Current Trends and Challenges in Maritime Law

Principal Features of Maritime Law

In general terms, Maritime Law means all legislation related to ships and shipping, including shipbuilding, navigation, crewing, operation and other activities and incidents related to ships. One feature is its international nature, which pleads for international uniformity in maritime law. This necessity has been satisfied in­ternationally by implementing a number of international conventions or agreed rules like the Hague-Visby Rules, unifying certain rules of law relating to Bills of Lading, or the York-Antwerp Rules, fixing the grounds for general average assessment. In some jurisdictions, particularly in Ukraine, the provisions of such conventions are implemented in local laws such as Merchant Shipping Code or similar. The widespread use of standard proformas ser­ving as grounds for most contracts of carriage (like GENCON, SIINACOMEX, NYPE or BPTIME3) also has the effect of ­unification.

The second obvious feature of maritime law is that contracts for carriage of goods by sea end up being performed in specific and often hazardous con­ditions, under which it is practically ­impossible for one party to supervise the work of another party on a daily ­basis. This factor is the key instru­ment in development of the sea carrier’s gene­ral duties and legal grounds for them, including the duty to provide a seaworthy ship and not to deviate from the route stipulated by the charter party as well as other carrier’s duties related to sea voyage. It also influences those aspects of maritime law dealing with the shipper’s duty to disclose the dangerous nature of shipped goods, the master’s powers on waste discharge and other extraordinary powers conferred on the master of the vessel in the emergency event.

The third notable feature affecting the nature and practice of maritime law is that shipping regulated by such maritime law depends directly on other commercial activities. Contracts for carriage of goods by sea are not made in commercial isolation. They are typically concluded in order to sell goods or to give effect to a previous sale. It means that contracts for sea carriage often reflect the direct interest of either the ­sellers or buyers under the sales contract. Third parties may get involved in carriage of goods by other means. It raises complex questions: who can sue and who can be sued? In the absence of a contract provision dealing with a particular problem, the main role in such cases is played by the governing law of a carriage contract, which for the majority of sea carriage contract forms is either English law or the local law at the place of the incident in question.

Current Trends and Challenges

General Average

The old institute of general average, attributed to maritime law only, was largely developed in 2016, when the International Maritime Committee (CMI) adopted new wording of the York-Antwerp Rules (YAR 2016). This new wording touches upon quite essential issues governing relations on general average. In particular, modifications are aimed at stepping up the process of drafting a dispatch, to clarify terms of proceedings and to eliminate unjustified enrichment of any party to the general ave­rage. Essential modifications touched only the costs of rescue and restriction of sums of damages to be distributed in respect of general average.

Ship Arrest

The most essential innovation today probably concerns amendments to civil and commercial, particularly the procedural legislation of Ukraine regarding ship arrest under maritime claims.

Recent reform of procedural law in Ukraine facilitated significantly stabilization of ship arrest practice under maritime claims. The new version of the Commercial Procedural Code of Ukraine sets out a special regulation for claim security measures — the institute of so-called paper arrest (i.e. cases on ship arrest shall be considered by the commercial court at the location of the Ukrainian sea port where the vessel stays or calls, or the vessel’s ­registry port).

Interlegal’s lawyers hold the all-time record for ship arrest in the Black Sea Region. In 2018 we arrested over 20 vessels. Innovations in law significantly simplified court practice and facilitated more frequent debt recovery in favour of our clients, namely agencies, bunkering and ship repair companies.

Arbitration in Shipping

Since the most popular choice for ma­ritime arbitration still remains London, Interlegal has opened a representative office there. Most standard proformas of charter parties, international sale contracts, salvage contracts, reinsurance and P&I Club Rules provide for London arbitration, and particularly arbitration at the LMAA (London Maritime Arbitrators’ Association). Many bills of lading incorporate an arbitration clause in the charter party under which the bill of lading is issued.

Ukraine as a Maritime State

Ukraine, as a maritime state, has established short sea links with Turkey, Russia, Georgia, Bulgaria, Romania and Greece along with direct rail links to Central Europe, the Baltic States, the Russian Far East and Central Asia, thereby making Ukraine a transshipment hub too.

Ukraine is one of the leading global grain and sunflower oil exporters and is an important seagate for the import and export of commodities and goods. According to forecasts by the Ukrainian Grain Association, Ukraine can produce more than 100 million tons of grain and oilseeds annually by 2022, of which around 70 million tons would be for export.

There is also the Maritime Arbitration Commission at the Ukrainian Chamber of Commerce and Industry, an independent permanent arbitration institution opera­ting under the Law of Ukraine On International Commercial Arbitration dd. 24 February 1994.