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Lighthouse - July, 2021.

CHAIRMAN’S MESSAGE


The ferociously lethal second wave of the COVID-19 pandemic had India gasping for breath. As India became ground zero of the global pandemic, the medical system in India was trying its best to cope with an acute oxygen crisis. The graph of daily infections that began soaring by late March breached global records on April 26th 2021, crossing more than 350,000 positive cases.

Narendra Modi, the Prime Minister of India, in his address to the nation on June 8th 2021, stated, “Never in a-100 years has there been such a pandemic, and this saw an unprecedented demand for medical oxygen across the country.”

Across India, tens of thousands of critically ill patients had their lungs damaged by the virulent strain of the SARS-CoV2 virus. As they were rushed into hospitals, the demand for medical oxygen spiked ten times from the norm. The deluge of new cases caused hospitals across the nation to post frantic alarms in the face of perilously dipping levels of life-sustaining oxygen supply.

The breath of life-saving air, which we take ever so granted, became the most precious commodity.

The international community was quick to respond to India’s time of need. The United Arab Emirates assured a steady supply of liquid medical oxygen as India was battling this deadly second wave. In a special gesture of solidarity, the iconic Burj Khalifa was lit up in the Indian tricolor and a message to “Stay Strong India.”

The CSS family feels extremely proud and considers it an honor and privilege to extend our hand of help to the nation of India in her time of dire need. CSS Kingston was instrumental in the movement of oxygen tanks and oxygen processing units from Sharjah to Mumbai. Our technical prowess and deep knowledge of critical and time-bound shipments ensured that the movement was handled seamlessly.

I want to conclude with this saying by the American footballer, Doug Baldwin.

“The greatest tragedy for any human being is going through their entire lives believing the only perspective that matters is their own.”  

The way you see the world is just the way you see the world. It defines only your truth. If you only keep looking through your lens, with time, your vision will get blurred.

Isn’t it time we borrowed the other person’s glasses?

You don’t need to agree with them. Dear CSS family, let’s try to understand our neighbor’s perspective on seeing the world. That’s how we rise to a level that’s higher than where we are.

Let’s stay connected with each other, and we can conquer the challenges that lay ahead.


WASH PLEDGE


We, Consolidated Shipping Services are proud to be a WASH Pledge signatory and commit to implementing access to safe Water, Sanitation and Hygiene (WASH) for all our employees in all of our premises. Under the pledge, we also commit to addressing WASH across our value chain, including amongst our suppliers, as well as in the communities that surround our workplaces and/or where our employees live.

Access to WASH is a fundamental human right and key to realizing the UN Sustainable Development Goals. Today, over 785 million people are still without access to safe drinking water and estimate 4.2 billion lack access to safely managed sanitation services. The WASH Pledge is an initiative created by the WBCSD (World Business Council for Sustainable Development), to engage companies to contribute to the implementation of the UN’s Sustainable Development Goal No 6 (for all people to have access to safe water and sanitation by 2030).

“As businesses, we can lead the way to significantly increase the number of people to have access to safe, affordable and sustainable drinking water, sanitation and hygiene. We call on all businesses and stakeholders to join this commitment to address one of the most pressing public health challenges of our time. We look forward to promoting social, environmental and economic well-being through our commitment to the WASH Pledge.

We would like to thank our client Xylem and WBCSD (World Business Council for Sustainable Development) for inviting us to be a part of this and hope to encourage others to participate as well. Water is our most valuable commodity on this planet and being responsible for this precious commodity is high on our priority list.” commented Anitha – GM CHR Networks & Special Projects.


CSS KINGSTON LOGISTICS FZC EXTENDS HAND OF SUPPORT IN INDIA’S COVID CRISIS


India is still reeling under the devastating second wave of the COVID-19 pandemic. Despite the prediction of a second wave, India surely could not fathom this level of impact. Within days, the counts reached staggering proportions, and India’s daily count of COVID-positive patients overtook even that of Brazil and the USA.

The healthcare system in the metro cities of the country was stretched beyond their capacity. With an increasing number of COVID patients requiring oxygen and ventilator support, there was a dire need for medical oxygen supply. In the initial days, several hospitals raised SOS alarms on social media for oxygen supply.

The crisis has prompted an outpouring of international support, offering to supply drugs, equipment, and oxygen to the country. The UAE was one of the first countries to provide unstinted support in India’s time of need.

CSS KINGSTON LOGISTICS FZC acts as the helping hands

CSS KINGSTON LOGISTICS FZC acted as the helping handing to reach out to the nation of India in this dire situation. With our capability and hands-on experience in time-bound shipments, CSS KINGSTON LOGISTICS FZC could step in and ensure that the critical shipment happened without any glitches or roadblocks. With the scope to arrange cargo from door to port using the low hydraulic bed, the requirement was to ship from Sharjah to Mumbai. Three oxygen tanks and one processing unit were part of the consignment.

Mr. Firosh, Senior Sales Executive at CSS Kingston echoed the sentiments of the CSS Family as a whole, “Team CSS KINGSTON LOGISTICS FZC feels extremely proud that we could be part of the UAE’s compassionate response to the second wave of the pandemic in India.”


CSS PROVIDES LOGISTICAL SUPPORT IN THE RETURN OF HELICOPTERS TO COLOMBIA


On the 9th of June 2021, CSS played a vital role that facilitated the movement of Mi-8 helicopters from Jebel Ali Port in Dubai, UAE, to the Republic of Colombia.

Specialized Care for Special Shipments

The operations commenced with the transportation of the two Mi-8 helicopter units from Dubai World Central Airport to the CSS CFS in Jebel Ali. The cargo units were offloaded using a 50-ton crane and then heat shrink wrapped to ensure damage-free transportation across the oceans to their final destination. Flexible and durable, heat shrink wrapping ensures that the cargo is completely weatherproof and tamperproof, regardless of its size. The helicopters were loaded onto 40’ Flatrack units and then dispatched to Jebel Ali Port after securely loading and lashing them onto the specialized air suspension low bed trucks.

One often thinks that helicopters are flown from the point of origin to their destination. However, it is more likely that helicopters are shipped either by sea or air freight. Flying the helicopters to their destination proves to be much more expensive than shipping them as you need multiple fuel stops.

CSS Capability in handling Complex Cargo

Helicopter shipments require specialists to attend to their loading and offloading and are carefully monitored every step of the way. The helicopters also require secure and proper packing. They need to be loaded under deck, or else the ocean spray can be very corrosive to this type of cargo on long transatlantic voyages, which is where the shrinkwrapping comes into play.

With its impeccable track record of carrying out the logistical requirements of several large and complex cargoes, CSS was brought on board to play the critical touchpoint in the UAE to enable the safe transit of the helicopters to Colombia. Through meticulous planning and teamwork, CSS’s operations team supervised by Suresh S and Don Raveendran made this move a successful mission.


CISCO WORKING ON 14 DIGITISING PROJECTS ACROSS SEVEN INDIAN PORTS


Cisco, the USA-based hi-tech company, has partnered with some of the largest Indian seaports and inland waterways to usher in an era of transformation by digitizing their processes.

The ports and waterways authorities that have come on board in this digitation drive include Visakhapatnam, Deendayal, Kolkata Port, and IWAI (Inland Waterways Authority of India).

Cisco has been working on 14 projects across seven ports in India, of which three projects have been completed, and 11 are in various stages.

Maritime Vision 2030

The partnership has been rolled out to enable India’s Maritime Vision 2030, which focuses on boosting the productivity and performance of the nation’s maritime sector over the next ten years.

The Indian Prime Minister, Mr. Narendra Modi, unveiled the Maritime India Vision (MIV) 2030 in March 2021 while inaugurating the three-day Maritime India Summit 2021, which had participants from 24 countries all over the world. A 10-year blueprint, the Maritime India Vision-2030, is drawn out to overhaul the Indian maritime sector. With a plan for Rs 3 lakh crore investment in the port project, the plan envisages generating employment for 20 lakh people.

Shipping and Waterway, it also promises to unlock annual revenue potential for major ports worth over Rs 20,000 crore,” according to the Ministry of Ports, Shipping and Waterway

Digitization – Four Key Focus Areas

Digitizing Indian ports and waterways can help reduce overall logistics cost while enhancing its competitiveness to transform it into a global manufacturing powerhouse

Cisco’s initiative to digitize ports and waterways is centered on four focus areas.

1.Improve turnaround time: Cutting down on turnaround is the first primary positive outcome. This will directly impact the capacity and revenue of the ports and inland water authorities.

2.Prevent the loss of revenue and equipment: Digitization enables real-time equipment monitoring, which helps in preventing loss of revenue and equipment failure.

3.Improve efficiency: Cisco also plans to help improve efficiency through energy management and analytics.

4.Employee safety and communications: Cisco is also increasing employee safety and communications through a multi-channel communication and collaborative platform.

Some of India’s largest ports are positioned to improve turnover times, prevent loss of revenue and equipment failures through real-time monitoring, increase efficiency through energy management, logistics, and improving employee communications and safety.

Dave West, president for the Asia Pacific, Japan, and Greater China (APJC) at Cisco, said, “India has a goal to be a manufacturing powerhouse. To get there, they need efficient logistics.

Cisco’s strategic partnership will help India move closer to becoming a $5 trillion economy by 2025. Even though the COVID crisis has affected the economy of the land, it has spurred a rethinking of what the future is likely to be. Dave West added, “Cisco will continue to play our part to help our customers leapfrog in this region.”

Source: www.itln.in, www.economictimes.indiatimes.com


THE INDIAN RAILWAYS DELIVER 150 TONNES OF OXYGEN IN 24 HOURS


Severe Shortage of Medical Oxygen

A severe shortage of medical oxygen was experienced by hospitals in the Indian states that were severely hit by the second wave of the COVID-19 pandemic. It also led to the loss of several precious lives. India has a sufficient supply of medical oxygen however, the unavailability of containers and tankers was the culprit behind the severe scarcity.

Within 24 hours, the oxygen Expresses of Indian Railways transported Liquid Medical Oxygen (LMO) tankers with over 150 tonnes of oxygen across the country amidst the severe shortage of medical oxygen in different parts of India. A total of 10 containers having nearly 150 tonnes of oxygen have been carried so far,” said the official press release by the Ministry of Railways.

The Oxygen Express by the Indian Railways

Railways ran the first oxygen express from Kalamboli in Maharashtra to Vizag in Andhra Pradesh and then back to Nasik in Maharashtra. With a distance of more than 1850 km between Kalamboli and Vizag, the railways were able to move the oxygen tankers within 50 hours.

To enable the smooth movement of oxygen supply, Indian Railways created ramps at stipulated places so that the liquid medical oxygen tankers could be moved easily. Seven tankers with more than 100 tonnes LMO were loaded in 10 hours and transported back to Nagpur within a short span of 21 hours.

“For the movement of Ro-Ro service, Railways had to map the entire route considering the various constraints like ghat sections, the road over bridges, tunnels, curves, platform canopies, overhead equipment, etc. at certain locations. Because height is an important aspect of this movement, Railways mapped the route via Vasai. The model of road tanker T1618 with a height of 3320 mm was found feasible to be placed on flat wagons. The longer route via Vasai was charted as Over Dimensional Cargo (ODC) is not permitted to travel in ghat sections over Mumbai division,” explained the official release by the Railway Ministry.

Severely affected states like Andhra Pradesh and Delhi had requested the Railways to operate more Oxygen Express trains. Liquid Medical Oxygen is filled in tankers at Visakhapatnam and Bokaro were transported through the Ro-Ro service of Indian Railways.

Indian Government Moves into Action

The Indian Prime Minister, Narendra Modi, chaired a high-level meeting to review steps taken to boost oxygen availability across the country. PM Modi emphasized the need for all ministries and departments to work in tandem to ensure the seamless supply of critical oxygen and medical supplies.

The Ministry of Finance announced, “The government of India has taken many measures in the last few days to improve the supply of oxygen and medical supplies. IAF planes are bringing in cryogenic oxygen tanks from Singapore. IAF is also transporting oxygen tanks in the country to reduce travel times.”

Green Corridor

As the Indian state of Uttar Pradesh also had a dire need to fulfill the requirements of medical oxygen in Uttar Pradesh, a green corridor was created between Lucknow to Varanasi for the movement of the train. The distance of 270 kilometers was covered by the train in 4 hours 20 minutes with an average speed of 62.35 km per hour.

Oxygen being cryogenic and hazardous, Indian Railways had to be extra cautious while transporting this vital lifesaving commodity. It is critical to avoid sudden acceleration or deceleration. To make sure that the movement happens without any incidents, the pressure had to be monitored at regular intervals, especially when the containers were filled and loaded.

Having taken it up as a challenge to be met during this dark hour in modern Indian history, the Indian Railway made meticulous preparations. For this purpose, the entire route was mapped, people were trained to transport the special tankers to the route that traversed through Vizag, Vasai, Nagpur, Bhusaval, and Surat.

The movement of oxygen over long distances is much better through trains as it can move much faster than road transport. While it can take up to three days by road, transportation through rail takes just two days. The time difference is because trains can run nonstop through the day and night while truck drivers need to take halts for rest and refreshment along the route.

Source: www.itIn.in


BLOCKCHAIN-ENABLED PRECIOUS METALS REFINERY AT DMCC, DUBAI


DMCC has announced signing a sale and purchase agreement (SPA) with REIT Development to establish the largest precious metals refinery and storage facility across the GCC. This refinery will be the first to be entirely enabled by blockchain in the GCC.

As part of the agreement, REIT Development has acquired industrial land strategically located in DMCC’s Jumeirah Lakes Towers (JLT) vibrant business district. The facility will refine and store precious metals, including gold, silver, platinum, palladium, and rhodium, which will be tokenized on goldexchange.com.

DMCC- the world’s flagship Free Zone

DMCC (Dubai Multi Commodities Centre) was established in 2002 by the Government of Dubai to provide the physical, market, and financial infrastructure required to establish a hub for global commodities trade. DMCC Free Zone is the largest Free Zone in the UAE, with more than 18,000 registered members as of 2021.

In 2018, DMCC was named the number one global free zone for a fourth consecutive year by the Financial Times.

DMCC is made for trade and has established Dubai as a leading center for trading international commodities. DMCC is also the world’s fastest-growing Free Zone. Promoting and facilitating trade across various goods from gold, diamonds, and precious metals to tea, food, and industrial materials, the DMCC is home to major multinationals and start-ups.

Gold Exchange DMCC

Gold Exchange DMCC is a secured trading platform. This platform will provide access to financial assets in stablecoins namely GoldCoin, SilverCoin, PlatinumCoin, PalladiumCoin, and RhodiumCoin.

Each Ethereum-based token will represent the current value of one gram of each metal and can be traded on the exchange. The tokens will be physically backed by the precious metals at DMCC’s secure storage facility, meaning they can be traded with confidence.

Ahmed Bin Sulayem, Executive Chairman and Chief Executive Officer, DMCC, said: “The gold and precious metals industry is at a tipping point, but without a doubt, there are boundless opportunities that lie beneath the uncertainty of a post-pandemic world.

He further emphasized, “The gold and precious metals industry is expected to witness significant growth in the coming period, and through similar agreements, we can advance the industry as a whole.”

Enabling Blockchain Technologies in Dubai

With the inking of this agreement with REIT Development, DMCC will continue to play a crucial role in pinpointing the UAE on the world map as a leader in the precious metals industry. Deployment of cutting-edge technology such as blockchain is the added advantage to the quotient.

In February 2021, Ahmed Bin Sulayem, the Executive Chairman of DMCC, and Jumeirah Lakes Tower joined the advisory board of the Swiss Government-supported blockchain investment company CV VC following an earlier agreement between DMCC and CV VC and CV Labs.

This partnership will bring a leading blockchain and cryptographic technologies ecosystem to Dubai.

First-of-its-kind facility by REIT Development

REIT Development is one of the leading organizations that is specialized in precious metals and blockchain technologies. This agreement is the first of its kind and will be completed in the last quarter of 2022. This new facility will strengthen DMCC’s position as a global hub for precious metals and a leader in technological advancements.

Mike De Vries, Chief Operation Officer, REIT Development, said: “Blockchain technology can enable more transparent and accurate tracking of precious metals, ensuring there is no ‘dirty gold’ in circulation and illicit trades.”

The 100,000 sqft precious metals refinery and storage will create a decentralized, immutable record of all transactions, making it possible to track all precious metals refined in our refinery and eventually sold internationally to over 150 countries. Customers who buy the products or use the storage can verify all the information in the blockchain.

This will set a precedent for metals trading of the future as blockchain will be the norm of the future. By the year 2025, it is predicted that every precious metals refinery and storage facility will be on a blockchain.

Paul Ashton, Executive Director – Property, DMCC, said: “The appeal of Dubai as a prime destination, combined with our world-class market infrastructure, state-of-the-art facilities, business-friendly environment and unparalleled investments in digital solutions, provide the ideal proposition for any business looking to grow and set operations in the region.”

Source: www.transportandlogisticsme.com, www.dmcc.ae


DEATH AND RESIGNATION


Rahat Talreja
Vice President – CSS India Operations

Yes, the topic is strange. At least the way it has been related. But do you know that resigning from a company has the same effect as a person’s death? Let’s evaluate.

Qualities of Death :

a) The person who dies suddenly becomes much greater than he was in real life. Or considered much worse than he was. Look around, and you will see the most prominent names in politics are either shown as super great or super useless, depending on which party the living person belongs.

b) Death brings along with it a sense of guilt to the living. Therefore they overcompensate by glorifying the deceased and crucifying those alive, almost to the extent of blaming them for the deceased’s problems and sometimes even calling them the reason for his death. A famous actor of Bollywood, who died last year, is experiencing this currently. None of his movies did as well, and suddenly once he passed away, supporters emerged from all holes, enough that if today he were alive, he would be bigger than any superstar, but when alive, he wasn’t even a fraction of the greatness by the same fans.

c) Victim mentality plays out within those living, and they start blaming the living powerful for their sorrows and empathizing with the dead. A man was always unhappy with his life and kept saying it’s better to die than to live like this. Then god heard him, and he died finally. But the moment he died, he started cribbing about the life of the dead. Roaming here and there over morgues, walking through doors without feeling them, being invisible to all living beings except their brethren and dogs ( who can see ghosts) So then god got confused and again gave them a rebirth. Since they came with so much misery, they already had health issues the moment they were born and caused great stress to their family from birth itself and again started cribbing about life and its better to be dead, so their cycle continued.

d) Those who die always have reasons like coronavirus, heart attack, grief, stress, cancer, etc, but that is what they focus on. What they forget are the several years they even lived. Death was just one moment, the rest of it was life. The focus suddenly is on the reasons for death. Till you were alive, god was great. When you die, god was mean.

Now let’s see the similar qualities when you resign or leave a company. You can compare with similar points above example a-a, b-b and can relate:

a) The person who resigns suddenly becomes greater than he was or considered worse than he was. The discussion revolves around how good he was by the naysayers within and how bad he was by the bootlickers within. The reality is that they existed with their good and bad when they worked for the company, and once they leave, the discussion is polarised, but the person isn’t. So futile to discuss.

b) After you resign, you have a sense of guilt, so you overcompensate it by glorifying the new company you join and crucifying the company you left. I once heard on youtube from the great investor Mr. Samir Arora of Helios Capital that: Warren Buffet decided to buy a company after reading 50 balance sheets over 50 years. This was regarded as a high conviction by all. But if it was a high conviction, why didn’t he buy it in the 49th year then. Why did he wait to read the 50th and only then buy? It is a case of no conviction since the rejection was 49 times. Similarly, if the new company you join is so great and the old one was bad, then why did you work for the old one for all these years?

c) A similar victim mentality plays out within the ones who are still working, who also are fed with the exiting employee’s negative pointers and their own anti-incumbency, and they start blaming in their hearts or private gossip- the management or boss for their grave sorrows and how they are enduring it with great pain. These people are similar to the dead than born, then dead, then born again type of livers.

d) Those who resign have several reasons like no growth, curtailment of their power pursuits, feeling worthless, primarily to hide their shortcomings and lack of sincere effort. So till they work and aren’t questioned, the boss is god. And when they are asked a little if they go astray, the boss is the devil.

So, friends, I hope you can read the overt and covert meaning of this article and walk on the path of true wisdom to reach a stage of neutrality where zero and infinity are the same, and you keep doing what’s required to be done without overthinking. Great leaders always follow this path!

 


UZBEKISTAN: A COUNTRY THAT IS RIPE WITH BUSINESS OPPORTUNITIES


The Republic of Uzbekistan has been opening up to the world in recent years. Uzbekistan has strengthened its relationships with foreign partners in trade, investment, innovation, green energy, tourism, and other fields on the path of dynamic economic development. Noted as the largest consumer market in Central Asia, Uzbekistan is on the way to accelerated growth.

Following the President of Uzbekistan Shavkat Mirziyoyev to the UAE in 2019, UAE has become an important trading partner of Uzbekistan. Both the countries signed a joint statement including inter-governmental, inter-departmental documents, and investment agreements to implement 11 collaborative projects.

Food Exports

The largest share of the Dubai-Uzbekistan non-oil market comprises the food market that involves the production and export of apricots, carrots, cherries, etc. In 2020, the figures showed a steady rise of AED.1.42 billion of food exports, pointing to Uzbekistan as a leader in this position. The country is also developing its logistics and transport corridors to supply Uzbek fresh, and processed fruit and vegetable produce.

The average annual growth rate of agriculture, forestry, and fishery production for 2016 to 2020 showed an increase of 2.6 percent, with 7.2 percent coming in from the agricultural sector alone. This resulted from the structural reforms and implementation of measures that helped support sustainable development and modernization of the agricultural sector.

The UAE company that strongly supports this venture is Abu Dhabi based Sura Holding. Sura Holding has invested in projects designed to modernize the agricultural scene in Uzbekistan. Several other UAE-based companies have invested in agricultural projects across Uzbekistan.

The Energy Sector

The high potential market segment that UAE has invested in Uzbekistan is energy. UAE’s investments in energy projects reflect a growing interest and confidence in the energy market.

During the Uzbekistan President’s visit to the UAE in March 2019, UAE agreed to develop a 500-Megawatt wind farm project in Uzbekistan. This project was set to be developed by Masdar. Later in April 2021, the 500-megawatt project increased its capacity to 1.5-gigawatts.

In December 2020, Masdar completed its financial closure of the first PPP project, the Nur Navoi Solar Project. In recent news, the Dubai-based Phanes Group has inked a power purchase agreement and Investment agreement for a 200 MW grid connector solar PV plant in Uzbekistan that includes technical and commercial terms for building owning and operating a 200MWAC solar PV project including facilities connecting to Khimiya 220/110 kV substation.

Frontiers for Tourism

Uzbekistan has developed the regulatory framework for modernizing and expanding its tourism industry. Some of the plans laid down include introducing halal certification, training of halal tourism guides, and construction of halal hotels.

With the implementation of visa-free tourism in 2018 for Indonesia, Malaysia, and Turkey, tourists can come over to visit the Muslim shrines of the country without any hassles.

In 2019, the visa-free allowance was extended to UAE citizens and residents, which will positively facilitate business and tourism exchange between the two countries in the post-COVID years to come.

Retail Opportunities

Interestingly, UAE’s retail giant, the Majid Al Futtaim (MAF) Group, has already established its footing in Uzbekistan by opening several Carrefour supermarkets in Tashkent. The entry of the region’s leading mall operator highlights the retail sector’s potential in the country for UAE companies.

This move is an indication that the retail market in Uzbekistan is ready to be tapped. UAE-based retail companies can maximize the opportunities and play a crucial role in developing modern retail in the country and creating value for the industry and the Uzbek economy.

UAE-Uzbekistan – A Win-Win Partnership

The Expo 2020 in Dubai is ideal for Uzbekistan’s economic potential as Uzbek companies leverage the platform provided to market the Uzbek potential to a world audience.

The country’s embassy in the UAE will continue to work closely with public and private sector stakeholders to ensure that bilateral relations continue developing and flourishing. The Government-led reforms have brought positive changes to the nation’s business landscape, with the retail sector seeing growth from foreign investors and multi-national companies.

Source: www.transportandlogisticsme.com


IS DEMURRAGE AN EXCLUSIVE REMEDY FOR THE SHIP-OWNERS IN THE EVENT OF DETENTION?


cssSitting in the Commercial Court division of the High Court of England & Wales, Andrew Baker J aptly stated, “From time to time, a case provides the opportunity to resolve a long-standing uncertainty on the point of law of significance in a particular field of commerce.” The Eternal Bliss is certainly such a case.

In the case of K Line Pte Ltd v Priminds Shipping (HK) Co Ltd – The Eternal Bliss, where the ship (Owned/operated by K Line) on voyage charter under (Priminds Shipping) was delayed at the discharge port in China for 31 days due to alleged congestion or possibly lack of storage space ashore for the cargo of soybeans, due to which, the condition of the cargo deteriorated.

K-Line settled the receivers’ and their insurers’ claims at a total cost of about U$1.1 million and commenced proceedings against Priminds (Charterers) seeking indemnity in respect of that cost and for failure to discharge the subject cargo at the rate (within contractual laytime).

It is well-established that demurrage is by nature liquidated damages for failing to discharge at the required rate, but in that respect what does demurrage, calculated in accordance with the voyage charter, fix or limit the owner’s recovery?

In Reidar v Arcos1 and Suisse Atlantique2, it was held that, if damages in addition to demurrage are to be recovered, it is necessary to show a breach of a separate obligation as well as damage of a different kind from delay in the completion of the loading and discharging operation. However, Andrew Baker J held that it is unnecessary to prove a separate breach to recover damages in addition to the detention of the ship, i.e. demurrage and quoted “Agreeing a demurrage rate gives an agreed quantification of the owner’s loss of use of the ship to earn freight by further employment in respect of delay to the ship after the expiry of laytime, nothing more. Where such delay occurs, the demurrage rate provides an agreed measure by which the parties are bound for the owner’s claim for damages for detention, but it does not seek to measure or therefore touch any claim for different kinds of loss [emphasis added], whatever the basis for any such claim.”

The judgment by Andrew Baker J contains a forensic analysis of the cases and legal commentary on the issue, and in summary, held that “demurrage is not and/ or should not be the exclusive compensation where failure to load within the contractual laytime has consequences other than the detention of the ship,” and therefore, where a ship-owner has suffered a different type of loss arising from a failure to load or discharge the vessel within laytime (such as cargo claim liabilities) there should be no need for the owner to establish a separate and independent breach of contract to recover damages in addition to demurrage.

The decision has brought some delight to vessel owners, but it has yet to be determined since the Charterers have been granted permission to appeal to the Court of Appeal.

 


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