BIMCO publishes new model contract for sales and purchases of commercial vessels | Knowledge


The Baltic and International Maritime Council (BIMCO) has published BOAT SALE 22, a new standard contract form for use by commercial sellers and buyers of ships. SHIPSALE 22 is intended to replace the popular SALEFORM 2012 contract form.

The new SHIPSALE 22 form follows the content of SALEFORM 2012, but should be easier to use. SHIPSALE 22 adds the “box” format of most other BIMCO forms, which groups key transaction-specific entries into boxes on the front page; the sale clauses have been rearranged to appear in an order that more closely follows the way many ship sale transactions are conducted; and several clauses have been updated to reflect modern practices and issues (eg preconditions, international sanctions and electronic signatures).

Precautions and Considerations

Although SHIPSALE 22 does not deviate radically from the substance of SALEFORM 2012, there are a number of changes in details, rights and obligations, and timelines which should be carefully considered. A specific point to clarify relates to the changes to applicable law and dispute resolution.

The sample form displayed from SHIPSALE 22 appears to significantly change the format for selecting governing law and dispute resolution forum.

The old SALEFORM 2012 allowed parties to select one of three clauses and cross out the two unused clauses, the first option being the choice of English law, the Arbitration Act 1996 and London Maritime Arbitration Arbitrators Association (LMAA) in London; the second option being New York law and arbitration in New York under the Society of Maritime Arbitrators (SMA); and the third option being a general choice of law clause without an arbitration clause. Of course, the parties could also modify these clauses, or substitute different agreed-upon language or select a designated court in place of arbitration.

In SHIPSALE 22, the wording of Box 26, Part I states: “26. Law and Arbitration (choose law and place of arbitration. If alternative (g) (Other) is chosen, clause 26 must duly completed or superseded, failing which alternative (a) (English law/London arbitration) applies).” Clause 26, Part II, however, only gives the first option of English law and LMAA arbitration in London. And there is no “alternative (g)” in Clause 26. The wording of Box 26, Part I, or the wording of Clause 26, Part II, may be later clarified or revised, and/ or BIMCO’s intention may be that designating a choice in Box 26 would generate alternative language in clause 26 based on one of the versions of the “BIMCO Law and Arbitration Clause 2020” that BIMCO has developed for four venues – London, New York, Singapore and Hong Kong.

Ultimately, the form should facilitate the choice of applicable law and dispute resolution provisions that are appropriate for the parties and the circumstances of the vessel and transaction at issue. Certainly, forecasting New York is an option of the earlier form that should be retained. It may be useful to provide optional model clauses for arbitration in other leading jurisdictions, such as Singapore, and a model choice of law clause such as option “c” in SALEFORM 2012 for parties who choose not to arbitrate, in addition to the “provide your own option.

The information in this alert is intended for the general education and knowledge of our readers. It is not intended to be and should not be relied upon as the sole source of information when analyzing and resolving a legal issue, and it should not substitute for legal advice, which is based on a specific factual analysis. In addition, the laws of each jurisdiction are different and constantly changing. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. If you have specific questions regarding a particular factual situation, you are encouraged to consult the authors of this publication, your Holland & Knight representative or other competent legal counsel.

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