Neptune Atlas logo Neptune Atlas

Port calls

Port agency and disbursements

·

When a ship arrives at a port, it cannot arrange anything by itself. It cannot order a pilot, clear customs, pay a tug, send a sick crew member ashore or tell the terminal it is ready. A port agent does all of this on behalf of one party. Which party that is matters a great deal. The agent is not neutral, and was never meant to be.

What the agent does

The agent is appointed for one port call and handles everything the call needs. This includes notices before arrival, booking pilots and tugs, getting a berth from the port authority, customs and immigration, giving the notice of readiness, watching and recording the cargo work, arranging stores, fuel (bunkers), spares and repairs, crew changes, medical care, cash for the master, waste collection, and clearance to sail.

Two of these tasks matter more to a chartering desk than the rest. First, the agent gives the notice of readiness, so the agent’s actions start the laytime clock (the time allowed for cargo work). Second, the agent writes the statement of facts. That record of times is the document every later demurrage calculation (the charge for extra time in port) is built on. Everything else on the list is practical arrangements. Those two tasks produce evidence.

Whose agent

The charterparty (the charter contract) says who chooses the agent. The two usual arrangements sound almost the same but work very differently.

Owners’ agents. The owner appoints and pays the agent, whose duty is to the owner and the ship. So at the berth, the ship is represented by someone who works for the ship. This is common on voyage charters where the owner wants control of the notice of readiness and the statement of facts.

Charterers’ agents. The charterparty requires the owner to use an agent the charterer chooses. This is often the terminal’s regular agent, who may handle every ship that calls there. The owner still pays the agent for the ship’s business. It works well at the berth, because the agent knows the port and the terminal. But it creates a problem in a dispute: the person who records the times works regularly with the other side.

That is why a protecting agent, also called a husbandry agent, exists. When the owner must use charterers’ agents, the owner may appoint a second agent at the same port only to protect the owner’s interests. This agent attends the ship, checks the statement of facts before it is signed, makes sure the notice of readiness is given correctly and checks the disbursement account (the bill for the port call). The fee is small compared with a demurrage claim lost because nobody on the owner’s side read a document.

The general legal position explains this. The agent works for its principal (the party that appointed it) and owes duties to that principal. It does not become neutral because it is useful to everyone. An agent appointed by charterers still handles the ship’s business and still owes the ship the normal duties of care. But its business relationship is with the party that sends it work every week. When you read a document, know who prepared it.

The PDA and the FDA

Money at a port call moves through two documents. They have similar names but describe different things.

PDAFDA
NameProforma disbursement accountFinal disbursement account
WhenBefore the callAfter the ship has sailed and every supplier has sent an invoice
What it isThe agent’s estimate of what the call will cost The actual costs, with the suppliers’ invoices attached
What it is forPaying the agent in advance, and pricing the voyageFinal payment. A balance owed to or by the agent

The owner normally sends the agent money against the PDA before the ship arrives. This is because the agent is about to pay the port authority, the pilots and the tugs from its own account. When the FDA comes, whichever side owes the difference pays it.

Most items on a typical account are costs nobody controls: port dues, tonnage or light dues, berth or quay dues, pilots in and out, tugs, mooring and unmooring, launch hire, the ISPS security charge, waste collection, the agency fee, and anything extra the ship ordered. The agency fee is often the smallest line on the page.

Why a low PDA is not a saving

The mistake is to treat the PDA as the cost of the call. It is an estimate, and agents quote it to win business. An agent competing on the estimate has an easy way to win: quote low. The FDA is the real number, and it arrives weeks later, when the voyage has been priced and often already fixed (agreed).

Three things often cause the difference:

The useful habit is to compare the same kind of figure. Compare PDA with PDA at the same port, for the same size of ship and the same expected stay, and then compare FDA with FDA over time. An agent whose estimates end up close to the final account is worth more than one whose estimates are low. The only way to know which agent you have is to keep both numbers.

Who pays for what

The charter decides this, and the usual pattern is clear. Under a voyage charter, the owner normally pays the port costs, because they are included in the freight. The terms may still put some specific charges on the charterer. Under a time charter, the charterer pays the port charges. The owner pays for the crew, the stores and the ship’s own care and supplies. See voyage charter versus time charter for the wider split.

In both cases, the ship’s own items on an FDA belong to the owner, even when a charterer’s agent paid them. A disbursement account that mixes the two without separating them is the most common cause of a needless argument when the accounts are settled.

The document to actually read

If you read only one document from the agent, read the statement of facts. Read it before it is signed, not after. It records arrival, notice of readiness given and accepted, berthing, start and end of loading, every stoppage with its reason, weather, shifting between berths, and sailing. Those times decide the laytime, the laytime decides the demurrage, and the demurrage is often larger than all the other lines on the disbursement account added together.

References

The statement of factsThe agent’s timed record of everything that happened in port. Every demurrage claim is decided on it, long after anyone was there to see. Notice of readinessThe one page that starts the laytime clock: arrived, ready, tendered, and the different way each of those three is challenged. How to calculate laytime and demurrageWhen the clock starts, what stops it, how the demurrage figure is worked out, and why most claims fail on the paperwork, not on whether they were right. Who is who on a fixtureA dozen parties, several called the owner and two called the agent. Who gives instructions to whom, and who you may phone.

Neptune Atlas

The agent's statement of facts is where laytime comes from, and Neptune Atlas turns that document into a laytime sheet directly rather than having somebody retype the timings into a spreadsheet, with every stoppage kept as the agent recorded it. Every paid plan starts with 7 free days. A card is needed to start them, and cancelling before they end costs nothing.

Try 7 days free Ship chartering software for brokers What each plan includes