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Charter Parties: The Complete Guide – Types & Agreements

August 21, 2023

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Charter Parties The Complete Guide

Charter parties , the legal contracts for chartering vessels, are the backbone of international shipping. They define the rights and obligations of shipowners and charterers, ensuring smooth operations on voyages. Whether it’s a time charter or a voyage charter, these agreements play a crucial role in facilitating global trade for carriers.

A charter party is not just any document; it serves a specific purpose in the context of chartering. Its clauses, articles, and provisions outline the terms that govern the relationship between parties involved in maritime commerce, typically in a contract. Shipowners carefully craft these agreements, known as charterparties, to protect their interests while meeting the needs of charterers who engage their services as carriers.

Understanding charter parties is essential for anyone venturing into international shipping. From specifying the duration of the charter period to determining responsibilities during loading and unloading, every detail matters in chartering. So let’s dive into this intricate world of maritime contracts and explore how they shape our interconnected global economy, specifically in relation to carrier and specific cargo.

Types of Charter Parties

Time charters.

A ship chartering, or time charter, involves leasing a vessel from a ship owner for a specific period. This type of charter party allows the charterer, or carrier, to have exclusive use and control over the vessel during the agreed-upon timeframe. It provides flexibility as the charterer can determine the ports of call and cargo carried.

Voyage charters

Voyage charters in ship chartering involve hiring a vessel for a single journey. Unlike time charters, which focus on an extended period, voyage charters are specific to one trip. The charterer pays the ship owner for transporting goods from one port to another without long-term possession or control over the carrier.

Bareboat charters

Bareboat charters involve ship chartering by leasing a vessel without crew or provisions. In this type of arrangement, the charterer assumes complete responsibility for operating and maintaining the ship during the agreed charter party duration. The shipowner transfers possession and control to the charterer, who becomes the carrier responsible for all aspects of navigation, crewing, and provisioning.

These main types of charter parties, including time charters, voyage charters, and bareboat charters, offer different options depending on the specific needs and requirements of the charterparty, carrier, ship owner, or shipowner. Time charters provide flexibility and extended use, voyage charters focus on individual trips, while bareboat charters grant full control to the lessee. By understanding these various types, individuals and businesses can choose which option best suits their particular circumstances.

Charter Party Agreements

Charter party agreements, also known as charterparty agreements, are legally binding documents that are negotiated between shipowners and charterers. These agreements specify important terms such as freight rates, laytime, demurrage, and more. Here’s a brief overview of charterparty agreements and how they form an essential part of container shipping.

• Charter party agreements, also known as charterparty agreements, are contracts that outline the terms and conditions of the chartering arrangement for container ships. They are typically negotiated between the shipowner, who owns the vessel, and the charterer, who will be using the container ship for a specific period or voyage.
• Charter party agreements include various provisions that define important aspects for ship owners. This includes details about freight rates (the cost of hiring the vessel), laytime (the allowed time for loading and unloading cargo), demurrage (additional fees if there is a delay in cargo operations), and other relevant terms.
• Legally binding documents: Once both ship owners agree to the terms outlined in a charter party agreement, it becomes a legally binding document. This means that both ship owners are obligated to fulfill their respective responsibilities as stated in the agreement.

Charter party agreements play a crucial role in the shipping industry by providing clarity and protection for all parties involved. They ensure that both shipowners and charterers understand their rights and obligations throughout the duration of the charter. Whether it’s a slot charter (a partial space booking) or a demise charter (complete transfer of vessel control), these agreements establish clear guidelines for smooth operations.

The Importance of Charter Parties in International Trade

Charter parties play a vital role in facilitating global trade, ensuring the efficient transportation of goods by sea. These agreements establish clear responsibilities and liabilities for both shipowners and charterers, promoting smooth operations and minimizing disputes. Let’s explore why charter parties are crucial in international trade.

• Facilitate global trade by providing vessel availability : Charter parties enable shipowners to make their vessels available for hire, allowing them to meet the demand for transporting goods across borders. This availability ensures that businesses can access reliable shipping services to move their products worldwide.
• Ensure efficient transportation of goods by sea: By defining the terms and conditions of carriage, charter parties help streamline the logistics process for ship owners. They specify loading and unloading procedures, delivery timelines, and any additional requirements for cargo handling. This clarity promotes efficiency and helps avoid delays or misunderstandings during transit, benefiting both shipowners and the overall shipping industry.
• Establish clear responsibilities and liabilities: Charter parties outline the obligations of both shipowners and charterers, ensuring accountability throughout the voyage. They determine who is responsible for vessel maintenance, crew expenses, insurance coverage, and compliance with maritime regulations. Clearly defined responsibilities minimize uncertainties and protect all parties involved.

Charter Parties and Bills of Lading

A bill of lading issued under charter party terms serves as a crucial document for shipowners in the shipping industry. It provides evidence of cargo receipt and condition, making it essential for transferability and financing.

• Under voyage charters or bareboat charters, a bill of lading is often issued to acknowledge the receipt of specific cargo by the shipowner or charterer.
• This document is essential for shipowners and charterers in the shipping industry as it serves as proof that the cargo has been loaded onto the ship and is in good condition. It is particularly important for both bareboat charter and voyage charter party agreements during the specified charter period.
• Charter parties facilitate the agreement between the shipowner (or bareboat charterer) and the charterer, outlining their respective rights and responsibilities.
• The bill of lading acts as a contract between the carrier (shipowner) and the shipper (charterer), ensuring that both parties fulfill their obligations.
• For freight forwarders, having a bill of lading issued under charter party terms allows them to confidently arrange transportation for their clients’ cargo with the ship owner’s assurance.
• The bill of lading also enables financing options for shippers who may need to use it as collateral or provide proof of ownership for obtaining loans during a bareboat charter, slot charter, or voyage charter party within the charter period.
• In addition to its importance in commercial transactions, bills of lading issued under charter parties serve as critical documents for ship owners’ insurance claims related to damaged or lost cargo.

Charter parties and bills of lading are integral components within the shipping industry. They ensure smooth operations, protect stakeholders’ interests, and provide necessary documentation for various purposes.

Ship Speed and Fuel Consumption in Time Charter

Ship speed plays a crucial role in determining fuel consumption within time charter agreements. The rate at which a vessel travels directly impacts the amount of fuel it consumes during its journey. Here are some key points to consider:

• Slow steaming: Slowing down the ship’s speed can significantly reduce fuel costs. By adopting this practice, charter parties can achieve substantial savings. However, it is important to note that slow steaming also extends the duration of the voyage.
• Cost versus time: When deciding on ship speed, charter parties must strike a balance between cost reduction and voyage duration. While slower speeds may result in lower fuel consumption, they can lead to longer transit times, affecting overall efficiency and profitability.
• Fuel efficiency considerations: In time charter agreements, fuel efficiency is a critical factor that influences financial outcomes. Parties involved must carefully evaluate the impact of ship speed on fuel consumption to ensure optimal profitability.

By considering these factors, charter parties can make informed decisions regarding ship speed and its effect on fuel consumption within time charter agreements. Achieving the right balance between cost reduction and voyage duration is essential for maximizing profitability while maintaining operational efficiency.

Understanding Laytime and Total Laytime

Laytime, a crucial aspect of charter parties for ship owners, refers to the time allowed for loading/unloading cargo. It determines the financial implications for both ship owners and other parties involved. Exceeding the laytime incurs demurrage charges, resulting in additional costs for ship owners.

Key points to understand about laytime and total laytime:

• Laytime : Laytime is the agreed-upon period during which the charterer has the right to load or unload cargo. It is typically expressed in days, hours, or even minutes. The clock starts ticking once the vessel arrives at the designated port or berth.
• Demurrage : When laytime is exceeded due to delays caused by either party, demurrage charges come into play. Demurrage refers to the money the charterer paid to compensate for the extra time taken beyond the agreed-upon laytime. This ensures that shipowners are compensated for any lost time and potential revenue.
• Financial Implications : Understanding laytime is essential because it directly impacts both parties’ financial interests. For shipowners, shorter laytimes result in quicker turnaround times and increased efficiency. On the other hand, charterers aim to maximize their use of laytime while avoiding demurrage costs.

By comprehending these concepts related to laytime and total laytime, ship owners and other parties involved in charter parties can effectively manage their operations while minimizing potential financial risks.

Remember: Promptly completing loading or unloading operations within the agreed-upon timeframe helps avoid unnecessary expenses and contributes to smoother logistics processes for all stakeholders involved in the ship charter, slot charter, voyage charter party, and charter party chain.

Safe Port Requirements in Voyage and Time Charters

Voyage charters require the charterer to transport cargo from one port to another by ship. In these agreements, it is crucial for the charterer to ensure that the chosen ports for cargo operations meet certain safety requirements. Similarly, time charters impose an obligation on the charterer to nominate safe ports throughout the duration of the agreement.

The selection of a safe port is crucial for ships due to the potential risks involved. Safety concerns encompass navigational hazards, ship security measures, and infrastructure conditions. By considering these factors, charter parties can mitigate dangers and ensure smooth ship operations.

Here are some key points regarding safe port requirements for ships in both voyage and time charters.

• Charterers must carefully evaluate the safety aspects of each port before initiating cargo operations on their ship.
• When entering a voyage charter party, it is essential to consider navigational hazards such as shallow waters, narrow channels, or unpredictable weather conditions that may be encountered during the ship’s journey.
• Security measures at ports are crucial in safeguarding cargo, whether on a ship or on land, from theft or any other criminal activities.
• The responsibility to nominate safe ship ports lies with the charterer throughout the duration of the contract.
• It is essential for charterers to stay updated on any changes in safety conditions at nominated ports to ensure their ships’ safety.
• Regular communication between all parties involved in the ship ensures that any safety concerns related to the ship are promptly addressed.

Key Takeaways on Charter Parties

Charter parties are critical legal instruments in the maritime industry. They establish rights, obligations, and liabilities between parties involved in international shipping. Here are some key aspects to consider:

• Lesson: Charter parties serve as a vital framework that ensures smooth operations within the maritime sector.
• Aspects: These agreements cover various aspects, including vessel specifications, cargo details, and the duration of the charter.
• News: Staying informed about recent developments and changes in charter party regulations is crucial for all parties involved.
• Details: The terms and conditions outlined in charter parties provide specific details regarding payment terms, insurance requirements, and dispute resolution mechanisms.
• Act: Charter parties act as binding contracts that protect the interests of both shipowners and charterers.
• Fortior: By clearly defining responsibilities and obligations, these agreements fortify relationships between shipowners, charterers, and other stakeholders.

Charter parties play an instrumental role in facilitating international trade by ensuring the efficient transportation of goods across borders. As these agreements govern vital aspects of maritime operations, it is essential for all parties to familiarize themselves with their provisions. Understanding the intricacies of charter parties can help mitigate potential disputes while fostering mutually beneficial relationships within the global shipping community.

Real-world Challenges with Charter Party Disputes

Legal professionals play a crucial role in resolving charter party disputes, which can be complex and challenging. These disputes often arise from breaches of the terms outlined in the charter party agreement. Arbitration is frequently employed as an alternative to court proceedings to settle such disagreements.

The involvement of legal professionals is essential due to the intricate nature of charter party disputes . Breaches of contract terms can lead to various issues, including financial costs, risks, and responsibilities for both parties involved. Here are some examples that highlight the complexities faced in this industry:

• Maintenance Responsibility: Disagreements may arise.
• Demise Charter Issues: A demise charter involves transferring full control and possession of a vessel to another party. However, conflicts may occur regarding the condition or performance of the vessel during this arrangement.
• Country-Specific Practices: Different countries have their own regulations and practices concerning charter parties, leading to potential clashes between international parties.

Arbitration is commonly utilized to settle these disputes outside of traditional court processes. This alternative dispute resolution practice offers several advantages:

• Confidentiality: Arbitration provides a more private setting compared to court hearings.
• Expertise: Parties involved can select arbitrators with specialized maritime law knowledge or specific aspects of their cases.
• Flexibility: The arbitration process allows for tailor-made procedures that suit the unique circumstances of each dispute.

At ANHISA, we have established ourselves as trusted lawyers and counsels for shipowners and charterers involved in charter party disputes. Our extensive experience in practical cases has allowed us to successfully advise and resolve complex situations, such as indemnification requests by shipowners due to early termination breaches.

We understand the importance of finding amicable solutions that benefit all parties involved. However, when negotiations fail, our team at ANHISA is well-equipped to guide shipowners through the arbitration process, ensuring their claims are properly represented.

Our expertise goes beyond shipping knowledge; we possess the technical know-how and strategic insights required to meet our clients’ expectations. With a strong foundation in shipping practice and a track record of working with international and local clients, we are committed to providing efficient, reliable, and personalized service for all your charter party disputes.

If you require assistance in resolving any charter party dispute, do not hesitate to reach out to us for a consultation. We are here to help.

Contact us via:

• Mr. Dang Viet Anh
• Email: [email protected]
• T: +84 28 5416 5873
• M: +84 983 467070

Q1: How can ANHISA assist with charter party disputes?

At ANHISA, we offer comprehensive legal counsel and guidance throughout the process of resolving charter party disputes. From negotiation strategies to arbitration representation, we ensure that our clients’ interests are protected.

Q2: What sets ANHISA apart from other law firms?

ANHISA’s unique advantage lies in our deep-rooted expertise in shipping practice combined with years of experience working with international and local clients. Our team possesses the technical knowledge and insights necessary to navigate complex charter party disputes effectively.

Q3: Can ANHISA help with both voyage and time charter disputes?

Yes, our expertise covers both voyage and time charter disputes. Regardless of the type of charter party involved, we have the knowledge and experience to provide tailored solutions for our clients.

Q4: How long does resolving a charter party dispute typically take?

The duration of resolving a charter party dispute can vary depending on the case’s complexity and the parties’ willingness to reach a settlement. At ANHISA, we strive to expedite the process while ensuring thorough representation for our clients.

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A Layman’s Guide to Laytime, Charter party Agreement and Voyage Charter

The word “Charterer” is probably as old as the word “Ship” itself.

Do you keep hearing this word so regularly?

Well, who doesn’t?

From seafarer’s point of view, it is so much important to understand these terms.

From commercial point of view, it is the moral responsibility of the seafarers to ensure that the ship owner profits from the ship operation.

And for this reason, we must understand when and where our loyalties lies.

But sometimes it becomes difficult to get a hang of all of it.

Not anymore.

In this blog, we will discuss about the terms charterer and charter party agreement.

Concept of Charter party agreement

It is all business.

And like in all kind of business, there are at least two parties involved, one of which provide a service or product to the other for a price.

With respect to carrying the cargo onboard the ships, these two parties are,

1) Ship owner who has the ship and provide the space on the ship to carry the cargo.

2) Shipper who has the cargo and wants a ship to transport the cargo

Then where does the term charterer fits into this?

Charterer is the party that has chartered (think of simple word “hired”) the ship.

If the shipper has chartered the entire ship then shipper will also be the charterer.

In most of the cases, charterer is a kind of middle man between shipper(s) and shipowners

This is particularly the case if there are more than one shipper.

For example, if the vessel is to load 50000 tons of cargo, there could be 10 shipper, say each of them with 5000 tons of cargo.

Alone none of the shippers would want to hire the entire vessel of 50000 tons capacity for their 5000 tons of cargo.

So they contact a charterer for transporting their cargo.

The charterer’s job is to find a vessel for the cargoes they have from different shippers and maximazing the space on ship they plan to hire.

Charterers may not be the only person involved in filling the gap between shipowner and shipper.

Sometime there are some other companies or persons who help shipper, charterer and shipowner to connect with each other for a fees.

They are called “Brokers”.

So the shipper’s broker is the person or company that help shipper find a charterer for a fees called brokerage.

And charterer’s broker is the person that help charterer find a ship to hire.

The charterer may even have brokers for different purpose. For example charterer may have a broker to find a cargo for the ship they want to hire and they may have another broker to find a ship for the cargo they have in hand.

Broker or no broker, the charterer and shipowner would agree on the terms and conditions which would form “ Charter party agreement “.

Charter party agreement is a detailed document which, apart from various clauses, has informations such as

• When and where the vessel is required to be
• the freight agreed
• If the broker was used, who need to pay the brokerage fee and how much

Even though shipowners is primarily dealing with the charterer, it does not mean that the shipowner would have no relation with the shipper.

Shipper and shipowner are connected by the “carriage of cargo at sea act”, also called COGSA .

And one of the main point of it is that shipowner is required to issue bill of lading to the shipper for the cargo loaded onboard.

And with that each of the shipper have entered into an agreement with the ship owner which is called “Contract of  carriage”.

While the “charter party agreement” is a formal agreement, the contract of carriage is governed by various laws and regulations such as Hague-Visby rule .

Charter party agreement supplement the contract of carriage.

Usually you would find a mention of the charter party agreement in the bill of lading. The wording in the bill of lading could be something like this.

This shipment is carried pursuant to charter party agreement between “ Charterer’s name ” and “ Carrier’s name ” and all the terms, clauses, conditions, liberties and exceptions whatsoever contained therein are incorporated into this bill of lading.

But do the shipowners and charterers do this exercise of negotiating the format of the charter party agreement each time they do the business together.

Absolutely not. Hell, it would take a lot of time.

Instead they use pre-defined forms. These forms are developed by Independent International stakeholders such as BIMCO and INTERTANKO and are widely used in the shipping business.

There are different forms for different trades.

For example there is form  SHELLVOY 6 for use in tanker trade and then there is form AMWELSH 93 for coal dry cargo chartering.

Also if a charterer and ship owner have done the business before, they use the same charter party agreement for the future shipments too.

For this reason, many a times even for a voyage in 2019, you may find the mention of charter party dated in 2016 or even before. In the bill of lading issued even in 2019 , it may read something like,

The shipment is carried pursuant to charter party agreement between “ Charterer’s name ” and “ Carrier’s name ” dated 01 January 2016…..

Now that we understand the concept of chartering, let us understand the different ways in which the ships can be chartered.

Voyage Charter, Time charter, Demise charter

There are different ways in which a charterer can charter (Hire) the vessel.

Charterer can charter the vessel for one voyage (Voyage charter), for a particular time period (time charter) or they can hire and run the vessel as if they are the owner of the vessel (Demise or bareboat charter).

In each type of charter, charterers and shipowners have different area of responsibilities.

Each type of charter is a subject in itself. So in this blog we will explore the voyage charter.

Voyage Charter

It should be clear from the name.

Under the voyage charter, the ship is hired from the ship owner for one voyage.

One voyage could consists of multiple load ports and multiple discharge port.

The best analogy to the term voyage charter is that with hiring an Uber for a ride from one place to the other, sometimes with multiple stops in between.

So when we hire an Uber, we hire just the cab. The cab driver is still under the instructions of Uber.

Similarly, under the voyage charter, the charterer has hired the ship’s cargo space. But the Master and crew still remains under the disposal and instructions of ship owner and  ship managers.

When we hire a cab for a ride, we just pay the hire (pre-agreed or by the meter). We do not pay for or are not concerned about the fuel costs or the amount of fuel consumed.

Similarly, under the voyage charter, charterer is not concerned about the fuel consumption. The fuel costs are for the ship owners.

And when we hire an Uber, we do not pay for maintenance of the cab.

Similarly, under the voyage charter it is the ship owner who pays for the maintenance of the ship.

Whenever we have any doubt about anything under voyage charter, just think of this analogy of hiring the cab.

Most likely you will get the answer.

Laytime, Demurrage and despatch

Lord Diplock during one of the leading cases on Laytime described the voyage charter party comprising of four stages .

• Stage 1 is the loading voyage: The voyage from wherever the ship is to the loading port specified in the voyage charter party
• Stage 2 is the Loading operation: The loading of the cargo at the port of loading
• Stage 3 is the carrying voyage: The voyage from load port to the discharge port specified in the voyage charter party.
• Stage 4 is the discharging operation: The discharging of the cargo from the ship to the port of discharging as specified in the voyage charter party.

In the first and third stage, it is only the ship owner that need to perform. For example. ship owner is required to adjust the speed of the ship to arrive at the loading port within the agreed dates (Laycan).

And in the third stage, the ship owner is required to instruct the vessel to maintain the charter party speed.

However it is the second and fourth stage where most of the disputes take place.

Because in these two stages it is mutual reponsibility of the two parties to ensure that cargo loading and discharging is done without any delays.

In case of delays, each one can accuse the other for delays.

It is definately not commercially profiting for the shipowner if the voyage is extended beyond their expectations.

For example, what if the loading of the cargo took 15 days in comparison to just 2 days that shipowner had expected?

Or what if the ship could not berth at load port or discharge port for many days because of other ships ahead in line up?

Too many uncertainties.

But ship owner’s freight (and profits) cannot depend upon so many uncertainties.

So the shipowner and charterers agree on the factors like allowed number of days for loading and discharging.

In chartering terms this is called “Laydays” or “Laytime”.

The laydays is mentioned in the voyage charter party agreement between ship owner and charterer.

It could be mentioned as number of days and hours or as tons per hours or per day.

If the charterer uses more time for loading and discharging than the allowed laydays as per charter party agreement, then charterer is supposed to pay for extra time used.

The chartering term for this additional payment is “Demurrage”.

So we can say that if charterer uses more time for loading/discharging than laydays, they need to pay demurrage to the ship owner.

But if the charterer uses less time than laydays then ship owner need to pay the charterer for the time saved.

The chartering term for this is “despatch”.

Usually the agreed amount of despatch is about half of the agreed amount for demurrage.

Finally at the end of the voyage, a statement is made to shows the time saved and/or extra time taken at different ports.

Below is the simplified version of the laytime summary calculated at the end of the voyage.

This statement would also show the final amount due and to whom it is due. Means if the final amount is demurrage or despatch and how much.

Notice of readiness and statement of facts

For calculation of laytime, it is important to know when the laytime counting and calculation would start.

This information is also provided in the charter party agreement.

In most of the cases, the laytime would commence to start when the vessel has arrived at the port. In chartering term, this is called “ Arrived Ship “.

Legally, a ship is considered as an ‘Arrived Ship” only when

• Ship has arrived at the port of loading or discharging (port voyage charter) or at the designated berth (Berth Voyage charter).
• Ship is ready in all respects to commence loading (or discharging) or the cargo, and
• Master has sent the notice of readiness to the all parties concerned

The charter party agreement contains the information if the voyage charter is a port voyage charter or a berth voyage charter.

Irrespective if it is port or berth voyage charter, from the ship’s point of view it is important that the master of the vessel send the notice of readiness.

Notice of readiness need to  state that the vessel has arrived and she is ready in all respect to commence loading (or discharging ) of the cargo.

The laytime would start to commence at this time or sometimes few hours later if specifically mentioned in the charter party agreement.

Since one of the condition for the laytime to start is for the master to send the notice of readiness, it makes it so much of an important aspect.

Statement of Facts

The vessel and the master of the ship are the owner’s representative at the action site (loading port or discharging port).

Ship Owner would know only know the information that we provide them. They would use this information for calculation of any demurrage due to the charterers.

But for the correct demurrage calculation, the information we provide must be correct and we must not miss any important information such as any delays.

That make the statement of facts (commonly called SOF) an important document.

At the least, statement of facts must include

• any delays from shore side or from ship’s side and reason of delay
• any delays because of weather conditions
• Timings for the movement of the ship (such as times for anchoring, anchor aweigh, pilot onboard, NOR Tendered etc)
• Timings related to cargo operations (Commenced cargo operation and completed cargo operation

Master’s actions during voyage charter

Master and ship staff may not see the actual charter party agreement between the charterer and the ship owner.

And it is for their own benefit too.

Because there would be so many things in that which we seafarers are not concerned about.

But when the  ship is fixed for the voyage charter, master will receive “Voyage instructions” from the charterer through the ship owner’s commercial team.

The voyage instructions contains the information from the charter party agreement that requires master’s attenstion and subsequent actions.

Master must not miss the points in the voyage orders that requires his actions.

One of the way to do it is to highlight the text of the voyage instructions that require his attention for easy follow up.

Once Master reads the voyage instructions, he may come across insufficient information that need more information or clarification.

Like this one in one of the voyage orders.

Clarification must be sought from the ship operator for any of such information in the voyage orders.

After all it just takes a simple email to get everything in place.

And once everything is clear and in place, it is just about following that.

There are may be only a handful of shipowners that do not rely on the charterer to find the cargo for their vessel.

Having the vessel on charter is so common.

And vessel can be chartered in different ways. Vessel can be on a voyage charter, time charter or demise/bareboat charter.

With respect to voyage charter, master and ship staff must understand few thing

First, when is the laycan for the vessel. This is period in which vessel must arrive at the load port.

If master thinks that vessel may not be able to make it to the loadport in laycan period, the commercial operator must be informed who can then try to extend the laycan.

Second, when the notice of readiness need to be tendered.

If the voyage charter is a port charter, NOR can only be tendered when vessel is at least within the port limits. Usually in this case NOR is tendered when pilot boards the vessel.

If the voyage charter is berth charter, the NOR can only be tendered when the vessel is alongside the designated berth.

Wrong tendering of NOR can make the Notice of readiness null and void and shipowner may loose tons of money.

Lastly, the ship staff need to be make sure that a correct record of statement of facts is kept. This is the document that is used for laytime calculations .

If the charterer uses more time than agreed for loading or discharging the cargo, the ship owner is supposed to get a pre-agreed compensation called demurrage.

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About Capt Rajeev Jassal

Capt. Rajeev Jassal has sailed for over 24 years mainly on crude oil, product and chemical tankers. He holds MBA in shipping & Logistics degree from London. He has done extensive research on quantitatively measuring Safety culture onboard and safety climate ashore which he believes is the most important element for safer shipping.

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70 comments.

How i wish that our exam books were written so precisely yet so easy to understand .Thanx for all the pain you take .No amount of words would do justice to match the level of you efforts.

Thanks Alok...The readers liking it make all the hardwork worthwhile...

its amazing how you describe anything sir

what if the vessel is about to tender NOR and shipper cancels the order. what would be the penalty

Great article to understand the business with ease as an ASM candidate

Many thanks for writing such articles with such an ease of understanding sir...

Glad you liked it Sukhchain...

Another good read. Thank you for taking time to write articles. All Seafarers must understand the commercial aspects of ships. All the best and I cant wait to read the next one.

Glad you liked it Marlon...

what if the ship could not berth at load port or discharge port for many days because of other ships ahead in line up?Too many uncertainties.But ship owner’s freight (and profits) cannot depend upon so many uncertainties.So the shipowner and charterers agree on the factors like allowed number of days for loading and discharging.In chartering terms this is called “Laydays” or “Laytime” ??? Laydays refer to the time when a ship must present itself to the charter.If the vessel arrives after the laydays ,than contract can be cancelled. -Laycan. Laytime is the amount of time allowed (in hours and days)in a voyage charter for the loading and unloading of cargo.

Thanks for your input Zibi...

Laydays or "Laycan "I think is the correct term not Laytime. :)

Thanks for such simplified explanations. Sir could you please tell the few famous ship brokers names in india and worldwide.

Interocean is one of them...

Thank Captain for simple & detailed explanation. Information is really worthy .

Glad you found it useful Sajjad...

Thanks Capt. Rajeev for this good information in simple way.

Glad you liked it Dharmdeep...

Very well written capt., pls continue the good work

Thanks Capt Pereira...

This is a scholarly article Great job Captain!

Glad you liked it Tunde...

Good job, Capt. Jassal! These mandatory intricacies of ship's business & chartering are excellently presented. Organized and laid out as you have, this blog subject does a great service to anyone who longs to learn more about it & be more familiar with the clauses, details & positions (which is probably everyone, right?) -- including this marine cargo surveyor!

Glad you liked it Capt Edward...

Many thanks

Thanks Rafik...

sir plz explain magnetic compass

I will do that in a different blog...

Once again thank you very much.

Thanks Raju...

Informative Awaiting next one regarding time charterers

Will write on Time chartering too...

many thanks for this jobs cap

How easy way for explain this matter ,really very good job captain I appreciate your good effort waiting more and more

Thanks Ahmed...

sir waiting for your blog on purging and gas freeing cargo tanks

Very nicely explained and written good effort

Very nice explanation capt,

Generally the CP agreement is never sent to ship..and hence for tendering NOR what criteria(LOCATION) shall be followed as Master will not be aware if the C/P is voyage or Port C/P .These days Master tender NOR on arrival and then they keep re tendering every 24 hrs or at important events like POB, or All Fast.What is the logic behind following this and how we can ensure the NOR tendering doesn't becomes null and void. really APPRECIATE YOUR GREAT EFFORTS

if the vessel arrived at the agreed laycan and gave a valid NOR tendered and waited for almost 5 days before berthing, then while berthing the vessel had an accident and the owner requsted a new laycan, the question here is, does cancelling the old laycan result in canceling the demurrage fees caused by it?

When a vessel suffers breakdown typically NOR becomes invalid as the vessel was not in all respects ready to load her cargo.

U don't see such priceless articles often.. Good work cap. Let's make the world a better place to sail????????

To the writer of this blog- what made you write this? IT IS FANTASTIC. Well done. Also your MBA, was it the distant learning one from Middlesex?

On the Laytime Summary calculation, wouldn't it be correct to say that on the loading it was lost 0d-12h-24 min instead of 1d-00-24m?

Captain sahab, if I ever get a chance, I'll surely shake hand and say thank you, for all your efforts in simplifying the topics

can you advise for the following : in case a vessel is on Voyage Charter, and during loading or discharging alongside berth, there is a rainy period, so the daytime for this period should be NOT TO COUNT, correct??? cause there is the terms "weather permitting".

Great article sir......waiting for more.....

Hi. How does the shipbroker locate a suitable ship to transport the cargo?

Good day! You have mentioned different stages of voyage charter. May I ask what are the different stages of Time Charter and Bareboat Charter? Thank you in advance.

Nice blog...pleasure to read

I love your write up. Please, keep exposing our mind to the rudiments of shipping business.

Sir, in voyage charter party at what time and place charter party agreement will start? After ship arriving on laycan days or after giving notice of readiness? And notice readiness when we can give? Is there any specific time only we can give NOR?

I have a question, How to calculate the freight for a Multiport voyage. for example, there is a Cargo loaded from the country (C) and need to discharge its half portion in other countries multiple ports (A) & (B). For single port discharge, the cost is 8$ in port A and in Port B 11$, but the agent says he could fulfill this in 10$ for both ports. Now my question is how is he calculating the freight 10$ for Multiple port ?

Thank you sir for this great effort helping a lot for phase2 law preparation

Hi Sir! I am so pleased to have found your blog, it is absolutely helpful. if it is not too much to ask, do you have a quote sample for time and voyage charter? and the stardard terms and conditions? sorry if I am asking too much. thank you

Excellent blog about chartering service. This blog cleared my doubt about chartering service for ship

could you please advise that how long a shipowner should wait cargo to load on board (if cargo not ready) and no any specific clause written on voyage cp

Hi, Capt Jassal, I find every write up on any marine subject is excellent and easy to understand for students. I highly appreciate the contents of your blog. Regards Capt MK Srivastava , Ex-DPA, The SCI Ltd.

Wonderfully explained

While the blockchains themselves are secure, the applications running on the blockchain may not be. These applications interact with the blockchain through smart contracts, but just like any other software, bugs in the code can lead to security vulnerabilities. For this, we need to involve the auditors who conduct security audits on the smart contract. Smart Contract Audit helps you find hidden exploits and eventually reduce the risk and provide you an extra layer of security. Bug-free code is nice to have in other types of software, in blockchain applications, it is essential.

Dear Capt Rajeev Jassal, with interest i have seen your blog however the title struck me a bit - A Layman's Guide to Laytime - this sounds very familiar, if not accurate, with the dissertation i wrote for the ICS, Institute of Charterers Shipbrokers London, who hold copyright on this. Kindly amend the title of your blog to avoid confusion in the industry as to whom the readers take their information from. With best regards, Erwin de Zwarte, FICS

sir will you pls write on paramount clause , new jasson clause , cesser clause and both to blame collision clause

Such a great explanation! Thank you so much!

This article is a big help for those individuals that are trying to expound their knowledge in shipping. I much appreciated because at present i am taking my master's degree in ship management. Thank you...

Wow, so clearly written that I didn't have to read it twice to understand! Why don't our text books/ Oral notes be like this?! Thank you so much Capt. Jassal.

It’s a great and useful piece of info. I’m happy that you just shared this useful info with us. Please stay informed like this. Thank you for sharing. Here’s another informative content on Common Law Separation Agreement , may find more details here.

thanks alot of info keren bgt

Sir u r the best , undoubtedly . The confidence which i gain every time when ever I read your blog is just unspeakable and it sharpens my knowledge every single time. A teacher like you is what this shipping industry needs and I am glad to find the perfect one . Every time when ever I am in doubt I refer to your blogs and it works miracle .....thanks a ton to you sir .....simply great.

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Voyage Charter : Definition & Full Guide

• By MascotMaritime
• April 22, 2022
• 3 mins read

Table of Contents

What is a voyage charter.

Voyage charter definition : The voyage charter is a contract (voyage charter party) between the shipowner and the charterer wherein the shipowner agrees to transport a given quantity of a shipment, using a pre-nominated vessel for a single voyage from a nominated port (say X) to a nominated port (say Y), within a given time period.

Who is a voyage charterer? What is the freight & voyage charter party? 

The person who charters the vessel is called the voyage charterer , the payment is called freight & the contract is called the voyage charter party. The freight rate is calculated as $/tonne of shipment. 

What is the most significant part of a voyage charter party?

The most significant parts are the description of the voyage, size & capacity of the vessel, cargo, the allocation of duties and costs in connection with loading and discharging, the specification of the freight, and the payment of the freight, the laytime rules, the allocation of the liability for the cargo and the allocation of other costs and risks.

Depending on the circumstances, other questions and clauses can be very important in the negotiations between the owners and the charterers.

In this type of charter, the vessel must be in the position that the owner specified when the charter was concluded & the vessel must, without undue delay, be directed to the port of loading.

At the port of loading, the charterer must deliver the agreed cargo. 

The cargo must not be dangerous cargo unless otherwise agreed. The cargo must be brought alongside the ship at the loading port & must be collected from the ship side at the port of discharge.

Mainly with the bulk cargoes, the charterer often undertakes to pay to load and discharge & often clauses of f.i.o or f.o.b are met. Very often parties agree on f.i.o.s or f.i.o.s.t terms.

In voyage charter, the discharge port need not be nominated in the charter party & in such cases, the charterer must have the right later to direct the vessel within a certain range to a specific port of discharge.

In a voyage charter where the charterer carries out loading &(or) discharging, it is generally agreed that the charterer will have a certain period of time at his disposal for loading & discharging of the vessel & it is called laytime .

If the charterer fails to load and(or) discharge the cargo from the vessel within the laytime, then he has to pay compensation for the extra time used called demurrage . Once in demurrage always in demurrage.

In other cases, if the charterer loads &(or) discharges the cargo from the vessel more quickly than the agreed laytime time, then he is entitled to claim compensation (only if agreed earlier) called despatch money.

In voyage charter, unless lumpsum freight is paid, the owner may claim freight compensation if less cargo is delivered, or cargo is delivered in such a way that ship’s capacity cannot be utilized due to broken stowage . This freight compensation is called deadfreight .

Voyage charter party agreement example:

Click here to see the example of a voyage charter party (NORGRAIN 73).

What are the factors which influence the freight rate in a voyage charter market?

In the voyage charter market, rates are influenced by cargo the charterer must deliver the agreed cargo size, commodity, port dues, and canal transit fees, as well as delivery and redelivery regions.

In general, a larger cargo size is quoted at a lower rate per tonne than a smaller cargo size. Routes with costly ports or canals generally command higher rates than routes with low port dues and no canals to transit.

Voyages with a load port within a region that includes ports where vessels usually discharge cargo or a discharge port within a region with ports where vessels load cargo also are generally quoted at lower rates because such voyages generally increase vessel utilization by reducing the unloaded portion (or ballast leg) that is included in the calculation of the return charter to a loading area.

What are the costs paid by the shipowner & charterer in a voyage charter?

In a voyage charter, the shipowner retains the operational control of the vessel and pays all the operating costs (crew, fuel, freshwater, lubes, port charges, extra insurances, taxes, etc.), with the possible exclusion of the loading/unloading expenses. 

The charterer’s costs are usually costs & charges relating to the cargo.

What are the types of voyage charter?

It can be of the following types:

• Immediate  –  which is carried out within weeks of the contract agreement and the agreed freight rate is called the spot rate.
• Forward –  which is scheduled & fulfilled at the agreed time in the future, for example in say three months.
• Consecutive – which refers to several same consecutive voyages.

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Charter Party Agreements

Img is one of the only law firms in the pacific northwest that focuses on both the transactional side and the litigation side of charter party agreements..

Different charter parties impose different obligations, exclusions, and limitations between each entity. For this reason, both shipowners and charterers should consider seeking sound and practical legal advice before drafting, amending or complementing any time charter, voyage charter, or bareboat charter party. During a contentious charter party dispute, shipowners and charterers should be especially aware of their legal exposures and contractual liabilities.

With experience in bareboat, time and voyage charters, contracts of affreightment and slot charters, dry bulk and containerized cargoes, oil, gas and products, IMG regularly acts on behalf of the region’s largest shipowners and charterers. Indeed, our expertise in transactional and contentious charter party matters gives us an invaluable perspective – we can foresee the problems that might arise and take steps to avoid them. Need help understanding your legal rights in a charter party contract? IMG can help.

or call   (206) 707-8338 to speak to a legal expert.

Bareboat Charters – What you need to know

Strapped for capital but want to expand your fishing fleet?  Bareboat charters can be a great financial alternative, provided you understand your liability.  

Frequent Charters We Advise Upon

Time Charters

Time chartering is a complex business. The shipowners give the time charterers substantial control over the commercial operation of the vessel in exchange for the regular payment of hire. While this arrangement suggests that the shipowners have transferred much of the potential operational risk to the charterers and that the charterers can do more or less what they like with the ship, such an initial impression on behalf of the time charterer is both deceptive and dangerous.

If you would like clarification of your rights and liabilities as either a time charterer or a shipowner, IMG can help.

Voyage Charters

Voyage charters are the most commonly used charter party agreement. Under a voyage charter, a ship owner and a charterer enter into a contract whereby the vessel will carry cargo between two points. The voyage can be a single trip or multiple trips, provided that the charterer has absolutely no operational control over the vessel while it is being operated. Any delays during the loading and unloading of the cargo, as well as any delays during the seagoing part of a voyage, generally fall onto the vessel owner. Many charterers prefer this allocation of risk.

Bareboat Charters

A bareboat charter is the simplest type of charter party agreement. Under a bareboat charter (a.k.a. “demise charter”), the charterer effectively becomes the owner of the vessel for all operational and trading purposes, and thus, is responsible for the navigation, operation, repair, maintenance, insurance, and crew of the vessel.

Despite an appearance of simplicity, bareboat charters are complex agreements, and numerous problems can arise during their use. Owners and charterers should seek sound legal advice before drafting or amending a bareboat charter.

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Sea Law Central

Understanding charterparties: a guide to maritime law contracts.

Maritime law contracts, also known as charterparties, form the backbone of the shipping industry. These legal agreements regulate the use and hire of vessels for the transportation of goods or passengers. Understanding charterparties is crucial for anyone involved in maritime operations, from shipowners and charterers to cargo owners and insurers. In this comprehensive guide to charterparties and maritime law contracts, we will dive into the key elements, types, legal aspects, and practical applications of charterparties. By the end, you’ll have a solid understanding of the complexities and obligations associated with these contracts.

Table of Contents

Key Elements of Charterparties

Charterparties comprise several key elements that define the rights and obligations of the contracting parties. These elements include the identity of the vessel, duration of the charter, freight considerations, and terms of delivery and redelivery. Each element plays a crucial role in the overall agreement and must be carefully negotiated and agreed upon by both parties.

Identity of the Vessel

The identity of the vessel is one of the fundamental aspects of a charterparty. It includes details such as the vessel’s name, type, and specifications. The charterer must ensure that the vessel meets their requirements in terms of size, capacity, and equipment. The shipowner, on the other hand, must provide an adequately maintained and seaworthy vessel for the agreed duration.

Duration of the Charter

The duration of the charter is another essential element to consider. Charterparties can be classified into two main types based on the duration: time charters and voyage charters. A time charter allows the charterer to hire the vessel for a specified period, while a voyage charter is for a particular journey or series of voyages between specific ports.

Freight Considerations

Freight considerations in charterparties determine the financial aspect of the agreement. The freight, which is the payment for the transportation of goods or passengers, can be fixed, meaning a predetermined amount, or based on a market rate such as a lump sum or a per-ton rate. The parties must agree on the freight terms and ensure that they are commercially viable for both sides.

Terms of Delivery and Redelivery

The terms of delivery and redelivery outline the responsibilities and conditions for handing over the vessel to the charterer at the start of the charter and returning it to the shipowner at the end. These terms cover aspects such as the location and time for delivery and redelivery, the vessel’s condition, and any required inspections or surveys. It is crucial to establish clear and precise terms to avoid disputes or misunderstandings later on.

Types of Charterparties

Charterparties come in various forms to accommodate the diverse needs and arrangements of the shipping industry. Understanding the different types of charterparties can help parties select the most suitable agreement for their specific requirements. The main types of charterparties include time charters, voyage charters, bareboat charters, and contracts of affreightment.

Time Charters

Time charters are one of the most common types of charterparties. In a time charter, the shipowner leases the vessel to the charterer for a specific period, usually several months to several years. The charterer pays hire to the shipowner and has more control over the vessel’s operations during the charter period.

Voyage Charters

Voyage charters, as the name suggests, involve the transportation of goods or passengers on a specific journey or series of voyages. In a voyage charter, the shipowner agrees to transport the cargo or passengers from one port to another for an agreed-upon freight rate.

Bareboat Charters

Bareboat charters, also known as demise charters, differ from the previous types as the shipowner gives full control and possession of the vessel to the charterer. The charterer operates the vessel as if they were the owner for the duration of the charter. In this arrangement, the charterer is responsible for all the operating expenses, maintenance, and crewing.

Contracts of Affreightment

Contracts of affreightment are commonly used when there is a demand for regular shipments of goods between two parties. Instead of chartering a specific vessel for each shipment, a contract of affreightment establishes the terms and conditions for multiple shipments over a defined period. This type of charterparty offers flexibility to the charterer while ensuring a steady flow of cargoes for the shipowner.

Legal Aspects of Charterparties

Understanding the legal aspects of charterparties is crucial to ensure compliance, enforceability, and risk management. Various laws and regulations govern charterparties, and parties must pay attention to the contractual terms, jurisdiction, arbitration, and liability provisions within the agreement.

Contractual Terms in Charterparties

Charterparties contain numerous contractual terms that outline the rights, obligations, and responsibilities of both parties involved. These terms cover areas such as hire payments, maintenance and repairs, breach of contract, insurance requirements, and dispute resolution mechanisms.

Charterparty Disputes and Arbitration

Charterparty disputes are not uncommon in the shipping industry, often revolving around issues like non-payment, off-hire periods, delays, or cargo damage. To address these disputes efficiently, charterparties often include arbitration clauses that dictate the preferred method of resolving conflicts. Arbitration provides a neutral and specialized forum to handle complex maritime disputes, avoiding lengthy and costly court procedures.

Liability in Maritime Contracts

Liability is a significant aspect of charterparties and maritime contracts in general. The contract must clearly define the liabilities and responsibilities of each party, including for damage or loss of cargo, personal injuries, pollution incidents, and any other potential risks. Parties often rely on additional clauses, such as “Himalaya clauses,” to extend protection and indemnity obligations beyond the shipowner to those providing services related to the vessel.

Charterparties and Vessel Operations

Charterparties have a direct impact on vessel operations, and an in-depth understanding of these agreements is essential for the smooth and efficient running of maritime operations. The contractual terms, commercial considerations, and legal obligations outlined in charterparties influence various aspects of vessel management, including voyage planning, cargo handling, crewing, and safety.

In conclusion, charterparties are crucial maritime law contracts that establish the terms and conditions for the use and hire of vessels. They encompass key elements such as the vessel’s identity, duration of the charter, freight considerations, and delivery and redelivery terms. Understanding the different types of charterparties, including time charters, voyage charters, bareboat charters, and contracts of affreightment, allows parties to select the most suitable agreement for their needs. Additionally, comprehending the legal aspects of charterparties, including contractual terms, dispute resolution, and liability provisions, ensures compliance, enforces rights, and manages risks effectively. Charterparties significantly influence vessel operations, and a solid grasp of these agreements is essential for the successful and smooth functioning of the shipping industry.

Frequently Asked Questions

What is a charterparty? A charterparty is a contract in maritime law that outlines the terms and conditions of leasing or hiring a vessel for a specific period or voyage. What are the key elements of a charterparty? The key elements of a charterparty include the names of the parties involved, vessel details, duration of the charter, freight costs, cargo type, payment terms, rights, and obligations of each party. What are the different types of charterparties? Some common types of charterparties include time charters, voyage charters, bareboat charters, and contracts of affreightment. Each type has specific terms and conditions tailored to the nature of the agreement. What are the legal obligations in a charterparty? The legal obligations in a charterparty involve the shipowner providing a seaworthy vessel, the charterer paying the agreed charter hire, both parties complying with applicable laws, and fulfilling the terms outlined in the contract. What are the contractual terms in charterparties? Contractual terms in charterparties include laytime (time for loading/unloading), demurrage (additional time cost), freight rates, insurance requirements, payment terms, and clauses related to breaches, liabilities, and disputes. How are charterparty disputes resolved? Charterparty disputes are typically resolved through arbitration. This is a private method of dispute resolution where an impartial third-party arbitrator or panel is chosen to make a binding decision based on the evidence presented by both parties. What is the liability in maritime contracts? Liability in maritime contracts can vary depending on the terms of the charterparty. Generally, the shipowner is responsible for the vessel’s seaworthiness, while the charterer is liable for cargo damage caused by improper loading or unloading. How do charterparties affect vessel operations? Charterparties play a crucial role in vessel operations by providing a framework for the rights and responsibilities of shipowners and charterers. They outline voyage details, cargo handling, and various operational aspects to ensure smooth and efficient maritime transportation. What are the legal aspects one must understand in charterparties? Important legal aspects to understand in charterparties include the jurisdiction governing the contract, waiver of certain rights, limitations of liability, insurance requirements, and the choice of dispute resolution mechanisms. How can one navigate and understand charterparties effectively? To understand charterparties, it is essential to study the key contractual terms, seek legal advice if needed, familiarize oneself with relevant maritime laws, and review industry-specific resources. Practical experience and continuous learning about maritime law contracts can enhance understanding.

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Voyage Charter Parties

Voyage Charter Parties and Contracts of Affreightment: Under a voyage charter party, the shipowner undertakes to provide a ship for the carriage of specified goods for a voyage between named ports or between a range of named ports. The shipowner remains responsible for the operating expenses of the ship (crewing, stores, lubricants, repairs and maintenance, insurance, etc.) as well as the voyage expenses (fuel, port dues, pilotage, canal dues, etc.).

The cargo-handling expenses may fall upon the shipowner or the charterer, depending on the terms of the charter party. Usually this cost is undertaken by the charterer (hence the terms free-in out trimmed, or FIOT and free-in out stowed, or FIOS in the charter party contract). The shipowner is remunerated by way of freight paid on the quantity of cargo carried or paid on a lump-sum basis. The freight rate must take into account the expected length of the voyage, the type of cargo to be carried (the commodity), etc. In the event of a ship being delayed in port in excess of an agreed period of time (laytime), liquidated damages (demurrage) are paid to the shipowner. When the ship leaves the port before the laytime has expired, the shipowner is usually required to pay money (dispatch) to the charterer.

Under a consecutive voyage charter party, the ship is chartered for a series of voyages, for a stipulated number of voyages, or for as many voyages as can be completed in a given period of time. Each voyage is considered separately when calculating demurrage and dispatch.

A contract of affreightment is used when a shipper wishes to transport a given quantity (usually a very large quantity) of cargo over a given period of time. The contract is usually tailor-made to meet the charterer’s requirements (although there are standard form contracts of affreightment), with the shipowner being able to use his or her own or chartered ships to perform the terms of the contract. A contract of affreightment is similar in many respects to a voyage charter party.

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FREE 10+ Charter Agreement Samples In MS Word | Google Docs | Apple Pages | PDF

Embarking on a journey or project often requires a well-defined framework, and that’s where a Charter Agreement becomes pivotal. This document, essential in both business and personal realms, outlines the terms conditions , and mutual expectations for parties involved in a venture. Whether it’s for leasing a yacht, initiating a corporate project, or any collaborative endeavor, a Charter Agreement ensures clarity and legal safeguarding. Our guide delves into the nuances of crafting a robust and effective Charter Agreement, tailored for diverse needs and scenarios.

Charter Agreement

Free 26+ investment agreement samples in pdf | ms word | google docs | pages, free 9+ shop rental agreement samples [ commercial, lease, tenancy ], free 13+ teacher agreement contract samples in ms word | pdf, 10+ charter agreement samples, 1. sample yacht charter agreement template.

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2. Sample Aircraft Charter Agreement Template

3. Sample Boat Charter Agreement Template

4. Sample Charter Party Agreement Template

5. Sample Team Charter Agreement Template

What is a Charter Agreement?

A charter agreement, commonly found in the shipping and aviation industries, is a sample contract where one party, the charterer, rents a ship, aircraft, or other modes of transportation from its owner. The agreement outlines the terms under which the charterer can use the vessel or vehicle, including duration, payment, and specific conditions of use. There are different types of charter agreements, such as bareboat charters, where the charterer is responsible for operating the vessel, and time charters, where the vessel is hired for a specific period. These agreements are essential for businesses that require transportation resources but do not wish to own them outright.

Understanding the Basics of Charter Agreements

Charter agreements are not one-size-fits-all; they vary based on the type of charter and the specific requirements of the parties involved. You can also see more templates like Team Charter Samples. Generally, these agreements cover several key aspects:

• Duration and Type of Charter : The agreement specifies whether it’s a time charter, voyage charter, or bareboat charter. Each type has distinct characteristics and applications.
• Financial Terms : This includes the charter fee, payment schedule , and any other financial obligations like fuel costs, port charges, and crew salaries.
• Operational Control : The agreement defines who has operational control over the vessel or vehicle, which can significantly vary between different types of charters.
• Liabilities and Insurance : It outlines the responsibilities of each party in case of damage or loss and details the insurance requirements.
• Maintenance and Repairs : Particularly in long-term charters, the agreement must address maintenance responsibilities and procedures.

Importance of Charter Agreements

Charter agreements play a crucial role in the transportation sector, particularly in maritime, aviation, and freight industries. These sample contracts are not just formalities; they are fundamental in defining the relationship between the owner of a vessel or vehicle and the charterer. The significance of these agreements can be understood through various aspects:

Facilitating International Trade and Commerce

• Global Connectivity : Charter agreements enable the movement of goods and people across international borders, fostering global trade and connectivity.
• Economic Efficiency : By allowing companies to charter vessels or aircraft, these agreement format provide a cost-effective way to transport goods without the need for owning and maintaining a fleet.

Risk Management and Legal Protection

• Clear Liability Definitions : These agreements delineate responsibilities and liabilities, ensuring both parties are aware of their obligations and rights.
• Dispute Avoidance and Resolution : By clearly stating terms and conditions, charter agreements reduce the potential for disputes and provide mechanisms for resolution if disagreements arise.

Operational Flexibility and Efficiency

• Adaptability to Market Needs : Charter agreements offer flexibility, allowing companies to scale their operations up or down based on market demands without significant capital investment.
• Specialized Services : They enable charterers to access specialized vessels or aircraft suited for specific types of cargo or routes, enhancing operational efficiency. You can also see more templates like  Project Charter Samples.

Ensuring Safety and Compliance

• Safety Standards : These agreements often include clauses that ensure the vessel or aircraft meets safety and environmental standards, safeguarding crew, cargo, and the environment.
• Regulatory Compliance : Charter agreements must comply with international and local laws, ensuring that both parties adhere to regulatory requirements.

Financial Implications

• Cost Management : They allow for better financial planning and plan of cost management , as chartering costs are often more predictable than the variable costs of owning and operating a fleet.
• Revenue Generation for Owners : For owners, charter agreements provide a steady stream of income and a way to maximize the utilization of their assets.

Types of Charter Agreements

• Time Charter : In a time charter, the charterer rents the vessel for a specific period. The owner provides the crew and is responsible for operating and maintaining the vessel.
• Voyage Charter : Here, the charterer hires the vessel for a single voyage. The owner is responsible for the vessel’s operation, but the charterer typically pays for the voyage costs.
• Bareboat Charter : Also known as a “demise charter,” in this arrangement, the charterer has full control of the vessel, including its operation and maintenance, for the duration of the charter. You can also see more templates like  Teacher Agreement Contracts .

Key Considerations in Charter Agreements

• Legal Compliance : Both parties must ensure that the charter agreement complies with relevant laws and regulations.
• Risk Management : Identifying and managing risks, including safety, environmental, and operational risks, is crucial.
• Dispute Resolution : The agreement should have clear mechanisms for resolving disputes, including arbitration or legal proceedings.
• Termination Clauses : Conditions under which the charter can be terminated must be clearly outlined to protect both parties.

What Information is Required on Charter Agreement?

A charter agreement, an essential contract in the shipping, aviation, and transportation industries, must contain specific information to ensure clarity, legality, and operational efficiency. You can also see more templates like Contract Agreement Formats . Here is a detailed breakdown of the necessary information:

1. Identification of Parties

• Owner’s Details : Name, contact information, and legal status of the vessel or vehicle owner.
• Charterer’s Details : Name, contact information, and legal status of the entity chartering the vessel or vehicle.

2. Description of the Vessel or Vehicle

• Type and Name : Specific type (e.g., cargo ship, tanker, aircraft) and name of the vessel or vehicle.
• Physical Characteristics : Size, capacity, tonnage, age, and any relevant technical specifications.
• Registration and Compliance : Registration details and compliance with safety and environmental standards.

3. Type of Charter

• Clearly state whether it is a time charter, voyage charter, or bareboat charter.

4. Charter Period

• For Time Charter : Specific start and end dates.
• For Voyage Charter : Details of the voyage, including loading and discharge ports.

5. Financial Terms

• Charter Rate : The agreed-upon rate, including how it is calculated (e.g., per day, per voyage).
• Payment Schedule : Terms of payment, including advance payments, installments, and final settlements.
• Additional Costs : Details on who bears additional costs like fuel, port charges, and insurance.

6. Operational Control and Responsibilities

• Crew Management : Who is responsible for providing and managing the crew.
• Maintenance and Repairs : Responsibilities for maintaining and repairing the vessel or vehicle.
• Operational Authority : Clarification on who has operational control, especially in bareboat charters.

7. Insurance and Liability

• Insurance Requirements : Types and amounts of insurance required, and who is responsible for obtaining it.
• Liability Clauses : Allocation of liabilities in case of damage, loss, or accidents.

8. Compliance with Laws and Regulations

• Ensure adherence to international and local laws, including environmental, safety, and maritime or aviation regulations.

9. Dispute Resolution Mechanism

• Specify how disputes will be resolved, whether through arbitration, mediation, or legal proceedings.

10. Termination Clauses

• Conditions under which either party can terminate the agreement and the consequences of such termination.

11. Signatures

• Legal signatures of authorized representatives from both the owner and the charterer. You can also see more templates like  Basic Agreement  Templates.

6. Sample Chapter Charter Agreement Template

Size: 92 KB

7. Sample Passenger Charter Agreement Template

Size: 323 KB

8. Sample Community Charter Agreement Template

Size: 80 KB

9. Sample Trolley Charter Agreement Template

Size: 109 KB

10. Sample Skippered Charter Agreement Template

Size: 110 KB

11. Sample Charter School Agreement Template

Size: 347 KB

How to Create a Charter Agreement?

Creating a charter agreement, a vital document in the shipping, aviation, and transportation industries, involves several key steps. This process ensures that all necessary details are covered, providing a clear and legally binding contract between the vessel or vehicle owner and the charterer. Here’s a step-by-step guide:

1. Identify the Type of Charter

First, determine the type of charter agreement needed:

• Time Charter : Renting the vessel for a specific time period.
• Voyage Charter : Hiring the vessel for a single voyage.
• Bareboat Charter : Charterer has full control over the vessel for the charter duration.

2. Gather Necessary Information

Collect all relevant information, including:

• Details of the vessel or vehicle (name, size, capacity).
• Information about the owner and charterer.
• Duration of the charter or specifics of the voyage.
• Financial terms, including charter rates and payment schedules.

3. Draft the Agreement

Create a draft of the agreement, ensuring it includes:

• Parties Involved : Clearly identify the owner and the charterer.
• Description of the Vessel/Vehicle : Include specifics like type, size, and capacity.
• Charter Period : Specify the duration or the details of the voyage.
• Financial Terms : State the charter fee, payment terms, and other financial obligations.
• Operational Control : Define who is responsible for operations, maintenance, and crew management.
• Liabilities and Insurance : Outline responsibilities for damages, losses, and insurance requirements.
• Compliance and Safety : Ensure clauses for adherence to safety standards and regulatory compliance.
• Dispute Resolution : Include terms for handling disputes, possibly through arbitration or legal proceedings.
• Termination Clauses : Detail conditions under which the charter can be terminated. You can also see more templates like  Charter Samples .

4. Review Legal Compliance

Ensure that the agreement complies with relevant laws and regulations. It’s advisable to consult legal experts specializing in maritime, aviation, or transportation law.

5. Negotiation and Amendments

Discuss the draft with the other party. Be open to negotiations and make amendments as agreed upon by both parties.

6. Finalize and Sign the Agreement

Once both parties agree on the terms, finalize the document. Ensure that it is signed by authorized representatives of both the owner and the charterer.

7. Keep Records and Manage Compliance

Maintain a signed copy of the agreement for record-keeping. Throughout the charter period, manage operations in compliance with the agreement’s terms.

What is the Purpose of the Charter Party Agreement?

A charter party agreement, often simply referred to as a charter agreement, is a critical document in the shipping industry. This contract serves several key purposes, each of which is essential for the smooth operation of maritime trade and transportation.

Who Bears the Operational Costs in a Charter Agreement?

This depends on the type of charter:

• In a time charter, the owner typically covers operational and maintenance costs.
• In a voyage charter, the charterer usually pays for the voyage costs.
• In a bareboat charter, the charterer bears all operational and maintenance costs.

Are Charter Agreements Legally Binding?

Yes, charter agreements are legally binding contracts, enforceable under the relevant jurisdiction’s laws.

How are Charter Rates Determined?

Charter rates are influenced by various factors, including the type of charter, market demand, vessel size and type, duration of the charter, and prevailing market conditions.

In conclusin, Charter agreements are essential in the transportation industry, providing a framework for the temporary transfer of a vessel or vehicle from its owner to a charterer. These agreements must be carefully crafted to ensure clarity, legal compliance, and protection for both parties involved. Understanding the nuances of different types of charters and the key elements of these agreements is crucial for successful and mutually beneficial arrangements. You can also see more templates like  Charter Document Samples.

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50+ SAMPLE Charter Agreement in PDF

Charter Agreement

50+ sample charter agreement, what is a charter agreement, what’s in a charter agreement, how to create a charter agreement, when is this document usually needed, what is a voyage charter, what is a bareboat charter.

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Our 20 Best Moscow Tours of 2022

Join us on an unforgettable tour to Moscow, the capital of Russia. Imagine visiting Red Square, St. Basil’s the Kremlin and more. Moscow is one of Europe’s most vibrant cities and one of Russia’s most historical. All of our tours to Moscow are fully customizable and can be adjusted to fit any budget. Our most popular tours are listed below. Please click on the tour details to learn more or contact us for more information about our Moscow tours using the form at the side of the page. You can also schedule a call with one of our Russian travel specialists to learn more.

Classic Moscow

This is our most popular Moscow tour that includes all the most prominent sights. You will become acquainted with ancient Russia in the Kremlin, admire Russian art in the Tretyakov Gallery, listen to street musicians as you stroll along the Old Arbat street, and learn about Soviet times on the Moscow Metro tour.

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A Week in Moscow

This tour is a perfect choice for those who wish to get to know Moscow in depth. One of the highlights of this package is the KGB history tour which gives an interesting perspective on the Cold War. You will also have time for exploring the city on your own or doing extra sightseeing.

Weekend in Moscow

This tour is a great way to get acquainted with the capital of Russia if you are short of time. You will see all the main attractions of the city, the most important of which is the Kremlin - the heart of Russia. The tour starts on Friday and can be combined with a business trip.

Group Tour Moscow Break by Intourist

Russia's capital has so much to offer, from the Kremlin and the Metro to the Old Arbat street and the Tretyakov Gallery. Besides these sites, you will also visit a fascinating country estate which today is quite off the beaten path, Gorky Estate, where the Soviet leader Lenin spent the last months of his life.

Kolomenskoye Tour with transport

The history of Kolomenskoye stretches back for centuries. In 1380, Dmitri Donskoi’s army passed through Kolomenskoye on their way to the Kulikovo battlefield, and it was...

Tours by car

Kremlin, Red Sq., Cathedrals & Armory Tour

The Kremlin is truly a fascinating structure, at the same time it is an ancient tower, the city’s former military fortification, a palace, an armory, the sovereign treasury...

Walking tours

Kremlin, Red Sq., Cathedrals, Armory, Diamond Fund Tour

Old Arbat walking tour

You will be told of the street’s interesting history and view the street’s artisan culture. You will also have the opportunity to view and purchase souvenirs from the...

Tour to Sergiev Posad with transport

Considered by some to be the Russian Vatican, Sergiev Posad is the temporary residence of the Patriarch of the Russian Orthodox Church. The Trinity St. Sergius Monastery (Lavra)...

Tour to Kuskovo with transport

The Kuskovo Estate often called the Moscow Versailles due to its perfectly preserved French park, is an example of an 18th century, luxurious Moscow summer residence. Its history...

Tour to Tsaritsyno with transport

The Tsaritsyno Estate is located in the southern part of Moscow. The estate was constructed for Catherine the Great by the Russian architects Bazhenov and Kazakov in a romantic...

Moscow Metro and Old Arbat Tour

The Moscow Metro is one of the largest and most grandly built metro systems in the world. It was meant to be a showcase of the Soviet Union’s achievements for both the Russians...

Vodka Museum Tour with transport (excursion and vodka tasting)

Vodka is an important component of Russian life, an element of national identity and everyday culture. We invite you to visit the Vodka Museum and feel the atmosphere of long-gone...

Mikhail Bulgakov Apartment Museum

This apartment museum located close to Patriarch Ponds became the prototype of the "bad apartment" described in the novel "The Master and Margarita." Currently the museum's...

Kremlin, Red Sq., Cathedrals & Diamond Fund Tour

The State Museum of Lev Tolstoy Tour

Take this opportunity to learn more about the Russian writer Lev Tolstoy. During the visit to the museum you will see part of a vast collection of exhibits connected to Tolstoy...

Novodevichy Convent Tour with transport

Tour of the Novodevichy Monastery. Founded in 1524 by Grand Prince VasiliIoanovich, the original convent was enclosed by fortified walls and contained 12 towers. The structure...

City Tour with Visit to St. Basils & Red Sq. with transport

Panoramic City Tour. This Moscow tour is a great start to your trip and the best way to get acquainted with many of the city’s major highlights. Our professional guide will...

City Tour of Moscow

Head to the heart of Moscow with a professional guide on a 4-hour private walk through the city center. See Tverskaya and Old Arbat streets, Theatre Square with the world-famous...

Moscow Metro walking tour

Kremlin, Red Square and Cathedrals Tour

KGB Tour with transport

This is a very interesting and insightful tour. You will visit places connected with Stalin’s terror - a time of great repression and fear. You will be shown monuments to...

Soviet and Post-Soviet Moscow Tour

The tour begins with a drive or walk down Tverskaya Street – a Soviet masterpiece. In the years of Soviet power, Tverskaya began to undergo a transformation: it was widened...

Tretyakov State Gallery Tour

This world-famous gallery contains masterpieces of Russian art beginning in the 10th century up until today. You will view exquisite Russian icons and paintings from the 18th and...

Jewish Heritage of Moscow Tour

This tour offers a detailed look into the history and present-day life of the Jewish community of Moscow. On the tour, you will visit sites connected with the cultural and religious...

Vodka Museum Tour with transport (excursion only)

Lena, our guide in Moscow was excellent. She was very knowledgable and could answer any question we had for her. We liked that she could pick up on our interests and take us places we might not have thought of to go. When we realized that one of the places we had chosen to see would probably not be that interesting to us, she was able to arrange entry to the Diamond Fund and the Armoury for us. Riding the Metro with Lena was a real adventure and a lot of fun. In Saint Petersburg we found Anna well versed in the history of the Tsars and in the Hermitage collection. Arkady in Veliky Novgorod was a very good guide and answered all of our questions with ease. Novgorod was perhaps a long way to go for a day trip, but we did enjoy it. Vasily was a great driver to have and kept us safe with good humour and skill. We enjoyed ourselves so much, my daughter says she is already planning to return. We would both have no hesistation to recommend ExpresstoRussia to anyone we know.

Just wanted to let you know that My grandson Bruno and I couldn´t have been more pleased with our week in Moscow (6/15 - 6/21). We were absolutely enchanted with the whole experience, including getting lost a couple of times in the Metro during our free time. Although both our guides (both Eleanas) were excellent, I would particularly commend the first one (she took us to the Tatiakov, the KGB tour, and to that beautiful cemetery where so many great Russian artists, authors, composers, musicians, militarists, and politicians are buried). Her knowledge is encyclopedic; and her understanding of today´s Russia as a product of its past was, for us, truly enlightening. I will be taking another tour in Russia, with my wife, within the next two or three years. I will be in touch with you when the time comes. Meanwhile, I will refer you to other potential visitors to Russia as I meet them.

Tours to Moscow

Our Moscow tours are land only meaning that you arrange your own air travel to Russia and our expert staff meets you at the airport and handles everything else from there. Our online Airline Ticket booking system offers some of the most competitive rates to Russia available on the web so if you need tickets, please visit our Russian air ticket center . Rest assured that you will be taken great care of on one of our Moscow tours. Express to Russia has a fully staffed office in Moscow that will help to make your visit fun, informative and unforgettable. Please remember that of all these tours are private and can be adjusted to your taste. You can add, replace or skip some sights; you can add more days to the package or cut the tour short. Our specialists will be glad to help you create the tour of your dreams!

Moscow, a City Like No Other

Moscow is Russia’s largest city with a population of between 12 and 13 million. It is also Europe’s largest city and when you visit Moscow, you can feel it. The layout and architecture of the city is eclectic, ranging from crooked, ancient streets and alleyways to wide, bustling boulevards, from medieval churches to Stalin skyscrapers and to modern, glass buildings towering over everything and of course in the center of it all is the Kremlin and the magnificent Red Square. Moscow is also home to a fantastic, efficient and very beautiful metro system – each station having its own special design. In fact, Express to Russia’s Moscow metro tours and excursions are some of our most popular attractions that we offer. On our Moscow tours, you will see this and more.

Moscow Tours centering on Russian History

Moscow has a long and interesting history and has been the capital of Russia in many of its different iterations – capital of the Grand Duchy of Moscow , the Russian Empire and of course the Soviet Union (who could ever forget the Soviet Union?). Moscow, was founded in the 12th century by Prince Yuri Dolgaruki (Yuri of the long arms – he really did have long arms!). From that time on, it was home to the Russian Tsars until Peter the Great moved the capital to St. Petersburg in 1703. The city has survived invasions and sieges from the Mongols, the Tartars, the Poles, Lithuanians and Napoleon but has always persevered. Our Moscow tours will enlighten you on this great history and give you insights into Muscovites and their unique culture. Our Moscow tours show you what the city is like today but also brings to life the past. Moscow never seems to sleep and is bursting with energy. A Moscow tour with Express to Russia is truly the best way of getting to know Russia’s largest and most vibrant city.

Frequently Asked Questions From Our Travelers

What is the best time to visit moscow.

Any time of year is fine depending on what you plan to do. Summertime is pleasantly warm, ideal for exploring the city and its vibrant atmosphere, but Moscow will be much busier and accommodation is more expensive. Winter can be quite cold but beautiful nonetheless, and this is unproblematic if you intend to spend most of your trip in museums and galleries. There are also various festivals and events organised throughout the year. For more information about the best time to visit, read our guide

How many days are enough in Moscow?

If you plan your itinerary strategically and aren’t averse to a packed schedule, you can cover Moscow’s main sights over a long weekend. Most popular attractions are in the city centre, and the Moscow Metro allows you to cover much ground in a small amount of time. Ensure that your accommodation is fairly central and book tickets in advance, so that you can make the most of your days. For an informative and well-organised day out, check out our Moscow day tours with options to suit all interests.

Do they speak English in Moscow?

As Russia’s capital city, tourists are well accommodated in Moscow. There should be English-speaking staff in restaurants, bars, hotels, shops and attractions in tourist hotspots, and there are also English-speaking tourist police. Transport services have English translations on their maps and English announcements via intercom; alternatively, order taxis from the Yandex Taxi app (Russian Uber), though it’s unlikely that your taxi driver will speak English. If you get stuck and cannot communicate, it’s fine to use Google Translate.

Is it safe to travel to Moscow?

It is no less safe to travel to Moscow than to any European city if you exercise common sense and look after your belongings. As with every city some regions can be more unsavoury than others, but no tourist attractions are located there. The traffic in Moscow is notorious, so exercise caution when crossing roads. Do not take unlicensed taxis; book in advance or take public transport, which is widespread and perfectly safe. If you encounter any problems, look for the special tourist police who can help you. For more information, read our guide about staying safe in Russia .

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