Particular concerns with regard to the Rotterdam ides

Background The application of the Convention Approximately six months ago with a view to pointing out concerns with the Whereas the Hague Visby Rules apply Rotterdam Rules before the signing to carriage by sea and contain a few ceremony held in Rotterdam on 23 exceptions, e.g. , (not September 2009, six of us produced a surprisingly, as these are contracts of paper and circulated it worldwide. The hire as opposed to contracts of carriage) threshold for this Convention coming the Rotterdam Rules are designed to into force is set fairly low with apply to a transport contract that ratifications by only 20 countries needed involves sea carriage in whole or in part. out of about 195 countries worldwide. To The exemptions are wide under Article 6 date only 21 have signed and it remains and Article 80. Again charterparties are to be seen whether any of these 21 will excluded from application, but of more ratify by making the Convention law in concern is the fact that particular types their respective countries. It may well be of trade are exempted or have the power that those 21 who signed are looking to take steps to achieve exemption. Non over their shoulders and wondering liner transportation is exempted in the where the signatures of the rest of the main. The volume contract exemption is world are; and, whether they will be of particular concern and is dealt with entered. later on in this paper. Suffice it to say here that the exemption is effectively a Uniformity is the goal of this convention license to allow the big players to play but already it is apparent that it is in by their own rules. This removes the danger of further splintering maritime central purpose of the Rules, which was law across the globe. All of the to bring back uniformity to carriage of signatories signed up between the date goods by sea. of the signing ceremony on 23 September 2009 and 29 September The Rules introduce the new concept of 2009 apart from Mali which signed on 26 the "maritime performing party" This is a October 2009. This illustrates that those party that conducts its business wholly that have signed already had a mind to within a port area. Therefore, a party sign before the signing ceremony took that collects from the environs of the port place. It also illustrates concern among and delivers inland is not a maritime the wealth of countries that did not sign. performing party, whilst a port operator Why is there such reticence? Below we is a maritime performing party provided aim to set out some of the main reasons its duties do not exceed the boundaries why the Convention is problematic. In of the port. It is, of course, not unusual closing we also answer the question that for a port operator to deal with on has been raised by a number of those carriage inland. The issuer of a transport that support the Convention - what is document involving carriage wholly or the alternative? partly by sea, and the maritime

performing party may both be sued such as that described in the example of who is responsible for loading and directly: whereas, an inland carrier above. discharge in road carriage. These duties involved in part of the international are normally those of unless the venture may not be sued directly. This To draw a further comparison with CMR, carrier agrees to be responsible for is, again, a protection for certain sectors cargo may sue the first, last or actual loading and/or discharge. Therefore, the involved in the carriage such as inland carrier, but those carriers may then sue multimodal carrier that takes on waterways, railways and inland road the actual carrier under the successive responsibility for this entire journey will carriers. There are cases where some carrier provisions. Under the Rotterdam be responsible for loading and discharge carriers will be subject to another Rules, the choice is to sue the issuer of whereas the inland carriers in China and Convention that takes precedence over the transport document or maritime the UK will probably not be responsible the Rotterdam Rules under Chapter 17, performing party, but those parties found for loading and discharge. In such a but not always Where the carriage of liable and wishing to sue the party case, the multimodal carrier will be goods involved is by a means other than actually causing the damage for responsible to cargo for damage on by sea which involves a partial sea recovery will have to rely on their terms loading and discharge. Although this movement another Convention may of contract with the underlying carrier damage may have been caused by the override the application of the Rotterdam and perhaps suffer a serious gap in the inland carrier, the multimodal carrier will Rules. For example, a door to door extent of liability recoverable compared be unable to pass down liability. This will carrier may carry goods from Germany with the liability it faces pursuant to the mean that multimodal carriers will have via France via road to the UK inland Rotterdam Rules. to reconsider all sub contracts to ensure involving a channel crossing. If the there are no such gaps in terms of goods stay on wheels throughout the Article 12 raises some problems. This flowdown of responsibility. journey, the CMR Convention would deals with the period of responsibility of override the application of the Rotterdam the carrier. The primary position is that However, as so often happens in this Rules but if the goods come off wheels the carrier is responsible for the period overly complex set of Rules, pursuant to for the channel crossing, the CMR covered by the transport contract. Article 13 whilst the Rules make the Convention would apply to the road However, Article 12(3) permits the carrier responsible to properly and movement from Germany to France but parties to agree on the time and location carefully receive, load, handle, stow, the Rotterdam Rules would apply from of and delivery of the goods, carry, keep, care for, unload and deliver when the goods come off wheels for the although this ability is limited because the goods pursuant to 13(1), 13(2) channel crossing though to the UK such agreement will be void if the time of allows the shipper and carrier to agree inland destination. Therefore, the receipt of the goods is subsequent to the that loading, handling, stowing and Rotterdam Rules fall short of creating a beginning of their initial loading under unloading be performed by the shipper, fair and reasonable liability system the , or if the time of the documentary shipper or the governing all those involved in the delivery is prior to the completion of their . Such an agreement has to transport venture. A full network liability final loading under the contract of be within the contract particulars. Again, system would have been fair and carriage. In terms of a carriage by road this will involve a wholesale review of reasonable but unfortunately the with a long sea journey in between, e.g. inland transport contracts with sub Convention creates a partial network inland UK by road to Liverpool and then contractors by multimodal contractors liability system or, as some people have by sea to Shanghai with final delivery by taking on primary responsibility door to described it, a maritime plus system road to inland China, this exemption door, The problem with Article 13 is that which causes unfortunate anomalies does not mirror normal custom in terms it does not deal with initial loading and

final discharge as does Article 12, so a party who has the ability to prove the liability prevails despite the fact that one multimodal carrier can contract out of issue in question. How would the of those parties (pursuant to Article 61) responsibility at any stage during the shipper be able to prove the liability of may have agreed to pay increased carriage when the goods are being the Carrier under this provision without levels of liability above those provided loaded, handled and stowed or unloaded the full and detailed co operation of the for by the Rules. by express contractual provision. This is Carrier? Even if the Shipper overcomes a watering down of the strict liability this apparently insurmountable burden, Article 25, dealing with deck cargo, is provision under Article 3 of the Hague the Carrier is then able to relieve itself of surprising in its distinction between deck Visby Rules. liability if it can prove that none of the cargo as required by law and in factors in Article 17.5(a) caused the loss, accordance with the contract of carriage Basis of Liability damage or delay or it complied with its or custom, usages or practices of the obligation to exercise due diligence. trade in question on the one hand; and, The basis of liability is set out in Article Therefore the duty of due diligence is carriage in containers or vehicles fit for 17 and this is a good example of the effectively reduced from the standard set deck carriage and the decks are excessive and unnecessary complexity pursuant to the Hague Visby Rules specially fitted to carry such containers that pervades the Rules. The only which would appear to be a or vehicles on the other hand. In respect saving grace is the disappearance of the retrogressive step. of the former, the Carrier is not liable for error in navigation defence which was loss and damage or delay in delivery if long overdue for removal given Articles 18 and 19 deal with liability of such losses are caused by the special advances in technology. However, the the Carrier for other persons and of risks involved in their carriage on deck exceptions are maritime in nature and maritime performing parties which whereas no such exemption from liability do not pay heed to exceptions apparent respectively extend the liability of the prevails in respect of the latter. One can in contracts and Conventions governing carrier for breaches by any performing only wonder at the reason for such other modes. We expect the answer to party and the ability of the shipper to distinction. Given advances in this point would be that other pursue another specific performing party technology one would expect all cargo, Conventions governing other modes are within the transport venture. This whether on deck or under deck, to be given precedence under Chapter 17, but appears to be an unnecessary extension treated with an even hand but such is that is only in certain circumstances as and is evidence of the Rules increasing not the case. explained above. Furthermore, and the duties of the carrier to cover other surprisingly, pursuant to Article 17.5(a) principal parties yet not ensuring that Delivery and the carrier's right the Carrier is liable notwithstanding the those parties are governed under the to deliver the goods without exceptions if the Claimant proves that Convention when it comes to dealing the surrender of an original bill the loss, damage or delay was probably with carriers' liabilities as between caused by or contributed to by the themselves. It also gives the shipper of lading unseaworthiness of the ship, improper another party to sue that is not a When encountering problems in finding crewing, equipping and supplying of the principal carrier in the transport venture. ship, or the holds or other parts of the Under Article 20, joint and several out who is the consignee or the controlling party, the carrier may in ship where the goods were carried were liability is also provided for and that not fit and safe for the reception, limits aggregate liability, so that if more accordance with Articles 46 (b), 47.2 (a) carriage and preservation of the goods. than one party is liable and that liability and 55.2 request instructions from the shipper. Such practice may be The burden of proof is invariably on the is aggregated, the Rotterdam Rules

appropriate when delivery is intended further aggravated by the carrier's right Article 11 stipulating that " The carrier straight to the consignee but not when to limit its liability for any breach of his shall, subject to this Convention and in the goods will or may be sold in transit. obligations including misdelivery (Article accordance with the terms of the 2000 CFR/CIF Article 8 59.1) with the result indicated by contract of carriage, carry the goods to provides that the document to be Professor Ramberg in his comments to the place of destination and deliver them tendered to the buyer must "unless Article 47.2 at the CMI 2009 Athens to the consignee" as well as the specific otherwise agreed, enable the buyer to Symposium (see CMI Yearbook 2009 at obligations in Articles 24,25,28,35- sell the goods in transit by the transfer of p. 264). Although the instructing shipper 36,38,40 and 45-48. The carrier's the document to a subsequent buyer may be requested to provide "adequate breach of these obligations may result in (the negotiable ) or by security" for the liability which the carrier economic loss for the shipper, e.g. when notification to the buyer". The notification may incur in relation to the rightful holder the purchaser justifiably refuses to provision has been inserted in order to this may be cold comfort for the holder accept a bill of lading as being dated too allow, for example an electronic bill of who may find himself in the unfortunate late or otherwise not conforming to the lading as referred to in the 1990 CM! position that he cannot get hold of the contract of sale. Customary bill of lading Rules on Electronic Bills of Lading or the goods and not even full compensation clauses exempt the carrier from electronic record as now referred to in for the loss of his right to get them. "consequential" or "indirect loss" but the Rotterdam Rules. The electronic such clauses now seem invalidated procedures rest on notifications In cases where the goods are intended under Article 79. In turn, the carrier has transmitted electronically. to be sold in transit, a prospective holder a right to limit his liability according to has not yet entered into a contractual Article 59.1 for "all breaches of its When the goods are intended to be sold relationship with the carrier. However, obligations under this Convention". This in transit, it would be wholly Article 58.2 refers to liability imposed on raises the question as to which limit inappropriate to ask a shipper having it" under the contract of carriage. applies. Should it be the SDR unit sold the goods to a first buyer, for Although the holder does not incur any limitation, when the dispute does not instructions with respect to delivery if the liability to the carrier until he exercises relate to the goods as such ("weight of ultimate bill of lading holder or the any right under the contract of carriage, the goods that are subject to the claim or controlling party does not appear to Article 58.2 seems to be based upon the dispute") but rather an economic loss for collect the goods at destination. Indeed, peculiar idea that the contract of the shipper because of his buyer's such a procedure may even invite a carriage as such may impose liability on repudiation of the contract? Should the shipper to collude with the first buyer in prospective holders. limit specifically relating to "loss caused order to defraud subsequent buyer(s) by delay" in Article 60 be used, as this is entitled to delivery. The extension of the the only article relating to "economic Rotterdam Rules to cover loss"? Article 60 seems to relate only to Although, in recent years, some shipping delay in delivery, but could possibly be more than loss of or damage lines have included clauses in their bills used to cover loss due to delay in of lading entitling them to deliver the to goods and delay shipment as well, at least by analogy. goods without the surrender of an Nevertheless, in case the carrier inflicts The Rotterdam Rules extend the original bill of lading, it is unacceptable economic loss on the shipper in other imposition of liability on the carrier also to support and further enhance such cases, such as providing incorrect for other loss than loss of or damage to malpractice by statutory provisions in the information (Article 28), refusal to issue goods and delay. This follows from nature of Article 47.2. This becomes a negotiable transport document upon

demand (Article 35) or to enter the commencement of the proceedings such a party can "institute" the action for required particulars (Article 36) or failing validly in accordance with the indemnity in circumstances where there to sign (Article 38), what is the limit? requirements of the relevant jurisdiction has been no finding or declaration of Furthermore, what is the basis of in which the proceedings are liability at that time. Again, wording liability? Would it be possible to use the commenced. In that context, it would similar to Article III Rule 6 bis of the basis of liability in Article 17 when the have been clearer to use the phrase Hague-Visby Rules "an action for carrier refuses to issue a negotiable "unless suit is brought", as used in the indemnity against a third person may be transport document upon demand? The and the Hague-Visby brought..." would have been clearer. answer may well be negative, as a clear Rules. breach of such nature may require a Actions against the person strict liability under general principles of Article 62.3 is confusing in that it implies identified as the carrier contract law. that one party can still make use of a time-barred claim by offsetting it against Under Article 37.2, it is presumed that Apparently, the extension of the the timely claim made by another party. the registered owner of the carrying Rotterdam Rules to cover more than the Whilst such an action may not be vessel is the carrier, unless he can rebut traditional types of losses (loss of or extinguished (being procedural only), it the presumption by establishing a damage to the goods and delay) was not still cannot be enforced, so it is not clear presumption in relation to a bareboat followed up by decisions on these how Article 62.3 will work in practice. charterer or that another party was in important questions. It will be the task of fact the carrier. In turn, the presumption courts of law to find appropriate Action for Indemnity in relation to the bareboat charterer may solutions and Article 2 on the be rebutted in the same manner. In any interpretation of the Convention will Claims in relation to Indemnity of these circumstances, the claim may probably not provide a sufficient impetus (recourse) may be made beyond the two be instituted beyond the two year time to ensure international uniformity. year period provided it is made within: limit in Article 62, provided that it is instituted within: Period of time for suit (a) the time allowed by the applicable law in the jurisdiction where the (a) the time allowed by the applicable The Rotterdam Rules provides a two- proceedings are instituted; or law and the jurisdiction where the year time limit for filing suit, but refers to proceedings are instituted; or judicial or arbitral proceedings not being (b) within 90 days commencing from "instituted" after the expiration of a the day when the party instituting (b) 90 days commencing from the day period of two years. The term the claim either settled the claim or when the carrier has been "instituted" is derived from Article 20 of was served with process in an identified, or the registered owner the and is vague and action against itself, whichever is or bareboat charterer has rebutted unclear. It is apparent that Article 62 the earlier. the presumption that he is the was drafted in this way to make the time carrier, whichever is the later. bar procedural, rather than substantive, Article 64 adopts the wording of Article but it would be preferable to have 20.5 of the Hamburg Rules by referring Whilst this qualification seeks to protect consistency by setting the effective date to that party seeking the indemnity as claimants where the identity of the of the limitation to the bringing of suit, the "person held liable" which is contractual carrier is not ascertained which must be achieved through obviously inconsistent with the fact that until late in the day and, possibly, only

after the claim has been initially where the goods are finally discharged (ii) contains a prominent statement instituted against the wrong defendant, it from a ship, or in a competent court or that there is an exclusive choice of places the correct defendant carrier at a courts agreed between the shipper and court agreement and specifies the distinct disadvantage in circumstances the carrier for the purpose of deciding sections of the volume contract where national laws overrule the two claims against the carrier that may arise containing that agreement, and year time bar in the period in the under the Rotterdam Rules. clearly designates the courts of Convention, giving claimants a one contracting state or one or considerably longer period for instituting Where the parties conclude a jurisdiction more specific courts of one proceedings where the party that issued agreement after the dispute has arisen contracting state. the transport document failed to comply (Article 72. 1), is not clear how such a with Article 36, paragraph 2(b) in failing jurisdiction of agreement would comply In relation to a carrier and a third party to disclose the name and address of the with Article 66 where the contract of (but not a maritime performing party), an carrier in that document. There is no carriage did not have a jurisdiction exclusive jurisdiction clause will only be justification for referring to the national agreement that was exclusive. In such binding if it is in a volume contract and laws overruling the convention time bar circumstances, it is arguable that the satisfies the requirements of Article 67 period, particularly as so many common claimant could still bring proceedings in paragraph 1 above, together with law jurisdictions provide for a six year a competent court and one of the four additional requirements set out in Article time limit from accrual of the cause of places identified in Article 66, although 67, paragraph 2, being : action for breach of contract. 90 days not in the court agreed by the parties from the date of notification would have after the dispute has arisen. Such a (a) the court is in one of the places been more than sufficient to protect such claimant may or may not be met with an designated in Article 66 claimants. anti-suit injunction, if available to the subparagraph (a); other party to the dispute. Article 66 Actions against the carrier would need to be interpreted broadly to (b) the agreement is contained in the include jurisdiction agreements transport document or electronic Article 66 does not apply where "the concluded after the dispute has arisen. transport records; contract of carriage contains an exclusive choice of court agreement that Choice of court agreements (c) that person is given timely and complies with Article 67 or 72". adequate notice of the court where Provided there is no such exclusive Under Article 67.1, an exclusive the action shall be brought and jurisdiction agreement, the claimant can jurisdiction clause between the shipper that the jurisdiction of the court is elect to sue the carrier in a competent and the carrier will only be binding if it is exclusive; and court where the carrier is domiciled, or in a volume contract, the parties agree one of the four places which are the on exclusive courts jurisdiction, the (d) the law of the court seized trigger for the application of the volume contract clearly states the recognises that that person may Rotterdam Rules in Article 5, that is, the names and addresses of the parties and be bound by the exclusive choice place for receipt of the goods agreed in either: of court agreement. the contract of carriage, the place of delivery agreed in the contract of (i) is individually negotiated; or Whilst private international law will carriage, the port where the goods are continue to evolve, Chapter 14 of the initially loaded on to a ship or the port Rotterdam Rules will add an additional

layer of complexity for parties seeking to another court without contesting its distinction between volume and other rely upon choice of jurisdiction clauses jurisdiction (Article 72.2). Significantly, contracts and between the parties to the as they must now also establish that the maritime performing carriers, such as agreement and a person who is not a relevant contract is a volume contract, , terminal operators and party to the Volume Contract, save for and that it was individually negotiated warehouseman, cannot be bound by an the fact that the applicable law permits etc. For third parties, however, Article exclusive jurisdiction clause in the that person to be bound by the 67 adds even further complexity where contract of carriage - Article 69 provides Arbitration Agreement, rather than the the court seized must recognise that the that a maritime performing carrier cannot law of the forum which applies to courts third party may be bound by the be sued anywhere other than these jurisdiction clauses (Article 67.2(d)). exclusive choice of court agreement. places. Accordingly, a claimant who is Any term of an arbitration clause that is Obviously, the law will differ from state subject to an exclusive jurisdiction inconsistent with these provisions is void to state as to whether such a third party clause in the contract of carriage can be (Article 75.5). is bound by such a clause (Article prevented from suing the maritime 67.2(d)) leading to further disputes and performing carrier in the chosen Apart from the possibility of having litigation. Potentially there will be jurisdiction. Article 71 permits arbitration taking place in a number of different results in different contracting consolidation of actions (and removal of different possible locations will reduce states, depending on whether they actions through declaration of non- commercial certainty, the contracting regard the question as one of procedural liability) when the relevant jurisdiction states that adopt Chapter 15 may or law or substantive contract law, leading satisfies the dual tests of Articles 66 and may not be properly equipped or have to potential problems of enforcement. 68, so article 71 is superfluous. the expertise or experience to handle The third party will require preliminary maritime disputes, nor have a court advice as to whether they are bound by No additional bases of system which will support those the exclusive choice of agreement which jurisdiction arbitration proceedings. will depend on which law is applicable. This may, in turn, depend upon whether As Chapter 14 is optional for contracting Article 75.4(d) provides for the the procedural or substantive law of the states, it is unclear what purpose Article applicable law to determine whether contract is applicable. 69 seeks to achieve. The contracting arbitration agreement is binding on a states that adopt Chapter 14 will be third party. Potentially there will be Actions against the maritime limited to courts designated in Articles different results in different contracting performing party 66 and 68 and the contracting states states, depending on whether they who do not adopt Chapter 14 will follow regard the question as one of procedural A claimant can only bring proceedings their respective national laws in deciding law or substantive contract law, leading against a maritime performing party jurisdictional issues. to potential problems of enforcement. either where the maritime performing The third party will require preliminary advice as to whether they are bound by party is domiciled or where that party Arbitration Agreements receives or delivers the goods, or the arbitration agreement which will performs its activities in respect to the Article 75 permits the parties to refer any depend on which law is applicable. This goods, unless the parties agree some dispute that may arise relating to the may, in turn, depend upon whether the other court after the dispute arises carriage of goods under the Rotterdam procedural or substantive law of the (Article 72.1), or the maritime performing Rules to arbitration. Chapter 15 is contract is applicable. party submits to the jurisdiction of similar to Chapter 14 in that it draws a

Article 78 makes the arbitration contracts", which are extremely broadly than those imposed by this provisions of chapter 15 binding only on defined in article 1: Convention. states that declare under article 91 that they will be so bound. It echoes the opt- "Volume contract" means a 2. A derogation pursuant to in provision in article 74 regarding court contract of carriage that provides paragraph 1 of this article is jurisdiction in chapter 14. Each opt-in for the carriage of a specified binding only when: provision in Rotterdam decreases quantity of goods in a series of uniformity of law, introducing uncertainty shipments during an agreed period (a) The volume contract contains a that will discourage international of time. The specification of the prominent statement that it commerce. In a particular claim, even if quantity may include a minimum, a derogates from this Convention; all relevant jurisdictions adopt Rotterdam maximum, or a certain range. it will still not be clear which arbitral fora (b) The volume contract is (i) are permitted. This will encourage Shippers will find this definition too individually negotiated or (ii) disputes about jurisdiction, which are broad and unspecific. It includes any prominently specifies the section expensive distractions from dealing with contract for more than one shipment in of the volume contract containing the merits of the claim. any period of time, for example, a the derogations; contract to ship two packages over a Exclusions of liability and the period of three years with an option to (c) The shipper is given an opportunity and notice of the volume contract exemption cancel the second shipment. opportunity to conclude a Article 80 contains controversial contract of carriage on terms and Article 79 laudably follows the principle conditions that comply with this of the Hague Rules, making void any minimum requirements that the carrier must meet in order to have a contract Convention without any term of a contract of carriage that derogation under this article; and excludes or limits the liability of the qualify as a "volume contract". In theory, these should give the shipper an carrier (or excludes, limits or increases opportunity to negotiate a higher freight (d) The derogation is not (i) the liability of the shipper) beyond those incorporated by reference from allowed by Rotterdam. rate for a higher liability under Rotterdam. In practice, creative carriers another document or (ii) included in a contract of adhesion that is However, article 80 undermines the will use contractual forms that arguably not subject to negotiation. principle in article 79 for "volume comply with Rotterdam, but without real contracts" and is the most objectionable negotiation. The requirements are: A typical multi-modal container shipment part of Rotterdam according to many would almost certainly be a "volume commentators. Rotterdam creates Article 80. Special rules for volume contract" and thus subject to the theoretical door-to-door uniformity of contracts freedom of contract which, even now, law, but at the unacceptably high cost of 1. Notwithstanding article 81, as often leads to complex contractual reviving the chaotic freedom of contract between the carrier and the arrangements with many layers of sub- which necessitated the creation of the shipper, a volume contract to contracts, making claim outcomes Hague Rules in 1924. difficult to predict.which this ConventionRotterdam applies will Article 80 allows parties to derogate their may provide for greater or lesser worsen this problem. obligations under Rotterdam in "volume rights, obligations and liabilities

Rotterdam may apply to inland transit in present. Rotterdam is more likely to based on the USA negotiators' advice states where there is no "international allow the ocean carrier to avoid liability that the USA would ratify Rotterdam only instrument" affecting inland transit under under "volume contracts", leaving if these terms were present. If the USA article 26, for example, in North forwarders more exposed to cargo ratifies, then many countries will America. There are serious issues claims because forwarders have more seriously consider Rotterdam in order to about whether Rotterdam applies to ,.one off' (not "volume") contracts with achieve uniformity with the USA, despite inland transit damage. The Rotterdam shippers than do carriers. its flaws. If the USA does not ratify, then limits differ from existing inland regimes. everyone will be disappointed with a For example, they are higher than the Special Agreements convention with unacceptable flaws due Canadian motor carrier statutory limit of to the USA's terms, and years of work Cdn $4.41 per kilogram. A container Article 81(b) allows freedom of contract will have been wasted. with 1,000 packages weighing 10,000 for "special agreements", being kilograms would allow the motor carrier agreements unrelated to ordinary What Alternative? to limit liability to Cdn $44,100 under the commerce and where no negotiable Canadian motor carrier regime. document is issued. Although this There is a lot to be said for not throwing However, the Rotterdam limit for that provision has the potential for abuse by away that which has not ceased to work. container is 875,000 SDR's (about Cdn carriers in some circumstances, that There is also a lot to be said for $1.4 million dollars). The limit under the potential is entirely overshadowed by the simplicity. With less than 20 articles, the CMR Convention (road) for that "volume contract" freedom of contract Hague-Visby Rules has been a very container is 83,300 SDR's (about Cdn problem in Article 80. long lived and successful Convention $133,000) and under both the Cotif/CIM and Protocol. With over 90 articles and Convention (rail) and the Montreal Ratification many new concepts we are of the view Convention (air) is 170,000 SDR's that the Rotterdam Rules should not (about Cdn $270,000). These different Article 94(1) provides that Rotterdam prosper as we do have the makings of a liability limits, for the same claim, will comes into force on the first day of the network liability system in Conventions encourage multi-modal carriers under month one year after the 20th that are long lived, well used and Rotterdam to seek "volume contracts" ratification, a day that the authors of this relatively simple. that reduce their liability to below Cdn paper hope never comes. At the time of $44,100, often to zero. Cargo interests writing, no state has ratified, and the The work of CMI initially involved will then sue motor carriers, freight most recent (21st) signatory on October comparing and contrasting Hague, forwarders, and all other available 26, 2009 was Mali. Signature, of Hague-Visby and Hamburg Rules with a targets seeking to avoid either the low course, is far less significant than view to bringing back uniformity to motor carrier limit, or the zero limit ratification. international maritime law. That work permitted by Rotterdam, There will be should be used as a core base to create uncertainty about the effect of Summary the maritime core. Inevitably due to Rotterdam, and much litigation with modern technology the error in unpredictable results in different In summary, Rotterdam contains several navigation clause in the Hague-Visby countries. terms, notably "volume contracts", that Rules should be removed and the will make Rotterdam a difficult sell to electronic documentation provisions Freight forwarders will probably face many governments. These terms were from the Rotterdam Rules could be more law suits under Rotterdam than at added at the USA's insistence, and included. The Montreal Convention for

air carriage and CMR Convention for fragmented system than that already in uniformity. There is no doubt that road and CIM-COTIF for rail could all be place which the Rotterdam Rules uniformity is what is needed and adopted on a wider basis. CMR and appears to be heading for creating furthermore all stakeholders need to be CIM-COTIF are European Conventions instead of reaching its goal of uniformity. dealt with fairly under any international but there is no reason why they should We urge those countries that have regime. The central issue with these not work across the globe. A suitable signed and those that have not to Rules is the fact that certain clause to deal with any potential clashes consider the many problems with the stakeholders are able to contract out or between the conventions would not be Rotterdam Rules and the potential are not even covered and once liability too complex to draft. Indeed the CMR alternative we have in the form of as between cargo and Carrier has been Convention already has such a clause current conventions meshed together dealt with there are no provisions for dealing with when the convention should with national law. dealing with liability between carriers apply and when not when the goods involved in the contractual chain to being carried are on water. As long as To reach overall global uniformity along ensure that the actual liable party ends the goods remain on wheels then the the lines of the conventions dealing with up paying for the loss. The volume Convention applies. non may well be contract exemption is a most worrying cumbersome. However, the main merits development that favours the large scale These conventions covering the four of the Rotterdam Rules (the deletion of stakeholders and allows them to make major transport modes that are the error in navigation defence and their own rules. Allowing such freedom specifically tailored to deal with these introduction of the electronic record) on an international basis in the banking modes (which the Rotterdam Rules is could easily be saved by protocols to the sector recently created a worldwide not) have been long tried and tested and existing maritime conventions. This financial crisis. We could end up with the work well with many countries across would leave the field free for adopting a large scale stakeholders gaining such the globe having ratified in large more suitable international regime than sufficient market power to enable them numbers. Why reinvent the wheel? If the Rotterdam Rules to govern transport to hold the international supply chain to these conventions were offered for wider in the modern era of transport logistics. ransom. Do we really want to facilitate acceptance with a view to uniformity with what happened in the banking world an agreement that any gaps would be The Rotterdam Rules are clearly in becoming a potential reality in the field dealt with by national law we would have danger of causing further splintering of of international transport? a tailored worldwide system already international maritime law despite the widely in use rather than a more intention of the same to bring back