We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Friday, 07 July 17
SHOULD WE BE AVOIDING GENERAL AVERAGE? - ALEX KEMP
 KNOWLEDGE TO ELEVATE
Calls for general average to be abolished are nearly as old as the regime itself. A representative of Lloyd’s attended the eponymous Antwerp Conference in 1873 and latterly described general average as a “a nest of fraud and abuses, a lurking place for speculation and waste”. Even in 1913 commentators were complaining about the increasing size of vessels and the volume of bills of lading they created. The Chairman of the US Association of Average Adjusters said of general average that year “the time, trouble, expense and delay are out of all proportion to the benefit achieved”. These comments are surprisingly familiar and it is interesting to see that the same weakness in general average are made today.
Unsurprisingly those involved in transporting or insuring cargo have little love for the regime, when they are usually the paying party. There have been calls in the past for the loss to simply lie where it falls for the respective hull and cargo insurers to absorb. A key piece of research by Mr Matthew Marshall of the Institute of London Underwriters for the IUMI Tokyo conference in 1994 (updated to 1999) really energized the modern debate. His work highlighted the fact that 10% of the cost of general average was adjusters’ fees and another 10% commission (something that has now been abolished in the most recent rules). Perhaps most importantly it was suggested that the majority of general average events were the fault of the ship owner. This helped lead to the ill-fated York-Antwerp Rules 2004 which have now been replaced.
Whilst the York-Antwerp Rules 2004 may now have been replaced with a more moderate regime, the circumstances which give rise to criticism of general average are more relevant than ever. Many commentators have written about the increasing size of container ships, the increasing complexity of their contracts of carriage and the severe impact this has on the cost and time required to adjust such a general average event. This observations were again aired in the negotiations to the York-Antwerp Rules 2016.
For the time being, at least, general average does not seem to be in any grave threat of abolition and the status quo (broadly speaking) will continue. However, that doesn’t mean to say that the market is not evolving and adapting to meet the reality of modern general average. General average absorption clauses have long been a feature of H&M policies as a way to avoid low value general average events. Their limits have increased as vessel size and casualty complexity has increased. We have seen examples of such limits being as much as US$1 million.
However, more recently parties involved in container shipping have taken even more aggressive steps. Vessel sharing agreements and slot charters used in the management of container ships often now contain provisions which compel the parties to “consult” to determine whether they can absorb all the general average sacrifices and losses and to try and persuade the Owners not to declare general average. Often these agreements go further and compel the parties to absorb general average between the parties up to a limit of say US$0.5 million (this should be distinguished from a general average adsorption clause in a H&M policy). This shows a commercial decision in container shipping that general average, in principle, should be avoided as it is not in the interests of shippers, who are the customers of container lines.
It is easy to see why. With adjuster’s fees, through no fault of their own, to collect security often running into the hundreds of thousands of dollars and adjustments taking anything up to a decade, it is an unattractive way to deal with losses arising from a casualty in complex container casualties. As a result we have seen container lines go further than the provisions in their contractual agreements in the aftermath of a casualty and enter into bespoke agreements resolving to fund all general average expenses and sacrifice on certain terms. More often than not this prevents any need to collect general average security or obtain cargo documentation for the entire manifest. This simply leaves the carriers to deal with cargo claims (be them sacrifice or otherwise) in the usual way. One might say that this places a greater financial burden on the carriers who are absorbing cargo’s proportion of general average from their bottom line (such a voluntary liability would not ordinarily be insured by the carrier) as ordinarily, cargo’s proportion of general average would be reimbursed by cargo insurers. This may simply be the effect of what is undoubtedly an extremely competitive market place for container shipping, notwithstanding recent mergers.
Ultimately, whether parties should be considering more aggressive steps to avoid general average following an incident, will depend upon the nature of the casualty, the scale of expenses/sacrifice, the legal regimes involved and the number parties. Clearly, the benefits of modifying the “usual” general average process will be greatest in a container casualty scenario but that’s not say that it should not be considered when other types of vessel are involved.
By: Alex Kemp, Senior Associate at Solicitors Holman Fenwick Willan LLP and Associate of the Association of Average Adjusters
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Monday, 31 July 17
KOMIPO INVITES BIDS FOR 750K MT OF 5,700 KCAL/KG NAR COAL
COALspot.com: South Korea state-owned utility Korea Midland Power (KOMIPO) issued a new tender for 750,000 Metric Tons of Bituminous coal for its B ...
Monday, 31 July 17
THE PORT OF NEWCASTLE SHIPPED 17.08 PERCENT LESS COAL IN JUNE 2017 COMPARED TO ITS MAY LOADING
COALspot.com: The Port of Newcastle, Australia’s major trading ports, and the world’s largest coal export port has shipped $AU 1,442.8 ...
Monday, 31 July 17
THE FREIGHT MARKET DECLINE THIS PAST WEEK
COALspot.com: The Freight market decline this past week compared to the previous week, as BDI and Panamax indexes show a negative trend week over w ...
Friday, 28 July 17
U.S. WEEKLY COAL PRODUCTION UP 1.4% WEEK OVER WEEK - EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totaled an estimated 15.5 million short tonn ...
Thursday, 27 July 17
CAMPBELL SHIPPING APPOINTS ISS FOR GLOBAL HUSBANDRY REPRESENTATION SERVICES CONTRACT - ISS
COALspot.com: Inchcape Shipping Services (ISS) is delighted to announce that it has secured a global husbandry representation contract with Campbel ...
|
|
|
Showing 1991 to 1995 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Holcim Trading Pte Ltd - Singapore
- Kartika Selabumi Mining - Indonesia
- Indika Energy - Indonesia
- Parry Sugars Refinery, India
- Intertek Mineral Services - Indonesia
- India Bulls Power Limited - India
- Binh Thuan Hamico - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- Medco Energi Mining Internasional
- ASAPP Information Group - India
- MS Steel International - UAE
- Indogreen Group - Indonesia
- Coal and Oil Company - UAE
- Eastern Energy - Thailand
- Minerals Council of Australia
- TeaM Sual Corporation - Philippines
- Bangladesh Power Developement Board
- GN Power Mariveles Coal Plant, Philippines
- Vedanta Resources Plc - India
- Kideco Jaya Agung - Indonesia
- Kobexindo Tractors - Indoneisa
- PNOC Exploration Corporation - Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Thiess Contractors Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Billiton Holdings Pty Ltd - Australia
- Port Waratah Coal Services - Australia
- Meralco Power Generation, Philippines
- Kumho Petrochemical, South Korea
- Barasentosa Lestari - Indonesia
- Heidelberg Cement - Germany
- Offshore Bulk Terminal Pte Ltd, Singapore
- Bhushan Steel Limited - India
- Bharathi Cement Corporation - India
- Romanian Commodities Exchange
- Antam Resourcindo - Indonesia
- Riau Bara Harum - Indonesia
- SMG Consultants - Indonesia
- PowerSource Philippines DevCo
- San Jose City I Power Corp, Philippines
- Straits Asia Resources Limited - Singapore
- Madhucon Powers Ltd - India
- Siam City Cement - Thailand
- Global Coal Blending Company Limited - Australia
- Uttam Galva Steels Limited - India
- Bhatia International Limited - India
- Agrawal Coal Company - India
- Iligan Light & Power Inc, Philippines
- Planning Commission, India
- Ind-Barath Power Infra Limited - India
- Baramulti Group, Indonesia
- Attock Cement Pakistan Limited
- Bahari Cakrawala Sebuku - Indonesia
- Global Business Power Corporation, Philippines
- VISA Power Limited - India
- Electricity Authority, New Zealand
- Economic Council, Georgia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Jaiprakash Power Ventures ltd
- Krishnapatnam Port Company Ltd. - India
- Xindia Steels Limited - India
- Siam City Cement PLC, Thailand
- Ceylon Electricity Board - Sri Lanka
- PTC India Limited - India
- Sical Logistics Limited - India
- Trasteel International SA, Italy
- SMC Global Power, Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Edison Trading Spa - Italy
- Rio Tinto Coal - Australia
- South Luzon Thermal Energy Corporation
- Deloitte Consulting - India
- Posco Energy - South Korea
- Price Waterhouse Coopers - Russia
- Power Finance Corporation Ltd., India
- Mercuria Energy - Indonesia
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Kepco SPC Power Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Sarangani Energy Corporation, Philippines
- Vizag Seaport Private Limited - India
- Australian Commodity Traders Exchange
- CIMB Investment Bank - Malaysia
- Metalloyd Limited - United Kingdom
- Neyveli Lignite Corporation Ltd, - India
- The University of Queensland
- Larsen & Toubro Limited - India
- Sojitz Corporation - Japan
- Petron Corporation, Philippines
- LBH Netherlands Bv - Netherlands
- Sindya Power Generating Company Private Ltd
- Kohat Cement Company Ltd. - Pakistan
- Salva Resources Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Karaikal Port Pvt Ltd - India
- Indian Energy Exchange, India
- GAC Shipping (India) Pvt Ltd
- Petrochimia International Co. Ltd.- Taiwan
- Grasim Industreis Ltd - India
- IEA Clean Coal Centre - UK
- Tamil Nadu electricity Board
- Carbofer General Trading SA - India
- Rashtriya Ispat Nigam Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Thai Mozambique Logistica
- Central Electricity Authority - India
- Essar Steel Hazira Ltd - India
- Wilmar Investment Holdings
- Timah Investasi Mineral - Indoneisa
- Mjunction Services Limited - India
- Samtan Co., Ltd - South Korea
- Kapuas Tunggal Persada - Indonesia
- Chamber of Mines of South Africa
- Toyota Tsusho Corporation, Japan
- International Coal Ventures Pvt Ltd - India
- McConnell Dowell - Australia
- Bukit Makmur.PT - Indonesia
- Bukit Baiduri Energy - Indonesia
- Altura Mining Limited, Indonesia
- Sakthi Sugars Limited - India
- Ministry of Transport, Egypt
- Bhoruka Overseas - Indonesia
- Energy Development Corp, Philippines
- European Bulk Services B.V. - Netherlands
- Global Green Power PLC Corporation, Philippines
- Cement Manufacturers Association - India
- Standard Chartered Bank - UAE
- Star Paper Mills Limited - India
- Marubeni Corporation - India
- CNBM International Corporation - China
- GMR Energy Limited - India
- Orica Mining Services - Indonesia
- Electricity Generating Authority of Thailand
- Merrill Lynch Commodities Europe
- Bulk Trading Sa - Switzerland
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Pendopo Energi Batubara - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Oldendorff Carriers - Singapore
- AsiaOL BioFuels Corp., Philippines
- PetroVietnam Power Coal Import and Supply Company
- IHS Mccloskey Coal Group - USA
- Karbindo Abesyapradhi - Indoneisa
- Wood Mackenzie - Singapore
- Therma Luzon, Inc, Philippines
- Australian Coal Association
- The State Trading Corporation of India Ltd
- Savvy Resources Ltd - HongKong
- Africa Commodities Group - South Africa
- Ministry of Mines - Canada
- Eastern Coal Council - USA
- Dalmia Cement Bharat India
- Semirara Mining Corp, Philippines
- Mercator Lines Limited - India
- Mintek Dendrill Indonesia
- Tata Chemicals Ltd - India
- Aditya Birla Group - India
- Kalimantan Lumbung Energi - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Malabar Cements Ltd - India
- SN Aboitiz Power Inc, Philippines
- Orica Australia Pty. Ltd.
- Borneo Indobara - Indonesia
- Bayan Resources Tbk. - Indonesia
- Indo Tambangraya Megah - Indonesia
- Jindal Steel & Power Ltd - India
- Parliament of New Zealand
- Simpson Spence & Young - Indonesia
- Energy Link Ltd, New Zealand
- Leighton Contractors Pty Ltd - Australia
- Chettinad Cement Corporation Ltd - India
- Interocean Group of Companies - India
- Renaissance Capital - South Africa
- Gujarat Sidhee Cement - India
- Semirara Mining and Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Georgia Ports Authority, United States
- The Treasury - Australian Government
- Formosa Plastics Group - Taiwan
- Lanco Infratech Ltd - India
- London Commodity Brokers - England
- Aboitiz Power Corporation - Philippines
- Coastal Gujarat Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- GVK Power & Infra Limited - India
- Independent Power Producers Association of India
- New Zealand Coal & Carbon
- Videocon Industries ltd - India
- Singapore Mercantile Exchange
- Gujarat Electricity Regulatory Commission - India
- Ambuja Cements Ltd - India
- Indonesian Coal Mining Association
- Makarim & Taira - Indonesia
- Central Java Power - Indonesia
- Ministry of Finance - Indonesia
- Maheswari Brothers Coal Limited - India
- ICICI Bank Limited - India
- Globalindo Alam Lestari - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Indian Oil Corporation Limited
- Anglo American - United Kingdom
- Manunggal Multi Energi - Indonesia
- Cigading International Bulk Terminal - Indonesia
- White Energy Company Limited
- Latin American Coal - Colombia
- Pipit Mutiara Jaya. PT, Indonesia
- Goldman Sachs - Singapore
- Coalindo Energy - Indonesia
- Commonwealth Bank - Australia
- Miang Besar Coal Terminal - Indonesia
|
| |
| |
|
