The following advice on legal liability during contactless bunkering operations in the Port of Singapore amid the Covid-19 pandemic was written by Paul Collier, senior partner at global law firm Clyde & Co; the drafting was made possible by an arrangement led by the Singapore Chamber of Maritime Arbitration (SCMA):
The risk of the spread of COVID-19 during bunkering operations remains a major concern for ship operators, bunkering providers and authorities, especially when ships have already called at ports with high infection rates.
In addition to the impact on the health of crews and shore personnel, the transmission of COVID-19 during bunkering operations can also have a significant financial impact. If cases of COVID-19 are identified, the crew will be likely to be ordered to quarantine or self-isolate, and bunker ships and barges will be prevented from performing their intended future jobs. Bunker suppliers are worried about the risk of a repeat of the circumstances of the “NewOcean 6”, where several crew members tested positive for COVID-19 and the bunker was forced to cease operations and go into service. quarantine.
Typically, standard bunker terms and conditions do not include express terms dealing with the risk of transmission of COVID-19. However, given the serious consequences and financial impact that may result from the transmission of COVID-19 during bunkering operations, bunkering suppliers and buyers may consider including additional contractual obligations requiring their counterparties to comply. comply with COVID-19 protocols.
The Singapore Maritime and Port Authority has issued circulars which stipulate that contactless bunkering operations must be carried out. The AMP circulars provide (among others) that the crew of a receiving vessel must not embark on a bunker barge (and vice versa) and that the crew of the receiving vessel (instead of the bunker barge crew) must connect the fuel hose to the ship’s manifold.
It is in the interest of all parties to take all measures to reduce the risk of transmission of COVID-19 and to comply with MPA circulars in Singapore. However, the question arises as to what recourse a bunker supplier or buyer will have if their counterpart violates COVID-19 protocols, resulting in the transmission of COVID-19. Under the standard wording of many bunkering contracts, it can be difficult for bunkering suppliers or buyers to recover losses resulting from a breach or counterparty breach of COVID-19 protocols. In addition, the ability to claim damages may be limited by contractual provisions restricting the ability to recover indirect losses.
If they do not already do so, bunkering suppliers and buyers may therefore wish to insist that an explicit contractual wording states that for bunkering operations taking place in Singapore, the other party will comply with all of its obligations under of the latest AMP circulars, so that if there is a violation of COVID-19 protocols by the other party resulting in COVID-19 infection of their crew, there is a clearly identifiable breach of contract that they can use as a means of seeking to recoup losses. Separately, bunkering providers may wish to consider whether their contractual terms should be changed to protect their position in the event of a loss resulting from the failure of the receiving vessel’s crew to properly connect the fuel hose, and whether Additional arrangements should be made with respect to witness sampling at the receiving vessel’s manifold, taking into account movement restrictions between vessels.
Senior Partner, Clyde & Co Clasis Singapore Pte. Ltd.
Direct dialing: +65 6544 6569
Email: [email protected]
Photo credit: Manifold Times
Posted: July 21, 2021