BIMCO introduces two new clauses for sanctions

Chamber of Shipping > Blog > News > International > BIMCO introduces two new clauses for sanctions

BIMCO’s Documentary Committee has approved two charter party sanctions clauses to help owners and charterers manage due diligence policies and navigate an increasingly complex environment of economic and trade sanctions imposed by governments. The clauses are intended for use in all trades, except for the container trades which require more specialized provisions, and BIMCO is currently developing a separate sanctions clause for container operators which will be released early next year.

The benefit of using the clauses is twofold; They provide the ability to terminate the contract and to claim damages in limited circumstances when the counter party and/or the third parties listed in the warranties are sanctioned. BIMCO has chosen termination as the appropriate right in this context because that is often a breach which is incapable of being remedied. That changes however, when the performance of the charter party involves a sanctioned activity or third party. A right to change voyage orders and/or suspend performance is a more appropriate remedy when the performance involves a sanctioned activity or person.

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