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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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Monday, 09 November 15
INDIAN THERMAL COAL IMPORTS SURGED 18%; COKING COAL 6.31% DURING APRIL-OCTOBER: BUSINESS-STANDARD
Indian thermal coal imports surged 18% at the country's top 12 major ports to 55.90 million tonnes (MT) in the first seven months of the curren ...
Sunday, 08 November 15
THE FREIGHT MARKET KEEP DROPPING THIS WEEK - VISTAAR
COALspot.com: The freight market keep dropping this week.
The BDI down 12.48 percent week on week and closed at 631 points on 6 November 2015. ...
Sunday, 08 November 15
CAPESIZE FREIGHT RATES IN AUSTRALIA-CHINA ROUTES OVER 50% CHEAPER THAN BRAZIL-CHINA ROUTE - NIKOS ROUSSANOGLOU, HELLENIC SHIPPING NEWS
China’s mining and steel industries are facing tectonic shifts over the past couple of years, with the country’s limiting of coal use, ...
Friday, 06 November 15
COAL PRODUCTION IN THE U.S. FELL SHARPLY FOR THE WEEK ENDING OCTOBER 31
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 16.6 million shor ...
Thursday, 05 November 15
Q2'16 INDO THERMAL COAL SWAP CONTRACT FOB INDONESIA FALLS TO $39.90/T
COALspot.com: Indonesian coal swap for delivery Q4 2015 declined month on month and week over week. Price of coal seen no improvements this past we ...
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Showing 2726 to 2730 news of total 6871 |
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- Karaikal Port Pvt Ltd - India
- Tamil Nadu electricity Board
- Global Coal Blending Company Limited - Australia
- Rio Tinto Coal - Australia
- Economic Council, Georgia
- Kapuas Tunggal Persada - Indonesia
- Electricity Generating Authority of Thailand
- Siam City Cement - Thailand
- Sakthi Sugars Limited - India
- Sree Jayajothi Cements Limited - India
- Riau Bara Harum - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Central Java Power - Indonesia
- GVK Power & Infra Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Goldman Sachs - Singapore
- Global Green Power PLC Corporation, Philippines
- Manunggal Multi Energi - Indonesia
- Orica Australia Pty. Ltd.
- Indian Energy Exchange, India
- Malabar Cements Ltd - India
- Kobexindo Tractors - Indoneisa
- Mercator Lines Limited - India
- Cement Manufacturers Association - India
- Gujarat Electricity Regulatory Commission - India
- Bharathi Cement Corporation - India
- Jorong Barutama Greston.PT - Indonesia
- GMR Energy Limited - India
- Edison Trading Spa - Italy
- Eastern Energy - Thailand
- The State Trading Corporation of India Ltd
- LBH Netherlands Bv - Netherlands
- Trasteel International SA, Italy
- Gujarat Mineral Development Corp Ltd - India
- Meralco Power Generation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Mjunction Services Limited - India
- ASAPP Information Group - India
- Miang Besar Coal Terminal - Indonesia
- Bukit Baiduri Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Directorate Of Revenue Intelligence - India
- Tata Chemicals Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- ICICI Bank Limited - India
- CNBM International Corporation - China
- Globalindo Alam Lestari - Indonesia
- Posco Energy - South Korea
- Madhucon Powers Ltd - India
- White Energy Company Limited
- Carbofer General Trading SA - India
- VISA Power Limited - India
- Wilmar Investment Holdings
- Leighton Contractors Pty Ltd - Australia
- SMG Consultants - Indonesia
- Antam Resourcindo - Indonesia
- GAC Shipping (India) Pvt Ltd
- Agrawal Coal Company - India
- Interocean Group of Companies - India
- Attock Cement Pakistan Limited
- Iligan Light & Power Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meenaskhi Energy Private Limited - India
- Samtan Co., Ltd - South Korea
- Australian Commodity Traders Exchange
- Latin American Coal - Colombia
- Bangladesh Power Developement Board
- Thai Mozambique Logistica
- PNOC Exploration Corporation - Philippines
- Semirara Mining Corp, Philippines
- Bhoruka Overseas - Indonesia
- Savvy Resources Ltd - HongKong
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Makarim & Taira - Indonesia
- Kaltim Prima Coal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Baramulti Group, Indonesia
- Sinarmas Energy and Mining - Indonesia
- Formosa Plastics Group - Taiwan
- Jaiprakash Power Ventures ltd
- Kumho Petrochemical, South Korea
- Coalindo Energy - Indonesia
- Vedanta Resources Plc - India
- Dalmia Cement Bharat India
- Rashtriya Ispat Nigam Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sical Logistics Limited - India
- Renaissance Capital - South Africa
- Neyveli Lignite Corporation Ltd, - India
- AsiaOL BioFuels Corp., Philippines
- Directorate General of MIneral and Coal - Indonesia
- Commonwealth Bank - Australia
- Orica Mining Services - Indonesia
- Romanian Commodities Exchange
- MS Steel International - UAE
- Altura Mining Limited, Indonesia
- IHS Mccloskey Coal Group - USA
- Parry Sugars Refinery, India
- Semirara Mining and Power Corporation, Philippines
- Electricity Authority, New Zealand
- Star Paper Mills Limited - India
- Ambuja Cements Ltd - India
- Pendopo Energi Batubara - Indonesia
- Indika Energy - Indonesia
- Australian Coal Association
- Videocon Industries ltd - India
- Merrill Lynch Commodities Europe
- Uttam Galva Steels Limited - India
- Central Electricity Authority - India
- Petron Corporation, Philippines
- Standard Chartered Bank - UAE
- Holcim Trading Pte Ltd - Singapore
- Marubeni Corporation - India
- International Coal Ventures Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Therma Luzon, Inc, Philippines
- Cigading International Bulk Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Krishnapatnam Port Company Ltd. - India
- Timah Investasi Mineral - Indoneisa
- Parliament of New Zealand
- Jindal Steel & Power Ltd - India
- Anglo American - United Kingdom
- Aboitiz Power Corporation - Philippines
- McConnell Dowell - Australia
- San Jose City I Power Corp, Philippines
- SMC Global Power, Philippines
- TeaM Sual Corporation - Philippines
- Minerals Council of Australia
- Heidelberg Cement - Germany
- Kalimantan Lumbung Energi - Indonesia
- Deloitte Consulting - India
- Banpu Public Company Limited - Thailand
- Ind-Barath Power Infra Limited - India
- Mintek Dendrill Indonesia
- Toyota Tsusho Corporation, Japan
- Sindya Power Generating Company Private Ltd
- Lanco Infratech Ltd - India
- Aditya Birla Group - India
- Africa Commodities Group - South Africa
- IEA Clean Coal Centre - UK
- Indonesian Coal Mining Association
- South Luzon Thermal Energy Corporation
- Sojitz Corporation - Japan
- Grasim Industreis Ltd - India
- Essar Steel Hazira Ltd - India
- New Zealand Coal & Carbon
- Ministry of Mines - Canada
- Xindia Steels Limited - India
- SN Aboitiz Power Inc, Philippines
- Metalloyd Limited - United Kingdom
- Bukit Makmur.PT - Indonesia
- Kepco SPC Power Corporation, Philippines
- Borneo Indobara - Indonesia
- Billiton Holdings Pty Ltd - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Bahari Cakrawala Sebuku - Indonesia
- Bayan Resources Tbk. - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Chamber of Mines of South Africa
- India Bulls Power Limited - India
- Price Waterhouse Coopers - Russia
- Gujarat Sidhee Cement - India
- Mercuria Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- OPG Power Generation Pvt Ltd - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vizag Seaport Private Limited - India
- Singapore Mercantile Exchange
- Coal and Oil Company - UAE
- Bulk Trading Sa - Switzerland
- Wood Mackenzie - Singapore
- Indogreen Group - Indonesia
- Siam City Cement PLC, Thailand
- Energy Link Ltd, New Zealand
- Global Business Power Corporation, Philippines
- Independent Power Producers Association of India
- Kartika Selabumi Mining - Indonesia
- Indo Tambangraya Megah - Indonesia
- Larsen & Toubro Limited - India
- Eastern Coal Council - USA
- Georgia Ports Authority, United States
- Pipit Mutiara Jaya. PT, Indonesia
- Intertek Mineral Services - Indonesia
- Binh Thuan Hamico - Vietnam
- PTC India Limited - India
- Ministry of Finance - Indonesia
- The University of Queensland
- Kideco Jaya Agung - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Ministry of Transport, Egypt
- CIMB Investment Bank - Malaysia
- Indian Oil Corporation Limited
- Straits Asia Resources Limited - Singapore
- The Treasury - Australian Government
- Medco Energi Mining Internasional
- Simpson Spence & Young - Indonesia
- Oldendorff Carriers - Singapore
- Power Finance Corporation Ltd., India
- Bhushan Steel Limited - India
- London Commodity Brokers - England
- Maheswari Brothers Coal Limited - India
- Planning Commission, India
- Barasentosa Lestari - Indonesia
- Chettinad Cement Corporation Ltd - India
- PowerSource Philippines DevCo
- Salva Resources Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Bhatia International Limited - India
- Energy Development Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Port Waratah Coal Services - Australia
- Karbindo Abesyapradhi - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Thiess Contractors Indonesia
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