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Skuld Issues Guidance on Avoiding Legal Disputes from 2015 ECA Changes
Maritime P&I Club Skuld has warned members that preparations are necessary to avoid disputes which could arise from Emissions Control Area (ECA) rule changes due to come into force next month.
"The new ultra low sulphur fuel regulations under MARPOL Annex VI will require more than ship side preparations, they will also require existing and future charterparties to be reviewed and claused appropriately in order to reduce the risk of disputes between owners and charterers from a number of angles," said a briefing for Skuld members.
Skuld said its members should be clear over trading warranties, vessel readiness to enter ECAs, fuel specifications, delays and fines for ECA rule violations, and route deviations.
Among other considerations, Skuld members were advised to review geographical scope of charter agreements and ensure that at least some tank space is ready for use with ultra low sulfur fuel.
Bunker clauses should also be robust, said Skuld, including provisions covering the sampling and testing of bunkers.
Disputes are likely to arise in a situation where any delays or fines are incurred as a result of non-compliance with new ECA rules, according to the briefing.
"Given the very low margin for error in ensuring fuel is at no more than 0.10% and the relative ease with which the ULSF could be contaminated at some stage, this is an area of concern going forward," said Skuld.
"Shipowners will need to be ready to expect that the enforcing government agency will focus first and foremost on the vessel for enforcement action."
Skuld also said that ship operators may be tempted to take deviations to avoid ECAs, but that this could lead to contractual and insurance disputes unless agreements specifically gave charterers the right to do so.
Skuld recently warned that the switchover between heavy fuel oil and ECA compliant fuels should be handled carefully to avoid loss of propulsion.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 647.00 | 6.00 | 762.00 | 5.50 |
| Rotterdam | 599.00 | 1.00 | 751.00 | 0.50 |
| Houston | 618.00 | 11.50 | 802.50 | 6.50 |
| Fujairah | 642.00 | 5.50 | 883.50 | 5.50 |
| Global 20 Ports Average | 661.50 | 3.50 | 859.00 | 5.00 |
| Global 4 Ports Average | 629.50 | 1.00 | 799.50 | 1.50 |
| Global Average Bunker Price | 719.00 | 3.50 | 915.00 | 7.50 |
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