Bunker Fuel Sulphur Content Clause for Time Charter Parties 2005

Overview

BIMCO Bunker Fuel Sulphur Content Clause for Time Charter Parties 2005 

(a) Without prejudice to anything else contained in this Charter Party, the Charterers shall supply fuels of such specifications and grades to permit the Vessel, at all times, to comply with the maximum sulphur content requirements of any emission control zone when the Vessel is ordered to trade within that zone.

The Charterers also warrant that any bunker suppliers, bunker craft operators and bunker surveyors used by the Charterers to supply such fuels shall comply with Regulations 14 and 18 of MARPOL Annex VI, including the Guidelines in respect of sampling and the provision of bunker delivery notes.

The Charterers shall indemnify, defend and hold harmless the Owners in respect of any loss, liability, delay, fines, costs or expenses arising or resulting from the Charterers' failure to comply with this Sub-clause (a).

(b) Provided always that the Charterers have fulfilled their obligations in respect of the supply of fuels in accordance with Sub-clause (a), the Owners warrant that:

(i) the Vessel shall comply with Regulations 14 and 18 of MARPOL Annex VI and with the requirements of any emission control zone; and
(ii) the Vessel shall be able to consume fuels of the required sulphur content  

when ordered by the Charterers to trade within any such zone.

Subject to having supplied the Vessel with fuels in accordance with Sub-clause (a), the Charterers shall not otherwise be liable for any loss, delay, fines, costs or expenses arising or resulting from the Vessel’s failure to comply with Regulations 14 and 18 of MARPOL Annex VI.

(c) For the purpose of this Clause, "emission control zone" shall mean zones as stipulated in MARPOL Annex VI and/or zones regulated by regional and/or national authorities such as, but not limited to, the EU and the US Environmental Protection Agency.

Explanatory notes

Background

In October 2009 BIMCO initiated a project to develop a suite of standard bunker clauses for use in time charter parties. The rationale behind developing the suite is simply to address the ever increasing importance of bunker issues in time charter parties and the need to ensure that the risk of bunker disputes is minimised by clearly worded clauses that reflect legislative developments. The Suite of Clauses was adopted by BIMCO’s Documentary Committee at its meeting in Vancouver in June 2011.

The Suite provides clauses covering matters relating to delivery/redelivery bunkers; bunkering operations; sampling; fuel testing programmes; and ECA trading, all of which are matters that are frequently absent from or insufficient in many standard time charter parties. Many older time charter forms contain bunker clauses covering the fundamental principles under the charter, but simply do not contemplate today’s situation where vessels are required to carry and use several grades of fuel and where sampling and testing regimes are an integral part of the process.

It is not the intention that BIMCO’s Suite of Bunker Clauses should be a direct replacement for the existing bunker clauses in a time charter - there is, for example, no intention to deal with the actual pricing or quantities of bunkers, as this will already be dealt with. What the Suite offers is a means of supplementing standard time charters with bunker provisions that are missing or poorly worded. Each clause within the Suite is designed to be self-standing and independent of the other clauses in the Suite. As always, users should be careful when incorporating any additional clauses so that the new clauses do not conflict with existing provisions.

The current suite of standard bunker clauses for use in time charter parties consists of:

Explanatory notes

The following explanatory notes provide some background to the thinking behind the bunker fuel sulphur content clause for time charter parties clause.

This Clause is the BIMCO Bunker Fuel Sulphur Content Clause published in 2005. The Clause is known to function well in practice and so it has been incorporated into the Suite without any amendment.

The Clause takes stock of the obligations of owners, time charterers and their bunker suppliers under the MARPOL regime in respect of fuel sulphur content of fuels. The basic premise is that the charterers must provide the vessel with fuels of the necessary sulphur content to allow the vessel to trade within the emission control zones ordered by the charterers. The charterers are also required to use bunker suppliers that operate in accordance with Regulations 14 and 18 of MARPOL Annex VI. The Clause gives emphasis to the provision of bunker delivery notes and sampling procedures.

The owners’ obligations under the Clause are subject to the charterers having fulfilled their obligation to provide fuel in accordance with the Clause. The responsibility for the storage, management and use of the fuels supplied rests with the owners as does the emission control requirements of Regulations 14 and 18.

The owners warrant that the vessel will comply with the emission control regulations of the places she is ordered to trade by the charterers and that the vessel is capable of consuming the fuels provided.

Originally published in BIMCO Special Circular No. 4, 4 November 2011 (Updated 25 June 2014) - BIMCO Suite of Bunker Clauses for Time Charter Parties

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