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Government issues directions to Major port to not levy penalties, demurrage, charges, fee to port users owing to delay because of lockdown

The Government of India vide its order dated 31st March, 2020 bearing order no. PD-14300/4/2020-PD VII issued guidelines to Major Ports on below two aspects: -

I. Exemptions/Remission on penalties etc.

The Government in its order said that given the nation-wide lockdown, there is an inevitable impact in the form of delays in evacuation of cargo and inability to fulfill obligations by various parties/stakeholders due to the effect on the downstream services.

In view of the situation arising because of the lock down and after considering the representations received from various shareholders, Major port are directed that –
  • They shall ensure no penalties, demurrage, charges, fee, rentals are levied on any port user (traders, shipping lines, concessionaires, licensees, etc.) for any delay in berthing, loading/unloading operations or evacuation/arrival of cargo by the reasons attributable to lockdown measures from 22nd March to 14th April, 2020.
ii. Issue relating to Force Majeure

The Ministry clarified that spread of corona virus should be considered a case of natural calamity and Force Majeure may be invoked.

In view of the situation arising because of the COVID-19 pandemic and after considering the representations received from various stakeholders, Major ports are directed that-
  • The period for completion of any Project under implementation in PPP mode or otherwise, can be extended by ports.
  • For existing and operational PPP projects, the Major ports can permit waiver of all penal consequences on a case to case basis along with deferment of performance obligations as per relevant provisions of Concession  Agreement.
  • The period of Force Majeure starts from the date of order of Ministry of Finance referred above and will end when the competent authority so orders.
Government order

DGS Order No. 08 of 2020
Order no. PD-14300/4/2020-PD VII

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