Ships operate under specific rules of business. One of the terms you most often hear on board is N.O.R. or Notice of Readiness.
This term is normally tossed over when the ship arrives in port either at the anchorage or in berth. I was a cadet back then when I discovered how serious a Notice of Readiness is in the shipping business.
On some occasions, I even discovered how shipowners use the proper timing of NOR to maximize the charter pay!
What is a Notice of Readiness?
An N.O.R or Notice of Readiness is a proclamation made by the Captain of the ship to the charterer, that the vessel is, in all aspects, ready to load or discharge her cargo.
In simpler terms, it is like an announcement, albeit an official one, that the charterer can use the vessel however they see fit in accordance with the charter party.
Why do ships tender a Notice of Readiness?
The purpose of tendering the Notice of Readiness (NOR) is to inform the charterer, the cargo interests (shippers or receivers), and/ or their agents, that the vessel is ready to load and/ or discharge her cargoes.
It is on this notice that the vessel is at the charterer’s disposal whenever they accepted the NOR.
Furthermore, issuing NOR also triggers the calculation of laytime provided that the tendered NOR is valid.
Laytime is the term used for the time allotted to the charterers to load and discharge cargoes in exchange for payment or charter hire.
What is a valid NOR?
NORs are not tendered at the push of a button.
There are certain conditions that the Master must commit before tendering a Notice of Readiness.
Since this document has been the cause of so many legal disputes, shipowners have specific rules on when to issue them.
So before the Ship Master tenders an NOR, the vessel must:
1. Be considered an “arrived ship”.
A ship is considered an arrived ship when she arrives at the customary waiting place of the port nominated in the Charter Party.
The ship may tender the N.O.R. when she waits for her turn to berth.
In particular, the vessel must tender the N.O.R. upon:
- Berthing (all fast), if the vessel proceeds directly to berth.
- Anchoring, either at inner or outer anchorage of the nominated port, awaiting her berthing turn. The correct time of readiness is when the vessel anchors.
- Arrival at a position, even outside the port limits of the nominated port, and receiving instructions from charterers or their agents to tender N.O.R.
2. Be ready in all respects to load and/ or discharge her cargo or cargoes.
If the vessel tenders a premature NOR, i.e., before being in all respects ready, such notice is invalid. The charterer may also consider it as never tendered.
An invalid NOR can never become valid even if it subsequently meets the requirements. The Master must present a new NOR.
3. Satisfy other Charter Party requirements.
These conditions tackle the legal aspect of the vessel’s readiness described in the Charter party agreement.
It involves specific instructions and clearances from third parties such as the port authorities and quarantine officers.
These requirements are the following:
- Have obtained free pratique.
- Cleared by customs.
- Approval from immigration or police
- Tender the N.O.R. within the agreed period of time, e.g., between sunrise and sunset.
In the majority of cases, the Charter Party waives most of these requirements. The vessel can tender N.O.R. upon arrival at anchorage when the designated berth is not ready.
On such occasions, the vessel can tender N.O.R. whether in berth or not (WIBON), whether in port or not (WIPON), whether in Free Practique or not (WIFPON), whether in customs clearance or not (WICCON), etc.
How ships tender a Notice of Readiness
Normally, you can find instructions on tendering of NOR on the terms and conditions of the relevant Charter Party.
However, the owners or the charterers may clearly instruct the vessel when and under what conditions to tender a valid N.O.R.
The objective is to tender the N.O.R. by the quickest, most efficient, and secure means of communications.
Failure or even the slightest delay may cause substantial losses to the owners or delays in commencing cargo operations
NOR tendered outside the times specified by the charterer will not be invalid. They will, however, treat it as delivered during the next working day.
Here are the ways NOR is tendered.
1. Using telex
The N.O.R. must be transmitted by the ship’s fastest means of communication as soon as the vessel meets the conditions earlier above.
2. Via Inmarsat-B
You must obtain the answerback of the called telex number at the commencement and the completion of the transmission.
3. Via Inmarsat-C with Positive Delivery Notification (PDN)
This is to ensure that the message has successfully reached the addressee(s).
PBN is a “store & forward” transmission and the note below the text of a transmission message, “successfully sending message”, means that the message was successfully transmitted to LES (for onward transmission) and not that it was successfully delivered to the final addressee.
4. Using fax message
In some cases, though the originator of the fax receives a successful transmission report, the addressee may have not received a clear copy of the message.
It is advisable that the captain must call the addressee via phone for receipt confirmation of the faxed N.O.R.
5. Using electronic mail message or E-mail
This is the most common and easiest method of tendering a Notice of Readiness. However, there are some drawbacks.
There might be a delay in the arrival of E-mail messages. Worse, it could even be lost. You must call the receiver for receipt confirmation of the NOR.
6. By phone call
The ship can tender the NOR via phone call if there is no other available means of written communication unless the Charter Party provides to the contrary.
The OOW must record such verbal tendering in the ship’s log.
Depending on the Charterer, the Notice of Readiness may be tendered in local time during office hours or from sunrise to sunset.
When the charterer’s agents or representatives accept the NOR, only then that the laytime starts to count.
You have to take care of the time when the NOR is tendered and accepted. Furthermore, you should write them in the ship’s statement of facts (SOF).
In case Shippers/ Receivers insist on another time of acceptance than the correct one, you may lodge a protest for incorrect acceptance of N.O.R. You must insert an appropriate remark in the Statement of Facts.
In circumstances where, there is any doubt about the validity of the tendered N.O.R., or the agents/ charterers/ cargo interests dispute its validity, you must transmit a second N.O.R, as soon as you removed the alleged obstacle the first N.O.R.
The format of the second N.O.R. would be similar to the wording of the first N.O.R.
However, at the end of the text, you must add,
“This Notice is tendered without prejudice to the validity of my Notice of Readiness tendered on (date) at (hours LT).”
That statement indicates that while you are trying to reach a settlement with them, you are not admitting, waiving, or conceding your arguments.
You still establish your position that you are right and they are wrong but for the sake of a commercial deal, you are making concessions.
Again, this is to protect your company against legal actions.
May the winds be in your favor.