BIMCO officially releases biofuel clause for time charter parties to address legal and operational challenges arising from the growing use of low-carbon fuels in the shipping industry.
As the shipping industry advances its decarbonization process, the regulatory framework is reshaping shipowners’ fuel usage strategies. However, incorporating biofuel clauses into charter parties involves certain complexities, often raising issues related to fuel quality, engine compatibility, and liability allocation.
The clause clearly defines relevant terms, includes established fuel specifications compliant with ISO standards, and establishes standardized procedures for biofuel sampling, testing, storage, and handling. At the same time, the clause sets out a performance adjustment mechanism for the use of fuels with different calorific values, ensuring that the existing speed and fuel consumption guarantees in time charter parties are fairly adjusted.
