Recent Brazilian court decisions on offhire and early termination resulting from "vessel blocking": a study from English and Norwegian laws perspectives

Abstract

Following the severe downturn in the offshore market, almost all shipowners with foreign vessels time chartered to PETROBRAS in Brazil were hit unexpectedly by offhire and early termination notices without compensation by PETROBRAS allegedly due to the charter of their foreign vessels having been blocked by Brazilian vessels available in the market. In view of PETROBRAS’ willingness to charge other amounts under the charterparties and reluctance to negotiate, many shipowners disputed the offhire and early termination against PETROBRAS in Brazilian courts. Differently from one may expect, most of such claims having been ruled favourable to the shipowners so far. Considering that Brazilian courts have recently been criticised for certain controversial decision in the field of maritime law, the purpose of this master thesis is (i) to understand the position of the Brazilian courts towards offhire and early termination claims against PETROBRAS resulting from vessel blocking; and (ii) to verify if the decisions would be similar if the disputes were subject to either English or Norwegian law.