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Ince: Novel Coronavirus (2019-nCoV) Legal issues and Impact on International Trade & Transportation

WHO has declared the outbreak as a Public Health Emergency of International Concern and has proposed certain Temporary Recommendations be issued.
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Wai Yue Loh, Kimarie Cheang, and Cindy Wang, of international law firm Ince on Friday (31 January) published an article reviewing potential contractual issues for the maritime sector due to Novel Coronavirus (nCOV) outbreak:

The novel coronavirus was first reported in late December 2019. The outbreak of the virus originated from the inland city of Wuhan, the capital of the Hubei province, PRC, but has quickly spread to coastal cities within China such as Shanghai, Guangzhou, Shenzhen, Tianjin, etc. Additional cases are identified in a growing number of countries internationally.

By 30 January 2020, the World Health Organisation (WHO) has declared the outbreak as a Public Health Emergency of International Concern (PHEIC) and has proposed certain Temporary Recommendations be issued.

We highlight below some potential contractual issues for consideration.

Safety of the port – Can an Owner refuse to go to an affected port?

Generally, under a time charter, an Owner is obliged to comply with a Charterer’s legitimate employment orders, unless compliance with the Charterer’s order exposes the ship to a safety risk.  It is currently unclear whether the virus is at a stage where it may render a port ‘unsafe’. Although the WHO has declared the outbreak as a PHEIC, it has at the same time recommended that no travel or trade restriction be imposed. However some countries are already implementing a ‘No travel’ policy to China.  Various shipping ports have imposed additional checks and quarantine measures on vessels arriving from China, or those with Chinese crew on board. 

It is accordingly difficult to determine the ‘unsafety’ of an affected port.  This will depend on the facts bearing in mind the evolving situation. If an Owner refuses to follow a Charterer’s order without sufficient grounds, the Charterer may well be entitled to terminate the contract and/or claim damages (depending on whether such conduct can be said to be repudiatory or renunciatory) so an Owner should carefully review its contractual position.   Equally, if an Owner does follow a Charterer’s order(s) and suffers loss as a result, it would most likely be entitled to an indemnity from the Charterer (depending on the terms of the contract).

Quarantine, Off Hire, and Laytime & Demurrage – What happens if a crew member becomes infected?

Under a time charter, an Owner will generally be responsible for matters relating to the crew.  If a crew member becomes infected, the Owners should ensure that the crew member is quarantined and arrange for the treatment and repatriation of the crew member.  Where the illness results from a Charterer’s order, the Owner may be able to claim any costs of repatriation, medical expenses, etc., from the Charterer depending on the terms of the charter. 

Where the ship is in port at the time the symptoms of the virus are discovered on board, it is unlikely that a valid NOR could be tendered.  Laytime & demurrage will therefore not run until a valid NOR can be tendered.

Further, where a vessel has to deviate to obtain medical assistance for its crew member, would the Charterer be entitled to place the ship off hire?  This depends. If the crew member becomes infected as a result of a Charterer’s order, then the deviation may not give rise to off hire unless the Owner is deemed to have accepted the risks of going to an affected port. 

Of course the legal regime is dependent upon individual Charterparty wordings and it would be prudent for all new fixtures to incorporate the BIMCO Infectious or Contagious Diseases Clause.  The provisions were developed following the outbreak of the Ebola virus a few years ago, and are intended for use in response to extreme illness as opposed to more commonly encountered widespread diseases and are based on the principles in BIMCO’s war and piracy clauses.

Force Majeure – Can an affected party rely on FM?

Given the recent declaration by the WHO, force majeure provisions are likely to be increasingly relied upon and invoked by an affected party.  The China Council for the Promotion of International Trade (CCPIT) announced that it would be offering “force majeure certificates” to businesses in China affected by the outbreak of the Coronavirus in Wuhan.  

Whether a party can successfully invoke FM and/or rely on the CCPIT certificates to do so, will depend on the governing law of the contract and the terms of the relevant clause.

As a matter of English law, force majeure is a creature of contract.  Generally a party who seeks to rely on a FM clause bears the burden of showing:

  1. It could not perform its obligations due to the relevant event.
  2. Inability to perform was beyond its control.
  3. There were no reasonable steps the party could have taken to avoid the event or the consequences.

Our initial view is that where the outbreak escalates and has real implications on the operation of businesses (such as the shutting down of business operations as a direct result of the outbreak), this could well fall within the scope of a FM clause. 

Parties are therefore urged to review their FM provisions carefully to ensure that any notification and/or mitigation requirements are complied with, and to gather as much documentary evidence as possible to evidence any relevant FM event. 

Key Takeaways

There is potentially a high degree of business interruption that will ensue, bearing in mind for example that Singapore has now closed its borders to all who have been in China for the last 14 days, the recent British Airways’ suspension of direct flights to and from mainland China, and Hong Kong’s plans to slash cross-border travel between the city and mainland China.  This would all have a significant impact on enterprises, in particular those with staff and management who may have been in China over the festive period. We are already starting to see declarations of force majeure from Chinese entities involved in the shipping and trading spheres.

We reiterate that for your existing contracts, it would be important to identify the risks and exposures arising from the developing situation. Some of these potential issues have been identified above. To reduce the potential for disputes, parties can consider inserting provisions to deal specifically with these issues.  As for your new contracts – if the intention is to insert a clause to deal specifically with the risks of the Coronavirus, it would be important to be clear as to what you are seeking to achieve and to draft the clause(s) accordingly.

This above is not a complete list of issues to be aware of arising from the Coronavirus, and should you have any queries, please do not hesitate to contact the authors of this article.

 

Source: Ince
Photo Credit: Photo by Bill Oxford on Unsplash
Published: 4 February, 2020

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Yang Ming orders six LNG dual-fuel, ammonia-ready containerships from Hanwha Ocean

Each of the six new vessels will have a capacity of up to 13,650 TEU and feature LNG dual-fuel propulsion and Ammonia Fuel Ready specifications.
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Yang Ming orders six LNG dual-fuel, ammonia-ready containerships from Hanwha Ocean

Taiwanese shipping firm Yang Ming Marine Transport Corporation (Yang Ming) and South Korean shipbuilder Hanwha Ocean on Wednesday (2 September) signed a shipbuilding contract for six 13,000 TEU class LNG dual-fuel container vessels. 

The contract was signed by Dr. Chuck Tsai, Chairman of Yang Ming, and Mr. Charles Kim, CEO of Hanwha Ocean. The vessels are scheduled for delivery between 2028 and 2029. 

They will complement Yang Ming’s existing fleet of 10,000+ TEU vessels and serve as key vessels on East-West services, with deployment flexibility across trade lanes connecting Asia with the East and West Coasts of North America, South America, and the Mediterranean. 

Each of the six new vessels will have a capacity of up to 13,650 TEU and feature LNG dual-fuel propulsion and Ammonia Fuel Ready specifications.

“As Yang Ming transitions toward net-zero emissions, LNG provides a relatively mature and economically viable alternative fuel solution, capable of reducing greenhouse gas emissions by approximately 20%,” the company said. 

“At the same time, ammonia can serve as a carbon-free fuel by utilising converted LNG storage facilities, while offering relatively lower conversion costs and comparatively well-developed supply chains and infrastructure. The Ammonia Fuel Ready design will therefore provide Yang Ming with greater flexibility in responding to increasingly stringent international regulations on greenhouse gas emissions.”

In addition, the vessels will be equipped with Type B LNG fuel tanks with a design pressure of 1.0 bar to enhance the safety and efficiency of LNG operations, together with a range of energy-saving technologies, including Wind Shields, Rudder Bulbs, Pre-Swirl Stators, and Shore Power Systems. Smart ship technologies and cybersecurity protection features will also be incorporated to enhance operational efficiency, safety, and reliability while effectively reducing fuel consumption and greenhouse gas emissions.

Deliveries under Yang Ming’s next-generation fleet optimization plan commenced earlier this year. By 2030, a total of 24 new vessels are expected to enter service. 

This includes 18 LNG dual-fuel vessels—comprising five 15,500 TEU, seven 16,000 TEU, and the six 13,000 TEU vessels under this contract—alongside six 8,000 TEU methanol dual-fuel-ready ships. 

 

Photo credit: Yang Ming Marine Transport
Published: 4 September, 2026

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Alternative Fuels

LR, China’s MARIC unveil tanker concept ready for three future bunker fuels

Both secured AiP for a new 114,000 DWT product and crude oil tanker designed to accommodate future conversion to LNG, methanol or ammonia.
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LR, China’s MARIC unveil tanker concept ready for three future bunker fuels

Lloyd’s Register (LR) and the Marine Design and Research Institute of China (MARIC) on Thursday (3 September) have secured Approval in Principle (AiP) for a new 114,000 DWT product and crude oil tanker designed to accommodate future conversion to LNG, methanol or ammonia.

Announced at SMM 2026, the concept addresses one of the biggest investment challenges facing shipping today: the need to develop vessels and capabilities that can support a range of alternative fuel options and pathways as technologies, infrastructure and regulations evolve.

While LNG is already a mature fuel pathway, methanol and ammonia remain at an earlier stage of development, with questions around global fuel availability, infrastructure development, economics and long-term adoption.

The 114,000 DWT tanker concept has been designed as a product and crude oil carrier that can accommodate future conversion to LNG, methanol or ammonia as technologies, regulations and fuel supply chains mature. By incorporating conversion readiness at the design stage, the concept aims to reduce future retrofit complexity and provide owners with greater confidence when planning long-term fleet investments.

The design concept was reviewed against LR’s July 2026 class rules and regulations, including requirements relating to ships using gases and other low-flashpoint fuels, alongside relevant IACS Common Structural Rules for oil tankers. Final classification and statutory approval remain subject to full compliance with all applicable rules and regulations.

Theo Kourmpelis, Global Business Director for Tankers, Lloyd’s Register, said: “Shipowners are being asked to make major investment decisions today despite continued uncertainty around which fuels will dominate in the decades ahead. Alternative fuel solutions each offer potential pathways to compliance, but fuel infrastructure, regulation and economics continue to evolve at different speeds around the world.

“Designs that preserve flexibility will be critical in helping owners manage risk while preparing for multiple future scenarios.”

Si Nan, Marine & Offshore Marketing Department Vice Director, MARIC, said: “As the industry explores different decarbonisation pathways, shipowners need vessel designs that can adapt alongside technological and regulatory developments. This concept was developed specifically to provide greater fuel flexibility and long-term resilience, allowing owners to respond to changing market requirements without being locked into a single fuel strategy.

“Receiving Approval in Principle from Lloyd’s Register is an important milestone that validates the design concept and supports its future development.”

 

Photo credit: Lloyd’s Register
Published: 4 September, 2026

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Alternative Fuels

DNV: Alternative-fuelled vessel orders hit highest monthly level since October 2024

LNG-fuelled vessels accounted for the vast majority of August activity while the strong summer performance marked a significant acceleration in ordering activity after a relatively slow start to the year.
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DNV: Alternative-fuelled vessel orders hit highest monthly level since October 2024

Latest data from classification society DNV’s Alternative Fuels Insight (AFI) platform alternative-fuelled vessel ordering was strong in August, with 52 new vessels added to the platform.

This is the highest monthly total since October 2024 and follows another active month in July, when 47 vessels were added to the database.

LNG-fuelled vessels accounted for the vast majority of August activity, with 46 orders recorded. The container segment led the way with 30 orders, while the car carrier segment contributed a further 12 LNG-fuelled vessels. In addition, four ethanol-fuelled bulk carriers and two hydrogen-powered bulk carriers were added during the month, as well as one LNG bunker vessel.

The strong summer performance marked a significant acceleration in ordering activity after a relatively slow start to the year. In total, 242 alternative-fuelled vessel orders have been placed in the first eight months of 2026, representing a 27% increase compared with the same period in 2025.

LNG remains the dominant fuel choice, accounting for 63% of all alternative-fuelled vessel orders registered so far this year. Container vessels represent the largest share of these LNG orders (59%), followed by car carriers (30%).

Jason Stefanatos, Global Decarbonization Director at DNV Maritime, said: “The past two months have been particularly strong for alternative-fuelled vessel ordering, with August recording the highest monthly total we’ve seen since October 2024. This has helped lift year-to-date orders to a level well above the same period last year.

“LNG remains the leading fuel choice, driven largely by activity in the container and car carrier segments. These sectors have been among the earliest adopters of alternative fuels, supported by predictable liner operations and increasing demand from cargo owners to reduce emissions across supply chains. 

“For many owners, LNG offers a combination of emissions reductions, fuel availability and future flexibility while the longer-term fuel landscape continues to evolve. 

“At the same time, the latest figures include orders for ethanol- and hydrogen-fuelled vessels, highlighting that owners continue to explore a range of decarbonization pathways. Different segments are making different fuel choices, but the overall level of activity demonstrates continued investment in lower-emission shipping.”

Screenshot 2026 09 04 at 12.29.26 PM Screenshot 2026 09 04 at 12.29.36 PM

 

Photo credit: DNV
Published: 4 September, 2026

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