The Baltic Exchange announced it will launch an Escrow Service for its members to hold deposits for ship sale transactions.
The paid-for service will be available from May 2018 for use in transactions where the buyer of the vessel is a Baltic Exchange member. The service will cost $5,000 per side and is likely to be extended to disputes related payments, the Baltic Exchange said.
The Escrow Service will be run by the Baltic Exchange's Asia office in Singapore and will be subject to the Singapore Exchange's (SGX) compliance and money laundering procedures. OCBC Bank will provide the joint deposit account.
The service will initially be offered from Singapore with a view to further expansion to other Asian shipping centers. It will be headed up by the Baltic Exchange's Head of Asia-Pacific, Chris Jones, a sale & purchase broker with more than 40 years of experience.
“Having the Baltic Exchange provide this service solves the problem as to where the deposit should be held in a vessel transaction,” Jones said. “Buyer and seller alike can be certain that the Baltic Exchange will apply its high standards of compliance as well as have a full understanding of the complexities of any maritime transaction.”
“This service will add real value to the many sale & purchase brokers who are Baltic members and are currently expected to provide this service to clients. It will allow them to undertake the highest level of due diligence and compliance checks, reduce the administrative burden of organizing a client escrow account and allow them to focus on adding value to the transaction.”
