Human Catastrophy: At least 3,800 Migrants Rescued from Mediterranean over the last 4 days

Italy – IOM teams in Italy reported Tuesday (17/2) that 933 migrants have arrived on the island of Lampedusa during the past 24 hours, bringing to at least 3,800 the total number of survivors rescued from the Mediterranean since Friday (13/2).
In addition to nearly one thousand migrants now being processed in Lampedusa – where the capacity of the reception centre is normally just 400 – almost 300 more either are bound for the port of Pozzallo, on the island of Sicily, or are already in a reception centre there. Three hundred more are en route to the port of Calabria, while 640 rescued migrants are bound for Porto Empedocle, also in Sicily. Late Monday IOM learned that 265 rescued migrants also are bound for Lampedusa.
Italy’s Ministry of Interior reported 3,528 migrants arrived in Italy by sea in January. Totals for February already have topped last month’s arrivals, indicating 2015’s human smuggling season is starting earlier than in years past, with potentially lethal consequences. In 2014 IOM reported 3,279 migrants died attempting to cross the Mediterranean bound for Europe.
It is not yet known how many fatalities may have occurred during what is believed to have been a flotilla of a dozen or more inflatable boats that left Libya last Tuesday, just days after a smaller fleet foundered, killing an estimated 330 migrants, most of them from Sub-Saharan Africa.
As violence escalates in Libya, IOM has called for world governments to act swiftly to face the growing threat to migrants, as over 1,600 people were rescued from unseaworthy boats this weekend.
“This is a very clear signal that the situation in Libya is unravelling,” said IOM Director General William Lacy Swing. “We must stand ready to assist thousands of extremely vulnerable people who need our help.”
IOM yesterday (16/2) reported the rescue since Friday of over 1,600 migrants discovered on multiple vessels just days after some 330 people were reported lost, presumed drowned, the previous weekend. The departures illustrate the humanitarian emergency unfolding across the North African country.
IOM staffers in Sicily and Lampedusa are assisting Italian authorities as they care for the latest victims of criminal Libyan gangs, who reportedly beat and robbed victims, while forcing them into unseaworthy boats on a beach 15 km from Tripoli. One survivor told IOM: “They forced us to leave using guns; they beat many of us and took all our belongings.”
No deaths have been reported in almost a week. But IOM staff may learn of fatalities as they interview the hundreds of survivors due to arrive in Italy during the coming days.
IOM said that the migrants were rescued starting Friday, February 13 by the Italian Coast Guard and other ships patrolling the Mediterranean. Most are from Sub-Saharan Africa, although at least 200 Somali migrants are among the survivors.
Director of IOM’s Coordinating Office for the Mediterranean Federico Soda warned that he expects voyages like these will continue as Libya’s violence worsens.
“Migrants are forced to travel on unseaworthy boats and in dire weather conditions,” Soda said. “Given these circumstances, the (relatively small) number and the kind of ships used at the moment would be unable to rescue a large number of people fleeing Libya.”
Libya’s deepening chaos raises the stakes for Italy and all of Europe as officials across the continent debate the future of the European Union (EU)’s border control policies.
Italy’s Operation Mare Nostrum, in place from October 2013 until late last year, was responsible for the rescue of over 172,000 migrants put out to sea by smuggling gangs in Africa. It has been replaced by an EU programme called Triton, which is administered by the Frontex EU border agency.
“The current system, Triton, patrolling the Mediterranean clearly is inadequate in the face of this situation,” Ambassador Swing added. “It is necessary to establish immediately a rescue system on the high seas that can respond to this emergency effectively to save migrants off Libya’s coast.”
Chilling details still are emerging from the boats that departed Libya over a week ago. “D”, a 20-year-old migrant from Mali, among the survivors arriving in Lampedusa last week, said he witnessed the drowning of dozens of his fellow passengers.
“We left on a rubber dinghy with more than 100 [passengers],” “D” told IOM, explaining how four inflatable vessels departed from a beach 15 km from Tripoli, on Saturday, February 7. “On Sunday, around 11.00 am, our dinghy collapsed. Thirty people fell in the water, while I held on to the boat with another 70.”
“D” explained that he held on until 3.00 pm the next day. “For hours I watched as my fellow passengers died one by one, exhausted by the cold, the waves, and the rain, letting themselves fall in the sea. I saw them drift away, with their hands close to the surface,” he said.

IOM 17.2.2015


Capesize Chartering Ltd: The New ‘BIG’ kid on the bloc ?

Five dry bulk shipping firms, including shipping tycoon John Fredriksen’s Golden Ocean will form a new venture to coordinate chartering services, hoping to reduce costs in a fragmented market, the firms said in a joint statement. The firms, including Golden Ocean, Bocimar International, CTM, Golden Union Shipping and Star Bulk Carriers will form Capesize Chartering Ltd., aiming to start up operations by the second half of February. “The parties operate in the highly competitive and fragmented capesize industry, and neither party owns, controls or manages sufficient capesize vessels to provide competitively priced bids and efficient trading and operations to serve its customers,” the firms said. “The new company will combine and coordinate the chartering services of all the parties,” they said. “For the customers this represents the benefit of a wider geographic area in which vessels can be made available and with shorter spread between loading dates.”


Shipping: How drug smuggling lead to a CTL (constructive total loss) of a vessel !!

Vessel detained and ultimately confiscated following discovery of cocaine – Interesting legal case

In a recent case before the English High Court, insurers sought to rely on exclusions for loss arising from detainment by reason of infringement of customs regulations and for loss arising from failure to provide security.

An interesting decision of Mr Justice Flaux in the English High Court of Justice in Atlasnavios-Navegacao LDA v Navigators Insurance Company Limited & Others (2014) EWHC 4133 (Comm) concerned an insurance claim by the owners for the constructive total loss of a vessel by reason of her detention for longer than six months after the vessel was detained in Venezuela following the discovery of bags of cocaine strapped to the vessel’s hull below the waterline.
While it was never suggested by insurers that the owners themselves were implicated in the commission of a drug smuggling offence, insurers sought to rely upon exclusions in clause 4 of the Institute War and Strikes Clauses for loss arising from detainment by reason of infringement of customs regulations and for loss arising from failure to provide security.

While two officers, the Master and the second officer, were charged in Venezuela with complicity in drug smuggling, of which offence they were convicted in August 2010, the court also ordered the final confiscation of the vessel. The owners had abandoned the vessel to the Venezuelan court some two years after the initial discovery of the drugs.

Exclusions under the insurance policy

The Institute War and Strikes Clauses provide in clause 3:

In the event that the Vessel shall have been the subject of capture seizure arrest restraint detainment confiscation or expropriation, and the Assured shall thereby have lost the free use and disposal of the Vessel for a continuous period of (6) months then for the purpose of ascertaining whether the Vessel is a constructive total loss the Assured shall be deemed to have been deprived of the possession of the Vessel without any likelihood of recovery.
There were also exclusions of loss damage liability or expense arising from, amongst other things, “arrest restraint detainment confiscation or expropriation under quarantine regulations or by reason of infringement of any customs or trading regulations” (4.1.5) and “the operation or ordinary judicial process, failure to provide security or to pay any fine or penalty”.

The owners maintained that there was no infringement of customs regulations, as the proximate cause of the detention of the vessel was the malicious act of the drug smugglers, rather than the infringement of the customs regulations. They further maintained that the proximate cause of the detention of the vessel was “the wrong and perverse decision” of the judge who ordered detention of the vessel.
The insurers conceded that the infringement of customs regulations exclusion would not apply to a “put up job” such as would occur if the Venezuelan authorities had deliberately planted the drugs (or engaged a third party to do that) so as to detain the vessel.

Court finds that policy provided cover for malicious acts of third parties

The judge saw no distinction between a “put up job” and a case where drug smugglers were involved in planting the drugs upon the vessel.
Following an extensive analysis of the evidence and of the applicable law, Mr Justice Flaux concluded that the claim for a constructive total loss succeeded on the basis that there was cover under the policy for the malicious acts of the third parties who strapped the drugs to the hull of the vessel and that the exclusion for infringement of customs regulations did not, as a matter of construction, apply to exclude cover in the circumstances of the case.
He also concluded that the exclusion for failure to put up security did not apply, as he doubted whether owners would have been able to negotiate satisfactory and reasonable security with the Venezuelan authorities in any event.

Owners entitled to recover range of expenses related to vessel’s detainment

The judge found that the owners were entitled to recover sue and labour expenses, including the legal expenses incurred in seeking the release of the vessel and defence of the crew, the running costs during detainment of the vessel until the actual abandonment and a payment made to private investigators, ostensibly to determine who were the real perpetrators of the drug smuggling and with a further success fee to be paid if the vessel was released.
The judge rejected the argument that the proximate cause of the detention of the vessel was a perverse or wrong decision of the Venezuelan court.

Effect of exclusions where there is malicious intervention by a third party

While the case was very much one which was considered on the basis of its own peculiar facts and which involved evidence from Venezuelan lawyers largely around the proceedings in Venezuela, it nevertheless raised interesting issues about the exclusions under the Institute War and Strikes Clauses and their effect when there is malicious intervention by a third party.

CBP Lawyers/HSN


Copenship files for bankruptcy

Distress in the dry cargo market bubbled to the surface this week with the collapse of Danish operator Copenship, which threatens to affect at least two well-known shipowners, while rumours are circulating about others.
Copenship and subsidiary Copenship Bulkers filed for bankruptcy on Tuesday, with the Baltic Dry Index (BDI) just 23 points above the historic lows seen in 1986 and market rumours of up to 200 supramax and ultramax vessels for sale and no willing buyers.

Operations at Copenship ceased after its filing with the Maritime and Commercial Court in Copenhagen, Denmark, with the company blaming an extremely poor market, counterparty defaults and unsettled claims.
Details relating to the activity of the privately held company are in short supply, meaning very little information is available on Copenship’s counterparties before they are declared to the court, and chief executive Michael Fenger could not be reached to shed further light on the situation.

Wisdom Marine Lines, Taiwan’s biggest shipowner, is one of those with exposure to Copenship.
Wisdom business director Mike Chao confirms to TradeWinds that his company has two 61,000-dwt bulkers on period time charters to Copenship but prefers not to reveal the names.

However, one of the ships seems likely to be Wisdom’s 61,000-dwt Copenship Wisdom (built 2013) and TradeWinds understands the other is the 61,400-dwt Amis Wisdom VI (built 2011).

The two went on charter for 54 to 60 months in March 2013 to Copenship Bulker AS and December 2012 to Copenship Broker AS, respectively. The two ultramax charters were done a couple of years ago, Chao says.
“Up to today, one of the ships has been paying okay,” said Chao.
“The other one is behind, so we are consulting with legal counsel to recover what we are owed.”
But he acknowledges that the Copenship bankruptcy filing will complicate such efforts. He characterises the amount that is currently due as being more than $1m. Prospective damages from future loss of hire on the lives of the charters are not included.
“We probably don’t know more than you know about it,” said Chao.
TradeWinds has also confirmed that Turkey’s Ciner Shipping has two 63,500-dwt ultramax bulkers chartered to Copenship.

However, it is believed that the Yangzhou Dayang-built Samsun and Konya (both built 2013) are fixed to Copenship’s Singapore operation, which has not declared bankruptcy.
“Numerous outstanding hire payments are pending,” said a source close to the Istanbul-based company.
Western Bulk was mentioned as another outfit with exposure to Copenship but TradeWinds is told its position is “limited” and “short term”.
Copenship is the first dry cargo casualty in the latest slump and the jury is out as to whether further failures will soon follow.

“Lots of companies struggling in 2009 through 2013 are not left with a lot of fat on their backs. Everybody is in a bad place right now,” said one major bulker executive.
On its website, Copenship says it operates more than 50 vessels at any one time. After its exit from the panamax market last year and the dire rates on offer right now, sources suggest it may have 10 or fewer ships left to hand back.
While some fear more collapses may follow, others say this is unlikely given the size of the remaining fleet.
It appears Copenship intends to continue in the multipurpose (MPP) business, run via its Copenship MPP A/S brand, which was not mentioned in the bankruptcy document. Sources suggest a positions list was circulated by the company on Wednesday.

Copenship filed for bankruptcy on a day when the BDI sat at 577 points. It declined further to 569 points on Wednesday, just above the record low of 554 points of 31 July 1986, according to data from Bloomberg.
With rates so low, TradeWinds is told that up to 200 ultramax and supramax bulker resales are available in the market, with one executive placing the buying interest at zero.
“The buyers are the prudent ones,” the executive said.
Despite the distress in the market, sources say major counterparties have yet to make the call for leniency on charter contracts. Phones could start ringing in the next few months, it is suggested.

Tradewinds 6.2.2015

BIMCO issues Gulf of Guinea Security Advisory

BIMCO issued an advisory to highlight recent events in the region and reinforce guidance.

As reported by BIMCO last weekend armed pirates boarded and hijacked a fishing vessel underway off Togo. The Togo Navy responded and engaged the pirates. Twenty crew jumped overboard in an attempt to escape, and were rescued by the patrol boat. The remaining seven crew were taken hostage as the pirates fled heading out to sea. The pirates later left the ship and the crew sailed towards a safe port. One crew has been reported as killed in the incident.

On Wednesday, 4 February, night it is reported by IMB that armed pirates attacked a Greek-owned tanker while it was waiting to load off Nigeria, killing its Greek deputy captain and taking hostage three other crew. The attack on the ship Kalamos, which had a crew of 23 and was sailing under a Maltese flag, took place at Qua Iboe. Members would want to know BIMCO has further heard that the Master activated the SSA and made a distress call which was received on channel 16, requesting for medical assistance as a result of injuries sustained from the pirate attack on the ship. Three persons are missing, while in fact 2 crew were injured , one fatally as reported. A NIMASA patrol boat was said to have engaged the pirates in a gun battle. The pirates were said to be using two speed boats and are well-armed. It is understood that the First Officer was shot twice and the ship is making arrangements to evacuate the other injured crew. The injured person is believed to be the ship’s Chief mate. Three crew have been abducted from the ship (2nd Officer and 2 x AB).

Operators are reminded that the region has become extremely dangerous and product tankers and kidnapping of Caucasian crews seem to be the primary objective of the pirates. Although , as above, no type is entirely safe.

The use of PMSCs.

As reported by BIMCO Security the Nigerian Government has said that it will not hesitate to detain any ship entering the country’s territorial and coastal waters with security escorts on board, whether armed or unarmed. The Nigerian Maritime Administration and Safety Agency, NIMASA, gave this warning when the agency detained three ships, LILAC VICTORIA, UACC EAGLE and MORGANE, because they sailed into Nigeria with individuals linked to private security firms overseas offering training on the use of weapons.

Operators are advised to note this intention which has been corroborated by other third party sources. On February 4th, two PMSC Guards were arrested and a ship detained although cargo operations have been allowed to continue. It is not yet known if the guards were armed or not.

Operators are reminded that detailed BIMCO Guidance on Gulf of Guinea Piracy can be found in “Guidelines for Owners, Operators and Masters for Protection against Piracy in the Gulf of Guinea Region“. The principles and best practices outlined are in many areas identical to dealing with SOMALI piracy and are strongly recommended. It is strongly advised if trading Nigeria members seek assistance from NIMASA or the Nigerian Navy, the only legitimate sources of protection.

Source: BIMCO


For Sale: Self Propelled Construction Barge

After concluding a long term charter in West Africa, barge is again available around March/April 2015- Brief Description:

Built: 2006
Dimensions: 60 x 24 x 5.4m
Class: BV
Draft: 1.35m min / 3.1m max
Bow: 2 x HRP 400 retractable azimuthing thrusters 525kW
Stern: 2 x HRP 400 retractable azimuthing thrusters 580kW
Main Engines: 4 x Caterpillar
4 Points Mooring: 1 x 60t anchor winches / 5t Delta Flippers
Crane: SWL 2.5t @ 25m, lifting capacity up to 350T
Capacities: Gasoil : 235 m3 / Fresh water : 800 m3
Deck Cargo: 1030 t
Deck Loading capacity: 10t/m²
Free Deck Area: 650m²
Accommodation: for 50 pax 22 crew (partly in modulare accommodation units)

This vessel is highly multidisciplinary and can be used for a variety of projects:

-as a 4pt mooring vessel
-as a DP2 offshore unit
-as a shallow water vessel
-as a diving support vessel
-as a accomodation barge
-as a painting support vessel
-as a crane support vessel (project)

Further info available against named interest only.

Thank you.


Charterers Liability and P+I cover


A Swedish carrier, SES, bareboat chartered a tugboat from its owners SST in Norway. The tugboat was used to transport a carriage of sugar beet, among other things, to a plant in Nykoebing Falster, Denmark. During carriage from the Port of Assens in Denmark to Nakskov, the tug caused damage to a pier in the Port of Assens. SES had taken out charterer’s protection and indemnity (P&I) insurance through a Swedish insurance broker and the cover was provided by Lloyd’s of London. The insurance was subject to English law and it followed from the insurance contract that disputes with the insurer were to be exclusively decided by the High Court in London:
“This insurance shall be governed by and construed in accordance with English law and, in particular, be subject to and incorporate the terms of the Marine Insurance Act 1906 and any statutory modification thereto. This insurance, including any dispute arising under or in connection with it, shall also be subject to the exclusive jurisdiction of the High Court of London.”

SES was subsequently declared bankrupt and legal proceedings – in order to obtain compensation for the damage to the pier – were brought directly by the port against the insurer before the Danish Maritime and Commercial Court pursuant to Section 95 of the Danish Insurance Contracts Act, which provides a right for an injured party to claim directly against the liability insurers of the party which is alleged to be liable for the damage. During the proceedings, the insurer submitted that the Danish court did not have jurisdiction to hear the dispute and referred to the exclusive jurisdiction clause in the insurance contract. In particular, the insurer submitted that the jurisdiction agreement also applied to the claim brought by the Port of Assens. The port disputed that the jurisdiction clause was of any relevance to the proceedings.

The court found that the jurisdiction clause in the insurance contract did not contradict the mandatory provisions of Articles 8 to 14 of the EU Brussels I Regulation on jurisdiction agreements in insurance contracts, as the insurance contract in question was a liability insurance relating to the financial loss connected with the use or operation of ships and consequently concerned a risk in relation to which Articles 8 to 14 derogated from. Further, the court found that the jurisdiction agreement applied to the proceedings brought by the Port of Assens against the insurer as the port, pursuant to Section 95 of the Insurance Contracts Act, was found to have stepped into SES’s right to insurance coverage. The court stated as follows:
“The legal entity causing damage, SES, has been declared bankrupt and the question, on this basis, is how the Insurance Contract Act, S 95 is to be interpreted … The court finds that S 95, in accordance with its wording and its purpose, must be interpreted to the effect that the party claiming damages steps into the rights of the insured against the insurer, including any possible special terms and conditions applicable between these parties, in this case, the choice of law and jurisdiction agreement providing for jurisdiction in England and Wales. Consequently, the court does not have jurisdiction over this case.”(1)

The judgment decided on the keenly disputed and important issue of whether a jurisdiction clause in a liability insurance is to be given any effect in proceedings brought by a claimant which is not a party to the insurance contract directly against the liability insurers where such a direct action is permitted pursuant to Section 95 of the Insurance Contract Act. Some legal writers have suggested that the injured party’s right to a direct action is provided for by law and therefore this right cannot be influenced by conditions, including jurisdiction clauses, which have been agreed between the insured and the insurer, as this would be contrary to the principle of privity of contract.

Conversely, other legal writers maintain that an injured party pursuant to Section 95 of the Insurance Contract Act “steps into the shoes of the insured” and therefore the injured party cannot sue the insurer before a venue that is contrary to a jurisdiction clause in the insurance contract. The Maritime and Commercial Court has followed this latter interpretation. The court also apparently assumed that Section 95 of the Danish Insurance Contract was applicable to the claim brought in the international case heard. It is not clear under Danish law whether Section 95 should apply in international cases.


Birch Windahl/HSN