“Right of First Refusal ( RoFR)” means whenever a tendering process is undertaken to charter a vessel, a bidder offering a ship built in India will be given the first priority to match the lowest bidder (L1) quote.
The RoFR would be exercised only in case the vessel being offered for charter by the lowest bidder (L1) has been built outside India. For any bidder to exercise RoFR, his bid should be within the Margin of Purchase Preference, which will be 20% of L1.
Significance
In a move towards incentivising ship-building activity in the country, the Ministry of Shipping has revised its guidelines for chartering of ships by providing Right of First Refusal (RoFR) to ships built in India.
This is expected that this priority given to ships built in India will raise the demand for such vessels, providing them with additional market access and will give a boost to “Make in India”.
