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UpdateWikborg Rein’s Shipping Offshore:

The new Norwegian Ship Safety Act

- The seaworthiness concept to be replaced by safety management system

Managing offshore project risk | The new Competition Act in Singapore How to make sure your closing goes right | Right to lien on cargo under Chinese law | Classification society liability

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PUBLISHER: Wikborg Rein EDITORIAL STAFF: Gaute Gjelsten, Herman Steen, Stephen N. Lamb DESIGN: Lise Røed PRINT: HBO

ContentsUPDATE 1/2006

An exciting time to be a shipping lawyer 3 Top ten reasons closings go wrong – and how to make sure yours goes right 4

The new Norwegian Ship Safety Act 6 Norwegian Accident Investigation Board to investigate accidents at sea 8

Classification society liability 9 Safety at sea and marine insurers’ duty of confidentiality 10

The shipboker’s right to commission - change of broker channel 11Managing offshore project risk 12

Right to lien on cargo under Chinese law 14International conventions ratified by China 16

Voice recording using voyage data recorders 17 Notice of readiness under voyage charters 18

The impact of the new Competition Act in Singapore on international shipping 20 Wikborg Rein’s Shipping Competition Law Team 22

EU Commission moving forward on the repeal of exemption for the shipping industry 23 The Maritime Trainee Programme 24

Personnel news 25 Wikborg Rein’s Shipping Offshore Group in Bergen 26

AN ExCITING TIME TO BE A ShIPPING LAWyER It is an exciting time to be a shipping lawyer at Wikborg Rein. 2005 was one of our busiest years ever in the firm’s Shipping Offshore department and 2006 holds great promise to be equally challenging.

I have always believed that being a good lawyer was as much about preventing problems as it was about resolving them after they occur. The article on page 4 is a good example of that principle. Every day -- somewhere in the world -- a Wikborg Rein lawyer is working to make sure that an upcoming closing for a ship sale and purchase or lease-back goes smoothly. It is a mainstay of our work and the article draws on our collective experience to outline the most common snags and shoals and how best to avoid them.

While recent years have seen the shipping industry benefit from good economic times, this success has also, and not surprisingly, more keenly focused the attention of regulators and others on the business. This issue contains two articles on the competition law efforts of regulators in Asia and Europe. The article on page 23 examines the EU’s new regulations impacting the shipping industry, and the article on page 20 looks at the effects of the new Competition Act in Singapore on international firms doing business there.

Long the financial capital of Southeast Asia, Singapore has established itself in recent years as the home to many of the world’s top building yards for offshore rigs. Wikborg Rein partner Finn Bjørnstad, who recently returned from three years in our Singapore office, writes with partner Kelly Malone, on page 12 about this firm’s body of experience and expertise with the offshore industry.

Though the economic times may be good, our lawyers are not content to simply accept traditional assumptions about the liability of those whose negligence causes harm to shipowners and their insurers. This issue contains a thought-provoking article about the liability of classification societies on page 9. Long assumed to be effectively beyond the reach of tort and contract liability by many legal observers, our lawyers have been involved in challenging this notion. Negligence by a classification society, or even a government agency, is no longer something that shipowners must necessarily accept without recourse.

As our practice has continued to grow, so too has our staff. In addition to six new associates, Anders W. Færden joined our Oslo office in September as partner. As the article on page 25 explains in more detail, Anders is highly regarded in maritime law circles, admitted to practice before the Norwegian Supreme Court, and a lawyer who genuinely enjoys tackling the most difficult and complex of legal questions. We are extremely pleased with his decision to join our firm.

We hope you enjoy this issue of the Update along with our very best wishes for a happy and successful 2006!

Yours truly,WIKBORG REIN

Trond EilertsenLeader of Wikborg Rein’sShipping and Offshore group

PUBLISHER: Wikborg Rein EDITORIAL STAFF: Gaute Gjelsten, Herman Steen, Stephen N. Lamb DESIGN: Lise Røed PRINT: HBO

WIKBORG REIN JANUARY 2006 3

4 WIKBORG REIN JANUARY 2006

ClosingsSUBJECT

Imagine sitting in the London conference room of one of the world’s largest ship registries. The room is crowded with representatives from the buyer and seller of the vessel that is about to change hands, and the nervous small talk has run out as everyone waits for confirmation that the funds have arrived in the seller’s bank account. The phone rings, but it is not the bank. Instead it’s the buyer’s representatives on board the ves-sel calling to remind the meeting that the vessel is due to be de-livered under a charterparty in less than 30 minutes. No funds – no delivery.

It turns out the bank has the wrong account number on the SWIFT interbank payment message. The correct account number is quickly for-warded to the bank and everyone around the table laughs nervously in relief. Then the registrar enters the room and asks: “Which one of you has the original bill of sale....?” No one answers.

Most such scenarios end happily with a last-minute solution and only a minor delay. But on rare occasions, a once-willing buyer or seller has become decidedly reluctant and practical difficulties with the closing are exploited to cancel the transaction altogether.

Common reasons why closings go wrongWhat is a “closing”?“Closing” is a shorthand term for the completion of a transaction. The term closing can be defined as the conclusion of an object’s sale, whereby: (1) payment is made; (2) any previous mortgages discharged; (3) the title to the asset is transferred; and (4) any new mortgages se-cured.

The listThe below list – although not complete – identifies the most common reasons why closings go wrong:

1 Failure to agree in advance on closing and payment procedures2 Documents not prepared in advance or not present at closing 3 Failure to agree on delivery documents4 Vessel not physically ready 5 Documents lost or delayed6 Documents contain mistakes and / or are not properly notarised or legalised7 Payment is inadequate or delayed8 Registries / banks not open or unwilling to open early or stay late9 Registry does not produce the documents when expected10 Buyer trying to renegotiate at the last minute or new issues arising at closing

How to make sure yours goes rightThe good news is that an overwhelming majority of closings are com-pleted without any major problems. And those problems most com-monly encountered can almost always be avoided through proper preparation and communication. Specifically, this means having deter-mined all of the buyer’s and seller’s main obligations and then nego-tiating and finalizing a tailored memorandum of agreement (“MoA”), closing memo and document checklist.

The importance of being well prepared and how to prepareIn a perfect world, a closing would not take place until all details are thoroughly planned. But in reality, not all closings take place with the luxury of a schedule that allows for such thorough preparation. The usual schedule requires all participants to prioritize by distinguishing those matters of importance that must absolutely be dealt with before the closing and those less important, which can be dealt with later. When a new sale and purchase transaction arises it can be helpful to draw up a chart and check-list showing: (1) buyer’s and seller’s name, corporate status and jurisdiction; (2) vessel name, type, flag state and any encumbrances (to be discharged or registered); (3) any change of flag information; and (4) whether the parties have agreed upon a pay-ment procedure. As the check-list is filled in with information, the next steps are easily put in their proper order for the day of closing (e.g. MoA, mortgage discharge, vessel deletion, vessel registration and mortgage registration).

Tailor the MoA for a smooth closingThe best way to avoid last minute discussions is to ensure that the discussions are closed at an early stage with a tightly worded MoA between the seller and the buyer in which they agree upon all material aspects of the deal.

A large number of sales are based on MoAs on the “Norwegian Sale-form” which in its original form does not include many guidelines as to how the closing should be completed. It merely lists a suggested set of documents to be delivered to the buyer “in exchange for the purchase price” pursuant to clause 8. Failing to discuss or agree on the closing procedure and the documents to be presented may lead to unpleasant surprises later. Consequently; the parties should ideally prepare an addendum to the agreement listing the main documents to be delivered by both parties. Just as important – at least for seller – is to clearly state that the free and clear certificate of ownership and encumbrances will not be presented to buyer until after the purchase price (and payment for bunkers and lubes) are well received in order for the mortgage, if any, to be discharged.

Prepare and finalise a closing memo and a document list The next step after finalising the MoA should be to start drafting a closing memo and a document checklist (if not included in the MoA as

WHy CLOSINGS GO WRONG- AND HOW TO MAKE SURE yOURS GOES RIGHT

5WIKBORG REIN JANUARY 2006

ClosingsSUBJECT

mentioned above). While most closings will involve the buyer also hav-ing to comply with a condition precedent (“CP”) list related to a loan agreement, this article does not deal with that particular aspect. The main purposes of a closing memo is to outline the closing procedure and to complete the list of documents and serves the important pur-pose of identifying any obstacles to the closing procedure as all parties will consider whether they will be able to comply with the obligations listed. A good closing memo will:(i) include names and contact details for everyone involved, including the ship registries. If a time difference is involved then each party’s local time should be specified.

(ii) reflect on an accurate payment and closing procedure. Particular attention should be paid to ensuring agreement on these steps, as they involve the cooperation of players other than the seller and buyer. 90 % of the world’s fleet is mortgaged, and one should bear in mind that in the event of a mortgage registered against the vessel, the mortga-gee will not normally discharge the mortgage until repayment of the loan is made. The wording of the standard clause 8 of the MoA how-ever, states that delivery of the delivery documents shall take place “in exchange for payment”, stating that the payment and delivery ob-ligations should be performed simultaneously. In practice, this is not possible and it is normally assumed as an obligation of both parties to ensure that the risks involved are minimized. One procedure used, which also ensures a high level of simultaneous performance, is to table all delivery documents and for the buyer (through buyer’s bank) to present an unconditional and irrevocable payment letter. Delivering the payment letter to the seller or seller’s bank (mortgagee) will be regarded as equivalent to payment, and the mortgagee will discharge the mortgage without having to wait for the funds to actually arrive at sellers account prior to proceeding with the discharge of mortgage and the release of the other delivery documents. If however a procedure is agreed where the buyers will pay the funds to seller (seller’s banks) account, the mortgagee is often asked to issue an undertaking stat-ing that they will discharge the mortgage upon receipt of the funds at the relevant account, also often accompanied by a statement from the sellers that at the same time the bill of sale will be released and the protocol of delivery and acceptance signed. This procedure ensure that both seller and buyer can feel confident they will receive payment and a free and clear vessel, respectively.

Seller’s obligationsSeller have the most extensive obligations in the closing. In addition to physically preparing the vessel for delivery, all delivery documents including the ones representing title to the vessel must be prepared and brought to closing, as well as making the necessary arrangements with the vessel’s current ship registry. The heading could also have included “seller’s bank or current mortgagee” as the mortgagee and bank are playing important roles in the closing. The main focus of the seller should be the following:

- Prepare the delivery documents pursuant to the MoA and request that the same are pre-cleared by the buyer in advance both as drafts and in completed form.- Make arrangements with the current ship registry and have all docu-ments required for deletion of the vessel pre-cleared. Obtain confirma-

tion from the registry that all is ready for discharge of the existing mortgage and deletion of the vessel (if relevant). If the vessel is bare-boat registered, make sure that deletion is facilitated and documented pursuant to the requirements of the main register as they may refuse the delete otherwise.- Ensure that the current mortgagee has facilitated the mortgage dis-charge and agree on the trigger for the actual discharge. Be prepared that the mortgagee will not normally discharge the mortgage until they have received the funds outstanding under the relevant loan(s). Make sure the buyer understand the same.

Buyer’s obligationsFrom a strict closing perspective, a buyer’s task is normally easy: de-liver a few corporate documents, sign the deposit release, accept the delivery documents and the vessel and pay the purchase price, bunkers and lubes and any extras. Nonetheless, the buyers should ensure the following:

- Prepare the corporate documents in due course, have them pre-ap-proved by the seller, both as drafts and in completed form (notarised and legalised/apostilled). Bring originals as agreed. - Agree on the deposit release letter and make sure to bring a power of attorney (pre-approved) or proof of identity empowering a representa-tive of the buyer to sign the release letter.- Request to pre sight all seller delivery documents if possible in draft and completed form.- Agree on the payment procedure also for the balance and bunkers and lubes. Ensure that the financing bank agrees to the payment proce-dure between the seller and buyer as early as possible. Double check the payment details.

Even if this is a matter for the buyer; the vessel will either be chang-ing ownership within the same registry or change flag. In both cir-cumstances buyer should ensure as early as possible if any of these procedures requires documents from the seller (in addition to the origi-nal/copy of a bill of sale). If so, these documents should be identified and pre-cleared by the registry as early as possible, and if not included in the document checklist, the buyer will have to rely on the seller’s discretion as to whether they will assist.

In the likely event that a new mortgage is being registered against the vessel, this should also be pre-cleared with the registry in advance. When a second mortgage is to be recorded in favour of a mortgagee other than the first priority mortgage, a letter of consent from the first mortgagee must be presented.

Final preparations and on the closing dayIf possible, a final check should be made the day before closing; and if possible a final message should be distributed to all parties confirming relevant details for the closing. All that is left is to ensure that cell phone batteries are charged, original bill of sales are in hand, and of course the correct account number on the SWIFT message.

FOR MORE INFORMATION, CONTACT: Linn Hertwig Eidsheim ([email protected]) or

Bernhard Haukali ([email protected])


PURPOSE, SCOPE AND SAFETy MANAGEMENTTHE NEW NORWEGIAN SHIP SAFETy ACT The existing Norwegian Seaworthiness Act was originally issued in 1903. While it has been amended frequently since that time in an attempt to reflect the enormous technical, environmental, political, national, international and legal changes regarding ship safety it is today considered unsatisfactory in many respects. Consequently, on its 100th anniversary, a committee was appointed to revise the existing Act. The committee submitted its unanimous report on 29 June 2005 (NOU 2005:14) proposing a new Act – the Ship Safety Act. The report was sent out for comments until 21 November 2005. Based on the few objections received during the comment period, it is expected that the proposal will most likely be adopted in its present form. The new Act is expected to enter into force prior to 2007.

Mandate and purposeThe mandate of the committee focused on drafting of a set of rules which would be in line with international and EU regulations regarding vessel safety management. The committee was charged with developing a more uniform regulation and the reduction of the level of details in the existing Act by i.a. delegation to the competent Ministries. As part of this process the committee evaluated modernizing supervision and control, available sanctions against infringements of the rules, and the incorporation of other Norwegian Acts.

The purpose of the new Act is to safeguard life, health, property and the environment by promoting a high level of ship safety, ensuring a safe working environment, preventing pollution from vessels, incorporating requirements and responsibilities for vessel’s safety management system, establishing and developing appropriate supervision and control and arranging for the development of regulations in compliance with international law, in particular IMO (e.g. SOLAS, MARPOL, the ISM and ISPS Code), ILO and EU rules.

Material and geographic scopeThe new Act will apply to Norwegian and foreign vessels, except for non-commercial vessels with an overall length of less than 24 meters. The new Act will apply to Norwegian flagged vessels throughout the world while foreign vessels will only be subject to the new Act while in Norwegian waters . The government may decide whether and to what extent the new Act and regulations laid down pursuant to its provisions shall apply to other units and/or vessels like e.g. offshore drilling units.

“Safety Management” versus “Seaworthiness”Under the existing Act, safety at sea is linked to the concept of “seaworthiness”, which has also been adopted in the Norwegian Maritime Code and the Norwegian Marine Insurance Plan. In the new Act, this concept is phased out and replaced by the new concept of “internal control methodology” which is defined in the new Act as “safety management” (in Norwegian: “sikkerhetsstyring”).

The concept of “safety management” is well known from the ISM Code. The committee states that for those already complying with the ISM Code, the new Act’s strong emphasis on safety management will not necessarily mean any substantial changes. However, it is important to note that unlike the ISM Code, the new Act introduces safety management requirements not only for vessel operations, but also vessel engineering and building.

The new Act prescribes a general duty for the shipowners (in Norwegian: “reder”) to provide for, ensure and develop the establishment of a sufficient safety management system that can be verified and documented in order to survey and control the risk as well as to assure that applicable rules are followed. The master and the crew on board the vessel have certain duties to contribute to the establishment of the vessel’s safety management. The concept of safety management is generally flexible and comprises the vessel, her management and the qualifications of the crew. Whereas the new Act sets out the concept in more general terms, its details will be contained in regulations laid down pursuant to the new Act and shall i.a. take into account the particular need of the shipowners and the activity and business they run.

Ship Safety ActSUBJECT

�WIKBORG REIN JANUARY 2006

Part of the mandate of the committee for the revision of the existing Norwegian Seaworthiness Act was to stipulate the shipowner’s and master’s responsibilities for the vessel’s safety management system. Moreover, the committee had to evaluate a modernization of the scope and extent of the vessel’s safety management control and legal consequences of an infringement of stipulated rules. The existing Act is today seen as too inflexible and ineffective in these respects.

ResponsibilitiesFollowing the grounding and subsequent loss of the high speed passenger catamaran “SLEIPNER” in 1999, it was concluded that the Norwegian Maritime Directorate was not subject to liability under the existing Act. The new Act clarifies that the operation of the vessel does not lie within the responsibilities of the Directorate but is primarily the responsibility of the shipowner and that the latter is liable in case of an infringement of applicable rules. The master is liable in connection with the operation of the vessel, such as navigation and watchkeeping; and the crew may be liable where they have distinct duties.

SupervisionPursuant to the existing Act, vessels of 50 gross ton or more are subject to supervision by the Norwegian Maritime Directorate, which has authorized five classifications societies (GL, DNV, ABS, LR, BV) to carry out parts of the necessary surveys. The committee finds this cooperation fit and suitable and it is therefore maintained in the new Act. Further, the new Act opens for an authorization of approved undertakings and authorities, be they private, foreign (e.g. according to the Paris MOU) or international (such as e.g. the European Maritime Safety Agency (EMSA)).

The committee emphasises that even though the focus on the shipowner’s responsibilities has increased over the years, e.g. as a result of the ISM Code, it has thus far not been sufficient to avoid major discrepancies from applicable rules. Therefore, safety management without supervision is not considered satisfactory, and the new Act is based on a “double-track” system: (1) primary supervision of the safety management system, i.e. primarily an inspection and verification of the shipowner’s written documentation and implementation of necessary measures, along with interviews and evaluations with the shipowner’s management and personnel; and (2) direct control by way of inspection of the vessel. The new Act leaves open the possibility that primary supervision may in the future gradually replace direct control. Even though the latter possibility is in accordance with the purpose of the ISM Code, it is questionable whether it is also in

accordance with the latest EU developments as expressed in the third Maritime Safety Package.

Legal consequencesThe only administrative sanction for infringement provided for in the current Seaworthiness Act (except for infringement of rules on pollution prevention) is detention of the vessel. Detention is only allowed if the vessel is not seaworthy or the certificates are invalid. Less serious infringements of the rules are only subject to criminal liability, if any. The new Act de-emphasizes criminal liability as legal consequences for infringement and instead introduces alternative measures: (1) administrative acts (in Norwegian: “forvaltningstiltak”); and (2) administrative sanctions (in Norwegian: “administrative sanksjoner”). Administrative acts are – in ascending order according to the degree of seriousness – requests to carry out certain measures, fines and withdrawal of statutory certificates. Administrative sanctions are administrative fines that are implemented in case of an infringement of applicable rules. The current possibility for the vessel’s detention has been upheld in the new Act. Administrative acts and sanctions apply to Norwegian and foreign vessels; and foreign vessels may also be denied future access to Norwegian waters.

Since administrative fines may be implemented fast and without the involvement of the prosecuting authorities and courts, they are an immediate reaction to an infringement of the vessel’s safety management. Administrative fines may amount to approximately the same amounts as criminal penalties under the current system. It is therefore the committee’s view that administrative fines may, in particular in relation to foreign vessels, be more efficient than criminal penalties and consequently replace the latter in many cases.

Provisions on criminal liability previously set out in the Norwegian Criminal Act have been incorporated into the new Act, giving statutory basis for penalties and imprisonment of up to six months in case of substantial infringements of certain rules – under aggravating circumstances up to two years. Criminal liability applies to the shipowners personally, the shipowning company, the master and the crew.

Ship Safety ActSUBJECT

RESPONSIBILITIES, SUPERVISION AND LEGAL CONSEQUENCES

FOR MORE INFORMATION, CONTACT: Simone Trondal ([email protected]),Gry Bratvold ([email protected]) orGaute Gjelsten ([email protected])

PHOTO: © Scanpix


SUBJECT

During 2006/2007 the Norwegian Accident Investigation Board will be granted authority to investigate accidents at sea in addition to accidents within the aviation, railway and road sectors.

The new legislation to govern these investigations of accidents at sea has already been passed although they have not yet entered into force. The new rules focuses on the establishment of the course of events in order to promote the safety at sea and the purpose of the investigations carried out shall not be to apportion blame and liability. Included in the new rules are generally duties to inform the proper authorities of any accidents at sea, extensive duties to offer testimony or deliver documents to the Investigation Board combined with restrictions on the Investigation Board not to use such information for unrelated purposes. This article will summarize some of the more important of these new rules.

Duty to notify The new legislation introduces a general duty for “anyone” who witnesses an accident at sea, wreckage or other conditions that gives reason to believe an accident at sea has occurred, to notify the authorities. There rests a heavier burden on the master of ships and ship-owners to fulfil such a duty of notification.

Testimony and other evidenceThe new rules further impose an extensive general duty to offer testimony and share documents with the authorities. “Anyone” has a duty to contribute with all relevant information, “regardless of duties of confidentiality”. A party offering such information is entitled to be represented by an attorney or other representative through the course of the proceedings.

Limited use of testimoniesThe Investigation Board can only use testimonies in order to promote the safety at sea. Testimonies offered can thus not be used as evidence in a possible criminal case against the person offering the testimony. Testimonies can however be used as evidence in criminal cases against other individuals than the one offering the testimony. A testimony given by an officer can therefore not be used in a possible criminal case against that officer, but can be used as evidence in a possible criminal case against the captain.

Confidentiality The Investigation Board has an extensive duty of confidentiality in conducting its business, with some important exceptions. The duty of confidentiality is outweighed by “weighty public interest” or “if necessary to properly explain the cause of the accident”.

New prohibition against removal of wreckage Under the new rules removal of wreckage or other material without the prior consent of the Investigation Board or police authorities is prohibited. The only exception from this prohibition is if the object will be lost unless removed immediately.

About the Investigation Board The Investigation Board is an independent investigation body with the authority to hand over entire or parts of investigations to foreign states authorities, to co-operate with foreign authorities, to allow participation of foreign authorities in investigations and further the Investigation Board can request assistance from local police, courts of justice and other authorities as well as external expertise necessary to carry out an investigation.

Report An investigation shall conclude with a report that outlines the course of events, causal relations, recommendations related to improved safety at sea. A draft report will be prepared and sent for consultation to interested parties before a final report is prepared and published.

NORWEGIAN ACCIDENT INVESTIGATION BOARD TO INVESTIGATE ACCIDENTS AT SEA

Accident investigation

FOR MORE INFORMATION, CONTACT: Siri Birgitte Bang ([email protected]) or

Geir Ove Røberg ([email protected])

PHOTO: © Scanpix


Class societiesSUBJECT

As important as they are at times controversial, classification societies occupy a unique place in the field of maritime law and commerce.

Class enforce statutory requirements on behalf of flag and port states yet the societies are not government agencies themselves. Classification societies have the power to impose sanctions yet they also compete for the business of those who come under their scrutiny. Class make and enforce the rules but also offer consulting services on how best to comply. Classification societies require the shipowners they scrutinise to have systems of accountability, yet the societies themselves remain largely a stranger to the concept of legal liability for their own negligence. Classification societies derive nearly all of their maritime revenue – directly or indirectly – from shipowners yet resist liability when an owner is wronged through class negligence. Increasingly, this mix of roles and attitudes has struck many observers as problematic in the context of the discussion over whether classification societies should be legally liable for their negligence.

The three most frequently heard arguments against liability are that the relatively small size of classification fees cannot justify the potential liability exposure; the shipowner has ultimate responsibility for vessel seaworthiness; and the “special character” of a public service institution should provide relief from legal liability.

In today’s world, class is hardly unique among professionals who charge relatively small amounts for their services, yet still risk a considerable economic liability for losses caused by their negligence. Other professionals customarily minimise the risk through different forms of insurance arrangements and increasingly class has done the same. And with earnings sheets that are more comparable to successful businesses than service institutions, today’s classification societies have a more reasonable ratio of fees to exposure than a whole host of organisations and industries.

While the shipowner always remains responsible for his vessel’s seaworthiness, he or she should be able to rely on the class certificate. But if the classification society is unwilling to accept legal responsibility for its judgments then how much credibility can an owner or insurer be reasonably expected to place in the certificate? In the case of newbuildings, the class representative (customarily paid by the yard) has not just performed one survey but rather been a regular presence on site throughout the vessel’s construction. Under such circumstances, is it appropriate for a new owner to bear the risk for loss caused by the classification society’s negligence if the vessel is designed, built and tested in accordance with the classification society’s own rules, and where this control has led to a classification certificate and delivery of the vessel?

In Norway, the authorities have delegated certain control functions through the Agreement of 1 July 198� with annexes between the Ministry of Trade and Det Norske Veritas (“DNV”). This delegation has lead to some questions regarding the role DNV holds. The tasks DnV performs on behalf of the authorities are considered to be more of a service than business nature. Activities of a service nature have traditionally held a protected position in Norwegian tort law, and there might be reason to ask if this protection has influenced the discussion on classification societies’ liability for those tasks that are not performed on behalf of the authorities.

The claim that classification societies are public spirited service institutions deserving of special treatment with regards to liability dates back many years. Today, it must be examined in light of the fact that hospitals, health professionals, accounting firms, and even government agencies are all now held legally liable for their negligence. While certainly true that classification societies perform important and valuable research on

improving safety at sea, commentators have questioned whether it is still appropriate for that research to be carried out by each society individually. If classification societies are deserving of special treatment with regards to liability because of their public mission, then many believe the public mission would be more efficiently and effectively pursued by combining resources through one set of standards rather than the societies competing amongst themselves.

The long simmering debate over classification society liability was raised a notch in 2003 when the Spanish government sued the classification society responsible for classing the Prestige. And there are no signs of it cooling anytime in the near future. As shipowners are increasingly held accountable by class for their performance and actions they are expecting nothing less than the same of class. On the legal front, the trend in Norway is in favour of increased liability for government bodies dealing with typically “service nature” and class seems unlikely to escape the same fate in the long run.

CLASS SOCIETy LIABILITy

FOR MORE INFORMATION, CONTACT: Gry Bratvold ([email protected]),

Stephen Lamb ([email protected]) orGaute Gjelsten ([email protected])

In today’s world, class is hardly unique among professionals who charge relatively small amounts for their services, yet still risk a considerable economic liability for losses caused by their negligence.

[ ]


The Norwegian Ministry of Commerce recently proposed new legislation concerning the duty of confidentiality (aka “professional secrecy”) for marine insurance companies.

The proposal would provide a limited exemption for insurance com-panies from the current regulation in Norwegian Insurance Com-panies Act section 1-3. Pursuant to the new legislation, marine insurance companies would be allowed to exchange certain information about vessel safety and also to forward such information to the relevant public au-thorities and classification societies without the prior consent of their customer.The purpose of the proposal is to increase the marine insurers’ involvement in the shipping industry’s efforts in limiting so-called sub-standard shipping.

Pursuant to the proposal, the marine insurance com-panies will be entitled to exchange information on vessels and will be obliged to forward certain informa-tion for vessels flying the Norwegian flag to relevant public authorities. The pro-posal defines the relevant information as “information regarding ship safety”, with reference to the proposed new Norwegian Ship Safety Act. The new professional secrecy rules apply both to vessels insured by the insurance company at the relevant time and to vessels previously insured by the insurance company, provided such vessels were insured by the insurance com-pany during the last three years before the information is given.

The proposal will not affect marine insurance companies` possible criminal and/or tort liability by e.g. issuing incorrect information.

The proposal was issued by the Ministry on 1 November 2005 with a comment period closing on 9 December 2005. The new legislation is expected to be implemented into the Norwegian Shipping Act or the new Norwegian Ship Safety Act. It is expected that the propos-al will be adopted by the Norwegian parliament and subsequently come into force during the second half of 2006.

Proposed new legislation:

SAFETy AT SEA AND PROFESSIONAL SECRECy OF MARINE INSURANCE

Marine insuranceSUBJECT

FOR MORE INFORMATION, CONTACT: Birgitte Karlsen ([email protected]) or

Trond Eilertsen ([email protected])

Pursuant to the proposal, the marine insur-ance companies will be entitled to exchange information on vessels. [ ]


Proposed new legislation:

SAFETy AT SEA AND PROFESSIONAL SECRECy OF MARINE INSURANCE

SUBJECT

Under Norwegian law there are four conditions that all must be fulfilled in order for a broker to be entitled to commission:

1 the broker must have been engaged to act as an intermediary, 2 a binding contract must have been concluded between the buyer and the seller,3 the conclusion of the contract must be a result of the broker’s activities, and 4 the contract must be the one, or equivalent to the one, the broker was engaged to negotiate. As under Norwegian law in general, there is no need for the concluded contract to be in writing. The same applies to the contractual relationship between the principal and the broker.

Recently we have seen several cases where parties have concluded binding contracts either with the assistance of other brokers than the broker originally en-gaged, or without bro-kers at all. The broker originally engaged may thus be prevented from fulfilling all conditions for earning commission. Although brokers often hesitate to bite the hand that feeds them, such cases frequently give rise to disputes on whether the original broker is enti-tled to commission.

It is a general principle under Norwe-gian brokerage law that a principal has a duty to see to it that the bro-ker is given the opportunity to earn his commission. This implies that the principal has a duty of loyalty towards the broker that has been engaged and that he normally must continue through this channel. Only in special circumstances will the principal be entitled to change the broker channel without being liable towards the bro-ker originally engaged.

This was discussed in the “Fearncoast” case (ND 19�1 p 233). In his award Sjur Brækhus, as sole arbitrator, held that a principal can stop the negotiations through one established broker chan-nel when he has a substantial and justifiable reason to do so. This would for instance be the situation where it is impossible to continue through this channel. Furthermore he held that change of broker channel could be accepted “… where the possibility to come to a positive result through the existing channel is far worse than the possibilities through other channels.” This test was later also applied by Brækhus in another arbitration, the “Knock Adoon” case (ND 1994 p 202).

The underlying principle that a principal has a clear duty towards the broker first engaged can also be seen in a recent judgment by Borgarting Court of Appeal in March 2005 (LB-2003-1495�) where the court held that the principal in question had no valid reason to change the broker channel.

To summarise, it can be stated that under Norwegian law a principal, whether seller, buyer, owner, charterer or others, can only change the broker channel if he has a substantial and justifiable reason for doing so. Otherwise the original broker may have a claim,

either as a claim for commission or as a claim for damages for breach of contract, and the principal may end up paying double commission. Consequently, parties that have engaged brokers to assist in any deal should think twice before changing the existing broker channel.

FOR MORE INFORMATION, CONTACT: Martin Nes ([email protected]) or

Anders W. Færden ([email protected])

Only in special circumstances will the principal be entitled to change the broker channel with-out being liable towards the bro-ker originally engaged.

Shipbroking

PHOTO: © O.Kobayashi

THE SHIPBROKER’S RIGHT TO COMMISSION - CHANGE OF BROKER CHANNEL

[ ]


Wikborg Rein lawyers participate in a wide range of activities related to the offshore sector, which in-creasingly involves drilling and production projects located in the developing world.

These projects require a special understanding and ability of risk as-sessment, and very often involve operations in a country with an unsta-ble political situation and unclear legal framework. Our lawyers have experience from many such countries not only with respect to offshore projects, but also through our work in the shipping sector generally as well as gas pipelines, hydropower facilities, oil and gas terminals and other infrastructure projects. We have on the map indicated some coun-tries where lawyers from Wikborg Rein have gained experience from international projects over the last few years.

Our offshore lawyers typically get involved in the representation of the owner of a drilling unit, floating production unit (FPSO) or a floating storage unit (FSO) during negotiations of a contract with a petroleum producer. Upon contract finali-zation, the owner then mobilizes the vessel and support operations for relocation to the relevant offshore loca-tion. The producer commonly holds a license to explore for and produce petroleum in an offshore block located in the territorial waters of countries with challenging business environments such as Iran, Indonesia, India, Mexico, Vietnam, Brazil, countries in West Africa, and several former Soviet Union countries. In many cases, the host country strongly depends on revenue from the oil and gas sector for its income.

We have on the basis of our experience developed the checklist of issues below that our clients would typically con-sider before they commit to a project in any such country. Most of these issues also apply in developed countries, but the out-come of the risk assessment may in these countries be more predict-able. Depending on the country in question, the client may also obtain a “Country Risk Assessment” from one of the international consultancy firms focusing more on the non-legal aspects, such as political, corrup-tion, crime and other risks and threats that the project may face.

Host country issues Project structure and the need for operating (in part or in full) through a local entity established in the host country, local partner requirements, local flag requirement and possibility of dual registration etc.; Concessions and licenses needed for operation from central and/or local governments; Import licence for mobilisation and export licence (and other formali-ties and monetary obligations) for demobilisation; Tax issues, including withholding tax and VAT on operation revenue, tax on profit and other local and central taxes and duties, claw back regulations and personal income tax for expats; Limitations on convertibility of local currency and other foreign ex-

change and profit repatriation issues that affect contractor’s ability to take out operating revenue from the host country (to the extent contrac-tor receives payment in local currency, and/or through local banks); Overlapping claim to same territorial waters by neighboring country (e.g. dispute between East Timor and Australia in East Timor Sea); Nationalization programs and their risk of interrupting operations (e.g. Venezuala); Applicable requirements under any unitization treaty or other form of joint development arrangement between host country and other neigh-boring countries (e.g. joint develop-ment of

off-shore blocks in the Gulf of Thailand between Thailand and Malaysia); Limitation on operation in sanction countries imposed by outside jurisdictions (e.g. Norwegian sanction laws related to Burma, US sanc-tion laws related to Iran and other countries applicable to Norwegian corporates that have raised capital or debt financing in the US market); Reputation of local judicial system for enforcing contracts, foreign judgements and international arbitration awards against local parties (applicable when operator contracts through local entity); Local safety, environmental and labour regulations of stricter content than applicable international regulations and those of the flag state of the offshore unit; Local content requirements and actual ability to procure local labour

MANAGING OFFSHORE PROJECT RISK - A CHECKLIST FOR NORWEGIAN DRILLING COMPANIES OPERATING ABROAD

Offshore managementSUBJECT

AntiguaDominican Republic

Brazil

ArgentinaChile

Bolivia

Colombia

Venezuela

Panama

honduras

Mexico

BelizeGuatemala

Costa Rica

Peru

JordanEgypt

Morocco

Turkey

Sierra Leone

Cote d’Ivore Nigeria

Congo-Brazzeville

Benin

Gabon

Equatorial Guinea


and supplies, including related to insurance cover through local insurance companies; Consequence of facilitation payments and other instances of petty cor-ruption (e.g. criminal liability under anti-corruption provisions in the Nor-wegian Penal Code as well as applicable anti-corruption laws in the United States); Contracts with operation support suppliers; Work visas for expats and other immigration issues; Applicability of relevant international treaties; and Availability scope of cover and cost of political risk insurance, or cover of political risks under other insurances.

Operator and contractual issues Identification of contractual counter party (e.g. whether operator

contracts on its own behalf or on

behalf of the

li-cense

group? May the parties in the

license group change during the time of the contract, and thereby change credit risk position of the contractor?); Contractor recourse against multiple operator parties on a several liabil-ity basis in many different jurisdictions; Need for credit enhancement mechanisms (e.g. payment guarantees from banks or parent companies, letters of credit, etc.); Validity of rights under production sharing, licensing or other concession arrangements; Corporate authorizations for execution of contract and related agree-ments, local permits, government approvals, etc.; Area of operation, and risks related to moving the unit between defined areas;

FOR MORE INFORMATION, CONTACT: Finn Bjørnstad ([email protected]) or

Kelly Malone ([email protected])

Offshore managementSUBJECT

Services (scope, duration, option to extend, right to vary), and no obligations of the operator under terms of PSA or a license should be applicable to the contractor by reference to such terms without clear specification in the contract; Unit specification (equipment and personnel, performance stand-ards, certifications, surveys, audit rights and availability); Well-related matters (e.g. operation program, location, completion, drilling records, supply of sub-sea data etc.), and no well or produc-tion related risks to be accepted by contractor; Compensation matters (e.g. operating rate, redrill rate, breakdown rate, standby rate, force majeure rate, waiting on weather rate, mo-bilization, demobilization, accommodation and meals, level of per-sonnel, rate conflicts), as well as applicability and amount of early termination fee; Allowed time for maintenance programs with downtime risk; Materials, supplies and equipment (contractor-furnished and op-erator-furnished); Payment matters (invoice presentation, right to question invoices, audit rights, timing, place, currency, termination payments, set-off rights, liens, etc.); Performance of services (performance standards, prevention of

fires and blowouts, discipline, safety, authorized representa-tives, environment, unsatisfactory performance, operator’s

take-over right, performance bond, etc.); Local content requirements (e.g. employment of local personnel, preference for local suppliers, preference for local subcontractors, cooperation with local companies, accurancy of information); Insurance matters (e.g. policy type, policy scope, in-surance company non-performance, failure to provide, certifications, notice of claims, consequential losses, cognisance, etc.); Liability and indemnity matters, and applicability of

“knock for knock” principle between license group and contractor group, and applicability of mandatory local

laws; Demurrage risks related to off-loading operations;

Responsibility for blowouts, pollution and damage to geologi-cal formations;

Taxes and customs duties (contractor’s scope of coverage, whether operator should take risk for changes/new taxes, indemnity for non-payment, operator’s set-off and withholding rights); Permits, laws and regulations (compliance with applicable laws, evidence of required authorizations, compliance with operator in-structions); Force majeure (e.g. definition scope with understanding of spe-cial country-related risks, consequences of prolonged force majeure, claim procedures, etc.); Termination (events of default, remedies, payment of demobiliza-tion fee, post-termination services, and other country-specific issues such as applicability and understanding of “mandatory termination rights” as in Mexico); and Dispute resolution (international arbitration, jurisdiction of foreign and local courts, possibility of enforcement etc.).

Taiwan

hong Kong

PhilippinesVietnam

East Timor

New Guinea

IndonesiaSingapore

Malaysia

Laos

Thailand Cambodia

China

BangladeshPakistanAfghanistanRussiaUkraine

Turkey

Nigeria

South Africa

Congo

Tanzania

Uganda

India

UAE

Angola

Congo-Brazzeville

Gabon

Equatorial Guinea

Sri Lanka

Madagascar

Mosambique

Australia

New Zealand

South Korea

IMAGE: © gettyimages


Under Chinese law complex questions arise regarding the carrier’s right to lien on the cargo and the enforcement of such lien, often leaving the carrier with a difficult dilemma of whether or not to exercise a lienRight to lienArticle 8� of the People’s Republic of China (“PRC”) Maritime Act provides that: “if the freight, contribution in general average, demurrage to be paid to the carrier and other necessary charges paid by the carrier on behalf of the owner of the goods as well as other charges to be paid to the carrier have not been paid in full, nor has appropriate security been given, the carrier may have a lien, to a reasonable extent, on his goods”.

There is one school of opinion that the right to lien arises from the provision of transportation and therefore the carrier shall have the right to lien regardless of the ownership of the cargo. The 1999 PRC Contract Act adopted this view and stipulated in Article 315 under the chapter of Contract of Carriage that “when the shipper or the receiver fails to pay the freight and other relevant fees, the carrier has the right to lien on the corresponding goods carried, unless the parties agree otherwise.”

However, the prevailing opinion in practice is that a right to lien arises only if the goods is owned by the party liable for the outstanding freight, demurrage, general average contribution or other relevant charges. Scholars and judges holding this opinion argue that the wording “his goods” under Article 8� of the Maritime Act indicates that only goods owned by the debtor may be liened. In case of carriage of goods by sea, the Maritime Act applies in priority to the Contract Act.

In sum, it is widely agreed that whether or not the carrier can exercise a lien on the goods depends on whether or not the owner of the goods in question has the contractual obligation for the outstanding fees.

In the case of a bill of lading issued under a voyage charterparty, therefore, the key to whether or not the carrier may exercise lien lies is whether the bill of lading holder is liable for the outstanding fees. The carrier may exercise lien on the cargo for demurrage occurring at the discharge port. However, exercise of lien on cargo for

outstanding freight or other fees incurred at the loading port is more arguable. According to Article 69 and �8 of the Maritime Act, the consignee or holder of a bill of lading shall not be liable for freight or other fees incurred at the loading port, unless his obligation for payment for such is expressly stipulated in the bill of lading. In the judgment issued by the Shanghai High Court regarding China Limber Huadong v. Milena Ship Management Co. Ltd. and Charter Harvest Shipping Ltd. 199�, upholding the original judgment from Shanghai Maritime Court, the court further clarifies that even when a charterparty which terms are incorporated into a bill of lading makes the consignee or bill of lading holder the liable party for the freight or other fees incurred at the loading port, the consignee or bill of lading holder shall not be bound by such provision unless it is expressly stipulated in the bill of lading.

Exercise and enforcement of lienThe carrier is not required to resort to judicial procedures in order to exercise his right to lien on cargo. However, the carrier is required under the PRC Guarantee Act to give the debtor a period of no less than 2 months (the “Performance Period”) to pay off the debt when he announces the lien.

In order to maintain his right to lien, the carrier shall keep the cargo under his control and has the obligation to take care of the cargo under custody. The right to lien will be lost if the cargo leaves the custody of the carrier. In practice, the carrier can usually exert control over the cargo via the help from its local agent.

RIGHT TO LIEN ON CARGO UNDER CHINESE LAW- BLESSING OR CURSE?

Maritime liensSUBJECT


[ ]

SUBJECTMaritime liens

PHOTO: © O. Kobayashi

WIKBORG REIN JANUARY 2006 15

When the carrier intends to exercise the lien on the cargo for outstanding fees and expenses occurred at the loading, he could actually be facing considerable risk.

The PRC Guarantee Act grants the carrier the right to enforce lien when the debtor fails to pay the outstanding fees by the end of the Performance Period by sale or auction of the cargo or by agreeing with the debtor on the value of the cargo and offset the same with the outstanding claims.

PRC Maritime Act does not clarify the ways to enforce a lien. The

wording of Article 88 of the Act, however, leaves room for some practitioners to argue that the lien on cargo may be enforced only through a forced auction held by a court. There are conflicting opinions in this regard among scholars, practitioners and judges and unfortunately Chinese courts are not bound by previous judgements on same issues. Consequently, this is far from being a settled issue and the safest approach to the enforcement of a lien remains applying to the court for the auction.

Dilemma faced by the carrierAs can be seen from above, when the carrier intends to exercise the lien on the cargo for outstanding fees and expenses occurred at the loading, he could actually be facing considerable risk that the lien will be held illegal by a Chinese court at a later stage. Should the lien be held illegal, the Owners may face claims from the receiver ranging from storage fee, fines from customs office for late clearance, drop in

price, to the court fees of the proceedings. In order to avoid providing the cargo receiver the grounds to claim for a wrongful lien, some Owners might consider choosing to lien the cargo “quietly”, i.e. withholding the cargo without formally announcing the lien. Assuming that the local agent is willing to convey its full cooperation in the custody of the cargo and in the refusal of delivery of cargo to the receivers, the frustrated receiver may still resort to the court for an injunction to enforce delivery. Without announcing the lien in the first place, the Owners will then probably be forced to release the cargo for lack of justifiable reason to withhold the cargo, in addition to facing claims for late delivery.

It could indeed be a tough call for the Owners to decide whether or not to announce the lien on the cargo. Either way, the Owners will face considerable risks. A further question might be: when to officially announce the lien. Various factors should apparently be evaluated before the Owners make a decision, e.g. the pressure that the receiver could exert on the charterer to settle the outstanding fees to exchange for a timely release of the goods, the cost and fees for the storage, and the extent of cooperation the Owners may get from the local agent or port.

Even if the legitimacy of the lien is not an issue, when the receiver is the same as the charterer, the Owners may still face difficult situations, e.g. the storage of the cargo for a period up to two months,

the sale or auction of the cargo. The sale of cargo without the court’s involvement may be held illegal at a later stage, while the auction of the cargo via judicial proceedings may turn out to be both time and cost consuming. In any event, while the right to lien could be an effective way to secure the Owners’ claims, Owners are advised to be cautious when they exercise this right, because of the complexities involved.


FOR MORE INFORMATION, CONTACT: Deborah yu ([email protected]) or

yafeng Sun ([email protected])

INTERNATIONAL CONVENTIONS RATIFIED By CHINA

ConventionsSUBJECT

This firm [Wikborg Rein] has traditionally had a stronghold in the shipping market in Norway according to commentators, and is still considered by many to have the best grip on the Norwe-gian clients. Chambers Global 2004-05


Important shipping related international conventions to which China has acceded:

Contract of carriage • Athens Convention relating to the Carriage of Passengers and their Luggage by Sea, 19�4, as amended by its 19�6 Pro-tocol (but not the 1990 and 2002 Protocols)

Admiralty• International Convention for the Unification of Certain Rules of Law with respect to Collision between Vessels, 1910 (“Col-lision Convention”)• International Convention on Certain Rules Concerning Civil Jurisdiction in Matters of Collision, 1952• International Convention on Salvage, 1989 (“Salvage Con-vention”) (China has made reservations on Article 1 litra a, b and d)• International Convention for the Safety of Life at Sea, 19�4, as amended by its 19�8 and 1988 Protocols (“SOLAS Conven-tion”)• Convention on the International Regulations for Preventing Collisions at Sea, 19�2 (“COLREG”)

Pollution• International Convention for the Prevention of Pollution from Ships, 19�3, as modified by the Protocol of 19�8 (“MARPOL �3/�8”) (China has not acceded Annex IV or VI)• International Convention Relating to Intervention on the High Seas in Cases of Oil Pollution Casualties, 1969, as amended by its 19�3 Protocol• International Convention on Civil Liability for Oil Pollution Damage, 1969, as amended by its 19�6, 1984 and 1992 Pro-tocols (“CLC 92”)

Miscellaneous• International Convention on Maritime Liens and Mortgages, 1993

Important shipping related international conventions to which China has NOT acceded:

Contract of carriage • International Convention for the Unification of Certain Rules of Law relating to Bills of Lading, 1924 (”Hague Rules”)• Protocol of 1968 to amend the International Convention for the Unifi-cation of Certain Rules of Law relating to Bills of Lading, 1924 (“Hague-Visby Rules”)• United Nations Convention on the Carriage of Goods by Sea, 19�8 (“Hamburg Rules”)

Pollution• International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage, 19�1, as amended by the 1992 Protocol (“1992 Fund Convention”)

Limitation of liability• Convention on Limitation of Liability for Maritime Claims, 19�6 (“LLMC”) or the 1996 Protocol

Arrest of vessel• International Convention for the Unification of Certain Rules Relating to the Arrest of Sea-going Ships, 1952 (“Arrest Convention, 1952”)• International Convention on Arrest of Ships, 1999 (“Arrest Conven-tion, 1999”)

Miscellaneous• International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea (“HNS Convention”), 1996

1�WIKBORG REIN JANUARY 2006

Like black boxes carried on aircrafts, voyage data recorders (“VDRs”) enable accident investigators to review procedures and instructions in the mo-ments before an incident and helps to identify the cause of any accident by, inter alia, recording the conversations on the vessel’s bridge. The SOLAS convention chapter V regulation 20 requires that certain vessels on international voyages must be fitted with VDRs. Voice recordings conducted with VDRs fall within the scope of Norwegian legisla-tion protecting the processing of personal data. Shipowners must therefore notify the Data In-spectorate (in Norwegian: “Datatilsynet”) of such systems and comply with other procedures as de-scribed in this article, to avoid fining.

Voice recording performed with electronic equipment fall within the scope of the Norwegian Act of 14 April 2000 no. 31 relating to the Processing of Personal Data (“Personal Data Act”), as such informa-tion may be linked to a physical person.

Consequently, recordings through VDRs can only take place if the shipowner (or appointed manager) comply with conditions set out in the Personal Data Act. Shipowners must therefore notify the Data Inspectorate of the use of VDRs. The notification is due 30 days be-fore any instalment and/or commencement of use of the VDR. Upon receipt of such notification the Data Inspectorate will give the con-troller a receipt of notification.

The provisions in the Personal Data Act applies to shipowners es-tablished in Norway, and to all shipowners established outside the European Economic Area who make use of equipment in Norway for the purpose of processing personal data. Shipowners based else-where in the European Economic Area will normally be subject to the data protection laws of the European Economic Area country in which they are based.

Anyone who wilfully or grossly negligently omits to send notification to the Data Inspectorate is liable to fines or/and imprisonment. The Data Inspectorate has not yet issued any fines for infringement of the notification provisions in the Personal Data Act.

The relevant vessels subject to the duty of notification are vessels under regulation 20 of the revised SOLAS chapter V; ships engaged

on international voyages. The following vessels shall, according to the SOLAS regulation, be fitted with VDRs:

- New passenger ships before they are put into service- Existing ro-ro passenger ships not later than the first survey for safety equipment on or after 1 July 2002- Existing passenger ships other than ro-ro passenger ships not later than 1 January 2004- Cargo ships of 3,000 gross tonnage and upwards construed on or after 1 July 2002, before they are put into service

Norwegian legislation has a broader scope requiring several other vessels to be fitted with a VDR under sections 19 A to 19 C in a regulation issued by the Norwegian Ministry of Trade and Industry of 15 September 1992 no. �01, as amended (“Forskrift om navigas-jonshjelpemidler m.m.”).

In addition to the duty to notify the proper authorities of the use of VDRs, shipowners must comply with the following procedures under the Data Protection Act:

Shipowners must inform the crew about the data collection, cf. section 19. Shipowners must not store personal data longer than necessary to carry out the purpose of the processing, cf. section 28. Recordings by VDR equipment will normally be erased continu-ously. Recordings are generally, while not yet erased, subject to satisfactory data security since access requires special technical knowledge.

Furthermore, shipowners must ensure that voice recordings are used exclusively for stated purposes, such purposes being objec-tively justified by the activities of the shipowner. As an example, re-cordings cannot be used in a labour dispute with a current or former employee. The recordings must further be adequate, relevant and not excessive in relation to the understanding of accident causes.

The Data Protection Act does not limit the Marine Authorities’ ac-cess to recorded material in the course of an investigation. Other third party access must be evaluated on a case by case basis. Ac-cess to recordings should always be subject to reasonable controls, which might include passwords, compartmentalised access and ac-cess logs. Reasonable steps should be taken to detect and prevent unauthorised access. The relevant considerations are throughout any process confidentiality, integrity and accessibility.

VOICE RECORDING USING VOyAGE DATA RECORDERS- REQUIRES NOTICE TO THE DATA INSPECTORATE

FOR MORE INFORMATION, CONTACT: Lars Tormodsgard ([email protected]) or

Lars Inge Ørstavik ([email protected])

SUBJECTVoyage data recorders


In order to minimise the risk of waiting costs at busy ports, many owners add one or more of the four ‘W’s to a standard form charterparty so that notice of readiness (“NOR”), may be tendered (1) whether in port or not; (2) whether in berth or not; (3) whether customs has been cleared or not, and; (4) whether free pratique has been obtained or not. Normally used under charterparties governed by English law, uncertainty may arise when the clauses are inserted into contracts governed by different national law. This article examines the impact of the clause when used in charterparties, such as the Hydro Voyage Charter (“Hydrocharter”), which are governed by Norwegian law.

“Whether in berth or not”Normally, the Hydrocharter is considered a port charter since NOR may be given when the vessel has arrived at the loading and/or discharging port(s). Invoking a clause saying that NOR may be tendered “whether in berth or not”, is thus of less value to the owner under the Hydrocharter. Without such a clause, the owner may also be entitled to tender a NOR before approaching nominated berth.

However, when the nominated place is undoubtedly a berth or terminal, uncertainty may arise as to whether the owner has also agreed that an effective NOR may not be tendered until the vessel actually has arrived at this berth or terminal. In this event, a clause stating “whether in berth or not” would be to owner’s advantage and clarify that the charter should still be considered a port charter.

A “whether in berth or not” clause is quite commonly used in order to make what otherwise would be a berth charter into a port charter.

“Whether in port or not”It is more uncommon to add a “whether in port or not” clause, and when done the effects are less certain. As the question of what constitutes arrival at port may not always be easily determined, the introduction of a “whether in port or not” clause can clarify the issue and hopefully avoid unnecessary discussion regarding the issues of arrival at port, tendering of valid NOR and commencement of laytime.

Under a port charter, the owner may normally tender an effective NOR when the vessel arrive at a safe place within the jurisdiction of the port and/or when the vessel is anchored at the customary

place for vessels to wait for a berth. Still, many different factors may have to be considered in order to decide whether the vessel may be considered as arrived in port. Statutory, fiscal and geographical limits may be good starting points, but other factors may also be relevant. Moreover, the limits and boundaries for a customary waiting place may also be a source for doubts and discussions. By introducing a “whether in port or not” clause owner will be given some leeway

in this respect and consequently rest easier that his NOR has been tendered effectively.

Still, the question of when an effective NOR may be tendered cannot be up to the sole and full discretion of the owner. Even with a “whether in port or not” clause, the vessel should still be somewhere

NOTICE OF READINESS UNDER VOyAGE CHARTERS - The four “Ws” under Norwegian law

Voyage charteringSUBJECT

PHOTO: © Tomas Pinås, shipspotting.com

Wikborg Rein remains (…) in the premier division of shipping law firms, and with offices in Oslo, Shang-hai, London, Singapore and Kobe, has a truly global dimension to its shipping practice. Legal 500 2005


in the close proximity of the port in order for owner to tender a NOR. Otherwise the whole purpose of tendering NOR would be thwarted. The interpretation will probably be quite similar to the “at or off port” clause that is e.g. found in the Intertankvoy form. Typically, if there is congestion at the relevant port and also at customary waiting berth, owner may still anchor outside of the port and tender an effective NOR. However, also without a “whether in port or not”

clause the charterer under the Hydrocharter would likely bear the risk for congestion at the nominated port and owner would be able to tender an effective NOR when the vessel is anchored as near to the port as she may safely get, cf. clause A and the Norwegian Maritime Code (“NMC”) section 333, first paragraph. Accordingly, the effects of adding this clause should not be over-emphasised.

A “whether in berth or not” clause is quite commonly used in order to turn what otherwise would be a berth charter into a port charter.

“Whether customs cleared or not” – “Whether obtained free pratique or not”Whilst “whether in berth or not” and “whether in port or not” concerns more the geographical readiness to load, the issues of “customs cleared” and “free pratique” are of relevance when deciding whether the vessel may in fact commence cargo operations.

Problems in obtaining custom clearance or free pratique are normally due to reasons on the owner’s side, i.e. vessel, and the normal regulation under voyage charters is thus that such risk is allocated to the owner. Accordingly, NOR may not be tendered if the vessel is not customs cleared or has not obtained free pratique and, if NOR already has been tendered, any time lost therefrom shall not count as laytime or time on demurrage. However, should problems in obtaining custom clearance be due to issues relating to cargo, stevedores or other circumstances on the part of the charterer, an effective NOR may usually be tendered by the owner even though such hindrances exist. This allocation of risk is also the likely result under the Hydrocharter when using the NMC as background law, cf. section 332 (“ready to receive cargo”) and section 333 (“hindrance on the part of the voyage carrier”).

Consequently, by introducing a “whether customs cleared or not” clause and/or “whether obtained free pratique or not” clause risks which usually rest on the owner are shifted over to the charterer, enabling the owner to tender a NOR regardless of which hindrances to cargo operations that exists. Especially for the issue of custom clearance, such a clause might be of significant importance for the risk allocation under a voyage charter.

ConclusionAdding one or more of the four “Ws” will generally shift more risk from owner to charterer concerning the tendering of an effective NOR.

The clauses “whether in berth or not” or “whether in port or not” will normally not be of significant importance for the allocation of risk between the charterer and the owner, since similar results would also follow from the NMC and/or standard forms as the Hydrocharter. However, introducing the clauses “whether customs cleared or not” and “whether obtained free pratique or not” will shift significant risk to the charterer under a charter on the Hydrocharter form with Norwegian background law. Accordingly, greater caution should thus be exercised by charterers.

]Voyage chartering

SUBJECT

FOR MORE INFORMATION, CONTACT: Eirik Thomassen ([email protected]) or

Trond Eilertsen ([email protected])

[


THE IMPACT OF THE NEW COMPETITION ACT IN SINGAPORE ON THE SHIPPING INDUSTRyOn 4 November 2004, the Singapore Parliament heralded the dawn of a new era in competition regulation in Singapore by passing the Competition Act 2004 (the “Act”). The Act has come into force in phases, with the key substantive provisions coming into force on 1 January 2006. Provisions relating to mergers and acquisitions will not come into force at least until 1 January 2007.

The Act introduces substantive provisions to regulate how businesses will have to deal with each other in a competitive manner. Additionally, the Act establishes a new regulatory structure, comprising the Competition Commission of Singapore (“CCS”) and the Competition Appeals Board.

The Act prohibits anti-competitive activities that unduly prevent, restrict or distort competition, abuses of dominance by a dominant undertaking, and anti-competitive mergers. These prohibitions are found in Part III of the Act, and specifically in:

- Section 34, which prohibits anti-competitive agreements, decisions and concerted practices- Section 4�, which prohibits the abuse of a dominant position- Section 54, which prohibits anti-competitive mergers

The Act may apply even if the offending agreement (section 34) has been entered into outside Singapore or if a party to that agreement is outside Singapore; or if the undertaking abusing a dominant position (section 4�) is outside Singapore; or if the offending merger (section 54) has taken place outside Singapore or if a party to that merger is outside Singapore, provided always that the activity has the effect on the relevant market in Singapore required to make such activity prohibited.

To provide guidance on how these essential provisions are to be interpreted, the CCS has been empowered under the provisions of the Act to issue guidelines. To date, three sets of finalized guidelines have been issued, and at least seven more will be issued within the next few weeks.

Anti-competitive agreementsThe Guidelines clarify that anti-competitive agreements which have as their object or effect the appreciable prevention, restriction or distortion of competition within Singapore are prohibited. The CCS takes the view that agreements will not usually have an appreciable adverse effect on competition in some instances. This includes agreements where the aggregate market share of the parties does not exceed 20% (if the parties are competitors and agreements where the market share of each of the parties does not exceed 25% (if the parties are non-competitors), and where the agreement is between small and medium sized enterprises i.e. businesses with a fixed asset investment which does not exceed S$15m (manufacturing) or with an employment size of not more than 200 workers (services).

However, notwithstanding the above, certain “hardcore” agreements will always be deemed to have an appreciable adverse effect on competition. These are agreements that directly or indirectly fix prices, bid-rigging (collusive tendering), market sharing and limiting or controlling production or investment.

The provisions of any agreement or any decision that violate this section will be rendered void to the extent of the violation.

Abuse of dominant market positionThe Guidelines stipulate that conduct that constitutes an abuse of a dominant position in a market includes conduct that protects, enhances or perpetuates the dominant position of an undertaking in ways unrelated to competitive merit. An example is limiting production, markets or technical development to the prejudice of consumers. This also applies to undertakings in a dominant position outside Singapore, and which abuse that dominant position in a market in Singapore.

Merger controlGuidelines on merger control have not been published. However, the section prohibits mergers that have resulted, or may be expected to result, in a substantial lessening of competition within any market in Singapore for goods or services.

Market DefinitionThe Guidelines on the definition of “market” provide that “the relevant market is in practice no more than an appropriate frame of reference for competition analysis … in practice, defining a market requires an assessment of the various types of evidence and the exercise of judgment.”

The approach is broadly in line with that taken by the EU Commission who have defined “relevant product market” and “relevant geographic market” as follows:

“A relevant product market comprises all those products and/or services which are regarded as interchangeable or substitutable by the consumer, by reason of the products’ characteristics, their prices and their intended use.”

“The relevant geographic market comprises the area in which the undertakings concerned are involved in the supply and demand of products or services, in which the conditions of competition are sufficiently homogeneous and which can be distinguished from neighbouring areas because the conditions of competition are appreciably different in those areas.”

The definition of markets is important as it sets the parameters within which the anti-competitive activity or an abuse of dominance is determined.

Competition lawSUBJECT


Consequences of infringing the ActIf the CCS determines that there is an infringement and that it was committed intentionally or negligently, it may impose a financial penalty on the business. Any financial penalty will not exceed 10% of the turnover of the business in Singapore for each year of the infringement up to a maximum of 3 years. Prohibited provisions of agreements are void and will not be enforceable in Singapore. Infringements may also lead to private action by affected parties.

CCS’s investigative powersThe Act gives the CCS strong investigative powers, including the right to issue a written notice requiring any person to produce a specific document or information and the right to enter business premises for taking copies of documents and requesting explanations. Failure to cooperate with the CCS may be a criminal offence.

Leniency programmeThe CCS has published draft guidelines for the lenient treatment of undertakings volunteering information on cartel activities. This leniency programme is broadly in line with that implemented by the EU Commission. A point to note is that the first undertaking to alert the CCS about a cartel like situation can be given a 100% immunity from liability.

Impact on the Shipping industryThe imminent enforcement of the Act in its present form has raised the concerns of the shipping industry. This is because the Act seems to be incompatible with the way international shipping business is conducted today with pools, conferences, consortia and ship-sharing arrangements, to name some of the common practices among shipowners.

A number of interested parties have made submissions to the CCS with a view to obtaining a block exemption of such shipping agreements. The Minister has the power to make a block exemption order and the criteria for block exemptions are set out in section 41 of the Act. Such an exemption will only be applicable where the shipping undertaking is not dominant. To be exempted, the category of agreements in question must contribute to improving production or distribution; or promoting technical or economic progress. At the same time, such agreements must not impose on the undertakings concerned restrictions which are not indispensable to the attainment of those objectives; or afford the

undertakings concerned the possibility of eliminating competition in respect of a substantial part of the goods or services in question.

Two notable parties to have made such submissions are the Singapore Shipping Association and the International Chamber of Shipping.

The arguments for and against restrictions on shipping agreements are not new and the CCS will certainly be looking at the experience of other jurisdictions for guidance. At present it is not clear whether or to what extent shipping agreements will be exempted from the general prohibition on anti-competitive agreements. We believe the CCS will be reluctant to enact a stricter competition regime in Singapore than what is applied in the EU. The EU Commission is currently considering removing the block exemption for liner shipping conferences and the procedural exception of the cabotage and tramp vessel services (Regulation 4056/86) and it claims to have broad support for these moves. If these changes are effected, there will be little left of the EU exemptions for shipping agreements and Singapore is likely to follow

the EU’s lead.

Conclusion and adviceThe Act is being enforced in stages to allow the CCS and businesses time to prepare for the new law. On 1 January 2005, the sections on the CCS were brought into force. On 1 September 2005, the sections on appeals were brought into force. The government has issued a schedule for the enforcement of the remaining provisions. On 1 January 2006, the sections on anti-competitive agreements and abuse of dominant market position, among others, will

come into force. The sections on merger control, among others, will come into force at least 12 months later.

For businesses concerned about the new law, the CCS has this encouragement:

“We recognize that businesses should not face undue regulation, which would add to business costs and reduce Singapore’s international competitiveness. The CCS will therefore, instead of attempting to catch all forms of competitive activity, focus principally on activities or conduct that have an appreciable adverse effect on competition.”

The Act seems to be incompatible with the way international shipping business is conducted today with pools, conferences, consortia and ship-sharing arrangements, to name some of the common practices among shipowners.[ ]

Wikborg Rein in cooperation with Rajah & TannFOR MORE INFORMATION, CONTACT:

Erlend W. Holstrøm ([email protected]) orStephen W. Fordham ([email protected])

SUBJECTCompetition law

PHOTO: © O. Kobayashi


Wikborg ReinSUBJECT

WIKBORG REIN’S SHIPPING COMPETITION LAW TEAMUnderstanding the shipping industry and the relevant mar-kets is crucial in arguing competition law issues and our dedicated Shipping Competition Team is specialized in this legal framework’s application to the shipping industry. Over the years we have provided assistance to Norwegian Ship-ping Companies in a wide array of matters.

We have been and are currently assisting our clients in investi-gations carried out by Competition Authorities in Norway, the EC Commission and the US Department of Justice. We have also repre-sented our clients in a variety of other jurisdictions (e.g. several EU countries, Canada, Australia, New Zealand, Singapore, Brazil and South Korea). We cooperate closely with a network of specialized competition law attorneys in all these jurisdictions.

Our team has already conducted through reviews of various pooling arrangements in light of the expected inclusion of tramp shipping under EC jurisdiction, (ref. article p. 23 of this Update). The combina-tion of our team’s legal expertise and industry experience ensures that our clients receive the best possible legal assistance.

Our assistance includes:- General advise on Competition Law for shipowners, brokers, maritime and marine insurers as well as shipping banks- Review of pooling arrangements, joint ventures and other forms of co-operation with actual or potential competitors- Tailor made Competition Compliance Manuals for clients, including lectures for key personnel highlighting “red flag situations” - Dawn Raid Manuals for clients that prepares them for possible inspection from Competition Authorities - Assistance in connection with Dawn Raids and during continued investigation by Competition Authorities- Application for amnesty or leniency to Competition Authorities- Advise in connection with mergers and acquisitions including merger notification to the relevant Competition Authorities, as well as pro-active advise on agreements and corporate structures.

Under the direction of Øystein Meland (pictured), partner in Wikborg Rein, the Shipping Competition Team presently consist of Senior Associate Siri Birgitte Bang and associate Lars Tormodsgard in the Bergen office and Senior Associate Aksel J. Hageler and associate Mats E. Sæther in the Oslo office. Our lawyers have broad study and work experience in competition law and the shipping industry together with extensive experience in dealing with various Compe-tition Authorities. We have further integrated economic expertise in our Shipping Competition Team with Lars Tormodsgard holding a bachelor in business administration from the Norwegian School of Economics and Business Administration (NHH) in addition to his law degree from the University of Bergen.

FOR MORE INFORMATION, CONTACT: Øystein Meland ([email protected]) or

Siri Birgitte Bang ([email protected])Wikborg Rein is one of the few Norwegian firms with a serious international presence. Leading in the fields of maritime and shipping (…), Wikborg Rein is an im-posing presence in the market. PLC Which Lawyer? yearbook 2005



The European Commission has proposed to repeal the block exemption of liner conferences from the EC Treaty competition rules’ ban on restrictive practices (Article 81). The proposal will now be forwarded to the EU’s Council of Ministers for adoption by qualified majority and to the European Parliament for consultation. After its adaptation the Commission will publish guidelines on the application of the competition rules to the sector. The Commissions proposal also covers tramp and cabotage services and guidelines issued would also cover the application of EU competition rules to such services.

This proposal follows a publication of a study undertaken by outside consultants on the potential impact of the signalled repeal of the Block Exemption Regulation for liner shipping conferences. The recently published study has found that the signalled repeal is likely to lead to a decline in transport prices and will have either no impact or a positive impact on the competitiveness of European liner shipping firms.

The study was commissioned to analyse the potential impact of repealing the Block Exemption Regulation for liner shipping conferences (Council Regulation 4056/86) and is a result of the combined work of Global Insight, an international consultancy with significant experience in liner shipping, the Berlin University of Technology and the Institute of Shipping Economics and Logistics in Bremen.

The main findings on the potential impact on the repeal of the Block Exemption of the study are as follows;

- transport prices for liner shipping services will decline- service reliability on deep sea and short sea trades is expected to improve- service quality will either be unaffected or will improve - there is either a positive impact or no impact on the competitiveness of EU liner shipping firms and- small liner shipping carriers will not experience particular problems- no negative impact or even positive impact on EU ports, employment, trade and/or developing countries.

The report did not accept suggestions by the European Liner Affairs Association (ELAA), representing more than �0% of the global liner shipping industry, to replace the current Block Exemption with an information exchange system. The report found such system

would constitute an “invitation to collude” between liner shipping carriers to the detriment of transport users and final consumers.

Supported by the study the Commission has now proposed to repeal the exemption for liner shipping conferences and further to bring tramp and cabotage services under Council Regulation 1/2003, the common competition implementing rules. This will impose a heavy compliance burden on the shipping industry under EU competition laws.

Since companies active in this sector of the economy may have very little, if any, experience of the enforcement of competition law, they may face difficulties in determining whether their operations are compatible with EC competition law. Consequently, the Commission has in a press release of 14 December 2005 signalled its intention to issue guidelines for the industry towards the end of 200� to smooth the transition to a more competitive environment. Such guidelines would also cover the application for EU competition rules to tramp services. As an interim step, the Commission intends to publish an issues paper on liner shipping in September 2006.

The repeal of exemption and the bringing of tramp and cabotage services under EU competition rules will mean that a large number of the commercial arrangements that currently exist between competitor ship owners/operators will have to be rethought and then restructured and/or abandoned to ensure compliance.

The report is published in its entirety on: http://europa.eu.int/comm/competition/antitrust/others/maritime/shipping_report_26102005.pdf

The press release can be read in its entirety on: http://europa.eu.int/rapid/pressReleasesAction.do?reference=IP/05/1586&format=HTML&aged=0&language=EN&guiLanguage=en

SUBJECT

FOR MORE INFORMATION, CONTACT: Siri Birgitte Bang ([email protected]) or

Øystein Meland ([email protected])

EU COMMISSION MOVING FORWARD ON THE REPEAL OF EXEMPTION FOR THE SHIPPING INDUSTRy

Competition law


Maritime Trainee ProgrammeSUBJECT

FOR MORE INFORMATION, CONTACT: Ingrid Lind Groh ([email protected]),

Haakon Stang Lund ([email protected]) orGaute Gjelsten ([email protected])

THE MARITIME TRAINEE PROGRAMME- AN INNOVATION TO PROMOTE THE NORWEGIAN MARITIME CLUSTERIn August 2005 the Norwegian maritime industry, with the Nor-wegian Shipowner’s Association at the helm, launched a two-year maritime trainee programme. The programme involves 21 compa-

nies including ship owners, ship yards, maritime equipment manufacturers, oil rig companies, a classification society, banks, ship brokers – and one law firm: Wikborg Rein. The programme seeks to provide each trainee with a thorough un-derstanding of the maritime industry and thus make them capable of mastering numerous functions within the maritime industry. Wikborg Rein’s associate Ingrid Lind Groh is one of 25 trainees attend-ing the programme. As the only lawyer

among engineers and economists she is entering into a new area of practice, and she describes her learning outcome as exceptional: “For a lawyer working within the maritime field, it is particularly important to understand the practical and technical aspects of the business. This programme provides me with new and important knowledge, and gives me a broad understanding of the distinctive characteristics of the maritime industry in Norway and internation-ally.”

During the two-year period, the trainees will have 6 academic gatherings. These courses will mainly focus on three types of know-how: Maritime knowledge, business comprehension and management expertise.

At present Ms. Lind Groh has attended two gatherings. The first gathering focused upon the maritime cluster, freight markets, mar-ket analysis, shipbroking and chartering, the history of Norwegian shipping, classification and certification. The trainees also spend three days manning three racing sail boats. “During these three days at sea we learned new things about both ourselves and the other trainees. It was a real challenge as almost half of the group was completely inexperienced sailors, and the weather took a turn for the worse as soon as we left the port of Hankø, heading for Denmark”, she says.

“At the second gathering”, Ms. Lind Groh continues, “we looked deeper into the Norwegian maritime cluster – in particular the oil and gas cluster as this gathering took place in Ålesund – and its peculiarities, strengths and weaknesses. We also focused on tech-

nical aspects of the ship industry; ships, equipment, new building and ship design, and visited Aker Yard to see the whole process in practice.”

The next gathering will take place in Singapore, and in August 2006 all the trainees will work 4 months in another trainee com-pany. During the spring 200� the trainees will spend 4-6 months abroad in order to gain international experience. Ms. Lind Groh will be assigned to one of Wikborg Rein’s four offices abroad.

“I have two extremely instructive and challenging years ahead of me”, Ms. Lind Groh says, “especially as I at the same time will take part in the busy daily work at Wikborg Rein’s Shipping Offshore department in Oslo. I feel privileged to be given this possibility, and look forward to absorb all this new knowledge and use it in practice in my work as a lawyer.”

COMPANIES INVOLVED IN THE MARITIME TRAINEE PROGRAMME:

Aker yards ASAAwilco ASDet Norske Veritas DnB Nor ASAEidesvik ASFarstad Shipping ASAFred. Olsen Energy ASAGrieg Billabong ASKnutsen OAS Shipping ASKongsberg Maritime ASLeif Höegh & Co ASNordeaOdfjell Drilling ASR. S. Platou Shipbrokers ASSmedvig ASAStolt Offshore ASTeekay Norway ASTschudi Shipping Company ASUnitor ASAWikborg Rein Wilh. Wilhelmsen ASA



Wikborg Rein

SUBJECTSUBJECT

New Shipping Offshore partner at Wikborg Rein’s Oslo officeWishing to specialise more in the fields of shipping and offshore, Anders W. Færden entered the partnership of Wikborg Rein in September 2005. Coming from the well-known law firm Vogt & Wiig, he has extensive experience and expertise to draw upon when as-sisting clients in Wikborg Rein. His main areas of practice are matters relating to insurance law, maritime law, contract law and litigation. Mr. Færden was admitted to the Su-preme Court in 2000.

Personnel news in the Shipping Offshore Group [from June 2005 to January 2006]

This firm [Wikborg Rein] has traditionally had a stronghold in the shipping market in Norway ac-cording to commentators, and is still considered by many to have the best grip on the Norwegian clients. Chambers Global 2004-05

Anders W. Færden, previously partner in the law firm Vogt & Wiig, has been appointed partner in Wikborg Rein and has joined the firm’s Shipping Offshore Group in Oslo. Finn Bjørnstad has, after two and a half years as resident partner at the firm’s Sin-gapore office, rejoined the Oslo office. Erlend W. Holstrøm, the former resident partner at the Shanghai office, has joined the Singapore office as Bjørnstad’s successor. Birgitte Karlsen has left the Oslo office to reinforce the Singapore office. Lars Berge Andersen has been been appointed chief representative at the Shanghai office. After serving three years at the firm’s office in Kobe, Japan, Henrik Hagberg has returned to the Oslo office. Oddbjørn Slinning has succeeded him at the Kobe office. Af-ter two years at the London office, Linn Eidsheim has rejoined the Bergen office and been promoted to senior associate. Gøran Lunde Aarvik has left the Bergen office and replaced Eidsheim

in London. Alexander Owesen and Linda Rudolfsen Mykle-bust have been promoted to senior associates at the Oslo and Bergen offices, respectively. Louis Skyner, previously a mem-ber of the firm’s Energy Natural Resources Group, has joined the Shipping Offshore Group in Oslo. Ola Berg Lande has left the Oslo office and joined the London office. Anders Monrad has left Wikborg Rein and accepted partnership in another lawfirm. Hågen Hansen, previously associate in the law firm Simonsen Føyen, has joined the Bergen office. Ena Barder has completed her Master studies at King’s College London, and has joined the Oslo office. Ingrid Lind Groh has completed her stay as a re-search assistant at the Scandinavian Institute of Maritime Law, and has joined the Oslo office as a part of the Maritime Trainee Programme under the auspices of the Norwegian Shipowner’s Association.

RATINGSEvery year the international legal market is being evaluated in numerous guides, which publish their rankings broadly. Law firms in most countries worldwide are evaluated, and the guides have proved to be helpful tools when in need of legal assistance abroad.

The methods and thoroughness of the guides vary, and so does the validity of the rankings. Most guides base their rankings on input from clients and the law firms themselves. The well reputed guides reach their conclu-sions through thorough interviews, and their researchers are constantly up to date on the developments in their specific legal area.

The rankings are divided in certain categories which vary from guide to guide. Whilst PLC’s Which Lawyer? works with 15 categories, the European Legal 500 has 13 and Chambers Global only six. All of these three guides are highly regarded, and their rankings are often published in international media.

Throughout this Update you will find quotes from these three guides, giving their evalua-tion of Wikborg Rein’s expertise on shipping law. Within the shipping segment, WR is the highest ranked Norwegian law firm.


WIKBORG REIN'S ShIPPING OFFShORE GROUP IN BERGEN

Wikborg ReinSUBJECT

Øystein Meland is co-leader of the firm’s Shipping Offshore Group with extensive experience in handling shipping matters for Norwegian and foreign

clients. The last three years he has also been extensively involved in competition law aspects of maritime transportation. He is the manager of Bergen Shipowners Association, member of BIMCO’s Documentary Committee and the Legal Committee of the Norwegian Shipowners Association. Meland negotiated the new standard Norwegian shipbuilding contract on behalf of the Norwegian Shipowners Association and will in 2006 publish a commentary to said contract. Meland is admitted to the Norwegian Supreme Court.

Jon Heimset has extensive experience from matters related to the offshore industry, maritime law and marine insurance. He advises Norwegian and

foreign shipping companies, rig owners, suppliers, insurance companies, P&I clubs, shipyards, brokers and corresponding law firms. He is co-author of “Handbook on Loss of Hire Insurance” (together with Haakon Stang Lund and Trond Eilertsen) written at the request of the Norwegian Hull Club.

Geir Ove Røberg has international experience from Wikborg Rein’s London and Kobe offices. For several years he has assisted international,

Nordic and Norwegian shipowners as well as banks with transactions within financing, sale and purchase of entities and assets. He has been leading several international contractual negotiations and has assisted in large projects related to ship financing.

Terje Fiskerstrand mainly works with issues relating to maritime law and tax law. He is also experienced in casualty work and assists P&I clubs, hull underwriters

and owners on these matters. Fiskerstrand has been stationed at Wikborg Rein’s London office.

Lars Inge Ørstavik is experienced within the fields of maritime law and construction law and advises ship owners, yards and underwriters. He is also

experienced in casualty work and assists P&I clubs, hull underwriters and owners on these matters.

Siri Birgitte Bang specialises in intellectual property and competition law, particularly within the maritime sector. She has a Master‘s degree from Santa Clara University

and has also passed the California Bar and is authorised as a lawyer in California, USA.

Øyvind Axe’s main areas of practice are issues relating to maritime law and real estate law. He has studied at Bond University, Australia.

Christian James-Olsen mainly works with offshore related cases, and has experience with advising and negotiating within the oil and gas

industry. He has studied at Bond University, Australia.

Kristoffer Larsen Rognvik is a member of the Shipping Offshore Group. His working areas are contract law and marine insurance law. He has also participated

in several international transactions and financing projects.

PARTNERS SENIOR ASSOCIATES ASSOCIATES

For further details, see www.wr.no

Christian Friis has been a partner with Wikborg Rein since 1990, and is a member of the firm’s Banking and Finance Group. He specializes in

ship financing, and he is mainly assisting foreign and Norwegian shipping banks. Chr. Friis has experience as an inhouse lawyer with Bergen Bank (now known as DnB NOR Bank ASA), and from Watson, Farley & Williams, London.

Lars Tormodsgard specialises on issues relating to the ship-ping and offshore industry. In addition to his law degree from

the University in Bergen he has a bach-elor in business administration from the Norwegian School of Economics and Business Administration (NHH).

Linn Hertwig Eidsheim has international experience from Wikborg Rein’s London office and has studied inter-national law with Hamline Law School in Minnesota,

USA. Eidsheim’s main areas of practice are corporate law, shipping, offshore, ship financ-ing and transactions.

Linda Rudolfsen Myklebust works with the firm’s Banking and Finance Group. She has periodically worked at Wikborg Rein’s offices in London and Singapore. Her main areas of practice are issues relating to

finance, mortgage law, contract law, company law and maritime law. She speaks English and German fluently.

COVER PHOTO and photos on pages 10, 14 and 21: © O. Kobayashi (http://shipphoto.exblog.jp), reprinted with his kind permission

Hågen Hansen specialises on issues relating to the shipping and offshore industry. He has studied international law at University of Cape Town, South Africa.


www.wr.no

COVER PHOTO and photos on pages 10, 14 and 21: © O. Kobayashi (http://shipphoto.exblog.jp), reprinted with his kind permission

THE MEMBERS OF WIKBORG REIN’S SHIPPING OFFSHORE GROUP:

www.wr.no

Oslo Trond Eilertsen(+4�) 22 82 �6 12, [email protected]

Haakon Stang Lund(+4�) 22 82 �6 05, [email protected]

Erling C. Hjort(+4�) 22 82 �6 01, [email protected]

Bernhard Haukali(+4�) 22 82 �6 16, [email protected]

Finn Bjørnstad(+4�) 22 82 �6 11 , [email protected]

Johan Rasmussen(+4�) 22 82 �6 35, [email protected]

Anders W. Færden(+4�) 22 82 �5 44, [email protected]

Gaute Gjelsten(+4�) 22 82 �6 31, [email protected]

Marie Efpraxiadis Andersen(+4�) 22 82 �5 15, [email protected]

Eirin M. Inderberg(+4�) 22 82 �6 4�, [email protected]

Anette Jahr(+4�) 22 82 �6 26, [email protected]

Martin Nes(+4�) 22 82 �6 55, [email protected]

Henrik Hagberg(+4�) 22 82 �5 52, [email protected] Alexander W. Owesen(+4�) 22 82 �6 �8, [email protected]

Louis Skyner(+4�) 22 82 �5 95, [email protected]

Eirik Thomassen(+4�) 22 82 �5 31, [email protected]

Simone Trondal(+4�) 22 82 �6 34, [email protected]

Mats E. Sæther(+4�) 22 82 �6 86, [email protected]

Herman Steen(+4�) 22 82 �5 94, [email protected]

Gry Bratvold(+4�) 22 82 �5 3�, [email protected]

Ena Barder(+4�) 22 82 �5 45, [email protected]

Ingrid Lind Groh(+4�) 22 82 �5 40, [email protected]

Bergen Øystein Meland(+4�) 55 21 52 �5, [email protected]

Jon Heimset(+4�) 55 21 52 �2, [email protected]

Geir Ove Røberg(+4�) 55 21 52 65, [email protected]

Christian Friis(+4�) 55 21 52 35, [email protected]

Lars Inge Ørstavik(+4�) 55 21 52 69, [email protected]

Siri Birgitte Bang(+4�) 55 21 52 �1, [email protected]

Terje Fiskerstrand(+4�) 55 21 52 56, [email protected]

Linn Hertwig Eidsheim(+4�) 55 21 52 96, [email protected]

Linda Rudolfsen Myklebust(+4�) 55 21 52 30, [email protected]

Øyvind Axe(+4�) 55 21 52 66, [email protected]

Kristoffer Larsen Rognvik(+4�) 55 21 52 68, [email protected]

Lars Tormodsgard(+4�) 55 21 52 �0, [email protected]

Christian James-Olsen(+4�) 55 21 52 50, [email protected]

Hågen Hansen(+4�) 55 21 52 51, [email protected]

London Morten Lund Mathisen(+44) 20 �2 36 45 98, [email protected]

Stephen N. Lamb(+44) 20 �2 36 45 98, [email protected]

Gøran Lunde Aarvik(+44) 20 �2 36 45 98, [email protected]

Ola Berg Lande(+44) 20 �2 36 45 98, [email protected]

Singapore Stephen W. Fordham(+65) 64 38 44 98, [email protected]

Erlend Holstrøm(+65) 64 38 44 98, [email protected]

Florence Ong(+65) 64 38 44 98, [email protected]

Chuen Yee Chee(+65) 64 38 44 98, [email protected]

Probin S. Dass(+65) 64 38 44 98, [email protected]

Birgitte Karlsen(+65) 64 38 44 98, [email protected]

Kobe Oddbjørn Slinning(+81) �8 2�2 1� ��, [email protected]

Shanghai Yafeng Sun(+86) 21 63 39 01 01, [email protected]

Lars Berge Andersen(+86) 21 63 39 01 01, [email protected]

Deborah Yu(+86) 21 63 39 01 01, [email protected]

Maggie Pan(+86) 21 63 39 01 01, [email protected]

Joanna Zhao (+86) 21 63 39 01 01, [email protected]

So Update 1 In 2006

Documents

Transcript of So Update 1 In 2006