Changes to specialist General Average Clauses
Overview
At its meeting in Rome in June 2017, the Documentary Committee agreed that specialist provisions dealing with the mechanics of General Average should be modified to ensure consistency with user requirements and market arrangements.
The Documentary Committee agreed in May 2016 that all new and revised BIMCO charter parties, bills of lading and waybills should provide for the adjustment of general average in accordance with the updated York-Antwerp Rules (YAR) 2016 adopted earlier that month by the Comité Maritime International (CMI). At its meeting in Rome in June 2017, the Documentary Committee agreed that specialist provisions dealing with the mechanics of General Average should be modified to ensure consistency with user requirements and market arrangements.
The BIMCO Average Bond Clause, last revised in 2007, aims to minimise the time taken to obtain security from individual cargo interests and their insurers and thus reduce delay in delivery of cargo following a General Average incident. An updated version is now available as the BIMCO Average Bond Clause 2017 for use in contracts of carriage where General Average is to be adjusted according to the York-Antwerp Rules 2016. Nevertheless, the York-Antwerp Rules 1994 are likely to continue in use for the time being. Accordingly, the 2007 version of the Clause has been maintained and must be used if the York-Antwerp Rules 1994 apply to an underlying contract of carriage.
Under the BIMCO Standard General Average Absorption Clause, hull insurers pay the costs of General Average up to an agreed sum thus eliminating low value claims where the costs are often disproportionate to the eventual recovery. In contrast to owners’ contracts of carriage where different versions of the York-Antwerp Rules might apply, the Absorption Clause is for inclusion in marine insurance policies. As it therefore forms part of the contract between owners and insurers, it follows that it should give effect only to the latest version of the York-Antwerp Rules. The Clause, originally issued in 2002 and linked to YAR 1994, has therefore been updated to apply the York-Antwerp Rules 2016. The earlier version should no longer be used.
Copies of the provisions and accompanying explanatory notes can be viewed via the above links.
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Posted:
04 July 2017
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