Dede's Law and Business Series:

Introduction To Shipping Business (1)

By Foluke Akinmoladun

The maritime industry encompasses all businesses and commercial activities relating to navigable waters such as the seas, oceans, lakes, rivers and their exploitation and shipping is a major component of this industry. Whenever the word carriage by sea appears it simply means the act of employing a ship or vessel services or simply put, the art of shipping. Shipping is therefore defined as the art of putting and receiving goods often referred to as ‘cargo’ on board a ship or vessel and the transportation from one point to another on any stretch of water.

With the advent of trading patterns expanding across borders and the commercial imperativeness to transport goods from the areas of production to areas of consumption, business men and women had to engage the use of shipping services for their transactions. Additionally, a peep into international trade, one would realise that the use of ships is being employed as a dominant choice of means of transportation for cargo owners due to some advantages and these include a vessel being more spacious compared to any other means of transportation, its reliability, quality of service, packaging, safety and insurance among others, despite its advantageous position emphasis is gradually turning more on multi modalism with the sea transport stage constituting the major part of the entire transport chain.

Shipping is today a high profile international business involving huge vessels, sophisticated technology, management and operations. It accounts for the transportation of well over ninety per cent of world trade in volume terms. It is also a major contributor towards the creation and development of global wealth. As such, shipping, as a business is not only key but indeed central to human existence and international commerce between nations.

It is important to note that the type of cargoes to be shipped will determine the type of vessel to be used because there are different types of vessels. In the past one basic type of vessel carried all manner of cargoes but nowadays, vessels are specially built for certain trades, they include among others:
 Reefer vessels for carrying frozen foods(meat or fish) and refrigerated cargoes such as fruit
 Pure car and truck carriers (PCTC) vessels
 Car and lorry traffic (RoRo or Roll on- Roll off) vessels
 Liquefied Natural Gas (LNG) carriers
 New cars and/or trucks(known as pure car carriers [PCC])
 Vessels designed to carry bitumen
 Vessels designed to carry bulk cargoes like ores, coal, grain, sugar, fertilizer
 General cargo ships sometimes called Breakbulk carriers

The above list is not exhaustive but it shows that there are different types of vessels built and used for the carriage of different cargo. Some of these vessels are used in liner trades as container ships and some as general multi-purpose liner vessels. Other vessels are used in the purely tramp trades and are wholly or part-chartered for bulk or large break-bulk (i.e packaged) cargoes.

Foluke Akinmoladun is the Managing Solicitor of Trizon Law Chambers Nigeria. She is a lawyer, accountant, mediator and arbitrator. Her work experience covers both domestic and international commercial legal matters and she belongs to the panel of neutrals of numerous arbitral institutions. She was a onetime Director General of the African Ship owners Association of Nigeria and is a member of the Presidential National Action Committee on Nigeria’s Implementation of the African Continental Free Trade Agreement (AfCFTA) (Transportation stream). She is also the secretary of the Lagos Chamber of Commerce (LCCI) Maritime Sector. She can be reached at: [email protected]

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