Why GMT Matters More Than You Think in Charter Parties: Demystifying Clause 39

🕰️ Why GMT Matters More Than You Think in Charter Parties: Demystifying Clause 39

❓ Are You Sure You’re Calculating Hire Correctly Across Time Zones?

❓ Could Misinterpreting Time Zones Be Quietly Costing You Thousands?

❓ Do You Know Why Charter Parties Often Insist on GMT for Delivery/Redelivery?

 

🔍 Clause 39 – Time Clause: What It Really Means

Clause Text:
“Time on delivery/redelivery to be based on Greenwich Mean Time (GMT) for hire calculation.”

This seemingly simple clause packs more punch than meets the eye. By standardizing time reference to GMT, the charter party ensures a uniform basis for hire calculations, regardless of where in the world the vessel is delivered or redelivered.

📘 Why Use GMT?

• Consistency: Ships operate globally, crossing multiple time zones. GMT eliminates confusion in tracking time-related obligations.
• Clarity in Billing: Ensures both owners and charterers use the same baseline, especially critical for voyage demarcations and precise hire computation.
• Dispute Prevention: Ambiguities over “local time vs. UTC vs. GMT” can lead to expensive arbitration or litigation.

 

⚠️ Implications & Common Pitfalls

• Mistaking Local Time for GMT: Operators may record delivery/redelivery at a local port time, leading to billing errors.
• Time Conversion Errors: Failing to adjust for daylight saving time (DST) or using incorrect conversion tools.
• Unclear Time of Day in Delivery Notices: Notices sent at “08:00” must specify GMT to avoid disputes.

🧠 Real Example:

A redelivery notice from a vessel discharging in Singapore at "12:00 local time" (UTC+8) was used without conversion. The owners billed 8 hours extra hire, leading to a USD 25,000 claim, later settled with costs.

⚖️ Legal Insight:

While not tied to a specific BIMCO clause, this provision is commonly accepted in Shelltime and NYPE charters. Maritime courts generally uphold GMT-based interpretations when explicitly stated in charter terms.

 

✅ Pro Tips & Action Steps

For Operators/Managers/Charterers:

1. 📅 Standardize Your Time Logs: Always log key events (delivery, redelivery, notice issuance) in GMT, even if locally timestamped.
2. 🧭 Use Verified Tools: Rely on trusted GMT converters or vessel reporting software with UTC/GMT time capture.
3. 📝 Explicitly State Time Zones in all written communications, especially hire statements and voyage updates.
4. 📑 Align Notices with Clause: Ensure your delivery/redelivery notices reference GMT as per the charter clause.
5. 🔄 Train Ops Staff: Include a “Time Zone Discipline” module in your ops SOP.

 

🧭 Conclusion: Clarity is Currency in Shipping Ops

Time might be a constant, but its interpretation in shipping can vary wildly—unless you anchor it to GMT. Clause 39 may appear technical, but it safeguards against miscommunication, billing disputes, and operational inefficiencies.

By mastering GMT-based hire calculation, you're not just ticking a box—you’re proving your operational excellence.

 

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⚠️ Disclaimer

This blog is intended for general informational purposes only and does not constitute legal or operational advice. Please consult your charter party, legal team, or P&I Club for specific guidance related to your contracts.