3.2 The Private Law Dimension: Commercial Problems
Generated by the Ukraine Sanctions Regime
If the ports of the Crimea are “officially closed” by Ukraine since May 2014 but
practically still open and maintained by Russia—which burdens does the law place
on those seeking to disobey the Ukrainian closure and to defy the surrounding
sanctions regimes? There is varying case law applicable in this area, centred on
the question what could render a port unsafe, in the absence of any “classic”
navigational risks, and what constitutes a “war” as opposed to other politically
sensitive situations involving a potential for hostilities.
3.3 Are the Five Closed Crimean Ports Politically Unsafe
Ports?
Under charter parties, one of the key legal obligations of the charterer is to direct the
ship only to ports, which, at the time the order is given, are assumed to be safe. To
that end, the contracts may contain express or implied safe port warranties. An
authoritative legal definition of what constitutes a safe port has been established
already since 1958, as part of the proceedings in The Eastern City
56
: It reads—“A
port will not be safe unless, in the relevant period of time, the particular ship can
reach it, use it and return from it without, in the absence of some abnormal
occurrence, being exposed to danger which cannot be avoided by good navigation
and seamanship.”
Where charterers nominate an unsafe port, owners are entitled to reject that
nomination on the basis that it is invalid. In the event that a valid nomination is
made but, prior to the arrival of the vessel the port becomes unsafe, under a time
charter, the charterer will be obliged to nominate a new port.
57 However, under a
voyage charter, the position is less clear, particularly if it is combined with the exact
terms of a bill of lading. Unless the charter party specifically provides for it, the
charterer may not be able to change its nomination without the express consent of the
owner.
58 That is why some voyage charters include so-called “near clauses” providing that a vessel shall proceed to the nominated port “. . .or so near thereto as she may
safely get. . .”
59
56 Leeds Shipping v. Bunge (The Eastern City) [1958] 2 Lloyds Rep 127.
57 See Girvin (2011), p. 21.40.
58 Eder et al. (2011), art. 82, note 9-015.
59 See for example GENCON 94, clause 1: “The said Vessel shall, [. . .], proceed to the loading port
(s) or place(s) stated in Box 10 or so near thereto as she may safely get and lie always afloat, and
there load a full and complete cargo [. . .] as stated in Box 12, [. . .], and being so loaded the Vessel
shall proceed to the discharging port(s) or place(s) stated in Box 11 as ordered on signing Bills of
Lading, or so near thereto as she may safely get and lie always afloat, and there deliver the cargo.”
Sanctions Compliance Risks in International Shipping: Closure of Five. . .
303
Generated by the Ukraine Sanctions Regime
If the ports of the Crimea are “officially closed” by Ukraine since May 2014 but
practically still open and maintained by Russia—which burdens does the law place
on those seeking to disobey the Ukrainian closure and to defy the surrounding
sanctions regimes? There is varying case law applicable in this area, centred on
the question what could render a port unsafe, in the absence of any “classic”
navigational risks, and what constitutes a “war” as opposed to other politically
sensitive situations involving a potential for hostilities.
3.3 Are the Five Closed Crimean Ports Politically Unsafe
Ports?
Under charter parties, one of the key legal obligations of the charterer is to direct the
ship only to ports, which, at the time the order is given, are assumed to be safe. To
that end, the contracts may contain express or implied safe port warranties. An
authoritative legal definition of what constitutes a safe port has been established
already since 1958, as part of the proceedings in The Eastern City
56
: It reads—“A
port will not be safe unless, in the relevant period of time, the particular ship can
reach it, use it and return from it without, in the absence of some abnormal
occurrence, being exposed to danger which cannot be avoided by good navigation
and seamanship.”
Where charterers nominate an unsafe port, owners are entitled to reject that
nomination on the basis that it is invalid. In the event that a valid nomination is
made but, prior to the arrival of the vessel the port becomes unsafe, under a time
charter, the charterer will be obliged to nominate a new port.
57 However, under a
voyage charter, the position is less clear, particularly if it is combined with the exact
terms of a bill of lading. Unless the charter party specifically provides for it, the
charterer may not be able to change its nomination without the express consent of the
owner.
58 That is why some voyage charters include so-called “near clauses” providing that a vessel shall proceed to the nominated port “. . .or so near thereto as she may
safely get. . .”
59
56 Leeds Shipping v. Bunge (The Eastern City) [1958] 2 Lloyds Rep 127.
57 See Girvin (2011), p. 21.40.
58 Eder et al. (2011), art. 82, note 9-015.
59 See for example GENCON 94, clause 1: “The said Vessel shall, [. . .], proceed to the loading port
(s) or place(s) stated in Box 10 or so near thereto as she may safely get and lie always afloat, and
there load a full and complete cargo [. . .] as stated in Box 12, [. . .], and being so loaded the Vessel
shall proceed to the discharging port(s) or place(s) stated in Box 11 as ordered on signing Bills of
Lading, or so near thereto as she may safely get and lie always afloat, and there deliver the cargo.”
Sanctions Compliance Risks in International Shipping: Closure of Five. . .
303