2016 York Antwerp Rules
Introduction
The Communiqué on the 2016 York Antwerp Rules was entered into force through publication in the Official Gazette dated 19 February 2019 and numbered 30691. The York Antwerp Rules set out the principles of the “general average” for the equitable allocation of sacrifices made in case of a sudden threat in maritime travel. The general average is defined as sharing the damages and costs that are the result of loss suffered in order to save a ship and her cargo from danger in the event of abnormal danger faced by the ship and cargo in the course of maritime travel.
The general average is firstly regulated by national laws. The fact that the parties related to transportation in maritime transports (persons related to the cargo and ship) generally have different nationalities, and the differences between national laws has revealed the need to create a uniform body of rules as to general averages. As a result of the works initiated by the International Law Association towards the end of the 19th century, the rules that define the principles and scope of general averages is called the York Antwerp Rules. The York Antwerp Rules are renewed periodically by the International Maritime Committee (“IMC”) according to the requirements of international trade and current issues. As a result of the changes made in 2016, the Rules became the most recent version, as recommended.
The York Antwerp Rules do not have the characteristics of an international contract; they are similar to advisory rules that may be added as a term in the freight contract or bill of lading pursuant to the will of parties concerning maritime transport. In practice, the parties usually implement the York Antwerp Rules by specifying the date (2014, 2016) instead of codes for the contract and bill of lading[1].
Implementation of York Antwerp Rules
The provisions concerning general averages in Turkish Law are regulated between Articles 1272 and 1285 of the Turkish Commercial Code (“TCC”). Pursuant to Article 1273 of the TCC, “In the event that parties agree otherwise, general average pro rata is subject to the rule of the last version of the York Antwerp Rules prepared by International Marine Committee and translated into Turkish and published in accordance with this Article.”
In this respect, the legislator adopts the freedom of contract to decide which rules to be applied to general averages, and leaves the rules to be applied to the will of the parties. Therefore, the parties may decide which text of the York Antwerp Rules will be applied (1996, 2004, etc.) as they see fit. However, in cases where the parties do not make any agreement regarding this issue, and Turkish Law is applied, Article 1273 of the TCC shall govern. In accordance with the relevant regulation, in the case of general averages, unless the parties agree otherwise, the most recent York Antwerp Rules, as published in the Official Gazette, shall apply.
The legislator refrained from codifying the Rules, taking into consideration that the York Antwerp Rules have been renewed, periodically. Thus, the most recent Rules, which are accepted by the IMC regarding general averages, and entered into force through publication in the Official Gazette, shall be applied without any necessity to change the TCC.
General Averages Pursuant to York Antwerp Rules
The conditions in which the general average emerges; in other words, the types of general averages, are regulated in the numbered rules of the York Antwerp Rules (Rule I - XXIII). The lettered rules indicated between A - G regulate the general principles of general averages. Unless an exception is provided for, the general principles set out in the lettered rule shall also apply to numbered rules.[2]
The Rule of Interpretation and Rule of Paramount have been set forth in the preamble of the York Antwerp Rules. In accordance with the Rule of Interpretation, in the adjustment of general averages, the lettered and numbered Rules shall be applied irrespective of any law or practice inconsistent therewith. Except as provided by the Rule Paramount and the numbered Rules, general averages shall be adjusted according to the lettered Rules. In this respect, when the parties decide on the implementation of the York Antwerp Rules, it is accepted that these rules shall supersede national laws.
As per the Rule Paramount, in no case shall there be any allowance for sacrifice or expenditure unless reasonably made or incurred.
Conditions of General Average
There is a general average act when; (i) a ship is partially or fully loaded; (ii) the ship and the cargo have encountered a common peril; (iii) any extraordinary sacrifice or expenditure is made for the purpose of preservation from the peril; (iv) the sacrifice is reasonable and made voluntarily, and (v) the sacrifice results in a beneficial outcome; in other words, the ship or the cargo result in being partially or completely preserved[3]. The sharing of expenditures in the general average system is made between the parties who benefit from the rescue of the ship and the cargo.
Major General Average Types
- Jettison of Cargo
The cases of jettisoned cargo in order to eliminate a common peril shall be allowed as a general average. Loss of or damage to the property by water which enters a ship’s hatches that have been opened, or other opening has been made for the purpose of making a jettison for common safety, shall be allowed as a general average. On the other hand, no jettison of cargo shall be allowed as a general average, unless such cargo is carried in accordance with the recognized custom of the trade.
- Extinguishing Fire
Damage by fire constitutes a particular average and it is not allocated[4]. However, the consequent loss or damage to a ship and cargo that arose from extinguishing a fire on board shall be allowed as a general average.
- Voluntary Stranding
When a ship is intentionally run on shore for common safety purposes, the consequent loss to or damage on the ship and its property shall be allowed as general averages.
- Salvage Remuneration
Expenditures incurred by the parties for common expenses that are in the nature of salvage, whether under contract or otherwise, shall be allowed in general averages, provided that the salvage operations were carried out for the purpose of preserving from peril the property involved in the common maritime adventure, and are subject to the provisions of the Rule numbered VI.
- Lightening Expenses and Consequent Damage
When a ship is ashore, and the cargo and ship’s fuel and stores for any of them are discharged as a general averages act, the extra cost of lightening, lighter hire and reshipping (if incurred), and the loss and damage to the property involved in the common expenses in consequence thereof, shall be allowed as general averages.
- Expenses at Port of Refuge
The general average of entering a port of refugee is one of the most common and most important types of general average[5]. When a ship has entered a port or place of refuge, or shall have returned to her port or place of loading in consequence of accident, sacrifice, or other extraordinary circumstances that render these actions necessary for common safety, the expenses incurred for entering such port or place shall be admitted as general averages.
In this respect, expenses for entry to the port of refugee, costs of discharging cargo, fuel or stores or overhauling them in the ship, re-stowage costs of the cargo, etc., are qualifying conditions of costs for as general averages, and are regulated in detail in Rule X.
Conclusion
The Communiqué on the 2016 York Antwerp Rules that regulates the general principles and types of general averages, was entered into force through publication in the Official Gazette dated 19 February 2019. Therefore, pursuant to Article 1273 of the TCC, the York Antwerp Rules dated 2016 are applicable in cases where the parties do not make an agreement as to general averages in freight contracts or bills of lading, and the dispute is subject to Turkish Law.
[1] Kender / Çetingil / Yazıcıoğlu, “Deniz Ticaret Hukuku Temel Bilgiler Cilt 1”, XII Levha, 13. Edition, Istanbul, October, 2012, p. 239.
[2] Kender / Çetingil / Yazıcıoğlu, p. 244.
[3] Kender / Çetingil / Yazıcıoğlu, p. 243.
[4] Kender / Çetingil / Yazıcıoğlu, p. 246.
[5] Çetingil / Kender / Ünan, “Müşterek Avarya Hukuku”, XII Levha, 1. Edition, İstanbul, May, 2011, p. 186.
All rights of this article are reserved. This article may not be used, reproduced, copied, published, distributed, or otherwise disseminated without quotation or Erdem & Erdem Law Firm's written consent. Any content created without citing the resource or Erdem & Erdem Law Firm’s written consent is regularly tracked, and legal action will be taken in case of violation.
Other Contents
The Turkish automobile and light commercial vehicle market left the 2000s behind with steadily rising sales figures and the 2010s with high and stable sales figures as well. In this period, the growth of the market was driven not only by high purchase power but also by easy access to credit and product diversity...
Turkish Commercial Code No. 6102 ("TCC") provides the right to exit from the company to the shareholders of limited liability companies and the right to squeeze out the shareholder from the company, unlike the structure of joint stock companies, with the exit and squeeze out institutions specially regulated for...
Turkish Commercial Code No. 6102 (“TCC”) preserves the rule that the board of directors shall manage and represent joint stock companies. The TCC regulates how the power of representation shall be exercised, the registration and announcement of the persons authorized to represent, the transfer of the...
Ordinary partnerships are regulated under Turkish Law between Articles 620 and 645 of the Turkish Code of Obligations No. 6098 (“TCO” or the “Code”). The Law defines an ordinary partnership contract as a contract where two or more persons undertake to combine their labour or property to achieve a common...
Merger and acquisition processes are one of the legal processes that most seriously affect the identities and legal status of companies. After the completion of legal, tax, financial and operational due diligence reports, the parties initiate the negotiation process in case they reach an agreement on proceeding with the...
A popular business model for expanding market reach and brand recognition worldwide is franchising. Despite being less common than distribution agreements in the form of mono-brand store agreements, franchising is another significant method for extending luxury brands' distribution networks. Luxury brands use...
In the decision dated 14.06.2022 and numbered 2019/149 E. 2022/894 K., the Court of Cassation General Assembly (“CCGA”) evaluated the theory of piercing the corporate veil in the context of the relationship between the guarantor and the borrowing company in a dispute arising from a loan agreement...
The European Union continues to be an important investment center for foreign investors. According to data from the European Commission's "Second Annual Report on the monitoring of foreign direct investment in the European Union", the European Union received €117 billion worth of foreign direct investment in...
Transfer of shares is arguably the first legal transaction that comes to mind among the legal transactions regarding the shares of a capital company, and the most common transaction in practice. However, the shares of a capital company may also be subject to various transactions, other than share purchase...
Law No. 6563 on the Regulation of Electronic Commerce (E-commerce Law or Law) has recently undergone a radical change in order to regulate the behavior of the players in the rapidly growing and developing e-commerce sector. The new regulations that came into force as of January 1, 2023 envisage important...
On 11 June 2021, the German Federal Parliament approved the German Supply Chain Due Diligence Act (Lieferkettensorgfaltsgesetz) (“Act”) which affects not only German entities but also their suppliers in foreign countries (including Turkish entities). The main focus of the Act, which entered into force on...
On 21 December 2007, the Federal Council approved the draft revision of the Swiss Code of Obligations, which also includes amendments to company law. On 28 November 2014, the Federal Council referred the draft revision for consultation. Following extensive discussions and a long enactment process, the...
The Turkish Commercial Code No. 6102 ("TCC") regulates maritime trade contracts under the fourth part of the fifth book of the Code. Among the types of contracts regulated in this section, the most frequently used contract in international maritime transport practice is the freight contract regulated under...
Prohibition on hidden income shifting is one of the most important issues that is broadly regulated under Capital Markets Law No. 6362 (“CML”). In conjunction with CML Article 21, which has a broader context than Article 15 of the abrogated Capital Markets Law No. 2499, another significant step has been taken...
As a result of developing commercial activities and large-scale investments, especially concluded in the fields of construction, energy and mining, companies are seeking to participate in these investments by uniting their powers and expertise to take advantage of financial opportunities together. This tendency...
The Turkish Commercial Code (“TCC” or “Law”) has enabled companies to apply different structural models and to implement new legal formations by including spin-off provisions to its Article 159 et seq. In accordance with the provisions of the law, companies may transfer a certain element, or elements, of their...
The International Federation of Consulting Engineers is a professional association established in 1913, known as the FIDIC (Fédération Internationale Des Ingénieurs-Counseils). Its members are duly elected from consultant-engineer associations of various countries, and membership to the association is...
Incoterms are a set of rules introduced by the International Chamber of Commerce (ICC) to explain the commercial terms that are widely used in international trade. The purpose of Incoterms rules is to facilitate and expedite international trade in a safe and secure manner...
The regulation applicable to all Turkish ports prepared by the Ministry of Transport, Maritime Affairs and Communications that entered into force after being published in the official gazette on October 31, 2012 (˝the Regulation˝), consolidates all the bylaws, regulations and instructions in a single Regulation...
As a rule, rights and obligations arising from an agreement have legal consequences only between the creditor and the debtor which are parties to the agreement. This principle is referred to as "privity of contract." In general, contracts for the benefit of third parties, where the fulfillment of an...
The rules of e-commerce, which grow and develop with the digitalizing world, are changing. E-commerce has become the driving force of the digital economy. However, considering the growth rate of e-commerce and the transformation it has undergone in a short time, it is obvious that some...
The dissolution of a company is a specific type of dissolution, which results in the cancellation of the legal personality which was gained by registration at incorporation. The specific proceeding which leads to the dissolution, and thus, the termination of a company upon the constitutive decision...
Companies in which shares or authority to manage is held by members of a family are considered to be “family businesses”. Family members can hold shares that control the company, as well as retain management authority. Having a family business means opportunity, security and income for...
Turkey ratified the Convention on the Contract for International Carriage of Goods by Road (“CMR”) in accordance with Act No. 3939 dated 7 December 1993, and the CMR entered into force in Turkey on 31 October 1995. In accordance with Article 1 / 1 of the CMR, the carriage of goods by road...
Ordinary partnerships are governed by Article 620 et seq. of the Turkish Code of Obligations No. 6098 (“TCO”). An ordinary partnership agreement is defined as an agreement whereby two or more persons undertake to join efforts and/or goods to reach a common goal...
The concept of disguised profit transfer in joint stock companies, in its broadest meaning, covers the transfer of company assets to related parties and may occur in different ways. This concept is regulated in detail under capital markets legislation...
Share subscription agreements, which are commonly encountered in start-up investments, set out the terms and conditions of an investor’s participation in a company as a shareholder by subscribing the new shares issued in a capital increase...
The electronic signature, which has the same legal consequences as wet signatures if it meets certain conditions, has taken its place in many legal systems and has enhanced commercial life. Although there are various types and applications in different legal systems...
INCOTERMS are a set of rules introduced by the International Chamber of Commerce (ICC) to explain the commercial terms that are widely used in international trade. The purpose of the Incoterms rules is to contribute to and facilitate the safe and swift conduct of international trade...