Merchant Shipping Code of Ukraine (Edition of July 04, 2013)

SECTION VI. Chartering of Vessels.

Chapter 1. Charter Party.

Clause 203. Definition of Charter Party (Carter Party).

In accordance with a Charter Party the Shipowner shall undertake to place the vessel at the disposal of the Charterer for a definite period of time for carrying cargo, passengers or for any other purposes of merchant shipping in exchange for stipulated payment (freight).

The vessel placed at the disposal of the Charterer may be manned with a crew (time-charter) or may not be dully outfitted for voyage and not manned with a crew (bare-boat charter).

Clause 204. Proofs of Conclusion of Contract.

A Charter Party shall be concluded in writing. The existence and context of the Charter Party may be proven by written evidence only.

Clause 205. Particulars of Charter Party.

Determined in a Charter Party shall be the names of the parties to the Charter Party, the name of vessel, her technical and operational particulars (tonnage, cargo capacity, speed, etc.), sailing range and/or area, objective of chartering, amount of freight, the term of contract validity and the place of delivery and redelivery of the vessel.

Clause 206. Sublease.

The Charterer may, within the rights granted him in compliance with the Charter Party, conclude, on his own behalf an independent Charter Party with a third party. Conclusion of said Charter Party shall not relieve the Charterer from fulfilling the Charter Party concluded with the Shipowner.

The Charter Party concluded with a third party shall be governed by the rules of this Chapter as applicable.

Clause 207. Seaworthiness of Vessel.

The Shipowner shall undertake to deliver the vessel to the Charterer in a condition fit for using her for the purposes stipulated by the Charter Party.

When chartering the vessel on a time-charter basis, the Shipowner shall also undertake to duly outfit and man the vessel with a crew as well as maintain the vessel seaworthy during time-charter period and pay for her insurance and the crew.

Clause 208. Restrictions on Using Vessel.

The Charterer shall undertake to operate the vessel in accordance with the terms of chartering stipulated by Charter Party.

Clause 209. Charterer's Right to Conclude Contracts of Carriage.

If the vessel has been chartered for cargo carriage, the Charterer shall have the right to conclude, on his own behalf, contracts of carriage of cargoes, sign charter-parties, issue Bills of Lading and other transport documents. He shall be liable for obligations arising out of said documents in particular, from the Bill of Lading or other transport documents.

Clause 210. Subordination of Vessel's Crew to Charterer.

In case the vessel is chartered on a time-charter basis, the Master and other members of the crew shall be subordinated to the Charterer's orders concerning the vessel's operation excluding those concerning navigation, shipboard routine and crew complement.

Clause 211. Liability of Charterer.

The Charterer shall be liable for losses caused by salvage, damage to or loss of the vessel if said losses resulted from his fault.

Clause 212. Payment of Freight.

The Charterer shall pay the freight to the Shipowner in terms and following a procedure determined by the Charter Party. He shall be exempt from paying the freight and compensating for expenses of the vessel during the period when the vessel has been unfit for operation because of unseaworthiness, excluding the instances when said condition of the vessel has been caused by the Charterer's fault.

Clause 213. Payment of Freight in Case Vessel is Lost.

If the vessel is lost, the freight shall be paid to the day of said loss and if said day cannot be established - to the day the vessel has been last heard of.

Clause 214. Award for Salvage at Sea.

An award due to the time-chartered vessel for salvage at sea that has taken place prior to termination of the time charter shall be distributed in equal shares between the Shipowner and the Charterer, less the sums due as reimbursement of losses incurred by the vessel and the share due to her crew. An award due to the vessel chartered without a crew for salvage at sea that has taken place during the period of said Charter Party's validity, shall belong to the Charterer.