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Tuesday, 08 December 15
HOW TO MITIGATE LEGAL RISKS WHEN PURCHASING BUNKERS - LESSONS LEARNED FROM THE OW BUNKER COLLAPSE - THE SWEDISH CLUB
 KNOWLEDGE TO ELEVATE
About a year has passed since OW Bunker & Trading A/S filed for bankruptcy. The collapse shows that there are significant risks for shipowners and charterers in using intermediaries for the supply of bunkers. On the one hand the intermediary issues an invoice in capacity as the contractual supplier and should be paid for the bunkers. On the other hand do physical suppliers in some jurisdictions have an independent right to claim the vessel for unpaid bunkers. As a result, there is an inherent risk for competing claims against vessels to the extent the intermediary fails to pass on the payment to the physical supplier.
The collapse of OW Bunker has not only generated disputes involving competing claims against vessel owners by contractual suppliers and physical suppliers, but also charterparty disputes between owners and charterers. The Club’s FD&D lawyers presently handle about 40 cases involving disputes following the collapse of OW Bunkers. The total sum of these disputes is in excess of USD 20 million. The legal issues are complex and case specific. For instance, it has been argued that OW Bunker or their assignees cannot claim payment at all under English law since they never owned the bunkers for which they issued an invoice. This argument was recently dismissed by the English Court of Appeal, see the Club’s Member Alert of 23 October 2015. In addition, a court decision in one country may not apply in another country. Therefore, as of today, no universal solution to the underlying dilemma with competing claims is in sight.
The OW Bunker collapse has generated important lessons for the future. The following steps may be taken by owners and charterers in order to bring contractual clarity in relation to the supply of bunkers, as well as mitigate the risk for competing claims:
Insert BIMCOs non-lien clause in the charterparty, see Special Circular from BIMCO.
Prior to ordering bunkers, the supplier should be provided with the following notice (this is linked to the above non-lien clause):
To: Bunker Sellers (Name, address and contact details)
Take note that we, (Charterers: Name, address and contact details) are today (date) ordering (specification of) bunkers for supply at (port or place) on or about (date) on our account and our credit to MV/MT………… on charter to us and that the bunkers to be supplied to the Vessel are solely for our account as Charterers and that neither the Vessel, the Owners nor the Master is a party to the bunker supply contract and no lien, encumbrance or any rights shall arise on the Vessel.
Yours faithfully
Charterers of MV/MT………
Avoid any reference on the Bunker Delivery Receipt to the physical supplier’s own Terms and Conditions in order to avoid creating a direct contract between the vessel owner and the supplier.
Stamp and sign the Bunker Delivery Receipt with the following wording:
Vessel…………………
This bunker supply is for account of vessel’s time charterers, Messrs………………
I herewith declare that neither owners / bareboat charterers nor the vessel are responsible for payment of this supply and no lien or other claim against the vessel can therefore arise.
Date:
……………………………………………………………
Master / Chief Engineer
Explore possibilities to take out insurance to protect against the risk of charterer (or bunker intermediary) insolvency
As mentioned above, the use of a bunker intermediary will entail an enhanced risk in relation to the supply of bunkers. Members may therefore consider agreeing to only deal with physical bunker suppliers directly and, if so, a provision to that effect should be inserted in any time charterparty.
In the event an intermediary is used the following precautionary steps can be taken:
Endeavour to ensure that the intermediary has an appropriate credit insurance.
Endeavour to agree to pay the intermediary the profit element only by way of paying the physical supplier separately, or by way of making one payment to the intermediary which is split into two; the intermediary receives the profit element as principal and the substantive sum as agent for the physical supplier. At least the first alternative needs to be expressed in the contract with the intermediary.
Endeavour to ensure that the ultimate buyer has the longest credit period in the contractual chain by way of a term in the contract with the intermediary that the intermediary has to first pay their supplier in full for the bunkers before the ultimate buyer is obliged to pay them.
Finally, a word of caution. There is no magic answer which will eliminate all legal risks in relation to the supply of bunkers. All situations differ and there are different parties involved in supply chains. However, the above constitute steps that owners and charterers can take to try to mitigate those risks as much as possible, in appropriate circumstances. It is acknowledged that the steps may be difficult to take in practice.
Source: The Swedish Club | Hellenic Shipping News
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Wednesday, 17 February 16
TAP ON OPPORTUNITIES IN GROWING ELECTRICITY DEMAND AND NEW COAL POWER PROJECT DEVELOPMENTS IN THE PHILIPPINES - IBC
Tap on Opportunities in Growing Electricity Demand and New Coal Power Project Developments in the Philippines
Coal Power Generation 2016
19- ...
Wednesday, 17 February 16
THE OWNERS FACING HISTORICAL LOW DRY BULK RATES; COAL IMPORTS TO CHINA IS STILL POINTING TO A STRONG TREND OF DECLINING CONSUMPTION
The sharp fall in dry bulk rates that has been taking place since the end of last year and has left owners facing historical low rates for a substa ...
Monday, 15 February 16
CALL THE DOCTOR! SHIPPING'S MEDICAL DRAMA UNFOLDS......- CLARKSONS
The recycling market has started 2016 with a bang, with a huge volume of tonnage heading to demolition facilities. Many of the key shipping markets ...
Monday, 15 February 16
CS 42 COAL INDEX ROSE 0.07% WEEK OVER WEEK
COALspot.com: Average 5000 GAR coal index of Indonesian origin decline 0.15 percent week over week to averaging $38.96 per ton on this past Friday, ...
Monday, 15 February 16
BALTIC INDEX MARGINALLY ROSE BY A POINT D-D; CAPESIZE INDEX DOWN 13 POINTS W-W; PANAMAX INDEX UP 29 POINTS W-W
COALspot.com: The freight markets continued to fall this past week.
The BDI, The Baltic Dry Index (BDI) of dry-bulk shipping freights, a measu ...
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Showing 2561 to 2565 news of total 6871 |
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- Malabar Cements Ltd - India
- Bhushan Steel Limited - India
- Cement Manufacturers Association - India
- Savvy Resources Ltd - HongKong
- Latin American Coal - Colombia
- Kaltim Prima Coal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- Formosa Plastics Group - Taiwan
- Directorate Of Revenue Intelligence - India
- Jaiprakash Power Ventures ltd
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Coalindo Energy - Indonesia
- Larsen & Toubro Limited - India
- MS Steel International - UAE
- Straits Asia Resources Limited - Singapore
- Siam City Cement PLC, Thailand
- Ind-Barath Power Infra Limited - India
- Bharathi Cement Corporation - India
- Kartika Selabumi Mining - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- IEA Clean Coal Centre - UK
- PNOC Exploration Corporation - Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Krishnapatnam Port Company Ltd. - India
- Electricity Generating Authority of Thailand
- Sojitz Corporation - Japan
- Global Business Power Corporation, Philippines
- Maheswari Brothers Coal Limited - India
- Dalmia Cement Bharat India
- Interocean Group of Companies - India
- Bhatia International Limited - India
- Aditya Birla Group - India
- Ambuja Cements Ltd - India
- Global Green Power PLC Corporation, Philippines
- Wood Mackenzie - Singapore
- Price Waterhouse Coopers - Russia
- The Treasury - Australian Government
- Sakthi Sugars Limited - India
- PetroVietnam Power Coal Import and Supply Company
- PowerSource Philippines DevCo
- Oldendorff Carriers - Singapore
- Heidelberg Cement - Germany
- Indonesian Coal Mining Association
- Electricity Authority, New Zealand
- Sarangani Energy Corporation, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Therma Luzon, Inc, Philippines
- Eastern Energy - Thailand
- Samtan Co., Ltd - South Korea
- Gujarat Electricity Regulatory Commission - India
- Africa Commodities Group - South Africa
- India Bulls Power Limited - India
- SMC Global Power, Philippines
- Billiton Holdings Pty Ltd - Australia
- Sinarmas Energy and Mining - Indonesia
- Vizag Seaport Private Limited - India
- Salva Resources Pvt Ltd - India
- Xindia Steels Limited - India
- South Luzon Thermal Energy Corporation
- Semirara Mining Corp, Philippines
- International Coal Ventures Pvt Ltd - India
- Pendopo Energi Batubara - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Videocon Industries ltd - India
- Kobexindo Tractors - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Indian Energy Exchange, India
- European Bulk Services B.V. - Netherlands
- Gujarat Mineral Development Corp Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Posco Energy - South Korea
- Banpu Public Company Limited - Thailand
- Indo Tambangraya Megah - Indonesia
- Renaissance Capital - South Africa
- Jorong Barutama Greston.PT - Indonesia
- Bukit Makmur.PT - Indonesia
- Bukit Baiduri Energy - Indonesia
- Kumho Petrochemical, South Korea
- Power Finance Corporation Ltd., India
- TeaM Sual Corporation - Philippines
- Planning Commission, India
- GMR Energy Limited - India
- Orica Australia Pty. Ltd.
- Baramulti Group, Indonesia
- Indogreen Group - Indonesia
- Marubeni Corporation - India
- Attock Cement Pakistan Limited
- Eastern Coal Council - USA
- White Energy Company Limited
- Central Electricity Authority - India
- Coal and Oil Company - UAE
- TNB Fuel Sdn Bhd - Malaysia
- The University of Queensland
- Makarim & Taira - Indonesia
- Australian Coal Association
- Thiess Contractors Indonesia
- Bhoruka Overseas - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Bangladesh Power Developement Board
- Rashtriya Ispat Nigam Limited - India
- Essar Steel Hazira Ltd - India
- Grasim Industreis Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Singapore Mercantile Exchange
- Minerals Council of Australia
- Trasteel International SA, Italy
- SMG Consultants - Indonesia
- Meenaskhi Energy Private Limited - India
- GVK Power & Infra Limited - India
- Binh Thuan Hamico - Vietnam
- Kideco Jaya Agung - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Sical Logistics Limited - India
- McConnell Dowell - Australia
- Energy Link Ltd, New Zealand
- Indika Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Vedanta Resources Plc - India
- Thai Mozambique Logistica
- AsiaOL BioFuels Corp., Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- Petron Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Tamil Nadu electricity Board
- Maharashtra Electricity Regulatory Commission - India
- Globalindo Alam Lestari - Indonesia
- CNBM International Corporation - China
- San Jose City I Power Corp, Philippines
- Central Java Power - Indonesia
- Star Paper Mills Limited - India
- Meralco Power Generation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Georgia Ports Authority, United States
- Rio Tinto Coal - Australia
- Carbofer General Trading SA - India
- Altura Mining Limited, Indonesia
- Iligan Light & Power Inc, Philippines
- Toyota Tsusho Corporation, Japan
- ASAPP Information Group - India
- Bayan Resources Tbk. - Indonesia
- Ministry of Mines - Canada
- Ministry of Finance - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Medco Energi Mining Internasional
- GAC Shipping (India) Pvt Ltd
- ICICI Bank Limited - India
- New Zealand Coal & Carbon
- Port Waratah Coal Services - Australia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sree Jayajothi Cements Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Kepco SPC Power Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- London Commodity Brokers - England
- Romanian Commodities Exchange
- Commonwealth Bank - Australia
- Economic Council, Georgia
- Aboitiz Power Corporation - Philippines
- PTC India Limited - India
- Kapuas Tunggal Persada - Indonesia
- Mercator Lines Limited - India
- Parry Sugars Refinery, India
- Agrawal Coal Company - India
- Kalimantan Lumbung Energi - Indonesia
- Parliament of New Zealand
- Borneo Indobara - Indonesia
- Lanco Infratech Ltd - India
- Intertek Mineral Services - Indonesia
- OPG Power Generation Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Karaikal Port Pvt Ltd - India
- Edison Trading Spa - Italy
- Chettinad Cement Corporation Ltd - India
- Tata Chemicals Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Anglo American - United Kingdom
- Energy Development Corp, Philippines
- Simpson Spence & Young - Indonesia
- Semirara Mining and Power Corporation, Philippines
- VISA Power Limited - India
- Mercuria Energy - Indonesia
- Uttam Galva Steels Limited - India
- Neyveli Lignite Corporation Ltd, - India
- Australian Commodity Traders Exchange
- Indian Oil Corporation Limited
- Ministry of Transport, Egypt
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sindya Power Generating Company Private Ltd
- Miang Besar Coal Terminal - Indonesia
- Mjunction Services Limited - India
- Manunggal Multi Energi - Indonesia
- Antam Resourcindo - Indonesia
- Merrill Lynch Commodities Europe
- Wilmar Investment Holdings
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Independent Power Producers Association of India
- SN Aboitiz Power Inc, Philippines
- Deloitte Consulting - India
- LBH Netherlands Bv - Netherlands
- The State Trading Corporation of India Ltd
- Orica Mining Services - Indonesia
- Jindal Steel & Power Ltd - India
- Coastal Gujarat Power Limited - India
- Riau Bara Harum - Indonesia
- Barasentosa Lestari - Indonesia
- Siam City Cement - Thailand
- Chamber of Mines of South Africa
- Mintek Dendrill Indonesia
- Standard Chartered Bank - UAE
- Alfred C Toepfer International GmbH - Germany
- Bahari Cakrawala Sebuku - Indonesia
- Madhucon Powers Ltd - India
- CIMB Investment Bank - Malaysia
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