Inter-Club Agreement (as amended 1 September 2011)
The Inter-Club New York Produce Exchange Agreement, generally referred to as the Inter-Club Agreement (ICA), has provided a relatively simple mechanism for swiftly and fairly apportioning liability for cargo claims arising under New York Produce Exchange Form (NYPE) or Asbatime charterparties. It can also apply to contracts of carriage authorised under such charterparties.
An important revision to the 'Inter-Club Agreement' takes effect from the 1st September this year. Our Club, in common with the other Group clubs is issuing a circular to inform Members of this change.
Under this new provision once one of the parties to a charterparty has put up security in respect of a cargo claim, provided the time limits set out in clause 6 of the agreement have been complied with, there is an entitlement to security on the basis of reciprocity.
The new 'Security Provision' is found in clause 9 of this 2011 agreement.
As the new agreement takes effect from 1st September 2011, we recommend its incorporation into all NYPE and Asbatime charterparties going forward.
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You may also be interested in:
QCR Autumn 2018: Whether the ICA 2011 had been incorporated in full into charterparty so as to require charterers to provide counter-security
London Arbitration 18/18 (2018) 1010 LMLN 2
The ICA, or to give it its full name The Inter-Club New York Produce Exchange Agreement, is an IG approved clause for the apportionment of cargo claims. It aims to provide a mechanism by which claims can be quickly apportioned between owners and charterers without the need for costly or extensive litigation. It also contains provisions for security and time bars for notification of claims.
The purpose of the ICA is to avoid lengthy and costly litigation on matters of liability and apportionment, and instead seeks to provide a 'rough and ready' split of liability between the parties. The Clubs recommend to their Members that they adopt the Agreement for the purpose of apportioning liability for claims in respect of cargo which arise under, out of or in connection with all charterparties on the NYPE Form 1946 or Asbatime Form 1981, whether or not this Agreement has been incorporated into such charterparties. However, unless the ICA is specifically incorporated into the charterparty, it may not be enforceable.