Red Sea issues – many ships deviate

Red Sea issues - many ships deviate | BDM Blog | BDM Law

We continue to see questions coming in on the Red Sea crisis.

On Friday US Naval forces advised all vessels to avoid the Red Sea for at least the next 48 to 72 hours. The Combined Maritime Forces (CMF) which makes up 39 member nations including the US, UK, France, India and Japan and under the command of the US Naval forces commander co-ordinated from Bahrain also advised all ships to avoid transiting the Bab al Mandeb Strait for “several days” and stay above 16N and east of 46E. BIMCO and INTERTANKO have backed those warnings with circulars to their members. The UKMTO currently advise vessels transiting the area to exercise caution and follow flag state and industry guidance. Most shipowners are now avoiding the Bab al Mandeb Strait completely which means that the Red Sea is effectively out of bounds. This is having a serious impact on the Suez Canal with transits substantially down.

From a legal point of view, the issues are whether ship owners who are due to transit the Red Sea should turn back, how they do that and what procedures they should follow to do so. Many charter war risk clauses require notices to be given to Charterers inviting them to nominate alternative ports failing which ship owners have discretion to deviate. Having said that, the ship owner is often in a bind having issued bills of lading for a named port. Can they deviate there via a different route and, if so, who is legally obliged to bear the costs associated with that deviation?

This issue is now stark because some ship owners were on their way through Red Sea some having loaded in Europe. In one case we are advising a ship owner who, having transited Suez on the way to Asia has now turned back. They now face a huge diversion via Suez, Gibraltar and the Cape of Good Hope. Understandably the time charterers are far from happy with the additional costs involved (which will include two canal fees plus substantial extra hire and bunkers). It is perhaps not surprising that time charterers are looking for any options to avoid incurring those costs. Some of these issues may eventually find their way to arbitration.

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Nick Burgess
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