The Hindu Business Line : Unctad study on multimodal transport — New international legal framework sought

Unctad recently conducted a study on the need for a new international legal framework governing various aspects of multi-modal transportation. The views of several governments and inter-governmental and non-governmental organisations, including all relevant industry associations, on this issue were reported in the Unctad Review of Maritime Transport 2003.

SOME time ago, the United Nations Conference on Trade and Development (Unctad) conducted a study on the feasibility of establishing a new legal international instrument on multimodal transport in view of the steady growth of multimodal transportation and the emergence of an increasingly complex and fragmented legal framework at the international level.

A questionnaire was prepared and circulated widely to all governments and inter-governmental and non-governmental organisations, including all relevant industry associations as well as experts in the field. The Unctad secretariat received a total of 109 replies — 60 from the governments of both developed and developing countries and 49 from industry representatives.

The replies, according to the Unctad Review of Maritime Transport 2003, reflected the view of all parties concerned such as operators of transport services including maritime, road and rail, freight forwarders, providers of logistics services and terminal operators, liability insurers and cargo insurers as well as shippers and users of transport services. A large majority of the respondents — as high as 83 per cent — representing government, non-government and industry felt that the present legal framework was unsatisfactory, with a clear majority (76 per cent) considering the present system as not cost-effective.

More than 90 per cent of the respondents across the board expressed the view that a new international instrument to govern the liability arising from the multimodal transport was definitely needed and virtually all (98 per cent) supported a concerted effort in this direction, stated the Unctad Maritime Review.

As regards the most suitable approach to be adopted, the views, to a certain extent, were divided. However, about two-thirds of respondents from both governments and non-government agencies (65 per cent) appeared to prefer a new international instrument to govern multimodal transport or a revision of the 1980 MT Convention.

The Convention, it was clear from the responses, was not attractive enough from shippers' point of view while at the same time containing elements which carriers found unacceptable. A number of respondents, therefore, favoured a new legally binding instrument based on rules currently used in commercial contracts, such as Unctad/ICC rules.

A minority of respondents (13 per cent), representing mainly part of the maritime transport industry, favoured extension of an international sea carriage regime to all contracts for multi-modal transport involving a sea-leg, with some respondents supporting the proposed Draft Instrument on Transport Law, which adopts this approach.

Another minority of respondents (13 per cent), representing mainly the road transport industry, felt the extension of an international road-carriage regime to all contracts for multimodal transport with a road-leg to be the most appropriate approach.

Overall, the responses indicated that — excepting for the maritime transport industry — there was limited support for the approach adopted in the Draft Instrument on Transport Law, suggesting that there was significant scope for the exploration of other options in consultation with all interested parties.

The vast majority of respondents (90 per cent) thought that any instrument governing multimodal transport should address the issue of delayed delivery, although some believed that liability for delay should arise only in certain circumstances and should be limited at a level equivalent to the freight or multiple thereof.

As regards the type of liability system to be most appropriate, the views were divided, with 48 per cent of the respondents expressing support for a uniform liability system and, among the remainder of the respondents, broadly equal numbers supporting with a network liability system (28 per cent) or a modified liability system (24 per cent).

Among those favouring network or a modified liability system, a majority (59 per cent) believed that only the limitation provisions should vary depending on the unimodal stage where loss, damage or delay occurred. This view was particularly prevalent among respondents representing governments.

Others, especially non-government respondents, felt that matters such as the basis of liability or exceptions to liability and time for suit should vary.

Early agreement on the most appropriate type of liability system, including the extent to which the liability rules should be uniform, would clearly be central to the prospect of success of any discussion on a new international instrument.

Closely linked to the question of appropriate liability system was the issue of limitation of liability of which the views were again divided. While several government and non-government organisations questioned the whole idea of limitation of liability, there were others — particularly those representing the maritime and freight forwarding industry — who stressed the need for limitation of liability in line with unimodal conventions.

They felt such conventions continued to be relevant in the context of recourse actions by multimodal carriers against unimodal sub-contracting carriers, added the Unctad Maritime Review.

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