The Association is grateful to Wai Yue Loh of Ince & Co, Beijing, for contributing to this update.
When freight has not been paid, Owners / Operators need to consider how best to secure their position as against the defaulting party. One of the main traditional options was to seek a lien on cargo for the unpaid freight.
Exercising liens, however, can be a practically challenging task.
Key points to the successful exercise of a lien, include:
- there must be a right of lien under the charterparty
- that right of lien must also exist in the contract of carriage
- sufficient steps need to be taken to exercise the lien in due time
- the lien must be recognised by the law of the country in which it is sought to be exercised
- there must be practical means of securely holding on to the cargo
In the article accompanying this update, Ince & Co illustrate the issues of seeking to exercise a lien in the P.R. China. Given the importance of China to maritime trade and the volume of cargo consigned to her ports, it is a frequent topic on which the Association is asked to give advice on for our Members.