NITL: Shippers should use new model contract as ‘starting point’

Lawyers still need to be consulted, but the model has valuable input from expert shippers, says NIT League.    A new standardized container shipping contract developed by the Global Shippers Forum and Baltic International Maritime Council Organization should be used as a “starting point for shippers,” says Bruce Carlton, president and chief executive officer of the National Industrial Transportation League. “No shipper should just download it from the GSF website, sign it and hand it over to their carrier,” Carlton said in a statement. 
   The NIT League is a member of the GSF and Carlton said Donald Pisano, president of American Coffee Corp. and chairman of the NIT League’s Ocean Transportation Committee played a “a very significant role in the development and negotiation of this model contract with BIMCO,” with his expertise as an ocean shipper “absolutely invaluable in producing a fair and balanced model contract.”
   Carlton added the NIT League, “In the strongest possible terms we would advise any shipper using this model to consult with experienced legal counsel before they do anything else. The model contract is comprehensive guidance, and the notes that we’ve prepared are meant to help shippers understand what the various clauses mean and their importance.”
   Both Carlton and Pisano said they think it likely the model is likely to be of greater value to small and medium-sized enterprises that may not have either the resources or bargaining strength of the very large scale shippers.
   “Will the model contract give them bargaining power? No. But it will highlight the terms and conditions that they need to address and agree on with their ocean carrier,” explained Carlton. “And it has the great value of having been written with input from expert shippers and expert carriers. But every shipper should make sure your own expert lawyer is weighing the pros and cons of every element in the contract.”
   “Too often we have heard that small and medium sized shippers are basically just taking the standard form terms and conditions in service contracts offered by carriers. Those contracts might be fine in some cases, but we remind shippers that they were written exclusively by and for carriers. We think this new GSF/BIMCO product reflects a more balanced starting point for the carrier-shipper negotiation.”
   Shippers can access the model contract and notes from the GSF website. GSF is providing it free of charge; there are no membership requirements. Shippers will be asked for some identifying information, as GSF wants to understand who is accessing the tool.