FuelEU Maritime directly affects costs, documentation and operational decisions. Since 1 January 2025, the regulation is in force, and its financial consequences permeate the contractual relationship between owners, managers and charterers. The problem: the traditional allocation of responsibilities in charter parties was written for a world without GHG intensity targets.
In a time charter, the charterer typically bears fuel costs and determines the route. The owner provides the vessel and crew. Under FuelEU, however, the owner (as ISM Company) is responsible for compliance – even though they do not control fuel selection. If the charterer bunkers conventional VLSFO and the GHG intensity targets are thereby missed, the owner bears the penalty. This asymmetry demands contractual solutions.
BIMCO has responded by publishing model clauses designed to close this gap. But model clauses are only a starting point – their effectiveness depends on how they are embedded in the respective contractual context and whether both parties understand the practical implications.
Data exchange, fuel information, cost allocation and consequences for non-compliance. The essential regulatory points in detail:
GHG intensity reporting: The charterer must provide the owner with the GHG intensity values of the bunkered fuels – not just sulphur content as before. This includes the well-to-wake certification that must be provided by the fuel supplier. Without this data, the owner cannot calculate FuelEU compliance.
Cost allocation: Who bears the additional cost when alternative fuels with lower GHG intensity are more expensive than conventional VLSFO? The BIMCO clauses provide that the charterer bears the difference when they have the fuel choice. In practice, the calculation is complex because prices, availability and GHG values change dynamically.
Penalty allocation: If GHG intensity targets are not met, the contract must specify who pays the FuelEU penalty. The BIMCO clauses assign the penalty to the charterer if their fuel choice was the cause. But the burden of proof is non-trivial in practice – particularly when multiple charterers use the vessel within a reporting year.
Pooling agreement: If owners or charterers wish to use FuelEU pooling (aggregating compliance balances of multiple vessels), the conditions must be contractually regulated. Who organises the pool? How are over- and under-compliance settled between pool participants? What data must be shared?
Shore power obligation: From 2030, certain vessel types must use shore power in major EU ports. Clauses should regulate who bears the retrofit costs and who pays the berth charges for shore power.
FuelEU also applies to changes of ownership within a reporting period. The reporting year runs from 1 January to 31 December. If a vessel is sold in August, FuelEU obligations for January to August must be attributed to the seller and for September to December to the buyer. The compliance balance must be split proportionally.
In practice this means: the Memorandum of Agreement (MoA) for vessel sales must contain FuelEU-specific clauses. The key points:
Data handover: The seller must provide the buyer with all monitoring data for the period prior to transfer. Without this data, the buyer cannot prepare the year-end emission report.
Compliance status: The MoA should contain a declaration on the FuelEU compliance status at the time of transfer. Is the vessel below or above target? Are there banking or borrowing positions?
Penalty risk: If the vessel has not met the GHG targets at the time of transfer, it must be regulated who bears the proportional penalty. The seller, who operated the vessel during the under-compliance? Or the buyer, who submits the emission report at year-end?
Pooling exit: If the vessel was part of a FuelEU pool, the pool exit upon sale must be organised. The implications for the pool compliance of the remaining participants must be considered.
FuelEU clauses should not be negotiated in isolation from ETS and bunkering strategy. Practical recommendations:
1. Review existing contracts: Analyse all current time-charter and bareboat contracts for FuelEU relevance. Contracts without FuelEU clauses should be supplemented by riders or addenda. This is urgent, not something for later.
2. Use BIMCO clauses as a basis: The BIMCO FuelEU Maritime Clause is a good starting point but must be adapted to the respective contractual context. Cost allocation and penalty risk in particular should be individually assessed for each contract.
3. Think ETS and FuelEU together: A vessel has both ETS and FuelEU obligations. Contractual provisions should cover both regimes to avoid contradictions and gaps. The BIMCO ETS Clause and the FuelEU Clause should be negotiated as a coherent package.
4. Strengthen technical data systems: Contractual compliance depends on data quality. If onboard data (fuel consumption, voyage data, port times) is inaccurate, no clause can secure compliance. Investments in digital noon report systems and automated data validation pay off here.
5. Secure S&P transactions: Include FuelEU data and compliance status in due diligence for every vessel sale. Add FuelEU clauses to the MoA template before negotiation begins – not as an afterthought.
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