Owners of bulk carriers engaged in the carriage of coal and iron ore from Australia and Brazil have for some time been aware that the marketability of their vessels could be severly limited unless their vessels had RightShip approval.

The High Court in London, in a dispute between Seagate Shipping/Glencore and Swiss Marine services regarding the Silver Constellation, held that under Clause 8 of the NYPE Standard Form the Owners were obliged to permit a RightShip inspection of the vessel and other RightShip vetting procedures as and when required by the Charterers.

RightShip Pty Ltd is a private limited liability company formed in 2001, the shareholders of which are BHP Billiton, Rio Tinto and Cargill. RightShip describes itself as,

a boutique ship vetting specialist promoting safety and efficiency in the global maritime industry ...

RightShip vetting involves the risk assessment of a number of factors such as the Owner, managers/operators, the age of a vessel, casualty history, port state control, history, identity of class, class conditions and class changes, trading pattern and cargo history, technical inspections and ISPS certification.

RightShip vetting is based on three key risk categories on a scale from 1 to 5 Star. Vessels with 1 or 2 Star rating are deemed to be an unacceptable risk, and are therefore rejected by Shippers/Charterers.

It is not uncommon for even well maintained vessels to fail achieving the all important 3-5 star rating. In particular vessels older than 25 years are required by RightShip to enrol in a continuous assessment programme (“CAP”) with one of the classification societies authorised/recognised by RightShip to carry out such assessments. The list of classification societies recognised by RightShip to carry out CAP is very limited and the costs of enrolling a vessel for CAP can be substantial.

The consequences of this judgement are far reaching and potentially Charterers in a depressed market may be able to walk away from a charterparty, if a RightShip inspection of a vessel does not meet the vetting criteria of RightShip.


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