CILT International Diploma in Logistics and Transport - Module 4: Transport Planning - Shipping Law

Introduction

Seventy-one percent of Earth’s surface is sea waters with an average depth of $3800$ meters ( $12470$ ft), with shallow continental shelf waters constituting only five percent.
Ancient maritime trade existed long before formalized international law. It was governed by mutually accepted norms, practices, and customs developed among seafaring nations and trading communities.
The doctrine of “Acts of God” prevailed to preserve voyages and carriage of goods. This recognized that certain maritime losses were due to natural causes beyond human control, affecting liability and insurance.
The 17th-century doctrines became inadequate in the 20th century as they were conventions, not legally enforceable. These principles guided maritime activities but lacked the force of law needed for complex, modern scenarios.
After World War II (1939-1945), regulation of territorial jurisdiction, sea resources, customs, voyage risks, perils, carriage terms, and uniformity became necessary. The war highlighted the need for international cooperation and standardized maritime laws to ensure safety, security, and efficient trade.

Law of the Sea

United Nations Conference on the Law of the Sea (UNCLOS)
- Comprehensive framework governing maritime activities.
Jurisdictions over the sea and resolving international disputes
- Defines rights and responsibilities of nations in the oceans.
Exclusive Economic Zone (EEZ)
- Extends coastal state control over marine resources.
International Maritime Organisation (IMO)
- Specialized U.N. agency for maritime safety and security.
Offshore oil and gas
- Regulation and exploitation of seabed resources.
Panama Canal & Panamax vessels, Suez Canal
- Strategic waterways affecting global trade.
Oceans & Seas
- Physical characteristics, biodiversity, and ecological importance.
Perils of the Sea and Maritime Perils
- Risks and hazards associated with maritime activities.

UNCLOS (United Nations Conference on the Law of the Sea)

The first U.N. Conference on the Law of the Sea was in $1958$ , primarily addressing territorial waters and fishing rights.
The second Conference was in $1960$ , but failed to resolve key issues such as the breadth of the territorial sea.
Further Conferences occurred in $1973$ and $1982$ , leading to the comprehensive UNCLOS treaty, which defines maritime zones, establishes navigation rights, and addresses environmental concerns. The Exclusive Economic Zone became International Law in $1994$ , granting coastal states rights over marine resources up to 200 nautical miles from their baselines.

Maritime Zones

Internal Waters: Land to Baseline
- Includes all waterways on the landward side of the baseline.
Territorial Sea: $12$ nautical miles ( $22.224$ km) from the baseline.
- Coastal states have sovereignty, including the right to regulate passage.
Contiguous Zone: $12$ nautical miles from the territorial sea.
- States can enforce laws regarding customs, immigration, and sanitation.
Exclusive Economic Zone (EEZ): $200$ nautical miles ( $370.40$ km) from the baseline.
- Coastal states have rights to manage resources and economic activities.
International Waters: Outside Territorial Waters.
- Also known as the high seas, where all states have freedom of navigation, fishing, and research.
$1$ nautical mile (international) = $1.852$ kilometers

Jurisdictions Over the Sea

Territorial waters and the Contiguous Zone
- Coastal states exercise sovereignty and jurisdiction.
Continental Shelf
- Rights to explore and exploit natural resources on the seabed and subsoil.
High Seas: Fishing and conservation of living resources
- International cooperation for sustainable management.
Regulation of navigation
- Ensuring safety and preventing collisions at sea.
Prevention of marine pollution and other environmental issues
- Measures to protect the marine environment from degradation.

Exclusive Economic Zone (EEZ)

Established under the “United Nations Conference on the Law of the Sea.”
- Provides a framework for coastal states to manage marine resources.
Has a profound effect on the exploitation of ocean resources
- Balances economic interests with conservation efforts.
Coastal state has full sovereign rights over its territorial waters, extending $12$ nautical miles ( $22.2$ KM) offshore.
- Includes control over navigation, fishing, and resource exploitation.
Jurisdictional rights to exploit the seabed and manage resources in the water, oil, and gas deposits beneath the seabed over an area extending $200$ nautical miles ( $370$ km) ashore.
- Enables coastal states to benefit from offshore resources while promoting sustainable practices.
$87$ % of known hydrocarbon reserves and the majority of fish stocks are within the EEZ.
- Highlights the economic significance of the EEZ for coastal states.
Coastal states have responsibilities to limit pollution and other environmental hazards.
- Promotes responsible stewardship of marine ecosystems.
Right of innocent passage to shipping through EEZs must be allowed.
- Ensures freedom of navigation for international trade and commerce.

International Maritime Organisation (IMO)

Established in $1958$ as a special agency of the U.N.
- Originally named the Inter-Governmental Maritime Consultative Organization (IMCO).
Aims for improvement of maritime safety and prevention of pollution from Ships.
- Sets standards and regulations for ship design, construction, and operation.
Focuses on the International Convention for the Safety of Life at Sea.
- Addresses a wide range of maritime safety issues, including navigation, communication, and emergency procedures.
Deals with determination of load lines and measuring the tonnage of ships.
- Ensures ships are not overloaded and comply with stability requirements.
Regulates the transportation of dangerous goods.
- Establishes standards for packaging, labeling, and handling hazardous materials.
Focuses on the adoption of conventions for addressing sea-related issues, such as the Safety of Life at Sea (SOLAS).
- Regularly updates conventions to address emerging challenges and technological advancements.
Deals with International Regulations for preventing collisions at sea, including definitions, applications, and responsibilities.
- Provides rules for navigation and collision avoidance to enhance maritime safety.

General Average & The York Antwerp Rules

General average, particular average
- Principles for sharing losses in maritime adventures.
Application of York Antwerp
- Standardized rules for adjusting general average claims.

Going Dutch

"Going Dutch" means each person covers their own expenses in a group activity, rather than one person paying for all.

General Average Situations

Scenario: A cargo hold has a fire; seawater is pumped in, dousing the fire but damaging some cargo, while saving the rest of the cargo and the ship.
The decision to expend money on salvage or sacrifice cargo in one hold was INTENTIONAL.
The Decision was at a time when the vessel was in PERIL and for the interest of more that one was involved in

a common maritime adventure which involved the Shipowners and the Cargo owners

General Average Key Questions

There is a fire on board
Sea water is pumped into the cargo hold
Sea water Extinguishes the fire
The cargo in the cargo hold is a total loss
But the SHIP & the OTHER CARGOES are safe
Using the Salvors and filling the cargo hold with sea water was INTENTIONAL – It was taken at a time of PERIL and for the interest of

more than one involved in a common maritime adventure which would have affected more than one party like cargo owners and the

ship owners

Now the Question arises :-
WHO WILL PAY FOR THE SALVORS FEE
Or
WHO WILL PAY FOR THE CARGO LOST DURING THE FLOODING OF THE CARGO HOLD
There was other cargoes which was saved and the complete ship which was saved while an expense was made when everyone was involved; thus when everyone profited from it they must also share the losses
These are the types of cases when General Average is calculated

General Average Principles

Using this principle of General Average it is calculated how much each particular party

who has profited share in this particular loss

Two main principles derived:- FIRSTLY, if a common adventure is exposed to a common danger during a voyage, the costs of extraordinary sacrifices and expenditures necessary to protect the involved interest from the peril shall be apportioned according to the value of the interest (The common safety principle).

General Average Costs

SALVAGE EXPENSES
DAMAGE FROM BEACHING A LEAKING SHIP TO PREVENT IT FROM SINKING
JETTISON OF CARGO TO REFLOAT A GROUNDED SHIP
Example of such cost include the following: THE EVERGIVEN STUCK AT THE SUEZ CANAL THE EVERFORWARD STUCK AT CHESAPEAKE BAY – USA

General Average Benefit Principle

SECONDLY, expenses incurred for the common benefit of the common maritime adventure may also be allowed in General Average despite their not being necessary to avoid the PERIL (the Common benefit principle).- Examples include expenses for unloading and storing cargo while the ship is being repaired in a port of refuge so that the voyage can be completed.

General Average Sacrifice

GENERAL AVERAGE IS BASED UPON THE PRINCIPLE THAT WHICH HAS BEEN SACRIFICED FOR THE BENEFIT OF ALL SHALL BE MADE GOOD BY THE CONTRIBUTION OF ALL

York Antwerp Rules

The York Antwerp Rules define & create rules for General average – they set the guidelines of which all sacrifices and expenditures can be included in the general average and which all cannot
They provide guidelines on which all sacrifices and expenditures can be included in the general average and which all cannot

Conditions for a General Average Act

Extraordinary Sacrifice or Expenditure
Intentional Sacrifice or Expenditure
For the Common Safety
There must be a peril

General Average Definition

The law of general average is a legal principle of maritime law according to which all parties in a sea venture proportionally share any losses