GENERAL AVERAGE: UPDATE ON THE LATEST (2016) YORK-ANTWERP RULES
Maritime interests have long recognised that parties to a maritime adventure should share in those losses necessarily incurred to ensure its success. So, where cargo must be jettisoned at sea in order to save the ship and other cargo on board, the merchant whose cargo was jettisoned may seek to recover from the ship owner and other cargo merchants under the principles of general average.
The first set of York-Antwerp Rules was developed over a hundred years ago in an attempt to standardise general average calculations and allowances. The York-Antwerp Rules have no legislative effect but are routinely incorporated by contractual agreement into charterparties, bills of lading and sea waybills. A previous revision to the York-Antwerp Rules in 2004 did not receive widespread approval from ship owners. Until recently, many standard form contracts (including those produced by BIMCO) continued to reference the 1994 or 1974 set of York-Antwerp Rules.
In May 2016, the Comité Maritime International (CMI) adopted the latest set of York-Antwerp Rules, known as the YAR 2016. The CMI has also published a set of guidelines to the YAR 2016. Although these guidelines do not form part of the YAR 2016 and as such have no binding legal effect, they provide practical guidance and a useful starting point for better understanding the YAR 2016 and general average practices.
BIMCO has since announced that all new and revised BIMCO charterparties, bills of lading and sea waybills will incorporate the YAR 2016 for the purposes of general average adjustments. The International Union of Marine Insurance (IUMI) too has welcomed the revisions to the YAR 2016.
While it remains too early to say whether the YAR 2016 will gain widespread approval within the maritime community, the positive response from BIMCO and IUMI suggest that it will be more popular than its 2004 predecessor.