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INTLREG NEWS

COVID-19 AND ITS CONSEQUENCES ON SHIPBUILDING CONTRACTS

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The spread of the COVID-19 virus is causing significant issues in the shipbuilding industry, but English law has no general concept of force majeure, and this is a key factor in the relationship between shipyards and shipowners.

Shipyards are facing disruption to new building, repair and conversion projects due to the impact of the virus on their labour force and the ability of their subcontractors to meet their commitments to supply materials and equipment necessary for the completion of such projects.

As a result, shipyards in China, and elsewhere, have sought to invoke the force majeure provisions under their contracts with shipowners because of COVID-19 in order to obtain ‘no fault’ extensions of the delivery dates under these contracts.

This in turn has caused issues for shipowners who are now facing potential delays to the delivery of the vessels that they have contracted to buy, repair or convert, especially where those vessels are for delivery into a specific project or long term charter or the conversion works are linked to compliance with the 2020 low sulphur fuel cap.

Because most contracts are subject to English law, shipbuilding contracts must have an actual force majeure clause for the shipyard to claim force majeure and the burden of proof is on the shipyard.

On BIMCO’s website, members can read the full article that looks at force majeure provisions in standard form shipbuilding contracts and how these might operate in the context of COVID-19.

International Register of Shipping (INTLREG) to be the First RO to sign re-validation of the existing approval as per new regulations from MARINA

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International Register of Shipping (INTLREG) to be the First RO to sign re-validation of the existing approval as per new regulations from the Marina, The Maritime Industry Authority -Philippines.

International Register of Shipping (INTLREG ) and The Maritime Industry Authority (MARINA) signed the Memorandum of Agreement (MOA) governing the delegation of statutory certification and services for ships registered in the Philippines on 14 October 2019 at the MARINA Central Office.

MARINA Vice Admiral Narciso A Vingson Jr commended the IRS for accepting the duties and responsibilities as Recognized Organization to perform statutory certification and services to Philippine shipping companies and their Philippine-registered ships, pursuant to the Recognized Organization Code and the MARINA Circular No. 2018 – 01.

“It is my sincere hope that this joint endeavor will stand as one of a long and continuing list of meaningful collaborations between the MARINA and INTLREG. As our goal, that is to achieving harmonized global implementation of requirements established by international maritime instruments to ensure the safety of life at sea and protection of the marine environment,” VADM Vingson said.

VADM Vingson and Captain Everton Morris, Director of Certification, signed the MOA on behalf of the MARINA and INTLREG respectively. The signing was witnessed by Ms. Nannette Z. Villamor Dinopol, MARINA Deputy Administrator for Operations, and Ms. Catalina V. Thomas, IRS Operations Manager.

The MOA, as presented by the Director of the MARINA-Overseas Shipping Service (MARINA-OSS), Atty. Jean Ver P. Pia, consists of two (2) parts. The first part provides the main agreement which includes the application, purpose, general conditions, execution of functions, legal basis, interpretation, equivalents and exemptions, reporting to the flag state, development of rules and regulations, information and liaison, supervision/audit/oversight function and other conditions.

The second part contains the three (3) Annexes, which provide the list of applicable instruments, Degree of Authorization for a particular applicable document, and requirement of reporting to the MARINA.

Per MARINA Circular 2018-01, Recognized Organizations assessed by the Administration are authorized to carry out statutory certification and services under mandatory International Maritime Organization (IMO) and International Labour Organization (ILO) instruments, national legislations, rules and regulations, to Philippine shipping companies and their Philippine-registered ships engaged or shall engage in international voyages and domestic trade.

INTLREG is expanding surveyor network at Philippines with authorization for domestic as well as International vessels with the approval of MARINA (Maritime Industry Authority).

Our Services include: –

  1. Classification & Statutory Surveys –
  2. ISM Internal & External Audits –
  3. New Build Services

INTLREG is fully approved for classification and statutory certification by the MARINA for vessels flying the Philippines flag with an exclusive survey station based in Manila.

To request classification or statutory certification services or to coordinate a survey or ISM Audits or New Build Services  please contact : services@intlreg.org