This Client Alert discusses the recent amendments to the Grain and Feed Trade Association (“GAFTA”) Arbitration Rule No. 125 (“GAFTA 125”) and GAFTA 49 and the practical implications of each. The time bar for ‘Amounts Payable’ claims has now been removed from GAFTA 125. When determining the applicable time bar, all claims are now to be judged based on parity of contract. The express obligation for sellers to have cargo ready at any time during the agreed delivery period from GAFTA 49. This has the practical effect of leaving the sellers with the obligation to supply at ‘Buyers’ Call’ which is not a condition of the contract. Buyers’ do not have the right to terminate the contract if sellers breach this obligation.
Time limits for bringing claims in commodity arbitration are often relatively short. It is important to be able to identify what time limit applies to your claim, which has been difficult to do in certain circumstances.
The latest version of GAFTA 125 applicable to contracts entered into after 1 September 2018 no longer contains the contentious Rule 2.3, which set a time bar of 60-consecutive days for bringing claims for ‘amounts payable’.
Furthermore, GAFTA 49 has been amended so that there is no longer an express obligation on the sellers to have cargo ready for delivery at any time during the agreed delivery period.