Charter Agreement Template for England and Wales

A Charter Agreement sets out the terms for leasing or hiring a vessel, aircraft, or other major asset for a specific period or purpose. It's a legally binding contract that spells out who's responsible for what - from operational costs and maintenance to insurance and crew management.

Under English maritime and aviation law, these agreements protect both the owner and charterer by clearly defining payment terms, usage rights, and liability limits. Common in shipping and private aviation, Charter Agreements can range from simple single-trip arrangements to complex long-term commercial deals. They're especially important for businesses needing flexible access to transport without the commitment of ownership.

Consider using a Charter Agreement when you need temporary access to expensive assets like ships, aircraft, or specialized equipment without buying them outright. This agreement becomes essential for time-sensitive projects, seasonal operations, or when testing new business routes before making long-term commitments.

A Charter Agreement makes particular sense for UK businesses expanding into new markets, managing peak demand periods, or replacing equipment during maintenance. It provides legal protection while keeping capital free for other investments. Maritime and aviation companies often use these agreements to maximize fleet flexibility and meet specific client demands without the burden of permanent ownership.

• Time Charter: Used for fixed-period vessel or aircraft hire, giving operational control while the owner maintains ownership and crew management
• Voyage Charter: Covers specific trips or routes, with the owner handling all operational aspects and costs
• Bareboat Charter: Transfers full operational control to the charterer, who manages crew and operations while the owner retains ownership
• Demise Charter: Similar to bareboat but includes more extensive transfer of responsibilities and liabilities to the charterer
• Slot Charter: Common in container shipping, allowing charterers to book specific cargo spaces rather than entire vessels

• Asset Owners: Companies or individuals who own vessels, aircraft, or equipment and lease them out under Charter Agreements for revenue
• Charterers: Businesses needing temporary use of assets, from shipping companies to event organizers and tour operators
• Maritime Lawyers: Draft and review agreements, ensuring compliance with UK maritime law and international conventions
• Insurance Providers: Offer coverage specific to charter operations and assess risk levels
• Ship Brokers: Act as intermediaries, connecting owners with potential charterers and helping negotiate terms

• Asset Details: Gather complete specifications of the vessel or aircraft, including registration numbers, capacity, and technical requirements
• Duration Planning: Define exact charter period, including start date, end date, and any extension options
• Cost Structure: Calculate all fees, including charter rates, fuel costs, maintenance charges, and insurance premiums
• Operational Terms: Outline responsibilities for crew, maintenance, repairs, and operational control
• Compliance Check: Verify all necessary permits, certificates, and insurance requirements under UK maritime or aviation laws

• Party Details: Full legal names and addresses of both owner and charterer, including registration numbers for companies
• Asset Description: Detailed specifications of the chartered vessel or aircraft, including registration and certification details
• Charter Period: Clear start and end dates, including delivery and redelivery terms
• Payment Terms: Charter rates, payment schedule, and additional costs like fuel, maintenance, or insurance
• Operational Control: Specific responsibilities for crew management, maintenance, and operational decisions
• Liability Clauses: Risk allocation, insurance requirements, and indemnification provisions
• Governing Law: Explicit statement choosing English law and jurisdiction for dispute resolution

A Charter Agreement differs significantly from a Business Acquisition Agreement in both purpose and duration. While both involve valuable assets, they serve fundamentally different business needs.

• Ownership Transfer: Charter Agreements temporarily transfer use rights while maintaining original ownership; Business Acquisition Agreements permanently transfer all ownership rights and responsibilities
• Duration: Charter Agreements typically cover specific time periods or voyages; Business Acquisition Agreements represent permanent, one-time transactions
• Scope of Control: Charter Agreements focus on operational control and usage terms; Business Acquisition Agreements address complete business transfer, including assets, liabilities, and intellectual property
• Financial Structure: Charter Agreements involve recurring payments for use; Business Acquisition Agreements usually involve a single purchase price with possible earn-out provisions