Contract of Affreightment
A Contract of Affreightment is a contract between a cargo shipper and carrier for the transport of multiple cargoes over a period of time. Contracts are individually negotiated and usually include cargo description, quantities per shipment and in total, load and discharge ports, freight rates and duration of the contract.
The charterer is obligated to pay for any delays in the delivery of the goods even if they are ready to be transported. The carrier on the other hand is only responsible for delays if they are due to faults in the ship itself.
The terms of the contract outline the obligations, rights, and responsibilities of the charterer and shipowner. Some obligations include: the charterer must provide the vessel with a clean bill of lading, proper notice of readiness to load, and correct quantities and description of cargo.
The contract can be terminated by either party with written notice, but if it is terminated by the charterer, they are still responsible for any costs incurred up to that point.
It is understood that the ship must be seaworthy when the contract between the shipowner and charterer is drawn up. The seaworthiness of the vessel is the responsibility of the shipowner, not the charterer.
The shipowner commits to sticking to the routing, schedules, and delivery times set out in the contract. The shipowner is also responsible for providing a safe port for the discharge of cargo.
The charterer pays the shipowner for the use of the vessel and is responsible for any delays in delivery, even if the vessel is ready to be transported. The carrier is only responsible for delays if they are due to faults in the ship itself.
A contract of affreightment is a legally binding agreement between a cargo shipper and carrier that outlines the terms and conditions of multiple shipments of cargo over a set period of time. This type of contract is individually negotiated and typically includes information such as:
- Cargo description
- Quantities per shipment and in total
- Load and discharge ports
- Freight rates
- Duration of the contract
The charterer is responsible for paying any delays in the delivery of the goods, even if the vessel is ready to transport them. The carrier, on the other hand, is only liable for delays if they are due to faults in the ship.
Related Links
Affreightment
Contract of Affreightment
Long Term Contracts of Affreightment – Matrix Maritime Services
Contract of Affreightment Definition – Operations & Supply Chain Dictionary
Types of Charter – Tutorial; Types of Charter – Tutorial
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