A Complex Brew of Issues Fuels Law Firm Growth
Late in January, the International Chamber of Shipping (ICS) published its annual Shipping Industry Flag State Performance Table, a timely and graphic illustration of the challenges of compliance: either the rules are specific and universal but need constant reinterpretation, or they are general or not widely accepted and so enforcement becomes a challenge.
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In terms of the basic blocking and tackling of project cargo, Tom Belknap, partner, co-chair of maritime practice at US-based Blank Rome, said that his firm has been handling a few cases of lost or damaged goods, including one involving oil drilling equipment. He could not give more specific details but said, “we have recently been involved in several claims involving project cargo that went over the side or was damaged in transit. There have actually been a few lately; project cargo is usually well secured. The legal questions mostly revolve around the definition of a package in maritime and contractual law.”
Contentious market
Belknap works in the New York office, “where things tend to be more contentious” than in other parts of the maritime sector, he noted. “Overall, our maritime practice is more of an industry group than a legal discipline. It includes tax, mergers and acquisitions, labour and bankruptcy law, as well as the regulatory, insurance and contract law that would be expected.” Blank Rome has more than a dozen offices around the USA as well as one in Shanghai.
An important and growing body of work involves offshore wind energy. “A lot of the power purchase agreements (PPA) that were negotiated when large projects were planned for the US East Coast are now four years old or more,” Belknap said. “The economics of both building those projects, as well as operating them, have fundamentally changed.”
Inflation has been a major factor, he explained, but so have supply chain issues, personnel and financing. A few projects have been cancelled and a few others delayed, but in most cases the PPAs and contracts are simply being renegotiated in light of present realities. Most are being done collaboratively, but Belknap acknowledged that “as time goes by, skills in contentious actions will come in handy.”
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Barge concept
“The barge concept shows how things can be done in ways that are compliant” with the Jones Act, said Jeanne Grasso, partner and co-chair of maritime practice at Blank Rome, “even though it may not be the most efficient. The shuttle concept is also realistic, because Jones Act ‘waivers’ are not realistic.”
Grasso focuses on compliance and regulatory issues, including work with Customs authorities, the US Coast Guard, and the Environmental Protection Agency in support of compliance and in defense of alleged violations. She came to that as a biologist who had worked in Washington DC on maritime and fisheries issues.
There has also been something of a salubrious effect on port authorities and other government officials in the coastal jurisdictions. “Some state officials have been very creative in configuring their development plans around Jones Act compliance,” said Grasso. “The CBP has issued rulings that have had a major impact on how wind turbine components and other cargoes are being staged.”
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"A Complex Brew of Issues Fuels Law Firm Growth," was published in the March/April issue of Heavy Lift Project Forwarding International magazine.