Commercial Code

Once a carrier receives goods from a shipper based on a contract for the carriage of goods in a general ship (meaning a transportation contract intended for individual packages of goods; hereinafter the same applies in this Section), the carrier must load the goods onto the ship and stow them.

If a shipper neglects to deliver goods, the master may cause the ship to depart immediately. In this case, the shipper must pay the full amount of freight charges (if a carrier receives freight charges for other goods in place of those goods, the amount of such freight charges is deducted).

A shipper must deliver the documents necessary for transportation to the master within the loading period.

A carrier is liable to compensate for loss or damage arising as a result of loss of, damage to, or delay in the arrival of goods which is caused by the following things having been done insufficiently as of the time of the ship's departure; provided, however, that this does not apply if the carrier proves that it did not neglect to exercise due care in doing those things as of that time:

making the ship seaworthy;

properly manning, equipping, and supplying the ship; and

making the holds, refrigerating and cool chambers, and all other parts of the ship in which goods are carried, fit and safe for their receipt, carriage and preservation.

Any special agreement that makes the carrier subject to a release from or reduction in the liability to compensate for loss or damage under the provisions of the preceding paragraph is void.

A carrier, at any time, may discharge goods that have been loaded onto the ship in violation of laws and regulations or not in accordance with a contract for the carriage of goods in a general ship, and may abandon these goods if they are likely to harm the ship or other cargo.

If a carrier has transported cargo provided for in the preceding paragraph, it may claim the maximum amount of freight charges for the same type of goods at the place and time of loading.

The provisions of the preceding two paragraphs do not preclude a carrier or other interested person from claiming compensation against a shipper for loss or damage.

Once a consignee receives goods, the consignee bears the obligation to pay the total sum of the following amounts (hereinafter referred to as the "freight charges and other receivables" in this Section) to the carrier, in accordance with the purport of the contract for the carriage of goods in a general ship or bill of lading:

the amount of freight charges, ancillary costs, and money advanced; and

the amount of salvage charges and the amount of general average contribution payable in proportion to the value of the goods.

A carrier may retain goods until it receives payment for the freight charges and other receivables.

Even after a carrier delivers goods to a consignee, the carrier may put the goods up for auction in order to receive payment for the freight charges and other receivables; provided, however, that this does not apply if a third party acquires possession of the goods.

Before the departure of a ship, a shipper may cancel a contract for the carriage of goods in a general ship by paying the full amount of freight charges; provided, however, that if the amount of damage caused to a carrier due to the cancellation of a contract for the carriage of goods in a general ship falls below the full amount of freight charges, it is sufficient for the shipper to compensate for that damage.

If the goods have been fully or partially loaded onto a ship, the provisions of the preceding paragraph apply only if the shipper obtains consent from all other shippers and the charterer. In this case, the shipper must bear the costs incurred for loading and discharging the goods.

Even if a shipper cancels a contract for the carriage of goods in a general ship pursuant to the provisions of the preceding Article, the shipper is not entitled to be released from the obligation to pay the carrier ancillary costs and money advanced.

After the departure of a ship, a shipper may not cancel a contract for the carriage of goods in a general ship unless the shipper obtains consent from all other shippers and the charterer, and either pays the total sum of the amount of freight charges and other receivables and the amount of damage that will arise from the discharge of goods or provides reasonable security.

A carrier may claim the full amount of freight charges even if the master uses cargo for the voyage pursuant to the provisions of Article 712, paragraph (1).

The provisions of this Section apply mutatis mutandis to transportation of goods by ships used exclusively for navigation in water areas other than seas, such as lakes, rivers, ports, and harbors, for the purpose of conducting commercial transactions (excluding a ship's tender or a boat steered solely or mainly using oars or paddles; hereinafter referred to as "non-seagoing vessels" in this Part).

Once the preparations necessary for loading goods onto a ship have been completed based on a voyage charter contract (meaning a transportation contract that covers the whole or part of a ship; hereinafter the same applies in this Section), the master must issue notice of this to the charterer without delay.

If the period of loading is specified but the time of its commencement is not specified in a voyage charter contract, that period is counted from the day on which the notice referred to in the preceding paragraph is issued. In this case, the period of loading does not include any period during which the loading of goods is impeded due to force majeure.

If the charterer loads goods onto the ship after the period of loading has passed, the carrier may claim reasonable demurrage even if there is no special agreement to that effect.

If the master is to receive goods from a third party but the identity of the third party cannot be ascertained or the third party does not load goods onto the ship, the master must immediately issue notice of this to the charterer.

In the case referred to in the preceding paragraph, the charterer may load goods onto the ship only within the loading period.

A charterer may lodge a request with the master for the ship to depart even if the charterer has not loaded all of the goods onto the ship.

If a charterer lodges a request as referred to in the preceding paragraph, the charterer bears the duty to pay the carrier the full amount of freight charges and any costs arising from the fact that not all of the goods are loaded onto the ship, and must provide reasonable security for the payment of these costs if requested to do so by the carrier.

After the loading period has passed, the master may immediately cause the ship to depart even if the charterer has not loaded all of the goods onto the ship. In this case, the provisions of paragraph (2) of the preceding Article apply mutatis mutandis.

Once the preparations necessary for discharging goods from a ship have been completed, the master must notify the consignee of this without delay.

If a voyage charter contract prescribes a discharge period but does not prescribe the time of its commencement, the discharge period is counted from the time at which the consignee is notified as referred to in the preceding paragraph. In this case, the discharge period does not include any period during which the discharge of goods is impeded due to force majeure.

If the consignee discharges goods after the discharge period has passed, the carrier may claim reasonable demurrage even if there is no special agreement to that effect.

Before the departure of a ship, a charterer under a full charter contract (meaning a voyage charter contract that covers the whole of a ship; hereinafter the same applies in this Section) may cancel the full charter contract by paying the full amount of freight charges and demurrage; provided, however, that if the amount of damage caused to a carrier due to the cancellation of a full charter contract falls below the full amount of freight charges and demurrage, it is sufficient for the charterer to compensate for the damage.

If a charterer cancels the full charter contract pursuant to the provisions of the preceding paragraph after goods have been loaded onto the ship in whole or in part, the charterer bears the costs of loading and discharging the goods.

If a charterer under a full charter contract fails to load goods onto the ship during the period for loading, the carrier may deem that the charterer has cancelled the full charter contract.

After the departure of a ship, a charterer under a full charter contract may not cancel the full charter contract unless the charterer pays the total sum prescribed in Article 745 and demurrage or provides reasonable security.

The provisions of Article 743, Article 745 and Article 753, paragraph (3) apply mutatis mutandis to the cancellation of a voyage charter contract whose subject is a part of a ship. In this case, the phrase "the full amount of freight charges" in Article 743, paragraph (1) is deemed to be replaced with "the full amount of freight charges and demurrage", and the phrase "total sum of the amount of freight charges and other receivables and the amount of damage that will arise from the discharge of goods" in Article 745 is deemed to be replaced with "total sum of the amount of freight charges and other receivables and the amount of damage that will arise from the discharge of goods, and demurrage".