Vessel Chartering, Vessel Charters, Voyage Charter.

VesselChartering usually falls into three categories, each distinguished bythe degree of operational control over the vessel which the chartererexercises. There are three basic types ofvessel charters: voyage charter, time charter and bareboat charter. In each case, the contract between the shipper (or charterer) and theship-owner is called the "charter party." When anorganization ships goods on a vessel operated by a common carrier,the open cargo policy may be the only ocean marine policy theorganization needs. In a voyage charter, the vessel is chartered fora one-way voyage (or a series of consecutive voyages) betweenspecified ports at a negotiated freight rate. The charterer agrees tohave the cargo available for loading at the place and time agreed,and the ship-owner agrees to have the vessel available for loading atthe same place and time. Abareboat charter (or demise charter) is very different from a voyageor time charter. Under a bareboat charter, the ship-owner deliversthe vessel to the charterer for a specified period of time withoutcrew, stores, insurance or any other provisions. The charterer isthen responsible for navigating, crewing, and insuring the vessel asif it were owned by the charterer. Bareboat chartering is much lesscommon in commercial shipping than are voyage and time chartering.Because bareboat charterers actually operate the chartered vessel,they usually purchase a full-fledged protection and indemnity (P&I)policy to cover their liabilities arising out of operating thevessel, just as they would if they owned it. A vessel charterer faces many of the same exposures to liability as theVessel Owner does, as well as specific obligations to the Owner. Incertain jurisdictions even the pollution liability and fines falls onthe charterer. Also are the liabilities to the cargo and to anythingcaused due to negligence. The charterer can face enormous liabilitiesand risk of financial loss even when he is only tangentially involvedin the event which gave rise to the claim. The charterer also has along list of obligations and exposures to the Vessel Owner. Charterers Liability insurance can provide protection to thecharterer in much the same way Protection and Indemnity insuranceshields the Vessel Owner from potentially catastrophic loss. Mostnew building programs were completed by taking delivery from awell-established Korean yard, all of which we immediately charteredout at fixed rates for periods that range between 7 and 10 years.These charters have been agreed on a bareboat basis, which not onlyreduces the long-term market risk relating to the vessels, but alsoeliminates any operational risk for that period. These vessels wereproduct tankers and their daily cost, taking into account lease hirepayments and operating expenses, was significantly higher than themarket rates that have been prevailing in the product tanker segment. Todaythere are millions of people employed with jobs varying fromprocessing frozen barracuda, squid and mackerel which are thepredominant species caught by charter vessels. Companies pay taxes onthe profits it earns from charter vessels, as does any other companythat uses charter vessels to catch quota. The many suppliers thatservice charter vessels also pay taxes. Foreign crew are employedmuch like seasonal workers on orchards and chartering vessels makesit affordable to fish for low-value species because companies don’thave the big capital outlay on a vessel that would be tied up forpart of the year. If charter vessels were banned there would be aloss in tax revenue not a gain.

Was this helpful? 0 0 Comments

You're reading Vessel Chartering, Vessel Charters, Voyage Charter..