BIMCO CHARTER PARTIES - malingroup.com - Malin Abram
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BIMCO CHARTER PARTIES
Nick Banks – Contracts Engineer
Chris Cairns – Tendering Manager INNOVATING HEAVY
LIFT SOLUTIONS
malingroup.com
CONTENTS OF PRESENTATION • Introduction to Malin • Quality, Safety, Health and the Environment • What is BIMCO? • Contract Formation • Types of Charter Party • BIMCO Contract Forms
Insert Name, Job Title
THE MALIN GROUP
We are committed to providing a reputable and reliable service to all of our clients
worldwide...
DESIGNED, BUILT &
COMMISSIONED IN SCOTLAND
OUR BUSINESS UNITS
• Our CLIENTS
OUR clients
We serve a range of clients
across a number of sectors:
• Marine
• JobOffshore
Insert Name, Title & subsea
• Energy
• Oil & gas
• Infrastructure
• Process manufacturing
DESIGNED, BUILT &
COMMISSIONED IN SCOTLAND
• Our clients
MALIN ABRAM
• Formed in 1899, Malin Abram Ltd specialise in
heavy lift project cargo shipping and handling.
This includes full turnkey projects where all
trailer hire, craneage, shipping, engineering, Insert Name, Job Title
temporary steelwork fabrication chartering and
operational planning and oversight is managed
and executed by one in-house team.
• Our specialist skills are also harnessed to deliver
other heavy lift services such as third party
warranty approvals and operational oversight as
well as design and fabrication of custom
mechanical handling jigs, cradles and equipment
DESIGNED, BUILT &
COMMISSIONED IN SCOTLAND
QUALITY, SAFETY, HEALTH AND THE ENVIRONMENT
• Malin Abram pride ourselves in always putting the health, safety, and well
being of our staff above everything that we do.
• As users of the marine environment, first and foremost, we similarly take our
obligation to this natural resource equally seriously all of which our SHE
statistics attest.
CONTRACT FORMATION
• If you are moving cargo by sea, then
you would typically use a form of BIMCO
Charter Party
• Charter Party
• A maritime contract between a shipowner
and charterer for the hire of a vessel and
delivery of cargo
• Parties involved
• Owner
• Charterer
• Shipbroker (sometimes)
• Vessel can be sub-chartered
• If sub-chartered, typically back-to-back
• Our clients
WHAT IS BIMCO?
• Baltic and International Maritime Council, founded in 1905.
• Circa. 1,900 member companies across 120 countries (ship-
Insert Name, Job Title
owners, operators, managers, brokers and agents)
• Now the world’s largest international shipping association
with the aim to produce standard contract forms
• Maintain relevant and updated shipping contracts - balance
the competing interests of the owner and charterer.
Regularly updated to remove any ambiguity in previous
revisions.
• Use of BIMCO SMARTCON online to create and amend charter
parties as required.
DESIGNED, BUILT &
COMMISSIONED IN SCOTLAND
TYPES OF CHARTER PARTY
• Bareboat Charter Parties
• Hire of a “bare” vessel only, whereby no administration or technical maintenance is included as part of the
agreement (e.g. BIMCO BARGEHIRE 2008);
• Charterer obtains possession and full control of the vessel along with the legal and financial responsibility for it;
• Charterer pays for all operating expenses, including fuel, crew, port expenses and P&I and hull insurance.
• Voyage Charter Parties
• Hiring of a vessel and crew for a specific “voyage” between a loadInsert Name, Job Title
port and a discharge port;
• Charterer pays vessel owner on a per-ton or lump sum basis. Payment for the use of the vessel is known as
“freight”;
• Owner pays the port costs, fuel cost and crew costs for vessel i.e included in the Lump Sum;
• Specifies a period, known as a laytime, for loading and unloading the cargo - if laytime is exceeded, the charterer
must pay demurrage at a pre-agreed rate.
• Common examples of this type of CP are BIMCO “GENCON” for general purpose cargo vessels, or “TOWCON” for
towing vessels
• Time Charter Parties
• In contrast to voyage charters, time charters are not defined by load and discharge ports, but rather a specific period
of time;
• Owner is responsible for and manages all aspects of the vessels technical management and operation, but the
charterer selects the ports and directs the vessel where to go;
• Charterer pays a daily hire to owner;
• Charterer to pay for all fuel consumed, port charges and commissions.
• Common variants of this particular type of charterparty that we see and use include BIMCO’s "TOWHIRE",
for towing vessels, and "SUPPLYTIME", for offshore vessels. DESIGNED, BUILT &
COMMISSIONED IN SCOTLANDBIMCO CONTRACT TERMS
• GENCON 1994 • BARGEHIRE 2008
• SUPPLYTIME 2017 • HEAVYCON 2007
• TOWCON 2008 • And many more…
• TOWHIRE 2008
• Note – above are latest revisions of each form. It is still possible to use
previous forms, so it is important to review the differences in each.
• With an increasing focus on force majeure due to the COVID-19 outbreak,
BIMCO has gathered a drafting team to develop a free-standing force majeure
clause for use in a variety of contracts. These contracts will supersede the
versions listed above, when available from BIMCO.BIMCO FORM STRUCTURE
• BIMCO Charter Parties are divided in to two
main sections:
• Part I
• Box layout used to insert specific contract
information:
• Name of the parties, basic ship details,
scope of work and rates, etc
• Part II
• Terms and Conditions
• Annex A
• Vessel SpecificationGENCON 1994
• Voyage charter party i.e for a specific
“voyage” between a load port and a
discharge port Job Title
Insert Name,
• A general purpose agreement for the
services of a vessel in exchange for
freight, and can be used in a variety of
trades
• Example – transportation of 3 off
loaded reels from Le Trait to Nigg
DESIGNED, BUILT &
COMMISSIONED IN SCOTLANDGENCON 1994: KEY CONSIDERATIONS
• Cargo:
• Type and quantity of the cargo to be loaded and whether “full and complete” or “part” cargo. Last in first
out.
• Important for this to be accurate – freight can be calculated on per Te basis or volume basis, therefore can
have an impact later down the line.
• Cargo Handling Gear
• Free use of vessel’s equipment as on board is typically provided.
• Vessel’s securing equipment (lashings, chains) may not be certified, therefore crucial to obtain inventory and
any certification available. Often, Malin Abram tend to supply brand new to avoid any hiccups down the line.
• Loading / Discharging
• It is important to distinguish which party is responsible for loading, stowing, securing at load port and
unsecuring at the discharge port – cost and liability implications if not clear in the Charter Party.• Laytime
• Time allowed for loading and discharging cargo;
• Can be separate times for loading and discharging or a total laytime;
• When does time start? Important!!! Berth availability is also a consideration – laytime will
start if berth not available upon vessel’s arrival.
• Example – 12hrs freetime each port for loading/discharging - Demurrage £7,500 per day
pro rata
• Cancelling Date:
• Sets out the cancelling date which means if the vessel is not ready to load on the agreed
date the charterers may cancel the charterparty.
• Liability and Indemnity Provisions
• Owners Responsibility Clause – Owners are responsible for loss of or damage to the goods
in the case the loss, damage, or delay has been caused by negligence on part of the
Owner.
• Loading / discharging as noted above – Charterer’s liability.
• Stevedore damage – Charterers are responsible for Stevedore damage to the VesselInsert Name, Job Title
GENCON 1994: COMPLETED EXAMPLES
DESIGNED, BUILT &
COMMISSIONED IN SCOTLANDSUPPLYTIME
SUPPLYTIME
20172017
• Developed in 1975 to meet the demand for specialist support vessels to serve a
rapidly growing offshore oil and gas exploration and production industry
• Time charter party - vessel supplied for a defined time period
• Freight rate – daily hire rate
• Owner responsible for all aspects of the vessels technical management and
operation
• Charterer responsible for its commercial operation
• Provides for limited cargo space, deck space for operating, cranes and other
services
• Contract allows charterer to make modifications to vessel
• Knock for knock liability regimeSkandi Africa, DOF owned vessel, on time charter to TFMC
Skandi Acergy, DOF owned vessel, on time charter to Subsea
7
Rever Sapphire, Diving Support Vessel
Olympic Ares, Construction Support VesselSUPPLYTIME 2017: KEY CONSIDERATIONS
• Delivery and Redelivery
• Vessel delivered on a fixed date at named port or place
• Charterers to redeliver vessel at named port or place. Vessel to be free of
cargo and with cargo tanks clean
• Condition of Vessel
• Vessel to be as described and in class as specified in Annex A
• Owner to keep vessel in such class and in every way fit for the service
• Employment and Area of Operation
• Vessel restricted in the work it can perform and where it can perform the
workSUPPLYTIME 2017: KEY CONSIDERATIONS
• Structural Alterations and Additional Equipment
• Requires consent of the Owners
• Vessel to be redelivered reinstated and all additional equipment removed,
fair wear and tear excepted
• Period of Hire
• From the time that vessel is delivered to the charterers until the expiration or
earlier termination of charter party
• Off-Hire
• If vessel prevented from working, due to Owner’s fault, no hire is payable in
respect of any time lost
• Owners have 24 hours on hire per month maintenance, survey, repair and
dry-docking. Can be used to offset off-hire time
• Charterer can terminate charter party if allowed off-hire periods exceededTOWCON 2008 • Ocean towage charter party on a lump sum basis • Agreement for a tug to tow vessel/object from a place of departure to a place of destination • Aimed at commercial towage sector • Risk of time and delay on tugowner • Knock for knock liability regime
TOWHIRE 2008 • Ocean towage charter party on a daily hire basis. • Freight rate – daily hire rate. • Towage services to be provided for a fixed period of time. • No delay or demurrage provisions. • Knock for knock liability regime.
VESSELS CHARTERED WITH TOWCON/TOWHIRE
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Queen Elizabeth Aircraft Carrier
Alliance – tugs chartered on a
Towcon basis for QEC Block Moves
DESIGNED, BUILT &
COMMISSIONED IN SCOTLANDTOWCON 2008 / TOWHIRE 2008 – KEY CONSIDERATIONS
• Payment
• Can be split into instalments (Towcon)
• All sums earned at the moment due
• Certified Bollard Pull
• Measure of the pulling power of tug; must be sufficient to pull tow
• Additional Charges and Extra Costs
• For hirer account: port expenses, pilotage, harbour dues, taxes, assisting tugs, costs for
preparation of tow and cost of insurance of tow
• Towing Gear
• Tugowner provides free of cost
• Hirer to pay for replacement if towing gear is lost or damaged; an exception to knock for
knock liabilityTOWCON 2008 / TOWHIRE 2008 – KEY CONSIDERATIONS
• Free Time (only Towcon)
• Time allowed for connecting and disconnecting of the tow
• Separate times at place of departure and place of destination
• Commences when arriving at pilot station and ends when dropping last pilot when leaving for
open sea
• Delay Payments to apply if free time exceeded. Charged until tug and tow sails from place of
departure or the tug is free to leave the place of destination
• Bunkers (Fuel)
• Lump sum price based on current cost of bunkers
• Adjustment to price if actual cost of bunkers is higher or lower
• Tow-worthiness
• Obligation on hirer to ensure that tow is fit to be towed; includes cargo on tow
• No obligation to perform the tow until tugowner is satisfied that it is fit and ready
• Cancelling
• Hirer has option of cancelling the agreement if the tug is not ready to commence towageBARGEHIRE 2008 • A bareboat charter party • Specifically designed for unmanned, non-self-propelled seagoing barges • It is a lease agreement whereby the charterer obtains possession and full control of the barge along with the legal and financial responsibility for it • Often chartered with owner’s insurances made available to charterer • Charterers to provide suitable tug or tugs • Freight Rate – daily hire rate • Knock for knock liability regime
BARGEHIRE 2008
Insert Name, Job Title
• Dina Launcher barge chartered on Bargehire 2008 for OPV contracts for BAE
Systems
• Stemat 92 barge chartered for transportation of Jacket Extension Piece
DESIGNED, BUILT &
COMMISSIONED IN SCOTLANDBARGEHIRE 2008: KEY CONSIDERATIONS
• Charter Party Period
• Fixed period of hire
• Charter Hire
• Charterer to pay owner day rate from date of delivery
• Hire to continue to until barge redelivered to Owner
• Insurance
• Owners or Charterers to insure
• Surveys
• Marine Surveyor appointed to report on condition of barge together with its equipment,
machinery and spares at time of delivery and redelivery
• Cost of on-hire and off-hire surveys shared equally between owner and chartererBARGEHIRE 2008: KEY CONSIDERATIONS
• Maintenance and Operation
• Barge in full custody and at absolute disposal of the charterers
• Charterers must use tugs that are of suitable size and capability for the proposed tow
• Charterers responsible for having necessary repairs down to the barge
• Delivery / Redelivery
• Once charterers accept the barge unable to make a claim against the owners on account
of the condition of the barge
• Barge shall be redelivered to the owners in the same or as good structure, state, condition
as barge was deliveredHEAVYCON 2007 • Standard heavylift charter party – classified as a Voyage Charter Party • The developments within the heavylift sector, which initiated drafting of HEAVYCON, has since continued at great speed with more types of cargoes and vessels tailor made for the various cargoes coming on to the market • It is a knock-for-knock contract designed primarily for use by semi- submersible vessels in the super-heavy lift (float-on/float-off) market where cargoes are almost always loaded on deck and are usually sole cargoes
HEAVYCON 2007 • Also used by the midsized (lift-on / lift-off and roll-on / roll-off) sector, however less suited – HEAVYLIFTVOY typically used, whereby there are multiple shipments both above and below deck. Key difference in the application of each contract is the liability provisions • Freight Rate – Lump sum voyage fee, with mobilisation and redelivery fees • Demurrage rates typically higher than GENCON given increase to size and capability of vessel
FLOAT ON/FLOAT OFF
LIFT-ON / LIFT-OFF
ROLL ON/ROLL OFFHEAVYCON 2007: KEY CONSIDERATIONS
• Cargo:
• Type and quantity of the cargo to be loaded and whether “full and
complete” or “part” cargo.
• Important for this to be accurate – freight can be calculated on per Te basis
or volume basis, therefore can have an impact later down the line. Cargo
can be refused if the volume and/or weight is different than that specified.
• Additionally, with reference to cargo handling gear, particularly important
if the project plan is to use the vessel’s cranes to load / discharge the
cargo
• Impact on liability provisions – HEAVYCON vs HEAVYLIFTVOY• Loading and Discharging
• Clause 4 provides the parties with optional methods of loading and discharging. It
is therefore important that the parties agree on which loading and discharging
method shall apply.
• Commencement of Loading / Cancelling Date
• The first layday and the cancelling date shall be stipulated in the Charter Party;
• The vessel shall be ready for loading at any time between the first layday and the
cancelling date, subject to a notification mechanism (narrowing window);
• The parties decide and agree between them the number of days after the first
layday after which the Charter Party can be cancelled.
• Interpellation provision
• Free time / Demurrage
• The term “free time” is used for the time allowed for loading and discharging
operations (differs from other contracts where it is referred to as “laytime” – just
to confuse you!
• Important to note the freetime included within the Lump Sum, and if this is
enough for the project – can easily incur demurrages when the project overruns.SUMMARY • Insight in to Malin Abram, and the BIMCO contracts used by industry • Who are BIMCO and why we use them • Types of charter party and specific contract forms - important to consider the type of contract required: • Time charter, voyage charter, bareboat • Gencon, Supplytime, Towhire, Towcon, Bargehire, Heavycon… and more!
THANK YOU!
Nick Banks – Contracts Engineer
Chris Cairns – Tendering Manager INNOVATING HEAVY
LIFT SOLUTIONS
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