BIMCO 2020 Bunker Clauses *Update*

12 December 2018

BIMCO has now published two sulphur content related bunker clauses to help shipowners and charterers prepare for the 2020 global sulphur cap.

These clauses are:

• BIMCO 2020 Marine Sulphur Content Clause for Time Charter Parties (which replaces the BIMCO Fuel Sulphur Content Clause 2005)
• BIMCO 2020 Fuel Transition Clause for Time Charter Parties (which deals with the one-off event of switching from 3.50% sulphur content fuel to 0.50% sulphur content prior to 1 January 2020)

The 2020 Bunker Clauses were developed by a team of industry experts that included North’s Tiejha Smyth (Deputy Director – FD&D).

The clauses are available to BIMCO members on the BIMCO website.

For more information on the sulphur cap, visit our dedicated Insights area ‘2020 Vision’.

15 November 2018

BIMCO have announced two new bunker clauses for time charters will be published later this year.

The Global Marine Fuel Sulphur Clause for Time Charter Parties will be released alongside a clause that deals with the transitional period from the end of 2019 to the beginning of 2020.

The BIMCO press release can be read here.

08 October 2018

The BIMCO group tasked with developing charter party solutions for 2020 has decided to release new clauses separately over the next few months after a meeting at BIMCO house on the 19^th September.

It was determined that it would be difficult to produce one clause to cover all 2020 issues. The plan is therefore to divide the 2020 bunker issues into four distinct projects as shown below:

Compliance after 01.01.2020 – BIMCO 2020 Global Marine fuel sulphur content clause for Time Charter Parties

At the meeting on the 19^th September, the group produced a draft “compliance clause” setting out a time charterers’ obligations and liabilities in providing fuel of the required sulphur content post 2020. Owners remain responsible for fuel management. BIMCO expects the new clause to be used by time charterers in the future as standard and reviewed by the documentary committee. The aim is then to have a final revised draft ready for November.

Transitional period

Work on this second clause will start shortly which is aimed at the transitional period before and shortly after 1^st January 2020. The expert group will consider issues such as:

• Quantities of residual fuel on board at redelivery
• Tank cleaning costs
• Disposal of residual fuel
• Final bunkering of ships before redelivery by time charterers – there will need to be  sufficient 0.5% sulphur content fuel on board so that the vessel can reach the next port where compliant fuel is available

This clause should be ready early 2019.

Scrubbers

This has been given a lower priority because only a small percentage of vessels will have scrubbers fitted. The group will consider the following when drafting this clause:

• Cost sharing between owners and charterers for installation of scrubbers
• A cost sharing formula based on the expected life of the scrubber vs the remaining duration of a time charter
• Potential scrubber breakdowns
• Reserves of compliant fuel required on board

The aim is for a final draft to be published by mid 2019.

Review of BIMCO’s existing suite of time charter bunker clauses

This is the final phase of the 2020 project and will involve review of the following clauses mid-2019 if considered necessary:

• Clauses relating to bunkering issues such as:
  • operations and sampling;
  • quality and liability;
  • fuel testing;
  • types and quantities on redelivery.

The full circular can be read here.