Profit-sharing clause

A profit-sharing clause splits voyage or trading profit between owner and charterer above an agreed baseline, aligning their interests on a time charter or in a pooling arrangement. The clause defines the revenue and cost items, the threshold above which sharing starts, and the split, often 50/50 of the surplus over the base hire. Owners use it to capture upside in a rising market without giving up the security of fixed hire, while charterers keep a share of the gains from good trading. It overlaps with pool distribution mechanics, where vessel earnings are aggregated and shared on points.