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Typical voyage charter party clauses in a voyage charter agreement for a cargo vessel

Defining voyage charter party clauses

A general purpose dry cargo voyage charter party will usually incorporate clauses covering the basic provisions tabulated below. The provisions may be expressed in different charter parties by clauses bearing different names, or by numbered clauses with no names.

Name of clauses and matters to be covered are discussed here.


Preamble : Identity of parties; identity of vessel; warranty of seaworthiness; present position of vessel; expected date of readiness to load; obligation to proceed to loading port or place; identity of and safety of loading port or place; amount and nature of cargo to be loaded; obligation to proceed to and identity of discharge port or place; obligation to deliver cargo.

Owners’ Responsibility: Responsibility of the owners for loss of or damage to goods or delay in delivery of goods; exclusion of owner’s liability for loss of or damage to goods or delay in delivery of goods.

Deviation : Liberty of vessel to call at ports in any order; liberty of vessel to tow and assist vessels; liberty of vessel to deviate for purpose of saving life or property or other purposes.

Freight : Rate and amount of payment of freight.

Loading/Discharging Costs: Responsibility for costs of loading and/or discharging of cargo.

Laytime : Duration of laytime allowed; exceptions to laytime; commencement of laytime; time and manner of tendering of notice of readiness.

Demurrage : Duration of demurrage period allowed; whether demurrage allowed at loading and/or discharge ports.

Lien :Whether the owners are to have a lien on cargo for freight, deadfreight, demurrage and/or damages for detention; whether the charterers are to be responsible for freight and demurrage, etc. incurred at the discharge port.

Bills of Lading : Master’s obligation to sign bills of lading.

Laydays and Cancelling : Laydays; cancelling date; conditions under which charterers have option to cancel charter; charterers’ obligation to declare intention to exercise option to cancel, if applicable.

General Average : Rules under which any General Average is to be settled; obligation of cargo owners to pay cargo’s share of General Average expenses.

Agency: Owner’s (or charterer’s) obligation to appoint agents at loading and discharge ports.

Brokerage : Amount of brokerage commission due and party or parties to whom payable.

Strikes : Allocation of responsibility for consequences of strikes or lock-outs preventing fulfilment of obligations.

War Risks : Liberty of owner to cancel charter in event of outbreak of war; liberty of master to sail from loading port before completion of loading in event of outbreak of war.

Ice : Liberties of master in event of inaccessibility of, or threat of trapping at, loading and/or discharge ports due to ice.

Clause Paramount : Identity of liability regime applying to bills of lading issued.

New Jason Clause :Protection of owner against US lawsuits where General Average is to be adjusted in accordance with US law.

Both To Blame Collision Clause: Protection of owner against US law in collision cases.

Law and Arbitration : Jurisdiction to which any dispute will be referred; place of any arbitration; appointment of arbitrators.

Rider clauses : as agreed between the parties, will generally be appended to the standard clauses

Read more on : Voyage charter party laytime calculation




Summarized below seagoing cargo ship various employment guide:
  1. Charty party forms

  2. defines the obligations, rights and liabilities of the shipowner and charterer. Recognised standard form (e.g. GENCON, BALTIME, NYPE)
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    Nature of a time charter
    The charterers agree to hire from the shipowner a named vessel, of specified technical characteristics, for an agreed period of time, for the charterer’s purposes subject to agreed restrictions.
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  3. Voyage charter advantages

  4. contract for the carriage by a named vessel of a specified quantity of cargo between named ports or places.
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  5. Terms of Bareboat charter and lease arrangement

  6. The vessel owners put the vessel (without any crew) at the complete disposal of the charterers and pay the capital costs, but (usually) no other costs.
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  7. Seaworthiness of vessel

  8. A vessel must be fit to encounter the “ordinary perils of the sea” (e.g. bad weather) and other incidental risks to which she will be exposed on the voyage..
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  9. International trade terms (INCOTERMS) in sea transportation

  10. INCOTERMS is a set of rules, published by the International Chamber of Commerce, for the uniform interpretation of the most commonly used trade terms used in international trade contracts.
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  11. Money transfer procedure in sea transport

  12. Money transfer system commonly used in overseas trade to enable sellers to obtain early payment, i.e. soon after shipment of the goods.
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  13. Contract between cargo seller and buyer

  14. The contract of sale between the seller and the buyer of the goods is separate from the contract of carriage which one party or the other, or a third party (such as a freight forwarder), will make with the carrier .
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  15. Parties involved in sea transportation of goods

  16. Forming links in the transport chain- Sea carrier, Freight forwarder, shipper, consignee,agent & banks
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  17. Carriage of goods by sea act 1992 (COGSA 92)

  18. Section 3 of COGSA 92 lays down guidelines establishing when liabilities under a bill of lading, sea waybill or ship’s delivery order will be transferred to a party who is not an original party to the contract of carriage (i.e. an endorsee or transferee). The party who takes or demands delivery of the goods to which a bill of lading, sea waybill or ship’s delivery order relate becomes subject to the same liabilities as the original shipper..
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  19. Laytime interpretation rules

  20. Rules, which were issued jointly by BIMCO, CMI, FONASBA and INTERCARGO, replace the Charter party Laytime Definitions 1980.
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  21. CIF ( Cost, Insurance and Freight ) used in international trade terms (INCOTERMS)

  22. “CIF” means Cost, Insurance and Freight (paid to a named place), e.g. CIF London.- is a contract based on the discharge port
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  23. FOB ( free on board ) used in international trade terms (INCOTERMS)

  24. “FOB” means Free On Board (named port of shipment), e.g. “FOB Newcastle NSW”. It is one of the most commonly used term (INCOTERMS) in sales contracts involving sea transportation of goods.
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  25. Ships employment baltic exchange

  26. Baltic Exchange members undertake to abide by a strict code of business practice, enshrined in the famous Baltic motto “Our Word Our Bond”.
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  27. Ships charter market place

  28. Most ships employed in the charter markets are dry bulk carriers, tankers, combination carriers (e.g. OBOs), or reefer vessels, although there is also a charter market for container ships and for vessels of various special purpose types
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  29. Common Chartering abbreviations

  30. Many terms commonly used by shipbrokers and others involved in ship chartering, mainly to save time and effort in communications. Shipmasters may come across many of the acronyms and abbreviations in documents relating to charters, e.g. in telexed voyage orders and market reports..
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  31. Tanker freight worldscale

  32. "Worldscale" is the code name for the “New Worldwide Tanker Nominal Freight Scale”, published by the Worldscale Association (London) Limited and the Worldscale Association (NYC) Inc
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