Although it seems questionable what measures Russia could in fact take, the latest threat from Russia will raise new factual and legal questions for all stakeholders in maritime shipping, such as owners, charterers, carriers and cargo interests.
Besides ensuring the safety of the crew, the vessel, and the cargo, the focus will be on how to mitigate financial and legal risks and who is authorised to take decisions in this context. Owners, charterers, shippers, and insurers will not always have the same interests.
Should, for example, a decision be made for European merchant vessels to avoid certain regions and waterways as a precautionary measure and to take detours instead, this will have a direct impact on supply chains. This effect is familiar from other recent examples – the blockage of the Suez Canal by the “EVER GIVEN,” the Houthi attacks in the Southern Red Sea, and the blockade of the Strait of Hormuz.
Rerouting regularly results in longer transit times and higher costs. The latter are often passed on along the carrier chain to the consignor or shipper. Whether this is legally justified depends primarily on the respective contractual (price adjustment) provisions agreed upon in the individual contracts within the carrier chain. The same applies to liability for delay in delivery. The current situation once again highlights how important it is for a contracting party that enters into both an “upstream” and a “downstream” contract within the carrier chain to ensure that the terms of these agreements are consistent. Otherwise, that party runs the risk of having to bear additional costs or being held liable for the consequences of the delays without being able to pass these costs or liability on within the contractual chain.
Various issues related to force majeure, as well as criteria relevant to liability like the carrier’s standard of care, inevitability, and unforeseeability, will also have to be specifically evaluated in light of the new situation.
Similar issues will arise if Putin’s threat materializes and a western vessel is seized or factually confiscated – either because the vessel was not rerouted or even though she was rerouted, which could make her appear “suspicious” in the first place. It is foreseeable that sham inspections, ostensible grounds for suspicion, and measures taken under the guise of legality can lead to significant problems in the contractual allocation of risk.
Since the economic and legal circumstances can vary significantly from vessel to vessel, cargo to cargo, and route to route, a standard will not be established in the short term. Hence, risk analysis and contractual safeguards are the order of the day.
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