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Copenhagen-based BIMCO has developed two new clauses for use in charter parties.

The first is a COVID-19 Crew Change Clause for Time Charter Parties which has been formulated in response to the extraordinary circumstances faced by many owners whose crew have had to remain on board during the COVID-19 “lockdown” for periods often extending beyond their contracts of employment.

Although travel restrictions are beginning to ease, there are still restrictions in many countries impacting on crew changes. The new clause is designed to give owners the liberty to deviate for crew changes under tightly defined circumstances. It also provides an option for charterers to contribute to the crew change in recognition of the potentially high cost of making a COVID-19 related crew change.

“Although the cost of crew changes is usually for owners’ account under a charter party, the extraordinary and unusual circumstances created by COVID-19 have left some owners unable to conduct crew changes on the ship’s trade route. With crew now on board for periods extending beyond their contracts of employment, owners need to have the flexibility to deviate to an alternative place if crew changes can’t be done at the places where the ship is ordered by charterers. This clause is designed to help them with that process and to encourage charterers to assist,” said Soren Larsen, Deputy Secretary General, BIMCO.

The clause is available to download from the BIMCO website along with explanatory notes providing a guide to its use and application.

The second new clause covers a much older issue and is intended for when a contractual dispute escalates and one of the parties want to involve arbitrators, it is essential that notices of commencement of proceedings and the appointment of arbitrators are properly served to the right people. The new Law & Arbitration Clause will address these issues with a provision requiring parties to a contract to clearly identify who are authorised to receive arbitration notices and communication.

Notices can be served by email or any other effective means, but the essential part is that appropriate individuals are identified and that their contact details are kept up to date during the contract. Charter parties usually have some “contact” details, but these are generally for operational communication between the parties. However, those same people may not be authorised to receive notices of service of arbitration proceedings and this can cause problems.

“Communication is a key element in the new clause. Who should the notices be sent to and what means can the parties use to convey the message? We are also clarifying the important distinction between notices being served as opposed to just sent,” said Francis Sarre, Chairman of BIMCO’s Documentary Committee.

The new Law & Arbitration Clause will be presented for adoption by the Documentary Committee at its next meeting on 22 September.

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