Failure to check charterparty wording catches ship manager off guard

International Transport Intermediaries Club (ITIC) has urged ship brokers and managers to check the terms of their charterparty agreements closely before signing, in order to avoid costly mistakes further down the line.

By way of illustration, ITIC cites the case of the manager of a tanker entering West African waters who believed that the terms of a charterparty provided that armed guards were to be appointed at the charterer’s expense. The manager duly appointed the guards for the voyage at a cost of $170,000, but the charterer refused to pay the invoice.

The terms of the charterparty did in fact include provisions relating to the appointment of armed guards, but their deployment was not mandatory. In addition, the charterparty provided that the charterer was only liable for up to $20,000 of any such costs. The charterer offered to pay that $20,000, and the owner demanded that the managers pay the shortfall.

The owner pointed out that it had sent the manager voyage orders stating that the decision to appoint armed guards was one for the owner to make. It had in fact only appointed armed guards for one out of the last ten calls to the area and on
that occasion the charterparty required the charterer to pay the security bill in full.

ITIC says it has seen a number of claims caused by ship brokers and managers acting on their recollection of a charterparty wording, as opposed to checking what the charterparty actually says. On this occasion, ITIC reimbursed the full claim of $150,000.

ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com


For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
charlotte.kirk@thomasmiller.com

BDO says UK Chancellor’s Spring Statement contains no unwelcome surprises for shipping

Leading accountant and shipping adviser BDO says that, while the Spring Statement by the UK Chancellor of the Exchequer did not contain any shipping-specific initiatives, it did include some measures which could be of interest to the maritime sector.

Of particular interest to the offshore sector, the government called for evidence to identify what should be done in order to further strengthen the position of Scotland and of the UK in general as a global hub for decommissioning.

Detailed legislation was published in respect of the new capital allowances for structures and buildings which was announced in the UK Budget 2018. This relates to a new 2% capital allowance which will be available in respect of the construction costs (including land alteration and improvement expenditure) of new commercial non-residential structures and buildings. Very broadly, buildings must be used for a commercial purpose. This will apply where the contract is entered into on or after 29 October 2018.

A policy paper was also published on tackling tax evasion, tax avoidance and other forms of non-compliance, with the government reiterating that it will continue to build on the steps already taken. Another policy paper, ‘No Safe Havens’, was meanwhile published reiterating the government’s commitment to ensuring offshore tax compliance and preventing unfair outcomes, using international collaboration and the exchange of information

BDO tax partner Sue Bill says, “Once again, the absence of any shipping-specific measures is good news for the maritime sector, which continues to benefit from a tax regime which provides certainty and stability.”


The BDO Shipping & Transport team has extensive experience delivering accountancy, tax and advisory services to the sector worldwide. BDO delivers key information and insights to the shipping community, including the annual OpCost report, the quarterly Shipping Confidence Survey and a host of thought leadership on topical issues, such as regulatory developments and market conditions. https://www.bdo.co.uk/en-gb/industries/shipping-and-transport

Accountancy and business advisory firm BDO LLP provides integrated advice and solutions to help businesses navigate a changing world.

Our clients are Britain’s economic engine – ambitious, entrepreneurially-spirited and high-growth businesses that fuel the economy.

We share our clients’ ambitions and their entrepreneurial mind-set. We have the right combination of global reach, integrity and expertise to help them succeed.

BDO LLP
BDO LLP operates in 17 locations across the UK, employing nearly 5,000 people offering tax, audit and assurance, and a range of advisory services. BDO LLP has underlying revenues of £590m and is the UK member firm of the BDO international network.

BDO’s global network
The BDO global network provides business advisory services in 162 countries, with 80,000 people working out of 1,600 offices worldwide. It has revenues of $9bn.

Press office:
+44(0)20 7893 3000
media@bdo.co.uk

http://www.bdo.uk.com/news.html
http://twitter.com/BDOaccountant

London P&I Club reports further growth in owned entry

THE London P&I Club saw further growth in its mutual owned entry following the conclusion of the recent P&I renewal season.

The club’s director of underwriting, Reto Toggwiler, says, “Our mutual membership saw year-on-year growth of approximately of 3.5m gt or 7%. This result is evidence of the strong commitment shown to the club by existing members and by the new members that we were pleased to welcome, drawn from a number of different countries around the world.

“Everybody at the club is grateful to members and brokers for their support in achieving an encouraging outcome which underlines the importance that shipowners attach to the London Club’s service-focused and understanding approach to P&I”.


www.londonpandi.com

BDO / Moore Stephens merger strengthens shipping presence

The merger between leading accountants and advisers BDO LLP and Moore Stephens LLP in London was completed earlier this month.

Clients of the merged firm, BDO, will have access to offices in over 160 countries with a presence in every major shipping location in the world.

Michael Simms, Partner and Head, Shipping & Transport at BDO, says: “Both BDO and Moore Stephens LLP have for many years been leading accountants and advisers to the shipping and transport sector. We are confident our clients will now benefit greatly from having access to the combined resources of the two firms.

“The merger enables us to deliver the ever-increasing range and depth of solutions demanded by our clients, who can expect the same high-quality, industry-leading service to which they have become accustomed.”

The BDO Shipping & Transport team has extensive experience delivering accountancy, tax and advisory services to the sector worldwide. BDO delivers key information and insights to the shipping community, including the annual OpCost report, the quarterly Shipping Confidence Survey and a host of thought leadership on topical issues, such as regulatory developments and market conditions. https://www.bdo.co.uk/en-gb/industries/shipping-and-transport


Accountancy and business advisory firm BDO LLP provides integrated advice and solutions to help businesses navigate a changing world.

Our clients are Britain’s economic engine – ambitious, entrepreneurially-spirited and high-growth businesses that fuel the economy.

We share our clients’ ambitions and their entrepreneurial mind-set. We have the right combination of global reach, integrity and expertise to help them succeed.

BDO LLP
BDO LLP operates in 17 locations across the UK, employing nearly 5,000 people offering tax, audit and assurance, and a range of advisory services. BDO LLP has underlying revenues of £590m and is the UK member firm of the BDO international network.

BDO’s global network
The BDO global network provides business advisory services in 162 countries, with 80,000 people working out of 1,600 offices worldwide. It has revenues of $9bn.

Press office:
+44(0)20 7893 3000
media@bdo.co.uk

http://www.bdo.uk.com/news.html
http://twitter.com/BDOaccountant

Moore Stephens says leaner and greener shipping will attract investment in 2019

Leading accountant and shipping adviser Moore Stephens says shipping will continue to attract investors in 2019 if it fulfils its ESG (environmental, social and governance) responsibilities.

In the latest issue of Bottom Line, the Moore Stephens shipping sector newsletter, Richard Greiner, a partner in the firm’s Shipping & Transport team, says, “It has been suggested that the future is very much like the present, only longer. Should that prove to be the case for the shipping industry, it would not be such a bad thing, since the present is not so bad as it has appeared to be at various times over the past ten years.

“Confidence in the shipping industry actually dipped slightly towards the end of last year, but that was against a four-year high recorded in first-half 2018. There remains an appetite for investment in shipping from both new and existing players. That is likely to continue in 2019 so long as shipping lives up to its ESG responsibilities.

“Existing and emerging regulations such as those on ballast water management and greenhouse gas emissions show that shipping is becoming more environmentally aware and accountable. New funds will be needed and the environmental investment story should prove attractive to many potential investors. Green doesn’t come cheap, or easy, however, the more so when viewed in the context of rising interest rates. This year we will see important decisions made on investments to comply with the new environment-driven regulations which are coming into force, and we will have a better idea of whether the drydocking capacity exists to cope with demand.

“Meanwhile, the industry will face other challenges. Operating costs are set to increase, and hopes will persist that freight rates will do likewise. Tonnage imbalances will endure in some trades. The Baltic Dry Index may behave less erratically than in the latter part of last year. Brexit may finally mean Brexit, which could mean a number of things, but should prove positive for shipping in the UK. The introduction of new lease accounting standards will change things for some, though not their actual cashflows. And, last but not least, the effect of geopolitical influences will continue to be felt throughout 2019.

“Despite the prospect of new trade negotiations between China and the US, the world remains a volatile stage on which to trade. There are presidential elections this year in a number of countries, including Argentina, Indonesia, Nigeria and Panama. Additionally there are a plethora of parliamentary elections over the coming year in, among others, Greece, India, North Korea, at least a dozen African nations and perhaps even in the United Kingdom.

“Uncertainty is likely to remain the norm in 2019.”


Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 614 offices of independent member firms in 112 countries, employing 30,168 people and generating revenues in 2017 of $2.9 billion. www.moorestephens.co.uk/shipping-transport

For more information:
Richard Greiner
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
richard.greiner@moorestephens.com

Wikborg Rein appoints new shipping and energy partners in London

LEADING international law firm Wikborg Rein has appointed two new partners and a senior lawyer to its Shipping, Trade, Energy & Infrastructure team in London.

Renaud Barbier-Emery, who joins Wikborg Rein as a partner from Ince & Co, is a specialist in the energy, maritime and international trade sectors on both transactional and contentious matters. His practice focuses on the development and financing of offshore energy projects, most frequently for the publicly listed owners of large fleets of drilling units, FPSOs and LNG vessels.

Renaud also acts for shipowners, shipbuilders, financiers and investors on a range of transactions involving the construction, conversion, repair, sale & purchase, leasing, chartering, management and financing of vessels, as well as advising on joint ventures. In addition, he advises on a wide range of transactional trade finance matters.

Renaud recently participated as part of the Wikborg Rein team which advised Belgian gas carrier operator Exmar on its agreement with Argentina’s YPF for the long-term deployment at Bahia Blanca of the Caribbean FLNG unit, now renamed Tango FLNG, to produce and export LNG from Argentina.

Jonathan Goldfarb, who also joins as a partner from Ince & Co, specialises in energy and trading projects across the oil and gas and renewables sectors. He advises on project tendering, vessel construction and conversion, and financing, sale and purchase and leasing arrangements for FPSOs, FSOs, FSRUs, LNGCs, FLNG, drilling units and drillships.

Jonathan also acts for international traders in relation to structured trade finance transactions and trading projects. He represents some of the world’s largest contractors and energy traders, as well as financing banks, and handles a wide variety of projects in the energy and trading sector. He has been particularly active on Floating Storage and Regasification (FSRU) projects in the LNG sector.

Meanwhile, senior lawyer Ina Lutchmiah has also joined Wikborg Rein from Ince & Co. Ina has particular expertise in LNG projects and other offshore energy transactions, and her experience includes advising on the decommissioning and recycling of offshore assets and long-term charters for FSRU projects.

Chris Grieveson, manager partner of Wikborg Rein’s London office, says, “We are delighted to welcome Renaud, Jonathan and Ina to our team. Their appointments continue Wikborg Rein’s policy of recruiting experienced and respected industry professionals who will strengthen still further the firm’s reputation as a leading specialist in the shipping and energy sectors.”


Wikborg Rein's London office was established in 1987. The office specialises in shipping, energy, construction, international arbitration and all other forms of dispute resolution. In addition, it handles financing, corporate and cross-border transactions. The London office has both English and Norwegian lawyers who all possess broad expertise within Wikborg Rein's specialist areas. The London office is also the hub of the firm’s international English law practice focusing on shipping, energy and construction matters worldwide. www.wr.no

UK tax regime continues to provide stability for shipping and offshore maritime

International accountant and shipping consultant Moore Stephens has outlined a number of unexpected changes introduced by the UK Budget 2018 which could have implications for the shipping and offshore maritime industries. But it stresses that these are relatively minor alterations which will have a limited impact on what continues to be a stable tax regime for the maritime sector.

The Annual Investment Allowance (AIA) will increase from £200,000 to £1m per annum for all qualifying investments in plant and machinery made between 1 January 2019 and 31 December 2020. This means that it will be important to either delay or bring forward any large expenditure on plant and machinery accordingly. However, there will be a reduction in the rate of writing-down allowances for special-rate pool assets from 8% to 6% per annum on a reducing balance basis.

A new 2% capital allowance will be available in respect of the construction costs of new commercial non-residential structures and buildings, including land alteration and improvement costs. Very broadly, the building must be used for a commercial purpose. This will apply where the contract is entered into on or after 29 October 2018.

There will be a restriction on the use of capital losses for companies. From 1 April 2020, the proportion of annual capital gains that can be relieved by brought-forward capital losses will be restricted to 50%. However, companies will have unrestricted use of up to £5m capital or income losses each year, so this rule is likely to be of limited application.

The government will consult on introducing a new targeted relief for the cost of goodwill (the amount paid for a business that exceeds the fair value of its individual assets and liabilities) in the acquisition of a business with eligible intellectual property from April 2019.

New rules apply to off-payroll working in the private sector, where an individual who is effectively an employee is actually employed by a private company. In this case, responsibility for operating the off-payroll working rules will apply to the organisation or other third party engaging the worker. This change will apply from April 2020.

There are no changes to the corporation tax rate, which will fall to 17% in April 2020. But there are some changes to Entrepreneurs’ Relief (ER). For example, from 6 April 2019, the minimum period throughout which the qualifying conditions for relief must be met will be extended from 12 months to 24 months. There are also changes to the definition of ‘personal company’.

The government is to consult on some changes to the principle private residence relief from capital gains tax for owner-occupiers, including a reduction in the final period exemption from 18 months to 9 months. These rules will apply from April 2020.

Moore Stephens tax partner Sue Bill says, “There were no big surprises for the maritime sector in the UK Budget 2018, with the result that the UK tax regime continues to provide certainty and stability for the shipping and offshore maritime sectors.”


Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 614 offices of independent member firms in 112 countries, employing 30,168 people and generating revenues in 2017 of $2.9 billion. www.moorestephens.co.uk/shipping-transport

For more information:
Sue Bill
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
sue.bill@moorestephens.com

Liberia introduces QR codes and other electronic certificate security features

Liberia continues to deploy significant improvements to its state-of-the-art web-based client interface system, WayPoint, by enhancing certificate security features, introducing a QR Code symbol for electronic certificates and streamlining the procedure for document verification.

WayPoint was launched in late-2016 to provide the owners and operators of Liberian-flag ships with secure, real-time, user-friendly access to their fleet details, as well as to facilitate International Convention certification applications. It was upgraded last year to include a number of major improvements designed to help owners and operators to manage their fleet-wide regulatory compliance issues more efficiently.

Beginning 7 August, Liberia will start including QR Codes to enhance the document verification process. This means that Port State Control and other interested parties can quickly scan the QR matrix barcode via their mobile phones, whereafter they will be directed to the verification page. The QR code and the Registry’s tracking identification (TID) number will also be clickable if viewed on a computer and will direct users to the verification page, where a verification copy of the document can be viewed and downloaded. In addition to these public-facing features, a variety of embedded security features are also being deployed to enhance the electronic integrity of Liberia’s electronic certificates.

Scott Bergeron, CEO of the Liberian International Ship & Corporate Registry (LISCR), the US-based manager of the Liberian Registry, says, “Liberia was the first flag state to make widespread use of electronic certificates in 2009. We are very happy to see other flags and recognized organizations follow our lead with their own electronic certifications. As technology evolves, so does the need to ensure that security and verification features are robust enough to meet cyber challenges. With this latest update, Liberia has further strengthened its reputation as the world’s most technologically advanced and sophisticated ship register, taking the pain and expense of document verification away from owners and operators and freeing up their time to concentrate on making their vessels safer and more profitable.”

WayPoint is accessible to clients through https://waypoint.liscr.com. Clients of the registry may apply for user access via the WayPoint homepage.

The Liberian Registry is the world’s most technologically advanced maritime administration. It has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive and innovative service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment. www.liscr.com

Liberia the fastest growing flag in shipping and offshore

Liberia is the fastest growing major open registry in 2018 in both the shipping and offshore sectors, according to leading shipping services provider Clarksons in its Clarksons World Fleet Monitor June 2018.

Alfonso Castillero, CCO of the Liberian International Ship & Corporate Registry (LISCR), the US-based manager of the Liberian Registry, says, “I am delighted to see that Liberia continues to be the leading flag in 2018. It has grown by 2.2 percent in terms of gross tonnage overall so far this year, while Panama showed negative numbers and the Marshall Islands growth of just 1.7 percent.

“The market recognizes that Liberia has improved its services and invested in technology to make the lives of its clients easier without increasing its fees. This is in stark contrast to our competitors, who have put into place steep fee increases and added costs, without significant forms of savings for owners, despite the difficult market conditions.

“Despite high scrapping volumes in recent years, the Liberian Registry has shown significant growth while maintaining a reputation for the highest standards of safety and responsiveness.

“Liberia continues to live up to its commitment to helping shipowners navigate what are – despite certain recent positive improvements - still very difficult market conditions. The Liberian Registry responds quickly to issues involving owners, and in many instances anticipates difficulties before they arise. In this way, it helps keep Liberian-flag ships moving efficiently and safely along global trade routes.”

In the offshore sector, meanwhile, Liberian-flag fleet growth has peaked at 8.2 percent so far in 2018, compared to the figures for Panama (down by 1.8 percent), the Marshall Islands (up by only 2.6 percent), and the Bahamas (up by only 2.0 percent). Alfonso Castillero says, “The first half of 2018 has shown what a strong presence the Liberian flag has in the offshore sector, with an increase in market share three times that of the next major open registry. This is due in no small measure to the strong fundamental understanding by the registry’s staff – many of whom have practical experience of the offshore industry - of the problems facing this fluctuating sector.”


The Liberian Registry has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive and innovative service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment. www.liscr.com

Liberia backs Australia’s push for IMO reform

The Liberian Registry has confirmed its support for an initiative by Australia calling on the International Maritime Organization (IMO) to reconsider transparency and the role of industry bodies in the organisation.

Liberia is the largest flag state to support the push by Australia, which will lead to a submission to the IMO Council meeting in July calling into question the existing role of the IMO Council and the IMO Assembly, and seeking to facilitate greater transparency and the wider representation of maritime interests in the IMO.

The Australian submission suggests that discussions at IMO should be more open to the public and other stakeholders. It also refers to the decreasing accessibility of discussions and decisions within the IMO Council and Assembly for both member states and the public.

Scott Bergeron, CEO of the Liberian Registry, says, “As a founding IMO member and the world’s second-largest flag state, Liberia has always been a committed and public supporter of IMO, and will continue to be so. But it is only right that we should lend our support to Australia’s push for reform in the light of concern from observers both within and outside the organization that the IMO decision-making process may not be fit for purpose in the 21st century and may moreover be susceptible to commercial influence.”


The Liberian Registry has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive and innovative service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment. www.liscr.com

AKD appoints new partner to Transport & Energy team

Leading Benelux law firm AKD has appointed Vivian van der Kuil a partner in its Transport & Energy team with effect from 1 June 2018.

Vivian joined AKD in 2015. She is an international litigation specialist with wide experience as a lawyer of complex proceedings in the Dutch Civil and Criminal Court. She is also a former judge and public prosecutor. Before joining the legal profession, Vivian completed officer training at the Royal Dutch Institute for the Navy and subsequently worked as an officer in the Operations/Navigation Service with the Royal Dutch Navy.

Vivian specialises in emergency response in the shipping and energy sectors, including salvage, total loss, collisions, fire and explosion, limitation of liability, wreck removal, piracy, ship arrest and both civil and criminal pollution liability involving seagoing vessels, inland waterway vessels, and yachts. She acts for charterers, traders, shipowners, hull & machinery underwriters and P&I clubs on charter party, bill of lading, offshore and general maritime issues. Vivian deals with insurance coverage and other shipping and energy-related commercial and contractual disputes. She also advises on public international law including the law of the sea.

Vivian is a Legal 500 first-rate recommended lawyer and a member of the legal committee of IVR, the international association of national organisations representing, among others, the inland navigation, insurance and surveying sectors. She says, “Transport and energy are volatile and complex areas, and I have been able to use - and to add to – my experience of these sectors since joining AKD. I am delighted to have been made a partner and to continue my development as part of an outstanding team.”

Jos van der Meché, head of AKD’s Transport & Energy team, says, “Vivian will be a great asset to our partner team. She has a wealth of experience of different areas of the industry at the highest level, as well as an impressive pedigree as an advocate and judge. She has all the experience and expertise necessary to improve still further the ability to find innovative solutions to complex issues which is the hallmark of the AKD Transport & Energy team.”

AKD’s Transport & Energy team provides a full range of legal services. AKD is a full-service Benelux firm with over 250 lawyers, civil-law notaries and tax advisers.

AKD: Law Firm of the Year: Benelux | The Lawyer European Awards 2018

www.akd.nl

Moore Stephens says UK Autumn Budget preserves stable tax regime for shipping

The stability of tax rules is of vital importance to the UK shipping sector, and international accountant and shipping adviser Moore Stephens says it is therefore encouraging that the UK government continued to provide a stable regime in its Autumn Budget 2017.

The Budget includes some specific further assistance for the offshore sector, with the introduction of a transferrable tax history mechanism for UK oil producers for deals on or after 1 November 2018. This is designed to facilitate the transfer of late-life oil and gas assets. In addition, the government is to launch a technical consultation on allowing a petroleum revenue tax deduction for decommissioning costs incurred by a previous licence holder.

While there are no new developments relating specifically to the shipping industry in the Budget, there are some items worthy of note. Under current rules, where a company realises a capital gain, the original cost will be adjusted for an inflation allowance. This allowance will now be frozen from 1 January 2018. Meanwhile, the Research & Development (R&D) tax credit will be increased from 11% to 12%. R&D is interpreted widely, and this may be of interest, for example, to suppliers to the offshore sector carrying out research and development activities, or companies developing software.

Capital gains made by non-residents on all UK property after April 2019 will be taxable, rather than capital gains on just UK residential property. There will be certain exemptions for investors such as pension funds.

Finally, the government will invest a further £155 million in additional resources and modern technology for HMRC to increase tax revenues by targeting the hidden economy, further tackling those engaged in marketing tax avoidance schemes, and addressing non-compliance among mid-sized businesses and wealthy individuals.

Moore Stephens tax partner Sue Bill says: “Once again it is a case of a UK Budget where little or no specific maritime-related news is good news for the UK shipping sector, while the offshore industry has been given some further, welcome help.”

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 626 offices of independent member firms in 108 countries, employing 27,997 people and generating revenues in 2016 of $2.7 billion. www.moorestephens.co.uk


For more information:
Sue Bill
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
sue.bill@moorestephens.com

Liberia hails BWMC amendments as good for shipping and environment

The Liberian Maritime Administration has welcomed an agreement reached by the IMO Marine Environment Protection Committee (MEPC) on an implementation schedule for the Ballast Water Management Convention (BWMC) which broadly incorporates the terms of an amendment initially proposed by Liberia.

It was decided at the 71st session of the MEPC (MEPC 71) in London that ships built after 8 September 2017 should have a ballast water management system (BWMS) installed upon delivery. Existing ships, however, will have until their first or second MARPOL Annex I IOPPC renewal survey after 8 September 2019 to install a BWMS, depending on when the survey occurs.

What is effectively a two-year deferral on the implementation schedule for existing ships will be incorporated in the BWMC as new Regulation B-3, which sets out the timeframe for when ships should install a BWMS. The wording in Paragraph 10, meanwhile, reflects the desire by IMO member states to limit any further decoupling of the MARPOL Annex I IOPP Certificate from other convention certificates before the 8 September 2019 cut-off date.

Alfonso Castillero, Chief Commercial Officer of the Liberian International Ship &Corporate Registry (LISCR), the US-based manager of the Liberian Registry, says, “We want to thank the industry and all member states for the key role they played in securing this agreement. Liberia was one of the first administrations to ratify the convention, and is entirely committed to its effective and smooth implementation. But the existence of important practical and technical considerations compelled it to seek the support of other stakeholders in securing an equitable implementation date for the BWM Convention.

“Liberia began proposing amendments to the convention at earlier sessions of MEPC, in the belief that the proposed implementation schedule was unworkable within the predicted time-frame and given the availability of BWMS. Following last year’s MEPC70 meeting, where no clear decision was taken on the two sets of draft amendments, Liberia initiated discussions with other interested IMO member states and industry organizations to develop a single unified amendment taking into account parts of both drafts.

“Liberia is delighted that MEPC 71 approved the draft amendments, with a view to eventual adoption at MEPC 72. With just two months before the BWMC enters into force, the decision is timely and will ensure that the necessary pieces are in place for shipping and other stakeholders to effectively and smoothly implement the convention, with consequent positive implications for the protection of the marine environment.”


The Liberian Registry is the world’s most technologically advanced maritime administration. It has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive and innovative service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment. www.liscr.com

ITIC pays out for pool manager’s acceptance of unacceptable tanker

International Transport Intermediaries Club (ITIC) has highlighted the costly consequences of a shipping pool manager’s failure to accurately describe a tanker, leading to a substantial claim by charterers.

The pool manager misdescribed the tanker as being acceptable to a specific oil major, even though he had received an email from the head owner prior to fixing which stated that it had rejected the vessel. This email was overlooked by the pool manager when the tanker was fixed for a spot voyage to load ultra-low-sulphur diesel.

The fixture recap contained a clause stating, “To the best of owner’s knowledge at the time of fixing, vessel is not unacceptable to following oil majors …” The list referred to a number of companies, but did not include the specific oil major.
The pool manager, however, had mentioned during negotiations that the tanker should be acceptable to this specific oil major since it was not excluded.

The charterers could not sell the cargo and had no other option than to put it into
storage. They claimed $250,000 in damages, a claim which was settled by the pool
manager, who was duly reimbursed by ITIC.
ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com



For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com

ITIC and ASG launch new surveyors’ indemnity wording

International Transport Intermediaries Club (ITIC) and the Admiralty Solicitors Group (ASG) have launched a new surveyors’ indemnity wording designed to address the imbalance between owners’ and surveyors’ responsibilities typically encountered under existing indemnity agreements.

Surveyors are invariably asked to sign a waiver and indemnity by the master of a vessel before they are given approval to board. Such documents will frequently stipulate that surveyors must waive all rights to make a claim against the owner and the vessel in respect of any personal injury or loss of or damage to their equipment which they suffer, even if it is caused by the fault of the owner. Conversely, surveyors are also asked to indemnify the owner if any of the vessel’s crew suffer death or personal injury, or if there is any loss or damage to the vessel itself or its equipment. Occasionally, the indemnity will even extend as far as claims made against the owner by third parties.

Mark Brattman, ITIC’s legal director, says, “These waivers and indemnities are usually presented to surveyors as they are climbing aboard the vessel. Surveyors therefore do not have a realistic opportunity to read such documents and invariably just sign them, in order to gain access to the vessel to perform their jobs.

“ITIC has seen many owner-produced wordings over the years, all of them unfavourable to the surveyor. The ASG had a wording which was a significant improvement on the owner-produced documents, but ITIC felt that this could be made more balanced. With the agreement and co-operation of the ASG, a new wording, the ASG/ITIC 10 has been produced.

“Under the ASG/ITIC 10 wording, the owner will have the usual responsibilities of any occupier to any visitors, unless the vessel is considered a casualty, in which event the surveyor will acknowledge that the master cannot guarantee the safety of visitors, and the owners’ liability will be restricted to losses specifically caused - or contributed to - by the negligence, recklessness or wilful misconduct of the owner. Discussions about what constitutes a casualty can take place after the event, thereby allowing the surveyor to avoid the need to negotiate on the steps of the vessel.

“Both ITIC and ASG agree that the new wording represents a far more equitable apportionment of liability when surveyors are asked to attend a vessel, whether by a P&I club on behalf of an owner or by charterers, cargo interests or insurers.”


ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com

The Admiralty Solicitors Group promotes and preserves standards in the practice of maritime law in England. As well as Admiralty Law issues, its interests also embrace dry matters, including the carriage of goods, sale and purchase, insurance and all other aspects of shipping law in which member firms play a prominent part.

For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com

Moore Stephens warns on dangers of diving unprepared into shipping pools

International accountant and shipping adviser Moore Stephens has warned ship owners and operators to check carefully the financial, tax and jurisdictional implications of participating in shipping pool arrangements.

Shipping partner Michael Simms says, “Shipping pools can be an attractive option, particularly in difficult markets and during periods of economic uncertainty. Interest in the concept generally is increasing as a way to leverage money and maximise economies of scale. But while it might make good commercial sense for like-minded shipping interests to pool their resources to mutual advantage, traps may lie in wait for the unwary.”

Shipping pools can take a variety of forms, from incorporated entities or partnerships to joint-ventures and other forms of agreement. The jurisdiction in which the pool is established is of primary importance, since it will have fundamental tax and reporting implications.

Simms notes, “Historically, tax-friendly offshore jurisdictions have been a natural fit for many shipping pools, but the recent increased focus on general tax transparency and on proper governance and reporting procedures may serve as a catalyst for change in this regard. The existing structure of shipping pools established in offshore jurisdictions is unlikely to change, but it would be reasonable to expect the members of any new pool arrangements to at least consider the option of establishing the pool in a more traditional jurisdiction.

“A move towards greater corporatisation of shipping pools, which may grant access to trade finance solutions, might be a viable option for many owners, provided the terms of entry and exit are acceptable.”

Moore Stephens has advised on a number of pool agreements during the past 12 months. There are a range of tax issues to consider when setting up, amending or joining a pool. In the case of a new pool, it will be necessary to consider the tax position of each entity within the pool structure. Other important considerations include the terms of the pool agreement itself, the status of the pool under competition law, the effectiveness of the marketing strategy, and the way pool accounts are prepared and submitted.

Michael Simms concludes, “Shipping pools have clear advantages for some. But it is a challenging market, and one subject to increasingly stringent evaluation. It would be a mistake to just dive in without careful consideration.”

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 626 offices of independent member firms in 108 countries, employing 27,997 people and generating revenues in 2016 of $2.7 billion. www.moorestephens.co.uk


For more information:
Michael Simms
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
michael.simms@moorestephens.com

Moore Stephens says Autumn Statement bodes well for UK business stability

International accountant and shipping adviser Moore Stephens says the Autumn Statement from the UK Chancellor of the Exchequer should provide stability for UK businesses.

Moore Stephens tax partner Sue Bill says, “While there are no new developments relating specifically to the shipping industry, there are a number of items worthy of note. It was confirmed that the corporation tax rate will be 17% from April 2020, and will not be further reduced. Rules will be introduced to limit the tax deduction that large groups can claim for interest expenses from April 2017. These will apply where a group has net interest expenses of more than £2 million, where these expenses exceed 30% of UK taxable earnings, and where the group’s net interest earnings ratio in the UK exceeds that of the worldwide group.”

Corporation tax loss relief rules will also be changed with effect from April 2017, with the result that the amount of profit that can be offset by carried-forward losses will be restricted to 50% after a £5 million allowance. There will be greater flexibility, however, with regard to the types of profit that can be relieved by tax losses brought forward.

For the oil and gas sector, the process to opt a field out of Petroleum Revenue Tax, which is now at a rate of 0%, has been simplified in order to reduce administrative costs.

It has been confirmed, meanwhile, that reforms to the taxation of non-UK domiciled individuals will be brought in from April 2017. Moore Stephens tax partner Gill Smith says, “These rules will end the permanency of the non-domiciled tax status and introduce inheritance tax for UK residential property where it is held indirectly by a non-domiciled individual through an offshore structure. In addition, Business Investment Relief rules will be changed to make it easier for non-domiciled individuals taxed on the remittance basis to bring offshore money into the UK for the purpose of investing in UK businesses.”

Others measures announced in the Autumn Statement include confirmation of reforms to the Substantial Shareholdings Exemption (SSE) rules, the introduction of further incentives to encourage research and development, and a review of the rules relating to the taxation of benefits in kind. The government has also reiterated its commitment to reduce offshore tax evasion and aggressive tax avoidance schemes.

Sue Bill says, “The Autumn Statement appears to place the emphasis on stability for UK business which, given recent events, would seem to be good news, not least for the shipping sector. “

Moore Stephens LLP is noted for a number of industry specialisations and is widely acknowledged as a leading shipping, offshore maritime and transport & logistics adviser. Moore Stephens LLP is a member firm of Moore Stephens International Limited, one of the world's leading accounting and consulting associations, with 657 offices of independent member firms in 106 countries, employing 27,613 people and generating revenues in 2015 of $2.7 billion. www.moorestephens.co.uk

For more information:
Sue Bill
Moore Stephens LLP
Tel: +44 (0)20 7334 9191
sue.bill@moorestephens.com

ITIC warning on the price to be paid for misreading tariffs

International Transport Intermediaries Club (ITIC) says the misreading of tariffs in shipping documentation is a common cause of costly claims.

ITIC cites the case of a South American port agent asked by the owners of a vessel to provide a quote for the costs of discharging a shipment of project cargo. The agent reviewed the port authority’s official tariffs, and advised the owners that the stevedoring costs would be $28.90 per metric tonne of cargo. The cargo weighed 296 metric tonnes, so the owners calculated the stevedoring costs at approximately $8,500 and quoted that in turn to the charterers of the vessel. The voyage was duly fixed on that basis.

After the cargo had been discharged, the stevedores invoiced the agent for the sum of $130,000. When these costs were questioned by the owners, the agent realised that the $28.90 rate it had quoted to the owners was the rate per cubic metre, not per metric tonne. It was apparent that the agent had simply misread the port tariff document. After discussion with the agent, the stevedores agreed to offer a discount on the costs, and the claim, which was covered by ITIC, was ultimately settled for $75,000.

ITIC points out that claims often arise from misread tariffs. In another recent case, ship agents in Australia quoted the incorrect port charges for a local port to their customer. The customer then fixed on that basis and suffered a loss of AU$86,000. The claim against the agent was reimbursed by ITIC.

ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com



For more information:
Charlotte Kirk
ITIC
Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com

ITIC warns that failure to follow lay-up procedure can be costly

International Transport Intermediaries Club (ITIC) has reported a case in which a lay-up manager was held liable for a $250,000 contribution to a claim for extensive damage to a vessel whilst in lay-up.

The lay-up manager, as agent for the owner, arranged for a contractor to fit internal blanks to the sea valves of a vessel going into cold lay-up. Subsequently, the vessel’s main engine flooded after the valve to the main cooling seawater line was accidentally opened, resulting in serious damage to the machinery and electrics.

The damage survey found that the internal blanks had not been fitted properly by the contractor, and the owner claimed against the contractor for about $3m. Amid concern that the contractor would not be able to meet such a claim, the owner turned its attention to the lay-up manager, alleging that good practice dictated that all sea valves were to be fitted with internal blank flanges. It added that external sea suctions should have been closed off by divers using fibreglass blanks fitted with neoprene seals.

The lay-up manager had not arranged for the external suctions to be blanked, and the owner argued that, had the manager arranged for the external blanks to be fitted, there would not have been any flooding. Although the contractor had clearly failed to do its job properly and was primarily liable for the claim, the lay-up manager was required to contribute $250,000 to the overall settlement, which was reimbursed under its ITIC cover.

ITIC says the case also illustrates how the outcome of claims can depend on the way in which a manager contracts. In this case, the manager had appointed the contractor as agent on behalf of the owner, whose claim lay directly against the contractor. If the manager had agreed to provide the blanking on a lump-sum basis, however, the outcome could have been very different, and the manager would have been liable for the actions of the contractor and left to pursue the contractor in a recovery action.

ITIC is managed by Thomas Miller. More details about the club and the services it offers can be found on ITIC’s website at www.itic-insure.com



For more information:
Charlotte Kirk
ITIC

Tel. +44 (0)20 7338 0150
Fax. +44 (0)20 7338 0151
charlotte.kirk@thomasmiller.com

Liberia trials class and statutory e-certificates on ClassNK ships

The Liberian Registry has further strengthened its industry-leading reputation for technological innovation by launching operational trials for electronic certificates covering both statutory and class regulations.

Having initiated the practice of issuing electronic statutory certificates such as Minimum Safe Manning, Civil Liability Convention and Registration Certificates for several years, the Liberian Registry has now started trials on ships classed by Japanese classification society ClassNK for the statutory certificates that it issues on behalf of Liberia.‎ The new e-certificates will have a two-fold benefit for owners and operators. They will significantly reduce the administrative burden associated with handling and managing traditional paper certificates, while facilitating the onboard retrieval of certificated data.

The Liberian Registry began issuing electronic certificates in respect of regulatory compliance in a format developed in accordance with the updated Guidelines for the Use of Electronic Certificates issued by the IMO. Once again, it provided an industry lead in this respect, as it has done now with the extension of the e-certificate initiative to include class requirements.

Scott Bergeron, CEO of the Liberian International Ship & Corporate Registry (LISCR), the US-based manager of the Liberian Registry, says, “Liberia’s intention is always to make regulatory compliance easier and more cost-effective for shipowners and operators. Look at what we have been doing for years in terms of harmonizing ISM and ISPS audits, for example.

“Starting to move towards a system based on the use of e-certificates which can be verified online is the logical next step in the technological transformation of ship registration, and indeed of shipping generally. It will also help to reduce the incidence of fraud and manipulated data. Gone are the days when certain ship registers could allegedly operate successfully out of a back office with little more than a telephone and a fax machine. By contrast, the Liberian Registry’s industry-leading position is based on investment in technology and highly qualified, experienced staff, enabling shipowners and operators to meet their commercial and regulatory obligations.”

“We are delighted that ClassNK chose to co-operate with Liberia in trialing this important initiative embracing both statutory and class requirements on Liberian-flag ships.”

The Liberian Registry has long been considered the world’s most technologically advanced maritime administration. It has a long-established track record of combining the highest standards of safety for vessels and crews with the highest levels of responsive service to owners. Moreover, it has a well-deserved reputation for supporting international legislation designed to maintain and improve the safety and effectiveness of the shipping industry and protection of the marine environment.

www.liscr.com