Insights

The US Government’s sanctions against Venezuela and, specifically, PdVSA, have been a significant focus of discussion since their implementation earlier this year. In this article, we provide an update on the situation and some clarity in relation to the application of the sanctions and how they may impact Members.

The case provides clarification that a charterer’s obligation to keep a ship in class under a Barecon charter is an absolute obligation and a condition of the contract. It also provides a warning of the importance of maintaining class under a bareboat charter at all times and the potentially drastic consequences of failing to do so.

During April and May 2019, OFAC has added a number of non US ships and owners to the SDN list, reinforcing the extra-territoriality of EO 13806. 

Read OFAC’s sanctions FAQ’s here.

Members are advised to incorporate sanctions clauses into their charterparties, such as the BIMCO Sanctions Clause for Time Charters and the BIMCO Designated Entities Clause for Time Charters.