Institute of Chartered Shipbrokers, Hong Kong branch, and the Indian Maritime University and supported by a number of industry bodies, co-organised a webinar on ‘English Law & hedging losses: Guidance for commercial professionals’ on 16th June. The panellist included legal and commercial professionals with domain expertise.

The session witnessed Mr Alessio La Rosa, Global Head Freight, COFCO International, Geneva; Mr Iain Sharp, Partner, Hill Dickinson; Ms Sarah Hunt, Partner, HFW; Capt SR Patnaik, CEO, International Shipping & Logistics Fze, Dubai( Tata group), Mr Pryderi Diebschlag and chaired by Mr Jagmeet Makkar, Chairman, Institute of Chartered Shipbrokers, HK, IMEI Chair etc.

The English courts have traditionally been reluctant to hold that hedging losses are recoverable on the basis of principles of causation and remoteness. In recent years, case law has started to develop clarifying how the English Court will take into account hedging losses when assessing recoverable damages.

“We have an absolutely fantastic panel with experts from the commercial field as well as from the legal field and basically look at the commercial as well as the legal aspects hedging,” said Mr Makkar while introducing the speakers. There are always some issues revolving around hedging. In the session, the panellists discussed, how they do this risk management in their companies and what are the issues that come out of it.

“It is important to have risk hedging as one of your main activities in doing business now. Risk hedging is a very broad subject, you can either do a physical hedge or a paper hedge,” said Capt Patnaik.

He further added that hedging has to be done correctly you cannot have a little knowledge about hedging mechanism and then get into doing hedging, whereby a person tends to lose more money in hedging than what would you have lost in physical.

“Element of causation now the second important legal concept when proving to hedge,” stated Ms. Hunt.

In certain circumstances, hedging losses may be recoverable and hedging gains may need to be offset against damages claims. There may also be circumstances in which a party is expected to hedge in mitigation of its losses, although it is perhaps a step too far to suggest that a failure to hedge will mean that losses are not recoverable on the basis that they are not caused by the breach.

Several questions were raised by Mr Makkar regarding English law, for which the Mr Diebschlag and Mr Rosa answered through their expertise. This offbeat session on Hedging losses and English Law gained the attention of many shippers around the globe.

While summing up the session Mr Makkar promised to come back with more such webinars on unique topics.

Marex Media