The cost of shipping export cargo from India is expected
to go up by August, 2004, as ship owners will now have
to budget the cost of idling time at ports due to the
implementation of the International Ship and Port Facility
Security (ISPS) code.
existing and future contracts relating to ship operations
- including charter-parties, bills of lading and crew
contracts - will need to be reviewed, according to the
mutual marine liability insurer, North of England P&I
Club (P&I Club), because of the ISPS Code, due for
implementation globally by August 2004.
P&I Club points out that since ship owners and manning
agents will need to look more carefully at the people
they employ or allow on board, to prevent ships being
used by terrorists, new procedures and contractual arrangements
will need to be worked. Prevention of terrorism is one
of the main objectives of the ISPS Code.
important issue that will need to be factored in by ship
owners and others in the logistics chain is the increased
risk of delay in ports due to security issues. This will
be reflected in charter-parties and bills of lading, for
these contracts will now need to specify which party bears
loss of time for delays under ISPS rules.
Any additional costs arising out of delays, ship idling
time and the respective parties' obligations, especially
in voyage charters, due to documents and information will
have to be assigned clearly, according to the P&I
club says that unless these issues are addressed now,
all parties run risks of suffering delays, and incurring
expense that may not have been planned or budgeted for.