Gypsy Moth Clause Takes Balanced Approach to Risk

 

A new BIMCO clause provides a simple, practical and commercial solution focusing on the basic obligations and responsibilities of owners and charterers when dealing with the Asian Gypsy Moth (AGM).

The spread by ships of AGM poses a severe risk to agricultural resources in many parts of the world. Strict regulations are imposed by authorities in countries such as the United States, Canada, Australia and New Zealand to guard against this invasive and destruction pest. The moths don't cause damage to foliage directly as they do not eat during this short phase of their life, which may last only 2 or 3 weeks. The damage is done by the AGM caterpillar which has a voracious appetite. The risk to shipping comes from the female moth, which can fly distances of up to 40 km to lay eggs on a ship's superstructure or containers if trading during the high risk season in Northern China, Russian Far East, Japan and Korea. If not eradicated, these infestations may be carried to ports in countries where the moth is not native.

The BIMCO Clause is for time charter parties and applies to all life stages of the moth. The basic obligation is for the owners to deliver the ship free of Asian Gypsy Moth and for the charterers to re-deliver it in the same condition at the end of the charter period. A period of two years prior trading applies to the delivery obligation on owners, as this reflects the regulatory requirements in several major trading states.

During the contract the charterers must take measures to reduce the risk of infestation when trading the ship in areas where the AGM is found, and at their expense remove any infestation that does occur.

A copy of the Asian Gypsy Moth Clause for Time Charter Parties can be downloaded from the Clauses section of the BIMCO website and from the Clause Manager for those who subscribe to IDEA•2.