Ercüment Erdem Att. Duygu Oner

2016 York Antwerp Rules

March 2019

Introduction

The Communiqué on the 2016 York Antwerp Rules was entered into force through publication in the Official Gazette dated 19 February 2019 and numbered 30691. The York Antwerp Rules set out the principles of the “general average” for the equitable allocation of sacrifices made in case of a sudden threat in maritime travel. The general average is defined as sharing the damages and costs that are the result of loss suffered in order to save a ship and her cargo from danger in the event of abnormal danger faced by the ship and cargo in the course of maritime travel.

The general average is firstly regulated by national laws. The fact that the parties related to transportation in maritime transports (persons related to the cargo and ship) generally have different nationalities, and the differences between national laws has revealed the need to create a uniform body of rules as to general averages. As a result of the works initiated by the International Law Association towards the end of the 19th century, the rules that define the principles and scope of general averages is called the York Antwerp Rules. The York Antwerp Rules are renewed periodically by the International Maritime Committee (“IMC”) according to the requirements of international trade and current issues. As a result of the changes made in 2016, the Rules became the most recent version, as recommended.

The York Antwerp Rules do not have the characteristics of an international contract; they are similar to advisory rules that may be added as a term in the freight contract or bill of lading pursuant to the will of parties concerning maritime transport. In practice, the parties usually implement the York Antwerp Rules by specifying the date (2014, 2016) instead of codes for the contract and bill of lading[1].

Implementation of York Antwerp Rules

The provisions concerning general averages in Turkish Law are regulated between Articles 1272 and 1285 of the Turkish Commercial Code (“TCC”). Pursuant to Article 1273 of the TCC, “In the event that parties agree otherwise, general average pro rata is subject to the rule of the last version of the York Antwerp Rules prepared by International Marine Committee and translated into Turkish and published in accordance with this Article.”

In this respect, the legislator adopts the freedom of contract to decide which rules to be applied to general averages, and leaves the rules to be applied to the will of the parties. Therefore, the parties may decide which text of the York Antwerp Rules will be applied (1996, 2004, etc.) as they see fit. However, in cases where the parties do not make any agreement regarding this issue, and Turkish Law is applied, Article 1273 of the TCC shall govern. In accordance with the relevant regulation, in the case of general averages, unless the parties agree otherwise, the most recent York Antwerp Rules, as published in the Official Gazette, shall apply.

The legislator refrained from codifying the Rules, taking into consideration that the York Antwerp Rules have been renewed, periodically. Thus, the most recent Rules, which are accepted by the IMC regarding general averages, and entered into force through publication in the Official Gazette, shall be applied without any necessity to change the TCC.

General Averages Pursuant to York Antwerp Rules

The conditions in which the general average emerges; in other words, the types of general averages, are regulated in the numbered rules of the York Antwerp Rules (Rule I - XXIII). The lettered rules indicated between A - G regulate the general principles of general averages. Unless an exception is provided for, the general principles set out in the lettered rule shall also apply to numbered rules.[2]

The Rule of Interpretation and Rule of Paramount have been set forth in the preamble of the York Antwerp Rules. In accordance with the Rule of Interpretation, in the adjustment of general averages, the lettered and numbered Rules shall be applied irrespective of any law or practice inconsistent therewith. Except as provided by the Rule Paramount and the numbered Rules, general averages shall be adjusted according to the lettered Rules. In this respect, when the parties decide on the implementation of the York Antwerp Rules, it is accepted that these rules shall supersede national laws.

As per the Rule Paramount, in no case shall there be any allowance for sacrifice or expenditure unless reasonably made or incurred.

Conditions of General Average

There is a general average act when; (i) a ship is partially or fully loaded; (ii) the ship and the cargo have encountered a common peril; (iii) any extraordinary sacrifice or expenditure is made for the purpose of preservation from the peril; (iv) the sacrifice is reasonable and made voluntarily, and (v) the sacrifice results in a beneficial outcome; in other words, the ship or the cargo result in being partially or completely preserved[3]. The sharing of expenditures in the general average system is made between the parties who benefit from the rescue of the ship and the cargo.

Major General Average Types

  • Jettison of Cargo

The cases of jettisoned cargo in order to eliminate a common peril shall be allowed as a general average. Loss of or damage to the property by water which enters a ship’s hatches that have been opened, or other opening has been made for the purpose of making a jettison for common safety, shall be allowed as a general average. On the other hand, no jettison of cargo shall be allowed as a general average, unless such cargo is carried in accordance with the recognized custom of the trade.

  • Extinguishing Fire

Damage by fire constitutes a particular average and it is not allocated[4]. However, the consequent loss or damage to a ship and cargo that arose from extinguishing a fire on board shall be allowed as a general average.

  • Voluntary Stranding

When a ship is intentionally run on shore for common safety purposes, the consequent loss to or damage on the ship and its property shall be allowed as general averages.

  • Salvage Remuneration

Expenditures incurred by the parties for common expenses that are in the nature of salvage, whether under contract or otherwise, shall be allowed in general averages, provided that the salvage operations were carried out for the purpose of preserving from peril the property involved in the common maritime adventure, and are subject to the provisions of the Rule numbered VI.

  • Lightening Expenses and Consequent Damage

When a ship is ashore, and the cargo and ship’s fuel and stores for any of them are discharged as a general averages act, the extra cost of lightening, lighter hire and reshipping (if incurred), and the loss and damage to the property involved in the common expenses in consequence thereof, shall be allowed as general averages.

  • Expenses at Port of Refuge

The general average of entering a port of refugee is one of the most common and most important types of general average[5]. When a ship has entered a port or place of refuge, or shall have returned to her port or place of loading in consequence of accident, sacrifice, or other extraordinary circumstances that render these actions necessary for common safety, the expenses incurred for entering such port or place shall be admitted as general averages.

In this respect, expenses for entry to the port of refugee, costs of discharging cargo, fuel or stores or overhauling them in the ship, re-stowage costs of the cargo, etc., are qualifying conditions of costs for as general averages, and are regulated in detail in Rule X.

Conclusion

The Communiqué on the 2016 York Antwerp Rules that regulates the general principles and types of general averages, was entered into force through publication in the Official Gazette dated 19 February 2019. Therefore, pursuant to Article 1273 of the TCC, the York Antwerp Rules dated 2016 are applicable in cases where the parties do not make an agreement as to general averages in freight contracts or bills of lading, and the dispute is subject to Turkish Law.

[1] Kender / Çetingil / Yazıcıoğlu, “Deniz Ticaret Hukuku Temel Bilgiler Cilt 1”, XII Levha, 13. Edition, Istanbul, October, 2012, p. 239.

[2] Kender / Çetingil / Yazıcıoğlu, p. 244.

[3] Kender / Çetingil / Yazıcıoğlu, p. 243.

[4] Kender / Çetingil / Yazıcıoğlu, p. 246.

[5] Çetingil / Kender / Ünan, “Müşterek Avarya Hukuku”, XII Levha, 1. Edition, İstanbul, May, 2011, p. 186.