What is a bareboat (demise) charter and how does it differ from a time charter?

• A. A bareboat charter transfers control and operation of the vessel to the charterer; the owner provides hull and crew minimal supervision; time charter leaves operations with the owner.
• B. A bareboat charter includes full crew management by the owner.
• C. Bareboat is a type of sale.
• D. Bareboat requires the ship's hull to be scrapped at end.

Answer: (A)

The idea being tested is who controls and operates the vessel under different charter types. In a bareboat (demise) charter, the charterer takes possession and full responsibility for the vessel’s operation for the charter period. They arrange and pay for the crew, plan voyages, and handle day-to-day running of the ship, using the hull and equipment provided by the owner. The owner’s role is limited to delivering the vessel and providing basic, ongoing support with only minimal supervision. This setup makes the charterer function like the temporary operator or "owner" for the term.

In contrast, a time charter keeps operating control with the owner. The charterer pays hire to use the vessel but does not run its day-to-day operations; the owner provides the crew and handles routine management, while the charterer directs voyage instructions within the charter terms. The distinction is that, in bareboat, the charterer controls and operates the ship, whereas in a time charter the owner remains responsible for the vessel’s operation.

So, the described arrangement best reflects that transfer of control and responsibility in a bareboat charter, versus the owner retaining operational control in a time charter.