INTERIM RULES FOR GENERAL AVERAGE ADJUSTMENT OF THE CHINA COUNCIL FOR THE PROMOTION OF INTERNATIONAL TRADE (KNOWN AS BEIJING RULES FOR ADJUSTMENT, FOR SHORT)

Interim Rules for General Average Adjustment of the China Council for the Promotion of International Trade (Known As Beijing Rules for Adjustment, for Short)

With a view to dealing properly with general average adjustment on the
basis of equality and mutual benefit so as to enhance friendly relations among
peoples of different countries and promote the development of international
trade and marine transport, the China Council for the Promotion of
International Trade has formulated the present Interim Rules and set up the
Department for Average Adjustment.

Article 1 Scope of general average. The following extraordinary loss of
damage and reasonable extra expenses arising from measures properly taken for
relieving a ship, cargo, etc. from common danger caused by natural calamities,
accidents and/or other extraordinary circumstances in marine transport shall
fall within the scope of general average:

1. loss of damage reasonably caused to the ship, cargo, etc. for rescuing
the same from danger;

2. extra expenses incurred by the ship for entering a port of refuge, port
charges recurred during the extra period of the ship's staying in a port of
refuge and extra expenses for the ship's leaving the port of refuge
subsequently with her original cargo;

3. crew's wages and maintenance incurred as well as fuel and stores
consumed during the prolongation of the voyage occasioned by the ship
proceeding to a port of refuge and during the extra period of the ship's stay
in a port of refuge;

4. salvage expenses, expenses for forced discharge and reloading of the
cargo, etc. and other extra expenses.

Where the ship needs repairs for the safe completion of the voyage in
consequence of damage caused by an accident during the voyage, the port
charges, crew's wages and maintenance and fuel and stores necessarily incurred
or consumed during the reasonable period of detention of the ship in the port
of repair, as well as the expenses and loss or damage arising from such
discharging, reloading and handling on board of the cargo, etc. as are
required for the repairs, may under the present circumstances be admitted as
general average.

Where any expense is incurred to save another expense which would have
been admissible in general average, such expense may be allowed in general
average as a substituted expenses. Unless otherwise agreed upon by and between
the ship and cargo interests, the amount so allowable shall not exceed the
amount of the expense saved.

With the exception of loss or damage and expenses referred to in the above
three paragraphs, any other indirect loss, including loss or damage and
expenses through delay, shall not fall within the scope of general average.

Article 2 Principle of adjusting general average. The principle of
general average adjustment is the ascertainment of liability on the basis of
investigation and study and dealing with the compensation for and contribution
to various losses and expenses fairly, reasonably and in a truth-seeking way.

The onus of proof shall be upon the party applying for general average
adjustment as well as the other parties concenred to show that their
respective loss or damage and expenses claimed for are allowable as general
average according to the provisions of the Rules.

If the event giving rise to a claim submitted for adjustment as general
average is due to a fault of one of the parties to the contract of
affreightment, for which he is not entitled to exemption from liability, no
general average adjustment shall be proceeded with, but the case may be
otherwise appropriately dealt with through consultation according to the
circumstances involved.

Article 3 Computation of amount of general average loss or damage. The
amount to be admitted as general average for loss or damage to the ship, cargo
and freight shall be computed on the following basis:

1. The amount allowable for loss or damage to the ship shall be computed
in accordance with the actual reasonable cost of repairing such damage,
including cost of temporary repairs and of replacements subject to reasonable
deductions in respect of "wear and tear". Where no repairs have been effected,
computation shall be made in accordance with the reasonably estimated cost of
necessary repairs. The amount allowable for loss of or damage to fuel and
stores, etc. shall be computed on the basis of their actual values.

2. The amount allowable for loss of or damage to the cargo shall be
computed on the basis of the CIF value, less the freight which would have been
incurred but for such loss or damage. Where the cargo so damaged is sold and
it is impossible to ascertain the extent of the damage, the amount shall be
computed on the basis of the difference between the CIF value and the net
proceeds of sale.

3. The amount allowable for loss of freight shall be computed on the basis
of the freight lost owing to the loss of, or damage to, the cargo, less the
operating costs of the ship, which would have been incurred but for such loss
of damage.

Article 4 Contribution to general average. General average loss or damage
and expenses shall be contributed to by the benefited interests in proportion
to their respective contributory values.

1. The contributory value of the ship shall be computed either in
accordance with the value of the ship in sound condition at the time and place
of the termination of the voyage, less the amount of loss or damage not
allowable in general average, or in accordance with the actual net value of
the ship at the time and place of the termination of the voyage, plus the
amount allowable in general average.

2. The contributory value of the cargo shall be computed on the basis of
the CIF values, less the amount of loss or damage not allowable in general
average and the freight at the risk of the carrier.

Undeclared or falsely declared cargo shall contribute on the actual value,
but loss of or damage to such cargo, if any, shall not be admitted as general
average.

Passengers' luggage and personal effects shall not contribute to general
average except under extraordinary circumstances.

3. The contributory value of the freight shall be computed on the basis of
the freight at the risk of the carrier and subsequently earned, subject to a
deduction corresponding to the extent of the voyage still uncompleted at the
time of the accident giving rise to general average, plus the amount of loss
of freight allowable in general average.

Article 5 Interest and commssion. Interest shall be allowed on general
average loss or damage and expenses at the rate of 7% per annum until the date
of the completion of the general average adjustment.

A commission of 2% shall be allowed on general average expenses other than
crew's wages and maintenance and fuel and stores.

Article 6 General average security. The contributing parties shall, at
the request of the parties concerned, provide a security to ensure the
contribution to general average. Such security may be in the form of a
reliable letter of guarantee or a cash deposit. Where a cash deposit is
provided, the same shall be paid into an account in a bank in the name of the
Department for Average Adjustment unless otherwise agreed upon by and between
the parties concerned. Any use of the cash deposit shall be decided by the
Department for Average Adjustment. The provision, use and refund of the cash
deposit shall be without prejudice to the ultimate liability of the
contributing parties.

Article 7 Time limit of general average. For the purpose of safeguarding
the interests of all parties concerned and completing the adjustment of
general average as promptly as possible, all parties shall, upon the
occurrence of the accident giving rise to general average, do everything
necessary in time and declare general average and provide the Department for
Average Adjustment with relevant materials within the following time limits:

Within 48 hours upon the ship's arrival in the first port after the
accident, if it has occurred at sea; or within 48 hours after the accident, if
it has occurred in a port.

For documentary evidence pertaining to the occurrence of general average
and general average loss or damage, within one month after receipt thereof by
the claiming party, but all materials shall in any case be provided within one
year of the completion of the voyage.

In case of extraordinary circumstances the above time limits may be
appropriately extended, provided a reason for extension has been given within
the respective time limits to the Department For Average Adjustment and its
approval obtained.

In case of failure to observe the above stipulations on the part of any of
the parties concerned, the Department for Average Adjustment may either
decline to proceed with adjustment or adjust the case on the basis of the
materials in its possession.

Article 8 Simplification of adjustment of general average. With a view to
lightening the burden of all parties concerned and improving working
efficiency, the adjustment of general average shall be made as simple as
possible; unduly complicated procedures and calculations shall be avoided;
adjustment shall be made as clear and concise as possible and easy to execute.

For cases in which the amount involved is small, adjustment may be
dispensed with if consent has been obtained from the principal parties
concerned.

Category	ARBITRATION	Organ of Promulgation	The China Council for the Promotion of International Trade	Status of Effect	In Force
Date of Promulgation	1975-01-01	Effective Date	1975-01-01

Laws of the People's Republic of China

INTERIM RULES FOR GENERAL AVERAGE ADJUSTMENT OF THE CHINA COUNCIL FOR THE PROMOTION OF INTERNATIONAL TRADE (KNOWN AS BEIJING RULES FOR ADJUSTMENT, FOR SHORT)