SECTION II. Vessel (Ship).

Chapter 3. Detention (Arrest) of Vessel.

Clause 41. Authority for Vessel's Detention.

A vessel may be arrested or released from arrest only by decision of Court, Arbitration or Chairman of the Marine Arbitration Commission.

Vessel's arrest means any detention or limitation of her movements; it is effected to ensure the implementation of marine demands (claims) listed in Clause 42 of this Code, during the vessel's stay in a sea port of Ukraine.

Vessel's arrest does not constitute a measure taken on decision of the Court or Arbitration, even if such decisions have come into force.

The rights of Court, Arbitration or Marine Arbitration Commission to effect an arrest of the vessel in compliance with the first part of this Clause shall not limit the right of Harbour Master and Captain of the port to arrest (detain) the vessels in accordance with procedure indicated in Clauses 80-82 and 91 of this Code.

Clause 42. Marine Claims (Demands).

A vessel may be arrested (detained) only on marine claim (demand). Marine claim means a demand arising out of the right of property and other economic rights of the vessel, building the vessel, management, operation or commercial use of the vessel, mortgaging the vessel or taking actions connected with vessel's salvage, and in particular, a demand (claim) in connection with:

1. inflicting damage or losses as a result of damage to or loss of property caused by vessel's operation;
2. inflicting damage or losses as a result of death or impairing one's health on land or at sea connected with vessel's operation;
3. causing damage to the environment;
4. salvage remuneration or observance of the requirements of any salvage agreements;
5. remuneration and other sums which have to be paid for preventing or an attempt to prevent possible damage or losses as well as taking appropriate precautions therefore or performing similar operation;
6. raising, removal or demolition of the vessel that has turned into rumble and wreckage or the cargo of said vessel, and expenses incurred therewith;
7. any agreement of using or freighting vessel;
8. any agreement of carrying cargo or the passengers by the vessel;
9. loss of or damage to cargo, including baggage, during the carriage or in connection therewith;
10. general average;
11. pilotage and payment of pilotage dues;
12. towage;
13. supplying the victuals, disposable materials, fuel oil, supplies, equipment and appliances, including containers, for operating the vessel or her maintenance;
14. building, repairing, rebuilding or refitting the vessel;
15. the dues in port, channel and other navigable waters as well as in dock;
16. the wages and other financial means which are in possession of the Master, officers and crew in connection with fulfilling their duties on board the vessel, including the expenses on repatriation and social security installments which are paid in their name;
17. disbursements which are paid on account, of the vessel by her Master, Owner, Charterer or agent;
18. insurance premium, including mutual in durance installments, which are paid on account of the vessel by her Owner or character on the bare-boat charter;
19. any selling, broker's or agent's commission which is paid on account of the vessel by her Owner or Charterers on the bareboat charter;
20. any dispute among two or more Proprietors/ Owners of the vessel on the issues of using her and profit allotment;
21. mortgaging the vessel;
22. any dispute arising on the issue of the agreement of the purchase and selling the vessel.

Clause 43. Sufficient Conditions for Vessel's Arrest (Detention).

A vessel in respect whereof the marine demands have arisen may be arrested only upon at least one of the following conditions:

• a) a demand referring to the category of privileged claims in accordance with items 1,2,3-5 and 7 of Clause 359 of this Code;
• b) a demand based upon the vessel's registered mortgage;
• c) a demand referring to the rights of vessel ownership;
• d) a demand not indicated in sub items a), b) and c) of this Clause, and referring to the person (entity) that is the vessel's owner by the moment of origination of said demand and is responsible on this demand by the moment of a procedure connected with vessel's arrest.

Charterer of the vessel on bareboat charterer contract is liable on said demand and is the vessel's charer or her owner by the moment of a procedure connected with vessel's arrest.

Any vessel or vessels may be arrested if by the moment of arrest procedure origination they are in possession of a person liable on marine demand who is the proprietor/owner of the vessel to which said demand was put forward, or her charterer on bare-boat, time or voyage charter basis.

This rule shall not concern the demands of the right of vessel ownership or proprietorship.

Clause 44. Releasing a Vessel from Arrest (Detention).

The detained vessel shall be released from arrest upon providing a security for said marine demand, it being acceptable in form and sufficient in amount.

Upon disagreement of the parties on the form and amount of security for said demand, the Court, Arbitration or Marine Arbitration Commission shall determine the form and amount of security, the latter not exceeding the value of the vessel.

Any request of releasing the vessel from the arrest upon satisfying the requirements of a maritime demand shall not mean admitting liability, refusal from means of defense or the right of limiting liability.

A person who has secured a marine demand in accordance with part 1 of this Clause may at any time appeal to the Court or Marine Arbitration Commission for decreasing, changing or cancelling further security.

Clause 45. Subsequent Detention (Arrest).

The vessel that has been under arrest and released from arrest or in relation to which a security to a marine demand has been already provided, may be arrested on the same marine demand upon existence of at least one of the following conditions:

• a) the amount of security to the same marine demand received earlier is insufficient, though total amount of security to said demand shall not exceed the value of a vessel;
• b) the person who provided the security to a marine demand is not able to fulfill his obligations in part or completely;
• c) the vessel that had been under arrest and provided a security to a marine demand, was released on request or by consent of a person who brought the demand, given sufficient grounds;
• d) the person who had brought the demand, was not able to take all necessary measures to prevent releasing the vessel from arrest.

Any vessel arrested on placement of the same marine demand shall not be arrested if:

• a) amount of security to a demand (already received) is not insufficient, or;
• b) rules contained in items b) and c) of this Clause of the first part of this Clause do not apply to the illegal release of vessel from arrest.

Clause 46. Protection of the Interests of Vessel's Proprietor/Owner or Charterer on Bareboat Charter.

The person upon the demand of whom the vessel has been arrested, is liable for any losses inflicted on vessel's proprietor/owner or charterer on bare-boat charter basis as a result of unjustified arrest of the vessel or providing excessive security to a marine demand.

The Court,' Arbitration or Chairman of Marine Arbitration Commission may, as a condition of vessel's arrest or continuation of said arrest imposed earlier, request the person who had placed a demand to this effect, to provide a security on said demand in amount and on conditions determined by the Court or Marine Arbitration Commission in connection with any losses that may be inflicted on the vessel's proprietor/owner or charterer on bareboat charter basis as a result of unsubstantiated arrest or excessive security to marine demand, said person may be held liable therefore.

Clause 47. Arrest of Vessels in State Ownership.

The rules of this Chapter apply also to vessels that are in state ownership and are engaged in commercial activities only.