In the charter scene, contracts between fleet operators and end customers have been a difficult topic for years. Everyone cooked their own little soup, some general terms and conditions were just one DIN A4 page long, others were 8 pages long in tiny font sizes. Quite a few of the charter companies' contracts heaped a mountain of obligations on the skipper, but were remarkably light on their own liability.
As a result, YACHT repeatedly warned of rather critical clauses in the contracts, which sometimes entailed almost incalculable risks. And there were many: For example, when the deposit amount stated in the contract, generally the amount of the excess of the hull insurance of the boat, was described in the contract as follows: "The deposit does not have to correspond to the amount of the excess of the hull insurance". However, the latter is not mentioned anywhere. So the skipper effectively signed a blank cheque for the fleet operator. That could be expensive.
Charter contracts often have pitfalls for the customer
Or if the contract contained clauses such as "Defects or missing equipment on board do not entitle the customer to a reduction in the charter price". In other words: bow thruster broken, autopilot not working, dinghy outboard missing - no chance of financial compensation. The yacht has even seen contracts in which the sails or dinghies were excluded from the hull liability.
It has to be said that 90 per cent of charter holidays go off without any major problems and customers don't need to read their contracts in detail, but they should do so because a lot of very important things are regulated there: How much do you have to pay if you have to cancel your holiday at short notice? How long do you have to wait if a ship is not ready for departure when the crew arrives?
The European industry associations wanted to define the standard
This problem should now be tackled at European level. To this end, the International Council of Marine Industry Associations (ICOMIA)The European Boating Industry (EBI) took the Fair Charter Contract of the German insurer YACHT-Pool as a basis and, together with the national charter associations, in Germany the Association of German Yacht Charter Companies (VDC), developed it into a standardised document. After a long period of consultation, a 5-page document has been produced that presents the rights and obligations of customers and fleet operators in a balanced manner and, above all, takes into account the latest EU legislation.
"It was indeed the case that charter contracts of individual fleet operators contained provisions that were not at all compatible with EU law," says Dr Friedrich Schöchl from the insurance broker YACHT-Pool. Many years ago, his company tackled the problem and formulated the so-called "fair charter contract", which was intended to put an end to the dilemma. The proposal was well received in Croatia, but it remained the exception on the international charter market. "The EBI then approached me and asked whether we could work together to develop a standard work for the European market based on the treaty. That has now happened."
A lot of ignorance on the part of fleet operators
And so, two old contract law issues that still linger in the minds of many skippers, agents, fleet operators and lawyers have been cut off: "Two important points concern the place of action and the law according to which negotiations take place when a charter is disputed. Many fleet operators still thought that the German customer would have to sue them at the company's registered office, which made no economic sense due to travelling costs, translation costs, etc. for decades. This made no economic sense for decades."
Some fleet operators knew this and thought they were safe. "But the EU has long since clarified this via consumer protection rights: If the company through which the contract is concluded has a German website and German contracts, German law applies, regardless of where the company is based abroad. And secondly: The court at the customer's place of residence is the court of jurisdiction!" says Dr Schöchl.
So now there are these EU-agreed "General Charter Conditions", which are recommended by the respective national associations of the charter scene to their member companies and fleet operators. However, this is not binding; each company decides for itself whether to follow the regulations or not. As a guideline, however, the recommendation is sure to meet with an open ear, as it saves companies from having to seek their own expensive legal advice.
The Association of German Yacht Charter Companies (VDC) is also pleased that there is finally some movement on the issue, according to its Chairman Christian Zaloudek: "We have been in talks with our European fleet partners for many years about standardising the contracts. This is simply much more customer-friendly and makes things much clearer for them and the agencies. That is why we have also worked hard on the development of this common standard contract in many rounds of consultations. And we can now warmly recommend it to our fleet partners for the future, as it carries a whole new weight. I think this will be heard."
The advantages for skippers
But what does it actually say that is remarkable and better for the charter crews? Firstly, there is the unmistakable rule that a delay in the handover of the charter yacht, for example because it still needs to be repaired, entitles the charterer to a proportional reduction in the charter price. Waited a day for the ship? One day less paid!
Defects in equipment, i.e. defective or missing equipment, now also entitle you to financial compensation. The promised bow thruster is missing? There is no outboard motor for the dinghy?
There is also always trouble with the return of the deposit. Companies keep them for longer from time to time, even though there have been no complaints. It is now regulated: the money must be released 24 hours after return. Another problem sometimes arises: the crew wants to return a boat, but there is no base employee to check it out before their return journey. According to the new contract, the following applies: If the boat is returned on time and the base manager fails to take over or refuses to provide a signed copy of the return report, the boat is deemed to have been returned in perfect condition.
The good thing about the new contract is that it regulates many of the small details that occur in practice. Dr Friedrich Schöchl agrees: "Many things from decades of experience with our deposit and skipper liability insurance policies have been incorporated into the contract."
Incidentally, this also includes a point that has long been hushed up by charter companies: The GPS tracking of ships. Many fleets have been equipped with sensors for years. How this fits in with European data protection was always a question that nobody really wanted to tackle. The new draft agreement now openly mentions the GPS tracking of ships.
Of course, the 5-page document also contains various obligations for the skipper: reporting damage immediately, penalties for late return, liability for gross negligence beyond the scope of the insurance and similar. That's why reading the terms and conditions of a charter should simply be part of it, even if hardly anyone feels like doing so in the course of holiday anticipation.
