Web Alert: Revised Supplytime 2017 approved for adoption by BIMCO
13 June 2017
Supplytime 2005 is designed to charter offshore support vessels in the oil and gas sector. The knock-for-knock liability and indemnity regime in the contract (‘knock-for-knock’) provides a clear risk allocation with the aim of minimising the number of disputes and reducing insurance costs. However it has been perceived in the offshore industry to be too favourable to Owners.
On 6 June 2017 BIMCO’s Documentary Committee adopted the revised Supplytime 2017. The revision was carried out by representatives from Owners, Charterers, brokers, insurers and legal interests and has taken over two years to complete.
The aim of the revision was to make the contract more balanced between Owners and Charterers, strengthen its knock-for-knock, update it so that it reflects current offshore industry practice and clarify its language so that it is more readily understandable to non-native English speakers.
The scope of the contract i.e. to charter offshore support vessels, remains unchanged following its revision. Although it is used for a variety of other purposes e.g. offshore installation operations, it was acknowledged by the revision subcommittee that the contract would become too complicated if it was expanded beyond its core use.
The definition of the Charterers Group has been broadened in Supplytime 2017 so that it includes Charterers clients (of any tier) and their affiliates, co-venturers and contractors and sub-contractors of any tier, so that all parties working at the offshore site are covered under the knock-for-knock regime. The exclusion for consequential losses has also been amended so that direct as well as indirect losses are excluded under the knock-for-knock, whereas only indirect losses were excluded in Supplytime 2005.
The knock-for-knock has also been strengthened in Supplytime 2017 by removing most of the exceptions to it, including the indemnity provided by Charterers for damage caused to the vessel due to the carriage of dangerous cargoes or the supply of unsuitable fuel. The General Average and New Jason clause and Both-to-Blame clause have also been removed because they undermine the knock-for-knock.
The revised Supplytime 2017 is a fairer and more balanced contract than Supplytime 2005 and it should provide our shipowner members with greater certainty regarding the scope of the indemnity provided by Charterers under the knock-for-knock regime. The new Supplytime 2017 will be published shortly by BIMCO.
Ursula O’Donnell was a member of the BIMCO Supplytime 2005 revision subcommittee.