The Off-Hire Clause

In the world of maritime law, the off-hire clause remains one of the most widely discussed and sometimes controversial laws. And although many shippers usually are unaware of the law, it would be helpful for them to gain a better understanding of the law and the impact of the law on the world of shipping ocean containers. Basically, the off-hire clause gives the charterer of the ocean vessel a reason to not have to pay hire during certain times when the vessel is out of service. An example of that time include when the vessel is on fire, receives massive damage, is dry docked, in repair or other times when the ship is compromised from transportation.

Traditionally, there has been much debate about including piracy as an event that can fall under the off-hire clause. Technically it is not, but some charterers would like to see that it should be included given the rise of piracy in recent years. This is of course a legal matter in the container shipping industry. All of the details of the off-hire clause are usually written in a lengthy contract. The off-hire clause itself originated years ago in the NYPE (New York Produce Exchange Time Charter).

The off-hire clause continues to be a major topic of debate in the international shipping community. While the law could be altered in the future, the impact in the current industry remains. The off-hire clause is always a heated topic in the world of shipping news, especially among ship owners.