We see many cases where poorly drafted or inconsistent dispute resolution clauses have created confusion. We would therefore encourage all our clients to consider using a standard arbitration clause as a template. From time to time, these templates are reviewed. For many years BIMCO has put forward a standard clause and it has just been revised. The main differences are:
- A general overhaul of the structure of the clause. It is now shorter and more simplified. There are more options now on the arbitral seat although it remains to be seen if this will have any impact on the majority of cases being referred to arbitration in London.
- The mediation clause is now freestanding which allows parties to choose whether or not they want to include mediation, rather than having to strike it out.
- There is a provision dealing with notices which provides a mechanism to deal with sending notices and communications relating to the arbitration. This is a welcome change as it removes some of the potential disputes that can arise when notices are given and it is later alleged that they were sent to the wrong person or address. Parties are free to choose the effective means of serving notice of arbitration but they need to provide the email address of someone authorised to receive arbitration notices. Notices are considered effectively served immediately on sending by email.
These are all welcome changes and we would urge clients to use the template even if they wish to make changes. We expect that the new clause will eventually appear in the majority of new shipping contracts.
