Updated BIMCO contracts for towage and barge hire

Updated BIMCO contracts for towage and barge hire

The Baltic and International Maritime Council (BIMCO) recently published new editions of the widely used Towhire, Towcon and Bargehire contract forms, which were last revised in 2008. The amendments are intended to improve legal clarity and bring the contracts more in line with current commercial practices.

Towhire and Towcon are the industry standard ocean towage agreement. Both contracts have undergone revisions, including rearranging the layout as well as amending certain principle terms, as discussed below.

The party’s liability regime now includes definitions of "Hirer's Group" and "Tugowner's Group". The forms also include a new definition of "Place of Connection" to address cases where the tow is located inside a port area which may take several hours to reach. In Clause “Towing Gear and Use of Tow’s Gear” in part of hirer's responsibility to pay for repair or replacement of damaged or lost towing gear there are amendments due to which the hirer should pay only for gear and accessories provided by the Tugowner and used in connection with an Agreement. The box part also contains clause referring to daily reporting from Tugowner.

The contract now includes an “Insurance” clause, pursuant to which, the parties are obliged to warrant that the tug and the tow are insured, with protection and indemnity (P&I) insurance equivalent to the cover provided by members of the International Group of P&I Clubs as the benchmark. Some new clauses modelled on existing BIMCO have also been included, addressing infectious or contagious diseases, piracy, anti-corruption, sanctions.

The amendment made only to the Towcon form is “Free Time/Delay Payments” clause, where a provision has been made for bunkering the tug during the voyage. There is now a box for the tug owner to state the estimated average towage speed, which can be used as basis for calculating the compensation for extra time, to reduce the risk of disputes surrounding the calculation of compensation owed to the tug owner to cover delays due to slow steaming and deviation.

Some commonly found BIMCO clauses have been also introduced in Bargehire 2021.

The clauses dealing with survey, repair and redelivery have been given particular attention and extension. Other changes include a new and combined clause on ballasting operations and a default obligation on the charterers to take out P&I insurance.

All amendments have been introduced to make the proforma easier to understand and more user friendly and it is supposed that the 2021 editions of these contracts will become market standards.