SALEFORM 2025 – The Future Standard Form for the Sale and Purchase of Ships

The new SALEFORM 2025 modernises the well established SALEFORM 2012, reflecting the need to align ship sale and purchase transactions with today’s market practice, digital closings and heightened compliance and sanctions realities

Most of us in the shipping industry are familiar with the SALEFORM 2012, which is a widely used standard form contract for the sale and purchase of ships. However, since 2012, both market practice and the regulatory landscape have evolved significantly. The newly launched SALEFORM 2025 updates and modernises the structure and mechanics of SALEFORM 2012 to reflect how transactions are commonly conducted today, while also responding to heightened compliance expectations and geopolitical uncertainty.

Together with other industry participants, Nordisk Defence Club has participated in the Norwegian committee established by the Norwegian Shipbrokers’ Association and the subsequent BIMCO committee that have prepared and adopted SALEFORM 2025. 

Key Updates from SALEFORM 2012

The key updates include the following, and some selected topics are addressed in more detail below:

• Modernised payment and closing mechanics to reflect common market alternatives.
• Increased focus on KYC, including an optional exit if KYC is not cleared within an agreed timeline.
• A new alternative allowing a vessel to be purchased without any physical inspection (commonly used in bareboat charterparties and purchase options).
• Updated regulatory provisions to reflect new operational realities, including EU ETS and FuelEU Maritime.
• A comprehensive sanctions framework reflecting geopolitical developments.
• General drafting clarifications and usability improvements across the form.

Modernised Transaction Mechanics and KYC

A key objective of SALEFORM 2025 is to capture transaction mechanics that parties routinely adopt in practice and incorporate them into the standard form, thereby reducing the need for bespoke clauses.

Payment and Escrow Structures

SALEFORM 2025 formalises the use of escrow structures for payment of the deposit and, where relevant, the balance payment of the purchase price. The payment clause now contains standard alternatives reflecting common settlement methods. The default remains a familiar delivery-based settlement structure, but parties can elect mechanisms, such as pre-funding the balance to an escrow agent or conditional SWIFT payments held to the buyer’s order pending release.

Closing mechanisms

SALEFORM 2025 also updates the closing mechanics to reflect modern closing practices in the industry, including virtual closings and electronic exchange of documents (originals to follow where required). The revised form helps reduce the need for letters of undertaking by including the specific obligation in the contract itself. 

KYC and Anti-Money Laundering

KYC and anti-money laundering documentation is given increased attention in SALEFORM 2025, reflecting the reality that escrow agents, banks and financiers typically require increasingly robust documentation both at the deposit stage and at the closing stage. The deposit clause also includes an optional mechanism allowing a party that has provided all required KYC documentation to the escrow agent to terminate if the other party’s KYC is not confirmed within an agreed timeline.

Regulatory Updates and Compliance Protections

Since 2012, the regulatory and compliance landscape for ship sale and purchase has evolved significantly. Climate and emissions related regimes have become increasingly relevant to vessel operations and, in turn, to sale and purchase transactions. 

In parallel, compliance expectations and enforcement risks have intensified, particularly in relation to sanctions and anti-bribery and corruption. SALEFORM 2025 responds by introducing clearer contractual protections and workable mechanisms for situations where compliance issues arise. 

EU ETS and FuelEU Maritime

The revised form includes dedicated provisions aimed at clarifying responsibilities, allocation of risk and information handover in relation to the EU Emissions Trading System (EU ETS) and FuelEU Maritime, with a view to reducing the scope for post-delivery disputes.

Sanctions

To ensure that the standard form remains functional in an increasingly complex sanctions environment, SALEFORM 2025 introduces a comprehensive sanctions clause. The clause is designed to allocate risk through warranties and clear contractual consequences, and to confirm that neither party is required to do anything under the contract that would expose it to sanctions.  Furthermore, the buyer’s contractual warranties remain in force after delivery with the aim of preventing vessels from being flipped to sanctioned entities or dark fleet actors.

 Anti-Bribery and Corruption 

SALEFORM 2025 also introduces a new anti-bribery and corruption (“ABC”) clause requiring compliance with applicable ABC laws, supported by contractual protections – including an indemnity and a termination right – where a counterparty’s breach creates regulatory exposure for the compliant party.

A Practical Reminder: Pre-Signing Due Diligence Remains Essential

Contractual KYC and sanctions clauses are not a substitute for robust pre-signing due diligence. Before signing a contract, parties should continue to thoroughly assess counterparties, the vessel, and the transaction – including sanctions risks and any 'dark fleet' indicators like concerns relating to a vessel’s ownership, control, trading patterns, and post-delivery plans.  SALEFORM 2025 provides important contractual protection, but it cannot mitigate a heightened-risk transaction on its own - early diligence remains the first and most effective safeguard.

Closing Remarks

SALEFORM 2025 builds on the strong and well-tested foundations of SALEFORM 2012. The overall structure and core commercial balance of the standard form remain largely unchanged. The revisions in SALEFORM 2025 are therefore targeted and practical, focusing on areas where market practice and the legal landscape have moved on since 2012. For that reason, SALEFORM 2025 is now recommended for use as the default standard form for new ship sale and purchase transactions.

Nordisk is available to assist members with queries relating to SALEFORM 2025, including negotiation support and practical guidance on sanctions and other compliance considerations in sale and purchase transactions.,