The CMR Convention Kabul, 24 August 2015 Nazife Bulut, Legal adviser - Insurance.

The CMR ConventionKabul, 24 August 2015

Nazife Bulut, Legal adviser - Insurance

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Convention on the Contract for the International Carriage of Goods by Road (CMR), 1956

1956 CMR Convention

1978 Protocol (SDR) Additional “e-CMR”

Protocol in 2008 (entered into force in 2011)

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To facilitate trade and road transport:

Harmonised contractual conditions and documents

CMR

Harmonised Customs procedures

TIR

Harmonisation and mutual recognition

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Convention on the Contract for the International Carriage of Goods by Road (CMR), 1956

Objective:

Standardize the conditions governing the contract for the international carriage of goods by road, particularly with respect to:

• Documents used for such carriage

• Carrier's liability

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Contracting Parties to the CMR

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CMR Convention:

8 ECO countries:

- Azerbaijan- Iran (Islamic

Republic of)- Kazakhstan- Kyrgyzstan- Tajikistan- Turkey- Turkmenistan- Uzbekistan

ECO Contracting Parties to the CMR

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Why CMR is key?

Without harmonised contractual conditions for international road transport:

o How and when the contract is concluded?o What is the form and the nature of the contract?o Which law will govern the contract?o Which are the parties’ respective obligations?o What procedures to follow in case of delay, or damage,

or non-delivery?o Which level of indemnity should apply?o What is the content of transport documents?

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Why CMR is key?

Without harmonised contractual conditions for international road transport:

o Road transport operators, shippers and consignees would not be in a position to measure their commercial / financial exposure UNPREDICTABILITY

o Difficulty for insurers to assess risk and provide coverage

o Open door to « à la carte » contracts and legal uncertainty

o Unclear rules for establishing transport documents

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Key Objectives - Benefits of the CMR

BENEFITS FOR FACILITATION

Harmonisation of contractual and liability conditions

Facilitation and harmonisation of claims and recovery procedures

Harmonisation of competitive conditions

Rationalisation of transport costs and harmonisation of insurance conditions

Standardisation of transport documents: CMR note

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Key Objectives - Benefits of the CMR

BENEFITS FOR SECURITY

CMR Consignment Note facilitates commercial transparency

Identification of Parties to the transport contract and main transport conditions

Facilitation of controls by the contractual partners and by the Authorities

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1. CMR generalities

2. Obligations of the parties under the CMR

3. Delivery under the CMR

4. Conditions and limits of liability under the CMR

5. Handling of claims under the CMR

6. Insurance and CMR

TABLE OF CONTENT

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1. CMR generalities: The scope of the CMR

Contract between the sender and the carrier for the international carriage of goods by road for reward

• covers successive movements

• addresses multimodality: applies to carriage by ferries and using combined transport for door to door movements

• excludes all contradictory clauses

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3 original copies (article 5):• one for the consignee• one for the shipper• one for the carrier

Signature = proofof acceptance of the CMR conditions

* Other models can be used

Model CMR consignment note developed by the IRU*

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+ the international consignment note

+ incidents en route

+ claims and compensation for delay, damage and loss

+ the international consignment note

+ incidents en route

+ claims and compensation for delay, damage and loss

1. CMR generalities: The scope of the CMR

Taking the goods over Delivery

TransportTransport

National legislation General conditions

National legislation General conditions

Loading/ unloading/ charges

?

Loading/ unloading/ charges

?

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1. CMR generalities: Application of the CMR

Application

CMR applies to every contract for the international carriage of goods by road in vehicles for reward between two different countries of which at least one is a Contracting country and also when carriage is carried out by States or by governmental institutions or organizations (Article 1 of the CMR Convention)

Exemption

CMR shall not apply :

X To carriage performed under the terms of any international postal

convention;

X To funeral consignments;

X To furniture removal

(Article 1.4 of the CMR Convention)

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1. CMR generalities:How the CMR fits into the general legal environment

CMRNational legislation

Contractual areaGeneral environment

customs transport social new technologies

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Defines contract conditions

Documentary requirements, responsibilities and liability of the carrier and the sender, burden of proof, delay in delivery, compensation and its limits, interests, claims and actions.

Defines the indemnity limits in SDR (Special Drawing Rights) and defines the conversion rules from SDR to local currency *The SDR is an international reserve asset, created by the International Monetary Fund (IMF) in 1969 to supplement its member countries’ official reserves. Its value is based on a basket of four key international currencies, and SDRs can be exchanged for freely usable currencies

1. CMR generalities: Key Provisions

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Before taking over the goods

Senderpackaging informationdocumentsdangerous goods (Article 22.1 of the CMR Convention)

Carrier: Checkstally number, markings and

numbers on packagesapparent condition and packaging the gross weight of the goods and the contents of the packages if

requested by the sender but at his expense (Article 8.3 of the CMR Convention)

Making out the CMR consignment note

Liable for all loss and damage sustained by reason of the inaccuracy or inadequacy of certain particulars or documents (Articles 7 and 11 of the CMR Convention)

Liable for all loss and damage sustained by reason of the inaccuracy or inadequacy of certain particulars or documents (Articles 7 and 11 of the CMR Convention)

Presumption of good condition (Article 8.2)Presumption of good condition (Article 8.2)

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During carriage

Sender

has a right to dispose of the goods (Article 12 of the CMR Convention)

Carrier

keeps, delivers or returns the documents provided by the sender (Article 11 of the CMR Convention)

notifies, in the event of an incident in particular

accepts instructions

safeguards the goods

particular case of dangerous goods

(Article 14 of the CMR Convention)

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3. Delivery under the CMR

No definition of delivery in the CMR

national law applicable

No definition of delivery in the CMR

national law applicable

If delivery is prevented the Carrier notifies and asks for instructions (Article 15 of the CMR Convention)

If no instruction is given, the Carrier may:

• immediate unload (Article 16.2 of the CMR Convention)

• sell the goods (Articles 16.3, 4 and 5 of the CMR Convention)

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Fundamental principles of the CMR:

Presumption of liability of the Carrier - strict liability (obligation of result)

(Articles 3, 17.1, 11.3 and 12.7 of the CMR Convention)

Liability for his agents and servants

(Articles 29.1 and 29.2 of the CMR Convention)

Limited compensation



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Liability of the carrier for

• partial or total loss

• damage

• delay

which arises between the taking over and delivery of the goods

But relief of his liability if proof that loss, damage or delay caused in certain circumstances

(Article 17 of the CMR Convention: loss, damage and delay)

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Carrier’s liability relieved in certain cases if proof that loss or damage attributed to a special risk:

• use of open vehicles and vehicles not sheeted in accordance with the CMR

• handling by the sender or the consignee

• the nature of certain kinds of goods which exposes them to the risk of rust, breakage or decay

• insufficiency or inadequacy of marks or numbers on the packages, etc.

But the claimant may prove the contrary: reversal of the burden of proof

(Article 18 of the CMR Convention: loss and damage)

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Delays when: o exceeding the time-limit agreed

or

o exceeding the time it would be reasonable to allow a diligent carrier


o 30 days after the expiry of the time-limit agreed

or

o 60 days from the time when the carrier took over the goods



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Loss and damage

Compensated loss: loss and damage to property Amount: 8.33 SDR per kg of goods lost or damaged

o unless a higher value has been declared

o reference value: value of the goods at the place and time at which they were accepted for carriage

+ - carriage charges - customs duties

- other charges in full or in proportion

(Articles 23 and 24 of the CMR Convention)

Delay

Proof that the delay has caused a loss by the Claimant Compensation limited to the carriage charges


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Loss, damage and delay

Higher compensation if a special interest in delivery declared


No limit or no exclusion of liability if

• wilful misconduct by the carrier

• or default equivalent to wilful misconduct


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Protection of rights

Loss and damage

• joint examination at the time of delivery

• for loss or damage which is apparent: if no reservation or report on the loss or damage, presumption that delivery in line with the consignment note BUT CLAIMS ARE NOT BARRED

• for loss or damage which is not apparent: written notification within 7 days of delivery

Delay

• written reservations within 21 days from the time that the goods were placed at the disposal of the consignee. OTHERWISE BARRED



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Period of limitation

• 1 year or

• 3 years if wilful misconduct or default equivalent to it Starting from

• date of delivery (partial loss, damage or delay)

• 30 days after the expiry of the time-limit agreed (total loss) or 60 days after goods taken over by the carrier

• other cases: three months after the conclusion of the contract Suspension

• written claim by the claimant Recommencement of the period of limitation

• written rejection of the claim by the carrier and the return of the documents


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Competent courts

Arbitration Tribunal if existence of a clause providing application of the CMR by the Tribunal

In the absence of specific clause on competent courts:

• courts of the country in which the defendant is resident or• courts of the country in which the goods were taken over or

were to be delivered

(Articles 31 and 33 of the CMR Convention)

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6. Insurance and CMR

Facilitation of insurance coverage through harmonisation of contractual conditions with CMR

Measurement of risks simplified for Insurers as not exposed to unknown conditions of transport

Insurers benefit from harmonised claims procedures and liability limits

and premiums Better insurance conditions and premiums

The CMR Convention Kabul, 24 August 2015 Nazife Bulut, Legal adviser - Insurance.

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