BIMCO Unveils Two 2020 Sulphur Clauses

BIMCO, the world’s largest shipowner association, has published two sulphur content related bunker clauses aimed at facilitating the industry’s switch to low sulphur fuels in 2020.

The two clauses are BIMCO 2020 Marine Sulphur Content Clause for Time Charter Parties and BIMCO 2020 Fuel Transition Clause for Time Charter Parties. The clauses were developed by a team of shipowners, charterers, bunker suppliers, P&I clubs and legal experts.

“The subcommittee’s objective has been to create clauses that are simple and practical, and I’m confident we’ve achieved that objective,” says Peter Eckhardt, chairperson of the drafting committee and Head of Chartering and Operations at Reederei F. Laeisz.

The 2020 Marine Fuel Sulphur Content Clause replaces the BIMCO Fuel Sulphur Content Clause 2005 and can be incorporated into time charter parties as of now. The new clause forms an integral part of BIMCO’s Suite of Standard Bunker Clauses for Time Charter Parties.

BIMCO said that issues relating to the specifications, grades and quality/suitability of the fuel supplied by time charterers are covered by existing standard bunker clauses in time charters, so these should not need to be amended in relation to sulphur content alone.

The 2020 Fuel Transition Clause is not part of the Suite of Bunker Clauses as it deals with the one-off event of switching from 3.50% sulphur content fuel to 0.50% sulphur content.

As the switch will need to be started before January 1, 2020, it requires the owners and charterers to cooperate to ensure a smooth transition. BIMCO explained that the clause is designed to provide a fair allocation of responsibilities and liabilities between the owners and charterers in managing remaining stocks of fuel that will become non-compliant under MARPOL.

As informed, the clause has been specifically designed for time charter parties that will span January 1, 2020.

“We would also recommend incorporating the clause into time charter parties with redelivery very close to 1 January 2020 where delays or extensions might result in the ship redelivering after the date the change comes into force,” Grant Hunter, BIMCO head of Contracts & Clauses, said.