On July 22, Ukraine, Turkey, and UN Secretary General Antonio Guterres signed the Initiative (Agreement) on the partial unblocking of Ukrainian ports. This is one of the most important steps for the partial recovery of the Ukrainian economy and supply chains.

The purpose of this Initiative is to facilitate safe navigation for the export of grain and related food products and fertilizers, including ammonia, from the ports of Odesa, Chornomorsk and Yuzhny, often referred to as the “ports of Big Odesa”.

The starting point for launching the “safe corridor” mechanism is the establishment of the Joint Coordination Center (JCC) in Istanbul. Merchant vessels will have to be pre-registered with the SCC and will be subject to inspection by an inspection team in ports designated by the Turkish side.

It is important to note that we are talking about a “maritime humanitarian corridor that will be controlled remotely by the Parties” – that is, the presence of no warships is allowed. Likewise, this applies to demining, which will not be carried out, except in those cases where it is necessary for the passage of ships through the corridor.

This Agreement will remain valid for 120 days with further extension.

From an economic point of view, such Agreement will allow Ukraine to export approximately 20 million tons of grain and oil crops that are waiting to be shipped, free up space for storing the new harvest and attract foreign currency income. For comparison, in June it was possible to export only about 1/3 of the planned grain. At the same time, the humanitarian aspect will involve the arrival of necessary food to Africa, Asia and Europe.

The next point to consider (especially for Shipowners) is the insurance policy and additional war risks, because even before signing the Agreement, the Insurers unanimously stated that they need additional guarantees in connection with potential losses that may occur. Therefore, it is now expected that the underwriters will work out the signed Agreement in detail. Today, insurance premiums are quite high, but the demand for ship calls to Ukrainian ports can overcome this factor as well.

Shipowners, whose ships have been “stuck” in Ukraine since February 24, are primarily interested in unblocking Ukrainian ports, and these are about 80 merchant ships, which will be the first to pass through the “maritime humanitarian corridor”. Other shipowners will carefully consider all the risks of entering Ukrainian ports, including the Turkish fleet, which is more determined. The decision to charter a vessel for voyages to Ukrainian ports will be influenced by the freight rate, payment of insurance premiums for war risks and potential military threats in the Black Sea.

Finally, the unblocking of Ukrainian ports, even if it is only partial, foresees both fundamentally positive changes for the state’s economy and carries potential risks, given the “good faith” of russia’s fulfillment of its obligations under the Agreement.

The Ukrainian shipping community did not even have time to analyze all the pros and cons of such an unblocking scenario, as on July 23, Russia attacked the territory of the port of Odessa with a missile strike, then launched missile strikes on the Odesa region. Despite this, the ports are actively preparing for the first caravans from the ports indicated above, all other market participants are waiting for the results of the passages and the further development of this situation.

Authors:

Evgeniy Sukachev
Senior partner Black Sea Law Company

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CHARITY FOR UKRAINE

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Evgeniy Sukachev, Senior Partner BLACK SEA LAW COMPANY, had an opportunity to have been asked by Trade Winds to comment on the Russian Federation’s attacks on Ukraine and documenting shipping crimes for further use of evidence at the tribunal.

Documenting war crimes against ships and seafarers

Attacks on civilian seafarers and ships are war crimes, and in Odessa, maritime lawyers are preparing for their day in court. The job of a maritime lawyer at a busy port is not supposed to include the prosecution of war crimes. But, at the time of writing in besieged Odessa, Evgeniy Sukachev, senior partner of one of the country’s biggest maritime law firms, is documenting military crimes against civilian shipping, and preserving the evidence for use in the tribunal that he believes will inevitably be convened to prosecute them. “There are about a hundred vessels under foreign flag trapped in Odessa by the blockade by ships of the Russian Federation. Five trading vessels have been attacked, one of them sank and one is still burning in our waters,” Sukachev said in a recent telephone conversation. “All these incidents — attacks on peaceful civilians, on ships not under Ukraine flag — are war crimes,” said Sukachev. Air-raid sirens sounded in the background.

TradeWinds has previously reported on the death and injury of merchant seafarers in attacks, and reports of the use of one general cargo ship as a seagoing “human shield”. When civilians are deliberately attacked in this way, the battlefield becomes a crime scene, one in which preserving evidence is a challenge.

“We hope and we are sure that in the nearest time, a tribunal will be convened to hold proceedings against the people who have done this, from the top leader down to the individual pilot,” he said. Odessa lives under the threat of aerial bombardment and is under siege from the sea, with no substantial Ukraine fleet to defend it against the Russian ships now in Odessa Bay. Three attempted amphibious landings aimed at Odessa have failed, he said, and on the night of 7 March, Ukrainian shore rocket batteries destroyed one of the blockade ships, the 94-metre, 80-man Vasiliy Bykov (commissioned 2018).

Despite these circumstances, Sukachev said his Black Sea Law Co is continuing to provide services to his mostly foreign clients, although much legal business is on hold and all lawyers are working from a separate secure location. But his big task now is documenting attacks on civilians at sea, both as part of his job and as part of the war effort. “Any piece of information is important. Video, phone records, official documents, and information from the port authorities and seafarers — we collect everything in a box as a case file. It will be very important to collect all the evidence, not just for a war-crimes tribunal but also arbitrations and actions for damages,” he said. “These cases will not be against insurance companies, but against the Russian Federation, and that is important.”
Like other firms in the Ukraine Maritime Bar Association, his legal team also digitalise the information and upload it to the cloud for preservation in case their offices are destroyed in an attack.

In the eight years since the conflict in which Russia took substantially all Ukraine’s naval fleet along with the Crimean peninsula, many private citizens have been assembling their own personal arsenals, and like other Ukrainian men of up to 60 years, Sukachev could be called up for military service. “I have ammunition myself since 2014,” he said. “I am sleeping with it.”

Planned for years

Odessa is one of the most multinational parts of Ukraine, with a large ethnic Russian component in the mix, and some have been inclined to see Russia’s side in previous disputes. One Odessa shipowner with a foreign reputation, Viktor Baranskiy, has even been active as a politician in a generally pro-Russian political party. But Sukachev said that divisions within shipping and in the larger society have disappeared now. “Nowadays even the people who had thoughts that Russia could be right have changed because we see that this invasion has been planned for years,” he said. He has limited sympathy for belated expressions of support from businesses within Russia, including those in shipping. “We don’t need their words of apology now. They should have done that before and changed the regime in Russia,” he said. “For their silence, Ukraine is paying a great price.”

Sukachev added a reckoning is also coming for Ukrainian shipping businesses with very close connections to the Russian state. “All such relationships will be under detailed review in the nearest future,” he said.

Read the full text of the article “Odessa lawyers go beyond the call of duty to build war crimes case” in the March 11, 2022 edition.

By Bob Rust

BLACK SEA LAW COMPANY has acted as a legal advisor on sanction-related issues against foreign Shipowner. The vessel successfully completed cargo operations and departed from Ukraine without any detention. Sanctions are one of the factors that affect the relationship between Parties of maritime business. Therefore, comprehensive due diligence and tested compliance program is the best – and only – way to mitigate sanctions risks.

The 10th Edition “Insurance & Reinsurance 2021” has already been published. It covers common issues in insurance and reinsurance legislation regulations in 34 jurisdictions, including regulatory authorities and procedures, (re)insurance claims, litigation procedure and arbitration.

Key practical issues of insurance and reinsurance in Ukraine were prepared by BLACK SEA LAW COMPANY in the International Comparative Legal Guide: Insurance & Reinsurance 2021, published by Global Legal Group.

Our team of lawyers has been working with key representatives of the global maritime insurance market for many years and has an exceptional understanding of the insurance industry, especially P&I and H&M insurance.

To view or download the 10th Edition “Insurance & Reinsurance 2021”, Chapter 36 Ukrainian jurisdiction, please click below:

Authors:

Evgeniy Sukachev
Senior partner

   

Anastasiya Sukacheva
Partner

BLACK SEA LAW COMPANY, representing the interests of the Shipowner and P&I Club, provided legal support to the settlement of seafarers’ claim dispute through mediation. We always adhere to the position of negotiating and resolving any disputes amicably, achieving the best result for our Clients.

Our Team regularly advised shipping companies and insurance companies about Ukrainian seafarers` claims adjustment, providing recommendations based on knowledge of civil law and inheritance law. We have quite experience in medical law in connection to injury claims and death claims resolution in Ukrainian jurisdiction.

Our lawyers and insurance consultants have experience in the following categories of claims:
– Personal injury to or illness or loss of life of crew members
– Personal injury to or loss of life of stevedores
– Personal injury to or illness or loss of life of passengers and others
– Life salvage
– Consultation in disputes between P&I clubs and Seafarers
– Legal support for crew members employment
– Settlement of death compensation payment
– Conducting due diligence on unsubstantiated claims of seafarers
– Release of ships from arrest on claims of seafarers

Our Team successfully arrested the vessel and received security for the maritime claim related to Charter party dispute. This is one of the examples of the classic arrest of a ship procedure in the Ukrainian jurisdiction.

The arrest of a vessel always encourages the Shipowner to take measures to satisfy maritime claims to avoid additional financial losses. The Ukrainian jurisdiction is not an exception, and the arrest of the ship is one of the most powerful method for reimbursement of bunker supply, ship repair and charterparty disputes, as well on contracts of carriage, disputes on ownership of the ship, insurance compensation and claims of the government authorities.

Our Shipping Practice Team constantly monitors and analyzes the practice of ship arrest in Ukrainian ports and beyond. Please find below the full analytical review on the arrest of vessels in Ukrainian jurisdiction for 2018-2020.

BLACK SEA LAW COMPANY has successfully defended the interests of a foreign Shipowner and the P&I Club in a dispute with Ukrainian port authorities.

The case is related to the ship berthing incident, which caused legal consequences for all parties. Such incidents are common in the shipping industry, but it is important to always reduce the risk of any claims from both contractors and port authorities against Shipowner or vessel.

The causes of incidents in the port may be the negligence of any of the parties involved in cargo operations in the port, including towing and pilotage. In addition, incidents caused by the human factor are quite common, and therefore such cases require careful research and analysis.

Another successful case for the Shipping and Maritime Insurance Team, which was handled by Evgeniy Sukachev & Anastasiia Sukacheva.

Evgeniy Sukachev, Senior Partner of the BLACK SEA LAW COMPANY, gave a lecture on “International Commercial Arbitration” as part of a training course from PLASKE Academy, according to the standards of the FIATA International Federation of Freight Forwarders Associations.

The lecture focused on key aspects of international commercial arbitration in the maritime industry, including arbitration in England and Wales, LMAA London, GAFTA and FOSFA. In addition, the lecture included specific issues regarding the procedure for recognition and enforcement of arbitral awards and the main provisions of the 1958 New York Convention.

It was a pleasure to cooperate with PLASKE Academy and contribute to the training of qualified specialists in transport logistics and international freight forwarding.

On September 17, the Black Sea Law Company joined the signing of the Gulf of Guinea Declaration on the Suppression of Piracy.

The problem of piracy in the Gulf of Guinea has been growing over the last decade. Cases of piracy and violence continue to be the focus of the maritime industry in 2021. More than 200 nautical miles from pirate bases, mostly located in the Niger Delta, are the largest number of attacks on seafarers.

In a report published 9 June 2021, the United Nations Office on Drugs & Crime (UNODC) provides an interesting view into the piracy problem (view report). The situation in the Gulf of Guinea is becoming more acute every year, and this report provides analytical information on all cases of piracy, including the increase in territory and number. Despite efforts by coastal countries, including Nigeria, as well as by external actors, the Gulf of Guinea remains one of the most dangerous maritime areas in the world, with acts of piracy now extending from the Ivory Coast to Congo-Brazzaville. Twenty-five successful piracy attacks resulted in 142 kidnapped seafarers in 2020.

BIMCO is the world’s largest international shipping association, with around 1,900 members in more than 120 countries (59% of the world’s tonnage) encourages the shipping industry to cooperate to suppress piracy. In response to growing concerns and increasing attacks in the region, a task force of stakeholders from across the shipping industry drafted the Gulf of Guinea Declaration on the Suppression of Piracy.

More than 400 signatories, including flag state administrations, ship owners, charterers, and shipping associations, supported the piracy problem in the Gulf of Guinea. The List of signatories of the Gulf of Guinea Declaration is on the BIMCO website.

We are pleased to join the Declaration, and we are grateful to BIMCO and the Shipping Industry for their support. Our Company is always in a position to provide any possible legal assistance in protecting Seafarers, Shipowners, and Charterers from any possible risks of being subjected to pirate attacks.

We hope that the cooperation of associations, companies, and international organizations, as well as joint efforts, will be useful in achieving the goals and ensuring safety in the Gulf of Guinea.

The List of signatories of the Gulf of Guinea Declaration on the BIMCO website:

We recognise the important steps taken and positive initiatives underway by coastal States in the region. We call on all stakeholders eg coastal and flag States, shipowners, charterers, maritime organizations, importers and exporters, oil, and mining companies, offshore operators, fishers, supranational organizations, labour unions, and NGOs, to sign this pledge and join together in a coalition to end the threat of piracy in the Gulf of Guinea through:

– Tangibly supporting antipiracy law enforcement (as mandated by international law including international treaties, eg the United Nations Convention on the Law of the Sea) by non-regional naval forces providing a capable incident response capability to complement regional coastal States’ antipiracy law enforcement operations;
– Enhancing regional capacity building with priority given to those coastal States which demonstrate the will to participate actively in law enforcement at sea;
– Encouraging non-regional navies to work actively together with each other and the Gulf of Guinea coastal States’ antipiracy law enforcement forces and agencies to suppress the pirate threat;
– Supporting the deployment of law enforcement staff from regional coastal States on non-regional navy ships for capacity building purposes and to assist in the arrest and prosecution of pirates;
– Facilitating the implementation of effective shipboard defensive measures within the region, including via the BMP West Africa guidance and through other onboard active and passive protective measures;
– Improving domain awareness (eg via radars on offshore platforms) and sharing of relevant information between antipiracy law enforcement forces and agencies;
– Increasing effective law enforcement activity ashore to disrupt the underlying criminal enterprises where they are based;
– Providing prison facilities for arrested pirates (ideally in the region), and encouraging coastal States in the Gulf of Guinea to actively prosecute;
– Working towards improving the transparency between law enforcement agencies, military forces, and protection services; and
– Actively conveying the messages above to relevant stakeholders.

We firmly believe that piracy and attempts at kidnapping are preventable; as a minimum, we need to see, by the end of 2023, that:

– The number of attacks by pirates should be reduced from current levels by at least 80%; and
– No seafarers should have been kidnapped from a ship in the preceding 12-month period.