Originally from Navigating Maritime Arbitration: The Experts Speak - Second Edition

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I. INTRODUCTION

In most jurisdictions, shipbuilding disputes are commonly referred to maritime arbitration, even though shipbuilding contracts are not—or not only—maritime contracts.

In the United States, “a contract to repair, or to insure a ship, is maritime, but a contract to build a ship is not.”  Shipbuilding contracts are thus neither subject to admiralty jurisdiction, nor governed by the federal maritime law.  Instead, shipbuilding contracts are assimilated to contracts for the sale of goods, subject to Article 2 of the Uniform Commercial Code (UCC) in most states.  In the United Kingdom, “a contract to build a ship, though a contract for the sale of goods, [has] some characteristics of a building contract.”  Both sales law and construction law principles thus apply to shipbuilding contracts, which are nonetheless subject to admiralty jurisdiction under a British statute.  In civil law countries, shipbuilding contracts are also an original category, because they resemble construction contracts, but borrow some characteristics from contracts for the sale of goods. 

The difficult categorization of shipbuilding contracts has led to their exclusion from the scope of the Convention for the International Sale of Goods (CISG), as explained in its commentary:

In some legal systems the sale of ships, vessels and aircraft are sales of “goods” while in other legal systems some sales of ships, vessels and aircraft are assimilated to sales of immovables. Furthermore, in most legal systems at least some ships, vessels and aircraft are subject to special registration requirements. The rules specifying which ones must be registered differ widely.