Cargo Shortage, Damage & Delays in High-Risk Ports: Who Pays the Price?

 ⚠️ “Cargo Shortage, Damage & Delays in High-Risk Ports: Who Pays the Price?” 🌍💰

 

❓ Ask Yourself These 3 Questions Before Calling at Syria, Libya, or Nigeria:

1. ✅ If cargo is short or damaged in a conflict zone, who bears the liability—you or the Charterer?
2. ❌ Do you know who posts guarantees or deposits to free your vessel if she’s held at port?
3. ✅ Is your vessel still earning hire if stuck due to a claim in these regions?

 

🔍 Clause 36 – Short Claim Clause Decoded for Maritime Professionals

Clause 36 of the Charter Party, often overlooked, is critical when trading in politically unstable or high-claim jurisdictions such as Syria, Libya, Yemen, Nigeria, and Algeria. Here's what it really means for you:

 

🧾 Plain Breakdown:

1. Charterers Take Full Risk in Specified Ports
   If the vessel is discharging at any of the named ports, Charterers are fully liable for:
• Shortage claims (cargo missing or less than declared).
• Contamination, infestation, or off-specification claims.
• Physical damage to the cargo.
2. Charterers Must Defend and Settle Claims
• They must handle any legal, commercial, or insurance issues that arise.
• At their own time, risk, and expense.
3. Charterers Must Free the Vessel
• If the vessel is detained due to a cargo-related claim, Charterers must provide security, post a bank guarantee, or do whatever is required to release the ship.
• Any assistance provided by Owners (e.g., legal, documentation) is at Charterers’ cost.
4. The Vessel Remains on Hire
• Even if detained at one of these ports due to such claims, the ship continues to earn hire.
• Owners are not penalized for delays beyond their control in these zones.

 

⚖️ Real-World Risks and Common Pitfalls:

• Claims Culture in High-Risk Zones:
  Cargo short delivery claims, especially at Nigerian or Syrian ports, are rampant, often filed without merit.
  This clause protects Owners from costly local lawsuits or delays.
• Unclear Responsibilities:
  Without this clause, Owners may be wrongly exposed to claims or required to post large deposits—sometimes hundreds of thousands of dollars.
• Detentions & Legal Battles:
  Detentions can last weeks. Clause 36 ensures Charterers bear the full brunt, legally and financially.
• Contract Conflicts:
  Bills of lading or sub-charter party clauses may conflict—this clause takes precedence under the main Charter Party.

📚 Tip: Always review BIMCO's guidance on risky trading areas and consider local P&I Club alerts.

 

🛠️ Actionable Steps for Stakeholders

🔹 For Owners:

• 🛡️ Ensure Clause 36 (or similar) is clearly incorporated into Charter Party agreements when calling high-risk ports.
• 🔍 Review local port risks and claim histories—get input from your P&I Club.
• 📂 Document cargo condition meticulously—photos, tallies, and reports.

🔹 For Charterers:

• 💼 Arrange cargo insurance that covers liability in the named ports.
• 📝 Prepare in advance for potential detentions—have bank guarantees or local legal contacts on standby.
• 🚨 Keep vessel management and agents informed of any expected formalities or known port risks.

🔹 For Operators / Fleet Managers:

• 🔗 Coordinate closely with agents and local correspondents in listed countries.
• 🧾 Require pre-arrival cargo status confirmations and discharge protocols.
• 🚢 Avoid misrepresentation of cargo quantity or quality—it triggers Clause 36 consequences instantly.

 

✅ Conclusion: Risky Ports, Clear Lines of Responsibility

Clause 36 draws a hard line between Owner and Charterer responsibilities in conflict-prone and high-claim countries. It reinforces that cargo-related claims and vessel detentions in listed ports are Charterers’ burden, not the Owners’—and hire continues regardless of disruptions.

🚢 Whether you're an Owner, Operator, or Charterer, knowing your obligations in tough jurisdictions is not optional—it’s operationally critical.

 

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