2014 BIMCO eBL clause does no longer seem to fit current market and increasingly prevents eBL digitalization rather than facilitates it. 2014 BIMCO Clause assumes simple Charterers’ option to request Owners to accept eBL against (outdated indemnity) that may be hard to accept by an Owner being a Freight Operator/ Disponent Owner as it affects/limits such operator’s ability to find/nominate suitable performing vessels from the market if they do not offer own but a say a Time Chartered, pool or spot tonnage.
In a current freight market, there are usually several parties between top Charterer and the Head Owners (Registered Owners) with multiple Charter Parties in between, each party needing to agree to relevant eBL clause. Top Charterers imposing 2014 BIMCO Clause onto their freight departments/ providers hit a reasonable counterargument. While education about eBL solutions continues there are still many players that need to be engaged, persuaded and onboarded, which inevitably takes time.
There is an urgent need to propose a solution that recognizes current, interim period in eBL adoption/implementation where not all Head Owners (Registered Owners) are educated about, are willing to accept or delegate control of eBL.
Instead of a clause including only Charterers’ option and (legally outdated) indemnity, alternative clause may introduce concept of Owners’ approval to Charterers’ request that may not be unreasonably withheld.
The following table proposes a new, simpler and more convenient eBL Charterparty Clause (left), comparing it with the old, 2014 BIMCO eBL Clause (right)
| NEW – Electronic Bills of Lading Clause | OLD – 2014 Bimco eBL Clause |
| (a) Not later than upon nomination of the performing vessel, Charterers have the right to request Owners in writing to issue, sign, and transfer a Bill of Lading or Sea Waybill referred to in this Charter Party/CoA in electronic form with the same effect as their paper equivalent. The Owners’ approval shall not be unreasonably withheld or delayed; “unreasonably withheld” shall mean any refusal that lacks legitimate basis or is made in bad faith. Parties shall diligently endeavour to obtain all necessary approvals from, and ensure participation of, all relevant parties to the respective Bill of Lading or Sea Waybill, as well as their contractual partners, within a reasonable timeframe.
(b) The parties shall subscribe to and use Electronic Bill of Lading system (by XXX), provided such system is approved by the International Group of P&I Clubs.
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(a) At the Charterers’ option, bills of lading, waybills and delivery orders referred to in this Charter Party shall be issued, signed and transmitted in electronic form with the same effect as their paper equivalent.
(b) For the purpose of Sub-clause (a) the Owners shall subscribe to and use Electronic (Paperless) Trading Systems as directed by the Charterers, provided such systems are approved by the International Group of P&I Clubs. Any fees incurred in subscribing to or for using such systems shall be for the Charterers’ account.
(c) The Charterers agree to hold the Owners harmless in respect of any additional liability arising from the use of the systems referred to in Sub-clause (b), to the extent that such liability does not arise from Owners’ negligence.
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Advantages of the newly, proposed clause:
If under top Charter Party an Owner is a Disponent Owner and not a Head Owner, clause would allow such Disponent Owner to verify if the Head Owner of the intended performing vessel agrees to eBL or not. Since we refer to a separate Charter Party between Disponent and Head Owner, should Head Owner disagree, top Charterers shall not be in a position to claim breach. Consequently, Clause introduces concept of a diligent endeavour thus allowing for a best effort rather than straight obligation.
Intention is for a Charter Party clause to recognize current freight market complexity and digitalization journey.
Further clarifications:
- eBL – legality and its acceptance:
– Terms specifying under what conditions electronic bills of lading are considered acceptable and legally binding.
Secro offers electronic templates of Charter Party Bills of Lading that are valid as electronic BL under either English or Singapore law, where choice of such law does not affect underlying law of the Charter Party (which still may remain either English or US or any other law of choice in Charter Party).
- eBL – insurability:
Any eBL solution provider and eBL template shall be approved for use by IG P&I. Secro SaaS system and eBL templates offered by Secro are approved by IG P&I.
- what is the process for issuing/management of eBL:
Once declared by Charterers, Owners are obligated to subscribe to agreed eBL system and its use for issuing and management of eBLs under this Charter Party/CoA by online execution of a simple bilateral Software-as-a-Service Agreement.
- who is liable for using eBL system:
– Responsibilities and Liabilities (Allocation of responsibilities and liabilities between parties involved in the electronic documentation process, including carriers, shippers, and consignees.)
Since Secro SaaS system operates basis a bilateral SaaS Service Agreement as executed between Secro and its Customer, issue of responsibility and liability for use of eBL system is governed by such separate and individual SaaS Service Agreement and accordingly such issue shall not form part of the given Charter Party/CoA.
Since eBL offered by Secro is a statutory law-based electronic Bill of Lading, where responsibilities and liabilities of eBL parties – as described in its Conditions of Carriage – are unchanged, no additional terms regarding parties’ responsibilities or liabilities under eBL are necessary in the Charter Party/CoA .
- who is paying for using eBL system
Since Secro SaaS system operates basis a bilateral issue SaaS Service Agreement as executed between Secro and its Customer (ie. by each party to the Bill of Lading and by each of its respective contractual partners), issue of the costs for subscription and use of eBL system is governed by such separate and individual SaaS Service Agreement and accordingly issue of eBL cost shall not form part of the given Charter Party/CoA.
- Dispute Resolution: Procedures for resolving disputes arising from the use of electronic bills of lading, including jurisdiction and applicable law.
If the dispute arises regarding use of eBL system, such dispute, as between Secro and its Customer, shall be resolved in accordance with the Law and Jurisdiction Clause of the relevant SaaS Service Agreement.
If the dispute arises under the eBL, such dispute, as between BL parties, shall be resolved in accordance with the Law and Jurisdiction Clause of the given BL/SWB (or the relevant clause of the incorporated Charter Party/CoA).
This document is not intended to provide legal advice, and you are encouraged to perform your own due diligence. Secro does not accept any contractual liability for any use or misuse of the above content.