Policy & Compliance
Implications of the Gulf war for your contracts
An update on the contractual considerations stemming from the current con fl ict in the Middle East
T he current con fl ict in parts of the Middle East continues to present a complex and uncertain backdrop for maritime and port operations, with the potential for rapid change. Shipping lines, ports and freight forwarders fi nd themselves navigating a range of operational, contractual, safety and liability challenges arising from broader geopolitical circumstances beyond their control. This guidance is intended to assist Members in understanding the key risk considerations and risk mitigation steps to take in the current situation. This document covers relatively dry commercial and procedural issues, but the human cost to seafarers, shore-based personnel and the wider civilian population must be considered. Contractual implications The ongoing conflict is likely to give rise to contractual issues; shipping lines are having to make difficult decisions in a changing situation over which they have no control. We are seeing ships diverted, trapped in the Arabian Gulf, the main conflict zone, or in some cases offloading cargo at ports other than the intended final destination. In all cases they will be relying on the clauses contained within international conventions or their own trading conditions. BIFA Members trading under either the 2021 or 2025 edition of the BIFA Standard Trading Conditions (STC), where incorporated in the forwarding contracts with clients, have levers with which to protect themselves whether acting as agent or principal. All guidance in this document is given on the basis of the 2025 edition, which is the current edition. Clauses 4, 5 and 6 are often overlooked but, in the current situation, are important. They state that the Member, dependent on circumstance, can act as either agent or principal. However, in general terms the Member has the liberty to contract on “any terms whatsoever” for all or part of the
service. Effectively this is a contractual chain, between the Member and its customer: the customer permits the Member to then contract on its behalf with the carrier on its (the carrier’s) terms or the relevant international convention. Current crisis In this situation, disruption and delays are inevitable. In addition, the slow return of vessels using the Red Sea/Suez Canal transit seems to have halted, with vessels diverting back to using the Cape of Good Hope. Given the mixed destinations for cargo on board a particular vessel, some delay is to be anticipated as alternative berths are found to offload cargo destined for ports either closed or under threat. Key points for consideration • Review and, where necessary, strengthen procedures to incorporate the BIFA STC in all forwarding contracts. • Ensure that you familiarise yourselves with key clauses (covered below). • Avoid offering firm guarantees or inflexible service delivery commitments during periods that may be affected by rapidly evolving geopolitical developments. • Potentially remind buyers and sellers that losses arising from war-related events, such as delays to
“ Shipping lines are having to make difficult
decisions in a changing situation over which they have no control
14 | April 2026
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