Hague rules
International 1922 convention at The Hague (Netherlands) that established
standard basic obligations and responsibilities of the shipper and ocean-carrier for
goods covered under a bill of lading. These rules were the result of widespread
dissatisfaction among shippers and their insurers with arbitrary restrictions
imposed by carriers to limit their liability in case of loss of, or damage to, cargo.
These rules are followed by some 90 percent of nations and (after some changes)
the US adopted them in 1936 as Carriage Of Goods By Sea Act (COGSA).
Hague Rules of 1924
The Hague Rules represented the first attempt by the international community to
find a workable and uniform means of dealing with the problem of shipowners
regularly excluding themselves from all liability for loss or damage of cargo. The
objective of the Hague Rules has to establish a minimum mandatory liability of
carriers which could be derogated from.
Under the Hague Rules the shipper bears the cost of lost/damaged goods if they
cannot prove that the vessel was unseaworthy, improperly manned or unable to
safely transport and preserve the cargo, i.e. the carrier can avoid liability for risks
resulting from human errors provided they exercise due diligence and their vessel is
properly manned and seaworthy. These provisions have frequently been the subject
of discussion between shipowners and cargo interests on whether they provide an
appropriate balance in liability.
The Hague Rules form the basis of national legislation in almost all of the world's
major trading nations, and probably cover more than 90 per cent of world trade.
The Hague Rules have been updated by two protocols, but neither addressed the
basic liability provisions, which remain unchanged.
Hague-Visby rules
New name for the Hague rules as amended in 1968 at Visby (Sweden). Also called
The Brussels Protocol Of Amendments To The Hague Rules, these rules (ratified by
most nations except the US) increase a surface transport carrier's liability limit and
include containerized cargo under their provisions.
Hamburg rules
Hague-Visby rules amended under the auspices of UN Conference on Trade &
Development at Hamburg (Germany) in 1978, at the behest of the developing
countries. These rules make a surface transport carrier liable for all damage
resulting to cargo under the carrier's care, without limitation and without regard to
cause, unless it can be shown that the carrier took all reasonable measures required
to protect the cargo. However only 20 nations have approved Hamburg rules, with
notable exceptions such as the UK, USA, and other developed nations.