Maritime Transport (Contracts of Carriage of Goods)

From Max-EuP 2012

by Peter Mankowski

1. Political and economic importance

Carriage of goods by sea is of considerable economic importance. It is the type of transport for bulk goods. For 2009, the total weight of goods handled in EU-27 maritime ports is estimated at 3.4 billion tons. Europe alone accounted for 1,456 billion tkm (tkm = ton × kilometres is the unit of measure for the transport of one ton payload over the distance of one kilometre). The United States, Japan, the People’s Republic of China and Russia accounted for 4,499.9 trillion tkm. Maritime transport by all modes of transport (next to inland waterway transport, which in 2009 totalled 119.8 billion tkm in the European inland traffic) produced the lowest cost per transported unit. Furthermore, the widespread use of containers guarantees a standardized, easy and quick handling of goods. Due to the size and weight of some goods, such as trucks or plant parts, ships are the only conceivable means of transporting other than railway transport. Carriage of goods by sea has a huge economic importance. This applies for export and import nations alike. The maritime industry, controlling the carriage of goods by sea, forms and dominates maritime regions and always codetermines where the centres of world trade are located. As a matter of nature and requirement, seaports are always commercial centres. The freight rates for long distance sea transport are still a good indication of world economic development.

2. Different kinds of contracts

Carriage of goods by sea encompasses various kinds of contracts. It may be a bulk goods contract of carriage, a contract of affreightment or, alternatively, a charterparty, particularly as a so-called voyage charter for individual trips.

3. Contracts of carriage

a) Function and differentiation

The ordinary contract for carriage of goods by sea is concluded between the carrier and the shipper. The subject of such contract is the carriage of goods. It does not have to be bulk goods in the traditional sense. Container transport can also be ‘goods’ in the legal sense. The characterization of the goods in terms of specific unit quantities is decisive regardless of whether measured in tons of bulk goods or containers to be transported. An important distinction is that the contract secures transport or particular journeys rather than the vessel being available for use for a certain period of time. Time charters, bareboat charters and other forms of boat rentals (more precisely: boat abandonments) are not contracts of carriage. Instead, transport to a particular destination is owed. The contract of carriage creates not only an obligation of effort, but rather obligations of success/achievement, namely success/achievement of the desired transport.

b) Parties

The carrier is the party who is obliged to perform the transport. The shipper is the counterparty, the creditor of the carriage as such and debtor of the reward. The contractual carrier does not have to transport the goods by his own means or personnel; he can also use a third party. Thus, in many instances there will be an actual carrier as well as the contractual carrier. The actual carrier is not a party to the contract of carriage with the shipper. Rather, he is party to his own subcontract of carriage, in which the carrier of the main contract is (sub-)shipper. Determining to what extent the actual carrier is liable to the shipper under the main contract, with whom there is no common contractual link, can generate complicated legal issues. In that regard, in accordance with the law which is applicable to the subcontract, there are exceptional instances in which the subcontract itself can provide the basis for claims for damages asserted by the main shipper. But more prevalent is the tortious liability of the actual carrier to the charterer, or more precisely, the legal owner of the goods. In addition, liability of the actual carrier may arise from the bill of lading if he appears in the bill of lading as the carrier.

In Germany there is another distinct party who acts in close connection to the shipper: the consignor, known specifically as a Drittablader, who actually delivers the goods to the vessel without being a formal party to the contract. This role is most likely performed by freight forwarders or warehouse (agents); the shipper’s own suppliers are also among the possible candidates.

4. Contracts of carriage and bills of lading

One has to distinguish between the actual contract of carriage and the bill of lading. The bill of lading provides title for delivery of the goods against the carrier. At the same time it is documentary evidence of the contract of carriage. The bill of lading is not identical to the contract. The bill of lading in particular does not generate claims for payment against the shipper or the consignee. Furthermore, under the bill of lading the carrier need not be identical to the carrier under the contract, namely if the contractual and actual carrier are distinct and the carrier of the contract of carriage transports on another’s vessel.

5. Contracts of affreightment (volume contracts)

The contract of affreightment or, in modern terminology, the volume contract (whereas the American term appears to be Ocean Service Liner Agreement) is a flexible phenomenon and does not follow a fixed standard. It combines elements of traditional charter forms and is widely used in dry mass transport, namely in the transportation of bulk goods. Basically, the following frequently occurring elements can be identified (see also Art 2 para 4 s 1 Hamburg Rules). The carrier assumes a generic and illustrative obligation to transport a specified amount of goods. There is no nomination of certain vessels. Usually a relatively larger quantity of goods is to be transported over a long period from a range of ports of departure to a range of ports of destination. The freight will be calculated according to weight or other measure, or alternatively on a lump sum basis. The carrier bears the risk of delay. The main difference to voyage charters (to which the contract of affreightment generally bears a close resemblance) is that there is no ex ante nomination of a specific vessel. In comparison to a consecutive voyage charter, the carrier usually has greater flexibility and can also otherwise plan ahead, since he is not bound to successive implementation of the voyages.

6. Voyage charter

In a voyage charter (charter party) the ship owner promises to transport goods—the vessel’s cargo in full or in part—for the charterer on one or more voyages in return for payment of the freight. Freight rates are calculated either on the basis of the quantity of cargo shipped or fixed at a gross sum (lump freight). Typical elements include: receipt of goods, performing the carriage and delivery of the goods at the port of destination. The identification of the port of loading, the port of destination and, usually, the goods to be transported are distinguishing features of the voyage charter in contrast to the time charter. Since the freight is calculated according to cargo oriented data, the owner bears—yet again in contrast to time charters—the risk of delay as the freight does not increase with a longer duration of the carriage. Depending on the number of trips agreed upon, there exist single voyage charters, multi-voyage charters and consecutive voyage charters. The consecutive voyage charter subjects several consecutive voyages to a common framework.

7. Sea waybills

Sea waybills emerged in the 1970s. Unlike bills of lading, a sea waybill does not constitute a legal relationship under, and independent from, the contract of carriage. Rather, it simply evidences claims stemming from the contract of carriage. It is not subject to the regimes specifically applicable to bills of lading, in particular neither to the Hague Rules nor the Hague Visby Rules. In contrast, the Hamburg Rules and the Rotterdam Rules encompass sea waybills as part of their scope of application as they regulate any contract on the carriage of goods by sea and not only bills of lading.

8. Uniform law

a) Multiplicity of competing regimes

Several conventions of uniform law address the carriage of goods by sea. Nonetheless, the most widely accepted regime is the Hague Rules of 1924. They regulate the liability stemming from a bill of lading. These Rules were amended by the Hague Visby Rules of 1968. But not all contracting states of the Hague Rules have also become contracting states of the Hague Visby Rules. Thus, it became further fragmented. In addition, two further Protocols to the Hague Visby Rules have been promulgated, to which in turn not all contracting states of the Hague Visby Rules have acceded. The more important of these Protocols is the Protocol of 1979, which converted the base for the liability amount from francs Poincaré to Special Drawing Right (SDRs) of the International Monetary Fund and thus from an outdated gold standard to a modern currency unit. In 1978 the United Nations presented the Hamburg Rules, to which the most important shipping nations have not acceded, though, as the rules’ liability standards were not at all popular with the shipping industry and the shipping lobbies exerted corresponding pressure. The rather belated entry into force of the Hamburg Rules—after 14 years—on 1 November 1992 is clear evidence of their disfavoured status. Even clearer evidence is the circle of contracting states. Specifically, the Hamburg Rules have seen their greatest popularity with importing nations and developing countries. Unlike the Hague and the Hague Visby Rules, the Hamburg Rules cover not only bills of lading but also contracts of carriage as such. Based on preparatory work by the Comité Maritime International (CMI), the most recent Convention is the so-called Rotterdam Rules of 2009 which try to supplement the unsuccessful Hamburg Rules under the auspices of UNCITRAL.

b) Specifics of the liability regimes under the Hague and Hague Visby Rules

Historically, at the time of their formulation in the 1910s and 1920s, the Hague Rules were an attempt to squash, and counter, the ever growing tendency by ocean carriers to exclude liability via B/L clauses. A mandatory regime aimed to suppress such practices. This generated as a central element the (unilaterally) mandatory nature of the carrier’s liability as the convention regimes should not be open for derogation by B/L clauses such that they would be rendered nugatory. Yet the Hague Rules and the Hague Visby Rules reflect a compromise in the design of liability regimes. This is evident from their exceptions.

A remarkable proprium is above all the privilege for what is termed nautical fault by Art 4(2)(a) Hague or Hague Visby Rules. Nautical fault means fault of the crew and servants in the navigating and handling of the transporting vessel. In that regard the carrier is liable only for his own, personal fault; but he is not responsible for the fault of crew and servants. Navigating the vessel includes any action relating to the locomotion as such, especially ship manoeuvres, lookout, carrying proper lights, (non-)inclusion of pilots or calling at ports of refuge. Handling of the vessel includes the technical handling of the vessel, eg handling and maintenance of the machinery or other equipment, which serves for the safety of the vessel, or the closing of the hatch cover. The opposite of nautical fault is so-called commercial fault. It includes measures taken in the interest of the cargo, not of the ship as such.

Navigare non solum necesse est, but it has its very own dangers. The carrier is not held liable for what are labelled perils of the sea. Perils of the sea comprise, in particular, foul weather and stormy seas. Collision and wreckage might be added. For cargo-related risks, eg those generated by the chemical consistency or explosive nature of the goods, the carrier ordinarily is not liable unless they are evidenced in the underlying contract and the carrier has specifically and knowingly agreed to take particular care.

c) Limitation of liability

Caps for the liability of the carrier are typical in maritime law. Such limitation of liability is a regular aspect of the political compromise between exporting nations and shipping nations. The shipping nations have to accept a mandatory liability of their shipping industry. The exporting nations in turn have to accept limitation of the liability to be imposed. In the event that a nation has both a significant shipping industry and a strong export trade, it has to balance this conflict of interest on the national level. The liability of limitation applies in general to the maximum amount per transported unit or per transported volume of weight. With the appearance of the container, a limitation of liability based solely on unit size risks devaluing claims of liability to the extent containers can be evaluated as a solitary unit. The original currency unit for limitation of liability was the Franc Poincaré, utilizing a gold standard. Today, it has been superseded by the Special Drawing Right (SDR) of the International Monetary Fund. The protocols to the Visby Rules are the clearest expression of this development. Even the Hamburg Rules include in Art 6 a limitation of liability. All limitation of liability operates ex lege without any precondition that the carrier needs to establish a fund or post any other security.

9. Union law

As is well known, Union law dedicates a title of primary law (Arts 90–100 TFEU/70–80 EC) to transportation. However, it should first be observed that this title does not affect the contract on the carriage of goods as such. Rather, it deals with the liberalization and opening of markets. The same holds true for the so-called Cabotage Regulation which basically aims to enable maritime carriage within a Member State by a carrier resident in another Member State. Secondly, maritime transportation is not automatically included. Rather, Art 100(2) TFEU/80(2) EC leaves it to the Council to decide by qualified majority whether, to which extent and by which procedure, appropriate regulation for the sector of maritime shipping might be implemented. The European Union has only recently developed a sharper focus on maritime law. Yet generally the existing uniform law regimes have implicitly been deemed sufficient. The European Union has not yet ratified or even signed any of the Conventions in the field of carriage of goods by sea. As to the Rotterdam Rules, only Spain has thus far ratified this convention, with six other Member States having signed it (as of July 2011). The European Parliament has issued a resolution calling on the EU Member States to sign and ratify the Rotterdam Rules whereas the Commission is considering an EU instrument on the multimodal transport of goods which would include sea carriage. Hence, the EU’s position at present (July 2011) is a case of mixed messages.

10. European private law

Carriage of goods by sea is too particularized a matter to turn explicitly towards European private law in its strict sense. Hence there are no specific rules on carriage of goods by sea to be found either in the Principles of European Contract Law (PECL) or in the ACQP or in the Draft Common Frame of Reference (DCFR). In addition, there is a good degree of adherence and respect for the uniform law which already dominates this area, leaving competing regulation appearing rather implausible.


Jürgen Basedow, Der Transportvertrag (1987); Bernd Laudien, Der Mengenvertrag im deutschen Seefrachtrecht (1992); Peter Mankowski, Seerechtliche Vertragsverhältnisse im Internationalen Privatrecht (1995); René Rodière and Emmanuel du Pontavice, Droit maritime (12th edn, 1997); Rolf Herber, Seehandelsrecht (1999); Guenter H Treitel and Francis MB Reynolds, Carver on Bills of Lading (2nd edn, 2005); Nicholas Gaskell, Regina Asariotis and Yvonne Baatz, Bills of Lading (2nd edn, 2005); Pierre Bonassies and Christian Scapel, Droit maritime (2006); Sergio M Carbone, Pierangelo Celle and Marco Lopez de Gonzalo, Diritto marittimo (3rd edn, 2006); Leopoldo Tullio, Contratto di noleggio (2006); Julian Cooke, Timothy Young, Andrew Taylor, John D Kimball, David Martowski and LeRoy Lambert, Voyage Charters (3rd edn, 2007); Paul Todd, Bills of Lading and Bankers’ Documentary Credits (4th edn, 2007); Stewart Boyd and others, Scrutton on Charterparties and Bills of Lading (21st edn, 2008); Terence Coghlin, Andrew Baker, Julian Kenny and John D Kimball, Time Charters (6th edn, 2008); <>; <>.

Retrieved from Maritime Transport (Contracts of Carriage of Goods) – Max-EuP 2012 on 18 May 2024.

Terms of Use

The Max Planck Encyclopedia of European Private Law, published as a print work in 2012, has been made freely available in 2021 as an online edition at <>.

The materials published here are subject to exclusive rights of use as held by the Max Planck Institute for Comparative and International Private Law and the publisher Oxford University Press; they may only be used for non-commercial purposes. Users may download, print, and make copies of the text files being made freely available to the public. Further, users may translate excerpts of the entries and cite them in the context of academic work, provided that the following requirements are met:

  • Use for non-commercial purposes
  • The textual integrity of each entry and its elements is maintained
  • Citation of the online reference according to academic standards, indicating the author, keyword title, work name, and date of retrieval (see Suggested Citation Style).