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Certificate in Contracting Newbuildings

Study the full range of issues regarding shipbuilding contracts - delivered by tutored distance learning

Starts on 9th Febuary 2018

Delivered by tutored distance learning

During the course you will study the following modules:

1

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Introduction to Newbuilding, Parties, Contractual Issues and Commercial Context

On completing this module you will have an understanding of:

  • The parties involved in building a ship and their roles;
  • An outline of fundamental legal considerations relating to contracts;
  • Contractual issues common in shipbuilding;
  • The forms of shipbuilding contract in frequent use;
  • The constituent parts of the shipbuilding contract; and
  • The underlying commercial context
  • Introduction to shipbuilding contracts
  • The parties and their roles
  • Fundamental legal considerations
  • Contractual issues common in shipbuilding
  • Contract management
  • Negotiations
  • Forms of shipbuilding contracts
  • The parts of a shipbuilding contract
  • The underlying commercial context
  • Other ways of acquiring a new ship

2

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Production Processes, Procurement, Modifications and Inspection

On completing this module you will have an understanding of:

  • The extent of the builder’s production obligations;
  • The buyer’s obligations during production;
  • The processes by which the parties agree the final specification of the vessel;
  • External technical supervision;
  • The implications of changes to the vessel’s specification;
  • Sub-contracting;
  • Sea trials and acceptance or rejection; and
  • Sub-contracting
  • Understanding production – responsibility for design and function
  • Procurement of materials, equipment and approvals
  • Buyer’s supplies
  • Buyer’s agent/representative
  • Buyer’s inspection during construction and supervision
  • Modifications
  • Changes in rules and regulations
  • Inspection, sea trials and acceptance/rejection
  • Subcontracting

3

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Finance, Payments, Taxes and Funding

On completing this module you will have an understanding of:

  • How the basic price is adjusted to reflect variations in the agreement, such as modifications requested by the buyer;
  • Escalation clauses;
  • The instalment payment scheme;
  • Liquidated damages;
  • Taxes and interest;
  • Mechanisms for paying the delivery instalment; and
  • Loan finance: pre-delivery issues
  • The price
  • Contract price modifications
  • Liquidated damages
  • Payments and instalments
  • Payment mechanisms for pre-delivery instalments
  • Taxes, duties etc.
  • Interest
  • Additional items to be paid for at delivery
  • Newbuilding finance
  • Funding the delivery instalment
  • Loan finance – pre-delivery security

4

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Risk, Insurance, Delays, Termination & Builders’ Warranties

On completing this module you will have an understanding of:

  • The key differences between risk in and title to a vessel;
  • Insurance of a vessel which is in the process of being constructed and the considerations to be made by the  builder and buyer;
  • Delay;
  • Termination;
  • The position of builder and buyer in relation to defects in a vessel pre-delivery and post-delivery
  • Risk to and title in the vessel
  • Insurance
  • Delay
  • Insuring against the buyer’s investment
    • Force majeure
    • Warranty
  • Guarantee engineer
  • Exclusions from liability
  • Termination
    • Buyer
    • Builder
    • Consequences

5

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Delivery, Novation and Assignment, Public Procurement

On completion of this module you will have an understanding of:

  • The mechanical process of delivery of a vessel to a buyer;
  • The legal implications associated with delivery of a vessel, including title to and risk in the vessel;
  • The options available for transfer of rights under a shipbuilding contract; and
  • The formalities which must be complied with in order to effect a transfer
  • Delivery
    • Acceptance
    • Passing of title and risk
    • Documents on delivery and formalities
    • Timing
    • Registration
    • Ship finance requirements
    • Removal of vessel from shipyard
  • Disposing of the benefit of the shipbuilding contract
    • Novation
    • Assignment
  • Selling the vessel at delivery

6

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Guarantees and Associated Contracts; Contrasting Ship Conversion and Repair Contracts

On completing this module you will have an understanding of:

  • The reasons for a shipbuilder obtaining payment guarantees in respect of a buyer’s payment obligations;
  • The reasons for a buyer obtaining a refund guarantee from a shipbuilder’s bank in order to secure pre-delivery instalments and other monies which have already been paid;
  • The nature of refund guarantees;
  • The purpose, benefit and formalities surrounding guarantees;
  • Alternatives options when guarantees are not available, including letters of comfort;
  • Key considerations for both shipbuilder and buyer when obtaining guarantees; and
  • Legal issues surrounding the enforcement of guarantees
  • Buyer’s payment guarantees
  • Seller’s refund guarantees
  • Bank guarantees
  • Corporate guarantees
  • Individual guarantees
  • Legal issues of guarantees and banks’ requirements
  • Letters of comfort and intent
  • Contrasting newbuilding contracts with contracts for ship conversion and repair