The Chinese Maritime Code, adopted in 1992 (the former CMC), underwent its first comprehensive and systematic revision in 2025. The revised Chinese Maritime Code (the new CMC), comprising 16 chapters and 310 articles, came into force on 1 May 2026. This revision actively responds to contemporary demands such as the digitalisation of shipping, marine environmental protection and high-level opening of Chinese business to the world. Its core provisions include refining the regime governing property rights in ships and ship financing, unifying the rules governing both domestic and international maritime trade, strengthening the protection of the marine ecological environment, and adjusting the application of law in cross-border relations. This review introduces and analyses the main provisions of the new CMC.

This review also provides an analysis of second instance and retrial judgments relating to maritime and admiralty matters published by Chinese courts on China Judgments Online in 2025, judgments recommended by Chinese maritime judges and lawyers, and the 2025 National Typical Cases in Maritime Adjudication issued by the Supreme People's Court. Furthermore, this review introduces several maritime arbitration awards published by the China Maritime Arbitration Commission in 2025.

Article 8 of the new CMC introduces a new provision concerning the finance lease of ships. Paragraph 2 of this article stipulates that the lessor's title to a ship under a finance lease shall not be enforceable against a bona fide third party unless registered. This provision is consistent with the general rule set out in para 1 of this article regarding the effect of ship registration against bona fide third parties.

Paragraph 2 of article 8 further stipulates that the lessee shall pay the lease payments in accordance with the ship finance lease contract. If the lessee fails to pay the lease payments within a reasonable period after receiving a demand for payment, the lessor may claim payment of the full amount of the lease payments; alternatively, the lessor may terminate the ship finance lease contract and repossess the leased vessel. The obligation to pay lease payments in accordance with the contract is a general provision and does not introduce any new statutory rights or obligations. The second sentence concerns the legal remedies for breach of the obligation to pay rent. Although contractual remedies under a finance lease contract may be similar to these statutory remedies, it remains to be clarified by legislation or judicial practice whether these statutory remedies are mandatory where the contract provides for different remedies for breach.

The newly added para 2 of article 9 of the new CMC stipulates that holders of rights in the ship, interested parties and relevant state authorities may, in accordance with the law, enquire into the status of vessel ownership registration. Addressing practical issues regarding ship ownership enquiries, this provision clarifies the parties authorised to enquire into ship ownership registrations and, in order to protect the shipowner's right to privacy, restricts such enquiries to holders of rights in the ship, interested parties and relevant state authorities. Unlike enquiries into ship registration, article 22(2) of the Regulations of the People's Republic of China on Ship Registration stipulates that the ship registration authority shall permit the public to enquire about the registration status of ship mortgages. This differs from the entities authorised to enquire about ownership.

Article 10 of the new CMC introduces a new provision stipulating that, in the case of a ship under construction, ownership shall be determined by agreement; in the absence of an agreement or where the agreement is unclear, ownership shall vest in the shipbuilder. In shipbuilding practice, the ownership of ships under construction is usually clearly stipulated in the contract. Therefore, the provision that ownership of ships under construction vests with the shipbuilder constitutes a statutory default provision; should the parties have a different agreement regarding ownership, this must be expressly stated in the contract.

Article 17 of the former CMC stipulated that, once a ship mortgage had been established, the mortgagor could not transfer the mortgaged ship to a third party without the consent of the mortgagee. Article 17 of the new CMC has removed this restrictive provision. It now provides:

However, this provision does not clarify whether the parties to any such agreement include the mortgagee, nor does it specify how the mortgage can remain unaffected.

If the parties involved in the transfer of the mortgaged vessel include the mortgagor, the transferee of the mortgaged vessel and the mortgagee, the parties may, through a multi-party agreement, ensure that the mortgagee's interests are not affected by the transfer of the mortgaged vessel. For example, the mortgagee and the mortgagor may cancel the registration of the ship mortgage, while the mortgagee and the transferee of the mortgaged ship register a new ship mortgage. In such cases, the ship mortgage will not be affected by the transfer of the mortgaged ship.

If the parties to the transfer of the mortgaged vessel comprise only the mortgagor and the transferee of the mortgaged vessel, the interests of the mortgagee may be affected; this might be the reason why the former CMC stipulated that the mortgagor may not transfer the mortgaged vessel to another party without the consent of the mortgagee. Article 13(1) of the new CMC stipulates that the creation, amendment, transfer and termination of a ship mortgage shall be registered with the ship registration authority. Without such registration, the mortgage cannot be enforced against a bona fide third party. Article 20 of the Regulations of the People's Republic of China on Ship Registration stipulates that when a ship mortgage is created, the mortgagee and the mortgagor shall apply to the ship registration authority at the port of registry for registration of the ship mortgage. Article 38 stipulates that where there is an amendment to a ship mortgage contract, the mortgagee and the mortgagor shall proceed to the ship registration authority at the port of registry to effect the relevant amendment registration. Article 50(1) of the Measures for the Registration of Ships of the People's Republic of China provides that where there is a change in the details of a ship mortgage registration, the mortgagor and the mortgagee shall jointly apply to the ship registration authority at the port of registry for registration of the amendment, submitting supporting documents for the amended details and the relevant ship registration certificate. Consequently, if the transferee of the mortgaged vessel does not consent to the creation of a new ship mortgage following the transfer of the vessel, and the ship mortgagee is not a party to the contract for the transfer of the mortgaged vessel and is therefore unable to exercise rights against the transferee, it is highly likely that the ship mortgage will be affected.

Article 19 of the new CMC stipulates that where two or more ship mortgages are established on the same vessel, the order of priority for repayment shall be determined in accordance with the following circumstances: (1) where ship mortgages have been registered, repayment shall be made in the order in which they were registered; (2) registered ship mortgages shall take precedence over unregistered ones; (3) where a ship mortgage has not been registered, repayment shall be made in proportion to the secured claims. This provision removes the stipulation in article 19 of the former CMC that mortgages registered on the same day shall be repaid in the same order but does not introduce any new provisions. If “mortgages registered on the same day” is interpreted to mean mortgages registered at the same time, it would appear possible to infer that they are to be repaid in the same order.

Article 21 of the new CMC expands the scope of entities entitled to the maritime lien by adding ship managers to the existing list comprising shipowners, bareboat charterers and ship operators.

Article 22 of the new CMC lists the maritime claims giving rise to the maritime lien; in subpara (v), concerning claims for compensation for property damage arising from tortious acts during the operation of a ship, it excludes “claims for compensation for the loss of or damage to cargo, containers and passengers’ luggage carried on board the ship”, thereby avoiding confusion with liabilities under carriage contracts.

Paragraph 2 of article 22 of the new CMC amends the corresponding provision of the old CMC and provides:

The maritime claims specified in subpara (2) are claims for compensation for loss of life or personal injury occurring in the operation of the ship, and in subpara (5) are claims for compensation for loss of or damage to property arising from torts occurring in the operation of the ship but excluding claims for loss of or damage to cargo, containers and passengers’ baggage carried on board the same ship. Compulsory liability insurance and financial guarantees already provide adequate protection for parties who have suffered personal injury, death or property damage in the course of ship operations; within the scope of such compulsory insurance and financial guarantees, there is no need to seek compensation through the maritime lien.

Article 28 of the new CMC stipulates that the one-year limitation period for the enforcement of maritime claims by the maritime lien, such as seafarers’ wages and remuneration, shall be calculated from “the date on which the claimant leaves the ship” on which they were employed, rather than “the date on which the maritime lien arises” as provided for in the old CMC. This provision is more in line with the nature of seafarers’ professions and can effectively protect their rights and interests.

A new section 4, “Possessory Lien on Ships”, has been added to Chapter 2 of the new CMC, providing a clear legal basis for the exercise of a lien on ships. Article 30 stipulates that shipbuilders and ship repairers may retain lawful possession of a ship where the debtor has failed to pay construction or repair costs and shall be entitled to priority satisfaction from that ship. The order of priority for a ship's possessory lien is prior to a ship mortgage but subordinate to a maritime lien. Article 31 provides that, unless otherwise agreed, where the debtor still fails to fulfil its obligations after the shipbuilder or ship repairer has retained the ship for 60 days, the shipbuilder or ship repairer may either agree with the debtor to settle the debt by valuing the retained ship or may receive priority satisfaction from the proceeds of the auction or sale of the retained ship. Article 32 provides that, during the period of retention, if the ship is seized by a court and subsequently auctioned or sold, this shall not affect the right of the holder of the lien on the ship to priority repayment.

Chapter 4 of the former CMC, concerning contracts for the carriage of goods by sea, applied only to the contracts for international carriage of goods by sea and did not apply to the contracts for coastal carriage of goods between Chinese ports. Article 2 of the new CMC removes the provision stating that Chapter 4 does not apply to carriage between Chinese ports, thereby bringing coastal carriage of goods within the scope of Chapter 4 of the CMC. However, inland waterway carriage of goods remains excluded and is governed by the relevant provisions of the Chinese Civil Code.

The new CMC has refined and improved administrative provisions such as those concerning “coastal transport rights” while retaining the original framework, though no substantive changes have been made. Article 5 stipulates that maritime transport and towage between Chinese ports shall be operated by vessels that have lawfully acquired Chinese nationality, unless otherwise provided for by laws or administrative regulations. Without the lawful approval of the competent transport authority of the State Council, foreign-flagged vessels shall not operate maritime transport or towage between Chinese ports.

Article 43 of the new CMC brings domestic carriage of goods between Chinese ports within the scope of Chapter 4 of the new CMC. With regard to coastal carriage of goods, a “minimal dual-track system” has been adopted, whereby the rules governing international carriage of goods generally apply, but distinct provisions are made concerning the duty of seaworthiness and certain grounds for exemption from liability. Article 48(2) of the new CMC stipulates that the time frame for the carrier's duty of seaworthiness in domestic maritime cargo transport shall include not only the period before and at the beginning of the voyage, but also the duration of the voyage. Article 52(2) of the new CMC provides that domestic carriers may not be exempt from liability for loss of cargo resulting from navigational negligence or fire on board.

The former CMC classified voyage charterparties under Chapter 4, “Contracts for the Carriage of Goods by Sea”, while provisions relating to time charters and bareboat charters were set out in Chapter 6, “Ship Charter Contracts”. The new CMC has moved voyage charterparties from Chapter 6 to Chapter 4, though there are no substantive changes to the content. Article 129 of the new CMC stipulates that the mandatory provisions in Chapter 4 concerning the duty of seaworthiness and the prohibition on unreasonable deviation shall continue to apply to the charterer under a voyage charter; where a voyage charter makes no provision to the contrary, the provisions of Chapter 4 concerning the rights and obligations of the parties shall continue to apply to voyage charterparties.

Article 52 of the new CMC extends the carrier's exemption from liability to cover not only the loss or damage of goods but also cases of delay in delivery. With regard to delay in delivery, article 51 stipulates that failure to deliver the goods at the agreed port of discharge within the expressly agreed time limit constitutes a delay in delivery; in domestic carriage of goods by sea, failure to deliver the goods within a reasonable time limit also constitutes a delay in delivery. Furthermore, save where the carrier is exempt from liability in accordance with the provisions of Chapter 4, the carrier shall be liable for compensation where, due to the carrier's fault, the goods are lost, damaged or suffer other economic losses as a result of delayed delivery. It is thus evident that, while the conditions constituting delayed delivery differ slightly between domestic and international carriage of goods by sea, the basis for liability remains the same.

Article 44 of the new CMC amends the definition of an actual carrier. An actual carrier refers to an entity that, having accepted a commission or sub-commission from the carrier, actually performs all or part of the carrier's obligations relating to the carriage of goods by ship (including receipt, loading, handling, stowage, carriage, safekeeping, care, unloading and delivery). This definition broadens the scope of entities that may qualify as actual carriers. Accordingly, entities such as port operators will, when specific conditions are met, acquire the status of actual carriers and thereby be entitled to invoke the carrier's statutory defences and limitations on liability.

Under article 86 of the former CMC, the costs and risks arising from the failure to collect goods at the port of discharge were to be borne by the consignee. Article 93 of the new CMC replaces consignee with shipper and stipulates that the carrier must notify the shipper in a timely manner. Furthermore, if the consignee has already exercised rights under the contract of carriage of goods by sea, the consignee shall bear such costs and risks. This amendment clarifies the basic order of liability allocation and may reduce disputes arising from uncertainty regarding the liable party.

Article 55 of the former CMC stipulated that the amount of compensation for the loss of goods shall be calculated based on the actual value of the goods. The actual value of the goods was calculated as the value at the time of loading, plus insurance premiums and freight charges. Article 56 of the new CMC stipulates that compensation shall be calculated based on the market price at the time of delivery at the place of delivery; where these cannot be determined, it shall be calculated based on the value of the goods at the time of loading, plus insurance premiums and freight charges. This amendment brings the determination of the value of compensation for goods closer to the actual economic loss suffered, thereby reflecting the principle of compensation for damages.

The new CMC introduces a new section 5 to Chapter 4, entitled "Electronic Transport Records", confirming that electronic transport records meeting the conditions set out in laws and administrative regulations have the same legal effect as paper transport documents. China currently has no relevant laws or administrative regulations governing electronic transport records. Users of electronic transport records need to closely monitor developments in the relevant legislation to ensure that the electronic transport records they use are recognised as having equivalent legal effect under the new CMC. This section also sets out provisions regarding the reliability and exclusivity of electronic transport records, as well as the mutual conversion between electronic transport records and transport documents. These rules were formulated with reference to the United Nations Commission on International Trade Law Model Law on Electronic Transferable Records; however, the provisions in the new CMC apply not only to transferable electronic transport records but also to non-transferable electronic transport records.

The provisions of the new CMC regarding the reliability and exclusivity of electronic transport records are mandatory. The new CMC does not specify whether electronic transport records that fail to meet the requirements of reliability and exclusivity are deemed invalid or simply fail to attain the equivalent legal effect. The distinction between the two lies in the fact that the former negates the validity of electronic transport records by virtue of the mandatory nature of the law, while the latter merely means that such records cannot attain statutory validity, without negating their validity derived from the contract. The latter may be understood to mean that electronic transport records which do not satisfy the requirements of reliability and exclusivity do not fall within the scope of electronic transport records regulated by the new CMC; their validity cannot be determined under the new CMC but may still be determined in accordance with the terms of the contract. The purpose of the legislation is not to restrict freedom of contract. The latter interpretation affirms the validity of electronic transport records to a greater extent, namely both statutory equivalent validity and contractual equivalent validity.

Article 86 of the new CMC stipulates that when converting between electronic transport records and transport documents, explanatory information regarding the conversion must be provided. Once the conversion between the electronic transport record and the transport document is complete, the original transport document or electronic transport record shall immediately cease to be valid. As electronic records and transport documents have equal legal effect, this provision ensures the uniqueness of the transport document or electronic record, thereby safeguarding its exclusive nature. However, this provision does not specify the party responsible for providing the explanatory information regarding the conversion. More importantly, if such information is not provided, this implies that the conversion has not been completed, and the original transport document or electronic transport record remains valid. Nevertheless, the converted electronic transport record and transport document also has a legal effect, thereby preventing the carrier from legally and validly delivering the goods on the basis of either the transport document or the electronic transport record.

Article 87 of the new CMC sets out in detail the rules governing the carrier's delivery of goods. The specific provisions include: (1) where a straight bill of lading is issued, delivery shall be made to the named consignee against the bill of lading; (2) where an order bill of lading is issued, delivery shall be made to the endorsed assignee of the bill of lading upon presentation of the bill of lading; (3) where a bearer bill of lading is issued, or where an order bill of lading is issued with a blank endorsement, delivery shall be made to the holder of the bill of lading upon presentation of the bill of lading; (iv) where a transferable electronic transport record is issued, delivery shall be made to the holder of the electronic transport record; and (v) in other circumstances, delivery shall be made to the consignee upon presentation of the consignee's proof of identity. These delivery rules are document-based; however, no provisions are made for delivery rules in cases where a non-transferable electronic transport record (such as an electronic straight bill of lading) is issued. If the delivery rules under subpara (v) apply, the carrier may deliver the goods to the consignee upon presentation of the consignee's identification; however, electronic records and paper documents should have equal legal effect, and the delivery rules under subpara (i) should apply − that is, delivery of the goods to the named consignee against an electronic straight bill of lading − thereby ensuring the same legal effect. This issue requires clarification through judicial interpretation or judicial practice.

Article 96 of the new CMC permits the shipper to request, in writing, a change of port of discharge or consignee during the carrier's period of liability, provided that the shipper compensates the carrier for any losses incurred; it also stipulates exceptional circumstances under which the carrier may refuse such a change, including: (i) where the carrier is unable to meet the shipper's request due to objective circumstances, or where fulfilling such a request would affect the carrier's normal operations; (ii) where the carrier anticipates that complying with the shipper's request will incur additional costs or cause the carrier to suffer financial loss, and the carrier has requested the shipper to provide appropriate security, but the shipper has failed to do so; and (iii) where the shipper has failed to produce the issued transport documents as required by the carrier.

Article 176 of the former CMC provided that, in circumstances where the contract was concluded under undue influence or in a situation of danger, or where the terms of the contract are manifestly unfair, a request could be made to a court or arbitration body to modify the salvage contract. Article 185 of the new CMC provides that, in circumstances where the contract was concluded under duress or in a situation of danger, and the terms of the contract are manifestly unfair, a request may be made to “rescind or modify” the salvage contract. The addition of the remedy of rescission provides the parties with a more comprehensive means of redress where there is a fundamental defect in the formation of the salvage contract.

Article 179 of the former CMC provided that where a salvor has successfully salvaged a vessel or other property in distress, the salvor is entitled to salvage remuneration; where the salvage operation is unsuccessful, the salvor is not entitled to any salvage payment, unless otherwise provided for in article 182 (special compensation for environmental protection) of the CMC, other legislation, or the contract. Article 188 of the new CMC has deleted the phrase “or unless otherwise agreed in the contract”. A salvage contract stipulating “‘remuneration in the event of unsuccessful salvage”‘ falls within the scope of freedom of contract under the framework of the new CMC. Paragraph 3 of article 180 provides that, save as otherwise provided in article 185 of the Code concerning the revocation or amendment of salvage contracts and articles 186 and 187 concerning the prevention or mitigation of ecological and environmental damage, the other provisions of the chapter on maritime salvage shall apply only where the salvage contract contains no agreement or a different agreement. Consequently, although the rules of the chapter on salvage apply to salvage contracts, the agreements between the contracting parties take precedence over the provisions of that chapter. Article 188 on the acquisition of statutory salvage remuneration and article 189 on the determination of salvage remuneration apply only if there is no salvage agreement or the salvage agreement contains no salvage remuneration clause.

Article 115 of the new CMC harmonises the limits of liability for carriers in both domestic and international carriage of passengers, while appropriately raising the compensation limits for personal injury and death, as well as property damage. The compensation limit for personal injury or death has been adjusted from 46,666 SDR per person to 175,000 SDR per person, while the compensation limit for personal luggage has been raised from 833 SDR to 1,800 SDR; the parties are also permitted to agree in writing on higher liability limits. This amendment harmonises the compensation standards for domestic and international passenger transport and, by substantially raising the compensation limits and permitting the agreement of higher liability limits, strengthens the protection of passengers’ rights and interests.

Article 125 of the new CMC introduces a new provision on compulsory liability insurance, requiring the carrier or actual carrier to take out passenger personal injury and death liability insurance or provide a financial guarantee. The introduction of the compulsory liability insurance system provides reliable financial safeguards for compensation in the event of passenger personal injury or death and enhances the enforceability of passengers’ rights to claim compensation. However, this provision does not specify the legal liability for breaching this compulsory obligation. This awaits clarification through further legal regulations.

Article 126 of the new CMC provides that passengers may make claims directly against the insurer or the financial guarantor. This provision simplifies the claims procedure and effectively safeguards the legitimate rights and interests of passengers. Furthermore, where the carrier or actual carrier forfeits the right to limit liability as provided for in Chapter 5, this does not affect the right of its liability insurer or financial guarantor to invoke the provisions of the chapter of passengers’ carriage to limit liability. The liability insurer or financial guarantor is entitled to raise a defence on the grounds that the damage was caused by the wilful act of the carrier or actual carrier and is also entitled to invoke any grounds other than bankruptcy or liquidation on the part of the carrier or actual carrier as a defence. It is thus evident that the statutory liability of the insurer or financial guarantor towards passengers is not entirely identical to that of the carrier or actual carrier. Should the insurer or financial guarantor invoke the limitation of liability or the defences mentioned above, passengers may be unable to obtain compensation from the insurer or financial guarantor. In such cases, passengers should be able to bring a claim for damages against the carrier or actual carrier.

Article 219 of the new CMC, drawing on the 1996 Protocol to the Convention on Limitation of Liability for Maritime Claims, significantly increases the limits of maritime liability for shipowners, salvors and other relevant parties, with substantial increases ranging from the basis of calculation to the limit per gross tonne.

Paragraph 2 of article 219 of the new CMC stipulates that the same limits of liability shall apply to other vessels not used for military or government official purposes that are involved in a collision with a ship. This provision resolves disputes over the application of the law that previously arose in judicial practice due to differences in the types of vessels involved in a collision and facilitates the efficient and fair resolution of disputes arising from ship collisions.

Article 217(3) of the new CMC stipulates that the limitation of maritime liability shall not apply to claims for compensation for oil pollution damage caused by a ship carrying oil in bulk, nor to claims for costs associated with the salvage, removal, dismantling or harmless disposal of sunken or wrecked vessels.

Article 233 of the new CMC stipulates that liability for oil pollution damage caused by ships carrying oil in bulk is subject to a special limit of liability, calculated on the basis of the ship's tonnage, with a maximum limit of approximately 89.77 million SDRs. Compensation for damage caused by ship-borne fuel oil pollution is subject to the general limit of maritime liability and shares the same limit as other claims not relating to personal injury or death.

The new CMC introduces a new Chapter 12 on “Liability for Oil Pollution Damage Caused by Ships”, systematically integrating and refining the domestic implementation of relevant international conventions. This chapter comprises section 1 “General Provisions”, section 2 “Liability for Oil Pollution Damage” and section 3 “Liability for Bunker Oil Pollution Damage”. It reflects the alignment of domestic law with the International Convention on Civil Liability for Oil Pollution Damage and the International Convention on Civil Liability for Bunker Oil Pollution Damage, providing a clear and comprehensive legal basis for resolving disputes concerning compensation for oil pollution damage occurring in waters under Chinese jurisdiction and in navigable waters communicating with the sea.

Article 225 of the new CMC stipulates that the chapter on “Liability for Oil Pollution Damage Caused by Ships” applies to claims for compensation for damage caused by oil pollution from ships occurring within waters under Chinese jurisdiction and navigable waters communicating with the sea. The scope of compensation for oil pollution damage specifically includes four categories: property loss, costs of preventive measures, loss of income, and costs of ecological and environmental restoration.

Although article 226(2) of the new CMC sets out three grounds for exemption consistent with international conventions, it adds the precondition that “reasonable measures were taken in a timely manner, but the damage could not be avoided”. The inclusion of this prerequisite for exemption is intended to guide shipowners to fulfil a higher standard of duty of care and active pollution prevention responsibilities in the event of an emergency.

Article 226 of the new CMC explicitly identifies the owner of the oil-spilling vessel as the party liable for compensation for oil pollution damage. Article 228 stipulates that where two or more vessels jointly cause damage, they shall bear joint and several liability for damage that cannot be reasonably apportioned. For example, if a collision between two vessels results in an oil spill from one vessel, the owner of the spilling vessel, having borne liability for compensation, is entitled to seek recourse against the owner of the non-spilling vessel in accordance with article 230 of the new CMC. It can be seen from the above provisions that, where a collision between two vessels leads to an oil spill from one vessel, the non-spilling party faces the risk of recourse from the spilling vessel's owner, rather than bearing direct liability for oil pollution damage.

Article 229 of the new CMC establishes a system of compulsory liability insurance for oil pollution damage caused by ships and explicitly stipulates that claimants are entitled to make claims directly against the shipowner's liability insurer or financial guarantor. The liability insurer or financial guarantor shall bear liability for compensation within the statutory limits of liability. This article further stipulates that even if the shipowner forfeits the right to invoke maritime liability limits, this does not preclude the shipowner's liability insurer or financial guarantor from continuing to rely on the statutory limits as a defence. The system of compulsory liability insurance and direct claims ensures that victims can exercise their right to compensation directly against insurers with the financial capacity to pay, while allowing insurers and guarantors to independently exercise their right to limit liability, thereby increasing the avenues and safeguards for compensation for oil pollution damage caused by ships.

This provision also clarifies that the State shall, in accordance with the law, refine and implement a ship-source oil pollution damage compensation fund system, serving as a secondary source of compensation to be activated when payments from the shipowner and their insurer are insufficient, thereby ensuring that victims receive more comprehensive and effective redress. China's system of liability insurance and compensation funds for oil pollution damage caused by ships has already been established. On 18 June 2015 the China Oil Pollution Damage Compensation Fund Management Committee was established to oversee the operation of the oil pollution damage compensation fund.

Chapter 12, section 2 of the new CMC sets out the liability for oil pollution damage caused by ships carrying oil in bulk. Article 233 stipulates the method for calculating the limits of liability, which is consistent with the standards laid down in the 2000 amendments to the 1992 International Convention on Civil Liability for Oil Pollution Damage, to which China is a party. Article 236 provides that where, prior to the distribution of a liability limitation fund, the shipowner or their liability insurer or financial guarantor has already made a payment to a claimant for oil pollution damage, they may seek subrogation against the liability limitation fund. Furthermore, the costs incurred by the shipowner in taking preventive measures are eligible for distribution from the fund. The provision that subrogation rights and the costs of preventive measures are eligible for distribution from the fund serves to incentivise shipowners to proactively and promptly take preventive measures, such as oil spill clean-up, following an incident to prevent the damage from spreading, thereby effectively guiding all parties to work together to mitigate the actual consequences of pollution damage.

Section 3 of Chapter 12 sets out the liability for pollution damage caused by tanker oil of ships. Article 239 of the new CMC provides that the limits of liability for damage caused by tanker oil pollution shall be governed by the provisions of Chapter 11, “Limitation of Liability for Maritime Claims”, and stipulates that claims for damage caused by tanker oil pollution and other claims subject to limitation arising from the same incident shall be satisfied within the same limit of liability. The limits of liability for damage caused by tanker oil pollution (including other damages for which liability may be limited as provided for in article 216) shall be governed by the provisions on the limitation of liability for maritime claims.

Furthermore, article 202 of the new CMC stipulates that pollution losses and costs shall be borne by the liable party alone and shall not be apportioned amongst the beneficiaries as a special sacrifice under the doctrine of general average. This prevents environmental costs from being passed on to innocent parties such as cargo owners who are not liable, ensures the implementation of the “‘polluter pays”‘ principle within the general average system, and upholds the fairness of the apportionment mechanism.

Article 235 of the new CMC provides that where a liability limitation fund has been established and the shipowner is entitled to limit his liability, a claimant for compensation for oil pollution damage may not apply to the court for the imposition of preservation measures on the shipowner's property; any preservation measures already taken shall be lifted, and any security deposit or other security already provided by the shipowner to avoid or lift such measures shall be refunded.

The new CMC includes insurance contracts for ships under construction within the scope of Chapter 13 on “Contracts of Marine Insurance”. According to article 245, an insurance contract for a ship under construction refers to a contract whereby the insurer, in accordance with the agreement, is liable to compensate the insured for losses and liabilities arising from marine perils suffered by the ship during its construction at the shipyard, sea trials and delivery, and for which the insured pays the premium. Ships under construction include materials, machinery and equipment used in the construction of ships in accordance with the terms of the shipbuilding contract. The new CMC clarifies the applicable law for shipbuilding insurance, thereby avoiding a situation where both the Insurance Law and the CMC might apply due to differences in the nature of insured perils stipulated in the shipbuilding insurance contract or the different stage of shipbuilding at which an incident occurs.

Article 247 of the new CMC stipulates that, prior to the conclusion of the contract, the insured shall truthfully disclose to the insurer any material circumstances of which the insured is aware, or ought to be aware in the ordinary course of business, that may affect the insurer's determination of the premium rate or its decision as to whether to accept the cover. Article 248 imposes clear time limits on the insurer's right of rescission, stipulating that such right shall lapse if the insurer fails to exercise it within 30 days of the date on which it became aware, or ought to have become aware, of the grounds for rescission.

Furthermore, article 248 amends the rules in the former CMC regarding the refund of premiums upon termination of the insurance contract by the insurer, distinguishing between different circumstances of termination. (1) Where the insured, through wilful misconduct, fails to truthfully disclose to the insurer material facts affecting the insurer's determination of the premium rate or its decision to accept the cover, the insurer shall be entitled to terminate the contract without refunding the premium. (2) Where, through no wilful act on the part of the insured, the insured has failed to truthfully disclose to the insurer material facts affecting the insurer's determination of the premium rate or its decision as to whether to accept the cover, the insurer shall be entitled to terminate the contract or to demand a corresponding increase in the premium. Where the insurer terminates the contract before the commencement of the insurance cover, it shall refund the full premium but shall be entitled to charge an administrative fee. Where the insurer terminates the contract after the commencement of cover, it shall refund to the insured the premium for the period from the date of termination to the expiry of the insurance period; however, in the case of termination of a voyage insurance contract, the insurer may withhold the premium. The insurer shall be liable for losses arising from a marine insurance incident occurring prior to the termination of the contract, except where the failure to disclose or the misrepresentation of material facts contributed to the occurrence of the marine insurance incident.

Article 249 of the new CMC introduces new provisions regarding the insurer's duty to draw attention to and explain standard terms of insurance contracts. This article stipulates that where a marine insurance contract employs standard terms provided by the insurer, the insurer shall, at the time of concluding the contract, draw the insured's attention in a manner sufficient to ensure the insured's awareness to any terms that exempt or limit the insurer's liability and which are of material interest to the insured. If the insured requests an explanation, the insurer shall provide a clear explanation of such terms. Where the insurer fails to fulfil the duty to draw attention to or explain such clauses, resulting in the insured failing to notice or understand clauses of material interest to them, the insured may claim that such clauses do not form part of the contract, except where the insured knew or ought to have known the content of such clauses.

In the case of marine insurance, the insurer's duty to explain such clauses applies only where the insured so requests. This indicates that marine insurers bear only a “passive duty to explain”, which differs from the “active duty to explain” imposed on insurers under the Insurance Law in respect of non-marine insurance.

Article 257 of the new CMC stipulates that an open cover must be concluded in writing and defines it as a contract whereby “the insurer assumes liability for the insured's goods transported in instalments over a specified future period”. The insured has a duty to declare to the insurer information regarding the carriage of goods in instalments. Regarding the legal consequences of a breach of this duty, article 259 of the new CMC distinguishes between two scenarios: intentional and unintentional failure to declare or incorrect declaration. (1) Intentional breach: the insurer shall not be liable for compensation for losses arising from that particular carriage but shall retain the right to collect the premium. (2) Non-intentional breach: the insured may make a supplementary declaration or correction, and such rectification shall not affect the right to make a claim; however, the insurer is entitled to calculate the insured value in accordance with the standards set out in article 243(2), ie the insurance shall be deemed to be without an agreed insured value, and the application of an agreed insured value shall be excluded.

Article 261 of the new CMC sets out new provisions regarding the legal consequences of the insured's breach of the warranty clauses stipulated in the contract. First, where the insurer notifies the insured in writing of the termination of the contract, the contract shall be terminated upon the notice reaching the insured. Secondly, the insurer remains liable for losses occurring prior to the breach of the warranty clauses. In respect of losses occurring after the breach of the warranty provisions but before the notice of termination is received, the insurer shall, in principle, not be liable for compensation; however, two exceptions have been established, namely, where the insured can prove that there is no causal link between the breach of the warranty and the incident, or where the incident occurred after the breach had been rectified, the insurer shall still be liable for compensation.

The above amendments have abolished the rule of absolute exemption from liability for breach of warranty contained in the former CMC, allowing for remedies in specific circumstances. Such provisions not only prevent the unjust outcome of the insured losing all cover due to a minor breach unrelated to the insured incident but also fulfil the compensatory purpose of insurance through the rule that compensation is still payable once the breach has been rectified. This amendment is essentially identical to the rules on breach of warranty provisions in the UK Insurance Act 2015.

Paragraph 1 of article 284 of the new CMC provides that the limitation period for claims for compensation in respect of the carriage of goods by sea is one year; for claims by the shipper, the period commences on the date of delivery of the goods or the date on which delivery should have taken place. The carrier's right of action shall run from the date on which the carrier knew or ought to have known of the infringement of its rights. For example, where a carrier suffers loss due to a false declaration by the shipper, the limitation period shall run from the date on which the carrier discovers the error in the declaration. The one-year limitation period for the carrier's right of action differs significantly from the six-year limitation period under English law.

Paragraph 2 of article 284 provides that where the limitation period specified in the preceding paragraph has expired, or where less than 90 days remain before its expiry, the limitation period for a right of recourse enjoyed by a person found liable against a third party shall be 90 days, calculated from the date on which the claimant for recourse settles the original claim for compensation. This provision on the limitation period for recourse differs markedly from the rules on the limitation period for recourse set out in the Hague-Visby Rules.

Article 288 of the new CMC stipulates that the limitation period for claims arising from a collision between vessels is two years, calculated from the date on which the collision occurred. Where a collision occurs between vessels and both vessels are at fault, they shall bear joint and several liability for personal injury or death caused to a third party. Where a vessel pays compensation in excess of the proportion specified in the first paragraph of the article, it shall be entitled to seek recourse against the other vessel at fault. The limitation period for a claim for recourse shall be one year, calculated from the date on which the party makes the joint and several payment of damages. A new third paragraph has been added to article 288, stipulating that the aforementioned limitation periods apply to claims or rights of recourse arising under article 179 of the Code (situations where, although no collision has occurred, damage is caused to another vessel, its crew, cargo or other property). This amendment broadens the scope of application of the limitation periods and facilitates the timely resolution of disputes relating to vessel collisions.

Article 290 of the new CMC stipulates that the limitation period for claims for the apportionment of general average is one year, calculated from the date on which the general average adjustment is concluded. This provision introduces a maximum limitation period, namely that the period shall not exceed six years from the date of termination of the common voyage. This amendment establishes a maximum protection period to prevent prolonged uncertainty regarding rights and obligations arising from protracted adjustment processes, thereby safeguarding the legitimate rights and interests of all parties concerned.

Article 291 of the new CMC adjusts the starting point for the limitation period for claims for maritime insurance indemnity from “the date of the insured event”, as stipulated in the old CMC, to “the date on which the insured became aware, or ought to have become aware, of the maritime insurance incident”. This amendment is consistent with maritime insurance practice and serves to avoid the unreasonable consequence of the insured losing their right to claim due to a failure to become aware of the incident in a timely manner through no fault of their own.

Article 266 of the former CMC provided that where, during the final six months of the limitation period, the right of claim could not be exercised due to force majeure or other impediments, the limitation period would be suspended. The limitation period would resume from the date on which the cause of suspension ceases to exist. Article 293 of the new CMC retains this rule and introduces a new provision regarding the expiry of the limitation period, namely that the limitation period shall expire six months after the date on which the cause of suspension ceases to exist.

Article 267 of the former CMC provided that the limitation period was interrupted by the claimant bringing legal proceedings, submitting a claim to arbitration, or the defendant's consent to perform the obligation. Article 294 of the new CMC amends the ground for interruption from “the defendant's consent to perform the obligation” to “the claimant's demand for performance”. This amendment significantly alters the circumstances under which the limitation period is interrupted; it no longer requires the defendant's consent to effect such an interruption, making it easier for the claimant to achieve an interruption of the limitation period. This legislative amendment regarding the grounds for interruption of the limitation period warrants the attention of parties involved in disputes.

Paragraph 2 of article 295 of the new CMC introduces a new provision stipulating that contracts of carriage of goods contracts where the port of loading or discharge is situated within the territory of China are subject to the mandatory application of the provisions of Chapter 4 (Contracts for the Carriage of Goods by Sea) of the new CMC. This constitutes a significant exception to and restriction on the principle of party autonomy. It is worth noting that the mandatory application here applies solely to Chapter 4 of the new CMC, and not to the entire new CMC, let alone Chinese law in general. For example, if a contract for the international carriage of goods to or from China is governed by English law, and a dispute arising from that contract is heard by a Chinese court, the Chinese court will apply Chapter 4 of the new CMC to determine the parties’ rights, obligations and liabilities. However, for other legal issues – such as limitation periods and the validity of the contract – which are not regulated by Chapter 4 of the new CMC, the agreed English law may still be applied.

The new CMC introduces new provisions regarding the applicable law for property rights in relation to ships. With regard to ownership of ships under construction, article 296 stipulates that where the ship has been registered, the law of the country of registration shall apply; where the ship has not been registered, the law of the place of construction shall apply. Paragraph 3 of article 297 provides that, in the case of a mortgage over a ship under construction, where the ship has been registered, the law of the country of registration shall apply; if the vessel has not been registered, the law of the place of construction shall apply. Article 298 provides that, in respect of maritime liens, the law of the forum shall apply. Article 299 provides that, in respect of a possessory lien on a ship, the law of the place where the vessel is retained shall apply. These new provisions provide clear rules on the application of law for the construction, sale and financing of vessels.

Article 304 of the new CMC provides that liability for oil pollution damage shall be governed by the law of the place where the damage occurred. This provision embodies the principle of prioritising the protection of the environment and the rights of victims. The application of the law of the place where the damage occurred to oil pollution cases generally means that the law of the country affected by the pollution applies, which is more conducive to the restoration of the local ecological environment and to the aggrieved party obtaining full compensation.

The new CMC has introduced provisions allowing the parties to agree on the applicable law in respect of ship collisions (article 301) and the apportionment of general average (article 302).

Article 308(2) of the new CMC authorises the Chinese Government to take corresponding countermeasures should any country or region impose discriminatory measures against China in the fields of maritime transport and shipbuilding. This provision serves as a legal instrument for safeguarding national interests, granting the State the power to adopt flexible countermeasures within the legal framework. The Chinese Government may, on this basis, take administrative countermeasures.

Article 309 of the new CMC defines mutual insurance associations for shipowners as mutual insurance clubs and sets out their operational model, stipulating that they may compensate members for losses and liabilities in accordance with the articles of the clubs.

XX Export Company and Another v XX International Ltd (Third Party: Shanghai XX Supply Chain Management Co Ltd) (2025) ZGFMS 320 (Supreme People's Court)

The port of loading agent issued the bill of lading in question, which named XX Export Company as the shipper. Shanghai XX Supply Chain Management Co Ltd (Supply Chain Company) obtained the bill of lading through a debt-for-goods settlement without endorsement from the Mineral Company. The Mineral Company was not the shipper named on the bill of lading but acquired the bill of lading in question through an incomplete chain of endorsements. Both Supply Chain Company and XX Export Company claimed that they had the original bills of lading and were entitled to the goods under the bills. During the retrial of this case, Supply Chain Company argued that the bill of lading held by the export company was forged, that the validity of the bill of lading it held took precedence over that held by XX Export Company, and that, as the assignee of the debt, it was entitled to take delivery of the goods.

Regarding the alleged forged bill of lading, Supply Chain Company submitted a professional evaluation report proving that the seal of the port of loading agent affixed to the bill of lading held by XX Export Company was not the same as the seal affixed to the evidence sample and claimed that the bill of lading held by XX Export Company was forged. The Supreme People's Court held that the difference in seals was insufficient to conclude that the bill of lading held by XX Export Company was forged. Furthermore, the port of loading agent testified that the bill of lading held by XX Export Company was forged. However, the Supreme People's Court held that, as the port of loading agent was an interested party in the bill of lading issuance process, the authenticity of one party's bill of lading could not be established – and that of the other party denied – solely on the basis of a statement from an interested party.

Regarding the validity of the bill of lading, the Supreme People's Court held that, first, the order bills of lading held by both Supply Chain Company and XX Export Company each designated XX Export Company as the shipper under the order bill of lading; the shipper under an order bill of lading is entitled to demand delivery of the goods from the carrier on presentation of the bill of lading. XX Export Company was therefore entitled to claim the goods from the carrier on presentation of its bill of lading.

Baijian Co and Others v Lingyuan Co (2024) LMZ 1242 (Liaoning High People's Court)

Company A was the seller of the goods in question, Company B was the buyer, and Jianfa Energy Co was Company B's agent. Company A instructed Company D to charter a vessel from Lingyuan Co (Company C), thereby establishing a legal relationship under a voyage charterparty between Baijian Co (Company D) and Company C, with Company C acting as the shipowner and Company D as the charterer. Clause 1(3) of the voyage charterparty stipulated that the term “Cargo interests” included the consignor, shipper, consignee, receiver, bill of lading holder, owner of the goods and any person entitled to possession of the goods. Clause 12, “Lien”, provided that: “the Carrier shall have a lien on the goods and related documents to secure payment by the Party to the Cargo of freight, demurrage, detention and any other sums payable under the bill of lading or any other contract, as well as the share of general average contributions and recovery costs to be borne by any party”.

After Company C received the first instalment of payment the master, acting on behalf of Company C, issued a bill of lading naming Company A as the shipper and Jianfa Energy Co as the consignee and the notifying party. The charterparty was incorporated into the bill of lading, and the freight was payable in accordance with the charterparty. During the performance of the voyage charterparty, a dispute arose when Company C refused to release the goods on the grounds that it had not received the full amount of freight and demurrage charges.

Qingdao A Logistics Co Ltd v Wan Hai Lines (Singapore) Pte Ltd (2024) LMZ 847 (Shandong High People's Court)

Qingdao A Logistics Co Ltd (Company A) exported goods to the United States. Wan Hai Lines (Singapore) Pte Ltd (Wan Hai Lines) undertook the carriage of the goods. After the goods were unloaded in New York, USA, Company A issued a Declaration of Abandonment of Ownership of Goods to Wan Hai Lines. Subsequently, the consignee issued a Declaration of Abandonment of Goods to Wan Hai Lines, stating that the consignee guaranteed to release the carrier from all liability, agreed to indemnify the carrier and other relevant transport parties, and to hold them harmless from any litigation and all claims that might be brought in any other jurisdiction arising from or in connection with the loss, damage and/or costs caused by the consignment. The goods in question were auctioned off, and the empty containers were returned in due course. Wan Hai Lines claimed that Company A should pay Wan Hai Lines charges for the overdue use of the containers, demurrage, warehouse fees and the corresponding interest.

The court of first instance pointed out that article 61 of the “Minutes of the Symposium on Foreign-Related Commercial and Maritime Adjudication by People's Courts Nationwide” (the Minutes) stipulates that:

Zhejiang Osee Import & Export Co Ltd v ZIM Integrated Shipping Services Ltd (2024) Z 72 MC 2640; [2026] 2 CMCLR 36 (Ningbo Maritime Court)

Zhejiang Osee Import & Export Co Ltd (Osee) booked space with ZIM Integrated Shipping Services Ltd (ZIM) to ship a consignment of containerised goods. According to information on ZIM's website, after the goods arrived at Port-au-Prince, Haiti, the consignee was consistently unable to collect the goods at the port of destination. ZIM subsequently informed Osee that the containers had been lost following a robbery by a criminal gang at the port of destination.

Osee contended that ZIM's failure to exercise due care and take appropriate measures to safeguard the goods resulted in a loss to Osee and claimed that ZIM should compensate Osee for the loss of the goods. ZIM argued that the goods in question had already arrived at the port of destination and were lost as a result of armed conflict in Port-au-Prince, Haiti; this constituted a case of loss of goods caused by war or armed conflict as provided for in article 51 of the CMC, and the carrier was therefore exempt from liability under the law.

The court hearing the case analysed the exemption issue. First, while the CMC does not provide a specific definition of “armed conflict”, article 268 stipulates that where an international treaty concluded or acceded to by the People's Republic of China contains provisions differing from those of the CMC, the provisions of the international treaty shall apply. In the present case, the question of whether the situation giving rise to the loss of the goods constitutes an “armed conflict” could be analysed and determined in accordance with the provisions of the relevant international conventions. Pursuant to article 1 of the Protocol Additional to the Geneva Conventions of 12 August 1949, and Relating to the Protection of Victims of Non-International Armed Conflicts (Protocol II), such an armed conflict refers to a protracted armed confrontation occurring within the territory of a state between the government's armed forces and one or more organised non-state armed groups holding dissenting political views and controlling part of the territory. This provision indicates that for a situation to constitute a non-international armed conflict, certain elements must be present, including violent conflict reaching the level of military confrontation, the division of territorial control, the protracted nature of military operations, and the manifestation of political claims. At the time the losses in question occurred, although gang activity in Haiti had caused severe social unrest and violent incidents, it did not yet meet the aforementioned criteria and therefore did not constitute a non-international armed conflict. In light of the foregoing, ZIM could not invoke war or armed conflict as a ground for exemption from liability for compensation for the loss of the goods.

Secondly, article 51(1)(12) of the CMC provides that the carrier shall not be liable for loss or damage to the goods “not caused by the negligence of the carrier or the carrier's servants or agents”; furthermore, para 2 of that article stipulates that where the carrier is exempt from liability under the provisions of the preceding paragraph, the burden of proof shall rest with the carrier, except in the case of the grounds of fire on board. The court held that, given the consistent deteriorating security situation in Port-au-Prince, Haiti, and the rampant activities of criminal gangs, ZIM had fulfilled its duty of care and diligence in managing the goods under normal circumstances by issuing a notice of arrival prior to the goods reaching the port of destination and successfully unloading the goods at that port. ZIM had provided evidence demonstrating that the loss of the goods in question was caused by robbery by Haitian gangs; it was not at fault for the loss of the goods and could therefore be exempt from liability for compensation pursuant to article 51(1)(12) of the CMC.

This case concerns the legal issue of whether the carrier may be exempt from liability for the loss of the goods. The court conducted a detailed analysis of whether the gang robbery at the port of destination constituted an armed conflict and applied the relevant international conventions. This is a rigorous legal method for judgment.

In this case, the carrier did not appear to have invoked the defence that the loss was “‘not caused by the negligence of the carrier or its servants or agents”‘. If this is indeed the case, the court identified the applicable defence for the carrier of its own motion. This demonstrates the proactive approach of Chinese courts in adjudicating cases in accordance with the law, which is a distinctive feature of the Chinese judicial system.

A (Shanghai) International Freight Forwarding Co Ltd Dalian Branch v Shanxi B Industry and Trade Co Ltd (2025) LMZ 291 (Liaoning High People's Court)

Shanxi B Industry and Trade Co Ltd (Company B), as the seller of the goods, entered into a contract of sale with an overseas buyer, Company D, stipulating that the terms of delivery were FOB. Company B and A (Shanghai) International Freight Forwarding Co Ltd Dalian Branch (Company A) agreed on the scope of the agency services for which Company A was authorised in a maritime freight forwarding contract.

The container carrying the goods in question was unloaded at the port of destination. Company A repeatedly notified Company B that no one had collected the goods at the port of destination and that demurrage and storage charges had accrued. Company A paid the demurrage charges to the carrier. Company A requested that Company B reimburse it for these demurrage charges.

Tangshan Caofeidian X Company v China G Company Ningbo Branch (2025) MMZ 664 (Fujian High People's Court)

Company X entered into a voyage charterparty agency contract with Company G to transport goods belonging to Company X. The goods were damaged during transit, and Company X claimed compensation for the damage from Company G. Company G argued that the relationship between the parties was that of an agency relationship and that it therefore bore no liability for the damage in carriage.

Shanghai A Co v Guangzhou B Co (2024) YMZ 6984 (Guangdong High People's Court)

Chinese A Insurance Company Shanghai Branch v B Shipping Company (2025) ZGFMS 3693 (Supreme People's Court)

B Shipping Co took out an All Risks Marine Insurance policy for the vessel owned by it, with Chinese A Insurance Company Shanghai Branch (A Insurance Co). Clause 1 (Scope of Cover) of the insurance policy stated:

"Total loss cover is provided for total loss of the insured vessel caused by the following perils: 1. Earthquakes, volcanic eruptions, lightning or other natural disasters; 2. Grounding, collision, contact with any fixed or floating object or other object, or other maritime perils; 3. Fire or explosion; 4. Violent theft or acts of piracy from outside the vessel; 5. Abandonment of cargo; 6. failure or accident involving a nuclear device or nuclear reactor; 7. This insurance also covers total loss of the insured vessel caused by the following: (1) accidents occurring during the loading, unloading or movement of cargo or fuel; (2) latent defects in the vessel's machinery or hull; (3) acts by the master or crew committed with intent to prejudice the interests of the insured; (4) Negligence on the part of the master, crew, pilots, repairers and charterers; (5) Actions taken by any governmental authority to prevent or mitigate pollution resulting from damage to the insured vessel caused by a covered risk. However, such loss shall not be attributable to a failure by the insured, the shipowner or the manager to exercise due diligence."

During the period of insurance, water entered the vessel's cargo holds. After the ingress of water had been effectively contained, an explosion occurred in the engine room. The sudden explosion and resulting fire caused the vessel to become uncontrollable and resulted in a power failure, rendering the vessel unable to provide power for pumping out water. At the same time, the vessel lost its propulsion due to the power failure. The insured failed to arrange for salvage, and the vessel ultimately sank. The insured claimed insurance compensation.

Tianjin X Shipping Co Ltd v Y Marine Engineering Co Ltd (2025) ZGFMS 5391 (Supreme People's Court)

The vessel Guoneng XX, chartered based on a bareboat charter and operated by Tianjin X Shipping Co Ltd (Company 1), ran aground. Y Marine Engineering Co Ltd (Company 2) proceeded to the scene of the incident to carry out emergency salvage operations. On the day of the incident, Company 1 issued a “Power of Attorney” to Company 2, stating:

Company 2 carried out the relevant salvage operations in accordance with this authorisation.

Company 2 prepared the following documents relating to the salvage operations in question: the Emergency Oil Pumping Operation Plan for the Stranded Vessel Guodian XX, the Emergency Rescue Operation Plan for the Stranded Vessel Guodian XX and the Grounding Recovery Plan, among other salvage-related documents. Company 2 also sent Company 1 a Quotation for Emergency Salvage Costs for the Vessel Guodian XX, which included the vessel's daily rate, fuel consumption, costs for major diving equipment, oil extraction equipment, personnel and other equipment and consumables, a 3 per cent fee for the emergency technical plan, an 8 per cent management fee, a 6 per cent tax and duty surcharge, as well as the SCOPIC rate under the special compensation clause. Upon receipt, Company 1 did not respond or raise any objections, but instead tacitly accepted the salvage process and repeatedly requested Company 2 to continue the salvage operations.

Upon completion of the salvage operation, a dispute arose between the parties regarding the salvage remuneration. Company 1 argued, first, that the parties had not reached a written agreement on the salvage rate, nor did any explicit agreement exist. The provisions of the CMC should therefore apply to determine the salvage rate in this case. Secondly, even if it were to be determined that this case constituted a contract of salvage, the SCOPIC rate, as claimed by Company 2, should not apply. Company 1 argued that the SCOPIC rate applied to maritime salvage operations involving foreign elements only; as no such foreign elements existed in this case, it should only be applied where the parties have expressly agreed to its application, which they have never done. Thirdly, the salvage rate in this case was manifestly higher than the value of the salvage services actually provided; it failed to strike a balance between the interests of the salvor and the vessel in distress, thereby contravening the legislative intent of the maritime salvage regime, which is to ensure fair trading in the salvage market.

Company 1 v Company 2 and Others (2025) ZGFMS 1482 (Supreme People's Court)

The offshore construction platform Wenqiang No 8 (Platform W), owned by Company 3, was anchored off the coast of Rudong, Shengdong, Nantong, to weather a typhoon. As it had failed to evacuate to safe waters as required and due to improper anchoring measures, the anchor chain snapped, causing the vessel to drag its anchor and collide with a pipeline bridge operated by XX Group, resulting in damage to the bridge piers and discharge pipelines. The court ruled to authorise Company 3 to establish a maritime liability limitation fund.

XX Group argued that, although the court had ruled to permit Company 3 to establish a maritime liability limitation fund, it was not entitled to benefit from the limitation of liability. The grounds for this were as follows. (1) Platform W was a non-self-propelled vessel without an engine or propulsion system; it lacked the ability to navigate under its own power and did not constitute a vessel as defined in article 3 of the CMC. Therefore, the relevant provisions of Chapter 11 of the CMC concerning the limitation of maritime liability could not be invoked. (2) Given that both the local meteorological and maritime authorities had issued typhoon warnings in advance, the defendants, while being fully aware of the potential for loss, acted with reckless negligence by failing to take necessary measures to withstand the typhoon. It did not evacuate Platform W from the construction waters to safe waters to seek shelter from the storm. Furthermore, at the time of the accident, the vessel was unmanned, its mooring arrangements to withstand the typhoon were inadequate. Furthermore, when the vessel broke anchor and ran aground, the defendants failed to take necessary salvage measures or other methods to avert the danger (such as scuttling the vessel), allowing the vessel to continue drifting, which ultimately led to the accident. Therefore, pursuant to article 209 of the CMC, the defendant was not entitled to limit its liability in accordance with the provisions of Chapter 11 of the CMC.

The court of first instance did not support the arguments. First, the question of whether Platform W constituted a vessel as defined in the CMC had already been determined by a final and binding judgment. In the case brought by Company 3 concerning the application to establish a liability limitation fund in relation to the accident in question, the Shanghai High People's Court, in its Civil Ruling (2020) HMZ 503, had already determined that Platform W was a coastal-operating vessel, Company 3 was the registered owner of the vessel and was entitled to apply for the maritime liability limitation fund. In accordance with this final ruling, Platform W constituted a vessel under the CMC, and there was no need to elaborate further on this point in the present case. Therefore, it was held that the loss caused by Platform W striking the pipeline bridge constituted a claim subject to limitation under article 207 of the CMC.

XX Shipping Co Ltd v Wenzhou XX Shipyard and Others (2025) ZGFMS 4184 (Supreme People's Court)

In this case, the inspection certificate belonging to the vessel in question recorded that XX Shipping Co Ltd (Shipping Company) was the owner. An Affiliation Agreement signed between XX Shipping Co Ltd (Shipping Company) and Wang explicitly stated that the vessel in question was funded by Wang, with full ownership vested in Wang. The vessel was sold to Zhou, then transferred to Jin, and subsequently transferred by Jin to Pan. Ship sale contracts and handover certificates were signed between the respective parties. After purchasing the vessel, Pan entered into a vessel scrapping agreement with Wenzhou XX Shipyard. The Shipyard carried out the scrapping under the supervision of the maritime authorities. The Shipping Company claimed that the Shipyard, Jin, Pan and Zhou had committed joint tortious conduct against the Shipping Company.

XX Port Shipping Co Ltd v YY Metal Shipbuilding Co Ltd (2025) ZGFMS 3873 (Supreme People's Court)

XX Port Shipping Co Ltd (XX Shipping) and the respondent, XX Metal Shipbuilding Co Ltd (YY Shipbuilding), entered into a shipbuilding contract. Clause 5.1.2.1 of the contract stipulated that if the delivery of any single vessel was delayed by more than 150 days beyond the delivery date, 1,500 yuan would be deducted from the contract price for that vessel for each day of delay. Clause 5.1.2.2 stipulated that if the delivery was delayed by more than 150 days, Party A (XX Shipping) would have the right to unilaterally terminate the contract in accordance with clause 10 of the contract and forfeit the performance bond, unless Party A agreed to re-negotiate a new delivery date after deducting the liquidated damages in accordance with clause 5.1.2.1.

As YY Shipbuilding delayed the delivery of the vessels the subject of the contract by more than 150 days, XX Shipping forfeited the performance bond. YY Shipbuilding contended that XX Shipping had not terminated the contract and claimed the return of the performance bond. XX Shipping countered that it was entitled to forfeit the performance bond even without having invoked the right to terminate the contract.

Hainan Jerry Jason Medical Technology Co Ltd v Hainan Kanghe Ship Industry Co Ltd (2025) QMZ 111 (Hainan High People's Court)

Hainan Jerry Jason Medical Technology Co Ltd (Jerry Jason Co) and Hainan Kanghe Ship Industry Co Ltd (Kanghe Co) entered into a ship sale contract, under which Jerry Jason Co agreed to purchase one fibreglass-reinforced plastic yacht from Kanghe Co. The contract specified that the engine model was VM-D-6350A. Items 8 and 9 of the Annex to the contract stipulated that the yacht's main engines were to be two American Mercury MR706LS inboard-outboard diesel engines, and the generator was to be a 10-KW Italian silent generator. Clause 8 of the contract stipulated that, upon handover of the vessel, both parties were to carry out acceptance in accordance with the Annex.

Kanghe Co and Jerry Jason Co signed a vessel handover certificate specifying that Kanghe Co would hand over the yacht to Jerry Jason Com, and that Jerry Jason Co hereby accepted it. Prior to handover, Kanghe Co was responsible for all claims, liabilities and risks relating to the yacht; following handover, ownership of the yacht passed to Jerry Jason Co, which assumed responsibility for all claims, liabilities and risks. The handover certificate took immediate effect from the date of signature by both parties. The attached Equipment Handover List specified that the engines were two MR706LS units and the generator was one PMG-8SH unit.

Jerry Jason Co contended that the yacht in question was operating with defects and was in an unseaworthy condition after delivery. It contended that Kanghe Co's delivery of the yacht did not comply with the terms of the contract, constituting fraud and a fundamental breach of contract. Jerry Jason Co claimed to rescind the contract and demanded the return of the purchase price already paid for the yacht.

The new CMC provides new legal provisions for promoting the digitalisation of shipping, strengthening ecological protection, and improving the maritime legal system and services for opening to the outside world. It lays a new legal foundation for China's maritime judicial adjudication and arbitration practices to take centre stage on the international stage. The new CMC deserves close attention from the international shipping and legal communities.

Maritime cases adjudicated by Chinese courts in 2025 continued to highlight key and challenging issues in maritime adjudication. The CMAC published exemplary arbitration cases in 2025. These issues in judicial and arbitration proceedings may give rise to new judicial rulings and arbitral awards following the implementation of the new Maritime Law. We will continue to monitor developments in China's maritime judicial and arbitration practices and provide a review of them next year.

A (Shanghai) International Freight Forwarding Co Ltd Dalian Branch v Shanxi B Industry and Trade Co Ltd (2025) LMZ 291 (Liaoning High People's Court)

A Heavy Industry Co Ltd and B Shipping Co (2025) Case Collection on Enterprises’ Global Expansion, CMAC Shanghai Headquarters, pages 1 to 9

A Shipping Limited Co v B Heavy Metals Co (2025) Case Collection on Enterprises’ Global Expansion, CMAC Shanghai Headquarters, pages 71 to 76

Baijian Co and Others v Lingyuan Co (2024) LMZ 1242 (Liaoning High People's Court)

Chinese A Insurance Company Shanghai Branch v B Shipping Company (2025) ZGFMS 3693 (Supreme People's Court)

Company 1 v Company 2 and Others (2025) ZGFMS 1482 (Supreme People's Court)

Company X1 and Others v Xiang and Others (2024) HMZ 706 (Shanghai High People's Court)

Hainan Jerry Jason Medical Technology Co Ltd v Hainan Kanghe Ship Industry Co Ltd (2025) QMZ 111 (Hainan High People's Court)

Hong Kong A Company and Others v Singapore B Shipping Company and Others (2023) H 72 MC 1936 (Shanghai Maritime Court)

Hong Kong A Shipping Co and Another v UAE C Shipping Company (2025) L 72 CB 4 (Dalian Maritime Court)

Huang v Li and Lin (2025) ZMZ 187 (Zhejiang High People's Court)

Liberian X Ship Management Co v Marshall Islands Y Overseas Trading Co (2025) M 72 CB 26 (Dalian Maritime Court)

Philippine A Shipping Co v Nantong B Shipbuilding Co (2025) S 72 RG 1 (Nanjing Maritime Court)

Qingdao A Logistics Co Ltd v Wan Hai Lines (Singapore) Pte Ltd (2024) LMZ 847 (Shandong High People's Court)

Shanghai A Co v Guangzhou B Co (2024) YMZ 6984 (Guangdong High People's Court)

Tangshan Caofeidian X Company v China G Company Ningbo Branch (2025) MMZ 664 (Fujian High People's Court)

Tianjin X Shipping Co Ltd v Y Marine Engineering Co Ltd (2025) ZGFMS 5391 (Supreme People's Court)

XX Export Company and Another v XX International Ltd (Third Party: Shanghai XX Supply Chain Management Co Ltd) (2025) ZGFMS 320 (Supreme People's Court)

XX Port Shipping Co Ltd v YY Metal Shipbuilding Co Ltd (2025) ZGFMS 3873 (Supreme People's Court)

XX Shipping Co Ltd v Wenzhou XX Shipyard and Others (2025) ZGFMS 4184 (Supreme People's Court)

Zhejiang Osee Import & Export Co Ltd v ZIM Integrated Shipping Services Ltd (2024) Z 72 MC 2640; [2026] 2 CMCLR 36 (Ningbo Maritime Court)