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Since the Montreal Convention of 1999 (relating to increase of limitation of liability in regard to transportation of cargo by air) came into force, International Civil Aviation Authority has the obligation to conduct a review every five years of the liability limit based on the inflation factor. If the inflation factor exceeds 10 per cent at the time of review, the authority has to notify the result of such a review to all state parties of the convention. At present there are 91 state parties. The review conducted by the authority, based on IMF’s World Economic Outlook Database 2009, suggests that there has been an increase of 13.1 per cent. Consequently, the aviation body is considering revising the convention liability from 17 SDRs a kilogram to 19 SDRs in case of destruction, loss, damage or delay of cargo. The new limits will not come into force if the majority of State parties file their disapproval. However, that has not happened as yet, reports have it. In other words, the new limits will come into force from January 1, 2010.

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