The conference was themed “Shipping and Chartering in Challenging Times,” with the opening session being chaired by Neil Klein of McKasson & Klein LLP from California. Neil’s session was titled “restructuring and insolvency trend in the shipping sector – legal implications and cross-jurisdictional strategies.”
Following the 2008 world economic crisis, the shipping industry has been subject to the erratic rise and fall of the market. While global financial conditions have improved over the past few years, the shipping crisis deepened in 2012 due to low supply and overcapacity, which in turn reduced charter party rates and asset values. 2013 saw some improvement in the market with short-lived spikes in freight rates, but overall rates and assets value remained low. The market continued to experience problems last year, with several major players filing for bankruptcy protection (such as OW Bunkers). This meant owners and charterers continue to struggle with losses, claims, operating expenses and financing costs.
Neil’s panel focused on how insolvency and restructuring in the shipping industry has affected vessel owners, cargo owners, charterers and mortgagees. Speakers from South Africa, China, Switzerland, England and America discussed how their clients are dealing with problems that affect their particular jurisdictions.