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After a meeting at Wah Kwong’s offices in Hong Kong, the drafting team has now finalised the first draft Quiet Enjoyment Letter ready for industry consultation.
QEL and QEL (SHORTFORM) are two standard Quiet Enjoyment Letters (QELs) for use in ship financing transactions. The two QELs are intended for bareboat and time charter parties as well as ship leasing structures and complement the suite of BIMCO term sheets for ship financing ( SHIPTERM and SHIPTERM S ) and ship sale and leaseback transactions ( SHIPLEASE ). Copyright in both the QEL and QEL (SHORTFORM) is held by BIMCO.
The sanctions landscape has grown increasingly complex. International sanctions regimes are constantly changing with new restrictions being added and new persons and entities being listed. A violation of sanctions restrictions can have severe consequences and in the worst cases can lead to parties being listed as sanctioned parties. Therefore, carefully worded sanctions clauses in contracts of affreightment are vital for internationally trading companies to help them manage and mitigate their sanctions risk and to enable them to continue to do business while remaining compliant with the various sanctions regimes.
The sanctions landscape has grown increasingly complex since BIMCO published its Sanctions Clause for Time Charter Parties in 2010 and the Designated Entities Clause for Charter Parties in 2013. International sanctions regimes are constantly changing with new restrictions being added and new persons and entities being listed. A violation of sanctions restrictions can have severe consequences and in the worst cases can lead to parties being listed as sanctioned parties. Therefore, carefully worded sanctions clauses in charter parties and other contracts are vital for internationally trading companies to help them manage and mitigate their sanctions risk and to enable them to continue to do business while remaining compliant with the various sanctions regimes. The absence of a standard BIMCO sanctions clause for voyage charter parties has resulted in owners and charterers amending the BIMCO Sanctions Clause for Time Charter Parties or drafting bespoke clauses. BIMCO has therefore developed this sanctions clause for use in voyage charter parties so that there is an industry standard clause. It is intended to provide a balanced allocation of the risks posed by sanctions as between owners and charterers. This clause is intended for use in all trades except for container trades. A separate sanctions clause for the container trades is under development. This clause was published on 19 December 2019. It is a sanctions clause that also covers issues related to designated entities previously found in BIMCO’s Designated Entities Clause for Charter Parties 2013. This new sanctions clause should be used instead of the old Designated Entities Clause.
QEL and QEL (SHORTFORM) are two standard Quiet Enjoyment Letters (QELs) for use in ship financing transactions. The two QELs are intended for bareboat and time charter parties as well as ship leasing structures and complement the suite of BIMCO term sheets for ship financing ( SHIPTERM and SHIPTERM S ) and ship sale and leaseback transactions ( SHIPLEASE ). Copyright in both the QEL and QEL (SHORTFORM) is held by BIMCO.
A newly set-up BIMCO drafting team involving a cross-section of shipowners, charterers, financing and leasing institutions and private practice lawyers from Asia, Europe and the US began work this week to develop a standard letter of quiet enjoyment (LQE) for use in long term charter and leasing structure financings.
BIMCO has published two standard Quiet Enjoyment Letters (QELs), the first standard form QELs available to the industry, to offer a tool that can ensure the charterers’ uninterrupted use of a ship if the owner defaults under the financing facility.
