Introduction
International shipping has entered a new era of sustained geopolitical disruption. A series of entrenched regional conflicts affecting some of the world's most strategically vital maritime chokepoints—including the Arabian Sea and Strait of Hormuz, the Red Sea, and the Black Sea—has fundamentally altered the risk landscape for shipowners and charterers alike. Against this background, disputes are inevitable where charterers direct vessels to proceed to or through areas that owners consider present an unacceptable risk.
This article provides a practical checklist of the key charterparty provisions to consider when assessing how owners should respond in these circumstances.
The "Theatres" of conflict
Strait of Hormuz / Persian Gulf
Hostilities between the United States/Israel, and Iran continue to pose a significant threat to merchant shipping in the Strait of Hormuz and a significant challenge to vessels 'trapped' in the Persian Gulf. Although some commercial traffic has resumed intermittently, the security situation remains volatile with high threat levels and elevated insurance premiums. Iranian forces continue to challenge US-led maritime security operations, while the United States has maintained naval measures intended to restrict Iranian maritime activity.
Gulf of Oman
The Gulf of Oman remains an extension of the broader US-Iran maritime confrontation, with heightened naval activity and persistent risks to merchant shipping. US forces continue to enforce maritime interdiction measures against vessels suspected of carrying Iranian exports, while Iran has sought to challenge these operations through naval deployments and indirect threats.
Red Sea
Since the beginning of the conflict in the Persian Gulf between the US and Iran, the threat to merchant shipping in the Red Sea from Houthi forces has been elevated. The Houthis still appear to have the capability and intent to target commercial vessels using missiles, drones and unmanned surface craft, particularly against ships perceived to be linked to the United States, Israel or their partners.
However, no attacks have occurred until very recently, when the Houthis announced a maritime embargo on Saudi Arabian vessels and claimed to have since hit two tankers flying the Saudi flag (as well as carrying out attacks on Saudi oil depots).
Black Sea / Sea of Azov
The security environment for merchant shipping in the Black Sea and Sea of Azov has deteriorated markedly as both Ukraine and Russia have expanded attacks on maritime targets. Ukraine has intensified long-range drone operations against Russian logistics and so-called "shadow fleet" vessels operating in the Sea of Azov and the Black Sea, with Ukraine's Unmanned Systems Forces reporting having hit 126 Russian shadow fleet vessels in the Sea of Azov and 70 in the Black Sea between 6 and 22 July 2026. However, recently, it has been reported that Ukrainian drones have struck several vessels, which are not said to be listed as part of the shadow fleet.
At the same time, Russia has continued missile and drone strikes against Ukrainian ports and commercial shipping.
Shipping through parts of the Black Sea corridor has been temporarily suspended by commercial operators due to the escalating threat. The International Maritime Organization has again condemned attacks affecting civilian shipping. At the same time, mine hazards, drone strikes and military operations continue to present significant risks to merchant vessels operating in the region.
Charterparty considerations
The following discusses some of the important charterparty provisions to keep in mind when considering whether the vessel should proceed to a war-affected area, if requested.
War Risks Clauses
The most important clauses in the Charterparty are likely to be the war risk provisions.
In principle, such a clause could take a limitless variety of forms, but in 'dry' charters it is likely to be one of the standard war risks provisions, such as the BIMCO CONWARTIME or VOYWAR Clauses.
CONWARTIME & VOYWAR
Under CONWARTIME 1993, for instance, an owner is not required to continue to or through any port, place, area or zone or any waterway where it appears that the Vessel, her crew or cargo "in the reasonable judgement of the Master and/or the Owners, may be, or are likely to be, exposed to War Risks".
The words "may be, or are likely to be" have been construed as requiring "a real likelihood", "real danger" and/or "a serious possibility" of exposure to danger. The mere possibility of exposure will not suffice. Furthermore, in making an assessment of the exposure, the judgement of Owners / the Master must be made in good faith and be objectively reasonable (see The Triton Lark [2012] 1 Lloyd’s Rep 151). This approach also applies to the more recent CONWARTIME clauses (of 2013 and 2025), notwithstanding their revised wording.
There are, however, some important differences between the various iterations of the CONWARTIME clause to be aware of. Perhaps most practically relevant is that the relevant notice periods that owners must give charterers (for instance in requesting alternative voyage instructions) have been changed under the 2025 clause, from 48 to 72 hours.
It is also worth noting that, unlike their predecessors, the 2013 and 2025 clauses state expressly that they may be engaged "whether such risk existed at the time of entering into this Charter Party or occurred thereafter". This may (or may not) be significant depending on the circumstances of the relevant case (as discussed below).
Tanker Charterparties: Beepeetime 2, ASBATANKVOY and Shelltime 4
Tanker charterparties often include a variety of distinct war risks provisions. For example, Clause 35 of the Shelltime 4 form provides that if (because of war or hostilities etc.) in the "reasonable opinion of the master or Owners", it becomes dangerous for the vessel to reach or enter, or to load or discharge at any place to which the vessel has been ordered, the charterers, having been notified of the situation, shall "have the right to order the cargo … to be loaded or discharged .. at any other place within the trading limits".
To take another example, Clause 40(2) of the Beepeetime 2 charterparty (which is materially similar to Clause 20(b) of the ASBATANKVOY form) refers to the "discretion" of the Master or Owners when assessing the relevant danger. It has been held that the discretion to be exercised under clause 40 must be exercised honestly and in good faith, and not arbitrarily, unreasonably or capriciously (see The Product Star (No. 2) [1991] 2 Lloyd’s Rep. 468, in which the case the degree of risk had not increased since the date of the charterparty and owners’ refusal to proceed was considered, on those facts, to be arbitrary).
Risk assessment
One of the means by which the "objective reasonableness" of owners' judgement may be demonstrated is if it is supported by the findings of a detailed risk assessment for the specific vessel for the particular voyage (The Triton Lark [2012] 1 Lloyd’s Rep 151). Such a risk assessment should therefore be considered wherever feasible in situations where owners are considering their entitlement to refuse to proceed to (or remain at) a particular location. There are companies which will conduct independent risk assessments on behalf of owners if that is preferable.
An independent risk assessment may be vital in situations where Owners are considering whether they are entitled to refuse to proceed to, or remain at, a particular location. The report can assist without prejudice discussions with charterers in seeking a common solution and may also serve as crucial evidence if the matter cannot be resolved amicably.
Owners will often be pressured to comply with time charterers' voyage instructions forthwith, not least in view of owners' general obligation to proceed with utmost dispatch. However, it is important to bear in mind that owners are not obliged to comply with time charterers' orders immediately. They are, instead, generally entitled to a "reasonable" period of time to consider the safety implications of compliance and whether the orders are, in fact, legitimate (see The Houda [1994] 2 Lloyd's Rep 541). Subject, again, to the particular charterparty terms and surrounding circumstances, this should generally be a period of time that will allow owners to conduct a sufficiently thorough risk assessment and to take legal advice, where necessary.
Although in isolation, the standard war risks clauses may well entitle owners to refuse to proceed to a particular area, as will be seen, the position under the war risks clause may only be part of the story.
Assumption of risk
Specific provisions regarding permitted areas
Notwithstanding the wording of the relevant war risks clause, an owner will generally not be entitled to refuse to proceed to a particular area if, by the terms of the charterparty, construed in its factual context, the owner has accepted a particular war risk involved in trading to a particular area (see The Paiwan Wisdom [2012] EWHC 1888 (Comm)).
In this regard, the relevant charterparty must be reviewed carefully for any provisions, that expressly permit trade to a particular location, notwithstanding that it may be affected by war. Further, a charterparty may contain a provision anticipating that the vessel must trade to the region: the most obvious examples would be if the location, or a port in the location, is named or if there is a provision to the effect that trade to a particular place is "always allowed" (although the possible variants of such provisions are limitless). The charterparty may also contain comprehensive provisions for additional war risks insurance premia for trading to a particular location which will make it more difficult for owners to refuse to proceed to such a location if charterers are willing to pay the increased premium.
Exactly how such provisions will interrelate with a war risks clause and, in turn, entitle owners to refuse to proceed to a war-affected area will be a matter of construction and thus depend on the wording of the particular clauses in question and the factual matrix as at the date of the charterparty.
The type of charterparty
Also, material to the question of the assumption of risk will be the specific type of charterparty under consideration. For example, in the context of a voyage charterparty with a sole discharge port (or even a time charter trip to a stipulated location) it will be harder (though not impossible) for an owner to argue that it has not assumed the existing risks of trading to those particular locations where such risks were known at the time of the relevant charterparty. By contrast, it may be easier for an owner under a period time charterparty for worldwide trading limits to maintain that it has not assumed the risk of trading to one particular war-affected area within those broad limits. The key point is that the charterparty trading parameters in the charterparty will be important in assessing the risk assumed by owners.
The factual matrix and the charterparty date
For purposes of considering whether owners are entitled to refuse to proceed to a certain area, the exact date of the Charterparty may be crucial. The factual matrix as at the charterparty date will be important to the question of the assumption of risk, since known risks as at the date of the charterparty are more likely to be deemed to have been assumed by owners.
Alternative situations
The position may be stated briefly as follows:
- If the charterparty does not anticipate or require that the vessel will proceed to a particular area, there will normally be no reason why owners cannot rely on the war risk clause (if otherwise applicable).
- If the charterparty anticipates that the vessel may be ordered to a particular place, it is possible (depending on its construction) that the owner will only be allowed to rely on the war risk clause (if otherwise applicable), insofar as the risks have increased since the date of the charterparty, unless the war risk clause provides that the owner can rely on the clause irrespective as to whether the risks existed at that date (such as CONWARTIME 2013 and 2025).
- If the charterparty requires the vessel to trade to a particular place (for example, by providing for a named port or by providing that such trading is "always allowed"), the owner may be prevented from relying on the clause (if otherwise applicable) unless there has been a change in the nature of the risks since the date of the charter or the risks have increased so significantly as to make them "qualitatively different"; see, The Polar [2021] UKSC 2. This might be the case if, for example, the owner agreed to trade via the Strait of Hormuz under a charterparty dated prior to the outbreak of hostilities on 28 February 2026.
Other Charterparty provisions
Safe port warranties and indemnities
If a port is affected by war, it may be possible for owners to argue that the port is legally unsafe. To make good such an argument, owners would need to show that the subject vessel would not be able to reach, use and return from the port safely in the absence of some abnormal occurrence (see The Eastern City [1958] 2 Lloyd's Rep 127).
However, as a matter of English law, it is the prospective safety of the port which is relevant: though the assessment is made when the order is given, the assessment considers the safety situation at the time the vessel will arrive at and seek to use the port. Complex questions may then arise as to whether a port was prospectively safe at the time the vessel was ordered there if there were no hostilities at that time, but such hostilities might have been anticipated.
Under a time charterparty, if the relevant port to which the vessel is ordered becomes unsafe after the order is given, charterers are under a secondary obligation to give alternative voyage instructions for the vessel to proceed to a different port which is prospectively safe. Such a secondary obligation is not considered to rest upon voyage charterers.
Although in theory a safe port warranty may be engaged by war, it may be unlikely for owners to be able to rely on the general safe port warranty to refuse to proceed to a particular place affected by war in circumstances where the specific war risks provision would not itself entitle a refusal to comply.
However, the safe port warranty may become highly relevant where the vessel sustains damage having proceeded to a war-affected port, and her owners seek to mount a claim for damages after the event.
Similarly, if the vessel is damaged as a result of complying with a time charterer's order to proceed, for instance, through the Hormuz Strait, owners may also be able to recover under an implied indemnity (for example, the indemnity implied in clause 8 of the NYPE 1946 form). Some charterparties also contain an express indemnity, such as clause 13(a) of Shelltime 4.
For an indemnity claim to succeed, however, the charterer's orders must be an "effective cause" of the owner's loss, and no indemnity will be recoverable in respect of risks that the owners are deemed to have agreed to bear under the relevant charterparty. There is generally no equivalent indemnity in a voyage charterparty.
Cancellation clauses
The relevant charterparty may provide for an entitlement to cancel the contract in the event that war affects the intended charter voyage. Many charterparties contain a mutual cancellation clause in the event of an outbreak of war between stipulated states. These, however, tend to list countries such as the US, UK, China, France, Japan and Russia as belligerents, whereas the above conflicts do not involve overt conflict between such states.
It is important to review the cancellation clause carefully, as it may permit cancellation if a specified country becomes involved in a war.
It is also possible that war may, for instance, delay delivery under a period time charterparty, in which case, it is possible that the vessel may miss the laycan and thus trigger the entitlement to cancel.
Force Majeure
Many voyage charterparties (in particular) will also include a force majeure provision which may, for instance, discharge the parties from their contractual obligations (and liabilities) if performance is prevented (or hindered) by a stipulated force majeure event. The extent of the protection such a clause would provide to the parties would be a matter of construction, depending entirely on the wording of the particular provision, and the extent to which contractual performance has, in fact, been prevented.
Sanctions clauses
The current geopolitical situation also gives rise to sanctions concerns. In this regard, most current charterparties are likely to contain sanctions provisions such as the BIMCO Sanctions Clause for Time Charter Parties 2020. The latter clause allocates responsibility for sanctions compliance between owners and charterers by allowing either party to refuse orders or performance that would expose them, the vessel, cargo or associated persons to sanctions imposed by applicable authorities. It also provides the right to suspend performance or terminate the charter in certain circumstances, with the aim of protecting both parties from legal, financial and operational risks arising from international sanctions regimes.
The Persian Gulf Strait Authority is sanctioned (in addition to a number of other state-related players), and OFAC has made it clear that obtaining a safe passage guarantee from the Authority, even when no money changes hands, may constitute sanctionable conduct. US policy position: Iran's attempts to monetise Hormuz transits — whether through direct IRGC-linked tolls, the PGSA's "permission" regime, or nominally private insurance schemes like PGMIC and HormuzSafe — are being met with active sanctions designations, and any payment, in-kind exchange, or even mere receipt of "safe passage" services from Iran or the IRGC carries sanctions risk for both U.S. and non-U.S. persons.
Any transit through Hormuz, as per OFAC guidance, requires additional due diligence measures to ensure no sanctions are being breached. When you are aware of the transit, please advise immediately your usual Claims Executive who will guide you with respect to actions required before the Association can confirm cover, or handle any claim.
The sanctions landscape has become increasingly complex this year.
On 13 April 2026, China introduced the Regulation on Countering Foreign Undue Extraterritorial Jurisdiction (Regulation 835). The Regulation strengthened China's ability to respond to foreign "long-arm jurisdiction" measures. It builds on anti-blocking measures introduced five years ago by providing additional enforcement tools and procedural guidance.
Because sanctions rules may conflict, Members should review their sanctions clauses. They should also carry out additional due diligence and remain alert to changes in the sanction's environment.
Crew War Bonus Clauses
Some standard War Risk Clauses, e.g. Conwartime 2013, require Charterers to reimburse Owners for any war bonuses that Owners are obliged to pay their crew under the crew employment contracts for entering war / high risk areas. However, we have seen a number of bespoke clauses, particularly from oil majors, where Charterers are required to be given notice in writing as to the amount of the bonus. We remind parties to check carefully the provisions of any such bespoke clauses.
Frustration
If vessels are unable to proceed safely for a prolonged period of time (for instance, because they are 'trapped' in the Persian Gulf) and the governing charterparty clauses do not adequately address the situation, the contract may be frustrated. A charterparty, like any other contract, may become frustrated if, without fault of either party, a change of circumstances makes the performance of remaining contractual obligations so "radically different" from that which was reasonably contemplated at the execution of the contract that it would be unjust to hold the parties to those obligations. Frustration occurs automatically and is not dependent on the parties making any election. Complex questions may then arise where the parties tender some form of performance after the contract has been frustrated to the benefit of the other party.
It should be noted that a charterparty will not be frustrated simply because performance has become more costly or has been significantly delayed; the changed circumstances (including likely future delay) must make performance "radically different". Any assessment of whether the new circumstances are so radically different as to frustrate the contract will inevitably involve reference to the contract terms (in particular relating to remaining obligations) and to the circumstances of the case.
Cargo and Bills of Lading
It is important not to consider the charterparty position in isolation. Also relevant to the steps owners may wish to take are whether the vessel is laden with cargo and the particular characteristics of that cargo. An obvious consideration is whether the cargo is perishable or not.
It is also probable that owners will have assumed obligations to cargo interests under any bills of lading issued in respect of cargo loaded under the charterparty and potentially in bailment. Such obligations will generally include discharge at the stipulated discharge port and taking reasonable care of the loaded cargo. It will be important to consider whether the relevant bill of lading gives owners similar rights to refuse to proceed to a particular location, for instance, by incorporating the war risks clause of the subject charterparty. Owners should consider a clause requiring any bills of lading issued under the charterparty to incorporate similar protections enjoyed by owners under the charterparty.
It will also be important for owners to consider how (and when) freight is earned under the relevant bills of lading.
Five practical steps moving forward ...
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Safety First!
The safety of the vessel and her crew is paramount.
Quite apart from any applicable war risks provision, the vessel is not obliged to proceed to or remain at any place where she will face imminent peril.
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Carefully review the charterparty terms
A comprehensive review of the entire charterparty terms is crucial. The war risks clause itself is of course important, but will often only provide part of the answer when it comes to owners’ obligations to proceed to a particular area.
Furthermore, should owners elect to refuse orders in reliance on one of the BIMCO standard war clauses, it is important to note that many of the owners' entitlements under such provisions are contingent on the provision of minimum amounts of notice to charterers. Where these apply, it is important that such notice requirements are complied with strictly.
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Take the time necessary to assess the risk
It should be emphasised that owners are not obliged to comply with any order from a charterer immediately and without pause for thought: owners are entitled to a reasonable period of time to consider the relevant order given and its legitimacy.
The reasonable period of time afforded to owners should be used, wherever possible, to gather evidence and to conduct an appropriate voyage-specific risk assessment for the relevant vessel, so as to make as informed a decision as possible as to whether or not it is safe to comply with instructions. It may sometimes be sensible to obtain risk assessment from a professional expert.
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Co-operation and agreement wherever possible
Owners and charterers are normally under an implied duty to cooperate with each other as far as the safe and effective prosecution of the voyage is concerned. In this regard, communication lines should always be kept open, and the parties should cooperate to the fullest extent possible to see if solutions can be reached to mitigate any risks to the vessel or her crew. However, consideration should always be given to preserving recovery prospects if the vessel is substantially delayed. Owners should be cautious about permitting lengthy delays during which discussions take place, if it is unclear whether they can recover in respect of the consequences for doing so. This may be more of an issue under a voyage charterparty than a time charterparty.
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Bespoke clauses
In respect of new charterparties pursuant to which it is anticipated that the vessel may or will proceed via a war-affected area, owners and charterers should consider whether an additional charterparty provision is needed to safeguard or strengthen their respective positions and to avoid some of the uncertainties with the current suite of standard war risks provisions.
Just as importantly, however, owners should be wary, at the fixture negotiation stage, of agreeing to a provision which effectively compels them to proceed to a war-affected area, notwithstanding the war risks clause.
If there are any doubts as to how to proceed, Members are advised to contact their usual Claims Executive for assistance.
Acknowledgements
Skuld is grateful to Robert Veal and Glenn Winter: Winter & Co Solicitors.