What Rescue Fees Are
Interlink編集部What Salvage Charges Are
Salvage charges refer to the remuneration paid to salvors or salvage contractors who carry out salvage operations when a vessel or cargo encounters a maritime casualty.
In English, this concept may also be described as salvage remuneration, salvage award, or salvage reward, especially in legal, contractual, or arbitration contexts. In this article, the main running term is salvage charges.
During maritime transport, if dangers such as grounding, fire, flooding, engine failure, drifting, collision, or sinking occur, salvors, tug companies, other vessels, or specialized operators may save the vessel or cargo. The payment arising from these salvage activities is called salvage charges.
Salvage charges are not simply a settlement of labor time or actual expenses. They are assessed by considering the value of the salvaged property, the degree of danger, the difficulty of the salvage operation, the result achieved, the skill and effort of the salvors, and contributions to preventing environmental pollution.
What is significant in actual logistics practice is that salvage charges are not only an issue for the shipowner. They may also impose a burden on the owners of the salvaged cargo. Even if the cargo is undamaged, if the salvage activity preserves the cargo's value, salvage charges and the provision of security may also become relevant for the cargo side.
Scope Covered in This Article
| Theme Covered | Main Content | Practical Points to Confirm |
|---|---|---|
| Basics of salvage charges | Meaning of remuneration paid to salvors for maritime salvage | Confirm that this is different from ordinary towage fees or labor costs. |
| Situations where salvage charges arise | Grounding, fire, flooding, drifting, collision, risk of environmental pollution, and similar casualties | Confirm whether the incident involves maritime salvage, not just an ordinary cargo accident. |
| No cure, no pay | Concept where the salvor’s remuneration depends on successful salvage | Cannot be judged simply if SCOPIC clauses or special compensation are involved. |
| Allocation of burden | Relationships between shipowners, cargo owners, freight interests, and cargo insurers | Cargo owners may be affected even if they did not sign the salvage contract. |
| Difference from General Average | Difference between salvage charges and general average contributions, Salvage Security, and General Average Guarantees | Even if arising from the same maritime casualty, submission destinations and security documents may differ. |
| Relation with cargo insurance | Salvage charge security, General Average Guarantees, payment of contributions, and insurer response | Even if insured, notification to the insurer and submission of necessary documents are required. |
| Subrogation claims | Possibility of insurers seeking recovery from responsible parties after payment | Keep accident records, B/L, Survey Report, and notification documents. |
Situations When Salvage Charges Become an Issue
Salvage charges become an issue not in regular cargo accidents but when a vessel or cargo faces a serious maritime casualty.
| Scenario | Example of Salvage Operation | Impact on Cargo Side | Documents to Check |
|---|---|---|---|
| Grounding | Operations to refloat, towage, relocation to safe waters | Liability for salvage charges or general average contributions may become an issue. | Accident notices, LOF notices, Salvage Security demands |
| Fire | Firefighting, cooling, towage, movement to a port of refuge | Wet damage from firefighting, salvage charge security, and delays in cargo delivery may become issues. | Survey Report, photographs, General Average Declaration |
| Flooding | Water pumping, sinking prevention, hull stabilization | Cargo damage, Survey Report, and liability for salvage charges may become issues. | Accident reports, inspection records, notifications to insurers |
| Engine failure / drifting | Towage, evacuation to a safe port | Towage costs might be treated as salvage charges or general average. | Shipping company notifications, refuge port expense details, B/L clauses |
| Collision | Salvage of vessel or cargo, towage, port handling | Shipowner liability, general average, salvage charges, and cargo damage can simultaneously become issues. | Accident reports, opposing vessel information, shipping company notices |
| Risk of environmental pollution | Oil pollution prevention, hazard containment, hull stabilization | SCOPIC clauses, P&I Club involvement, and special compensation may become relevant. | P&I Club notifications, SCOPIC notices, salvor communications |
Salvage Charges Are Not Just Labor Costs
Salvage charges are not simply determined by hourly rates or actual expenses like ordinary towage fees or labor costs.
Salvors commit personnel, tugs, equipment, fuel, and specialized knowledge to save vessels or cargo in dangerous situations. Salvage operations can involve risks to the salvors themselves, equipment damage, liability exposure, and measures to prevent environmental pollution.
Therefore, salvage charges are comprehensively assessed by considering the value of the salvaged property and the nature of the salvage operation.
| Decisive Factor | Details | Impact on Salvage Charges |
|---|---|---|
| Value of salvaged property | Value of the vessel, cargo, or other salvaged property | It influences the upper limit and sharing structure of salvage charges. |
| Degree of danger | Severity of risks such as sinking, fire, grounding, oil contamination, or navigation hazards | The greater the danger, the higher the potential valuation of the salvage operation. |
| Success of salvage | Extent to which the vessel or cargo was saved | Greater salvage success impacts the evaluation of the remuneration. |
| Skills and efforts of the salvors | Specialized skills, judgment, manpower involved, and tasks performed | Advanced skills and difficult operations are considered in the assessment. |
| Time and costs incurred in salvage | Duration of work, use of tugs and equipment, fuel, on-site expenses, and similar items | Forms part of the basis for evaluating salvage charges. |
| Risks assumed by the salvors | Risks to life, vessel, equipment, and liability | An important factor in salvage involving significant danger. |
| Contribution to pollution prevention | Prevention of oil spills, containment of hazardous material leaks, and prevention of environmental damage expansion | May relate to SCOPIC clauses and P&I Club responses. |
The Concept of No cure, no pay
The traditional basis of salvage remuneration includes the concept called No cure, no pay.
No cure, no pay means that salvors receive remuneration only if the salvage is successful. Traditionally, if salvors’ efforts do not save the vessel or cargo at all, they are less likely to be rewarded.
However, in modern salvage practice, issues such as pollution prevention and special compensation clauses like SCOPIC may arise. Therefore, it is not always possible to make a simple judgment based solely on No cure, no pay.
| Outcome | No cure, no pay Concept | Practical Notes |
|---|---|---|
| Salvage successful | Salvors may be entitled to salvage remuneration. | Cargo parties may also be liable to contribute to salvage charges or provide security. |
| Salvage unsuccessful | Traditionally, salvage remuneration is less likely to be recognized. | SCOPIC clauses or special compensation issues may arise. |
| When pollution prevention measures are taken | Activities may not be fully valued based only on salvaged property value. | Confirmation of P&I Club involvement and SCOPIC clauses may be necessary. |
Who Bears the Cost of Salvage Charges?
Salvage charges may be borne by parties related to the salvaged property.
In maritime transport, salvage may benefit vessels, cargo, freight, and other interests. For this reason, salvage charges are not purely an issue for shipowners but may also involve cargo owners.
| Stakeholders | Reason for Bearing Responsibility | Related Documents / Procedures | Practical Notes |
|---|---|---|---|
| Shipowners / Shipping Companies | Because the vessel benefits from the salvage. | Salvage contract, LOF, P&I Club procedures | Even contracts signed on the ship side can affect the cargo side. |
| Cargo Owners / Shippers | Because the cargo was salvaged and its value preserved. | Salvage Security, salvage guarantee letters, Cargo Value Declaration, insurance policy | Security or guarantees may be requested even if the cargo is undamaged. |
| Freight-related parties | Because freight may be treated as benefiting from salvage. | B/L, freight statements, transport contracts | Confirm whether freight is subject to cost sharing. |
| Cargo insurance companies | Because insurance contracts may cover salvage charges or general average contributions. | Insurance policies, guarantee letters, security provision, claim payments | Early notification to insurers and submission of required documents are critical. |
Even if cargo owners did not directly sign salvage contracts, they may be asked to bear salvage charges or provide security in proportion to the value of the salvaged cargo. This can be a difficult point for shippers to understand.
Differences Between Salvage Charges and General Average
Salvage charges and general average are often confused but are not the same.
Salvage charges are remuneration paid to those who carry out the salvage operation. General average is a system in which losses or expenditures incurred to avoid common danger are shared among the interests of the saved vessel, cargo, freight, and others involved.
| Item | Salvage Charges | General Average | Practical Notes |
|---|---|---|---|
| Nature | Remuneration paid to salvors or salvage contractors. | A system for sharing sacrifices and expenses to avoid common danger. | The nature differs even when arising from the same incident. |
| Main counterparties | Salvors, salvage contractors, or their representatives. | Shipping companies, general average adjusters. | Confirm submission destinations and communication channels separately. |
| Supporting documents | Salvage Security, guarantee for salvage charges. | General Average Bond, Cargo Value Declaration, deposit. | Submitting a General Average Bond may still leave salvage charge security outstanding. |
| Impact on cargo side | Security or payment concerns arise based on the salvaged cargo value. | General average contribution issues arise based on the salvaged cargo value. | Issues may arise even if the cargo is undamaged in both cases. |
| Points of attention | Security requests may arrive before the declaration of general average. | General average documents may be required separately from salvage charge security. | Manage salvage charges and general average separately. |
Salvage charges may be organized as general average and included in the cargo side’s general average contributions. However, salvage charges themselves and general average contributions may have different submission destinations, security documents, and settlement routes, so they need to be checked separately.
Salvage Charges and LOF
In salvage operations, the salvage contract can be an issue. International salvage practice often uses a standard salvage contract format called LOF, or Lloyd’s Open Form.
Under LOF, salvage operations begin first, and salvage remuneration is sometimes determined later through negotiation or arbitration. Therefore, at the time of the incident, the final salvage charge may be unknown, and the cargo side may be required to provide Salvage Security.
| Item | Relation to Salvage Charges | Practical Checks |
|---|---|---|
| LOF | A representative salvage contract format where salvage remuneration is decided afterward. | Check if LOF is being used through shipping company or P&I Club notices. |
| No cure, no pay | Basic principle that remuneration is considered only if salvage is successful. | Confirm whether a SCOPIC clause or special compensation applies. |
| SCOPIC Clause | Clause relevant where environmental pollution prevention or special compensation is an issue. | Check involvement of P&I Club and special compensation instructions. |
| P&I Club | May be involved in shipowner’s liability, salvage, and environmental pollution response. | Confirm notifications and security instructions from the P&I Club. |
Details of LOF and SCOPIC are appropriately checked in articles covering salvage contracts and LOF. This article focuses on the occurrence of salvage charges and their impact on the cargo side.
Cargo Delivery and Providing Security
When salvage charges become an issue, cargo delivery may require security provision beforehand.
The final amount of salvage charges might not be finalized immediately after the incident. Therefore, salvage service providers may request security to ensure future payment of salvage charges as a condition before releasing the cargo.
| Security / Documents | Subject | Submission Destination | Notes |
|---|---|---|---|
| Salvage Security | Salvage charges | Salvage service provider or their representative | May be requested separately from General Average Bonds. |
| Salvage Charge Guarantee | Salvage charges | Salvage service provider or their representative | Insurance companies may be involved. |
| General Average Bond | General average contribution | Shipping company or general average adjuster | Different submission destination from salvage charge security. |
| Cargo Value Declaration | Value confirmation for salvage charges and general average | Salvage service provider, general average adjuster, insurance company, or other relevant party | Consistency check with invoice, freight, and insurance premium is necessary. |
Delays in providing security may affect D/O exchange, CFS cargo removal, cargo delivery, and delivery schedules, potentially leading to additional costs such as storage fees, Demurrage, and Detention.
Relationship with Cargo Insurance
In ocean marine cargo insurance, salvage charges and general average contributions can become insurance issues.
If marine cargo insurance is in place, the insurer may be involved in handling salvage charge guarantees, responding to Salvage Security, issuing General Average Guarantees, and paying contributions based on the policy terms.
If cargo insurance is not held, the shipper may need to handle deposits, bank guarantees, Salvage Security, and general average contributions themselves.
| Insurance Status | Practical Handling | Impact on Cargo Owner | Points to Note |
|---|---|---|---|
| With cargo insurance | The insurance company may respond to salvage guarantees and General Average Guarantees. | It may be possible to avoid cash collateral, facilitating cargo delivery. | Notification of the incident and submission of required documents to the insurance company are necessary. |
| No cargo insurance | The cargo owner must handle collateral, deposits, bank guarantees, or final payment themselves. | Financial burden, internal approvals, and delays in cargo delivery tend to become issues. | Confirm collateral amount, payment deadlines, and internal approvals promptly. |
| Insufficient insurance amount or conditions | Confirm the insurer’s coverage scope and any uninsured portions. | The cargo owner may have to bear part of the cost. | Check insured value, deductible, and uninsured portions. |
Relation to Subrogation Claims
When the cargo insurance company pays salvage charges, general average contributions, or cargo damage claims, it may seek reimbursement from the carrier, shipping line, or liable parties on behalf of the cargo owner. This is called subrogation.
Salvage charges themselves may be treated as fair remuneration to salvors, but if the accident was caused by carrier responsibility, unseaworthiness, or management issues, the insurance company may consider claiming reimbursement after payment.
| Situation | Relation to Subrogation Claims | Cargo Owner / Forwarder Actions | Documents to Keep |
|---|---|---|---|
| Insurance company paid salvage charges | Depending on accident cause, the insurer may consider claims against responsible parties. | Preserve accident notifications, B/L, photos, and information from the shipping line. | Accident notification, B/L, Salvage Security demands |
| Insurance company paid general average contributions | If unseaworthiness or carrier liability is an issue, it may become a target for claims. | Keep General Average Adjustment Statements, declarations, and Survey Reports. | General Average Declaration, General Average Adjustment Statement, Survey Report |
| There is cargo damage | Separate subrogation processing is needed for cargo damage and for salvage or general average. | Secure Survey Reports, inspection records, and delivery records. | Photos, inspection records, damage details, delivery records |
| Cargo owner settled or agreed to waiver unilaterally | This may affect the insurer’s subrogation rights. | Confirm with the insurance company before waiving liability or agreeing to exemption. | Settlement drafts, waiver consent forms, email records |
When salvage charges arise, expediting cargo delivery is important, but it is also crucial to keep records necessary for later claims. Accident notices, B/Ls, insurance policies, general average documents, Salvage Security demands, and Survey Reports should be retained.
Practical Workflow
The basic flow when salvage charges become an issue is as follows.
| Step | What to Confirm | Points to Note | Parties Involved |
|---|---|---|---|
| 1. Notification of marine accident | Confirm details such as grounding, fire, flooding, collision, drifting, or similar casualties. | Check if this is an accident involving salvage charges rather than a usual cargo incident. | Shipping line, overseas agent, NVOCC |
| 2. Confirmation of salvage operation | Confirm the salvor or salvage contractor, salvage contract, and whether LOF exists. | Check for guidance from the shipping line or P&I Club. | Shipping line, P&I Club, salvor's representative |
| 3. Checking Salvage Security | Verify whether the salvors are requesting security. | May be required separately from General Average Guarantees. | Salvor's representative, insurance company, cargo owner |
| 4. Confirming General Average Declaration | Verify whether a General Average Declaration has been issued. | Salvage charges may be handled as part of general average. | Shipping line, general average adjuster |
| 5. Cargo insurance confirmation | Check if cargo owner has insurance, and contact insurance company or agent. | Even if insured, coverage handling is not automatic. | Cargo owner, insurance company, insurance agent |
| 6. Preparation of required documents | Gather B/L, Invoice, Packing List, insurance policy, Cargo Value Declaration, and related documents. | The submission points may differ for salvage and general average matters. | Cargo owner, customs agent, insurance company |
| 7. Confirmation of cargo delivery | Check D/O exchange, cargo removal, storage fees, Demurrage, and Detention. | Without submitted security, cargo delivery may be halted. | Shipping line, CFS, customs broker |
| 8. Subsequent settlement and claims management | Verify finalized salvage charges, general average adjustment, insurance company action, and claim possibilities. | Keep records even after cargo delivery. | Insurance company, general average adjuster, salvor's representative |
Scope of Forwarder and NVOCC Involvement
Freight forwarders and NVOCCs are not in a position to determine the final validity of salvage charges or legal liabilities. However, they are deeply involved in organizing accident information, contacting the cargo owner and insurance company, collecting required documents, confirming security submission status, and verifying cargo delivery conditions.
| Category | What can be easily supported | What should not be conclusively decided | Practical response |
|---|---|---|---|
| Sharing accident information | Sharing vessel name, B/L number, accident details, and shipping company notices with the cargo owner | Final judgment on accident causes or responsibilities | Accurately forward received information and keep records. |
| Confirmation of salvors | Organizing which salvors, salvage contractors, or agents are involved | Judging the reasonableness or final amount of salvage charges | Share information from the salvage side with the insurance company. |
| Salvage Security confirmation | Organizing whether security is required, the submission destination, deadline, and necessary documents | Legal judgment on whether or not to provide security | Share the request details with the cargo owner and insurance company, and track the response status. |
| General Average handling | Organizing notices of General Average Declaration, General Average Bonds, and Cargo Value Declarations | Judgment on the reasonableness or final amount of General Average contributions | Manage salvage charges and General Average items in separate lists. |
| Cargo damage handling | Supporting surveyor arrangements, photos, inspection records, and obtaining Survey Reports | Determination of damage cause or insurability | Follow insurance company instructions and preserve evidence materials. |
| Confirmation of cargo delivery | Checking D/O exchange, CFS pickup, storage charges, Demurrage, and Detention | Explaining that delivery will always occur even if security has not been submitted | Confirm the timing of security non-submission and occurrence of additional charges. |
Decision Checklist
| Situation to Check | Who to Check With | Items to Confirm | Response if Issues Arise |
|---|---|---|---|
| Upon receiving first report of a marine accident | Shipping company, overseas agent, NVOCC | Accident details, vessel name, B/L number, cargo location, presence of salvage operations | Quickly inform cargo owner and insurance company; continue confirming additional information. |
| When receiving information from salvors | Shipping company, P&I Club, salvor's representative | Salvor or salvage contractor name, agents, existence of LOF, whether Salvage Security is requested | Share with the insurance company and confirm the possibility of security for salvage charges. |
| When receiving Salvage Security requests | Salvor's representative, insurance company, cargo owner | Submission destination, deadline, amount, guarantee format, necessary documents | Manage as security separate from General Average Bonds. |
| Upon receiving General Average Declaration | Shipping company, General Average adjusters, insurance company | General Average Bond, Cargo Value Declaration, submission deadline | Do not confuse with salvage charge security; manage separately in a different list. |
| When checking cargo insurance | Cargo owner, insurance company, insurance agents | Whether insurance is in place, insurance terms, insured amount, status of accident notification | If not notified, immediately notify and submit necessary documents. |
| Before cargo delivery | Shipping company, CFS, customs brokers, General Average adjusters | Outstanding security, possibility of D/O exchange, pickup permission, additional charges | Share unresolved issues with cargo owner, insurance company, and related parties. |
Common Trouble Patterns
| Case | Points Prone to Problems | Documents to Check | Practical Response |
|---|---|---|---|
| Cargo owner is confused by salvage charges demanded despite no damage to cargo | They do not understand that charges depend on the value of the salvaged cargo. | Accident notices, Salvage Security requests, B/L | Explain that the fee is remuneration for the benefit of cargo salvage. |
| General Average Bond provided but cargo is not released | Salvage Security has not yet been submitted. | General Average adjuster notices, Salvage Security requests, submission records | Check salvage charge security separately from the General Average Bond. |
| Salvage charge amount unknown at time of accident | LOF may decide salvage remuneration at a later date. | LOF notices, salvor notifications, insurance company notices | Manage security provision and final charge confirmation separately. |
| No insurance and unable to prepare security | No cargo insurance means no guarantee from an insurance company can be used. | Insurance confirmation, security request, internal approval records | Urgently confirm deposit funds, bank guarantees, and internal approvals. |
| Insufficient documentation for insurance claims | Priority on cargo delivery causes accident materials not to be preserved. | Accident notifications, B/L, Survey Reports, Salvage Security requests | Preserve necessary documents for claims and share them with the insurance company. |
| Handling salvage charges and General Average contributions as the same | Submission destinations, security documents, and settlement processes are confused. | Salvor notices, General Average Declarations, adjuster notices | Manage salvage charges and General Average contributions separately in lists. |
| Delayed securing of evidence for cargo damage | Focus on salvage charge security and General Average steps delays confirmation of cargo condition. | Photos, inspection records, Survey Reports, delivery records | Arrange a surveyor and preserve evidence simultaneously with security handling. |
Common Misunderstandings
| Misconception | Correct Understanding | Practical Notes |
|---|---|---|
| Only the shipowner bears salvage charges. | If cargo is salvaged, the cargo owner side may also incur costs. | Confirm whether Salvage Security demands have been issued to the cargo side as well. |
| Salvage charges are irrelevant if the cargo is undamaged. | Even if the cargo is intact, issues around security or cost allocation may arise according to the value of the salvaged benefit. | Check not only for cargo damage but also whether the cargo is subject to salvage. |
| Salvage charges are simply towage or labor fees. | Salvage charges are remuneration determined based on property value, degree of danger, and success of salvage. | Avoid explaining them as regular operational costs. |
| Submitting a General Average Guarantee covers salvage charge issues. | Salvage Security, which covers salvage charges, may be required separately from General Average Guarantees. | Confirm the recipients and the purpose of the security separately. |
| If the insurer pays, subrogation claims are not relevant. | The insurer may consider subrogation claims against the carrier or liable parties after payment. | Keep accident records and Survey Reports properly. |
| Forwarders can judge the appropriateness of salvage charges. | The reasonableness of salvage charges involves the salvage contract, negotiations, arbitration, and expert evaluation. | Coordinate with insurers, P&I Clubs, and experts for verification. |
Points Forwarders and NVOCCs Should Check
| Check Item | Details to Confirm | Who to Check With |
|---|---|---|
| Accident details | Confirm whether the accident involves salvage-related incidents such as grounding, fire, flooding, collision, or drifting. | Shipping lines, overseas agents, NVOCC |
| Salvage contractors | Confirm which salvors, salvage contractors, or agents are involved. | Shipping lines, agents acting for salvage contractors |
| LOF / salvage contract | Confirm whether LOF, or Lloyd’s Open Form, is used and whether there is any notice regarding the salvage contract. | Shipping lines, P&I Club, salvage contractors' agents |
| Salvage Security | Confirm submission recipients, deadlines, and format of salvage charge security. | Salvage contractors' agents, insurers, cargo owners |
| General Average Declaration | Confirm whether salvage charges will be handled as general average. | Shipping lines, general average adjusters |
| Cargo insurance | Confirm whether insurance is in place and communication status with insurer and insurance broker. | Cargo owners, insurers, insurance brokers |
| Required documents | Prepare B/L, Invoice, Packing List, insurance policy, and Cargo Value Declaration. | Cargo owners, customs brokers, insurers |
| Cargo delivery | Check impacts on D/O exchange, CFS removal, storage fees, Demurrage, and Detention. | Shipping lines, CFS, customs brokers |
| Subrogation | Preserve accident materials, Survey Reports, and shipping line notifications. | Insurers, cargo owners, internal management departments |
| Explanation to cargo owner | Explain the reasons salvage charges or security may arise even if the cargo is intact. | Cargo owners, sales personnel, insurers |
Documents to Verify in Practice
- Accident notifications from shipping lines or P&I Clubs
- Salvage Security demands from salvage contractors or their agents
- Notices related to salvage contracts or LOF
- General Average Declaration
- Documents from general average adjusters
- B/L and back clauses
- House B/L and Master B/L
- Invoice
- Packing List
- Cargo Value Declaration
- Insurance policy or certificate of insurance coverage
- General Average Guarantee
- General Average Bond
- Salvage Charge Guarantee
- Survey Report
- Photos, inspection records, damage details
- Correspondence with the insurer
- Instructions relating to cargo delivery approval, storage fees, Demurrage, Detention
Example 1: Salvage Charges Arise Despite No Cargo Damage
Imagine a container ship suffers engine failure during the voyage, creating a drifting hazard and requiring towage by salvage contractors. Although the cargo itself remains undamaged, the salvage operation allows the vessel and cargo to be moved safely to a port of refuge.
In this case, cargo owners may wonder why salvage charges apply if the cargo is safe. However, since the salvage protected the cargo’s value, issues regarding salvage charge security or general average contribution may still affect the cargo side.
Example 2: Delays in Providing Security Due to Uninsured Cargo
After a ship grounds and salvage work is planned to refloat the vessel, the salvage contractors request Salvage Security. Cargo owners with insurance are able to proceed with the security arrangements more quickly with their insurer’s cooperation.
Conversely, cargo owners without cargo insurance must arrange salvage security or deposits themselves, which can take more time for internal approvals and remittance. As a result, cargo delivery may be delayed, causing storage fees and delivery delays.
Example 3: Importance of Document Retention for Subrogation
After the insurer pays salvage charges or general average contributions, if the accident cause involves suspected liability of the carrier, the insurer may consider pursuing subrogation claims.
Without retaining documents such as B/Ls, accident notifications, Survey Reports, photos, General Average Adjustment Statements, and Salvage Security demands, decisions on subrogation claims become difficult. Forwarders and cargo owners should retain accident-related documents even after cargo delivery is completed.
Notes
Salvage charges are remuneration paid to salvors or salvage contractors and differ from normal labor or standard transport fees. They are determined based on the value of the salvaged property, degree of danger, and results of the salvage operation.
Additionally, salvage charges are not only the concern of the shipowner. When cargo is salvaged, the cargo owner may also be subject to salvage security or charges. Even if the cargo is undamaged, the burden may become an issue based on the benefits received from the salvage.
The General Average Guarantee and Salvage Security are separate forms of security. Even if documents related to General Average are submitted, if salvage security is not addressed, cargo delivery may be delayed.
Furthermore, if the cargo insurance company pays salvage charges or General Average contributions, subrogation claims may arise later. Shippers and freight forwarders need to keep accident documentation and related paperwork carefully and avoid hindering the insurance company’s recovery efforts.
Summary
Salvage charges are fees paid to those who save vessels or cargo involved in maritime casualties. These charges are not simply operational costs but are determined based on the value of the salvaged property, the degree of danger, the difficulty of the salvage, the results of the salvage operation, and the contribution to preventing environmental pollution.
Salvage charges are not only the concern of the shipowner but may also involve the owners of the salvaged cargo. Even if the cargo is unharmed, if the salvage operation has preserved the cargo’s value, issues related to salvage security or General Average contributions may arise.
In actual logistics practice, it is important to differentiate between salvage charges, General Average, Salvage Security, General Average Guarantees, marine cargo insurance, and subrogation claims. Freight forwarders and NVOCCs should check notices from shipping companies, P&I Clubs, salvors, General Average adjusters, and cargo insurers, and promptly explain to shippers the necessary paperwork, security arrangements, and impacts on cargo release.
