COVID-19's Lingering Impact: Recent legal Decisions

As COVID-19 cases reportedly rise in many countries, two recent legal decisions are particularly significant for the shipping industry. The first, The Sagar Ratan [2025], clarifies aspects of the BIMCO Infectious or Contagious Diseases Clause. The second, London Arbitration 8/25, addresses whether COVID PCR certificates are necessary to deem a vessel ‘in every way fitted for the service’.

In the first case, some crew tested positive for COVID-19 upon arrival in Bayuquan. To avoid quarantine, Owners diverted the ship to S.Korea, for crew change before returning to Bayuquan to complete discharge. Charterers then deducted two weeks of hire and expenses for the delay. The core dispute centered on whether this delay was caused by calling an "Affected Area" as defined in the BIMCO Infectious and Contagious Diseases Clause (defined as “…a port or place where there is……a risk of quarantine or other restrictions being imposed in connection with the Disease). The UK High Court ruled the delay stemmed from the vessel/crew's characteristics, not the port itself, concluding Bayuquan was not an "Affected Area", hereby allowing charter’s claim. The court also clarified that a port is an Affected Area if it generally imposes quarantine or restrictions on incoming vessels due to a disease, or on specific categories of vessels (e.g., those from certain prior destinations).

In the second case, the vessel was denied entry to Nanjing port because some of the crew members, who had joined at the last port (Busan), lacked valid PCR certificates. Nanjing's local requirements stipulated these certificates had to be obtained within three days of joining. Vessel sailed back to Busan for testing, delaying its berthing by nearly two weeks. Charterers sought approximately USD 300,000. Owners contended it was the charterers' duty to inform them of such regulations. Tribunal found the owners at fault for not being aware of Nanjing's well-established port requirements. This failure triggered the charterparty's broad "any other cause preventing the full working of the vessel" leading to the charterers' claim being granted in full.

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Link to the first case: https://www.bailii.org/cgi-bin/format.cgi?doc=/ew/cases/EWHC/Admlty/2025/193.html&query=(%22sagar)+AND+(ratan%22)

Link to the second case: https://www.i-law.com/ilaw/doc/view.htm?id=447860