Ship Management Contracts

SPECIAL ORDER ITEM - 1 WEEK DELAY

In the 1980s shipping went through one of the biggest structural changes the industry has ever seen which was the development of third party ship management services. A weak freight market forced many shipowners to explore new avenues to reduce their operational costs and one such avenue was the outsourcing of commercial and technical ship management to companies financially independent from the ship owning company and structured to carry out that kind of services as agents for and on behalf of owners; the so-called third party ship managers.

While the ship management industry evolved with an increasing part of the world fleet being placed under third-party ship management there was no standard management agreement that it could rely on as a basis for individual contract negotiations. This prompted a number of shipowners and ship managers to approach BIMCO in the mid 80s asking BIMCO to take the lead in the development of a standard ship management agreement striking a fair balance between the owners’ and managers’ rights and obligations.