Reduced claim over blocked Suez still 'exceptionally large'

11 May 2021

The insurer of the ship that blocked the Suez Canal in March has said a reduced compensation claim to allow it to be freed is still too high.

The ship’s insurer, UK Club, said the reduced claim for almost $600m made by the Egyptian authorities to free the vessel and cover related losses was “exceptionally large”.

The Suez Canal Authority (SCA) adjusted its original claim of $916m to settle out of court, SCA chairman and managing director Osama Rabie told private TV network MBC Masr, according to Reuters.

The ship, which blocked the canal for six days, is being held during the ongoing dispute about compensation between the SCA and the ship’s Japanese owner Shoei Kisen Kaisha.

This latest development follows a ruling by an Egyptian court last week rejecting an appeal made by the owners of the Ever Given against the arrest of the ship and its cargo.

The court upheld its original order that the vessel and its cargo can only be released from arrest after the owner pays SCA its full claim, which at the time was $916m. The court said the vessel could not be released based on security for the claim being provided. The Ever Given’s owners have until 20 May 2021 to appeal the decision.

The operator of the Ever Given said last month that it was exploring the possibility of treating the vessel and its cargo separately.

Rabie said that there was no immediate prospect of a settlement, according to Reuters.

“We haven’t seen any response from their side so far, so we are moving forward with the issue, as we were, in the court,” he said.

UK Club said the reduced amount proposed had not been reflected in SCA’s claim filed at court.

“The Ever Given’s owners still have not been provided with evidence that would support a claim of this size, which remains exceptionally large. The Ever Given’s interests continue to negotiate in good faith with the SCA,” it said.

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