Timjas Internship Report

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TimJasIntercontinental

Shipping Line.Live Project

2010

Jaspreet Kaur Sethi (4843)Shaheed Sukhdev College of Business Studies

Delhi University

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ACKNOWLEDGEMENTS

I would like to express my sincere thanks to TimJas

Intercontinental Shipping Line, Sinagpore for giving me the

opportunity to carry out the Summer Internship Program in their

organization. The whole period spent with the organization has been of

immense learning experience about the functioning of a Shipping Line.

Preparing a project of such a kind is not an easy task in itself and I am

sincerely thankful to all those people who help me lot, in preparing and

completing this project.

I am grateful to TimJas Intercontinental Shipping Line who has given

me this opportunity to carry out the project Financial Management

in a shipping line. .

I sincerely thank to Mr. Rajinderpal Singh (Managing Director, TimJas

intercontinental Shipping Line, Sinagpore) for providing me this

valuable learning opportunity.

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Breif Overview of a shipping line.

A shipping Line caters to many needs of its customers, which includes

forwarding, containerization and other facilities.

Forwarding

Firm specializing in arranging storage and shipping ofmerchandise on

behalf of its shippers. It

usually providesfullrange ofservices including: tracking in land

transportation, preparation of shipping and export

documents, warehousing, bookingcargo space, negotiating

freightcharges, freight consolidation, cargo insurance,

andfiling ofinsurance claims. Freight forwarders usually ship under

their ownbills oflading or air waybills (called house bill of

lading or house air waybill) and their agents or associates at the

destination (overseas freight forwarders)

provide documentdelivery, deconsolidation, and

freightcollection services. Also called forwarder.

Containerization

Containerization (or containerisation) is a system ofintermodal

freight transport using standard intermodal containers as prescribed

by the International Organization for Standardization (ISO). These can

be loaded and sealed intact onto container ships, railroad cars, planes,

and trucks.

The introduction of containers resulted in vast improvements in port

handling efficiency, thus lowering costs and helping lower freight

charges and, in turn, boosting trade flows. Most goods can be shipped

by container.

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Origin of the concept of Shipping

Origins

Although having its origins in the late 1780s or earlier, the global

standardization of containers and container handling equipment wasone of the important innovations in 20th century logistics.

By the 1830s, railroads on several continents were carrying containers

that could be transferred to trucks or ships, but these containers were

invariably small by today's standards. Originally used for shipping coal

on and off barges, 'loose boxes' were used to containerize coal from

the late 1780s, on places like the Bridgewater Canal. By the 1840s,

iron boxes were in use as well as wooden ones. The early 1900s saw

the adoption of closed container boxes designed for movementbetween road and rail.

In the United Kingdom, several railway companies were using similar

containers by the beginning of the 20th century and in the 1920s

theRailway Clearing House standardised the RCH container. Five- or

ten-foot-long, wooden and non-stackable, these early standard

containers were a great success but the standard remained UK-

specific.

From 1926 to 1947, in the US, the Chicago North Shore and MilwaukeeRailway carried motor carrier vehicles and shippers' vehicles loaded

on flatcars between Milwaukee, Wisconsin and Chicago, Illinois.

Beginning in 1929, Seatrain Lines carried railroad boxcars on its sea

vessels to transport goods between New York and Cuba. In the mid-

1930s, theChicago Great Western Railway and then the New

Haven Railroad began "piggy-back" service (transporting highway

freight trailers on flatcars) limited to their own railroads. By 1953,

theCB&Q, the Chicago and Eastern Illinois and the SouthernPacific railroads had joined the innovation. Most cars were surplus

flatcars equipped with new decks. By 1955, an additional 25 railroads

had begun some form of piggy-back trailer service.

In 1955, businessman (and former trucking company owner) Malcolm

McLean worked with engineer Keith Tantlinger to develop the

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modern intermodal container. The challenge was to design a shipping

container and devise a method of loading and locking them onto ships.

The result was a 8 feet (2.4 m) tall by 8 ft (2.4 m) wide box in 10 ft

(3.0 m) long units constructed from 25 mm (0.98 in) thick corrugated

steel. The design incorporated a twist-lock mechanism atop each ofthe four corners, allowing the container to be easily secured and lifted

using cranes. Helping McLean make the successful design, Tantlinger

convinced McLean to give the patented designs to the industry; this

began international standardization of shipping containers.

Toward the end of World War II, the United States Army used

specialized containers to speed the loading and unloading of transport

ships. The army used the term "transporters" to identify the

containers, for shipping household goods of officers in the field. A"transporter" was a reusable container, 8.5 feet (2.6 m) long,

6.25 feet (1.91 m) wide, and 6.83 feet (2.08 m) high, made of rigid

steel with a carrying capacity of 9,000 pounds. During the Korean

War the transporter was evaluated for handling sensitive military

equipment, and proving effective, was approved for broader use. Theft

of material and damage to wooden crates, in addition to handling time,

by stevedores at the Port of Pusan, convinced the army that steel

containers were needed. In 1952 the army began using the term

CONEX, short for "Container Express". The first major shipment of

CONEXes (containing engineering supplies and spare parts) were

shipped by rail from the Columbus General Depot in Georgia to the

Port of San Francisco, then by ship to Yokohama, Japan, and then to

Korea, in late 1952. Shipment times were cut almost in half. By

the Vietnam War the majority of supplies and materials were shipped

with the CONEX. After the U.S. Department of Defense standardized

an 8'8' cross section container in multiples of 10' lengths for military

use, it was rapidly adopted for shipping purposes.

These standards were adopted in the United Kingdom for containers

and largely displaced wooden containers in the 1950s. The railways of

the USSR had their own small containers.

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Purpose-built ships

Containers waiting at the South Korean port ofBusan.

Main article: Container ship

The first vessels purpose-built to carry containers began operation in

Denmark in 1951. In the U.S. ships began carrying containers between

Seattle and Alaska in 1951. The world's first intermodal container

system used the purpose-built container ship the Clifford J. Rodgers,

built in Montreal in 1955 and owned by the White Pass and Yukon

Route. Its first trip carried 600 containers between North Vancouver,

British Columbia and Skagway, Alaska, on November 26, 1955; in

Skagway, the containers were unloaded to purpose-built railroadcars for transport north to the Yukon, in the first intermodal service

using trucks, ships and railroad cars. Southbound containers were

loaded by shippers in the Yukon, moved by rail, ship and truck, to

their consignees, without opening. This first intermodal system

operated from November 1955 for many years.

The U.S. container shipping industry dates to April 26, 1956, when

trucking entrepreneur Malcom McLean put 58 containers aboard a

refitted tanker ship, the Ideal-X, and sailed themfrom Newark to Houston. What was new in the USA about McLean's

innovation was the idea of using large containers that were never

opened in transit between shipper and consignee and that were

transferable on an intermodal basis, among trucks, ships and railroad

cars. McLean had initially favored the construction of "trailerships"

taking trailers from large trucks and stowing them in a ships cargo

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hold. This method of stowage, referred to as roll-on/roll-off, was not

adopted because of the large waste in potential cargo space onboard

the vessel, known as broken stowage. Instead, he modified his original

concept into loading just the containers, not the chassis, onto the

ships, hence the designation container ship or "box" ship. (Seealso pantechnicon van and trolley and lift van.)

Towards standards

During the first twenty years of growth containerization meant using

different and incompatible, container sizes and corner fittings from one

country to another. There were dozens of incompatible container

systems in the U.S. Among the biggest operators, the Matson

Navigation Company had a fleet of 24-foot (7.3 m) containers

while Sea-Land Service, Inc used 35-foot (11 m) containers. The

standard sizes and fitting and reinforcement norms that exist now

evolved out of a series of compromises among international shipping

companies, European railroads, U.S. railroads, and U.S. trucking

companies. Four important ISO (International Organization for

Standardization) recommendations standardised containerisation

globally[8]

January 1968: R-668 defined the terminology, dimensions and

ratings

July 1968: R-790 defined the identification markings

January 1970: R-1161 made recommendations about corner

fittings

October 1970: R-1897 set out the minimum internal dimensions

of general purpose freight containers

In the United States, the Interstate Commerce Commission was

created in 1887 to keep railroads from using monopolist pricing and

rate discrimination on customers, especially rural Western farmers, but

fell victim to regulatory capture, and by the 1960s, before any shipper

could carry different items in the same vehicle, or change rates, the

shipper had to have ICC approval, which impeded containerization and

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other advances in shipping. The United States' present fully integrated

systems became possible only after the ICC's regulatory oversight was

cut back (and abolished in 1995), trucking and rail were deregulated in

the 1970s and maritime rates were deregulated in 1984.[9]

Today

A converted container used as an office at a building site

Today, approximately 9 90% of non-bulk cargo worldwide moves by

containers stacked on transport ships; 26% of all containers originate

from China. As of 2005, some 18 million total containers make over

200 million trips per year. There are ships that can carry over

14,500 Twenty-foot equivalent units (TEU), for example the Emma

Mrsk, 396 m long, launched August 2006. It has even been predicted

that, at some point, container ships will be constrained in size only by

the depth of the Straits of Malaccaone of the world's busiest shipping

laneslinking the Indian Ocean to the Pacific Ocean. This so-called Malaccamax size constrains a ship to dimensions of 470 m in

length and 60 m wide (1542 feet by 197 feet).

However, few initially foresaw the extent of the influence

containerization would bring to the shipping industry. In the 1950s,

Harvard University economist Benjamin Chinitz predicted that

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containerization would benefit New York by allowing it to ship

industrial goods produced there more cheaply to the Southern United

States than other areas, but did not anticipate that containerization

might make it cheaper to import such goods from abroad. Most

economic studies of containerization merely assumed that shippingcompanies would begin to replace older forms of transportation with

containerization, but did not predict that the process of

containerization itself would have some influence on producers and the

extent of trading.

The widespread use of ISO standard containers has driven

modifications in other freight-moving standards, gradually forcing

removable truck bodies or swap bodies into the standard sizes and

shapes (though without the strength needed to be stacked), andchanging completely the worldwide use of freight pallets that fit into

ISO containers or into commercial vehicles.

Improved cargo security is also an important benefit of

containerization. The cargo is not visible to the casual viewer and thus

is less likely to be stolen and the doors of the containers are generally

sealed so that tampering is more evident. This has reduced the "falling

off the truck" syndrome that long plagued the shipping industry.

Use of the same basic sizes of containers across the globe haslessened the problems caused by incompatible rail gauge sizes in

different countries. The majority of the rail networks in the world

operate on a 1,435 mm (4 ft 8 12 in) gauge track known as standard

gauge but many countries (such as Russia, India, Finland, and

Lithuania) use broader gauges while many other countries in Africa

and South America use narrower gauges on their networks. The use of

container trains in all these countries makes trans-shipment between

different gauge trains easier.Car shipping

Containers have become a popular way to ship vehicles overseas. Cars

can be loaded into 20 or 40 foot containers, loaded onto container

ships, and shipped to most countries. Unlikeroll-on/roll-offvehicle

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shipping, personal effects can be loaded into the container with the

vehicle, allowing for easy international relocation.

Container standards

ISO standard

Main article: Intermodal freight shipping container

There are five common standard lengths, 20-ft (6.1 m), 40-ft (12.2

m), 45-ft (13.7 m), 48-ft (14.6 m), and 53-ft (16.2 m). United States

domestic standard containers are generally 48 ft (15 m) and 53-ft (rail

and truck). Container capacity is often expressed in twenty-foot

equivalent units (TEU, or sometimes teu). An equivalent unit is a

measure of containerized cargo capacity equal to one standard 20 ft

(length) 8 ft (width) container. As this is an approximate measure,

the height of the box is not considered, for instance the 9 ft 6 in (2.9

m) High cube and the 4-ft 3-in (1.3 m) half height 20 ft (6.1 m)

containers are also called one TEU.

The maximum gross mass for a 20 ft (6.1 m) dry cargo container is

24,000 kg, and for a 40-ft (including the 2.87 m (9 ft 6 in) high cube

container), it is 30,480 kg. Allowing for the tare mass of the container,

the maximum payload mass is therefore reduced to approximately

22,000 kg for 20 ft (6.1 m), and 27,000 kg for 40 ft (12 m)

containers.

The original choice of 8 foot height for ISO containers was made in

part to suit a large proportion of railway tunnels, though some had to

be deepened. With the arrival of even taller containers, further

enlargement is proving necessary.

[edit]Air freight containers

A number of LD-designation Unit Load Device containersMain article: Unit Load Device

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While major airlines use containers that are custom designed for their

aircraft and associated ground handling equipment the IATA has

created a set of standard container sizes, the LD-designation sizes are

shown below:

DesignationWidth(in)

Height(in)

Depth(in)

Base(In)

Maxload(lb)

Maxload(kg)

Shape

LD-1 92.0 64.0 60.4 61.5 3500 ~1588 Type A

LD-2 61.5 64.0 47.0 61.5 2700 ~1225 Type A

LD-3 79.0 64.0 60.4 61.5 3500 ~1588 Type A

LD-4 96.0 64.0 60.4 n/a 5400 ~2449 Rectangular

LD-5 125.0 64.0 60.4 n/a 7000 ~3175 Rectangular

LD-6 160.0 64.0 60.4 125.0 7000 ~3175 Type B

LD-7 125.0 64.0 80.0 n/a 13300 ~6033Rect. orContoured

LD-8 125.0 64.0 60.4 96.0 5400 ~2449 Type B

LD-9 125.0 64.0 80.0 n/a 13300 ~6033 Rect. orContoured

LD-10 125.0 64.0 60.4 n/a 7000 ~3175 Contoured

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LD-11 125.0 64.0 60.4 n/a 7000 ~3175 Rectangular

LD-29 186.0 64.0 88.0 125.0 13300 ~6033 Type B

LD-1, -2, -3, -4, and -8 are those most widely used, together with the

rectangular M3 containers.

Other container system standards

Some other container systems are:

PODS

Haus-zu-Haus (House to house) (Germany)

RACE (Australia)

SECU (Sweden, Finland, UK)

ARKAS

Japanese railway containers (japanese) Containers used

by Japan Freight Railway Company

Load securing in containers

There are many different ways and materials available to stabilize and

secure cargo in containers used in all modes of transportation.

Conventional load securing methods and materials such as steel

banding and wood blocking and bracing have been around for decades

and are still widely used. Load securing methods offer several, new

and unknown options that have become available through

technological advancement including polyester strapping and -lashing,

synthetic webbings and Dunnage Bags, also known as air bags orinflatable bags.

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Issues

Increased efficiency

Although there have been few direct correlations made between

containers and job losses, there are a number of texts associating job

losses at least in part with containerization. A 1998 study of post-

containerization employment at United States ports found that

container cargo could be moved nearly twenty times faster than pre-

container break bulk. The new system of shipping also allowed for

freight consolidating jobs to move from the waterfront to points far

inland, which also decreased the number of waterfront jobs.

Additional fuel costs

Containerisation increases the fuel costs of transport and reduces thecapacity of the transport as the container itself must be shipped

around not just the goods. For certain bulk products this makes

containerisation unattractive. For most goods the increased fuel costs

and decreased transport efficiencies are currently more than offset by

the handling savings. On railway the capacity of the container is far

from its maximum weight capacity, and the weight of a railcar must be

transported with not so much goods. In some areas (mostly USA and

Canada) containers are double stacked, but this is usually not possible

in other countries.

Hazards

Containers have been used to smuggle contraband. The vast majority

of containers are never subjected to scrutiny due to the large number

of containers in use. In recent years there have been increased

concerns that containers might be used to transport terrorists or

terrorist materials into a country undetected. The U.S. government has

advanced the Container Security Initiative (CSI), intended to ensure

that high-risk cargo is examined or scanned, preferably at the port of

departure.

Empty containers

Containers are intended to be used constantly, being loaded with new

cargo for a new destination soon after having emptied of previous

cargo. This is not always possible, and in some cases, the cost of

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transporting an empty container to a place where it can be used is

considered to be higher than the worth of the used container. Shipping

lines and Container Leasing Companies have become expert at

repositioning empty containers from areas of low or no demand, such

as US West Coast, to areas of high demand such as China. However,damaged or retired containers may also be recycled in the form

ofshipping container architecture, or the steel content salvaged.

Loss at sea

Containers occasionally fall from the ships, usually during storms;

10,000 containers are lost at sea each year. For instance, on

November 30, 2006, a container washed ashore on the Outer Banks

ofNorth Carolina USA, along with thousands of bags of its cargo

ofDoritos Chips. Containers lost at sea do not necessarily sink, butseldom float very high out of the water, making them a shipping

hazard that is difficult to detect. Freight from lost containers has

provided oceanographers with unexpected opportunities to track

global ocean currents, notably a cargo ofFriendly Floatees.[16]

In 2007 the International Chamber of Shipping and the World Shipping

Council began work on a code of practice for container storage,

including crew training on parametric rolling, safer stacking and

marking of containers and security for above-deck cargo in heavyswell.[17]

Double-stack containerization

Most flatcars cannot carry more than one standard 40-foot (12.19 m)

container, but if the rail line has been built with sufficient vertical

clearance, a double-stack car can accept a container and still leave

enough clearance for another container on top. This usually precludes

operation of double-stacked wagons on lines with overhead electric

wiring. However, the Betuweroute, which was planned with overheadwiring from the start, has been built with tunnels that do

accommodate double-stacked wagons so as to keep the option to

economically rebuild the route for double stacking in the future. The

overhead wiring would then have to be changed to allow double

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stacking. Lower than standard size containers are run double stacked

under overhead wire in China.

History of double-stacking

United States/ Canada/ Mexico: Southern Pacific

Railroad (SP), with Malcom McLean, came up with the idea of the

first double-stack intermodal car in 1977. SP then designed the first

car with ACF Industries that same year. At first it was slow to

become an industry standard, then in 1984 American President

Lines, started working with the SP and that same year, the first all

"double stack" train left Los Angeles, California for South Kearny,

New Jersey, under the name of "Stacktrain" rail service. Along theway the train transferred from the SP to Conrail. It saved shippers

money and now accounts for almost 70 percent ofintermodal

freight transport shipments in the United States, in part due to the

generous vertical clearances used by U.S. railroads. These lines are

diesel operated with no overhead wiring.

Australia: Double stacking is also used in Australia between

Adelaide, Parkes, Perth and Darwin. These are diesel only lines with

no overhead wiring. Tunnels prevent extension of service to

Melbourne, Sydney and Brisbane.

India: Double stacking in India is used for selected freight-

only lines, on electrified lines with specially high overhead 25kV

AC wiring.

China: using double stacked container trains under 25kV

AC overhead lines.

Wagons

Railways have flat wagons and well cars that can hold 40' ISO

containers.

Narrow gauge railways of 610 mm (2 ft) gauge have smaller wagons

that do not readily carry ISO containers, nor do the 30-foot (9.14 m)

long and 7-foot (2.13 m) wide wagons of the762 mm (2

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ft 6 in) gauge Kalka-Shimla Railway. Wider narrow gauge railways of

e.g. 914 mm (3 ft) and 1,000 mm (3 ft 3 38 in) gauge can take ISO

containers, provided that the loading gauge allows it.

Other uses for containers

Shipping container architecture is the use of containers as the basis for

housing and other functional buildings for people, either as temporary

housing or permanent, and either as a main building or as a cabin or

workshop. Containers can also be used as sheds or storage areas in

industry and commerce.

Containers are also beginning to be used to house computer data

centers, although these are normally specialized containers.Companies

Biggest ISO container companies

Top 20 container shipping companies in order of TEU capacity, 18 May2010

Company TEU capacity[23] Number of ships

A.P. Moller-Maersk Group 2,045,776 545

Mediterranean Shipping CompanyS.A.

1,638,962 414

CMA CGM 1,100,007 384

American President Lines 589,879 147

Evergreen Marine Corporation 554,725 152

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Hapag-Lloyd 541,811 124

COSCO 498,437 134

CSAV 469,428 128

Hanjin Shipping 448,051 98

China Shipping Container Lines 440,236 122

NYK Line 365,034 95

Mitsui O.S.K. Lines 363,188 94

Orient Overseas Container Line 353,338 77

Hamburg Sd 338,778 109

Zim Integrated Shipping Services 322,685 96

K Line 318,193 82

Yang Ming Marine TransportCorporation

313,379 77

Hyundai Merchant Marine 271,604 52

Pacific International Lines 227,649 126

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UASC 199,082 50

INTERNATIONAL shipping laws

Admiralty law (also referred to as maritime law) is a distinct body

oflaw which governs maritime questions and offenses. It is a body of

both domestic law governing maritime activities, and private

international law governing the relationships between private entities

which operate vessels on the oceans. It deals with matters including

marine commerce, marine navigation, shipping, sailors, and the

transportation of passengers and goods by sea. Admiralty law also

covers many commercial activities, although land based or occurring

wholly on land, that are maritime in character.

Admiralty law is distinguished from the Law of the Sea, which is a

body of public international law dealing with navigational

rights, mineral rights, jurisdiction over coastal waters and international

law governing relationships between nations.

Although each legal jurisdiction usually has its own enacted legislation

governing maritime matters, admiralty law is characterized by a

significant amount of international law developed in recent decades,

including numerous multilateral treaties.

History of admiralty law

Seaborne transport was one of the earliest channels of commerce, and

rules for resolving disputes involving maritime trade were developed

early in recorded history. Early historical records of these laws include

the Rhodian law (of which no primary written specimen has survived,

but which is alluded to in other legal texts: Roman and Byzantine legal

codes) and later the customs of the Hanseatic League. In southern

Italy theOrdinamenta et consuetudo maris (1063) at Trani and

the Amalfian Laws were in effect from an early date.

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Islamic law also made major contributions to international admiralty

law, departing from the previous Roman and Byzantine maritime laws

in several ways. These included Muslim sailors being "paid a

fixed wage in advance with an understanding that they would owe

money in the event ofdesertion or malfeasance, in keeping withIslamic conventions" in which contracts should specify a known fee

for a known duration, in contrast to Roman and Byzantine sailors who

were "stakeholders in a maritime venture, in as much as captain and

crew, with few exceptions, were paid proportional divisions of a sea

ventures profit, with shares allotted by rank, only after a voyages

successful conclusion". Muslim jurists also distinguished between

"coastal navigation, or cabotage", and voyages on the high seas, and

they also made shippers "liable for freight in most cases excepttheseizure of both a ship and its cargo". Islamic law also "departed

from Justinians Digest and the Nomos Rhodion Nautikos in

condemning slave jettison", and the Islamic Qirad was also a precursor

to the European commenda limited partnership. The Islamic influence

on the development of an international law of the sea can thus be

discerned alongside that of the Roman influence.

Admiralty law was introduced into England by Eleanor of

Aquitaine while she was acting as regent for her son, King Richard the

Lionheart. She had earlier established admiralty law on the island

ofOleron (where it was published as the Rolls of Oleron) in her own

lands (although she is often referred to in admiralty law books as

"Eleanor of Guyenne"), having learned about it in the eastern

Mediterranean while on a Crusade with her first husband, King Louis

VII of France. In England, special admiralty courts handle all admiralty

cases. These courts do not use the common law of England, but

are civil law courts largely based upon the Corpus Juris

Civilis ofJustinian.

Admiralty courts were a prominent feature in the prelude to

the American Revolution. For example, the phrase in the Declaration of

Independence For depriving us in many cases, of the benefits of Trial

by Jury refers to the practice of Parliament giving the Admiralty

Courts jurisdiction to enforce The Stamp Act in the American Colonies.

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[2] Because the Stamp Act was unpopular, a colonial jury was unlikely

to convict a colonist of its violation. However, because admiralty courts

did not (as is true today) grant trial by jury, a colonist accused of

violating the Stamp Act could be more easily convicted by the Crown.

Admiralty law became part of the law of the United States as it was

gradually introduced through admiralty cases arising after the adoption

of the U.S. Constitution in 1789. Many American lawyers who were

prominent in the American Revolution were admiralty and maritime

lawyers in their private lives. Those included are Alexander

Hamilton in New York and John Adams in Massachusetts.

In 1787 Thomas Jefferson, who was then ambassador to France, wrote

to James Madison proposing that the U.S. Constitution, then under

consideration by the States, be amended to include "trial by jury in all

matters of fact triable by the laws of the land [as opposed the law of

admiralty] and not by the laws of Nations [i.e. not by the law of

admiralty]". The result was the Seventh Amendment to the U.S.

Constitution. Alexander Hamilton and John Adams were both admiralty

lawyers and Adams represented John Hancock in an admiralty case in

colonial Boston involving seizure of one of Hancock's ships for

violations of Customs regulations. In the more modern era, Supreme

Court Justice Oliver Wendell Holmes was an admiralty lawyer beforeascending to the federal bench.

Features of admiralty law

Maintenance and cure

The doctrine of maintenance and cure is rooted in the Article VI of the

Rules of Oleron promulgated in about 1160 A.D. The obligation to

"cure" requires a shipowner to provide medical care, free of charge, to

a seaman injured in the service of the ship, until the seaman has

reached "maximum medical cure". The concept of "maximum medicalcure" is more extensive than the concept "maximum medical

improvement". The obligation to "cure" a seaman includes the

obligation to provide him with medications and medical devices which

improve his ability to function, even if they don't "improve" his actual

condition. They may include long term treatments permit him to

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continue to function well. Common examples include prostheses,

wheelchairs, and pain medications.

The obligation of "maintenance" requires the shipowner to provide a

seaman with his basic living expenses while he is convalescing. Once a

seaman is able to work, he is expected to maintain himself.

Consequently, a seaman can lose his right to maintenance, while the

obligation to provide cure is ongoing.

A seaman who is required to sue a shipowner to recover maintenance

and cure may also recover his attorneys fees. Vaughan v. Atkinson,

369 U.S. 527 (1962). If a shipowner's breach of its obligation to

provide maintenance and cure is willful and wanton, the shipowner

may be subject to punitive damages.

Personal injuries to passengers

Shipowners owe a duty of reasonable care to passengers (for a broad

overview of this theory in law, see negligence). Consequently,

passengers who are injured aboard ships may bring suit the same as if

they had been injured ashore through the negligence of a third party.

The passenger bears the burden of proving that the shipowner was

negligent. While the statute of limitations is generally three years,

suits against cruise lines must usually be brought within one year

because of limitations contained in the passenger ticket. Notice

requirements in the ticket may require a formal notice to be brought

within six months of the injury. Most U.S. cruise line passenger tickets

also have provisions requiring that suit to be brought in

eitherMiami or Seattle.

]Maritime liens and mortgages

Banks which loan money to purchase ships, vendors who supply

ships with necessaries like fuel and stores, seamen who are due

wages, and many others have a lien against the ship to guarantee

payment. To enforce the lien, the ship must be arrested or seized.

An action to enforce a lien against a U.S. ship must be brought in

federal court and cannot be done in state court.

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Salvage and treasure salvage

When property is lost at sea and rescued by another, the rescuer

is entitled to claim a salvage award on the salved property. There

is no "life salvage". All mariners have a duty to save the lives of

others in peril without expectation of reward. Consequently

salvage law applies only to the saving of property.

There are two types of salvage: contract salvage and pure salvage,

which is sometimes referred to as "merit salvage". In contract

salvage the owner of the property and salvor enter into a salvage

contract prior to the commencement of salvage operations and the

amount that the salvor is paid is determined by the contract. The

most common salvage contract is called a "Lloyds Open Form

Salvage Contract".

In pure salvage, there is no contract between the owner of the

goods and the salvor. The relationship is one which is implied by

law. The salvor of property under pure salvage must bring his

claim for salvage in federal court, which will award salvage based

upon the "merit" of the service and the value of the salvaged

property.

Pure salvage claims are divided into "high-order" and "low-order"

salvage. In high-order salvage, the salvor exposes himself and his

crew to the risk of injury and loss or damage to his equipment in

order to salvage the damaged ship. Examples of high-order

salvage are boarding a sinking ship in heavy weather, boarding a

ship which is on fire, raising a ship or boat which has already sunk,

or towing a ship which is in the surf away from the shore. Low-

order salvage occurs where the salvor is exposed to little or no

personal risk. Examples of low-order salvage include towing

another vessel in calm seas, supplying a vessel with fuel, or pullinga vessel off a sand bar. Salvors performing high order salvage

receive substantially greater salvage award than those performing

low order salvage.

In both high-order and low-order salvage the amount of the

salvage award is based first upon the value of the property saved.

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If nothing is saved, or if additional damage is done, there will be

no award. The other factors to be considered are the skills of the

salvor, the peril to which the salvaged property was exposed, the

value of the property which was risked in effecting the salvage, the

amount of time and money expended in the salvage operation etc.

A pure or merit salvage award will seldom exceed 50 percent of

the value of the property salved. The exception to that rule is in

the case of treasure salvage. Because sunken treasure has

generally been lost for hundreds of years, while the original owner

(or insurer, if the vessel was insured) continues to have an interest

in it, the salvor or finder will generally get the majority of the

value of the property. While sunken ships from the Spanish

Main (such as Nuestra Seora de Atocha in the Florida Keys) arethe most commonly thought of type of treasure salvage, other

types of ships including German submarines from World War II

which can hold valuable historical artifacts, American Civil

War ships (the USS Maple Leaf in theSt. Johns River, and

the CSSVirginia in Chesapeake Bay), and sunken merchant ships

(the SSCentral America offCape Hatteras) have all been the

subject of treasure salvage awards.[citation needed] Due to refinements

in side-scanning sonars, many ships which were previously missing

are now being located and treasure salvage is now a less risky

endeavor than it was in the past, although it is still highly

speculative.

International conventions

Prior to the mid-1970s, most international conventions concerning

maritime trade and commerce originated in a private organization

of maritime lawyers known as the Comit Maritime

International (International Maritime Committee or CMI). Foundedin 1897, the CMI was responsible for the drafting of numerous

international conventions including the Hague Rules (International

Convention on Bills of Lading), the Visby Amendments (amending

the Hague Rules), the Salvage Convention and many others. While

the CMI continues to function in an advisory capacity, many of its

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functions have been taken over by the International Maritime

Organization, which was established by the United Nations in 1958

but did not become truly effective until about 1974.

The IMO has prepared numerous international conventions

concerning maritime safety including the Safety of Life at Sea

Convention (SOLAS), the Standards for Training, Certification, and

Watchkeeping (STCW), the Collision Regulations (COLREGS),

Maritime Pollution Regulations (MARPOL), International

Aeronautical and Maritime Search and Rescue

Convention(IAMSAR) and others. The United Nations Convention

on the Law of the Sea (UNCLOS) defined a treaty regarding

protection of the marine environment and various maritime

boundaries.

Once adopted, the international conventions are enforced by the

individual nations which are signatories, either through their

local Coast Guards, or through their courts.

Piracy

Merchant vessels transiting areas of increased pirate activity (ie

the Gulf of Aden, Somali Basin, Southern Red Sea and Bab-el-

Mandeb straits) are advised to implement Self-Protective measures

in accordance with most recent Best Management Practices agreed

upon by the members of the merchant industry, and endorsed by

the NATO Shipping Centre, and the Maritime Security Centre Horn-

of-Africa (MSCHOA)

In individual countries

Maritime law of common law countries

Most of the common law countries

(including Pakistan, Singapore, India, Canada, and manyother Commonwealth of Nations countries) follow English statutes

and case law. India still follows many Victorian-era British statutes

such as the Admiralty Court Act, 1861 [24 Vict c 10]. Whilst

Pakistan now has its own statutes such as the Admiralty

Jurisdiction of High Courts Ordinance, 1980 (Ordinance XLII of

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1980), it still follows English case law. One reason for this is that

Pakistani law is partly modelled on old English admiralty law as

defined in the Administration of Justice Act, 1956. The current

statute dealing with the Admiralty jurisdiction of the England and

Wales High Court in Pakistan is the Supreme Court Act, 1981(sec.20-24,37). This statute is, in turn, based on the International

Arrest Convention 1952. Other countries which do not follow the

English statutes and case laws such as Panama also have

established well-known maritime courts which decide international

cases on a regular basis.

Admiralty Courts assume jurisdiction by virtue of the presence of

the vessel in its territorial jurisdiction irrespective of whether the

vessel is national or not and whether registered or not andwherever the residence or domicile or their owners may be. A

vessel is usually arrested by the court to retain jurisdiction. State

owned vessels are usually immune from arrest.

In the United States

Jurisdiction

Article III, Section 2 of the United States Constitution grants

original jurisdiction to U.S. federal courts over admiralty and

maritime matters, however that jurisdiction is not exclusive andmost maritime cases can be heard in either state or federal courts

under the "saving to suitors" clause.[4]

There are five types of cases which can only be brought in federal

court: Limitation of Shipowner's Liability, Vessel Arrests in Rem,

Property arrests Quasi in Rem, Salvage cases, and Petitory and

Possession Actions. The common element of those cases are that

they require the court to exercise jurisdiction over maritime

property. For example, in a Petitory and Possession Action, avessel whose title is in dispute, usually between co-owners, will be

put in the possession of the court until the title dispute can be

resolved. In a Limitation Action the shipowner will post a bond

reflecting the value of the vessel and her pending freight. A sixth

category, that ofprize (law), relating to claims over vessels

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captured during wartime, has been rendered obsolete due to

changes in the laws and practices of warfare.

Aside from those five types of cases, all other maritime cases,

such as claims for personal injuries, cargo damage, collisions,

maritime products liability, and recreational boating accidents may

be brought in either federal or state court.

From a tactical standpoint it is important to consider that in federal

courts in the United States, there is generally no right to trial by

jury in admiralty cases, although the Jones Act grants a jury trial

to seamen suing their employers.

Maritime law is governed by a uniform three year statute of

limitations for personal injury and wrongful death cases. Cargocases must be brought within two years (extended from the one-

year allowance under the Hague-Visby Rules), pursuant to the

adoption of the Rotterdam Rules]. Most major cruise ship

passenger tickets have a one year statute of limitations.

Applicable law

A state court hearing an admiralty or maritime case is required to

apply the admiralty and maritime law, even if it conflicts with the

law of the state, under a doctrine known as the "reverse-Erie

doctrine". While the "Erie doctrine" requires that federal courts

hearing state actions must apply substantive state law, the

"reverse-Erie doctrine" requires state courts hearing admiralty

cases to apply substantive federal admiralty law. However, state

courts are allowed to apply state procedural law. This change can

be significant.

Features of U.S. admiralty law

Cargo claims

Claims for damage to cargo shipped in international commerce are

governed by the Carriage of Goods by Sea Act (COGSA), which is

the U.S. enactment of the Hague Rules. One of its key features is

that a shipowner is liable for cargo damaged from "hook to hook",

meaning from loading to discharge, unless it is exonerated under

one of 17 exceptions to liability, such as an "act of God", the

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inherent nature of the goods, errors in navigation, and

management of the ship.

]Personal injuries to seamen

Seaman injured aboard ship have three possible sources of

compensation: the principle of maintenance and cure, the doctrine

of unseaworthiness, and the Jones Act. The principle of

maintenance and cure requires a shipowner to both pay for an

injured seaman's medical treatment until maximum medical

recovery (MMR) is obtained and provide basic living expenses until

completion of the voyage, even if the seaman is no longer aboard

ship.

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References

Throughout the span of creating this report, I have taken the help ofvarious sources. Some of these sources were used for literary ways,others simply for support and knowledge enrichment. Either ways, I am

sincerely grateful.

1. Www. Wikipedia .com2. Www. Google.com3. Www. Cosco.com4. Www. TimJasinternational.com5. Www.containersordummies .com6. Www. Ask.com7. Www. Cluemein.com

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Thank you