactory completion of the above, the ship owners request for the
issuance of a class certificate will be considered by the relevant classification
committee, or another body, of the class society and, if deemed satisfactory, the
assignment of class will be approved and a certificate of classification issued
Once in service, the owner must submit the vessel to a clearly specified program
of periodical class surveys, carried out onboard the vessel, to verify that the ship
continues to meet the relevant rule conditions for continuation of class.
A classification survey is therefore a visual examination that normally consists of:
-
Recommendation and condition of class are synonymous terms used by
IACS societies for requirements that specific measures, repairs, request for surveys etc.,
are to be carried out by the owner within a specified time period in order to retain class.
At the time of annual surveys, the ship is generally examined. The survey
includes an external, general inspection of the hull, equipment and machinery of the ship
and some witnessing of tests, so far as is necessary and practical in order to determine
whether the ship remains in a general condition which satisfies the Rule requirements.
Older ships of certain types may also be subject to a general examination of some
specified internal areas of the hull. Depending upon the age, size, type and condition of
the vessel, an annual survey may take from several hours to a few days to complete.
What is the difference between classification and certification?
Certification is a one-time verification that something meets a standard. Certification is a
process that ensures that a system complies with national, international, industry or other
standards at the time of certification. The process of Certification generally concerns
systems that will become part of the ship.
Classification is part of a life-long process to assure a ship is built and maintained to
industry-accepted standards. There are four steps to it:
1. Development of Rules of Classification: Rules are developed in accordance with field
and engineering experience and are reviewed and approved by an extensive committee
system of foremost industry experts. Thus the Rules are acceptable to a broad spectrum
of owners, charterers, operators, and the class societys in-house experts. Not all
classification societies have such a "public" Rule-making process.
2. Design Review: Designers of marine vessels submit their designs to classification
society (of their choice) engineers to verify that requirements have been met. Lists of
requirements for submittals are found in each societys set of Rules or Guides.
3. Survey during construction. Approved design drawings are sent to classification
surveyors at vendor shops and fabrication yards. There the surveyors confirm that the
equipment as built conforms to the requirements and the approved drawings.
4. Surveys after construction. Once commissioned, periodic surveys as well as damage
and repair surveys, are performed throughout the life of the ship to ensure that the ship
remains in compliance with the classification rules, thereby enhancing the safety of the
ship and the protection of the environment. Classification surveyors visit each vessel at
least every 15 months over a five-year cycle. An "Intermediate" survey is conducted after
two and a half years. Once each five years a comprehensive survey is performed, a
"Special" survey, including dry-docking.
Harmonization of surveys
A brief word on harmonisation. On going through the write up so far, you may have a
feeling that why the same issue has to be surveyed more than once? Well, the answer is
that each survey has a different purpose and therefore done by a different entity. This
however does not mean that there has to be too much of repetition in the concept of
surveying a ship. And that is where the IMO has brought about the scheme of
harmonisation of surveys whereby, the various entities co-operate with each other and try
to survey at the same time. This not only reduces the workload of the ships staff but also
reduces the time spent.
3.
Port State Control (PSC) is the inspection of foreign ships in national ports to verify that
the condition of the ship and its equipment comply with the requirements of international
regulations and that the ship is manned and operated in compliance with these rules.
Many of IMO most important technical conventions contain provisions for ships to be
inspected when they visit foreign ports to ensure that they meet IMO requirements.
These inspections were originally intended to be a back up to flag State implementation,
but experience has shown that they can be extremely effective, especially if organized on
a regional basis. A ship going to a port in one country will normally visit other countries
in the region before embarking on its return voyage and it is to everybody's advantage if
inspections can be closely co-ordinated.
This ensures that as many ships as possible are inspected but at the same time prevents
ships being delayed by unnecessary inspections. The primary responsibility for ships'
standards rests with the flag State - but port State control provides a "safety net" to catch
substandard ships.
A point to also be noted is the fact that the vested interest of the government of a PSC
inspection is to ensure that its territory is not harmed by a visiting vessel in terms of safe
operations and preventing pollution to its environment.
Port State Control (PSC) is a ship inspection program whereby foreign vessels entering a
sovereign states waters are boarded and inspected to ensure compliance with various
major international maritime conventions, namely:
1. International Convention for the Safety of Life at Sea (SOLAS),
2. International Convention for the Prevention of Pollution from Ships (MARPOL),
International Convention on Standards of Training Certification and Watch
keeping for Seafarer (STCW),
3. Load Lines (LL),
4. Convention on the International Regulations for Preventing Collisions at Sea
(COLREG)
5. International Labour Organization Convention No. 147 Merchant Shipping
(Minimum Standards) (ILO 147).
The level of survey conducted by a PSC inspector can go from a preliminary inspection
to a more detailed inspection of the entire vessel. This will be dependent upon the
impression that he gets while on board. What he will check is to ensure that there is a
well-planned system of operation on board. If satisfied at the initial stage, then he will
limit his inspection otherwise; he will start his detailed inspection.
4.
Vetting Inspections
Ship vetting is an in-depth assessment of a ship with respect to its quality and that of its
owner, operator and manager, right from commissioning to current status. Vetting
enables the charterer to optimise vessel selection by matching available vessels to
operational requirements of the voyage and therefore maximising efficiency.
Brief History
Tanker ownership was traditionally with oil companies. Long-term time charters were
becoming increasingly rare with the spot charter market becoming very active.
In and around the 70s and 80s, the oil industry saw ownership of tankers gradually
moving from oil companies to independent ship owners. The pattern of tanker ownership
moved from the well-established independent ship owner with a substantial fleet to nontraditional shipping interests, often with no active interest or experience in shipping. The
fleet size was also small, sometimes only a single ship representing the owners stake in
the oil industry.
Ship managers began to play a growing and influential role in this changing world. The
oil industry, now being a major spot charterer of all types of tonnage, began to be
concerned with the quality of tankers. A number of member companies of an
internationally well-established organisation called the Oil Companies International
Marine Forum (OCIMF) began the development of ship vetting systems in the late '70s
and early '80s. Each scheme was unique to the individual company's needs. Recognising
that different standards were sometimes being applied, with consequent confusion
amongst ship owners, OCIMF members developed Inspection Guidelines for Oil Tankers
in 1989, based on international conventions such as SOLAS, MARPOL, STCW etc. and
industry-accepted technical guidance such as ISGOTT (International Safety Guide for Oil
Tankers and Terminals) and other standards.
Individual in-house databases enabled the oil company to form a reliable view of a ship's
suitability for charter. The number of major tanker accidents in 1989, ship quality and
liability issues assumed an even greater prominence in the oil industry. Besides vessels,
there was a realisation in the industry that shore-based management of the ship was
important as well. Therefore, OCIMF members began to assess the quality of ship
management agencies, operators, their policies and the implementation of those policies.
The Objectives of Vetting
The overall aim is to increase safety at sea and to decrease pollution. The following
issues are part of the broader perspective of ship vetting:
To check whether the ship complies in every respect with international legislation
and with certain industrial standards
To avoid major oil pollution cases because it damages the reputation of oil
companies and it involves enormous financial responsibilities.
At the same time, the environment is better protected. To increase safety on board
as well as to better the safety management of a company
To decrease the danger of explosion and/or fire and the ensuing damages for the
terminal installation and its surroundings
To ensure that cargo is not carried on substandard ships
There are too many implications if the cargo is damaged or lost due to
substandard vessels, owners, operators or managers.
There are at present mainly two initiatives working in this field:
(1). Ship Inspection Report Programme (SIRE) is a project worked out by OCIMF and
concerns the transport of oil by sea.
time seeking to carry out inspections. Clearly, apart from the sheer inefficiency of this
activity, ship staff was put under considerable stress at times when the ship was busy in
port, probably loading or discharging. OCIMF members also recognised that it would be
impossible for individual companies to maintain up-to-date inspection reports on every
ship that was potentially of interest to them and that some system of sharing inspection
reports was necessary. This combination of circumstances led to the development of the
SIRE programme that was launched in November 1993. The original SIRE programme
consisted of a database comprising OCIMF member company's inspection reports
compiled according to each company's individual inspection procedures. The SIRE report
itself contained only that information that had been submitted by the inspecting company
and neither the report nor OCIMF provided any conclusion, rating or recommendation as
to the suitability of the ship. A key feature of SIRE is that membership is entirely
voluntary.
(2). Chemical Distribution Institute (CDI) is an independent organisation with its own
statutes and it is also part of a bigger project, initiated under the Responsible Care
Programme of the European Community, concerning the distribution, transport and
storage of chemicals and gas over the road, in the air and at sea.
An important point to note is that if a deficiency found is a small one, the ship owner
(through the ships staff) is given time to have it rectified. After which, if found
satisfactory, the ship is passed. But if the deficiency is big, the ship fails the inspection
and the ship will once again be put to an entire vetting inspection to have it passed. But
under no circumstances can a ship be detained. All the failure of a vetting inspection
results in is that the oil company will not put its cargo on the vessel till such time the
vessel has passed the vetting inspection. This in itself is a big commercial loss for the
ship owner!
5.
The P & I Club organises condition surveys to enable managers to determine whether
entered ships conform to acceptable standards. These are completed on vessels for the
following reasons:
When ships over 10 yrs old are entered in the club, this can be either a pre-entry
or a post entry condition survey
If after a visit by a club inspector, the inspector feels that the ship does not
conform to the Clubs standards.
Following a claim, which could possibly have occurred due to a lapse in on board
maintenance/management
If information is received from a third party e.g. PSC that the ship is below Club
standard
If the ship changes classification societies, usually from an IACS to a non IACS
society
If after a lengthy period of lay up (6 months or more) a ship is re-activated
It is important to note that independent surveyors appointed by the ship inspection
department of a P & I Club carry out the condition surveys. It is vital in a mutual club
that each Member feels confident they are sharing their claims and premium with ship
owners of similar quality. The condition survey system is a way of ensuring this
confidence is maintained.
6.
This is a highly localised form of survey. It is entirely dependent upon the domestic and
local laws by which a particular port is governed. The objective of such an inspection is
once again to ensure that the ship will undertake the cargo operations in a safe manner
without causing any harm to the port property, its dockworkers and the environment.
The inspections can therefore include a thorough checking of the cargo equipment, the
safety measures on board in normal circumstance as well as, in emergency situations, all
the overboard discharges and the levels of communication between the ship and the port.
It is in the interest of the vessel that prior to its arrival, it confirms from the ships agent
regarding the presence of any local laws that the port is governed by for which the vessel
will have to undergo an inspection.
Conclusion
The idea here has been to educate the student on the various aspects of control measures
that a ship is put to. It is imperative to bear in mind that all of the above control measures
have become, and will get more and more enhanced in future, with the implementation of
the Safety Management System (SMS) on board under the purview of the ISM Code. The
idea is not to just prepare for a particular survey, have the vessel passed and so certified,
and then return to a casual way of doing business on board. The idea is to ensure that a
vessel is in a constant state of readiness to undertake any survey. That is the idea of
developing a safety culture on board as mentioned in my lecture on ISM Code.
Port State Control (PSC) is a ship inspection program whereby foreign vessels entering
a sovereign state's waters are boarded and inspected to ensure compliance with various
major international maritime conventions, namely:
1. International Convention for the Safety of Life at Sea (SOLAS),
2. International Convention for the Prevention of Pollution from Ships
(MARPOL), International Convention on Standards of Training Certification
and Watch keeping for Seafarer (STCW\
3. Load Lines (LL),
4. Convention on the International Regulations for Preventing Collisions at Sea
(COLREG)
5. International Labour Organization Convention No. 147 Merchant Shipping
(Minimum Standards) (ILO 147).
PSC programs are of-a regional nature; that is, several countries sharing common waters
have grouped together under a Memorandum of Understanding (MOU) to ensure that
vessels trading in their area are not substandard.
green issue, the continuing loss of seamans life is the whole nub of the issue and the
catalyst that has given strength to the arms of the ILO, IMO and the ITF in coordinating
international reaction.
Suffice to state that collectively, as will be pointed out below, the international
conventions provide the framework for port state control inspections, and without them,
and the considerable labours that precede their conclusions, port state control would have
little direction as it would have teeth.
How has the law provided the tools for the job?
To do the job, the coastal authorities need to rely upon two tools: their o\\-n "domestic"
law, and international law.
Domestic laws consist of statutes passed by parliament (and regulations promulgated
under the authority of those statutes) and the country's common law - comprising mainly
decisions of the courts and the writings of jurists.
But all states need also to rely upon a perhaps more significant body of law to come to
grips with the problem of the sub-standard ship - the International Law of the Sea.
The first recognition was given to PSC by Article 25 of UNCLOS, which empowered
states to take necessary steps to prevent the breach of conditions by vessels calling at any
port. This provided the framework upon which the subsequent conventions and
resolutions of the IMO could hang. Important to our present discussion is Resolution
A.596 (15), which pointed out that the great majority of maritime accidents are due to
human error and fallibility and that the safety of ships will be greatly enhanced by the
establishment of improved working practice.
In 1995 Resolution A.742 (18) gave content to this by allowing a port state control
inspector, who had "clear grounds" for believing that the operational condition of any
ship did not meet with the stipulations of Convention. To check on-board procedures.
Central to this was an enquiry into whether key crewmembers could communicate
adequately with one another and if the officers in charge of the navigational watch were
familiar with bridge control and navigational equipment. Thus, in these Resolutions, we
see the beginning of a focus on the human element, which departed from the previously
restricted ambit of port state control inspection that involved checking certificates and
documents only.
The legal basis for port state control of human factors is further galvanised by the ISM
Code Regulations. These Regulations apply to passenger ships, oil and chemical tankers,
bulk carriers, gas carriers and cargo high-speed craft of 500 gross tonnage and above and
to other cargo ships and mobile off shore drilling units of 500 gross tons. They outline a
system of verifications in -the form of a Document of Compliance and a Safety
Management Certificate, which must be re-validated after differential time periods as
specified in the Regulations. The code has been described as "the last chance for the
shipping industry to put its house in order, a license to operate ships, a stout cord that will
finally lasso the cowboys". It has a focus on the management system of the ship, which
includes the control of human factors.
More broad ranging authority is given to the port state authorities by the STCW. This
Convention was revised in 1995 due to a growing awareness of human factors in
shipping casualties. The resultant STCW -95 has a focus on ensuring globally
implemented minimum standards for maritime training and control of seafarers'
competency. The need for such uniformity has been stressed by the 1MO, and thus the
STCW-95 will become an important focus when addressing the problem of regulating
the human factor. Although full compliance with the revised STCW-95 is only required
by I February 2002, its content is still vital to our present discussion.
As has been mentioned, the STCW-95 saddles primary responsibility with the flag state.
Regulation 1/4 goes on to prescribe the boundaries of port state intervention. The
subordinate position of the port state is highlighted by the fact that subsection 1 of these
regulations limits the port state control to the inspection of the "appropriate certificate or
a valid dispensation". However, subsection 3 of the same Regulation demonstrates the
recognition that the port state must be given a certain degree of flexibility in order to be
able to act as an effective safety net. Thus, the subsection allows for an assessment
where "there are clear grounds for believing that such standards are not being
maintained".
Again, several prescribed categories lay out where such clear grounds exist so as to
delineate the boundaries of intervention. Again, these boundaries are blurred by the
catch-call stipulation that intervention is allowed whenever the ship is otherwise being
operated in such a manner as to pose a danger to persons, property or environment.
It is these broad categories, which provide the legal loop-hole for port state regulation
of human factors in the appropriate circumstances. This must be interpreted also to
include safety drills to demonstrate effective crew coordination and communication when
there are grounds to believe that ineffectiveness in this relation have been the cause of
dangerous operation.
Thus the adoption of the ISM Code and STCW-95 suggest that the legislation is indeed
broad enough to encompass the control of human factors through port state control.
This protection offered by the Flag State is, however, unable to provide sufficient
regulation. This is particularly true within the field of human error where an
interventionist approach to regulation is required. The problem is that it is not feasible
for the Flag State to employ a global inspectorate to ensure continued compliance with
standards across the globe. The local classification and non-exclusive marine surveyors
who are contracted out by the Flag State can only achieve a limited degree of regulation.
They work under continuous pressure from the ship owners, often in dangerous
conditions. In certain cases, unscrupulous registers that issue certificates to ships that are
clearly un-seaworthy exacerbate this lack of effectiveness. These problems are
addressed by PSC, which provides regulation that is more independent and which has
the infrastructure needed for any interactive control.
Similarly, the regulation offered by coastal state control is not broad enough to
encompass the control of human error. Such control gives to the state certain limited
powers under international law to protect its interest along that coastline. Because the
interference with ships on the high seas is particularly dangerous and inconvenient,
intervention is limited to those cases where the ship is involved in non-innocent
passage. This is defined as the passage that is prejudicial to the peace, good order, or
security of the coastal state. The regulation of human error can clearly not be effectively
implemented within the limited scope of this power.
The question then becomes whether port state control can cure the deficiencies of both
flag and coastal state control.
The MOU requires each contracting authority, within three years, to inspect an annual
total of 25% of foreign merchant ships calling at its ports. And each authority will
'consult, co-operate and exchange information' with other authorities'. Authorities should
"seek to avoid inspecting ships which have been inspected by any of the other authorities
within the previous six months unless they have clear grounds for inspection."
The 1982 Paris MOU required that PSC would be conducted without discrimination as
to flag. It also required that each state will ensure that no more favourable treatment is
given to ships flying the flag of a state not party to the MOU. As will be seen below, PSC
has matured to the stage where it now recognizes the need to accept the stark reality that
some ships pose more of a problem than others. Most MOU now allow (indeed require)
discrimination upon the basis of flag, age, type of vessel, loan owner or operator or even
known classification society.
The Paris memorandum sets out detailed guidelines as to inspection procedures and
detention. The prime purpose of detention is to ensure rectification of defects in the
vessel. In the case of deficiencies, which are clearly hazardous to safety, health or the
environment, the Authority will ensure that the hazard is removed before the ship is
allowed to proceed to sea.
For this purpose, appropriate action may be taken which may include detention or
stopping the ship from continuing an operation by reason of established deficiencies.
Which, individually or together, would render the continued operation hazardous"
Exceptions are allowed where a ship needs to proceed to a repair port. To prevent an
errant ship owner from running a detention, the MOU stipulates that such ships will be
refused access to any port within other party states, until the owner or operator has
provided evidence of rectification of the defects.
One of the most important and effective provisions of the Paris MOD is the obligation
imposed. Upon each authority to publish quarterly information about detentions under
PSC procedures. This information is required not only to contain the name of the ship.
But also the name of her owner and operator, her flag state and her classification society"
The reasons for the detention are then given".
Initially port states were reluctant to publish detention information, particularly where
owners were identified. They feared a rash of damages suits by irate ship-owners. Indeed
there have been a number of protests at the content of detention publications. But
publication has in the past three years become the norm. Let the brokers of the world
know what ships have been detained and why. Let the world's insurers know who the
miscreants are. Let the consumer, passenger or cargo shipper, know who the delinquents
are and let them avoid using substandard ships as an effective means of ridding the
oceans of their scourge. So comfortable have the port state authorities become with the
publication of detention lists that you will now find them regularly in Lloyds List (UK,
Australia, Canada arid the US, on a monthly basis) and even on the Internet. Indeed the
Internet is likely to be a very valuable co-ordinating tool in the administration of port
state control procedures in the future. It is the easiest way to access detention databases
and will certainly become the prime means of publication of detained ships in the future.
Following the lead (and largely also the letter) of the Paris MOU came the Tokyo MOU
for the Asian-Pacific Region 1993. The Tokyo MOU is up-and-running although many of
the participating states have yet to establish effective port state control facilities and
procedures.
The Vina del Mar MOU, 1992, covers the Latin American maritime authorities. This
MOU recognizes the objectives of a further regional maritime cooperation scheme and
then again repeats, largely to the letter, the provisions of the Paris MOU.
The most recent PSC system is that set up in the Caribbean on 9th February 1996 in terms
of practically identical to the Paris MOU. The UK is expected to sign the MOU on behalf
of its independent territories in the Caribbean and the MOU takes effect upon signature of
each participating country.
Other regional initiatives are on the way: the Mediterranean region has already had
preparatory meetings, and there are discussions for West and Central African and Persian
Gulf region, piloted largely by the Iranian Maritime Administration, for a further
initiative for an Indian Ocean rim. Clearly, the success of these regional MOU is
interdependence upon the efforts of each other.
Conclusion
Port state control internationally has come of age. With its roots founded in necessity
bred of successive maritime casualties, it has come into its own as the most effective
means of ridding the world's ports and oceans of sub-standard, un-seaworthy and
dangerous ships. This is not to say that international pressure on" flag states, owners and
classification societies to do their jobs properly and responsibly should be in any way
relaxed - but the reality remains that there are good and bad ship owners. There are good
and bad classification societies. And there are good and bad ship registers. Let the
international message of port state control be loud and clear - bad ships, bad owners, bad
flag states and bad classification societies are pariahs for which there should be no place
in the shipping industry of the future.
seized machinery space skylights; frozen or holed funnel dampers; engine room
ventilators.
3. Navigation Equipment
During surveys and audits, the types of findings include out-of-date, uncorrected or
missing charts for the intended voyages; inaccurately calibrated magnetic compasses;
faulty radio direction finders, echo depth sounders, radar's, gyro repeaters, and navigation
lights; outdated Tide Tables, List of Lights and Sailing Directions, etc.; and copies of
regulations (e.g., SOLAS, MARPOL, ITU etc.) not on board.
2. Documentation
Statutory certificates are issued to ships in accordance with the various international
conventions. Surveyors, auditors and inspectors have found findings related to a vessel's
certificates including expired certificates, overdue annual or intermediate surveys, and
improperly issued or missing certificates after a vessel has changed flag from one State to
another.
MARPOL Surveys
Careful attention should be paid to pollution prevention measures on board, as well as
maintaining accurate records for the handling of oil and other pollutants. Penalties can be
severe for an owner and any irresponsible crewmember if a vessel fails to comply with
the regulations. Findings noted during surveys and audits include missing oil record
keeping book or entries not up to date; poorly maintained, mis-operating or inoperative
equipment for separating oil from water including oil-content monitoring devices; sludge
tank connected directly overboard; and missing or un-posted pollution placard.
Classification Surveys
1. Hull
The findings include damage and deterioration of the hull, including items such as
distorted bulbous bow plating and side shell plating deformations; damaged gangways,
accommodation ladders, exposed walkways/platforms, and pilot ladders; corroded cable
trays and trunks; faulty closing appliances; seriously wasted, holed, cracked or fractured
side frames, transverse deck beams, deck plating, and watertight bulkheads in the chain
locker, forecastle storage space, and engine room; holed vent pipes/closure heads; holed
or damaged hatches; weather tight doors not sealing; overdue special hull surveys; and
corroded access ladders to cargo holds or tanks.
2. Machinery
Surveys that have identified poorly maintained engine rooms list findings such as
excessive oil in bilges and throughout the engine room. Other findings in this category
include inoperable remote controls on boiler safety valves; defective fuel-oil valves on
main and auxiliary engines; improperly adjusted steering gear; accumulation of water
leaking on auxiliary' engines; frozen or inoperable sea water inlet valves; defective
generators; defective and leaky fuel-oil pumps and poorly maintained air compressors
(resulting in the shortage of starting air for the main engine); leaky or wasted hydraulic
lines servicing deck machinery and cargo hatches; and leaky engine exhaust piping.
3. Cargo gear
Findings noted during surveys have included absence of identification marks on hooks,
blocks, and shackles and other small items of equipment; unavailable documentation
attesting to examinations and testing certification; excessively corroded winch bed plates;
and winch drums and brakes posing a danger and requiring repairs.
Background
During the second half of 1980s and early 1990s, there seemed to be an explosion of
maritime accidents and claims. Some of which were:
1987: Herald of Free Enterprise capsized off Zeebrugge. Extensive loss of life
1987: Dona Paz ferry collided with tanker in the Philippines estimated 4386 people
died
1989: Exxon Valdez ran aground off the coast of Alaska spilling 38,000 tonnes of oil
causing extensive environmental damage. Final claims level exceeding US $ 5 billion
1990: Scandinavian Star disaster. Extensive loss of life.
1991: Agip Abruzzo with 80000 tonnes light crude on board in collision with RO-RO
ferry Moby Prince off Livorno, Italy. Fire, pollution and 143 people died.
1991: Salem Express Egyptian ferry struck reef and sank. 470 people killed.
1992: Agean Sea broke in two off La Coruna, Spain. Extensive pollution. Claims to the
tune of US$ 200 million.
1993: Braer driven to into Shetland Islands widespread pollution. Claims in the region
of US$ 200 million.
1994: Estonia RO-RO passenger ferry sank after bow door fell off during heavy weather
at sea. Extensive loss of life.
1996: Sea Empress major oil pollution of Milford Haven, UK.
15
During the aforementioned period P & I insurance claims, and consequently the cost of P
& I insurance, rose on an average by 200 percent16. It is understood that a similar
phenomenon was experienced with Hull and Machinery claims and premium. Various
inquiries were held to ascertain as to what might be behind the problem.
The purpose of this Code is to provide an international standard for the safe
management and operation of ships and for pollution prevention.
The initial statement is expanded and the objectives are set out in full in Section 1.2 of
the Code:
1.2 Objectives
1.2.1 the objectives of the Code are to ensure safety at sea, prevention of human injury or
loss of life, and avoidance of damage to the environment, in particular to the marine
environment and to property.
1.2.2 Safety-management objectives of the Company should, inter alia:
.1
.2
.3
provide for safe practices in ship operation and a safe working environment
establish safeguards against all identifiable risks
continuously improve safety management skills of personnel ashore and on board
ships, including preparing for emergencies related both to safety and environment
protection.
1.2.3 The safety management system should ensure:
16
17
.1
.2
the Code was produced in response to potential pressure, following a number of high
profile incidents, for the shipping industry to clean up its act, the perception being that
the existing rules and regulations were not in themselves sufficient to ensure a real
diminution in the number of shipping casualties in particular it was felt there was a
need to reduce the scope of human error by imposing and industry standard of good
management.
The ISM Code is concerned with procedures whereby the safety and pollution prevention
aspects of a ship are managed, both ashore and on board, rather than laying down specific
rules on the technical condition of the ship itself.
There are of course various sets of rules, regulations and conventions dealing with the
technical issues, which a ship owner will need to comply with. The Code does not
necessarily introduce any new set of rules and regulations, but rather provides a
requirement that the SMS should be structured, such that it can check and verify
compliance with all the various rulers and regulations. A misunderstanding, which seems
frequently to arise in the minds of many people, is to think that the ISM Code has
suddenly become an all-encompassing, all-embracing piece of legislation, incorporating
all the various existing sets of rules and legislation. The Code does not incorporate them
at all, although it is a breach of the regulations that principally gives rise to exposure to
legal and insurance liabilities. What the ISM Code does is to make a requirement that the
SMS will provide procedures by which a company can check that it does comply with the
various rules and procedures to check and verify that they continue to comply. Another
important point to understand and remember is that these procedures must be documented
and recorded.
An interesting observation in this regard is made by George P. Pamborides18:
in general, the Code introduces transparency in shipping and something which will
shed light on the everyday operations of a ship, an area which up to now has remained
an exclusive privilege of the ship owner. This is now bound to change, giving access to
such information to all other interested parties. It appears that this new system has the
potential of affecting the meaning of well-established concepts like seaworthiness, due
diligence, and matters related to the limitation f liability, as well as the issue of privity
18
in insurance. It may further affect indirectly other areas, which lie entirely out of the
scope of the Code, like issues of general identification of operators.
Another interesting point is raised by Peter Martyr19, who observes:
the Code is intended to be preventative and therefore the assumption must be that it
will prevent accidents. It is not intended to provide a vehicle for punishment, although
this may well be the initial effect
If one need an explanation of why it has been considered necessary to look afresh at the
way maritime safety has been managed, which moved away from a regulatory framework
to one based on a safety culture, one would only need to reflect upon the appalling rate
of bulk carrier losses in the past years. For instance, during the period 1980 1997, there
were reportedly 167 bulk carriers lost and what is infinitely worse and unacceptable is
that 1352 lives were lost on those vessels20.
19
20
The responsibility is upon the owning or operating company to develop, implement and
maintain not only a written but dynamic safety management system covering a whole
range of safety, environmental and related matters.
Certification
The government of the state whose flag the ship is entitled to fly the Administration
is responsible for verifying compliance with the requirements of the ISM Code and for
issuing the appropriate certificates.
What is non-conformity?
It is defined as21:
21
22
First, it is the flag of the vessel, which determines the whole legal regime to which the
ship is subject. All the mandatory rules and regulations, Codes and guidelines which the
ship needs to comply and which the SMS needs to check compliance are those rules and
regulations which have been enacted by the government of the country of the flag of the
vessel.
It is indeed the responsibility of the Administration to ensure that the company does
comply with the appropriate and relevant mandatory rules and regulations and does take
into account applicable Codes and Guidelines.
It is to the Administration that the owner must report the full name and details of the
entity responsible for the operation of the ship, if different from the owner.
Delegation of authority
While the Administration is the authority for verifying compliance and issuing the DOC
and SMC, it may delegate these functions, although not the responsibility.
exercise their authority to check compliance with ISM and to impose sanctions against
those who do not comply. A brief explanation is given here.
PSC inspectors are officials representing the government of the country, which the ship is
visiting. International co-operation between PSC and consequently government in
different countries is effected through MOU.
In accordance with the provisions of SOLAS, Port State authorities can board and
conduct inspections of foreign vessels in their ports. The purpose of these inspections is
to identify deficiencies, if any, in vessels, which would render them non-compliant with
internationally, recognised safety standards and also to eliminate unfair competition.
Since ISM Code has been incorporated into Chapter IX of SOLAS, this will clearly bring
the operation of the ships SMS within the ambit of PSC. Clearly, the first thing the PSC
officer is going to request is sight of the copy of DOC and the ships SMC. The question
which obviously needs to be asked now is along the following lines: if the copy of DOC
and SMC appear to be in order, how much further can the PSC officer go to check the
ISM compliance?
Because the SMS is not a physical thing which the PSC officer can observe visually
and take a view on whether there is an indication of a serious deficiency. Certainly it is
relatively easy task for an inspector to look at the portable fire extinguishers and form a
view on whether they appear to be properly maintained and serviced. That they are clean,
accessible and carry a label stating when they were last tested and/or re-charged. If there
is something, which causes him concern, then he is likely to ask for one of the
extinguishers to be discharged.
Certainly one way to proceed further by the PSC officer in checking the SMS is to
observe, for example, a portable fire extinguisher which is perhaps dirty or has passed its
recharge/test date. The PSC officer may pick a member of the crew at random and ask
him to set off an extinguisher. The PSC officer may then ask to see the relevant
procedures manual and the particular procedure dealing with the inspection, care and
maintenance of the portable fire extinguishers and will then be on a paper audit trail to
establish whether those written procedures are being followed. This process should reveal
the records as well as, corrective actions taken to rectify the system in this regard
including the companys verification. He may also see the planned maintenance
procedures relevant to the portable fire extinguishers. He may ask to see the
familiarisation and training procedures and ask to see those records for the present crew
to confirm that they have received familiarisation and training in the use of portable fire
extinguishers. If problems start to come to light while following the audit trails then
clearly the PSC officer is likely to expand his investigation into the functioning of the
SMS.
As a consequence of that incident all the ships in the management fleet were reminded to
ensure that in port they did need to maintain their ability to respond to an emergency in
just the same way as if they were at sea, an account needed to be taken of manning levels
and the state of readiness.
The important point is that it may be relatively cheap both in respect of time and money
to have a portable fire extinguisher recharged or to have the crew practice an emergency
drill exercise there may not be a quick fix solution when it comes to considering a
serious deficiency in the SMS.
Monitoring the safety and pollution prevention aspects of the operation of each
ship
Ensuring that needed resources and shore-based support are applied as required
Within the context of these two guidelines the DP also has responsibility:
One important aspect to understand is that the Master still remains in command and the
requirements of the ISM Code do not override that position. The Master holds one of the
most important roles within the SMS of the ISM Code. Unless the Master can motivate
his officers and crew to actually implement the SMS and allow it to function as it was
intended, then the whole project will be nothing more that a few thousand words on
pieces of paper in procedures manuals but there will be no SMS.
What a Master is required to do is to have a good contemporaneous documented evidence
of a fully functional SMS that will include details all reports of accidents,
non-conformities and hazardous occurrences, details of safety meetings on board, training
and familiarisation on board and communications with the DP.
countries. A company should therefore have the following procedures with respect to
recruitment and manning in context of the SMS:
The trade in which the ship is engaged and the workload on the crew
The skills required by the crew for the safe execution of the tasks they are
expected to perform
The awareness of the crew with respect to their SMS duties
The availability of records of qualification and medical fitness
Training and familiarisation
A company will now have to consider methods of training and familiarisation when
determining ways to ensure that new personnel transferred to new assignments are made
aware of their responsibilities under SMS. The following is a suggestive list to bring
home the point to the student:
Give information of companys SMS and the ships details to the seafarer prior to
joining the ship
Provide for familiarisation once the seafarer is on board regarding the equipment
and SMS
Have the seafarer answer a questionnaire once his familiarisation is complete on
board after arrival
The above should include video familiarisation packages whether ashore or on board
regarding the vessels SMS
Shipboard organisation
Functional responsibilities
Reporting procedures
Communications between ship and the company
Inspections by master and senior officers
Provisions and maintenance of documents and records
Medical arrangements
Fitness of duty and avoidance of excessive fatigue
Alcohol and other drug policies
Checklist for seaworthiness and cargo worthiness
Accepting cargo
Loading and discharging procedures, including those related to dangerous goods
Harbour watches and patrols
Liaison with shore authorities
Monitoring trim and stability
Procedures when the ship is temporarily immobilised
Accidental spillage of cargo or bunkers
Use of reception facilities for oil, NLS or garbage
Response to pollution incidents
Control testing
Port information and communications
Pilotage information
Assessment of weather conditions
Sailing directions, tide tables and charts
Ballast conditions
Stability and watertight integrity
Emergency preparedness
The other proactive requirement on the company under the code arises under Section 8 of
the Code, which is aimed at the anticipation of a risk and the subsequent risk assessment
exercise to identify potential emergency situations that may arise. Thereafter how such an
emergency would be dealt with should they arise.
Reporting
Reporting and analysing accidents, non-conformities and hazardous occurrences form the
backbone of the SMS within a company. The reporting loop includes reports on learning
from experience. This is only possible when there is a reporting feedback loop. This
would usually be by means of a written response:
First there were those who adopted an approach, which can be summed up as, if it aint
broke dont fix it! This could be termed as the breakdown policy!
The second approach could be described as the planned maintenance policy. This is the
preventive approach such that the equipment will be overhauled or changed, if required,
before it broke down.
It is quite probable that the introduction of the planned maintenance schemes has been the
single biggest expense of the ISM implementation. This is also an area that can be, in
times of poor charter markets, where corners can be cut. However, it is also an area
where a lacuna is easiest to detect. PSC will always target this system and over a period
of time be able rid the industry of cutting corners in this area. Therefore, the planned
maintenance system also is an important component of the SMS on board.
Basic non-compliance with the ISM Code (Chapter IX of SOLAS) with the risk
of losing the DOC and SMC
Failure to be able to demonstrate due diligence to make the vessel seaworthy
Possible loss of rights to limit financial liability
Possible loss of insurance cover
Case study
The Marion is a very interesting case when considering the potential relevance of ISM
related issues from a number of perspectives, although there are two, which stand out
specifically:
The necessity to have procedures in place to check that what should be done is
actually being done
The necessity for important information relating to safety issues on board to be
referred to senior management ashore
The incident itself occurred more than 20 years before any ISM compliance dates were
on the horizon. However, the case seemed to anticipate much of what was to develop by
way of the philosophy behind the ISM Code.
What happened on the Marion that led to a claim in excess of US$ 25 million?
On March 14, 1977 the Liberian registered tanker, Marion, came to anchor in a position
about 2.7 miles of the Heugh which was about one mile from the Tees Fairway buoy off
Hartpool in the UK. On 18 March Marion attempted to weigh her anchor. She was unable
to do so because her anchor had fouled an oil pipeline, which ran submarine. The pipeline
was severely damaged by Marions anchor. The owners of the pipeline and other
companies who contended that they had suffered loss by reason of the damage to the
pipeline claimed damages in excess of US$ 25 million.
The managers of the Marion had admitted that the damage to the pipeline had been
caused partly by the negligence of their servant, the Master. The Master had anchored
close to the pipeline although he was unaware of its existence because he was navigating
with a chart that was very seriously out-of-date and uncorrected. The up-to-date chart had
the presence of the pipeline. Such a chart was in fact in the chartroom but he decided to
use the old chart.
The owners, on accepting the fault of their servant, the Master, wanted to limit their
liability to about US$ 1 million. The issue to be discussed by the court was that whether
the fault occurred without the actual fault of the ship managers. If that was the case they
could limit their liability, otherwise they were liable to pay US$ 25 million.
The management team of Marion ashore comprised of a managing director, an operations
manager, an assistant operations manager and engineer superintendent. The management
team was experienced and well qualified but only the managing director was in the frame
as far as the question of fault and privity is concerned. The Master too was very
experienced and an old hand with the company. The company had arrangements for
up-to-date charts to be provided as well as, notices to mariners on a regular basis. It was
basically the eccentricity of the Master that he had great affection to use old charts rather
than new ones!
What had also happened was that the practice of use of old and uncorrected charts was
pointed by the flag state inspection in its report. The report was sent to the Company.
When the report arrived, the managing director was out of country. However, the
operations manager and the assistant manager did read the report and informed the
Master to change the practice of using old charts and ensure that the charts are up to date
and corrected henceforth. What they did not do was to inform the managing director on
his return. In fact the Liberian inspectors report was lying among his many papers and he
came to know about the report only when the incident occurred and the claim was made
against the company.
The court picked up a number of points:
The master did not acknowledge the receipt of the letter from the operations
manager and no follow up action was taken
The court was critical that regardless of what the procedures might be, ship
managers did not have procedures in place to check that the master was indeed
following the correct procedures. It was felt by the court that the activities of the
Master, or the lack of it, should have been checked by the company.
The Liberian safety inspectors report had been left on the managing directors
table. The court was also particularly critical of the managing director for not
having procedures in place whereby his line managers would bring such
important matters to his attention. The court therefore concluded that it was
indeed the managing directors own fault that he was not told about the report and
consequently constituted that the incident occurred by the actual fault of the
managers.
Now, the ISM angle to this incident
The line of reasoning on part of the court suggests of what might be expected of the
Designated Person, or what the courts might expect of the most senior levels of
management, when considering what the DP should be reporting to them and ensure that
it is actually conveyed. Those most senior members of the management must make it
very clear indeed, not only to the DP, but also to other members of their management
team, that they need to be told of any adverse reports coming in that might have an
adverse effect on the safety of the ship. For, failing to do so they will be condemned by
the court of law for not having procedures in place and held responsible for such fault and
thereby losing their right to limit their financial liability and also the insurance cover.
The use, maintenance and correction of navigational charts should be subject to internal
audits by personnel external to the bridge (internal audits of the company). With a
properly functioning SMS the bad practices of the Master would have been picked up at
an early stage, by one or the other means, the situation should have been remedied.
At the end of the day, the ship managers of Marion were unable to limit their liability and
therefore ended up paying in excess of US$ 25 million. This is because, in a nutshell:
They did not have procedures in place for the most senior levels of management
to be advised of major safety issues relating to their vessels
They did not have procedures in place to verify, review and evaluate safety
related activities on board their vessels
Clearly, post ISM Code implementation, a properly implemented and functioning
SMS will fully protect the owners in these types of situations.
Conclusion
It could certainly be suggested that having a SMS in place and, more importantly,
functional in line with ISM Code requirements the damage can be picked up at an early
stage (as shown in the case study above) and remedial action taken long before it can be
converted into an incident and a possibility of loss of cover for the owner or the operator.
A properly implemented and functioning SMS not only adds to the safety on board and
contributes towards the protection of the marine environment but it also fully protects the
owners.
IAMSAR
London Convention
OPRC
Ratification
ILO member states are required to submit any convention adopted at the International
Labour Conference to their national competent authority for the enactment of relevant
legislation or other action, including ratification. An adopted convention normally comes
into force 12 months after being ratified by two member states. Ratification is a formal
procedure whereby a state accepts the convention as a legally binding instrument. Once it
has ratified a convention, a country is subject to the ILO regular supervisory system
responsible for ensuring that the convention is applied. Reservations to ILO conventions,
however, are not permitted.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
In addition, the competent administrative authority must be satisfied that measures for the
effective control of other shipboard conditions of employment and living arrangements,
where it has no effective jurisdiction, are agreed between the organizations of shipowners and of seafarers.
Under ILO 147, a ratifying flag State further undertakes to ensure that adequate
procedures exist for the engagement of seafarers on ships registered in its territory and for
the investigation of complaints arising in that connection, and for the investigation of any
complaint made in connection with the engagement in its territory of seafarers of its own
nationality on ships registered in a foreign country. It also undertakes to ensure that any
complaint made in connection with the engagement in its territory of foreign seafarers on
ships registered in a foreign country is reported to the competent authority of the country
in which the ship is registered.
Moreover, ratifying flag States must ensure that the competent authority verifies, by
inspection or other appropriate means, that nationally registered ships comply with
national laws and regulations which apply the standards prescribed by the Convention,
other applicable international labour conventions in force which they have ratified, and,
as appropriate under national law, applicable collective agreements.
Labour Office. In addition, the port State can take action, including detention, to rectify
any conditions on board which are clearly hazardous to safety or health, even if the ship
is registered in a country, which is not bound by the Convention. In taking such action,
the ratifying port State must notify the nearest maritime, consular or diplomatic
representative of the flag State and must, if possible, have such a representative present.
It must not unreasonably detain or delay the ship.
To bring home the point, let us further take the case of USA. While Article 4 prescribes
port state control, intervention under this treaty can only take place using existing U.S.
laws. The local laws of USA allows the Captain of the Port (COTP) to detain a vessel if it
is not in compliance with an applicable treaty, provided the vessel poses a serious threat
to the port. This authority may be used to detain any vessel registered by flag
administrations, which are also party to ILO 147. The general goals of ILO 147 may be
used as a reference to measure the threat to the port. The local laws may also be used to
detain vessels of non-party states as long as the deficiencies are serious enough to pose a
threat to navigation, vessel safety, and the environment. It is however important to note
that vessels registered to non-party states may be the subject of port state control, but not
by the standards of ILO 147.
The PSC inspector will investigate complaints and associated evidence of deficiencies
relating to:
(a) Minimum age requirements;
(b) Medical examinations of the crew;
(c) Accident prevention and occupational safety and health;
(d) Crew accommodations;
(e) Hospital space;
(f) Food and catering; and,
(g) Minimum manning standards and certification. (Considering relevant Port State
Guidance relating to SOLAS and STCW.)
(2) The following types of deficiencies should be forwarded to the DOL for appropriate
action:
(a) Seamans' articles of agreement;
(b) Liability for sick or injured seamen;
(c) Repatriation of seamen;
(d) Freedom of association
(e) Protection of the right to organize; and,
(f) Collective bargaining.
The following control action applies to vessels whose flag administrations are party to
ILO 147:
When conditions, which are clearly hazardous to safety or health, are discovered,
and for which no other applicable international maritime safety treaty (i.e.,
SOLAS, MARPOL, etc.) establishes a regulatory requirement, the PSC inspector
Conclusion
The juxtaposition of ILO 147 and relevant recommendations ensures that the standards of
the former are not regarded as anything more than minimum ones. The "substantially
equivalent" approach of ILO147 involves an additional element of flexibility, as it is not
regarded as essential to meet the standards of the Conventions listed in the Appendix, in
all respects. The ILO Committee of Experts has laid particular emphasis here on the
criteria of safety and health; and on the need for adequate social security measures to be
applied to seafarers working on nationally registered ships. By contrast, the role of the
recommendations is a promotional one, as it calls for measures going beyond the
minimum to reach standards "at least equivalent" to those contained in the appendix to
ILO147.
Each Member for which this Convention is in force shall issue to each of its
nationals who is a seafarer and makes an application to that effect a seafarers'
identity document conforming to the provisions of the Convention
Unless otherwise provided for in this Convention, the issuance of seafarers'
identity documents may be subject to the same conditions as those prescribed by
national laws and regulations for the issuance of travel documents
Each Member may also issue seafarers' identity documents to seafarers who have
been granted the status of permanent resident in its territory
Each Member shall ensure that seafarers' identity documents are issued without
undue delay
Seafarers shall have the right to an administrative appeal in the case of a rejection
of their application
It shall contain the name of the issuing State and the following statement:
Data to be entered on the data page(s) of the seafarers' identity document shall be
restricted to:
Issuing authority
Telephone number(s), email and web site of the authority
Date and place of issue
Full name of seafarer: where applicable, family name shall be written first,
followed by the seafarer's other name
Sex
Date and place of birth: the date shall be written in two-digit Arabic numerals in
the form day/month/year; the place shall be written in the same way as on the
national passport;
Statement of nationality
Special physical characteristics: any evident characteristics assisting identification
Signature of seafarer
Date of expiry: in two-digit Arabic numerals in the form day/month/year
Type or designation of document: character code for document type, written in
capitals in the Roman alphabet
Unique document number: country code followed by an alphanumeric book
inventory number of no more than nine characters
Personal identification number: optional personal identification number of the
seafarer; identification number of no more than 14 alphanumeric characters
Issuing authority
ISO code for the issuing State and the name and full address of the office issuing
the seafarers' identity document as well as the name and position of the person
authorizing the issue
The telephone number, email and web site shall correspond to the links to the
focal point referred to in the Convention
Date and place of issue: the date shall be written in two-digit Arabic numerals in
the form day/month/year - e.g. 31/12/03; the place shall be written in the same
way as on the national passport
Explanation of data
The captions on fields on the data page(s) above may be translated into the
language(s) of the issuing State. If the national language is other than English,
French or Spanish, the captions shall also be entered in one of these languages
The Roman alphabet should be used for all entries in this document
The form of the document and the materials used in it shall be consistent with the
general specifications set out in the model, which shall be based on the criteria set
out below. The seafarers' identity document shall be designed in a simple manner,
be made of durable material, with special regard to conditions at sea and be
machine-readable. The materials used shall:
(a) Prevent tampering with the document or falsification, as far
as possible, and enable easy detection of alterations; and
(b) Be generally accessible to governments at the lowest cost
consistent with reliably achieving the purpose set out in (a)
above.
Members shall take into account any available guidelines developed by the
International Labour Organization on standards of the technology to be used
which will facilitate the use of a common international standard
The seafarers' identity document shall be no larger than a normal passport
The seafarers' identity document shall contain the name of the issuing authority,
indications enabling rapid contact with that authority, the date and place of issue
of the document.
The maximum validity of a seafarers' identity document shall be determined in
accordance with the laws and regulations of the issuing State and shall in no case
exceed ten years, subject to renewal after the first five years
All data concerning the seafarer that are recorded on the document shall be
visible. Seafarers shall have convenient access to machines enabling them to
inspect any data concerning them that is not eye-readable. Such access shall be
provided by or on behalf of the issuing authority.
Each Member shall ensure that a record of each seafarers identity document
issued, suspended or withdrawn by it is stored in an electronic database. The
necessary measures shall be taken to secure the database from interference or
unauthorized access. The details to be provided for each record in the electronic
database to be maintained by each Member shall be restricted to:
The information contained in the record shall be restricted to details which are
essential for the purposes of verifying a seafarers' identity document or the status
of a seafarer and which are consistent with the seafarer's right to privacy and
which meet all applicable data protection requirements
Each Member shall put in place procedures which will enable any seafarer to
whom it has issued a seafarers' identity document to examine and check the
validity of all the data held or stored in the electronic database which relate to that
individual and to provide for correction if necessary, at no cost to the seafarer
concerned
Each Member shall designate a permanent focal point for responding to inquiries,
from the immigration or other competent authorities of all Members of the
Organization, concerning the authenticity and validity of the seafarers' identity
document issued by its authority. Details of the permanent focal point shall be
communicated to the International Labour Office, and the Office shall maintain a
list which shall be communicated to all Members of the Organization
The details mentioned above shall at all times be immediately accessible to the
immigration or other competent authorities in member States of the Organization,
either electronically or through the focal point
Members shall ensure that the personal data on the electronic database shall not
be used for any purpose other than verification of the seafarers' identity document
What will be the quality control and what type of evaluations undertaken?
Processes and procedures are in place to ensure the necessary security through the
quality control of procedures and periodic evaluations, including the monitoring
of processes, to ensure that required performance standards are met, for:
(i) Production and delivery of blank SID
(ii) Custody, handling and accountability for blank, voided and personalized
SID
(iii) Processing of applications, completion of blank SID into personalized
SID by the authority and unit responsible for issuance and delivery,
(iv) Operation, security and maintenance of the database.
(b) Periodic reviews are carried out to ensure the reliability of the issuance
system and of the procedures and their conformity with the requirements of
this Convention.
(c) Procedures are in place to protect the confidentiality of information
contained in reports on periodic evaluations provided by other ratifying
Members.
The issuing authority should ensure that all officials with responsibility
concerning the review of applications for SID have received relevant training in
fraud detection and in the use of computer technology
The issuing authority should draw up rules ensuring that SID are issued only on
the basis of: an application completed and signed by the seafarer concerned; proof
of identity; proof of nationality or permanent residence; and proof that the
applicant is a seafarer
The application form should require applicants to note that they will be liable to
prosecution and penal sanctions if they make any statement that they know to be
false.
When a SID is first applied for, and whenever subsequently considered necessary
on the occasion of a renewal:
The proof of identity provided by the applicant should be in accordance with the
laws and practice of the issuing State. It may consist of a recent photograph of the
applicant, certified as being a true likeness of him or her by the ship owner or
shipmaster or other employer of the applicant or the director of the applicant's
training establishment.
Applicants should be asked to declare all other nationalities that they may possess
and affirm that they have not been issued with and have not applied for a SID
from any other Member.
The applicant should not be issued with a SID for so long as he or she possesses
another SID.
What is the relationship between SID and shore leave and transit and transfer of
seafarers?
Shore leave
Any seafarer who holds a valid seafarers' identity document issued in accordance
with the provisions of this Convention by a Member for which the Convention is
in force shall be recognized as a seafarer within the meaning of the Convention
unless clear grounds exist for doubting the authenticity of the seafarers' identity
document.
Each Member for which this Convention is in force shall, in the shortest possible
time, and unless clear grounds exist for doubting the authenticity of the seafarers'
identity document, permit the entry into its territory of a seafarer holding a valid
seafarer's identity document, when entry is requested for temporary shore leave
while the ship is in port.
Such entry shall be allowed provided that the formalities on arrival of the ship
have been fulfilled and the competent authorities have no reason to refuse
permission to come ashore on grounds of public health, public safety, public order
or national security.
For the purpose of shore leave seafarers shall not be required to hold a visa. Any
Member which is not in a position to fully implement this requirement shall
ensure that its laws and regulations or practice provide arrangements that are
substantially equivalent.
Each Member for which this Convention is in force shall, in the shortest possible
time, also permit the entry into its territory of seafarers holding a valid seafarers'
identity document supplemented by a passport, when entry is requested for the
purpose of:
(a) Joining their ship or transferring to another ship;
(b) Passing in transit to join their ship in another country or
for repatriation; or any other purpose approved by the
authorities of the Member concerned.
Such entry shall be allowed unless clear grounds exist for doubting the
authenticity of the seafarers' identity document, provided that the competent
authorities have no reason to refuse entry on grounds of public health, public
safety, public order or national security.
Any Member may, before permitting entry into its territory for one of the
purposes specified above, require satisfactory evidence, including documentary
evidence of a seafarer's intention and ability to carry out that intention. The
Member may also limit the seafarer's stay to a period considered reasonable for
the purpose in question.
The seafarers' identity document shall remain in the seafarer's possession at all
times, except when it is held for safekeeping by the master of the ship concerned,
with the seafarer's written consent.
The seafarers' identity document shall be promptly withdrawn by the issuing State
if it is ascertained that the seafarer no longer meets the conditions for its issue
under this Convention. Procedures for suspending or withdrawing seafarers'
identity documents shall be drawn up in consultation with the representative ship
owners' and seafarers' organizations and shall include procedures for
administrative appeal.
Comparison between USA crewmember visa and ILO 185 - Seafarers Identity
Document
Who Issues?
Who Must
Possess?
Exceptions
Physical
Requirements
Duration of
Validity
Interview
Background
Checks
Travel Document
Identification
While Ashore
Database
Shore Leave
Verification of
Biometrics
IAMSAR
IAMSAR Manual
IMO: IAMSAR Manual: International aeronautical and maritime search and rescue
manual. Jointly published by IMO and the International Civil Aviation Organization
(ICAO), the three-volume IAMSAR Manual provides guidelines for a common aviation
and maritime approach to organizing and providing search and rescue (SAR) services.
Each volume can be used as a standalone document or, in conjunction with the other two
volumes, as a means to attain a full view of the SAR system. SOLAS chapter V Safety of
Navigation requires ships to carry an up-to-date copy of Volume III of the International
Aeronautical and Maritime Search and Rescue (IAMSAR) Manual.
The IAMSAR manual is divided into three volumes:
The Mobile Facilities volume (volume III) is intended to be carried aboard rescue units,
aircraft, and vessels to help with performance of a search, rescue, or on-scene
co-ordinator function and with aspects of SAR that pertain to their own emergencies.
Purpose
The purpose of the International Aeronautical and Maritime Search and Rescue Manual
for Mobile Facilities, which is intended for carriage aboard search and rescue units, and
aboard civil aircraft and vessels, is to provide guidance to those who:
Operate aircraft, vessels or other craft, and who may be called upon to use the
facility to support SAR operations
May need to perform on-scene co-ordinator functions for multiple facilities in the
vicinity of a distress situation
Experience actual or potential emergencies, and may require search and rescue
(SAR) assistance
Responsibilities and Obligations to Assist
Under long-standing traditions of the sea and various provisions of international law, ship
masters are obligated to assist others in distress at sea whenever they can safely do so.
The responsibilities to render assistance to a distressed vessel or aircraft are based on
humanitarian considerations and established international practice. Specific obligations
can be found in several conventions, including the following:
An alarm signal or a distress call from another vessel at sea, either directly or by
relay.
A distress call or message from aircraft. This usually occurs by relay from a CRS
Alert sent from a vessel's alerting equipment and then relayed shore-to-ship
Visual signals or sound signals from a nearby distressed craft
Immediate Action
The following immediate action should be taken by any ship receiving a distress
message:
On-Board Preparation
A vessel en route to assist a distressed craft should have the following equipment ready
for possible use:
Life-saving and rescue equipment:
Lifeboat, inflatable life-raft, lifejackets, survival suits for the crew, lifebuoys, breeches,
buoys, portable VHF radios for communication with the ship and boats deployed,
line-throwing apparatus, buoyant lifelines, hauling lines, non-sparking boat hooks or
grappling hooks, hatchets, rescue baskets, pilot ladders, scrambling nets, copies of the
International Code of Signals, radio equipment operating on MF/HF and/or VHF/UHF
and capable of communicating with the SMC and rescue facilities, and with a facility for
direction finding (DF), supplies and survival equipment as required, fire-fighting
equipment, portable ejector pumps, binoculars, cameras, bailers and oars.
Signalling equipment:
Signalling lamps, searchlights, torches, flare pistol with colour-coded signal flares,
buoyant VHF/UHF marker beacons, floating lights, smoke generators, flame and smoke
floats, dye markers, loud hailers.
Preparations for medical assistance, including:
Stretchers, blankets, medical supplies and medicines, clothing, food, shelter
Miscellaneous equipment:
If fitted, a gantry crane for hoisting on each side of ship with a cargo net for recovery of
survivors, line running from bow to stern at the water's edge on both sides for boats and
craft to secure alongside, on the lowest weather deck, pilot ladders and manropes to assist
survivors boarding the vessel, vessel's lifeboats ready for use as a boarding station,
Line-throwing apparatus ready for making connection with either ship in distress or
survival craft, Floodlights set in appropriate locations, if recovery at night.
In a distress incident, even uninjured persons who are supposedly able-bodied and
capable of logical thought are often unable to accomplish simple tasks and may hinder
their own rescue.
Clothing or other objects lying about should be cleared away or secured due to
strong air-wind current from the helicopter.
The helicopter may be able to lift a person from a lifeboat or a life-raft secured on
a long painter. However, life-rafts have been overturned by the helicopter's aircurrent
Safety Preparations
A briefing to discuss the safety aspects and operational details of helicopter-ship
operations should be held for all involved personnel prior to the operation's
commencement. Wherever available, the following fire-fighting equipment or its
equivalent should be ready during helicopter operations:
At least two dry powder extinguishers with an aggregate capacity of not less than
45 kg
A suitable foam application system (fixed or portable), capable of delivering a
foam solution at a rate of not less than 6 litres per minute for each square metre of
clear zone and sufficient foam compound to enable the rate to be maintained for at
least five minutes
Carbon Dioxide (CO2) extinguishers with an aggregate capacity of not less than
18 kg & a deck water system capable of delivering at least two jets of water to
any part of the helicopter operating area at least two fire hose nozzles which
should be of the dual-purpose type
Fire-resistant blankets and gloves
Sufficient fire proximity suits
Portable fire-fighting equipment for oil fires should be stationed near the
disembarkation space
If possible, the fire-fighting pump should be started and hoses should be
connected and kept in readiness
For better identification from the air, and also for showing the direction of the
wind to the helicopter pilot, flags and pennants should be flown
All crew members concerned, as well as the persons to be evacuated, should wear
lifejackets
Rescue by Maritime Facilities
General Maritime Considerations
For survivors in the water, the rescuing vessel may find it necessary to:
For a fire or extremely heavy weather, or where it is impossible for the rescue ship to
come alongside, then a lifeboat or life-raft may be towed to a closer position.
In heavy weather, the use of oil for reducing the effect of the sea should be considered.
Experience has shown that vegetable oils and animal oils, including fish oils, are most
suitable for quelling waves lubricating oils may be used. Fuel oil should not be used,
except as a last resort, as it is harmful to persons in the water. Lubricating oil is less
harmful, and tests have shown that 200 litres discharged slowly through a rubber hose
with an outlet just above the sea, while the ship proceeds at slow speed, and can
effectively quell a sea area of some 5,000 square metres.
In heavy weather, a ship with a low freeboard may be better suited to affect rescue. . A
boarding station may be rigged by mooring a life-raft alongside.
The direction of approach to the distressed craft (or survivors) will depend upon
circumstances. Some emergencies, such as a ship on fire, may have to be approached
from windward and others, such as life-rafts, from leeward.
The two key factors are:
Whether a lee-side protection is necessary during the rescue operation and
The comparative rates of drift of the distressed craft and the rescuing ship.
Debriefing of Survivors
Survivors should be questioned about the distressed craft as soon as possible. Their input
may be able to further assist in the SAR operation, future SAR operations, or the
prevention of incidents in the future. The information should be relayed to the SMC.
Questions to ask include the following:
Were any signals or devices used to try to attract the attention of search craft? If
so, what were they and when were they used?
Survivors should also be questioned about their medical history:
Recurring disease
Heart trouble
Diabetes
Epilepsy
Conditions from which they may suffer
This information should be noted, together with any medical attention given, for future
attending physicians.
The questioning of survivors has the following purposes:
OSC Duties
The duties are:
If several facilities will be searching at the same time, divide the square into subareas of the appropriate size and assign search facilities accordingly
Search Patterns
Expanding Square Search (SS)
This type is most effective when the location of the search object is known within
relatively close limits
The commence search point is always the datum position
Often appropriate for vessels or small boats to use when searching for persons in
the water or other search objects with little or no leeway
Due to the small area involved, this procedure must not be used simultaneously by
multiple aircraft at similar altitudes or by multiple vessels
Accurate navigation is required; the first leg is usually oriented directly into the
wind to minimize navigational errors
It is difficult for fixed-wing aircraft to fly legs close to datum if S is less than 2
NM
Sector Search (VS)
This is most effective when the position of the search object is accurately known
and the search area is small. . Used to search a circular area centred on a datum
point
Due to the small area involved, this procedure must not be used simultaneously by
multiple aircraft at similar altitudes or by multiple vessels
An aircraft and a vessel may be used together to perform independent sector
searches of the same area
A suitable marker (for example, a smoke float or a radio beacon) may be dropped
at the datum position and used as a reference or navigational aid marking the
centre of the pattern
For aircraft, the search pattern radius is usually between 5 NM and 20 NM
For vessels, the search pattern radius is usually between 2 NM and 5 NM
Track Line Search (TS)
This is normally used when an aircraft or vessel has disappeared without a trace
along a known route
Often used as initial search effort due to ease of planning and implementation
Consists of a rapid and reasonably thorough search along intended route of the
distressed craft
Search may be along one side of the track line and return in the opposite direction
on the other side (TSR)
Search may be along the intended track and once on each side, then search facility
continues on its way and does not return (TSN).
Aircraft are frequently used for TS due to their high speed.
Many hope the Conventions standards will spur scientific research to develop sufficient
technologies and the data needed to effectively manage ballast water to the prescribed
standards before the Conventions deadlines. Vessels participating in a program approved
by the IMO to test and evaluate promising ballast water treatment technologies will be
given a 5 year grace period before having to comply with applicable standards.
Nations that are party to the Convention are given the right to implement additional, more
stringent measures than are provided in the Convention, to prevent, reduce, or eliminate
the transfer of harmful aquatic organisms and pathogens.
The Conventions ballast water management regulations would apply to both port nations
and flag nations under whose authority a vessel operates, which ratify the Convention. As
a result, whether or not the U.S. ratifies the Convention, U.S.-flagged vessels equipped
with ballast water tanks that call on ports in nations that have ratified it will likely be
subject to the requirements of the Convention after it enters into force. In addition, if
Canada or the U.S. ratifies the Convention and it enters into force, vessels that ply trade
in the Great Lakes and between Alaska and the continental United States also would be
subject to the IMO regulations, as these vessels move between U.S. and Canadian waters
en route to their destinations. Otherwise, U.S. coastwise trade would be unaffected by the
IMO Convention.
The Convention will enter into force if 12 months after the date on which at least 30
nations, representing more than 35 per cent of world merchant shipping tonnage, ratify it.
Further details of the Convention are described in the Appendix attached to this
memorandum.
Vessels also must have a Ballast Water Record Book to record when ballast water is
taken on-board, circulated, or treated for ballast water management purposes, and
discharged into the sea.
The Conventions ballast water management regulations would apply both to U.S.flagged vessels equipped with ballast water tanks that undertake international voyages
and internationally flagged vessels that call on U.S. ports. Under current interpretation,
vessels that ply trade in the Great Lakes and between Alaska and the continental United
States also would be subject to the IMO regulations, as these vessels enter extraterritorial
waters en route to their destinations. Otherwise, coastwise trade would be unaffected by
the IMO Convention.
Class of Organisms
Intestinal Enterococci
<100 colony forming unit per 100 millilitres
(0.1 litre) of ballast water.
B. Compliance Deadlines.
The Convention specifies deadlines for meeting the standards. The IMO developed a
complicated timeline by which new and existing vessels will be required to meet the
standards:
Those with a ballast water capacity of >5000 m3, and constructed in or after 2012,
are to conduct ballast water management that meets the ballast water performance
standard.
Introduction
The Civil Liability Convention was adopted to ensure that adequate compensation is
available to persons who suffer oil pollution damage resulting from maritime casualties
involving oil-carrying ships.
The Convention places the liability for such damage on the owner of the ship from which
the polluting oil escaped or was discharged.
24
The details of the amounts that the ship owner was able to limit his liability are deliberately not being
mentioned here since the amounts have been changed by later amendments. The final amounts as it stands
today have been mentioned later under the relevant section. Mention of the old and new amounts, at
different places would have resulted in confusion.
The Convention applies to all seagoing vessels actually carrying oil in bulk as cargo, but
only ships carrying more than 2,000 tons of oil are required to maintain insurance in
respect of oil pollution damage.
The Convention covers pollution damage resulting from spills of persistent oils suffered
in the territory (including the territorial sea) of a State Party to the Convention. It is
applicable to ships, which actually carry oil in bulk as cargo, i.e. generally laden tankers.
Spills from tankers in ballast or bunker spills from ships other than other than tankers are
not covered, nor is it possible to recover costs when preventive measures are so
successful that no actual spill occurs25. The ship owner cannot limit liability if the
incident occurred as a result of the owner's personal fault.
Channelling of liability
Claims for pollution damage under the 1992 Civil Liability Convention can be made only
against the registered owner of the tanker concerned.
1992 Protocol was drawn up in such a way that the ratification of the United States was
not needed in order to secure entry into force conditions.
27
EEZ extends to 200 nautical miles from the base line of a country as defined under UNCLOS.
For a ship not exceeding 5,000 gross tonnage, liability is limited to 4.51 million SDR
(US$ 6.5 million)
(Under the 1992 Protocol, the limit was 3 million SDR (US$ 4.33 million)
For a ship 5,000 to 140,000 gross tonnage: liability is limited to 4.51 million SDR (US$
6.5 million) plus 631 SDR (US$ 911) for each additional gross tonne over 5,000 (Under
the 1992 Protocol, the limit was 3 million SDR (US$ 4.33 million) plus 420 SDR
(US$606) for each additional gross tonne)
For a ship over 140,000 gross tonnage: liability is limited to 89.77 million SDR (US$
129.5 million)
(Under the 1992 Protocol, the limit was 59.7 million SDR (US$ 86.2 million)
Some States objected to the regime established, since it was based on the strict liability of
the ship owner for damage, which they could not foresee and, therefore, represented a
dramatic departure from traditional maritime law, which based liability on fault. On the
other hand, some States felt that the limitation figures adopted were likely to be
inadequate in cases of oil pollution damage involving large tankers. They therefore
wanted an unlimited level of compensation or a very high limitation figure.
In the light of these reservations, the 1969 Brussels Conference considered a compromise
proposal to establish an international fund, to be subscribed to by the cargo interests,
which would be available for the dual purpose of, on the one hand, relieving the ship
owner of the burden by the requirements of the new convention and, on the other hand,
providing additional compensation to the victims of pollution damage in cases where
compensation under the 1969 Civil Liability Convention was either inadequate or
unobtainable.
The Conference recommended that IMO should prepare such a scheme. The Legal
Committee accordingly prepared draft articles and the International Convention on the
Establishment of an International Fund for Compensation for Oil Pollution Damage was
adopted at a Conference held in Brussels in 1971. It is supplementary to the 1969 Civil
Liability Convention.
The purposes of the Fund Convention are:
To provide compensation for pollution damage to the extent that the protection
afforded by the 1969 Civil Liability Convention is inadequate.
To give relief to ship owners in respect of the additional financial burden imposed
on them by the 1969 Civil Liability Convention, such relief being subject to
conditions designed to ensure compliance with safety at sea and other
conventions.
To give effect to the related purposes set out in the Convention.
Under the first of its purposes, the Fund is under an obligation to pay compensation to
States and persons who suffer pollution damage, if such persons are unable to obtain
compensation from the owner of the ship from which the oil escaped or if the
compensation due from such owner is not sufficient to cover the damage suffered.
Under the Fund Convention, victims of oil pollution damage may be compensated
beyond the level of the ship owner's liability. However, the Fund's obligations are also
limited to an amount set by the Fund Convention (the limits were raised under the 1992
Protocol).
Where, however, there is no ship owner liable or the ship owner liable is unable to meet
his liability, the Fund will be required to pay the whole amount of compensation due.
Under certain circumstances, the Fund's maximum liability may be increased.
With the exception of a few cases, the Fund is obliged to pay compensation to the victims
of oil pollution damage who are unable to obtain adequate or any compensation from the
ship owner or his guarantor under the 1969 Convention.
and the 1992 Fund) are in operation, since there are some States, which have not yet
acceded to the 1992 Protocol, which is intended to completely replace the 1971 regimes.
IMO and the IOPC Fund Secretariat are actively encouraging Governments who have not
already done so to accede to the 1992 Protocols and to denounce the 1969 and 1971
regimes. Member States who remain in the 1971 Fund will face financial disadvantages,
since the financial burden is spread over fewer contributors. For both the 1971 and 1992
Funds, annual contributions are levied on the basis of anticipated payments of
compensation and estimated administrative expenses during the forthcoming year.
Application of Protocol
The supplementary fund will apply to damage in the territory, including the territorial
sea, of a Contracting State and in the exclusive economic zone of a Contracting State.
The HNS Convention is based on the two-tier system established under the CLC and
Fund Conventions. However, it goes further in that it covers not only pollution damage
but also the risks of fire and explosion, including loss of life or personal injury as well as
loss of or damage to property.
HNS are defined by reference to lists of substances included in various IMO Conventions
and Codes. These include oils; other liquid substances defined as noxious or dangerous;
liquefied gases; liquid substances with a flashpoint not exceeding 60C; dangerous,
hazardous and harmful materials and substances carried in packaged form; and solid bulk
materials defined as possessing chemical hazards. The Convention also covers residues
left by the previous carriage of HNS, other than those carried in packaged form.
The Convention defines damage as including loss of life or personal injury; loss of or
damage to property outside the ship; loss or damage by contamination of the
environment; the costs of preventative measures and further loss or damage caused by
them.
The Convention introduces strict liability for the ship owner and a system of compulsory
insurance and insurance certificates.
Limits of liability
For ships not exceeding 2,000 units of gross tonnage, the limit is set at 10 million SDR
(about US$14.43 million). For ships above that tonnage, an additional 1,500 SDR (US$
2164.5) is added for each unit of tonnage from 2001 to 50,000; and 360 SDR (US$
519.5) for each unit of tonnage in excess of 50,000 units of tonnage. The total possible
amount the ship owner is liable for is limited to 100 million SDR (US$144.3 million).
States which are Parties to the Convention can decide not to apply it to ships of 200 gross
tonnage and below, which carry HNS only in packaged form and are engaged on voyages
between ports in the same State. Two neighbouring States can further agree to apply
similar conditions to ships operating between ports in the two countries.
In order to ensure that ship owners engaged in the transport of HNS are able to meet their
liabilities, the Convention makes insurance compulsory for them. A certificate of
insurance must be carried on board and a copy kept by the authorities that keep record of
the ship's registry.
HNS Fund
It has generally been agreed that it would not be possible to provide sufficient cover by
the ship owner liability alone for the damage that could be caused in connection with the
carriage of HNS cargo. This liability, which creates a first tier of the convention, is
therefore supplemented by the second tier, the HNS Fund, financed by cargo interests.
The Fund will become involved:
Because no liability for the damage arises for the ship owner. This could occur,
for example, if the ship owner was not informed that a shipment contained HNS
or if the accident resulted from an act of war
Because the owner is financially incapable of meeting the obligations under this
Convention in full and any financial security that may be provided does not cover
or is insufficient to satisfy the claims for compensation for damage
Because the damage exceeds the owner's liability limits established in the
Convention
Contributions to the second tier will be levied on persons in the Contracting Parties who
receive a certain minimum quantity of HNS cargo during a calendar year. The tier will
consist of one general account and three separate accounts for oil, liquefied natural gas
(LNG) and liquefied petroleum gas (LPG). The system with separate accounts has been
seen as a way to avoid cross-subsidization between different HNS substances.
As with the CLC and Fund Conventions, when an incident occurs where compensation is
payable under the HNS Convention, compensation would first be sought from the ship
owner, up to the maximum limit of 100 million SDR (US$144.3 million).
Once this limit is reached, compensation would be paid from the second tier, the HNS
Fund, up to a maximum of 250 million SDR (US$ 361 million) (including compensation
paid under the first tier).
The Fund will have an Assembly consisting of all States, which are Parties and a
Secretariat headed by a Director. The Assembly will normally meet once a year.
A few questions that will help you understand the basics of the compensation
mechanism.
GENERAL
Q: What do the Funds do?
A: The International Oil Pollution Compensation Funds (IOPC Funds) are part of an
international regime of liability and compensation for oil pollution damage caused by oil
spills from tankers. Under the regime the owner of a tanker is liable to pay compensation
up to a certain limit for oil pollution damage following an escape of oil from his ship. If
that amount does not cover all the admissible claims, further compensation is available
from the 1992 Fund if the damage occurs in a State, which is a Member of that Fund.
Additional compensation may also be available from the Supplementary Fund if the State
is a Member of that Fund as well.
The IOPC Funds (1971 Fund and 1992 Fund) help compensate those who have suffered
financial loss as a result of an oil spill from a tanker.
Compensation for pollution damage caused by spills from oil tankers is governed by an
international regime elaborated under the auspices of the International Maritime
Organization (IMO). The framework for the regime was originally the 1969 International
Convention on Civil Liability for Oil Pollution Damage (1969 Civil Liability
Convention) and the 1971 International Convention on the Establishment of an
International Fund for Compensation for Oil Pollution Damage (1971 Fund Convention).
This 'old' regime was amended in 1992 by two Protocols, and the amended Conventions
are known as the 1992 Civil Liability Convention and the 1992 Fund Convention.
There are at present three IOPC Funds: the 1971 Fund, the 1992 Fund and the
Supplementary Fund. These three intergovernmental organisations have different
maximum amounts of compensation and have different Member States.
Q: What was the main difference between the 1971 and 1992 Funds?
A: The main difference is that the amount of compensation available from the 1992 Fund
is much higher than from the 1971 Fund.
Q: Where are the Funds' offices?
A: The joint Secretariat of the 1992 and 1971 Funds is based in London.
Q: Are there offices elsewhere in the world?
A: Occasionally a local claims handling office is opened near to where a major oil spill
has occurred so claims can be processed more easily. The local P & I Club plays a major
role in setting up a local office.
Q: What is the relationship between the IOPC Funds and IMO?
A: The 1971 Fund and 1992 Fund are completely independent from the IMO. Although
the Funds were established under Conventions adopted within IMO, they are independent
legal entities.
MEMBERSHIP
Q: How does a State become a Member of the 1992 Fund?
A: A State must become party to the 1992 Civil Liability Convention and to the 1992
Fund Convention by depositing a formal instrument of accession with the SecretaryGeneral of the IMO. These Conventions should be incorporated into the national law of
the State concerned.
Q: How long does it take to become a Member of the 1992 Fund?
A: A State will become a Member of the 1992 Fund twelve months after the instrument
of accession to the 1992 Fund Convention is deposited with IMO.
Q: What are the advantages of joining the 1992 Fund?
A: If a pollution incident occurs involving an oil tanker, compensation of approximately
US$298 million is available to governments or other authorities who have incurred costs
for clean-up operations or measures to prevent or minimise pollution damage and to
private bodies or individuals who have suffered damage within a 1992 Fund Member
State as a result of the pollution. The flag of the tanker and the ownership of the oil do
not affect the right to compensation.
FINANCE
Q: How are the IOPC Funds financed?
A: The 1971 and 1992 Funds levy contributions from entities in Member States, which
receive more than 150 000 tonnes of crude or heavy fuel oil ('contributing oil') in a year
after sea transport. Governments provide the Secretariat with reports of oil quantities
received, but invoices are sent directly to each contributor.
Q: Does that mean that States do not pay?
A: Normally, States do not pay any contributions. However a State can choose to pay the
contributions instead of the individual receivers if it wishes, but only a few States have
chosen to do this.
Q: Do oil exporters pay contributions?
A: No. In order to create a system, which would not be too complicated to operate, it was
decided to count oil quantities for contribution purposes only when they were received at
a port after sea transport.
Q: Does a company that receives oil temporarily in a storage facility for others have
to pay?
A: Yes. It is the first physical receiver of the oil in a Member State who is liable to pay
contributions, provided that the oil has previously been transported by sea. It does not
matter whether the oil is received on behalf of another company.
Q: If nobody in a Member State receives oil, what happens?
A: If there are no entities in a State that receive more than 150 000 tonnes of contributing
oil in a year, the State will have financial protection for oil spills at no cost at all. A case
in point is the Gulf countries as they are mainly oil exporting countries so; they do not
pay a penny but have coverage for oil pollution damage!
Q: How much does it cost to be a Member of the 1992 Fund?
A: This is another question that is impossible to answer! The level of contributions varies
each year, depending on the amounts of compensation, which the 1992 Fund has to pay.
That depends on the incidents, which occur, and the amounts to be paid in compensation.
Q: How are contributions calculated?
A: The Fund Secretariat estimates the amount required for the following year for
compensation payments and administrative costs. The Assembly takes the decision on the
total amount required. This amount is divided by the total quantity of contributing oil
received in the Member States. This gives an amount per tonne of oil received. The
quantity of oil received by each contributor is multiplied by the amount per tonne to get
the amount in pounds sterling, which has to be paid by that contributor.
Extended compliance procedures and technical assistance provisions have been included,
while a so-called transitional period allows new Contracting Parties to phase in
compliance with the Protocol over a period of five years, provided certain conditions are
met.
The Protocol includes strong precautionary language in the general obligations and urges
parties to consider the polluter pays principle. It also calls for waste prevention audits to
assess alternatives to sea dumping.
The protocol supersedes the London Convention for those countries that have agreed to
become contracting parties. In effect, the 1996 Protocol when in force will replace the
1972 London Convention. The 1996 Protocol is a separate agreement that modernized
and updated the London Convention, following a detailed review that began in 1993.
States can be a Party to either the London Convention 1972, or the 1996 Protocol, or
both.
Background
Dumping at sea of waste generated on land and loaded on board specialized dumping
vessels had been carried out for several years by industrialized countries before
international rules to prevent marine pollution from this practice entered into force.
Implementation of the London Convention 1972 and of the 1996 Protocol thereto is very
much connected with finding solutions for land-based sources of marine pollution and
proper waste management in general. Nowadays, when a regulatory authority is
confronted with a waste problem, seeking an overall net benefit involving all
environmental compartments is preferred over a sectoral approach. With regard to an
industrial activity, the industry concerned will benefit from this approach in many cases
through reduced use of raw materials leading to lower costs, or even through the
marketing of the technologies or processes it developed to solve an environmental
problem.
Purpose and Objectives of the Convention and the Protocol
What are the Purpose and the Objectives of the London Convention 1972?
The objective of the London Convention 1972 is to promote the effective control of all
sources of marine pollution. Contracting Parties shall take effective measures to prevent
pollution of the marine environment caused by dumping at.
The purpose of the London Convention 1972 is to control all sources of marine pollution
and prevent pollution of the sea through regulation of dumping into the sea of waste
materials. A so-called "black- and grey-list" approach is applied for wastes, which can be
considered for disposal at sea according to the hazard they present to the environment.
For the blacklist items dumping is prohibited. Dumping of the grey-listed materials
requires a special permit from a designated national authority under strict control and
provided certain conditions are met. All other materials or substances can be dumped
after a general permit has been issued.
What are the Purpose and the Objectives of the 1996 Protocol?
The objective of the 1996 Protocol is to protect the marine environment from all sources
of pollution. Contracting Parties shall take effective measures to prevent, reduce and
where practicable eliminate marine pollution caused by dumping or incineration at sea.
Upon its entry into force the 1996 Protocol will replace the London Convention 1972.
The purpose of the Protocol is similar to that of the Convention, but the Protocol is more
restrictive: application of a "precautionary approach" is included as a general obligation;
a "reverse list" approach is adopted, which implies that all dumping is prohibited unless
explicitly permitted; incineration of wastes at sea is prohibited; export of wastes for the
purpose of dumping or incineration at sea is prohibited.
What are the potential benefits of becoming a Contracting Party to the London
Convention?
These benefits may include:
Can a country receive technical assistance from the London Convention, even if its not a
Contracting Party?
Yes, whilst all countries are encouraged to join the London Convention, technical advice
might be available to countries, which are not Party to the Convention upon their request.
Assistance through other Parties to the Convention could be made at the discretion of
their national authorities.
Can the cargo at sea be disposed in case of heavy weather and other emergencies?
In certain emergencies, disposal of cargo at sea might be necessary to save lives or the
vessel. The London Convention 1972 (under Article V) and its 1996 Protocol (under
Article 8) allow such practices. However, sea disposal might not always be a safe option.
It is the responsibility of the Master of a Ship to be aware of its cargo including its
hazards, e.g. reactivity with seawater, prior to loading it aboard a vessel.
National Authorities, on receiving an emergency call, should ascertain the material and
its hazards prior to advising sea disposal of cargo. When disposal at sea is allowed by
National Authorities in these situations the Office of the London Convention should be
informed as soon as possible.
These minimum standards apply globally. Where States have adopted regional
agreements to enhance the protection of a particular regional sea, more strict standards,
including prohibitions, may apply (North-East Atlantic, Baltic).
What is the relation between the London Convention and the Law of the Sea Convention?
The UN Convention on the Law of the Sea, 1982 (UNCLOS) gives a framework for the
determination of the rights and obligations of States relating to the oceans. Part XII
contains provisions with regard to protection and preservation of the marine environment.
Implementing the London Convention means also implementation of article 210 of
UNCLOS. Through article 210 States parties to UNCLOS are legally bound to adopt
laws and regulations and take other measures to prevent, reduce and control pollution by
dumping, which must be no less effective than the global rules and standards. The
London Convention, and after its entry into force, the London Protocol give these global
rules and standards. States parties to UNCLOS, which are not yet party to the London
Convention, could by acceding to the Protocol, give better effect to this basic obligation.
What is the relation between the London Convention and the MARPOL Convention?
The MARPOL Convention covers all the technical aspects of pollution from ships,
except (1) the dumping of wastes by ships and (2) pollution arising from exploration and
exploitation of seabed mineral resources. Careful attention has been given to distinct
between the operational discharges by vessels (MARPOL) and dumping of wastes from
vessels (London Convention). The prohibition of all incineration at sea under the London
Protocol, does not affect the incineration on board vessels of garbage which is allowed
under Annex V of MARPOL, provided all conditions of that Annex are met.
Preparedness,
Response
and
Background
In July 1989, a conference of leading industrial nations in Paris called upon IMO to
develop further measures to prevent pollution from ships. The IMO Assembly endorsed
this call in November of the same year and work began on a draft convention aimed at
providing a global framework for international co-operation in combating major incidents
or threats of marine pollution.
Under the Convention, ships are required to report incidents of pollution to coastal
authorities and the convention details the actions that are then to be taken. The
convention calls for the establishment of stockpiles of oil spill combating equipment, the
holding of oil spill combating exercises and the development of detailed plans for dealing
with pollution incidents.
Parties to the convention are required to provide assistance to others in the event of a
pollution emergency and provision is made for the reimbursement of any assistance
provided. The Convention provides for IMO to play an important co-ordinating role.
The OPRC Convention provides an international framework for cooperation in
combating and responding to major incidents or threats of oil pollution. The Convention
strives:
The Parties to the OPRC Convention are required to establish measures for dealing with
pollution incidents, either nationally or at a regional and global level, in cooperation with
other countries. The convention calls for the establishment of stockpiles of oil spill
combating equipment, for the conduct of oil spill combating exercise, and for the
development of detailed plans for dealing with pollution incidents. Parties must require
that ships, offshore units, and seaports under their jurisdiction have oil pollution
emergency plans. Such plans are required for:
Oil tankers of 150 gross tons and above, and other ships of 400 gross tons and
above
Any fixed or floating offshore installation or structure engaged in gas or oil
exploration, exploitation, production activities, or loading or unloading oil (the
operators of offshore units could have arrangements similar to oil pollution
emergency plans, however, these must be coordinated with national systems for
responding promptly and effectively to oil pollution incidents)
Any seaport and oil handling facility that presents a risk of an oil pollution
incident
Parties to the convention are required to provide assistance to others in the event
of a pollution emergency and a special Annex to the Convention provides for the
reimbursement of any such provided
Ships are further required to report incidents of pollution to coastal authorities
Under the Convention's reporting procedure on oil pollution incidents, all persons having
charge shall be required to report such incidents to the competent national authority,
which must assess the incident and inform other states and/or the International Maritime
Organization (IMO). Parties are called to establish national and, as far as possible,
regional systems for preparedness and response. They shall cooperate in pollution
response, research, and technical matters. Beyond the general obligations to cooperate in
research and technical assistance, no provision for disclosure of data is made, nor are any
evaluation criteria or time-scales given. Parties are required to ensure that current
information is provided to IMO response and preparedness systems as well as to evaluate
the effectiveness of the Convention together with the IMO.
The IMO has been designated to facilitate co-operation among the Parties in technical
and educational matters. The OPRC does not provide for a Permanent Secretariat, for a
regular meeting of the Parties, or for any program activity. The IMO Marine
Environment Protection Committee (MEPC) is responsible for coordinating and
administering all OPRC-related activities. The IMO also acts as a clearinghouse for the
information submitted to it by the Parties. The MEPC has established an OPRC Working
Group that is open to representatives from all IMO members, UN organizations, and
intergovernmental organizations in consultative status with IMO. The Working Group
reports to the MEPC and meets in conjunction with MEPC meetings.
Response Systems
The Convention encourages the establishment of national and regional systems for
responding pollution incidents. These systems should include features such as a national
contingency plan, the pre-positioning of oil spill combating equipments, and exercises in
dealing with spills.
International Cooperation
This is a key feature of the Convention. Parties to the Convention agree to cooperate and
provide advisory services, technical support and equipment at the request of other Parties.
The financing of the costs involved is dealt with in an Annex to the Convention.
Role of IMO
IMO itself is designated to perform a number of functions. These include the provision of