Evergiven Still Stuck In Suez Canal - Getting Properly Screwed Over - Not So Funny
The Suez Canal has seized the Evergiven vessel which is owned by a Japanese/Taiwan consortium until a fine has been paid. The canal lost a serious amount of money whilst it was closed due to the vessel running aground and blocking their lucrative "ship toll" high way.
source Maersk Emerald ran aground yesterday and had to be towed but obviously wasn't a huge problem as the size of the vessel and where it happened was not so severe.
I only found out the Evergiven was still there after another ship ran aground last night but was not so serious as the vessel the Maersk Emerald is roughly 3 x smaller and was refloated within hours. The Egyptian President has now reported it will widen and deepen the Suez Canal as this could be a regular problem in the future.
source Evergiven today under "house arrest" in the Bitter Lakes which form part of the Suez Canal.
Don't laugh as it is not only the ship owners who are being screwed but every person/company that has containers on board the vessel. I must admit I was a little shocked that this type of thing was even legal and surely the Suez Canal Authority should just be happy the canal is open and a lesson learned. They make enough money out of it daily and it is not as though they were squeaky clean in this incident either.
The owners of the Evergiven have been in court arguing that the canal should have been closed due to the high winds on the day of the accident. The Egyptian court rejected these claims saying that excessive speed was the main cause for the accident and not the wind.
What I find a little crazy is the Suez Canal authority had 2 pilots on board the vessel when the accident happened. Apparently this doesn't change anything as they are there in an "advisary" capacity only.
Liability:Pursuant to the Egyptian Maritime Code No. 8 of 1990 (Art. 279) as well as rulings of the Supreme Court in Egypt, the responsibility for pilotage operation in port and in the Suez Canal lies entirely with the Master of the guided vessel even in case of the pilots error.
The fine or ransom for the vessel is $916 million dollars which is rather large considering all the goods stuck on board. The problem is not the fine but the amount and how it was calculated. This is where the story gets interesting and why everyone and their dog wanted to be part of this "salvage" operation.
Under Egyptian law the payment for salvaging of a vessel is calculated by the value of the vessel plus the goods on board. This is seen as a salvage bonus with all parties involved receiving a "fair" payment. The Evergiven insurers UK P&I Club disagree with this figure as it is a thumb suck. The authorities value the vessel and goods at $2 Billion as the owners have no idea of the value of goods on board.
We are talking about this two months after the incident and what about the cargo onboard the vessel? Another curved ball which can be blamed on the ancient maritime law states that owners of these goods will have to help fund payments to receive their goods. What if you are a small business and reliant on what you have paid out for those goods already.
Shoei Kisen is asking clients with cargo on board to pay part of the costs of freeing the ship from the canal bank, which are estimated at about $2 million, according to people involved in the matter.
That was then and that price seems like a bargain compared to the latest billing/fine being asked for now. The insurance covering the vessel is $3 billion for liabilities but they need to tread carefully as when and if this payment is resolved there could be another claim coming from other vessels who lost business or goods whilst waiting. This figure could be closer to $6 billion if the reports are correct.
What is obvious is everyone expects the $916 million fee to be slashed with negotiations and is a case of who blinks first. The Suez Canal has already offered it will accept a $200 Million deposit with the rest to be paid later. Interesting story this as maritime law is obviously not so straight forward and all depends on where you are in the world. I would have thought the Suez Canal Authorities would have just been happy having their canal back working and this sounds a little greedy to me.
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