Israel-Iran war raised concerns over safe port warranties

THE Israel-Iran war drove shipowners and charterers to check their safe port and berth warranties in the Middle East, according to law firm Reed Smith.

Such warranties in charterparties give the shipowner comfort their vessel won’t be exposed to danger when berthing in the place where the charterer wants to load or discharge cargo.

“Clients are asking how exposed they are and whether their contracts offer real protection,” Reed Smith partner Nick Austin said.

“Even with the current Iran-Israel ceasefire, the industry knows just how fragile the situation is and how quickly it could change.

“This is one of the key legal issues we are advising on at the moment.”

Israel and the US bombed Iran last week, with Iran firing missiles back at Israel and a US air base in Qatar. US President Donald Trump announced a ceasefire on June 24.

Austin said safe-berth warranties were a central part of the bargain between owners and charterers in many charterparties.

A breach of the obligation means owners can claim damages from the charterer for any losses incurred, such as damage to the vessel because the port was dangerously shallow, or because there were unmarked rocks or obstructions the master could not have avoided with good seamanship.

Austin said oil exporters in the region may have promised the safety of load ports or berths in their sale contracts. But he said the level of protection from such warranties varied.

“Depending on how they are worded, they may only apply to the safety of the berth and not cover any danger or attack on the approach,” he said.

“In English law, safety is usually judged at the time of the order to go to the specific port. It may not cover the port becoming unsafe later on.

“But if the port does become unsafe, charterers may have to nominate another safe port.”

Austin warned that these warranties did not give shipowners a blank cheque if their vessel was damaged by the port being unsafe. Charterers could argue the damage was the shipowner’s fault if the particular damage could have been avoided by good navigation and seamanship, he added.

There might be arguments over exactly what “good” navigation or seamanship meant in each case.

“Charterers may be able to defend safe-port claims if they can show that the danger was caused by an abnormal occurrence with no connection to the characteristics of the port,” Austin said.

The so-called “12-day war” between Israel and Iran had little visible impact on shipping, with ships still trading and Iran’s oil output projected to increase.

Lloyd's List Daily Briefing 02 July 2025

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