Dispute Resolution Mechanism Under The Merchant Shipping Act, 2025

1. INTRODUCTION

India’s maritime sector stands at a historic turning point. On 15^th March, 2026, the Merchant Shipping Act, 2025 (“MSA, 2025”)¹ came into force, repealing the Merchant Shipping Act, 1958, a law framed in the final years of British rule and amended 18 times over six decades. This landmark legislation is the centrepiece of a comprehensive maritime reform package designed to realise the Maritime India Vision 2030 (MIV 2030), the government’s blueprint of over 150 initiatives aimed at positioning India among the world’s top maritime nations².

MSA, 2025 seeks to build a modern, efficient, and self-reliant shipping industry that strengthens the goal of Aatmanirbhar Bharat. By aligning domestic rules with global standards, it addresses long-standing gaps in safety, environmental protection, seafarer welfare, and ease of doing business.

The reform goes far beyond a single law. In 2025, Parliament enacted a suite of five interlinked statutes that together overhaul the entire maritime ecosystem:

• The Merchant Shipping Act, 2025: Modernising vessel registration, ownership, liability, and dispute resolution.( Enforced on 15^th March, 2026)³
• The Coastal Shipping Act, 2025: Promoting domestic trade by removing licensing barriers for Indian-flagged vessels and introducing strategic planning. (Not enforced)
• The Carriage of Goods by Sea Act, 2025: Updating carrier liabilities and adopting contemporary international rules such as the Hague-Visby Rules. (Enforced on 10^th September, 2025)
• The Bills of Lading Act, 2025: Modernising documentation, including legal recognition of electronic bills of lading. (Enforced on 10^th September, 2025)
• The Indian Ports Act, 2025: Replacing the colonial-era 1908 Act with improved governance, transparent tariffs, stronger pollution controls, and faster dispute mechanisms. (Not enforced)

Collectively, these laws aim to enhance India’s global competitiveness, reduce logistics costs, and unlock the full potential of the Blue Economy.

At its heart, the MSA, 2025 delivers much-needed simplification. It condenses the sprawling 561 sections of the 1958 Act into a lean structure of 16 Parts and 325 sections, eliminating redundancies while incorporating India’s obligations under major international conventions, from SOLAS⁴ and MARPOL⁵ to the Maritime Labour Convention⁶ (“MLC”) and the Nairobi Wreck Removal Convention⁷.

India is the world’s 16^th-largest maritime nation, with a 7,500-kilometre coastline and a network of 12 major ports and over 200 minor and intermediate ports. These facilities handle 95% of the country’s trade by volume and approximately 70% by value. In FY 2024-25, major ports alone moved 855 million tonnes of cargo, an increase of 4.3% over the previous year⁸ and its ship-recycling industry, led by the world’s largest yard at Alang, Gujrat, commands roughly 30% of the global market. Despite the above, India still ranks 38^th in the World Bank’s Logistics Performance Index 2023⁹. This demonstrated a clear need for shift from colonial-era regulation to a future-ready framework that will power India’s rise as a global maritime powerhouse and a key driver of national development.

The MSA, 2025 introduces several significant structural modifications to India’s maritime legal architecture. Most notably, the Act carves out a dedicated chapter on “Limitation of Liability for Maritime Claims,” implementing India’s obligations under the Convention on Limitation of Liability for Maritime Claims, 1976 (LLMC, 1976). The new framework expands the ambit of limitation by extending its application to a broader range of claims, including those arising from wreck removal and harbour clearance operations, thereby aligning India more closely with contemporary international practice. At the same time, it preserves well-established exceptions, such as claims arising from personal injury to seafarers or loss of life, ensuring that the protective intent of the limitation regime is not diluted.

Against this backdrop, this article examines the dispute resolution mechanisms introduced under the MSA, 2025. The necessity of such an examination is twofold. First, effective dispute resolution is the cornerstone of commercial confidence in any maritime jurisdiction; without it, even the most progressive substantive rights remain unenforced. Second, India’s ambition to emerge as a leading maritime nation under Maritime India Vision 2030 depends critically on how swiftly and fairly disputes are resolved. A modern, credible, and internationally aligned dispute resolution framework is therefore not merely a procedural detail but a strategic imperative.

2. DISPUTE RESOLUTION MECHANISM UNDER THE NEW LAW:

MSA, 2025 marks a decisive shift in resolution of the maritime disputes in India. Where the 1958 Act relied on a fragmented, largely court-centric system, piecemeal handling of seafarer wage and condition disputes, High Court adjudication for collisions and salvage, and limited administrative roles, the new law establishes a structured, modern, and seafarer-centric framework.

At its core, the MSA, 2025 prioritises speedy resolution, adherence to the principles of natural justice, and alignment with the MLC. It creates a sui generis regime for maritime employment disputes, and introduces a clear multi-tiered mechanism tailored to the unique demands of the shipping industry.

The characterisation of the MSA, 2025’s employment dispute regime as sui generis is significant and deliberate. Maritime employment disputes have historically occupied an uncomfortable middle ground — too specialised for ordinary civil courts, yet distinct from industrial disputes governed by the Industrial Disputes Act, 1947. The 1958 Act never resolved this tension satisfactorily, leaving seafarers to navigate overlapping jurisdictions. The MSA, 2025 breaks with this tradition by establishing a self-contained, occupation-specific dispute resolution architecture. It treats the seafarer’s grievance not as a subspecies of industrial labour conflict, but as a distinctly maritime matter requiring expertise in shipping law, international conventions, and the practical realities of life at sea. It is this conceptual reorientation, from generic labour protection to specialised maritime justice, that distinguishes the new framework and provides the foundation for the institutions examined below.

The Act introduces three key institutions:

1. THE SHIPPING MASTER

The Shipping Master, appointed at Shipping Offices established by the Central Government¹⁰ serves as the primary authority for resolving day-to-day disputes at the port level. The Master hears and decides disputes between the master, ship owner (or agent) and any seafarer arising under the employment agreement¹¹ after giving both parties an opportunity to be heard.

The Master thereafter passes the award in the dispute within 30 days (additional 30 days allowed)¹² which is conclusive as to the rights of the parties and enforceable as a decree of a civil court under the Code of Civil Procedure, 1908 (“CPC”)¹³. The Arbitration and Conciliation Act, 1996 does not apply to proceedings before the Shipping Master¹⁴.

For disputes involving foreign seafarers on foreign-registered vessels in Indian waters, the Shipping Master has the power to forward the complaint to the competent authority of the flag State, with a copy to the Director-General, International Labour Organisation Office¹⁵.

Notably, MSA, 2025 provides no statutory appeal from the Shipping Master’s award. It is final at the administrative level, though future rules by the Central Government may introduce additional mechanisms.

2. THE CENTRAL TRIBUNAL

At the core of the MSA 2025, lies a fresh approach to handling conflicts in the maritime workforce. The Act sets up a dedicated Maritime Tribunal to settle employment disputes between seafarers and shipowners¹⁶. This creates a focused system for the sector, one that aligns with the MLC, and its guidelines for fair and timely resolutions. By channelling these matters into a single, specialized body, the law cuts through the old patchwork of rules and builds trust in India’s shipping industry.

The jurisdiction of the Central Tribunal must be understood in contrast to that of the Shipping Master. The Shipping Master operates as a first-instance, port-level authority with jurisdiction over disputes arising under individual employment agreements particularly, claim-specific disputes between a named seafarer and a named employer regarding wages, conditions, or terms of engagement. Its jurisdiction is transactional, triggered by a concrete dispute under a concluded contract. The Central Tribunal, by contrast, exercises broader appellate and adjudicatory authority over collective and systemic employment disputes between seafarers as a class and shipowners. Its mandate extends to setting conditions of service, resolving disputes that are industry-wide in character, and issuing awards that bind the sector as a whole. In this respect, the Tribunal functions more like a specialised labour adjudicator for the maritime workforce, whereas the Shipping Master is akin to a contractual arbitrator with summary powers. This demarcation is critical to prevent forum-shopping and to ensure that the layered architecture of the MSA, 2025 operates coherently.

The Central Government constituted the Tribunal, consisting of one or more members with knowledge and experience in the maritime issues¹⁷. This keeps decisions grounded in real-world expertise, away from the delays of general courts.

(i) Procedural Flexibility

Further, to stay flexible, the Tribunal skips the procedural steps of the CPC and provisions of the Bharatiya Sakshya Adhiniyam, 2023¹⁸. Instead, it shapes its own rules, drawing on powers enshrined upon the civil courts under the CPC for summoning witnesses and compelling production of document, examination of the witnesses¹⁹. The aim is to ensure expeditious hearings without unnecessary delays.

(ii) Restriction on Legal Representation

What truly sets this apart is the limit on legal practitioners. The parties cannot be represented by the legal practitioners except with the consent of the other party or with the leave of the Court²⁰. It is a push to curtail the adversarial delays and promote collaborative resolutions, although this provision may amplify the structural power disparities between seafarers and shipowners, risking procedural fairness.

(iii) Award, Enforcement, and Executive Oversight

Hence, once the dispute is decided, the Tribunal passes a reasoned Award which is submitted to the Central Government for official publication. It becomes enforceable as a civil decree after thirty days of its publication²¹. The Central Government has the power to annul or modify the award, adding what the legislature evidently intended as a built-in check for a layer of oversight, keeping outcomes balanced and accountable²².

3. STREAMLINED ADMINISTRATIVE AND ARBITRAL PATHWAYS FOR SALVAGE AND MARITIME CLAIMS

Apart from the Seafarer’s Dispute Resolution Methods, the MSA, 2025 also suggests a robust tapestry of dispute resolution options tailored to the maritime sector’s unique needs ranging from administrative appeals, judicial interventions by Magistrates and High Courts, arbitration for salvage matters, and executive determinations by the Director-General or Central Government, designed for international disputes, maritime casualties, claims for declaring limited liability, and salvage disputes. Some of these mechanisms are discussed hereunder:

A. Appeals Against Certificate Withdrawals or Suspensions:-

For seafarers or officers facing revocation of their certificates of competency or proficiency, the MSA, 2025, carves out a straightforward appellate route. Under Section 48(7) of the MSA, 2025, anyone hit with a withdrawal, suspension, or cancellation by the issuing authority can appeal to a designated officer notified by the Central Government. This mechanism safeguards professional livelihoods, allowing quick reinstatement if errors are found, and aligns with the Standards of Training, Certification and Watchkeeping Convention, 1978²³.

B. Adjudication of Liability Limitation and Pollution Claims:-

The MSA, 2025 vests primary authority in High Courts or the Central Government for equitable distribution. For claims under the Limitation of Liability for Maritime Claims Convention, 1976²⁴, Section 169(2) directs the High Court to adjudicate full claim amounts while declaring liability limits, preserving claimants’ rights to pursue other assets if needed.

C. Arbitration and High Court Oversight in Salvage Operations

Salvage disputes have always required careful calibration. The law must reward genuine rescue efforts while also guarding against inflated or strategic claims. The new framework reflects this balance by introducing a tiered method of dispute resolution that encourages settlement but retains judicial supervision where required.

Section 256 places an initial obligation on the Director General to facilitate an amicable settlement between the shipowner and the salvor in accordance with the prescribed procedure. The intent is evident. Salvage claims often arise in urgent operational circumstances and are better resolved on a commercial footing rather than through prolonged litigation. If such efforts do not succeed, Section 257(1) provides that disputes will be resolved through arbitration where the parties are bound by an arbitration clause. In practice, this will apply to most modern salvage arrangements, which commonly operate on standard form contractual terms. In the absence of an arbitration agreement, or in situations involving competing claims by multiple salvors, the High Court assumes jurisdiction under sub section (3). The statute also preserves appellate remedies before the High Court in accordance with applicable procedural law. It further permits interim orders to secure reasonable provisional payments so that salvors are not left uncompensated during the pendency of proceedings.

D. Judicial Recovery of Unpaid Wages

When seafarers go unpaid, the Act empowers swift civil enforcement through magistrates, bypassing lengthy litigation. Section 86(1) lets a seafarer or an authorized representative file a summary application before a Judicial Magistrate First Class for outstanding wages.

Further, the MSA, 2025 provided that Central Government officers can also initiate these under Section 86(2). To prevent forum-shopping, Section 87 bars civil court suits except in narrow cases like insolvency or vessel arrests, funnelling matters to this streamlined judicial track. Meanwhile, Section 88 extends parallel remedies to masters for their disbursements, treating them akin to seafarer liens.

Hence, together, these pathways form a ladder of recourse, from administrative nudges to High Court finality. They not only resolve conflicts but propel India’s maritime edge, cutting logistics drags and honouring global pacts. Yet, as with any framework, their success hinges on clear rules and vigilant oversight.

4. CONCLUSION

In conclusion, the MSA, 2025 marks a decisive shift in India’s maritime governance by introducing a streamlined, specialised, and internationally aligned dispute resolution framework. By reducing procedural delays, minimising multi-jurisdictional uncertainty, and establishing clear liability caps, it significantly aims to shorten resolution timelines and ensures faster distribution of funds when compared to the protracted backlog of traditional courts. This structural efficiency strengthens commercial certainty and enhances stakeholder confidence in the maritime sector.

The decriminalisation of minor offences, mandatory transparency in shipping-related charges (with penalties extending up to ₹5 lakh for non-disclosure), and the empowerment of the Director-General of Maritime Administration to take executive decisions, particularly in matters such as wreck management, collectively reduce regulatory friction. These reforms meaningfully advance the “ease of doing business” agenda and aligns India closely with the digitalisation and investor-oriented objectives envisioned under Maritime India Vision 2030 (MIV 2030).

Footnotes

1. Merchant Shipping Act, 2025, No. 24 of 2025, (India), Chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://www.indiacode.nic.in/bitstream/123456789/22147/1/2025-24.pdf

2. Ministry of Ports, Shipping and Waterways, Government of India, Maritime India Vision 2030 (2021), https://sagarmala.gov.in/sites/default/files/MIV%202030%20Report.pdf

3. Press Information Bureau, Government of India, Cabinet approves the Merchant Shipping Bill, 2024 (Feb. 14, 2024), https://www.pib.gov.in/PressReleasePage.aspx?PRID=2227673&reg=3&lang=2

4. International Maritime Organization, International Convention for the Safety of Life at Sea (SOLAS), 1974, https://www.imo.org/en/about/conventions/pages/international-convention-for-the-safety-of-life-at-sea-(solas),-1974.aspx

5. International Maritime Organization, International Convention for the Prevention of Pollution from Ships (MARPOL), https://www.imo.org/en/about/conventions/pages/international-convention-for-the-prevention-of-pollution-from-ships-(marpol).aspx

6. International Labour Organization, Maritime Labour Convention, 2006, https://www.ilo.org/international-labour-standards/maritime-labour-convention-2006

7. International Maritime Organization, Nairobi International Convention on the Removal of Wrecks, 2007, https://www.imo.org/en/about/conventions/pages/nairobi-international-convention-on-the-removal-of-wrecks.aspx

8. Press Information Bureau, Government of India, Maritime India: From Vision 2030 to Amrit Kaal 2047 1 (Oct. 26, 2025), https://static.pib.gov.in/WriteReadData/specificdocs/documents/2025/oct/doc20251026676201.pdf

9. Press Information Bureau, Government of India, India Ranks 38 out of 139 Countries on World Bank’s Logistics Performance Index Report 2023; India’s Rank Has Improved by Sixteen Places from 54 in 2014 (Feb. 7, 2024), https://www.pib.gov.in/PressReleasePage.aspx?PRID=2003541&reg=3&lang=2

10. Merchant Shipping Act, 2025, No. 24 of 2025, § 3(61) and § 12, (India).

11.Merchant Shipping Act, 2025, No. 24 of 2025, § 58(1)(d), (India).

12. Merchant Shipping Act, 2025, No. 24 of 2025, § 83(3), (India).

13. Merchant Shipping Act, 2025, No. 24 of 2025, § 83(4), (India).

14. Merchant Shipping Act, 2025, No. 24 of 2025, § 83(5), (India).

15. Merchant Shipping Act, 2025, No. 24 of 2025, § 58(1)(e), (India).

16. Merchant Shipping Act, 2025, No. 24 of 2025, § 89, (India).

17. Merchant Shipping Act, 2025, No. 24 of 2025, § 89(1), (India).

18. Merchant Shipping Act, 2025, No. 24 of 2025, § 89(2) and (3), (India).

19. Merchant Shipping Act, 2025, No. 24 of 2025, § 89(4), (India).

20. Merchant Shipping Act, 2025, No. 24 of 2025, § 89(6), (India).

21. Merchant Shipping Act, 2025, No. 24 of 2025, § 89(7), (India).

22. Merchant Shipping Act, 2025, No. 24 of 2025, § 89(8), (India).

23. Merchant Shipping Act, 2025, No. 24 of 2025, § 48 (1), (7), (3), (India).

24. International Maritime Organization, Convention on Limitation of Liability for Maritime Claims (LLMC), https://www.imo.org/en/about/conventions/pages/convention-on-limitation-of-liability-for-maritime-claims-(llmc).aspx

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