06/11/2023

Module
LOGISTICS AND INTERNATIONAL
FREIGHT FORWARDING

Lecturer: Dr. Nguyễn Thị Bình

Department of Logistics và Quản lý chuỗi cung ứng
School of Economics & International Business
Tel: 036 977 03307
Email: ntbinh@ftu.edu.vn

CHAPTER 2

SHIPPING

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1. SHIPING AND INTERNATIONAL TRADE

1.1. Role of shipping

▪ Account for 80% of the volume of goods in international trade

▪ Suitable for the transportation of all kinds of goods

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1.2. Characteristics

▪ High capacity for trade volume

▪ Adaptability to cargoes of varying sizes, weights, and shapes
▪ Low unit transportation cost
▪ Minimal fuel consumption per ton

However….

▪ The choice of transport route is influenced by various natural and maritime

conditions
▪ Low speed
▪ Lower punctuality compared to road or air transportation
▪ Sea transport can entail certain risks

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2. SHIPPING INFRASTRUCTURE

2.1. Merchant vessels

2.1.1. Concept

▪ As freight and passenger ships for commercial

purposes (According to Institute of Maritime Economics
and Logistics Bermen)
▪ Scope of study: freight vessels

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2.1.2. Classification

❖ Based on its use

▪ Passenger ship
▪ Cargo ship
▪ Cargo ship:
▪ Dry cargo ships
▪ Liquid cargo ships General cargo ship

Dry cargo vessels Bulk cargo ships

Ship transporting solid cargo, with or Combined ship

without packaging, or liquid cargo with
packaging Container ship

Ship carrying barges

Frozen cargo ship

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Tankers

Liquid cargo ship Other liquid cargo ships:

Wine…

Gas carrier

Liquefied gas ship

Oil tanker Liquefied gas ship

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❖ Size of ship
▪ Very large ship: Capacity > 350.000 dead weight tonnage (DWT)

▪ Large ships: Capacity from 200,000 DWT to 350.000 DWT

▪ Medium-sized ship: Capacity < 200,000 DWT

▪ Small ship

The largest tanker in the world: Mont

- Maximum payload: 564,763 tons
- Draught: 24.6 meters
- Length: 458.45 meters.
- Width: 68.8 meters.

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❖ Flag:
▪ Conventional flag:

▪ Flag of convenience

Why?
▪ In term of ship owner…
▪ In terms of flag rental country…

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❖ Mode of business:
▪ Liner service: operates according to a predetermined schedule and
follows a fixed port rotation with publicly available dates for calls at
specified ports

▪ Tramp service: It lacks a fixed routing, itinerary, or schedule and is

available on short notice (or fixture) to load cargo from any port to
any port.

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2.1.3. Technical Specification

▪ Ship’s name ▪ Deadweight tons (Carrying capacity)

▪ Flag ▪ Gros/Net Registered Tonnage
▪ Ship owner ▪ Cargo space
▪ Length/Width (Beam) ▪ Coefficient of Loading-CL
▪ Draught ▪ Stowage Factor-SF
▪ Displacement

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(1) Ship’s name

▪ Nouns or symbols
▪ Accepted by the registry
▪ Meaning: used to manage, deliver, receive goods, and determine whether the
carrier has fulfilled his obligations or not

(2) Flag: ship's nationality

▪ Types: Conventional flag and flag of convienience
▪ Conventional flag?
▪ Flag of convienience?

Why?

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(3) Ship owner

▪ Who owns the ship

▪ Differentiate shipowner and chatterer ?

(4) Length/Beam
▪ Length over all (LOA) ):
▪ the greatest length of the ship, from front to back

▪ Beam:
▪ the overall width of the ship measured at the
widest point of the nominal waterline

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(5) Draught

▪ The distance from the bottom of the ship to the

waterline
▪ Unit: meter or foot (1 foot = 0.3048m)

Allows to know how deep a ship can enter and

exit ports, travel on rivers, canals ...

▪ 2 types of draught
▪ Light draught:
▪ Loaded draught

Depending on: Volume of goods transported ; season and sea conditions

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(6) Displacement

▪ The weight of the ship and all that it contains- cargo, fuel, water, stores, crew and
effects.
▪ How can you measure it?
▪ Measured indirectly: first calculating the volume of water displaced by
the ship, and then calculating the weight of that water
▪ Notations:
▪ D: Displacement
▪ M: the volume of water displaced by the ship
𝑴
𝑫= Unit: long tons, meter tons
𝟑𝟓

▪ 2 types of displacement:
▪ LD- Light Displacement
▪ HD- Heavy Displacement

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(7) Carrying Capacity

▪ Ship’s capacity

▪ Deadweight Capacity – DWC/Deadweight tonnage: the weight (in tons) of

all the cargo, fuel, dry provisions, supplies, etc. carried on board
▪ it is the “displacement tonnage” of the vessel minus the “lightweight tonnage”

𝐷𝑊𝐶 = 𝐻𝐷 − 𝐿𝐷

▪ Deadweight Cargo Capacity – DWCC:

This is the part of the available deadweight
for carriage of cargo; quantities of fuel,
water and stores, etc. are not included

𝐷𝑊𝐶𝐶 = 𝐷𝑊𝐶 − (𝑤𝑒𝑖𝑔ℎ𝑡 𝑜𝑓𝑜𝑓 𝑓𝑢𝑒𝑙, 𝑤𝑎𝑡𝑒𝑟 𝑎𝑛𝑑 𝑠𝑡𝑜𝑟𝑒𝑠, 𝑒𝑡𝑐)

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(8) Gross/Net Registered Tonnage

▪ Gross Registered Tonnage: A measurement of

volume of all enclosed spaces on a ship
▪ Unit: m3, cubic feet (100 cubic feet = to one ton)
Example: if the total cubic volume of all the enclosed
spaces on a ship were 350,000 cubic feet, the gross
registered tonnage will most likely be 3500 gross tons
(350,000 cu. feet/100 cu feet/ton = 3500 Gross Tons)

▪ Net Register Tonnage : measurement of volume

of actual cargo storage areas

What are these indicators used for?

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(9) Cargo Space - CS

▪ The part of the ship that contains cargo holds

▪ Bale Cube: The space available for cargo
measured in cubic metres or feet .
▪ Calculate: Length x Width x Height (Holds)

▪ Grain Cube:
▪ It is a measurement of capacity for cargoes such
as grain, where the cargo flows conform to the
shape of the ship
▪ > 5-10% capacity of Bale cube
▪ Why?

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(10) Coefficient of Loading-CL

▪ The relationship between cargo space and Deadweight Cargo Capacity

𝐶𝑆
𝐶𝐿 =
𝐷𝑊𝐶𝐶

1 DWCC equals to how many cargo space in the hold

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(11) Stowage Factor-SF

▪ The relationship between the volume and weight of the commodity, when
the cargo is loaded in the holds

1 long ton equals to how many volume of cargo space in the hold

▪ Depending on the type of commodity

▪ SF <= 40 c.ft/tấn ……> Measurement Cargo
▪ SF > 40 c.ft/tấn ……> Deadweight Cargo

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3. SEA PORT

Definition, Roles
▪ Definition
▪ A land facility designated for reception of
personnel or material transported by sea
▪ Authorized as a port of entry into or departure
from the country in which it is situated

▪ Roles
▪ To serve ships
▪ To serve cargo

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More specifically…
▪ To ensure safety for seagoing vessels entering, operating in and leaving the
seaports
▪ To provide facilities and equipment necessary for seagoing vessels to anchor,
load and unload cargoes,embark and disembark passengers
▪ To provide cargo transportation, loading and unloading, warehousing and
preservation services in the seaports
▪ To provide shelter, repair, maintenance or necessary services to seagoing
vessels and other crafts in emergency cases
▪ To provide other services for seagoing vessels, people and cargoes.

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Requirement for an efficient port

▪ Well- equipped with the most modern handling facilities;
▪ A well- organized container yard, for both storage and handling of containers;
▪ Immediate availability of fresh water and bunker supplies for vessels
alongside (at berth);
▪ A high-end computerized system to control the smooth delivery of cargo to
and from the port, to avoid any congestion and delays;
▪ A good, highly trained and qualified workforce working 24/7
▪ A good rail/road/barge network to facilitate delivery;
▪ An efficient Customs clearance system;
▪ Foresight and forward planning to ensure that there are always enough berths
available, to handle larger and faster container ships;
▪ A computer system that allows the automation of routine operations in the
ports, that can be handle by remote control device; and
▪ Making the port as customer- oriented as possible, and having a user- friendly
tariff system.

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Facility

▪ Equipment for ships entering, leaving and

anchoring: wharf, canal, embankment,
breakwater, signal information system…

▪ Handling goods equiqment: All kinds of cranes, forklifts, pump,

conveyor….

Xe nâng Băng chuyền/Conveyor

Cẩu giàn/Gantry crane container/Container forklift

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▪ Port performance indicators

▪ Average number of calls

▪ Average flow of volume or weight–of goods over a standard period of
time;
▪ Number of calls per berth and per year
▪ Volume or weight of cargo handled per hour, or per day, per gang or
per crane

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4. LINER CHARTER

4.1 Definition, characteristics

▪ Definition
▪ A liner service is defined as one that operates on a regular sailing
schedule, transporting goods along a predetermined route with fixed ports
of call
▪ Characteristics
▪ Operate among ports with a fixed schedule
▪ All relationships are regulated by Bill of Lading-B/L
▪ All terms and conditions of carrier must be accepted by cargo owner,
without negotiation
▪ Liner freight is fixed and be informed in liner bound freight tariff

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Liner Charter Flow

Shippers allow a customs broker or forwarder to locate an
appropriate vessel

The customs broker or forwarder selects a carrier

The customs broker/forwarder and the carrier negotiate several

key terms and conditions, including the cargo name, quantity of
goods, ports of loading, ports of discharge, document insurance

The customs broker/forwarder inform the cargo owner of the

negotiated outcomes

The shipper transports the cargo to the loading port

Upon receiving the goods, the carrier is responsible for issuing Bill
of lading (B/L) to the shipper
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4.2 Ocean Bill of Lading (B/L)

▪ Definition
▪ The B/L is the main document used in
international maritime transport. It is issued
by a carrier or representative of the carrier,
once cargo has been loaded on board or
received for shipment

Who issues B/L?

▪ Carrier
▪ Representative of the carrier

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Functions

▪ It serves as proof of Contract of Carriage

▪ Containing the terms and condition under which the goods
transportation will be carried out

▪ Receipt of the Shipment

▪ Serves as evidence that the carrier has received the cargo in accordance
with the contract, and the goods have been received in good condition

▪ As a Certificate of Title
▪ Serves as a document that proves ownership of the holder of the Bill of
Lading when the goods are finally delivered at a predetermined destination
▪ As a Negotiable Document which maybe transferred to the others
▪ Why?

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Number of issues

▪ Usually, issue 1 set of bill of lading including 03

Originals + Copies
▪ The number of originals is also indicated in the B / L, in
the box “No. of Original Bill of Lading”
▪ On copies will include text “Copy- non negotiable
▪ When paying for goods by L / C method, the seller /
exporter must present the full set of original bill of
lading for the payment to be made.

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B/L Classification

Base on the negotiable ability Vận đơn theo lệnh (Order B/L)
of B/L Vận đơn đích danh (Straight B/L)
Vận đơn cho người cầm (B/L to Bearer)
Base on the issuing time Vận đơn đã xếp hàng (Shipped in Board B/L)
Vận đơn nhận để xếp (Received for Shipment B/L)
Base on comments/ remarks Vận đơn sạch/hoàn hảo (Clean B/L)
B/L Vận đơn không hoàn hảo (Unclean B/L)

Based on the transport Vận đơn đi thẳng (Direct B/L)

itinerary Vận đơn đi suốt (Throught B/L)
Vận đơn đa phương thức (VT liên hợp)
Vận đơn do người giao nhận cấp
Others - Vận đơn đa phương thức của FIATA
- Forwarder’s Certificate of Transport
- House B/L
Vận đơn theo HĐ thuê tàu
Vận đơn đã xuất trình tại cảng gửi (B/L Surrendered)
Giấy gửi hàng đường biển (Sea Waybill)
Biên lai thuyền phó (Mate’s receipt)
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(1) Base on the negotiable ability of B/L

▪ Order B/L (Vận đơn theo lệnh)

▪ Definition: B/L that made out to the order of a specific person (shipper,
consignee or bank) for delivery of the goods, and which can be
transferred to third parties by endorsement
+) to order of shipper
+) to order of consignee
+) to order of bank
 The order B/L can be negotiated by endorsement procedure.

▪ Endorsement is a procedure of transferring of cargo ownership from

original cargo owner to another beneficiary.
▪ On the reverse side of B/L, endorser has to give his signature, stamp and hand
it to endorsee, which is the next beneficiary of the shipment.
▪ In terms of legal side, endorsement is an action to confirm that the cargo owner
has given up the right of the shipments that specified in the B/L to another
beneficiary

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Different types of endorsement:

▪ Straight: Endorser clearly states the name of the beneficiary (Deliver to…) --→ Order
B/L
▪ To oder: The endorser designates the next beneficiary in the order. The continues until
the final beneficiary (designated as "to the order of... (only)") is reached.

▪ Blank: It's an indication that there is no specified recipient for the endorsed bill. In such
cases, the consignee section of the bill of lading will either state "to order" or "to order
of," or it may be left blan

▪ An endorsement "without recourse" :

▪ Eg: CompanyA sells goods to company B---→ Company B endorsements to the
order of… without endorsement to company C ---→ If there is a dispute, the
company Company C is not allowed to pursue a claim to company B

The endorser has to:

Make an endorsement by his language to assure that he has definitely
agreed to transfer the shipment to another person.
Make an endorsement in original B/L

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Ví dụ

Bán hàng Bán lại

B/L
(to order of B
Công ty A (cty XK) Công ty B (cty NK)
Company) Công ty C ở Nhật
ở VN ở Nhật
Công ty C muốn nhận hàng hoặc tiếp tục bán lại lô hàng cho ngưởi khác?
▪ B đóng dấu ký tên vào mặt sau và ghi dòng chữ “Deliver to C” thì chỉ có C mới lên hãng tàu nhận D/O
lấy hàng được …..> Ký hậu đích danh
▪ Vì một lý do nào đó mà C huỷ hợp đồng với B, lúc này B sẽ ghi “Deliver to myself”. Lúc này B sẽ là
người đi lấy hàng …..> Ký hậu đích danh
▪ B ghi vào mặt sau chữ “Deliver to order of C - Giao hàng theo lệnh của C” thì C có thể lại tiếp tục
được chuyển nhượng vận đơn cho người tiếp theo bẳng cách ký hậu thêm một lần nữa ở phía mặt
sau của vận đơn
▪ B chỉ đóng dấu ký tên vào mặt sau và không ghi gì cả. Kiểu ký hậu này gọi là Ký hậu vô danh. Lúc
này, C hay bất cứ người nào cầm được vận đơn đã ký hậu này đề có thể lấy được hàng và sở hữu lô
hàng

Trong trường hợp lô hàng hoá C nhận được có vấn đề về số lượng/chất

lượng?
▪ C yêu cầu B liên đới chịu trách nhiệm. Nếu B không muốn liên đới chịu trách nhiệm thì khi ký hậu, B
ghi thêm câu “Without recourse endorsement”
▪ B ghi thêm câu: “With recourse endorsement, B phải chịu trách nhiệm

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▪ Straight B/L (Vận đơn đích danh )

▪ Defintion: B/L that clearly states name and address of the consignee. NO or
REMOVE the word "Or Oder"

▪ States that the goods are consigned to a specified person

▪ Is non- negotiable document
▪ Is used where the goods have been paid for or do not require payment (donation
or gifts)
▪ The shipping company will deliver the shipment to its consignee on presentation
of an identification

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B/L to Bearer (Vận đơn vô danh )

▪ Definition: This bill states that delivery

shall be made to whosoever holds the bill.
Such bill may be created explicitly or it is
an order bill that fails to nominate the
consignee whether in its original form or
through an endorsement in blank

▪ This document allows the goods to be delivered to the holder of

it
▪ The name of the consignee, to whom the goods have been sent
may be stated as “bearer”.
▪ This B/L can be simply transferred by handing the document.

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(2) Base on the issuing time

▪ Shipped on Board B/L(Vận đơn đã xếp hàng )

▪ Definbition: B/L that is released after cargo is pass vessel’s rail. This
document is an important evidence for completing delivery liability of
the sellers

▪ Characteristics:.
▪ Stamp on B/L: On board, Shipped, Shipped
on board
▪ There is a great deal of evidence - proving
that the seller has fulfilled his / her obligation
to deliver the goods under the sales contract,
especially FOB, CIF, CFR

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▪ Received for shipment B/L (Vận đơn nhận để xếp )

▪ Definiition : B/L that is issued after the carrier receive the shipment,
pledge to ship on board, and transport the shipment by the named
vessel.
▪ The goods arrive at the port of departure before
the vessel
▪ The goods arrive at the loading port when the
vessel has not completed all the necessary
conditions to berth the port (pratique,
customs…).
▪ Deliver the goods through a middle man, such
as a forwarder, a multimodal transport operator,
or a consolidator.

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(3) Base on comments/ remarks on B/L

▪ Clean/Perfect B/L (Vận đơn sạch hay hoàn hảo)
▪ Definition: B/L issued by a carrier declaring that the goods have been
received in an appropriate conditions, without the presence of defects,
normally about the appearance and the quantity of goods.

▪ Unclean/ Claused B/L (Vận đơn không sạch)

Definition: A bill of lading that shows a shortfall or damage in the delivered
goods.
Most banks refuse to accept any unclean B/L
 Repairing ways to have clean B/L:
Replace or complement some missing or damaged goods
Repair damaged goods if it is possible
Form a letter of indemnity in order to be paid perfect goods part.

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(4) Based on the transport itinerary

▪ Direct B/L (Vận đơn đi thẳng )
▪ Is used when you know the same vessel that picked up the cargo will
deliver it to its final destination

▪ Throught B/L (Vận đơn đi suốt)

▪ This is a type of Bill of Lading that involves different ships from
origin to destination

▪ Multimodal Transport B/L (Vận đơn đa phương thức )

▪ This is a type of Through Bill of Lading that involves a minimum
of two different modes of transport.

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(5) Others

▪ Sea Waybill (Giấy gửi hàng đường biển )

▪ is used when the shipper decides to release ownership of the cargo
immediately
▪ Similar to the function of a B / L, the only difference is that there is no
non-negotiable function.
▪ The goods can be delivered to the person identified in the document,
not on the original bill of lading
▪ Can speed up processing at the port of destination

Seaway Bill flows

1. When a vessel leave the port, Waybill is issued, not B/L.

2. Export side forwarder send Waybill copy to the Shipper by email.
3. Shipper send the copy of Waybill to the Consignee by email.
4. The importer can pick up D/O, being proved to be the Waybill owner.

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▪ B/L Surrendered (Vận đơn đã xuất trình tại cảng gửi)

▪ Nowadays, due to high speed of a vessel, it may arrive at a port
before Original B/L is issued and reaches an importer

▪ Surrender B/L flow:

1. When a vessel leave the port, B/L is issued by the export side forwarder.
2. The Shipper requests to surrender B/L.
3. The Shipper sends the copy of Surrender B/L to Consignee by email.
4. Once the vessel arrive at the port, D/O is issued by the import side
forwarder.
5. The Consignee can exchange the B/L copy for D/O.

----------→ This allows for speedy trade transactions. It also reduces the risk of
losing B/L.

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Contents of Bill of Lading (B/L)

▪ First side of B/L ▪ Reverse side of B/L

▪ Shipper ▪ Definitions: carrier, shipper, consignee
▪ Consignee ▪ The extent of carrier’s responsibility
▪ Notify party
▪ Vessel ▪ Excepted Perils
▪ Place of receipt ▪ Regulations on loading, discharging,
▪ Place of delivery preserving goods
▪ Port of Loading ▪ Regulations on Freight and Charges
▪ Port of Discharge
▪ Goods War, Strike, riots, civil, commodition
▪ Freight and clauses
Charges ▪ Late delivery clauses
▪ Number of original ▪ General average clause
▪ Place of issue
▪ Both to blame collision clause
▪ Date of issue
▪ Signature ▪ Supreme Clause

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Samples of B/L

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LEGAL SYSTEMS IN SHIPPING

* International Conventions
• International Convention for the unification of certain rules relating to
Bills of lading/ Brusell Convention 1924/ Hague Rules
• Protocol to amend International Convention for the unification of
certain rules relating to Bills of lading/ Visby Protocol 1968/ Hage-
Visby Rules
• SDR Protocol 1979
• United Nation Convention on the carriage of goods by sea/ Hamburg
Convention 1978/ Hamburg Rules

* National law
• Vietnam Maritime Code, 2015

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Carrier’s liability to the goods

▪ Cơ sở trách nhiệm (Basis of Liability): carrier’s liability on losses arising
from loss of or damage to the goods

▪ Thời hạn trách nhiệm (Period of Liability): is a period in which the

carrier remains responsible for losses resulting from loss of or damage
to the goods
▪ Giới hạn trách nhiệm (Limit of Liability): the maximum amount of
money that the carrier should compensate for unit of damaged or
missing goods in case the value of the goods is not specified in B/L or
other documents that confirm the contract of carriage.

Được quy định trong Công ước quốc tế về vận đơn,

thể hiện ở 3 quy tắc: Hague, Hague-Visby, Hamburg

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Basis of Liability
(I) Hague and Hague Visby Rules:
(1) Provide a seaworthy ship
What is a seaworthy ship?

▪ The ship is durable and solid, capable of withstanding normal wind and wave
conditions..
▪ The ship is adequately crewed, equipped, and provisioned for the voyage,
including the provision of fresh water, food, and fuel
▪ All areas of the ship designated for the carriage of goods, such as holds,
refrigerating and cooling chambers, are prepared to receive, transport, and
preserve the goods

(2) Trading liability: “the carrier shall properly and carefully load, handle, stow,
carry, keep, care for, and discharge the goods carried”.

(3) Issuing B/L: after receiving the goods into his charge, the carrier or the master
or agent of the carrier shall, on demand of the shipper, issue to the shipper a B/L.

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Excepted perils (17)

▪ Act, neglect or default of the master, mariner, pilot or the servants of the carrier in the navigation or in the
management of the ship.
▪ Navigation
▪ Management of the ship
▪ Fire, unless caused by the actual fault or privity of the carrier
▪ Perils, dangers and accidents of the sea or other navigable waters
▪ Act of God
▪ Act of war
▪ Act public enemies
▪ Arrest or restraint of princes, rulers or people, or seizure under legal process
▪ Quarantine restrictions
▪ Act or omission of the shipper or owner of the goods, his agent or representativ
▪ Strikes or lockouts or stoppage or restraint of labour from whatever cause, whether partial or general
▪ Riots and civil commotions
▪ Saving or attempting to save life or property at sea
▪ Wastage in bulk of weight or any other loss or damage arising from inherent defect, quality or vice of the
goods
▪ Insufficiency of packing
▪ Insufficiency or inadequacy of marks
▪ Latent defects not discoverable by due diligence
▪ Any other cause arising without the actual fault or privity of the carrier, or without the fault or neglect of the
agents or servants of the carrier, but the burden of proof shall be on the person claiming the benefit of this
exception to show that neither the actual fault or privity of the carrier nor the fault or neglect of the agents or
servants of the carrier contributed to the loss or damage

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(I) Hamburg Rule

▪ Presumed fault or neglect principle: “The carrier is held responsible

if the event leading to loss, damage, or delay occurred while the goods
were under their care. The carrier can only be relieved of liability by
demonstrating that they, their employees, or agents had taken all
necessary measures that could reasonably be expected to prevent the
event and its consequences.”
▪ Delay: When the goods are not delivered at the port of discharge as
specified in the Transport Agreement within the agreed time
▪ When a determined time is not specified, the concept of delivery time
takes into consideration a reasonable duration that a diligent carrier
would require, considering the circumstances of the incident.
▪ Goods will be considered lost: If they are not delivered within 60
consecutive days

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Hamburg Rule

No liability and perils listed

Presumed fault or neglect principle

The carrier's responsibility has been greatly increased

Eliminate “Navigation Faults”

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Period of liability

is a period in which the carrier is liable for losses arising from loss of or
damage to the goods.

(I) Hague và Hague-Visby Rule:

▪ “Carriage of goods covers the period from the time the goods are loaded on to
the time they are discharged from the ship”

From “tackle to tackle”

(I) Hamburg Rule:

▪ “The responsibility of the carrier for the goods under this Convention covers
the period during which the carrier is in charge of the goods at the location
of loading, throughout the course of carriage, and at the place of discharge.”

From “Port to Port”

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(II) Hamburg Rule (cont.):

The carrier is deemed to be in charge of the goods:
a) from the time he has taken the goods from:
i) the shipper, or a person acting on his behalf; or
ii) an authority or other third party to whom, pursuant to law or regulations
applicable at the port of loading, the goods must be handed over for shipment;
b) until the time he has delivered the goods:
i) by handing over the goods to consignee; or
ii) in cases where the consignee does not receive the goods from the
carrier, by placing them at the disposal of the consignee in accordance with the
contract or with the law or with usage of the particular trade, applicable at the port
of discharge, or
iii) by handing over the goods to an authority or other third party to whom,
pursuant to law or regulations applicable at the port of discharge, the goods must
be handed over.

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Limitation of liability
▪ The maximum amount of money that the carrier is obligated to compensate for each
unit of damaged or missing goods when the value of the goods is not specified in the
Bill of Lading (B/L) or other documents that confirm the contract of carriage

(I) Hague rules

▪ 100 GBP per unit or package of missing or damaged goods
(II) Hague-Visby rules
▪ 10 000 francs per package or unit or 30 franc per kilo of gross weight of the
goods lost or damaged, whichever is the higher.
▪ A franc means a unit consisting of 65.5 miligrammes of gold of millesimal
fineness 900
▪ For those goods that are consolidated in container, pallet or other transport
articles:
▪ If the B/L does not enumerate what is contained in the container, the container is
one shipping unit
▪ If the B/L enumerates the contents of the container individually, each of the
packages is a unit
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(III) SDR Protocol

▪ SDR Protocol: 666.67 units of account per package or unit or 2 units of account
per kilo of gross weight of the goods lost or damaged, whichever is the higher.
▪ The unit of account is the SDR as defined by the IMF
(IV) Hamburg rules
▪ 835 SDR per package or unit or 2.5 SDR per kilo of gross weight of the goods
lost or damaged, whichever is the higher.
▪ For those goods that are consolidated in container or other transport articles:
▪ If the B/L does not enumerate what is contained in the container, the
container is one shipping unit
▪ If the B/L enumerates the contents of the container individually, each of the
packages is a unit
▪ In case where the article of transport itself has been lost or damaged, the
article of transport, if not owned or otherwise supplied by the carrier, is
considered one separating shipping unit

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Summary

• There are 2 international legal systems that are applied in shipping

field (Hague and Hamburg Rules)
• The Hamburg Rules effect a more balance and equitable allocation of
risks and responsibilities between carriers and cargo owners
• Progressive points of Hamburg Rules:
– Carrier’s liability is based on the principle of presumed fault or neglect
– Regulates of Deck cargo, live animals, cargo consolidated in containers,
pallets and other transport articles
– Regulates liabilities of contracting carriers and actual carriers

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Maritime Code of Vietnam, 2015

*Period of Liability
- Art. 74: “The responsibility of the carrier for the goods under this Code covers the period
during which the carrier is in charge of the goods at the port of loading, during the
carriage and at the port of discharge.”

*Basis of liability
- Extend of liability: loss, damage, and delay in delivery
- Enumerate 3 main liabilities and 17 excepted perils for the carrier, but the carrier may
escape liability only if he proves that he, his servants or agent took all measures that
could reasonably required to avoid the occurrence and its consequences .

* Limits of liability
- 666.67 units of account per package or unit or 2units of account per kilo of gross weight of
the goods lost or damaged, whichever is the higher.
The unit of account is the SDR as defined by the IMF
This amount of money is converted at the exchange rate that officially announced in
Vietcombank at the time of making payment
- Goods consolidated in containers, pallets and other transport articles: same as the
Hague Visby rules
- Delay in delivery: same as the Hamburg rules

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CLAIMS AND ACTIONS

▪ Notice of loss, damage or delay
▪ Notice of loss, damage or delay is the consignee’s notice in writing
specifying the general nature of such loss or damage, which sent to the
carrier in a certain period of time
▪ Method:
Cargo Outturn Hague, Hague-Visby Rules
Report- COR Before or at the time of delivery the goods
Hamburg Rules
(The consignee send to
the carrier) - not later than the working day after the day when
the goods were handed over to the consignee.
If the loss or damage
is apparent Hague, Hague-Visby Rules
Letter of - 3 days after the day when the goods
Reservation– LOR were handed over to the consignee
Hamburg Rules
(The consignee send to
the carrier) ) - 15 consecutive days after the day when the
If the loss or damage is not apparent goods were handed over to the consignee

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▪ Delay (only in Hamburg rules)

▪ Delay in delivery (for Hamburg rules only): the notice has been given in
writing to the carrier within 60 consecutive days after the day when the
goods were handed over to the consignee

▪ Claimer
Who?
▪ Người gửi hàng (Shipper), nếu vận đơn chưa ký hậu để chuyển nhượng
▪ Người nhận hàng (Consignee)
▪ Người cầm vận đơn (Holder of B/L)
▪ Người bảo hiểm (Insurer): Theo nguyên tắc thế quyền (Subrogation)

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▪ Limitation of Actions

any action to the carriage of goods under this rules is

Hague rules time- barred if judicial or arbitral proceedings have not
been instituted within the period of 1 year

The one-year time limit may be extended for a

Hague-Visby rules
period of up to three months

2 years and may be extended at any time during

Hamburg rules the running of the limitation period by a written
declaration to the claimant

The limitation period commences on the day when the carrier has delivered
the goods or a portion of them. In cases where no goods have been
delivered, on the last day of which the goods should have been delivered.

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5. VOYAGE CHARTER

5.1 Definition, characteristics

▪ Definition
▪ The method that a ship is chartered for a voyage between specific ports with a
specified cargo at a negotiated rate of freight
▪ Under voyage charters, the charterer pays for the use of the ship’s cargo space for one,
or, in some cases, more than one voyage.

▪ Characteristics

▪ The ship does not run on a fixed schedule but at the request of charterer
▪ All relationships are regulated by Voyage Charter Party-C/P) + B/L
▪ Charterers can freely bargain on the terms of carriage, freight, loading and discharging
expense rates
▪ These vessels generally carry cargo in bulk, such as coal, grain, timber, sugar, ore,
fertilizer, cement clinker, copra, bauxite and phosphates
▪ Voyage charter’s speed is relatively slower than liner’s one

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5.2 Voyage Charter Party

▪ Voyage charter party (C/P):
▪ Defined as a legal contract which is signed between the ship owner and the
charterer, that defined the roles and responsibilities of parties of voyage
charter
▪ The contract finalized covering terms and conditions agreed for the carriage of
the cargo, with aspect like commercial, losses or damage liabilities, security,
etc.

▪ List of voyage charter clauses

▪ Name and the address of the contracting parties
▪ Cargo quantity and description
▪ Ship description and expected time to load (laydays)
▪ Port of loading and port of discharging
▪ Cost of loading and discharging
▪ Freight and payment
▪ Notices of readiness, time counting and demurrage and despatch
▪ Laws and arbitration
▪ Others

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(1) Name and the address of the contracting parties

Người chuyên Người thuê tàu/

chở/Shiping Line Charter

- The two sides can sign the charter party or through their agent / broker to
sign the charter party
- Always specify the name and address of the carrier and ship owner
- Agents or brokers who are authorized to sign charter party must be
specified at the end of the contract

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(2) Cargo quantity and description

▪ Relevant regulations specifying the name of the goods, the type of

package, the symbol, the weight, the quantity and the nature of the
danger of the goods (if any)

▪ Name of cargo: Clearly states the name of cargo; And/or (eg. 1000 MT
rice and/or maize); And/or any lawful goods
▪ Packing: types of packing, marks and numbers
▪ Quantity: X metric tons (+)/or (-) tolerance level (which is decided by
Master/shipower/Charterer)

5% more or less in Owners’ option (moloo)

5% more or less in charterers’ option (molco)
5% more or less in Master’s option (molmo)

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(3) Ship description

▪ the name of the ship: “Ship named Hope and/or substitute sister ship”
▪ the age of the vessel
▪ the flag
▪ the type of ship
▪ the speed of the ship
▪ the classification society and the class
▪ the length and breadth
▪ the draught

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4) Expected time for loading (laydays)

▪ Regulate the time for ship being at port and ready for loading
▪ 2 methods:
▪ On a specific day
▪ In a certain period of time

▪ Proving a ship arrived at port and ready to load or unload

▪ The vessel has arrived in the commercial area of the port (loading area, or
waiting at wharf)
▪ The vessel is completely ready in term of:
▪ Complete procedures to enter the port (customs, sanitary and
epidemiology)
▪ Adequate technical facilities, clean holds, and appropriate temperatures

▪ Sending Notice of Readiness (NOR) to charterer or consignee in an approciate

way (fax, email, telex) …..>> Very important condition to start counting
laytime
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(4) Expected time for loading (laydays) (continued)

Canceling date: the latest date on which the vessel must be ready to load at
the port.

▪ Charterers may cancel the contract if the vessel does not arrive on the
agreed date:
▪ Eg: LAYCAN: 20th April 2020 -→ Tàu không đến ngày đó thì hủy HĐ
LAYCAN: 20th -24th April 2020 --→ Nếu tàu không đến ngày 20 thì đợi thêm và
hết ngày 23/4 sẽ hủy HĐ
(LAYCAN = LAYDAYs/CANCELLING DATE = Ngày tàu đến/Hủy HĐ)

▪ Should charterers always cancel the contract when the ship is late?
▪ Depending on:
▪ Is fast and easy to hire new ship?
▪ L/C term has expired yet?
▪ the goods need urgent delivery?
▪ Is the freight charge on the rise?
▪ …

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(5) Port of loading and port of discharging

▪ Name of loading place/ or range, where a vessel is to remain “always

afloat” or “safe ground”
▪ How to regulate?
▪ Only one port: Loading port [name of loading port] – Discharging port [name of
discharging port]
▪ Range of ports: Range of loading port [range of loading port name ] – Range of
discharging port [range of discharging port name ] ---→ Clearly state the loading and
unloading port order, wharves, and the fees for transshipment by whom?

Anyway, the loading and discharging ports in the charter party must be safe
ones in terms of both of nautical and political features.
There is no nautical and political obstacles to reach the port/berth with a loaded
ship
“at all times of the tide always afloat”
“Not always afloat but safely aground (NAABSA)”
Note: “… or so near there to as she may safely get and lie always afloat…”

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(6) Cost of loading and discharging

▪ Accounts for a significant proportion of the freight, so it must be clearly

stated
▪ The owner and charterer can discuss to divide handling cost in the
following ways:
▪ Liner Term/Berth Terms
▪ Free in and out-FIO: As a rule, cargo owners have to pay the cost of loading and
discharging the cargo, it being the duty of charterers to deliver the cargo free alongside at
the port of loading and for consignees to take delivery from alongside at the port of
destination, in each case free of charge to the vessel

▪ Free in -FI: The ship owner is not responsible for loading at the original port but must
bear the discharging at destination port.
▪ Free out -FO: The ship owner is not responsible for discharging at the destination port
but must bear the loading at orginal port.
In addition, clearly state the owner have to bear the cost of stowage or trimming or not ?
If they do not incur this cost, write S or T after the above terms (eg: FIOST, FIS, FOS ...)

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(7) Freight and payment

▪ Freight:
▪ Freight in the ordinary meaning sense, is the reward payable to the carrier for
the carriage and arrival of the goods in a merchantable condition, ready to be
delivered to the merchant”.
▪ Freight rate:
▪ the freight per unit of cargo
▪ Freight unit
▪ weight (heavy goods), volume/ measurement (light goods)
▪ Quantity
▪ On taken quantity
▪ Delivery quantity
▪ Time to pay
▪ In advance: Freight Prepaid/ Freight payable at Loading port
▪ Freight to Collect:
* Freight payable on commencement of discharge
* Freight payable concurrent with discharge
* Freight payable on completion of discharge)
* Freight payable on actual and proper completion of discharge

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(8) Laydays/ Laytime, demurrage and despatch

▪ Laytime/Laydays (Thời gian làm hàng)

▪ is the time, which according to the charter party, is allowed for the loading
and discharging of the cargo (the allowed time)

▪ Manners
▪ According to a fixed number of days/hours which are necessary for the
loading and/or discharging operations
▪ According to a quantity to be loaded or discharged
▪ Without a fixed number of days/hours (with customary dispatch, customary
quick dispatch, as fast as the vessel can receive, etc.)

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(i). Days - Unit expression

* Running days: includes consecutive days including weekends and

holidays
* Working days: Includes consecutive days excluding weekends and
holidays
* Weather Working days: Includes the day on which the weather permits
to continuous work of cargo loading and unloading
➢ Commonly used in CP
▪ WWDSH: WEATHER WORKING DAY SUNDAY AND HOLIDAY
▪ WWDSHEX: WEATHER WORKING DAY SUNDAY AND HOLIDAY EXCEPTED
▪ WWDSHEXUU: WEATHER WORKING DAY SUNDAY AND HOLIDAY EXCEPTED
UNLESS USED
▪ WWDSHEXEU: WEATHER WORKING DAY SUNDAY AND HOLIDAY EXCEPTED
EVEN USED

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(ii) According to a quantity to be loaded or discharged

▪ Apply for bulk cargo, such as coal, ore, cement, fertilizer

▪ tipulate the level of loading and unloading by the capacity of the port
▪ From the level of loading and unloading, how much time is allowed to be
handled?

(iii) Regulations on customary levels of loading and unloading

goods:

▪ Without a fixed number of days/hours (with customary dispatch,

customary quick dispatch, as fast as the vessel can receive, etc.)

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Notices of readiness, time counting

▪ Laytime starts only after three conditions have been fulfilled:

▪ The vessel has become an “arrival ship” within the term of the charter party
▪ The vessel is in all respects ready for loading/unloading
▪ Notice of readiness has been served on the charterers or their agent in accordance
with charter party

---→ The laytime starts from the moment that the NOR is tendered and accepted by
the charterer, unless the charter party stipulates differently

▪ Note: W, W, W, W”
▪ WIPON: Whether in Port or not
▪ WIBON: Whether in Berth or not
▪ WIFON: Whether in Free Pratique or not
▪ WICON: Whether in Custom Cleared or not

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GENCON standard form:

The laytime starts from 1p.m if the NOR is tendered in office hour before
12a.m
The laytime starts from 6 a.m of the next day if the NOR is tendered in office
hour after 12a.m
Excluded time starts from 1p.m of Saturday or of the working day before
holiday to 7a.m of the next Monday or the day after the holiday.

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Demurrage and despatch

* Demurrage
▪ If the ship needs more time to load or discharge than foreseen by the
laydays, then the ship will be in days of demurrage. The Charterer will
have to pay for this a certain compensations to the ship owner called
demurrage.

▪ “Once on demurrage, always on demurrage”.

Demurrage rate = 2 x dispatch rate
Demurrage money = demurrage time X demurrage rate
* Dispatch
▪ A compensation which the ship owner must pay to the charterer when the
ship is loaded and/or discharged more rapidly than provided by the
laydays that were foreseen.
▪ “Dispatch money for all time saved” or “Dispatch money for all
working time saved”
Dispatch = 1/2 x demurrage rate
Dispatch money = Dispatch time X Dispatch rate

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* Calculation of demurrage/ dispatch money

• Mutually complement
• Individually complement
* Statement of facts
• Time sheet:
– Date and hour of arrival in the roads or in the port
– Date and hour of arrival in the loading or discharging place
– Date and hour on which the ship is ready in all respects to start loading or
discharging, as stated in the NOR
– Date and hour on which the NOR was tendered
– Date and hour on which the NOR is accepted by charterer, receiver or his agent
– Date and hour on which, according to the charter,, the laydays started
– Loading and discharging speed according to charter party
– Statement of days, which could not be worked
– Statement of the time allowed for loading and discharging
– Date and hour on which the loading/discharging was terminated

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(8) Carrier/ship owner’s responsibility and exceptions

• Responsibilities:
- To make the vessel in all respects seaworthy by due diligence
- Secure that the vessel is properly manned, equipped, and supplied
- Issue B/L after receiving the goods
- Guide for loading and discharging the shipment
- Liable for loss, damage or delay in delivery of the goods caused by
nautical fault
- Control the vessel with proper speed, avoid deviation unless in case of
force majeure.

• Exceptions:
- Act of God
- Perils of the sea
- Force majeure
- Hostile activities

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Both to Blame Collision

“If the (Carrying) ship comes into collision with another ship as a result of the negligence of the other ship
and any act, neglect or default in the navigation or the management of the carrying ship, the Merchant
undertakes to pay the carrier or where the Carrier is not the owner and in possession of the carrying ship to
pay to the Carrier as trustee for the owner and/or demise charterer of the carrying ship, a sum sufficient to
indemnify the Carrier and/or the owners and/or demise charterer of the carrying ship against all loss or
liability to the other or non carrying ship or her owners, insofar as such loss or liability represents loss of or
damage to or any claim whatsoever of the Merchant, paid or payable by the other or non carrying ship or
her owners to the Merchant and set off recouped or recovered by the other or non carrying ship or her
owners as part of their claim against the carrying ship or her owner or demise charterer or the Carrier. The
foregoing provisions shall also apply where the owners, operators or those in charge of any ship or ships or
objects, other than, or in addition to the colliding ship or objects, are at fault in respect to a collision;
contact, stranding or other accident.”

Tổn thất hàng hoá: 100 Tổn thất hàng hoá: 200

A B

Tàu A chịu 50% lỗi

Tàu B chịu 50% lỗi
Thiệt hại tàu 10
Thiệt hại tàu 20

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• “Chủ hàng phải trả cho người chuyên chở của mình tất cả các mất mát,

thiệt hại và trách nhiệm mà người chuyên chở của mình đã trả cho

người không chuyên chở liên quan đến khiếu nại của chủ hàng”

→ Điều khoản này bảo vệ quyền lợi của người chuyên chở/chủ tàu

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Ví dụ: Nội dung quy định trong thời gian làm hàng, thưởng/phạt xếp dỡ

▪ Hàng sẽ được xếp/dỡ theo mức 1000 MT cho một ngày làm việc thời tiết tốt, chủ
nhật ngày lễ không tính, dù có làm hay không. Thời gian làm hàng sẽ không được
tính từ 13 giờ của ngày thứ bảy hoặc ngày làm việc cuối cùng trước ngày nghỉ lễ đến
7 giờ sáng thứ hai hoặc ngày làm việc đầu tiên sau nghỉ lễ. Thời gian làm hàng bắt
đầu tính sau 12 giờ đồng hồ kể từ khi thuyền trưởng hoặc đại lý của tàu trao thông
báo sẵn sàng xếp dỡ bằng văn bản cho người thuê tàu trong khoảng thời gian từ 9
giờ đến 17 giờ của bất kỳ ngày nào, trừ thứ bảy chủ nhật và ngày lễ, với điều kiện là
tàu đã cập cầu và làm xong các thủ tục. Tiền phạt, nếu có, sẽ do người thuê tàu trả
với mức 2000 USD/ngày hoặc theo tỷ lệ đối với phần của ngày. Tiền thưởng xếp dỡ
nhanh, nếu có, sẽ do chủ tàu trả bằng một nửa tiền mức phạt cho tất cả thời gian tiết
kiệm được. Việc thanh toán thưởng phạt sẽ được tiến hành giữa chủ tàu và người
thuê tàu trong vòng một tháng kể từ ngày thuyền trưởng ký vào Biên bản thực tế.

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