UN shipping convention ready for Australia
A maritime lawyer has strongly encouraged Australia to sign a new international shipping convention to improve and modernise terms of carriage.
“Eighty percent of world trade is now conducted by sea. Supporting a uniform framework that clarifies the rights and responsibilities of marine cargo carriers and shippers promotes international trade and is in turn good for Australia,” said Stuart Hetherington, partner at Colin Biggers & Paisley lawyers.
More than 20 nations, representing 25 percent of world trade by volume, have signed the United Nations (UN) Convention on Contracts for the International Carriage of Goods Wholly or Partly by Sea, also known as the ‘Rotterdam Rules’. Signatories include Denmark, France, Greece, the Netherlands, Switzerland and the USA.
“Australia’s regime has been grafted on to the original archaic rules which hark back to a time when cargo was shipped in bags or boxes rather than containers, and communication technology was still in its infancy. It is generally considered out of date and cumbersome,” said Hetherington.
Main changes in the Rotterdam rules:
- Extends the period when carriers are responsible for goods. The period is from when cargo is received by the carrier to when it is delivered.
- Contemplates e-commerce and aims to treat paper and electronic documents consistently.
- Extends the carrier’s obligation to provide a properly crewed, equipped and seaworthy ship and to keep holds fit for cargo throughout the sea voyage.
- Increases the amount by which carriers can limit their liability to 875 units of account per package or shipping unit or three units of account per kilogram of gross weight.
- Removes the ‘nautical fault defence’ to enable carriers to be liable for the negligent navigation or management of the ship.
- Extends the time to commence legal action to two years from the day the goods were delivered or should have been delivered.
- Allows parties to ‘volume’ contracts (contracts that provide for the carriage of a specified quantity of goods in a series of shipments during an agreed period) to ‘opt out’ of much of the convention’s liability regime.