Commercial Shipping M11

1
Commercial Shipping (M11)

• Learning objectives
• Explain the purpose of key maritime organisations
• Describe how these organisations impact upon the
  business of commercial shipping
• Differentiate between the types of organisations

2
Commercial Shipping (M11)

• International diplomatic organisations
• United Nations Convention on the Law of the Sea
  (UNCLOS)
• International Maritime Organisation (IMO)
• United Nations Conference on Trade and
  Development (UNCTAD)
• Commercial organisations
• Baltic Exchange
• The Baltic International Freight Futures and
  Options Exchange (BIFFEX)
• Baltic International Marine Council (BIMCO)
• Insurance
• Representative organisations
• International Association of Classification
  Societies (IACS)
• The International Chamber of Shipping (ICS)
• International Transport Workers Federation (ITF)
• International Association of Ports and Harbours
  (IAPH)
• International Association of Independent Tanker
  Owners (INTERTANKO)

3
Commercial Shipping (M11)

• International diplomatic organisations
• United Nations Convention on the Law of the Sea
  (UNCLOS) was opened for signature on 10 December
  1982 in Jamaica and entered into force on 16
  November 1994.
• Key features
• coastal states sovereignty over their
  territorial sea
• transit passage of ships and aircraft of all
  countries
• archipelago states sovereignty over a sea area
• sovereign rights over the exclusive economic zone
  (EEZ) with respect to natural resources and
  certain economic activities

4
Commercial Shipping (M11)

• UNCLOS
• the exercise of jurisdiction over marine science
  research and environmental protection
• freedom of navigation and over-flight in the EEZ
• rights of land-locked and geographically
  disadvantaged states to participate on an
  equitable basis in exploitation of an appropriate
  part of the surplus of the living resources of
  the EEZs of coastal states
• coastal states sovereign rights over the
  continental shelf

5
Commercial Shipping (M11)

• International Maritime Organisation (IMO)
• IMOs Conventions
• International Convention on Safety of Life at Sea
  (SOLAS)
• International Convention on Load Lines
• International Convention on Tonnage Measurement
  of Ships
• Convention on International Regulations for
  Preventing Collision at Sea (COLREG)
• International Convention on Safe Containers

6
Commercial Shipping (M11)

• IMOs Conventions
• Convention on the International Maritime
  Satellite Organisation (Inmarsat)
• Convention on Standards of Training,
  Certification and Watchkeeping for Seafarers
  (STCW)
• International Convention on Maritime Search and
  Recue (SAR)
• International Convention for the Prevention of
  Pollution from Ships (MARPOL)
• International Convention on Oil Pollution
  Preparedness, Response and Co-operation (OPRC)

7
Commercial Shipping (M11)

• IMOs Codes
• International Maritime Dangerous Goods Code (IMDG
  Code-1965)
• Code of Safe Practice for Solid Bulk Cargoes (BC
  Code-1965)
• International Code of Signals (1965)
• Code for the Construction and Equipment of Ships
  Carrying Dangerous Chemicals in Bulk (BCH
  Code-1971)
• Code of Safe Practice for Ships Carrying Timber
  Deck Cargoes (1973)
• Code of Safety for Fishermen and Fishing Vessels
  (1974)

8
Commercial Shipping (M11)

• IMOs Codes
• Code for the Construction and Equipment of Ships
  carrying Liquefied Gases in Bulk (1975)
• Code of Safety for Dynamically Supported Craft
  (1977)
• Code for the Construction and Equipment of Mobile
  Offshore Drilling Unit (MODU Code -1979)
• Code on Noise Levels on Board Ships (1981)
• Code of Safety for Nuclear merchant Ships (1981)

9
Commercial Shipping (M11)

• IMOs Codes
• Code of Safety for Special Purpose Ships (1983)
• International Gas Carrier Code (IGC Code-1983)
• International Bulk Chemicals Code (IBC Code-1983)
• Code of Safety for Diving Systems (1983)
• International Code for the Safe Carriage of Grain
  in Bulk (International Grain Code-1991)
• International Safety Management Code (ISM
  Code-1993)
• International Code of Safety for High-Speed Craft
  (HSC Code-1994)
• International Life-Saving Appliance Code (LSA
  Code-1996)

10
Commercial Shipping (M11)

• United Nations Conference on Trade and
  Development (UNCTAD 1964)
• Principal functions
• the promotion of trade between countries in
  different stages of development and with
  different economic systems
• the initiation of action for the negotiation of
  trade agreements and the formulation of
  international trade policies.
• UN Convention on Code of Conduct for Liner
  Conferences (1974)
• UN Convention on International Carriage of Goods
  by Sea (1978)
• UN Convention on International Multimodal
  Transport of Goods (1980)
• UN Convention on Conditions for the Registration
  of Ships (1986)
• UN Convention on Maritime Liens and Mortgages
  (1993)

11
Commercial Shipping (M11)

• Commercial organisations
• Baltic Exchange
• The Baltic Dry Index (BDI) is
• the average of the Baltic Handy Index (BHI)
• the Baltic Panamax Index (BPI) and
• the Baltic Capesize Index (BCI).
• The BDI provides a good general indicator of
  movement in the dry bulk market and continues the
  established time series of the Baltic Freight
  Index (BFI) which was introduced in 1985.

12
Commercial Shipping (M11)

• Commercial organisations
• Baltic Exchange
• The Baltic Handy Index (BHI) is calculated from
  the weighted average rates on major time-charter
  routes, with two trial voyage routes, as assessed
  by a panel of brokers.
• The Baltic Panamax Index (BPI) is calculated from
  the weighted average rates on major routes, both
  voyage and time-charter, as assessed by a panel
  of brokers.
• The Baltic Capesize Index (BCI) is calculated
  from the weighted average rates on major routes,
  both voyage and time-charter, as assessed by a
  panel of brokers.

13
Commercial Shipping (M11)

• The Baltic International Freight Futures and
  Options Exchange (BIFFEX)
• BIFFEX offers shipowners and operators,
  charterers, traders and brokers a means of
  protecting themselves against the risks and
  volatility of dry bulk carrier freight rates by
  utilising such future contracts.
• All contracts traded on the BIFFEX market are
  settled in cash and not by physical shipments,
  based on an average of the Baltic Panamax Index
  over the last seven days of the settlement month.
• The Index is traded on BIFFEX for specified
  future settlement months (up to 18 months ahead)
  by negotiation between a willing buyer and a
  willing seller.

14
Commercial Shipping (M11)

• Baltic International Marine Council (BIMCO)
• The worlds largest organisation of shipowners,
  brokers, agents, PI Clubs and other companies
  with an interest in shipping, with over 2700
  members in 110 countries with 449.3 million dwt.
• BIMCOs aim is to unite shipowners and to defend
  the interests of international shipping at large.
  Members may draw on BIMCO for information and
  guidance on matters relating to port calls,
  document-related problems, technical issues and
  other practical shipping matters.
• BIMCO is the acknowledged centre for the
  development of shipping documents such as
  charter-parties, bills of lading and others.
  BIMCOs subsidiary companies produce and sell
  publications on practical shipping matters and
  professional shipping software.

15
Commercial Shipping (M11)

• Insurance
• Protection and Indemnity (P I) clubs
• The full range of risks covered by the PI clubs
  include crew, stevedore and third party death and
  injury and other crew liabilities, collision
  liabilities, damage to docks, pollution, removal
  of wreck (all of which are protection risks),
  loss of or damage to cargo, ships proportion of
  General Average, customs penalties and many types
  of fine (indemnity risks).
• Corporation of Lloyds (hull and machinery
  insurance)

16
Commercial Shipping (M11)

• Representative organisations
• International Association of Classification
  Societies (IACS)
• The International Chamber of Shipping (ICS)
• International Transport Workers Federation (ITF)
• International Association of Ports and Harbours
  (IAPH)
• International Association of Independent Tanker
  Owners (INTERTANKO)