Liquidated damages in draft Gencon clauses

Avoidance of disputes and a purposive coverage are two important aims of the standardised provisions of uniform contracts. Gencon, code named “Uniform General Charter”, is a BIMCO-recommended charterparty and a standard form contract for dry cargo voyage charters. Gencon was issued in 1922, revised in 1976 and later in 1994. The BIMCO Documentary Committee has been working in a concerted manner to finalise and launch the new Gencon within 2021.

Under Gencon 1994, when the charterer commits a repudiatory breach by wrongfully terminating the charterparty before the commencement of loading, it can sometimes lead to a complicated procedure and potentially an unfair outcome for the shipowner. There is no liquidated damages clause included in Gencon 1994; however the consultation draft of Gencon 2020 which was released in February 2020 contains a “Prevention of Performance” clause that also serves for a fair premature termination of the contract.