25 April, 2020
More than 4.5 billion people – half the world’s population, are living under social distancing measures.[1]
Despite the impact of COVID-19, the shipping industry is expected to continue playing an important role in supply chain and logistics, and in keeping the affected countries’ economies and essential activities going.
This is particularly true in some of the hardest hit countries such as Italy, Spain, United Kingdom and small nations such as Singapore, where port services for vessels carrying cargo and goods remain operational, albeit with suitable measures put in place.[2]
Despite the above, could certain ports be deemed “unsafe”, as countries place restrictions on the crews and vessels that have called at ports of certain countries with a high level of COVID-19 infections?
Time or voyage charter parties containing clauses such as BIMCO’s Infectious or Contagious Diseases Clause for Time Charter Parties (and equivalent clause for Voyage Charter Parties) (“IOCD Clause”), allow for vessel owners to refuse to call on an “unsafe port”.
If nevertheless, the option is waived and the vessel proceeds, the IOCD Clause provides that the additional costs of measures taken to protect vessel and crew will be the responsibility of the charterers. Such costs may include cleaning, quarantine and sanitisation or fumigation costs arising from calling at an unsafe port.
The IOCD Clause for voyage charter parties expressly limits application of the clause to situations arising after the date of the charter party.[3]
The IOCD Clause provides a broad definition of an “Affected Area”, as “any port or place there is a risk of exposure to the Vessel, crew or other persons on board to the Disease and/or to a risk of quarantine or other restrictions being imposed in connection with the Disease.”
Whether the port falls within the definition of “Affected Area” which would justify a refusal to proceed, is a factual issue and for the owner/master to determine, on a “reasonable judgment” basis, whether the vessel may be allowed to proceed.
The key factor to be considered in such an assessment would therefore be whether there is a risk of exposure to the disease and/or to a risk of quarantine being imposed on the vessel, crew or other persons on board.
If there is such a risk, the owner would be entitled to notify the charterers of such unsafe port and charterers will be required to issue alternative voyage orders or nominate alternative ports after such notification from owners.
Given the evolving scenarios on restrictions for ports of different countries, owners/masters will have to make their careful assessments on a case-by-case basis. Several websites regularly monitor and update the shipping community regarding the various COVID-19 governmental restrictions on vessels arriving at port. For example, BIMCO has a list of implementation measures around the globe which is updated several times per day.[4]
Given that the carriage of goods by sea is essential to the continued running of the world economy, it may be necessary for vessels to continue with operations in ports, which have introduced safe-distancing or heightened measures to combat COVID-19.
Ship operators should refer to and implement the Coronavirus (COVID-19) Guidance for the Protection of the Health of Seafarers, issued by International Chamber of Shipping in March 2020 (the “Guidance”). The publication was produced to assist shipping companies in following advice provided by the World Health Organisation (WHO), the International Maritime Organisation (IMO) and the International Labour Organisation (ILO).
In the current uncertain climate, it is prudent for shipping companies to take a cautious approach by following the Guidance and complying with the relevant governmental measures, in order to protect the crew members’ health and wellbeing, as well as prevent escalation of any risks of calling at an “unsafe” port.
