A1 + F2: International carrier liability – CMR

Act on Contracts for the Carriage of Goods in International Road Transport

This article deals with the responsibilities of carriers, including their employees, in connection with the performance of international freight transport operations for hire or reward.

Where does the law apply?

The Act on Contracts of Carriage for International Road Transport (CMR Act) applies when performing freight transport for hire or reward between states where at least one has acceded to the CMR Convention. You can see an overview of the CMR countries on the UN’s website, but in practice, all countries in Europe are included, and due to Denmark’s adherence to the rules, all transports to and from Denmark will always be covered.

The law covers transports carried out by a self-propelled vehicle with or without trailers. The law also applies even if part of the transport is carried out by plane, ship or rail, when the goods are not unloaded in this connection.

The law is first and foremost a law that protects the interests of transport buyers in safe transport and timely delivery of the goods. By making agreements, it is not possible to derogate from the provisions of the law, so that the customer is placed at a disadvantage compared to the law.

The Act does not apply to carriages covered by international postal conventions, funeral services and removals, as these transports are regulated by other legislations.

Carrier’s liability to others

The carrier is not the driver, as one might think. Carrier is a legal term that covers “the person who makes an agreement with the shipper for the transport of goods” This is a company that can issue an invoice. It can be a hauler, a freight forwarder, a freight center, or things like that, not the driver who is employed by the freight forwarder.

The carrier is responsible for the mistakes made by his employees, as well as the mistakes of everyone who helps him with the transport, for example another carrier, a warehouse or such. Responsibility for others is in the same way as if he had made the mistakes himself.

The conclusion and performance of the freight agreement.

The contract of carriage is confirmed by the creation of a consignment note, but the transport is subject to the CMR Act, even if the consignment note has not been created, is incorrectly filled in, or has been lost.

The consignment note shall be drawn up in triplicate and signed by the consignor and the carrier;

The first copy shall be delivered to the consignor, the second shall accompany the goods and the third shall retain the carrier.

Where the goods are loaded onto more than one vehicle, or in the case of different types of goods or separate lots, both the consignor and the carrier may require the creation of a consignment note for each vehicle, goods or lot.

Consignment notes and related information can be created electronically. The shipper and carrier must sign the waybills with a digital signature and must both have access to the information. Electronic waybills must be protected against alteration.

Foto: “CMR Convention” by Alinor

CMR countries

The consignment note shall contain the following information:

  • Sender’s Responsibilities:
  • place and day of creation,
  • the name and address of the consignor,
  • the place and day of taking over of the goods and the place of destination.
  • the name and address of the consignee,
  • the usual name for the nature and method of wrapping of the goods, in the case of dangerous goods, the generally accepted name.
  • the number of packages, their special marks, and their numbers,
  • the gross weight of the goods or any other expression of their quantity.
  • the necessary instructions for customs clearance and other formalities.

Where required, the consignment note shall also contain information on:

  • prohibition of reloading,
  • costs which the sender undertakes to pay.
  • cash on delivery amounts to be collected on delivery.
  • the declared value of the goods and the amount of a special interest in the delivery, cf. sections 30 and 33 of the CMR Act.
  • the consignor’s instructions to the carrier about insurance for the goods.
  • a time limit within which the contracted carriage must be completed.
  • a list of the documents made available to the carrier.

Carrier’s responsibilities:

  • the name and address of the carrier,
  • transport costs, such as freight, additional costs, customs duties, and other costs incurred between the conclusion of the contract and delivery.
  • declaration that, although otherwise agreed, the carriage is subject to the rules of the CMR Convention or the CMR Act.

The consignor shall be liable for the costs and damage caused to the carrier because of incorrect or incomplete information for which he is responsible. If it is the driver who has entered the information in the consignment note on behalf of the carrier, then he is considered to have acted on behalf of the consignor, unless you can prove otherwise.

Carrier’s duty to investigate.

When you as a carrier take over goods for transport, you are obliged to check whether the goods you are loading are in accordance with the waybill. One must check whether the number of packages and their numbers and marks are correct. The visible condition of the goods must also be examined.

What is meant by visible state?

Immediately, of course, what you can see with your eyes. Are the goods or packaging damaged? But the concept of visible state should be understood more broadly, including sense of smell and hearing. Is there bad smell? Does liquid flow from the cargo? Or does the goods sound damaged when moved? Then a reservation must be made about it. The driver is not required to have special equipment or knowledge of the goods.

As far as the packaging of the goods is concerned, the driver must examine its visible condition. Damage, dents, or holes may indicate that the goods are damaged and therefore reservations must be made in the waybill. On the other hand, the driver does not have to assess the suitability of the packaging for the transport in question. Only in cases where the goods are wrapped grossly recklessly or are not wrapped at all, reservations must be made.

If the above examination cannot be carried out, the driver must make a reasoned reservation on behalf of the carrier. Please note that reservations on the consignment note are not binding on the consignor unless he has expressly approved them in the consignment note. It is therefore not possible to make reservations on the consignment note after the consignor has signed and received his copy of the consignment note.

Probative value of the consignment note.

If, when examining the goods, it has become apparent that it is necessary to make a reservation, it must be written specifically and justified in the waybill. A standard reservation is not sufficient and will therefore not meet the requirements. The reservation must be precise so that there is no doubt about what reservations are being made. It happens all too often that it only says that the goods or packaging are damaged and nothing about how. For example, are there scratches, dents, or something else? How many packages were loaded in relation to the information in the waybill?

If no reasoned reservation is made in the consignment note, it is presumed that the goods and their packaging were in good condition when the carrier took them over and that the number of packages and their marks and numbers corresponded to the information on the consignment note. However, the carrier may escape liability by proving in other ways that the liability does not lie with him. It is therefore a question of reversing the burden of proof. If he wants to take advantage of this opportunity, then there could be other documentation in the form of pictures, testimony or something else.

Dangerous goods

If the consignor wishes to transport dangerous goods, he shall inform the carrier of the precise nature of the danger and, if necessary, the rules to be followed.

If dangerous goods are loaded without the carrier’s knowledge, he may unload, destroy, or render the goods harmless at anytime and anywhere without any obligation to pay compensation.

The shipper is liable for costs and damage resulting from the goods being handed over for carriage.

Right of disposal

The consignor normally has the right to dispose of the goods. He may suspend the transport, change his destination, or have the goods delivered to another consignee. If the goods are lost, it is the shipper who is entitled to any insurance amounts.

The right of disposal and the right to any amounts of insurance shall pass to the beneficiary once he has received the consignment note. This also applies even if the goods are not unloaded, or the goods are unloaded.

However, the recipient may have the right of disposal already from the time the waybill is created if the sender writes this in the waybill. In this case, the shipper cannot change the transport process.

Carrier’s responsibilities

Conditions of liability and burden of proof

The carrier is responsible for loss and damage to the goods from the time he takes it over until delivery has taken place.

He is also responsible for costs related to late delivery.

However, the carrier shall not be liable if the loss, damage, or delay is due to fault or negligence on the part of the sender. This means that if the information that the sender has written in the consignment note is not correct or if the goods are not packaged in a way that can withstand the transport, then the carrier does not have to pay compensation.

The carrier is also free from liability if the damage occurs due to the nature of the goods themselves. For example, goods that are particularly susceptible to destruction or damage, especially by rust, spoilage, drying out, leakage, normal shrinkage or attack by vermin and rodents.

The carrier is also exempt from liability if he can prove that the damage or delay occurred under conditions that the carrier could not avoid and that he could not avert the consequences (force majeure). For example, it could be a delay that has occurred as a result of a professional blockade, a major traffic accident or the like. However, the carrier cannot escape his responsibility by referring to defects in the vehicle he uses for transport, even if he has rented the vehicle.

The carrier is also responsible if the goods have not been delivered at the agreed time. However, if damage has occurred because of delay, the carrier must pay a maximum of compensation equal to what he has received for the transport.

There is a delay in delivery when the goods have not been delivered at the agreed time, or if a delivery time has not been agreed, the time that is normal in the transport industry.

If the delay is more than 30 days in relation to an agreed delivery time or 60 days when no delivery time has been agreed, then the goods are considered to have been lost and the carrier must pay compensation as if the goods had been lost.

Amount of compensation.

In the event of loss or damage of the goods, the carrier must pay the value of the goods or, in the event of damage, he must pay the decrease in value. The compensation cannot normally exceed 8.33 SDRs, per kg. gross weight unless it has been agreed with the shipper that the amount must be higher or if the carrier has acted grossly negligently. Examples of gross negligence include: Loading of stolen goods in a tarpaulin trailer, Theft in connection with accommodation and parking in exposed areas, Leave the vehicle unlocked, In case of gross negligence, the carrier cannot limit his compensation to 8.33 SDRs.

What is SDR?

SDR means “Special Drawing Rights” in English, is a “fictitious” currency in the sense that it does not exist as either banknotes or coins and cannot be used as a means of payment. SDRs have been issued since 1970 by the International Monetary Fund (IMF) with the aim of allowing member countries to borrow to obtain foreign exchange reserves in international trade. Today, however, the Member States’ loan facilities are so good that most countries do not need to draw on the International Monetary Fund. It is therefore more of a unit of account in international trade, and thus also to determine the amount of liability in the CMR Act Why not just fix the value in US Dollar or EURO? The rate of SDR is not as volatile as a country’s exchange rate can be since the rate of SDR is calculated on the total value of 4 major currencies. If one of the currencies changes slightly, then it affects only to a lesser extent the overall rate. The value of SDRs shall be determined as the total value of the exchange rates by:. US Dollar Euro Japanese yen British pounds. the value is calculated daily except on Sundays and public holidays, and is shown in exchange rates for business, for example at www.nationalbanken.dk.The exchange rate usually fluctuates between DKK 850 and 950 for 100 SDRs. This means that 8.33 SDRs fluctuate between DKK 70 and 80 under normal conditions.