U.S., Europe shippers spar over Rotterdam Rules

U.S., Europe shippers spar over Rotterdam Rules    The National Industrial Transportation League, whose board of directors earlier this month passed a resolution supporting the new maritime cargo liability convention known as the “Rotterdam Rules,” on Friday issued a detailed response to criticisms the European Shippers' Council leveled against the proposed treaty.
   NIT League said it strongly disagrees with positions taken by the ESC in a paper issued in April, and said European recommendations “would perpetuate the application of outdated and inconsistent cargo liability rules around the world.”
   The NIT League's 17-page response can be found here.)
   The ESC, which is planning a conference on the Rotterdam Rules on June 22 in Antwerp, said it thought there were “inherent dangers” in the rules and that it might seek to prevent them from coming into force.
   In sharp contrast to the ESC, the NIT League “strongly supports ratification of the Rotterdam Rules both in the U.S. and globally,” and said “there are many new enhancements brought about by the Rotterdam Rules which would serve the interests of shippers involved in global trade.” These include:
   ' Eliminating the nautical defense that permits carriers to escape fault and liability based on negligent handling of the vessel.
   ' Expanding carriers' due diligence for the entire voyage by sea, not just at the beginning of the sailing.
   ' Increasing liability protections afforded to shippers at higher levels than under existing maritime cargo liability regimes, including Hague, Hague-Visby and Hamburg Rules.
   ' Eliminating limits of liability if the contracting carriers or maritime performing party engages in reckless or intentional acts.
   ' Including liability protection for shippers arising from economic losses incurred as a result of deliveries delayed beyond an agreed upon time in the amount of two-and-one-half times freight.
   ' Allowing shippers and carriers to contract for customized liability arrangements that reflect the shippers' individual business requirements.
   ' Permitting countries to opt-in to applying new rules governing jurisdiction and arbitration that would allow the claimant to select the place of adjudication of cargo claims in certain cases, based on a list of potential locations which bear some relationship to the involved contract of carriage.
   ' Extending the statute of limitations applicable to civil claims from one to two years.
   ' Recognizing the increasing use of electronic commerce for shipping transactions.
   “Taken as a whole, these benefits to the shipping community in the NITL's view directly contradict the ESC's contentions that shippers would be better served by the status quo, and that the new convention would place shippers in a worse position than that of the pre-1924 environment when the Hague Rules were first adopted,” the NIT League said.
   The Maritime Law Association of the United States also urged adoption of the Rotterdam Rules by the U.S. government during its annual meeting on May 1.
   The NIT League also said the ESC's desire to develop an European multimodal convention would 'be a giant step backwards, and would undermine the international community's attempt to update cargo liability rules applicable to sea carriage and increase efficiencies and harmony through the widespread adoption of a uniform regime. The Rotterdam Rules provide a readily obtainable opportunity to achieve these important objectives.'