BIMCO Intervention – A DIY Approach to Dispute Resolution?
July 26th, 2022
Pursuing unpaid debts can be a difficult task. Many ship-owning companies are one-ship companies, which can complicate matters.
Recognising this issue, BIMCO, the leading international organisation representing shipowners, charterers, shipbrokers, and other shipping agents, offers a service to facilitate recovery of unpaid debts: BIMCO Intervention.
BIMCO Intervention is a free-of-charge service provided that:
- The party requesting BIMCO Intervention is a BIMCO Member;
- A notification to BIMCO for accessing these services comes directly from the BIMCO Member for its own interest; and
- The sums in question are undisputed.
Who/What is BIMCO Intervention for?
This a service which is only available to BIMCO Members; for example:
- A shipowner owed money under a Charterparty;
- A Seller demanding payment of the purchase price under a Sale Contract;
- An agent or broker having difficulty recovering their expenses, agency fees/commissions;
- An insurer or P&I Club to whom claims are subrogated; or
- A successful judgment debtor/party to an arbitration award.
Members can ask BIMCO for assistance in recovering the sums which are due to them, provided they can show that the sums claimed were agreed between parties and are not in dispute.
How to Access BIMCO Intervention
There is no prescribed format to access BIMCO Intervention; Members are asked to notify BIMCO’s front office.
A brief outline of the process is as follows:
- The Member presents a summary of their case to BIMCO.
- The case summary should include a copy of all relevant background material i.e. contractual agreements, contemporaneous correspondence between parties, any form of acknowledgment of a debt due and owed.
- A copy of any judgment or arbitration award which was obtained by the Member against the defaulting party.
- Finally, a request to BIMCO to intervene on Members’ behalf against the defaulting contractual party.
In our experience, an email is sufficient for requesting BIMCO Intervention. However, it is necessary to ensure that BIMCO is provided with all the relevant documents.
The Secretariat contacts the alleged defaulting party with the information provided by the requesting party and requests the defaulting party either to:
- Provide a suitable response justifying the default; or
- Promptly comply either with their contractual obligations or the Court judgment/arbitration award, as the case may be.
BIMCO will issue a Notice if the defaulting party fails to respond to BIMCO’s Intervention. The Notice is circulated to all BIMCO members informing them that the defaulting party is a company which has failed to pay its debts.
BIMCO Intervention can be a powerful tool to force commercial parties to pay the debts they owe; particularly in an industry in which reputation can be very important to new and existing business opportunities.
Obtaining early legal advice can often be helpful for a party to present their case in the best possible manner.
Further information on BIMCO Intervention can be accessed on BIMCO’s website.
This article was prepared by Arnavi Panda. Arnavi frequently advises a wide range of clients including shipowners, charterers, managers and cargo interests to facilitate successful claim recoveries through commercial settlement and in Arbitration.
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