Firm Offer

The second rule of paramount importance involves firm offers. It must be remembered that a ship cannot be under firm offer for two or more cargoes at the same time (other than for part cargoes or unless the intended voyage dates were such as to allow both voyages to take place as contracted) as, if both offers were accepted, the vessel could not carry both at the same time. Similarly, a Charterer cannot offer the same cargo to more than one ship at the same time. Even where a Broker is confident his Principal’s firm offer will not be accepted by the other party, only one firm offer at a time can be made. When broking pressure is intense, and when perhaps more than one opportunity presents itself, it may become very difficult to negotiate so as to select the best alternative for a Principal, because it may be that by concentrating upon one order or upon one ship, a second, better alternative slips away. But negotiations cannot be performed by means of offering to more than one party at a time. An original offer must have expired (or been withdrawn) before a second offer is made to the alternative candidate or, at least, a counter-offer received and declined. Naturally a Broker may have to exercise much skill and tact to perform his task effectively in such circumstances, and act in the best interests of his Principal. It is, however, possible to negotiate a ship or a cargo on the basis of being ‘subject open’ or ‘subject unfixed’. In this way the other side receives clear advice that alternative negotiations are being conducted, although some Principals will be unwilling to negotiate on this basis as the alternative business may take precedence, and they would be left with nothing to show for their time and trouble.