2. The Chartering process Flashcards
Standart charter party types?
GENCON OREVOY COALCOY AUSTWHEAT for voyage chartering
NYPE
BALTIME
for time chartering
VOLCOA
for contracts of affreightment
BARECON
for bareboat chartering
Most common categories of the business brokers specialize in?
The owner’s broker - appointed by owners to secure charters for their tonnage.
The Charterer’s broker - Act under instruction from the charterer.
The intermediate Broker - Neither owners’ nor charterers.
The sale&purchase broker - requires knowledge of ships tehnical and classification as well broader base of ships’ valuation.
Represents one party.
Usual commission of the Sale&Purchase?
Usually approx. 1 percent.
Broker’s role?
Match orders with positions and maintain a database of ships, positions and orders.
Monitor list of open cargoes (orders) and open tonnage (positions)
Consolidate market intelligence
Handle and assist communications
Draw up the charter party agreement
Deal with amendments
Deal with financial transactions
Laytime?
Owner gives to the charterer a specific time which is period of time allowed in a voyage charter for the loading and unloading of cargo.
Demurrage?
Charterer must pay damages to the owner in the form of demurrage at a negotiated sum per day in case if the charterer fails to load or discharge the cargo in the given period of laytime.
Dispatch?
Form of reward to the charterer by owner for completing cargo operations earlier than laytime.
NOR - Notice of Readiness
The point in time when laytime starts.
NOR informs the chartere that the ship has arrived at the port and is ready to load or discharge.
2 types of contract for the carriage of goods by sea?
- A contract evidenced by bill of lading.
- Charter party
Although different things ship carrying cargo is often running under both.
Bill of Lading?
Contract between a carrier and a shipper.
Functions of Bill of Lading?
It is a receipt of the cargo shipped.
Receipt for the quantity of goods + condition of the goods.
It provides evidence of the contract of carriage.
Terms on which goods have been shipped.
Serve as document of title to the goods.
Process connected with Bill Of Lading?
Once bill of lading is signed by the carrier goods will be handed over to the shipper.
When Bill of Lading is not issued?
Until the cargo is shipped on board, and the shipper as owner of the goods becomes jointly and severally liable to the carrier for any nonpayment of freight due.
Sea waybill?
Is not document of title but it bears the name of the consignee who must only identify himself in order to take delivery.
Information included in bill of lading?
- Accurate description of cargo
- Ship’s name
- Date of bill of lading
- Name of shipper and consignee
- Loading and discharging ports
- Payment of freight
- Number of bills of lading
- Signature
- Terms of carriage
- Security of payment/ letter of indemnity
Letter of indemnity? (LOI)
Mostly carrier will not give delivery of cargo without production of the fully negotiable bill of lading.
However carrier may decide to hand over the cargo if LOI presented from a reliable party (such as bank).
If the bill of lading is not available at a discharging port, Letter of Indemnity is used, which fully guaranteed by reputable bank.
Order?
Charterer in need of ship entering the market.
Position?
Shipowner seeking cargo entering the market.
Order contained of?
- Charterers name and domicile.
- Type of cargo.
- Volume of cargo and stowage factor.
- Ports of loading and discharge.
- Loading window/laycan - the dates when vessel is expected to be ready for loading.
- Loading discharge rates (desired) and terms.
- Freight indication
- Charter party form to be used
- Commission payable by owner.
- Other information.
DWT? SDWT?
The maximum weight (usually in tons) that can be loaded on ship.
Deadweight. or summer dead weight.
Position?
- Type of vessel, name, when and where it will be open.
- Ship specifications, age flag, SDWT, draft, LOA, beam, GT, NT, speed, consumption
- Hold and Hatch specification
- Grain and bale capacity
- Volume of cargo and SF
- Loading/discharge rates (proposed)
Offer?
If an owner is interested in responding to the order, he will make an offer.
Laycan or L/C - Laydays Canceling?
Period denoted by two dates during which the shipowner must tender notice of readiness to the charterer that the ship arrived at the port of loading.