Released in May, the 2016 amendments to the MYBA Charter Agreement have been attracting attention as the industry becomes aware of the revised contract.

The majority of the changes are minor, intended as qualifiers to clarify pre-existing clauses. However, there have been significant amendments to Clause 19, regarding incidences of salvage, and to Clause 20, regarding the payment of charter fees and other monies to the owners.

With regards to Clause 19, MYBA have reverted back to previous wording that existed in the 2002 agreement, following the committee’s decision that this version explains the process more clearly.

Clause 19 now states that; “During the period of the Charter, the benefits, if any, from any derelicts, salvages and towages, after paying the Crew’s proportion, and a proportion of the Charter Fee during the time when the Vessel is engaged in providing salvage assistance, and expenses during this time directly related to the salvage, shall be shared equally between the Owner and the Charterer.”

The alteration to Clause 20, regarding payment of charter fees, includes clarification of the correct procedure to respond to complaints, which up until now was a topic that had drawn a lot of queries.

With the revision, the agreement states that the balance of the charter fee shall be paid to the owner on the first working day following completion of the charter period, unless the stakeholder receives written notice of a complaint by or on behalf of the charterer.

“Once such notice of complaint has been received by the Stakeholder, the Stakeholder shall be obliged to retain the balance of the Charter Fee for a period of [14] days,” the agreement now states. “If during such [14] day period the Charterer’s complaint is resolved by agreement with the Owner then the Stakeholder shall pay the balance of the Charter Fee to the Owner (or as otherwise directed in an Arbitration Award).

“If after [14] days neither party shall have appointed an arbitrator then the balance of the Charter Fee shall be paid by the Stakeholder to the Owner on the first working day after the 14 day period referred to above. If either party shall have appointed an arbitrator then the Stakeholder shall retain the balance of the Charter Fee in a designated account until an Arbitration Award has been published or the matter settled by mutual agreement between the parties.”

Speaking exclusively to, Barbara Dawson, former Chair of the Charter Committee, explains that these changes were discussed at length by the Charter Committee and MYBA counsel, due to the various issues over the years that had been brought to MYBA’s attention. “We had frustration coming from all sides – charterer, owner, broker, and stakeholder – hence this was a way to sort out issues that arose in a fair and timely manner,” she explains.

“There was a need to have a ‘trigger’ in the contract that would clearly outline the procedure to allow all parties to negotiate or move to arbitration. The clause is a fair balance to both parties as it outlines a time period in which to take an action to hopefully a satisfactory outcome for everyone. It allows a valid claim to be reviewed by the parties and, if serious enough, the time needed to start arbitration.  In most instances the grievances can be negotiated by the parties in a quick and timely manner specifically thanks to this clause.”

While these amendments do not diverge far from usual industry practice, the aim of the revised agreement is to qualify and clarify practices further for the charter sector. With this document, MYBA aims to be fair to all parties involved, which can be a challenging balancing act, and as such is already welcoming feedback to put forward for the next version.

Access to the revises MYBA Charter Agreement can be found here.

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