Shipper's obligations under the Rotterdam rules

Autor:Johan Schelin

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See note 1

1. Introduction
a Shipper as the weaker party?

The traditional view has since long been that the shipper is the weaker party to the contract of carriage of goods by sea. This was the background for the enactment of the U.S. Harter Act in 1892. Al ready in 1890 the Glasgow Corn Trade Associa tion had complained to the British prime minister: "bills of lading are so unreasonable and unjust in their terms as to exempt [carriers] from almost every conceivable risk and responsibility."2This view was also shared by U.S. shipper interests and in order to re-establish the balance in the contractual relation ship a mandatory liability regime was intro duced by the U.S. Congress. In its origi nal form, the bill strongly favored cargo inte rests by prohibiting the use of exoneration clauses to avoid liability for loss or damage

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due to "negligence, fault or failure" in the loading, stowage, custody, care, or proper delivery of the cargo. Also clauses limiting the liability "to less than a full indemnity to the legal claimant" were de clared null and void. Con gressman Harter explained on the House floor that the bill would:

"by its operation deprive some foreign steamship com pa nies of certain privileges which for many years they have exercised to the great disadvantage of American com mer ce."3The same view also formed the basis for the Hague Rules that were adopted in 1924. The Rules apply to transport under bills of lading only, but by grant ing the shipper a right to request a bill of lading, he can by himself trigger the application of the man datory carrier liability regime.

The focus in the Hague Rules - and later in the Hague Visby Rules - is clearly on carrier liability. The Rules contain only a few pro vi sions on the liability of the shipper. Under Art. III, para. 5, the shipper has got a strict liability for the accuracy at the time of the shipment of the marks, number, quantity and weight of the goods as furnished by him for insertion in the bill of lading. In Art. IV, para. 3, it is stated that the shipper has got a fault liability for loss and damage caused by him. How ever, even here the liability rule takes the form of a protection of the shipper against the carrier. In para. 3 it is stated that:

"the ship per shall not be responsible for loss or damage su stained by the carrier or the ship arising or resulting from any cause without the act, fault or neglect of the shipper, his agents or his servants sustained by the carrier and the ship."

In other words in the bill of lading the carrier cannot prescribe a strict liability for the shipper for loss and damage sustained by the carrier.

The general principle of a fault based liability was somewhat modified in the Hamburg Rules of 1978 with regard to dangerous goods. Under Art. 13 the shipper has an obligation to mark or label dangerous goods and to inform the carrier of the dangerous cha rac ter of the goods and the precautions to be taken. If the shipper fail to do so and the carrier or the actual carrier otherwise do not have knowledge of the dangerous character of the goods, the shipper is strictly liable for the loss resulting from shipment of such goods.4

Despite this change compared to the Hague Visby Rules, the overall impres-

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sion of the pro visions of the Hamburg Rules is that they are basically in tended to protect the shipper against abuse from the carrier.

However, is the shipper really to be considered as the weaker party today as in the beginning of the 20th cen tury? Of course a number of shippers still consist of small companies or even natural persons. Other shippers - even if they form quite big compa nies - are in practice forced to turn to the only shipping line operating to and from the port they make use of. The carrier here becomes a sort of monopolist. But, the overall picture is that the situation has changed a lot since the adoption of the Hague Rules in 1924. Today shippers often consist of multinational compa ny groups ope rating all over the world and the goods are shipped between different parts of these groups as a form of B2B-business. Not seldom these shippers require the carri ers to accept transport con ditions more favo r able to the shipper than the Hague Visby Rules, such as strict unlimited liability up to the value of the goods shipped. In other words, a more realistic picture of the transport market today is perhaps that it is rather the carriers that use the Hague Visby Rules as a sort of pro tection than the other way around. This is illustrated by the fact that in a num ber of char ter parties on the market, carriers have made the Hague Visby Rules the appli cable liability regime already in re lation between the carrier and the charterer regardless of whether a bill of lading has been issued and trans ferred to the con signee.

The Rotterdam Rules reflect this change on the market to a certain extent. Even though an im por tant aim of the Rules is still to protect small and medium-sized shippers, it is obvious that the general view of the shipper has changed consider ably. Al ready the fact that the Rotterdam Rules contain a specific chap ter on the obligations of the shipper in relation to the carrier is a clear proof of that. Com pared to the Hague Visby Rules the shipper has through the Rotter dam Rules sud denly become vi sible.

b Change of trade patterns

Why has the shipper suddenly become visible then? It seems that the fact that shippers often have a stronger bar gaining power in relation to carriers is not the only reason for this change of view. What seems to be equally important is the change of trade patterns between today and 1924 when the Hague Rules were adopted. In 1924 goods carried by sea consisted mainly of raw materials. In Sweden there was a specific expression for that: "timber out and coal home", which illustrated the fact that one of the most common trades for a Swedish merchant vessel in those days was the North Sea trade, i.e. carriage of timber from Sweden to the Uni ted Kingdom and coal back home.

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Since then the trade patterns have totally chan ged. Even if bulk cargo still forms the vast majo rity of the amount of goods carried by sea, the importance of carriage of general cargo have grown a lot, especi ally when looking at the value of the cargo. In addi tion many more types of cargo are shipped to day and it is difficult for carriers to have knowledge of how to handle all types cargo, such as various hazar dous and noxious sub stances, special types elec tronics and other machin ery. Instead the shipper is the expert on this.

The containerization and the use ro/ro-ships for the transport of road trailers have also lead to the fact that today carriers have less possibilities to check what the goods actually consist of and that they are able to withstand the sea voyage. This might pose risks both in re lation to the crew and the ship. If goods are not declared properly this might lead to that they are handled in a way that gives rise to explosions or other damages on board the ship. Goods not properly stuffed inside containers or trail ers may in a worst-case scenario cause the ship to capsize.

Improper declaration of goods may also lead to that it becomes im possible to get them off the ship in the port of destination because of the fact that the safety and security legislation of the port state is not complied with.

In other words modern transport today more and more appears as a business based on a mutual long-term interest to cooperate in creating an efficient and safe flow of cargo, rather than a number of single transport contracts where the primary goal of the par ties is to protect their respective economic interests in case some thing would...

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