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Home» Circulars» Guidelines To Major Ports On Exemptions Remission On Penalties Etc. And Issues Relating To Force Majeure

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Guidelines to Major Ports on Exemptions / Remission on penalties etc. and issues relating to Force Majeure
 
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EPC/LIC/MIS Date: 02-04-2020
 

Guidelines to Major Ports on Exemptions / Remission on penalties etc. and issues relating to Force Majeure with regard to Disruption on account of Corona Virus

 
To
ALL THE MEMBERS OF THE COUNCIL
 
Sub: Guidelines to Major Ports on Exemptions / Remission on penalties etc. and issues relating to Force Majeure

Dear Member,
 
 
 

Ministry of Home Affairs, Government of India  has  issued Order No. 40-3/2020-DM-I (A) dated  24th March, 220 to impose lockdown for a period of 21 days to contain COVID-19 pandemic in the country.  

 

 

We understand from Trade Notice that Ministry of Home Affairs, Government of India  has issued an addendum in view of the situation against their Order No. 40-3/2020-DM-I(A) dated 25.03.2020 specifically giving exceptions to the operations of seaports for cargo movement and inter-state movement of goods/cargo for inland and exports to ensure regular supply of goods in the country. Government has made it clear that the smooth functioning of the ports remain vital for the country as ports are the main source of import and export of goods.

 

 All Major Ports have been advised:

 

 i)  shall ensure that no penalties, demurrage charges, fee, rentals are levied by the Major ports on any port user (traders, shipping lines, concessionaires, licensees etc.) for any delay in berthing, loading / unloading operations or evacuation / arrival of cargo caused by the reasons attributable to lockdown measures from 22nd March to 14th April, 2020.

 

 ii)   All Major Port shall exempt or remit demurrage, ground rent over and above the free period, penal anchorage/berth hire charges and any other performance related penalties that may be levied on port related activities including minimum performance guarantee, wherever applicable.

 

  

We also understand that Ministry of Shipping, Government of India  has issued  Order No. PD-13/33/2020-PPP/e-339106 dated  20.03.2020  and letter dated 24-03-2020 intimated to all the Major Ports that the COVID-19 pandemic can be considered as a ‘natural calamity’ that would entitle invocation of ‘force majeure’ provisions inasmuch as obligations under various contract (involving the Major ports) are concerned.

  

IN view of the situation arising because of the COVID-19 pandemic all Major Ports also have been advised:

 

i)                  The aforesaid orders do not impact or dilute the fact that each major port needs to remain operational during the COVID-19 pandemic and continue cargo operations in all respects.

 

ii)                The period for completion of any project under implementation in PPP mode or otherwise, can be extended by the ports.

  

iii)             For existing and operation PPP projects, the major ports can permit waiver of all penal consequences on a case-to-case basis along with deferment of performance obligations as per relevant provision of concession agreement.

 

iv)              The period of Force Majeure starts against OM No. 18/4/2020/PPD dated 19-03-2020 of Ministry of Finance referred and will end when the competent authority so orders.

 

v)                The above order issues under section 111 of Major Port Trusts Act, 1963 with the approval of Hon’ble Minister of State for Shipping (IC) and to be implemented with immediate effect.

  

Members are requested to take note of these steps taken by Ministry of Shipping, Government of India with regard to Disruption on account of Corona Virus and take it forward accordingly. The said Guideline No. PD-14300/4/2020-PD VII dated 31.03.2020 is enclosed herewith for your ready reference.

 Members  may also  send their comments/ feed-back  on  our e-mail id’s:  ed@chemexcil.gov.in  & deepak.gupta@chemexcil.gov.in.

 

 
 
 
With Best Regards

S G Bharadi
Executive Director
CHEMEXCIL
 
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