Originally from The MENA Leading Arbitrators’ Guide to International Arbitration

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I. WHAT IS MARITIME ARBITRATION?

Shipping disputes tend to subdivide into wet shipping (or Admiralty) matters on the one hand and dry shipping matters, on the other hand. The former include ship groundings, collisions, sinkings and the latter encompass mainly contractual disputes involving the cradle to grave of shipping—from shipbuilding contracts (at the beginning of the ship’s life) to ship scrapping contracts, at the end. In between there are matters such as charterparty and bill of lading issues relating to the hire of the ship between shipowner and charterer and issues relating to the carriage of goods between the cargo interests and the carrier (be it the carrier the shipowner or the charterer). Also included would be related marine insurance disputes and, of particular significance in the Middle East, disputes involving the off-shore energy sector, which often have a marine aspect.

A dictionary definition of “maritime” is “connected with the sea”, so it touches all endeavours involving off-shore rigs and accommodation units, subsea and floating pipelines, off-shore wind farms and other off-shore power generation devices, and construction and operation of ports and terminals. Yacht and barge construction, use and refurbishment are also maritime activities and there have been many famous maritime boundary disputes.

Over 90% of world trade moves by sea and continues to expand, bringing benefits for consumers across the world through competitive freight costs. Thanks to the growing efficiency of shipping as a mode of transport and increased economic liberalisation, the prospects for the industry’s further growth continue to be strong.

There are over 50,000 merchant ships trading internationally, transporting every kind of cargo. The world fleet is registered in over 150 nations, and manned by over one million seafarers of virtually every nationality.

Ships are technically sophisticated, high-value assets, (larger hi-tech vessels can cost over US $200 million to build), and the operation of merchant ships generates an estimated annual income of over half a trillion U.S. dollars in freight rates.