BIMCO’s new clause to support biofuel use in time charters

BIMCO Introduces New Clause to Support Biofuel Use in Time Charter Agreements
June 5, 2025, by HABIBIC AVERAGE

BIMCO, a shipping association, has established a new subcommittee to create a Biofuel Clause for Time Charter Agreements to tackle the legal and operational obstacles arising from the increased adoption of biofuels in the shipping industry.
With regulations like the EU ETS, FuelEU Maritime, and the forthcoming IMO Net-zero Framework shaping the maritime sector’s future, ship owners and operators are seeking ways to cut emissions through biofuel usage.
Given the complexities involved in integrating biofuels into charter contracts, which often raise concerns about fuel quality, engine compatibility, and liability, BIMCO aims to develop a new clause to address these issues.
The newly formed subcommittee, comprising shipowners, charterers, P&I representatives, and technical experts, convened for the first time on April 7, 2025.
This subcommittee’s objective is to define the scope and standards for biofuels, clarify their supply and handling procedures, and ensure that their utilization aligns with performance expectations and regulatory requirements, as outlined by BIMCO.
The new clause will also take into account the practical aspects of biofuel usage, such as blending with traditional fuels, onboard storage, and the impact on speed and fuel consumption warranties, with the goal of providing a flexible and robust contractual solution that supports compliance while maintaining vessel reliability.
BIMCO anticipates presenting a draft of the clause at its Documentary Committee meeting in October 2025, stating that once implemented, it will offer much-needed guidance for charterers and owners navigating the shift to low-carbon operations.