Chapter VII
CHARTERPARTIES
Section 1. GENERAL PROVISIONS
Article 138.-Charterparties
A charterparty is a contract concluded between a shipowner and a charterer, whereby the shipowner transfers the right to use his/her seagoing vessel to the charterer for a specified period of time and for a specified purpose agreed upon in the contract for remuneration paid by the charterer.
Article 139.- Forms of charterparties
1. A charterparty is concluded in the form of time charterparty or bareboat charterparty
2. A charterparty must be made in writing
Article 140.-Subletting of vessels
1. The charterer may sublet the vessel to a third party if there is such agreement in the contract but shall still be obliged to perform the contract concluded with the shipowner.
2. The rights and obligations of the shipowner provided for in this Chapter shall also apply to the charterer who sublets the vessel to a third party.
Article 141.- Principles for application of laws to charterparties
The provisions pertaining to the rights and obligations of the shipowner and the charter in this Chapter shall apply only when the shipowner and the charterer do not otherwise agree.
Article 142.-Statute of limitations for initiation of lawsuits regarding charterparties
The statute of limitations for initiation of lawsuits regarding the charterparty is two years from the date of termination of the charterparty.
Section 2. TIME CHARTER
Article 143.-Time charterparties
1. A time charterparty is a charterparty whereby a shipowner supplies a specific vessel together with its crew to a charterer.
2. A time charterparty contains the following details:
a. The name of the shipowner, the name of the charterer;
b. The name, nationality, class, tonnage engine capacity, capacity, speed and fuel consumption level of the vessel;
c. The operation area of the vessel, use purpose and term of the charterparty;
d. The time, place of and conditions on the delivery and return of the vessel;
e. The charter hire, mode of payment;
f. Other related contents.
Article 144.-Obligations of shipowners under time charter
1. The shiponwer shall be obliged to deliver to the charterer at the right agreed place and on the right agreed time the seagoing vessel in technically safe conditions, properly supplied and adapted for the purpose of employment agreed upon in the contract and maintain such throughout the currency of the charterparty.
2. The shiponwer shall be obliged to supply a complement of crew qualified for the purpose of employment of the vessel agreed upon in the contract and to pay the wages and secure the other legitimate interests of crewmen throughout the currency of the charterparty.
Article 145.- Rights of charterers under time charter
1. The charterer shall be entitled to dispose of the entire space in the vessel appropriated for the carriage of cargo, passengers and luggage.
2. The charterer must not dispose of the other space on board the vessel for the carriage of cargo, passengers and luggage, unless it is consented by the shipowner.
Article 146.-Obligations of charteres under time charter
1. The charterer shall be obliged to employ the vessel for the purposes as agreed upon in the contract and to take due care of the shiponwer’s interests.
2. The charterer shall be obliged to ensure that the vessel be employed only for the lawful carriage of cargo, passengers and luggage.
3. When the period for time charter terminates, the charterer shall be obligeid to redeliver the vessel to the shiponwer at the place and time and in technical conditions as agreed upon, except for the vessel’s natural wear.
Article 147.- Relations between shipowners, charterers and crew of vessels in time charter
1. During the term of a time charterparty, the master and other crewmen shall remain under the shipowner’s labor management. The shipowner shall be completely liable for all matters pertaining to crew.
2. In the operation of the vessel, the master shall be the representative of the charter and must comply with the instructions given by the charterer in accordance with the time charterparty.
3. For the acts of the master performed within his/her powers stated in Clause 2 of this Article, the shipowner shall be liable jointly with the charterer, unless the master has clearly stated his/her commitment that he/she exercises such powers in the name of the charterer.
Article 148.-Division of salvage remuneration under time charter
If during the term of a time charterparty the vessel involves in salvage operations, the remuneration shall be deivided equally between the shipowner and the charterer after deducting the sume covering expenses arising from salvage operations and the share of salvage remuneration due to the crew.
Article 149.- Beyond the term of time charter
If, according to reasonable calculations, the vessel shall complete the last voyage beyond the time for redelivery determined in the charterparty, the charterer may continue to employ the vessel till completion of such voyage; the charterer shall have to pay a hire for such excessive time at the rate determined in the charterparty; if the hire rate on the market is higher than that determined in the charterparty, the charterer shall have to pay the hire at the market price at the time of payment.
Article 150.- Payment of hire under time charter
1. The charterer shall have to pay the hire for the period from the date of receipt of the vessel to the date of its redelivery to the shipowner.
2. The charterer shall not have to pay to the shipowner the hire for any period during which the vessel is unfit for operation on account of technical breakdown, lack of supplies, or incompetent crew. In this case, the charterer shall be relieved of the obligation to pay the costs of the vessel’s maintenance.
3. Where the vessel’s unfitness for operation is due to the fault of the charterer, the shipowner shall still be entitled to the hire and to the compensation for the damage arising therefrom.
4. Where the chartered vessel is missing, the hire shall be calculated until the date when the last information on the vessel is received.
5. Where the charterer fails to pay the hire as agreed upon in the charterparty, the shipowner shall have the right to retain the cargo and property on board the vessel, provided that such cargo and property are under the ownership of the charterer.
Article 151.-Termination of time charterparties
1. Where the failure to perform the obligations specified in Article 144 of this Code is due to the fault of the shipowner, the charterer shall be entitled to terminate the contract and claim for compensation for the damage arising therefrom.
2. Either party may terminate the time charterparty without having to pay compensation to the other if the performance of the contract has been hindered by an outbreak of war, a riot or coercive measures taken by a competent state agency and such event is unable to come to an end within a reasonable time.
3. A charterparty shall automatically terminate when the vessel has been lost, sunk, destroyed or has been so damaged that its repair is impossible or uneconomical.
Section 3. BAREBOAT CHARTER
Article 152.- Bareboat charterparties
1. A bareboat charterparty is a charterparty whereby a shipowner supplies a specific vessel together without crew to a charterer.
2. A time charterparty contains the following details:
a. The name of the shipowner, the name of the charterer;
b. The name, nationality, class, tonnage and engine capacity of the vessel;
c. The operation area of the vessel, employment purpose and term of the charterparty;
d. The time, place of and conditions on the delivery and redelivery of the vessel;
e. Inspection, maintenance and repair of the vessel;
f. The charter hire, mode of payment;
g. Insurance of the vessel;
h. Time and conditions for termination of the charterparty;
i. Other related contents.
Article 153.- Obligations of shipowners under bareboat charter
1. The shipowner must perform with due diligence his/her obligations to deliver a seaworthy vessel together with its documents to the bareboat charterer at the place and time agreed upon in the charterparty.
2. During the term of a charterparty, without the charterer’s written consent, the shipowner shall not be allowed to mortgage the vessel; where the shipowner acts against this provision, he/she must compensate for the damage caused to the charterer.
3. Where the vessel is arrested on account of disputes over the ownership of the vessel or the shipowner’s debts, the shipowner must secure that the interests of the charterer not be affected and must compensate for the damage caused to the charterer.
Article 154.- Obligations of charterers under bareboat charter
1. The charterer shall be obliged to carry out the maintenance of the vessel and equipment on board during the currency of the bareboat charter.
2. The charterer shall be obliged to repair breakdowns of the vessel and to keep the shipowner informed thereof. The shipowner shall have to refund the repair costs occurred beyond the scope of the charterer’s liability.
3. During the currency of the bareboat charter, the charterer shall bear the costs of insurance for the vessel with the value and mode as agreed upon in the charterparty.
4. During the currency of the bareboat charter, if the employment and operation of the vessel by the charterer causes damage to the shipowner, he/she shall be obliged to remedy or compensate for such damage.
Article 155.- Obligation to redeliver vessels, employment of vessels beyond the term of the charter, and termination of bareboat charterparties.
The obligation to redeliver vessels, employment of vessels beyond the term of the charter, and termination of bareboat charterparties shall comply with the provisions of Clause 3 of Article 146, Article 149 and Article 151 of this Code.
Article 156.- Payment of hires under bareboat charter
The bareboat charterer shall have to pay the hire as agreed upon in the charterparty. Where the vessel suffers from total loss or is missing, the payment of the hire shall terminate from the time the vessel suffers from total loss or the date of receipt of the last information on the vessel. Part of the hire paid in advance must be refunded corresponding to the time the vessel is not employed.
Article 157.- Hire-purchase of vessels
Where there is a term on the hire-purchase of the vessel in the bareboat charterparty, the ownership of the vessel under the bareboat charterparty shall be transferred to the charterer as agreed upon in the contract.
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