£±.Ship Inspection
¡¡¡¡The Association arranged 95 condition surveys in the 2006 policy year, representing an increase of 22% compared to the 78 condition surveys arranged by the Association in the previous policy year. Condition surveys were carried out on 47 ships, amongst which 16 ships were subject to a follow-up survey, 2 ships were subject to a second follow-up survey, and some were denied entry because they did not meet the Association¡¯s standards. Most of the surveys are random inspections with annual surveys for older ships and oil tankers.
¡¡¡¡The number of ship inspections increased slightly due to the increase in second-hand ships bought in by Members. Apart from the ship inspections mentioned above, 13 ships were inspected by surveyors appointed by the coinsurers directly. This shows the importance the Club attaches to the condition of entered ships, especially the condition of the older ships.
¡¡¡¡The ship inspections carried out revealed that the general condition of newly entered ships in the 2006 policy year was basically the same as the previous policy year; most of the ships were second-hand ships bought in from shipowners abroad. Many pre-entry surveys had to be carried out abroad. Owing to the limited delivery time and insufficient communication, the costs for such surveys were rather high and many items had to be left out. The subsequent follow-up surveys which had to be arranged resulted in a further increase in costs.
¡¡¡¡Attention should be drawn to the fact that some condition surveys could not be arranges and carried out successfully due to a lack of communication between the personnel in the commercial department and the maintenance department of some Member companies and the personnel onboard. Some important items and tests could be completed during the condition survey, so the ship¡¯s structure and cargo worthiness could not be validated. This resulted in strict restrictions having to be imposed when providing cover.
¡¡¡¡In addition, the general expertise of crew on some of the entered ships was not satisfactory. Some of the crew accompanied the surveyor with a rambling attitude. The management onboard was rather loose, the crew could not recognize the importance of the survey arranged by the Association. Some minor deficiencies that could have been rectified on spot were left out. The insufficient communication between the crew onboard and the personnel of the Member companies resulted in the late delivery of the results to the Members. All of these issues reduced the efficiencies of the condition surveys and resulted in the need for follow-up surveys to be arranged.
¡¡¡¡To ensure that the condition surveys may be carried out successfully, Members should arrange a reasonable time according to the ship¡¯s schedule and contact the surveyor and the Association in a timely manner. The personnel onboard should provide full assistance to the surveyor in completing important items first and should endeavor to finish all of the items on the survey.
¡¡¡¡The Association wishes to remind all of the Members to pay particular attention to the terms and conditions of cover for entered ships. If any restriction clauses have been attached to the ship¡¯s cover due to defects/deficiencies found in a condition survey, Members shall promptly arrange repair or rectification within the time scale required so as to avoid any disputes in respect of the cover.
2. Seminars
¡¡¡¡The Association held a seminar on claim handling on 28th October 2006 in Zhengzhou, Henan Province. 59 participants, including Judges, experts in Maritime Law, surveyors, lawyers from home and aboard, Members¡¯ representatives attended the seminar. The Association invited judges of maritime affairs from the Supreme Court of China, the director from the China Maritime Safety Administration, surveyors from the Chinese Classification Society, lawyers from Hongkong, specialists in Member companies and the Managers to give lectures on issues of mutual interests, such as oil pollution compensation and liability insurance, execution of maritime law, pre-entry surveys of entered ships, contingency plan for oil pollution from ships, collision, salvage, safety in navigation and claim handling of cases in Yemen and the United Arab Emirates. The participants discussed these topics in detail. The seminar provided a good opportunity for Members to exchange views and enhance the awareness of loss prevention.
3. Advisory Service
¡¡¡¡In the 2006 policy year, the Managers compiled 12 issues of Advisory Service. There were altogether 29 articles, most of which related to shipping laws and loss prevention.
¡¡¡¡In the shipping law section, the article ¡°Introduction of Tanker Oil Pollution Indemnification Agreements¡± presented in detail the background and contents of the ¡°Tanker Oil Pollution Indemnification Agreement¡± and the ¡°Small Tanker Oil Pollution Indemnification Agreement¡± which took effect on 20 February 2006. It provided the Members with a comprehensive knowledge of the developments in the international oil pollution compensation regime. The paper ¡°Law and Practice in Collision¡± observed the principles in collision law and included new judgments from the English Courts. The articles ¡°Law Application in Whether Cargo Claim Can Be Treated As Maritime Liens¡± and ¡°Brief Introduction of Cases Concerning Arrest of Sister Ship in South Africa¡± introduced some foreign precedents for the Members¡¯ reference.
¡¡¡¡In the loss prevention section, the articles ¡®Sea Areas With Severe Wind and Wave¡¯ and ¡®Safe navigation in Severe Weather¡¯ introduced, in the form of a series of lectures, a few suggestions for safety of navigation under severe weather and heavy seas. Articles such as ¡®Study of Master¡¯s actions in refloat of the vessel after grounding in narrow sea-route¡¯ and ¡®Operation manual for transportation of logs¡¯ etc., discussed in details the regulations which must be followed while passing through specific areas or carrying specific cargo. These articles are of great value to Members in enhancing safety management and reducing accidents.
¡¡¡¡In addition, 10 Loss Prevention Circulars were issued based on past accidents and typical cases.
¡¡¡¡In compliance with the resolutions of the Board, the Managers engaged in reasonable investment activities under the principle of security and efficiency during the 2006 policy year. The investment was quite successful with the return on assets of 27.07%, which was much higher than the market interest rate as well as the 5.82% return on assets in average acquired by other investors in insurance sectors in China.
¡¡¡¡According to the resolution of the Board, the subsidy of investment return in the 2006 policy year has been followed out. Members have enjoyed the real benefit brought by the investment activities of the Association.
¡¡¡¡Although investment is not the main business of the Association, the investment activities not only reduced the costs of the Members but also enhanced the capacity of risk resistance and cohesion of the Association.
¡¡¡¡During the 2006 policy year, the following activities were carried out:
¡¡¡¡£±.In order to promote the application for membership of International Group of P&I Clubs, a delegation composed by Board Directors visited 3 Clubs in North Europe. The visit provided an opportunity for the two sides to exchange their views. The visit was rather successful in deepening other Clubs knowledge of the Association.
¡¡¡¡£².The Association attended the No.91 and No. 92 Legal Committee conference of the IMO as a consultant part of the Government Delegation so to keep close contact with the government and international organization.
¡¡¡¡£³.The Association dispatched personnel to the United Arab Emirates, Yemen and Pakistan to deal with major claims and LOU issue on the spot and achieved a satisfactory result. The personnel from the Association also reviewed the ability of local Club Correspondents.
¡¡¡¡£´.Delegates from the Association visited major reinsurers in France and Germany so as to enhance the reinsurance business of the Association.
¡¡¡¡£µ.The Chinese and English version of the Club Rules and Conditions were revised and taken into effect.
¡¡¡¡£¶.The Association acquired a new office building in order to improve the working environment and enhance the Association¡¯s overall image.