Loading and Discharging

It would be useful to step back for a moment and consider where chartering fits into the picture as far as world trade is concerned, we are looking at seaborne trade which, it is estimated, carries well over 90% of international trade when measured by weight. International trade includes goods carried across borders by pipeline, road, rail and air.

In the absence of provisions in the charterparty the role of the owner and charterer in the loading and discharging operations will be determined by the custom of the port where the operation is carried out.

If there is no custom of port to the contrary the charterer is obliged to deliver the cargo upon loading at the ship’s rail where the owner will receive the cargo and stow it in the holds.

At discharge responsibility is again transferred as the cargo crosses the ship’s rail. The situation described in this paragraph is difficult to apply within the context of current cargo handling procedures and the division of responsibility is usually modified by the express terms of the charter.

For the charterer the loading and discharging operations pose two questions, who pays for the loading and discharging and who will be liable for any damage to the cargo during those operations? It will not surprise the majority of readers that there needs to be a set of rules as to how merchants in different countries with different languages buy and sell to each other.

The basic Terms of Sale are set out in the INCOTERMS. The trade needs to have an understanding of what is included in the price the buyer pays for a commodity; in our subject freight is a part of that price. You will appreciate that it is vital to ensure both seller and buyer are fully aware of their legal obligations under the agreed Terms of Sale.