Case studies

Cargo claim - Arrest and quick despatch

A ship was arrested in Red Sea port in connection with an allegation that it had caused an explosion in an adjacent grain silo. The claimants required a bank guarantee for a very considerable amount in order to release the ship but the ship operator and his insurer were  unable to find a bank willing to provide this. Working with the local P&I correspondent, AMSA was able to negotiate a cash settlement with the claimant in four days in an amount that the ship operator and his insurer could accept and have confidence in. The ship was released promptly and a lengthy off-hire dispute with time charterers was avoided.

Cargo claim - Crew intimidation

AMSA made direct representations to the port authority in a remote port in the Horn of Africa to intervene to help stop the physical intimidation of ship’s crew by a powerful local cargo receiver. This successful intervention created time for the ship’s P&I insurer to negotiate a reasonable settlement of a significant cargo damage claim with the cargo’s insurer in Europe.

We subsequently communicated the good co-operation of the port to the government of a neighbouring inland country and this positive feedback turned out to be a tipping point in a process that shortly afterwards led to a transit agreement being reached between the inland country and the port.

Cargo claim - Lack of information

AMSA was instructed to make local investigations in a North Africa country into why a ship laden with bagged rice was not being discharged by the cargo receiver who was a local state owned trading company. The investigation pointed to problems linked to corruption amongst top level officials in this trading company – officials who were too senior for the local P&I correspondent to influence. We used our own connections to establish a link to a close advisor to the country’s President and through this channel were able to find a face-saving solution that allowed the cargo to be discharged and the ship to sail.

Major dock damage

AMSA made successful representations on behalf of ship owners, P&I Club and hull insurers to the Minister of Transport in a significant but hard-to-reach Middle Eastern country in order to secure the release of a bulk carrier that had been arrested for over six months after knocking over two brand new container gantry cranes in a new, flagship container handling terminal.

Violent conflict

Violent protests erupted against the crew of a ship in a West Africa port after rumours circulated that the crew had murdered a number of local stowaways discovered hiding on the ship. Although the local authorities did not have the capability to board the ship, which was anchored at a river berth, they were able to withhold the services of the local river pilot necessary for a difficult passage down the river to open sea. AMSA was instructed to make representations to officials in the country’s Ministry of Justice and the local government. We were subsequently able to identify the political pressure that these officials were under which in turn opened the door for a negotiation to provide a face saving solution for the politicians as well as the safety of the ship’s crew. If the ship owners had attended in person then they would have been lynched by a mob or imprisoned by the authorities.

Conflict - oil pollution

A major oil spill outside a densely populated port city in South Asia and the reckless discharge of oil cargo residues into the fresh water supplies of a city in West Africa were made unnecessarily complicated – in the first incident by the despatch of a very combative lawyer to negotiate with the port authority officials and in the second incident by the well-meaning attendance of the ship operator’s top management who were arrested on arrival and put in prison.

AMSA was not instructed in either case. But we haveconsiderable experience in building bridges with officials and politicians in sensitive cases and in creating the trust and confidence that are necessary in order for important and reasonable decisions to be made.

Sensitive situations

A ship at an outer anchorage in a port in South Asia  had completed discharge and had all papers on board necessary for departure. However, before anchors were lifted the Master received notice from the authorities that the ship had been arrested for security in respect of a cargo claim and that the relevant Court order was being taken to the ship by boat. The ship disregarded this notice and sailed. However, shortly after this, the time charterer of a sister ship issued a bill of lading requiring delivery of cargo on board to this same port. AMSA was instructed by the ship owner to meet with officials from the Court and negotiate a deal to ensure that punitive action would not be taken against the sister ship when it arrived to discharge its cargo

Contraband

A ship was detained in a South American country after a container was discovered on board loaded with undeclared weapons. Neither the flag state nor the country of destination had formal diplomatic relations with this country. Although local and international lawyers were instructed and the ship was subsequently released the master was held on shore for many months. Diplomatic sensitivities probably made it difficult for the governments of either the flag state (which was also the country of shipment) or the country of destination to intervene and there was doubtless diplomatic pressure on the local government to adopt a hard line against trades of this kind.

At some point in time the extended detention of the ship’s master would have begun to cause embarrassment to the local government. The issue then would have been how to unwind the situation without breaching broader public policy goals and upsetting key regional allies. The use of lawyers or formal and informal diplomatic channels would risk creating the very sort of precedent that the local government would have been keen to avoid.

What might have been helpful would have been to dispatch a credible mediator from outside the ‘system’ to listen off the record to the local government’s concerns and piece together a narrative that allowed parties to move on without either loss of face or harmful precedent.

Political risk

A product tanker under charter to a bunker supplier was arrested and subsequently confiscated by a West African nation’s navy for supplying bunkers to another ship outside the nation’s territorial waters but inside its EEZ. The ship owners and charterers (who were also the cargo owners) appealed against this confiscation. The fact that the bunker transfer had taken place outside territorial waters gave reason for optimism and it seems unlikely that the navy and government concerned, having made their point, would really want to confiscate an international vessel.

However, the position was made more complicated both by the election of a new government with a mandate to crack down on illegal fuel trades and the subsequent involvement of a high profile government anti-corruption agency in the case. All of a sudden, this became a case that for public policy reasons the Government would / will have difficulty in settling in Court – even though international pressure might provide some incentive.

Again a credible mediator (who is neither the ship owner nor the cargo owners, nor an insurer or lawyer for either, nor a Diplomat nor somebody inside the local ‘system’) might be able to create space for a one-off, transparent face saving deal that will not disrupt public policy ambitions.

Loss prevention

AMSA worked with the local Diplomatic embassy of a Flag State to successfully persuade the Provincial Governor in a Middle Eastern country to intervene to stop a series of bogus, multi-million Dollar cargo claims by a local cartel of steel and plywood importers.

Projects

AMSA carried out a detailed logistics study for private investors of the port of Um Qasr in Iraq in 2003 (after the fall of the Saddam Hussein). We also performed detailed operational assessments of the Somali ports of Mogadishu and El Maan (2006) and Kismayo (2008) for a United Nations agency and Hobyo (2011) for private investors and the regional Gal-Mudug government.

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