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Each day TFO Canada publishes a sample of trade news on the Canadian import market along with any new, updated or changed regulations and legislations regarding international trade; countries in which TFO Canada offers services and on the export sectors which it promotes.

 

Lawyer Says Ebola Threat to Shipping ĎConsiderableí

Friday, October 17, 2014 > 12:01:25
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(TradeWinds)

The impact of the Ebola outbreak on shipping continues to grow as more ports around the world take precautionary action against ships that have visited West Africa.

TradeWinds reported how some vessels are now asking for a premium to call at some high-risk ports in the region. This week, the UK said it would monitor Automatic Identification System (AIS) data to identify vessels calling at countries affected by Ebola. That follows a move by Singapore to impose an automatic quarantine on ships if they have visited an affected area within the last 60 days.

Malta has already refused entry to the 32,000-dwt Western Copenhagen (built 2013) because of concerns that one of the crew had contracted the disease.

Further delays are expected to result from Ebola screening of stowaways by ports.

Nick Shaw, a partner at law firm Reed Smith, says the impact on shipping will be “considerable”.

“As the number of Ebola cases continues to climb, it may lead to more offshore loading in so far as this is possible. Costs will be increased by the rigorous procedures which are required to manage the outbreak and reduce the spread of the virus, such as the provision of protective gear for the crew and time lost due to the implementation of quarantine measures and mandatory deviations,” he said.

Although crew have even been prohibited from disembarking at the most exposed ports, Shaw says there are still significant commercial risks for companies trading to the region.

“There are still contagion hazards associated with poor port security and stowaways. Delays and deviations may ensue as a result of risk-averse ports refusing entry or imposing strict quarantine measures on a vessel. The allocation of legal and financial risks associated with such deviations and delays is not always certain without specific clauses,” he pointed out.

One major issue will be the payment of hire for quarantined vessels. Shaw says that in the case of a time charter it is not clear cut.

“It depends whether the situation constitutes an ‘off-hire event’ or an exception to the payment of hire under the charter,” he said.

It is different, however, for voyage charters, he explains.

“The key question is whether laytime will commence if a vessel has been placed under quarantine. Whilst traditionally the vessel would not be considered ‘ready’ where loading and discharge is prevented due to quarantine measures, some standard charters differentiate between orders to proceed to quarantined ports, where quarantine is declared before the voyage is commenced and those where the quarantine is not declared until the vessel is on passage to such a port.”

There are also uncertainties surrounding common charter-party terms like “safe port” and “fever/and or epidemic”.

“The mere fact that Ebola cases have been reported at a particular port does not necessarily mean that the port will be considered ‘unsafe’ or in the grip of an “epidemic,” he said.

Owners may also find themselves hit by third-party claims from cargo owners for deterioration of goods. While Ebola specific clauses are being included in high-risk voyage and time charters, that too can involve complications Shaw points out.

“One difficult issue when negotiating such a clause is the length of time for which the charterer should remain responsible for subsequent risks associated with calling at an infected port,” Shaw explained.

“Companies with interests in West Africa are advised to check their charters in detail and ensure that they are up to date with the various rules and guidance issued by the relevant port authority.”


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