International shipping is one of the most common methods of cargo delivery in international trade, which has been carried out for more than one hundred years, and during this time special rules have been developed, which all participants in international trade must observe. These rules govern the carriage of goods from the drafting of the contract (bill of lading) to its delivery to the port.
What is a bill of lading
A bill of lading is an international shipping contract concluded by a freight carrier and a charterer (consignor or consignee). It spells out the rights and obligations of the parties, a description of the cargo and other requirements related to the transportation of a certain cargo. The provisions in the bill of lading are determined not only by mutual agreements, but also by the rules of sea freight. The bill of lading must contain the conditions under which the goods must be delivered. The time and place of its dispatch and delivery are indicated. The document also stipulates cases in which the carrier is not responsible for the goods delivered.
International shipping is carried out in accordance with the international code for the carriage of goods by sea and with the following legal documents:
- The Hague rules.
- The Hague-Visby Rules.
- Habsburg rules.
In addition to the documents listed above, in 2009 new Rotterdam Rules were developed. It is assumed that over time they will become a single set of rules for all countries. A single system will streamline relationships, replacing the old, outdated standards and rules.
All of the above provisions, together with the international shipping code, create a unified system of legal regulation and regulation of international cargo transportation. Based on these provisions and documents in international trade, laws have been developed, the rights and obligations of all parties have been defined: the sender, the carrier and the recipient.
The Hague Rules
This document was developed and adopted in the world practice of international shipping of goods back in 1924 in Brussels. Since then, it has been ratified in more than 74 countries around the world, including the UK and the Netherlands. Later, various changes and additions were made to it.
The Hague rules, in other words the Brussels Convention, were adopted in order to unify the form and content of the bill of lading, as well as to determine the degree of responsibility of the carrier in case of violation of the terms of the contract.
The document defines such important concepts of international shipping as a carrier, a contract of carriage, cargo, ship and cargo transportation. The maximum penalty for violation of the terms of the contract, in accordance with these rules, is only £ 100 per unit of cargo, which is very small by modern standards.
The rules are valid all over the world, regardless of whether or not a country has ratified them, if indicated in the bill of lading. In other cases, they are valid only in those countries and between those parties that have accepted and ratified the Brussels Convention. However, due to the fact that the amount of compensation for lost or damaged goods is too small, the rules had to be heavily edited. So, based on the Hague rules, the Hague-Visby rules were developed.
The Hague Visby Rules
The text of the rules for international shipping by sea was developed and distributed in 1968. The Brussels Convention served as the basis for them. The amount of compensation for damage that the freight carrier was supposed to pay was increased. The currency specially designed for this, the gold franc, was indicated. The issue of transportation of containers and compensation for damage if this container was damaged or lost was settled. So, one container was equated to a unit of cargo. Damage could be compensated not only in the amount prescribed in the rules, but also determined by the parties to the bill of lading in an amount equal to the market value of the goods.
Habsburg rules
The international shipping rules were developed in 1978, as the previous documents did not cover all the problems associated with the regulation of relations between the carrier and the sender. They were developed at the initiative of UNCITRAL on the basis of the previous two documents - the Hague and The Hague-Visby rules.
The Hamburg rules encompassed a wider range of concepts and more closely met the requirements of the time and the prevailing situation in international trade. It was clarified in which cases the carrier is responsible and when this responsibility will be removed from him. The document clearly states that the carrier is responsible for the condition of the cargo only from the moment it is sent until arrival at the port of destination. This made it possible to eliminate the problem of determining liability for damage to the goods, if it was made before or during loading it on the ship.
Rotterdam Rules
Rotterdam rules were prepared by the International Maritime Committee. Subsequently, the UN Commission was involved in the creation of the document from 2002 to 2009.
On December 11, 2008, the UN General Assembly adopted the document and called on all countries that are members of this organization to consider adopting and using these rules.
Despite the fact that these rules are quite new and, in theory, should meet the requirements of the time, many countries do not seek to ratify them and introduce them into the legal practice of international cargo transportation by sea. The thing is that the provisions of this document are designed in such a way that they are beneficial only to one side and not beneficial to the other. Therefore, they were adopted by only a few countries. A total of 16 countries have signed the Convention: Denmark, Greece, Spain, the Netherlands, Norway, Poland, USA, France, Switzerland, Gabon, Ghana, Guinea, Nigeria, Congo, Senegal and Togo.
Shipper's Responsibilities
The rights and obligations of the shipper include the preparation of the goods for shipment and the preparation of relevant supporting documents. He also pays for the services of a carrier or rents a ship.
First, the sender enters into a contract with the recipient for the delivery of a certain cargo. After that, he goes to the carrier to conclude a transportation agreement. In accordance with the adopted rules of international shipping of goods, a special agreement must be drawn up between them - a bill of lading. It must contain the following data:
- address and name of the consignee;
- sender address and name;
- name of the port of dispatch;
- name of port of arrival of cargo;
- the period during which it must be delivered;
- the condition of the cargo and packaging (how and what is packed, in what condition it is, what category of cargo it belongs to);
- number of copies of the contract;
- date and place of drawing up the contract;
- signature of the carrier or any other person responsible for the carriage of goods.
By agreement of the parties, the document may indicate the conditions upon the occurrence of which delivery delays are permissible. After the cargo is delivered to the ship, responsibility for its condition passes to the carrier.
Responsibility and rights of the carrier
The carrier is obliged to ensure the delivery of goods to the place specified in the contract, and on time. He must comply with the rules of international shipping by sea. In accordance with these rules, his duties include:
- Provide conditions for the transport of goods in integrity and security. For this, his ship must be suitably equipped.
- Ensure safety in maritime transport for passengers and crew.
- Keep the marine vehicle in good condition, regularly carry out maintenance and inspection of the vessel for cracks in the hull, holes, etc.
- Avoid leakage of substances during the transport of dangerous goods or violation of the conditions of their transportation.
The degree of liability for violation of the rules depends on the type of cargo and the type of contract for hiring the vessel and the services prescribed therein. So, if it is a dangerous cargo, and if the integrity of the container is violated, the environment can suffer, people die, then the punishment will be severe. The transport of such baggage is regulated by the international code for the carriage of dangerous goods by sea.
Rent a ship. Types of leases
In addition to hiring a vessel, there is also a rental. Lease agreement (freight) - charter. This is a document according to which the carrier agrees to transport the goods, and the supplier or recipient agrees to send it and pay for the transportation. Moreover, the carrier and the shipowner may not be the same person. The content and structure of the contract is governed not only by the rules of international shipping, but also by national legislation. The following types of leases are available:
- Charter party (scheduled charter). Such an agreement stipulates that the captain and crew are only employees, and the shipowner, not the ship's captain, takes all responsibility for transportation. It is he who bears the costs of servicing the vessel, including the payment of the crew’s work and material liability for damage or loss of cargo, even if it was not his fault.
- Time charter. With this type of lease, the responsibility for the condition of the cargo lies with the charterer (sender or receiver). He pays for the work of the crew and bears all the costs of maintaining the ship and transporting the cargo. In this case, the crew does not report to the charterer, but to the shipowner or ship captain.
- Deal charter. Rent a ship without a crew. Responsibility for the transportation and maintenance of the vessel lies entirely with the lessee. The shipowner does not bear any responsibility, but only receives the rent.
Charter and bill of lading are not the same document. The first is used only in case of lease of the vessel, the second - for any transport by sea. But both documents must be in writing, and their content should not contradict the legislative regulation of international shipping: the Convention (Hamburg Rules) and international law.
A little bit about responsibility
Responsibility for violation of the bill of lading can be removed in the following cases:
- in case of fire, provided that the cause of the fire was unintentional arson or spontaneous combustion;
- strike on board;
- political instability (war, revolution) in the country to which the goods should be delivered;
- pirate attacks;
- violation of packaging that was detected upon delivery by the shipper to the ship;
- damage to the ship due to unforeseen circumstances, for example, if the ship ran aground or was broken during a storm.
In the first adopted international shipping rules (The Hague Rules) in the text of the document, there was one more condition under which liability could be removed from the freight carrier. This is the so-called "navigation error." But since more than half a century has passed since then, and during this time, navigational ship technology has improved significantly, the application of this rule has been called into question. More and more experts in international law are inclined to believe that the “navigation error” is an anachronism and should be eliminated.
Punishment in case of violation of the terms of the contract
If damage or loss of cargo is discovered and the carrier cannot prove his innocence, he will have to be punished for the damage. Such cases are heard in arbitration. Usually, a fine is imposed as a punishment, which is calculated on the basis of the area occupied by the cargo or the value indicated in the accompanying documents.
According to the rules of international shipping, the penalty is paid in a special currency for this - francs. One franc is equal to the cost of 33 grams of gold of the 900th test. However, given the current state of international trade relations, the fine can be paid in one of the world currencies: dollars, euros, pounds or yens. The amount of the fine is calculated at the exchange rate. The minimum fine is 100 pounds, but usually a significantly larger penalty is imposed on an unscrupulous carrier.
In the event that due to the actions of the carrier, people were killed or irreparable damage was caused to the environment, criminal punishment may await him.
Problems of legal regulation of maritime transport
The main problem of legal regulation of international shipping is that in this area there is no single legal system. The rules developed in Hamburg, The Hague and York, although they exist, are not adopted in all countries engaged in international trade and transportation of goods by sea. This creates difficulties in determining the rights and obligations of the parties to the transaction, especially if different rules and standards have been ratified in these countries.
Difficulties in the legal regulation of the transport of goods and passengers by sea are also caused by the fact that in some countries national legislation takes precedence over international law. It also creates confusion.
Moreover, using the rules established almost a hundred years ago is not practical, especially considering the changes in technology and international relations that have passed since then. Therefore, since 2009, new rules and standards have been developed, nicknamed the "Rotterdam". And although mostly developed countries have accepted and ratified, the creators believe that these provisions should be adopted and used everywhere. But most countries, including Russia, are in no hurry to recognize them. The reason is that not all provisions in this document are in the national interests of these countries.