The increasing interconnectedness of global trade has amplified the significance
of efficient and streamlined logistics. Multimodal transportation, which
involves the movement of goods using a combination of transport modes such as
rail, road, sea, and air under a single contract, has emerged as a crucial
element in optimizing logistics processes 1. This approach facilitates faster
transit of goods and mitigates the disadvantages associated with geographical
distances, proving particularly effective in large and diverse nations like
India for ensuring seamless end-to-end delivery 1.
The growing reliance on
multimodal transport underscores the imperative for a robust and transparent
legal framework governing liability to ensure the smooth functioning of trade
operations. As trade volumes expand and supply chains become increasingly
intricate, the potential for disputes concerning liability also rises, making a
well-defined legal regime essential for providing predictability and reducing
transaction costs.
The efficiency and security inherent in multimodal transportation are
intrinsically linked to the clarity and effectiveness of the liability regime
that governs it 3. A well-articulated legal framework ensures that
responsibilities are assigned effectively, incentivizing stakeholders to adopt
necessary precautions and guaranteeing fair compensation in the event of loss or
damage.
Conversely, ambiguities or deficiencies within the liability framework
can precipitate disputes, elevate insurance expenses, and potentially deter the
adoption of multimodal transport, thereby impeding overall trade efficiency.
Shippers require the assurance that their goods are adequately protected
throughout their journey, while Multimodal Transport Operators (MTOs)
necessitate clarity regarding their responsibilities and potential liabilities.
In India, the Multimodal Transportation of Goods Act, 1993, was enacted with the
primary objective of establishing a liability regime for MTOs 4. This
legislation aimed to introduce a uniform system to address the ambiguities and
imbalances of interests that existed between operators and cargo owners under
the conventional system of separate contracts for each mode of transport 3.
The
intent behind this Act was to create a specific legal framework tailored to the
unique challenges and complexities of multimodal transport, thereby simplifying
the process for shippers by assigning responsibility to a single entity, the MTO,
for the entire transportation process and its associated liabilities. While the
Act represented a significant step towards creating a dedicated legal structure
for multimodal transport in India, its effectiveness in addressing contemporary
challenges, its alignment with evolving international practices, and the
interpretations rendered by the judiciary warrant a thorough and critical
examination, which forms the core of this report.
Legal Framework for Multimodal Transportation in India
The evolution of transportation laws in India has been a gradual process,
reflecting the changing needs of the economy and the growth of trade. Indian
Railways played a pivotal role in the early promotion of multimodal transport,
initiating containerization of goods in 1966 and subsequently developing Inland
Container Depots (ICDs) 2.
The establishment of the Container Corporation of
India (CONCOR) in 1988 further strengthened the infrastructure for inland
movement of containerized cargo 2. Recognizing the increasing importance of
integrated logistics solutions, the Indian Parliament passed the Multimodal
Transport Act in 1993 to establish a standardized regime for MTOs, designating
the Director General of Shipping as the competent authority for its
implementation 2.
This legislative development aimed to formalize the legal
framework for multimodal transport, moving towards a unified approach to manage
transportation across various modes. Understanding this historical progression
is crucial for appreciating the context in which the 1993 Act was formulated and
for identifying areas where it might require updating to address the
complexities of the current global logistics landscape.
The Multimodal Transportation of Goods Act, 1993, provides key definitions that
are central to understanding the liability framework. The Act defines a
"carrier" as any person undertaking to perform carriage of goods by road, rail,
inland waterways, sea, or air, and a "consignor" as the person entrusting goods
to an MTO 6. The "consignee" is the person named in the multimodal transport
contract to receive the goods, and the "consignment" refers to the goods
entrusted to the MTO for multimodal transportation 6.
"Multimodal
transportation" is defined as the carriage of goods by at least two different
modes of transport under a single contract from the place of acceptance in India
to a place of delivery outside India 6. A "multimodal transport contract" is an
agreement where an MTO undertakes to perform or procure the performance of
multimodal transportation against payment of freight 6. Crucially, a "multimodal
transport operator" is defined as any person who concludes a multimodal
transport contract on their own behalf, acts as a principal (not as an agent),
and is registered under the Act 6. The Act also distinguishes between
"negotiable" and "non-negotiable" multimodal transport documents 7.
These clear
legal definitions of the key entities and activities involved in multimodal
transport are fundamental for establishing a coherent framework for liability,
reducing ambiguity, and providing a common understanding for all stakeholders.
However, the Act's definition of "multimodal transportation" specifically
mentioning transport from India to outside India has raised questions about its
applicability to purely domestic multimodal transport, as highlighted in
judicial interpretations.
Despite the establishment of this legal framework, India continues to face
significant challenges in developing an efficient and seamless multimodal
logistics system. These challenges include high logistics costs, which remain
considerably higher than global benchmarks 5. The transportation modal mix is
also skewed, with a heavy reliance on road freight compared to more developed
economies 5. Procedural complexities, involving multiple government agencies and
mandatory approvals, further hinder the ease of doing business in this sector 5.
A disintegrated network, skill gaps in managing advanced logistics operations,
and coordination issues among different modes of transport also pose substantial
obstacles 4.
These underlying logistical challenges can indirectly impact the
application and effectiveness of the liability regime under the Act.
Inefficiencies in infrastructure and coordination can lead to a higher risk of
loss, damage, and delay, potentially increasing liability claims and
underscoring the need for a robust legal framework to address these issues in
practice.
Analysis of Liability Provisions under the Multimodal Transportation of Goods
Act, 1993
The Multimodal Transportation of Goods Act, 1993, lays down specific provisions
regarding the liability of the MTO. Section 13 of the Act establishes the basis
of liability, stating that the MTO is liable for loss or damage to the
consignment and for delay in delivery that occurs while the goods are in their
charge 6. This liability is based on the principle of presumed fault or neglect
on the part of the MTO or their servants or agents 7.
The burden of proof rests
on the MTO to demonstrate that the loss, damage, or delay was not attributable
to any fault or neglect on their part 7. This approach generally favors the
shipper, as the MTO has greater control over the transportation process and is
thus expected to provide evidence of due diligence. The effectiveness of this
provision, however, depends on the MTO's ability to maintain adequate
documentation of their processes and to convincingly prove the absence of
negligence.
Regarding liability for delay in delivery, Section 16 of the Act specifies that
the MTO is not liable for loss or damage arising from delay, including
consequential loss, unless the consignor has made a declaration of interest in
timely delivery, which has been accepted by the MTO 6. The Act defines delay in
delivery as occurring when the consignment is not delivered within the time
expressly agreed upon, or in the absence of such agreement, within a reasonable
time expected of a diligent MTO under the circumstances 7.
Furthermore, if the
consignment is not delivered within ninety consecutive days following the agreed
or reasonable delivery time, the claimant is entitled to consider the
consignment as lost 6. These provisions set specific conditions for holding the MTO liable for delays, aiming to protect the MTO from potentially extensive
claims for consequential losses when they were not explicitly informed of the
critical nature of timely delivery. The interpretation of "reasonable time" in
the absence of an express agreement can, however, be a potential source of
disputes, requiring judicial consideration based on the specifics of each case.
Sections 14 and 15 of the Act outline the limits of liability for the MTO.
Section 14 applies when the nature and value of the consignment have not been
declared by the consignor before the MTO takes charge, and the stage of
transport where the loss or damage occurred is unknown 7. In such cases, the
MTO's liability is limited to the higher of two Special Drawing Rights (SDRs)
per kilogram of the gross weight of the lost or damaged consignment or 666.67
SDRs per package or unit lost or damaged 6.
For multimodal transport that does
not include carriage by sea or inland waterways, the liability is further
limited to 8.33 SDRs per kilogram of the gross weight of the goods lost or
damaged 6. Section 15 addresses situations where the nature and value of the
consignment were not declared, but the stage of transport where the loss or
damage occurred is known 7.
In such instances, the MTO's liability is determined
by the relevant law applicable to that specific mode of transport during which
the loss or damage occurred 6. Any stipulation in the multimodal transport
contract to the contrary is void 7. This dual system of liability limits, based
on declared value and the knowledge of the stage of loss, seeks to balance the
interests of both shippers and MTOs. The adoption of SDRs aligns with
international practices in transport law. However, the application of unimodal
limits under Section 15 can introduce complexity, particularly in identifying
the precise stage of loss in transports involving multiple modes.
Section 18 of the Act deals with the loss of the right to limit liability. It
stipulates that the MTO cannot avail themselves of the limitation of liability
if it is proven that the loss, damage, or delay in delivery resulted from an act
or omission by the MTO done with the intent to cause such loss, damage, or
delay, or recklessly and with knowledge that such a result would probably occur
6.
This provision ensures that MTOs are held fully accountable for their
intentional misconduct or gross negligence and cannot seek refuge under the
liability limitations provided in the Act in such cases. Proving such intent or
recklessness, however, can be a significant challenge for the claimant, and
judicial interpretations play a crucial role in defining the threshold for such
acts or omissions.
Section 20A of the Act defines the period of responsibility of the MTO, stating
that it covers the time from when the MTO takes the goods in their charge until
the time of their delivery 6. This "door-to-door" responsibility is a
fundamental characteristic of multimodal transport, reinforcing the MTO's role
as the single entity accountable for the entire transportation process. Defining
the precise moments of "taking charge" and "delivery" can sometimes be complex
in practice and may necessitate clear contractual terms or judicial
clarification in case of disputes.
Finally, Section 20 of the Act outlines the requirements for notice of loss or
damage. It states that the delivery of the consignment to the consignee by the
MTO is considered prima facie evidence of delivery as described in the
multimodal transport document, unless the consignee provides written notice of
the general nature of loss or damage to the MTO at the time of handover 6. If
the loss or damage is not apparent, the same applies unless written notice is
given by the consignee within six consecutive days after the goods were handed
over 6.
These provisions establish a timeframe for the consignee to notify the MTO of any issues with the delivered goods, allowing the MTO to conduct timely
investigations and potentially mitigate further losses. Failure to adhere to
these notice requirements can potentially weaken the consignee's claim against
the MTO.
Comparison with International Liability Regimes
To gain a broader perspective on the Indian liability regime, it is essential to
compare it with key international frameworks, namely the Rotterdam Rules and the
UNCTAD/ICC Rules for Multimodal Transport Documents.
The Rotterdam Rules, formally known as the United Nations Convention on
Contracts for the International Carriage of Goods Wholly or Partly by Sea,
represent a modern attempt to harmonize the rules governing international
contracts for the transportation of goods, particularly those involving a sea
leg 9. Their scope is broader than previous maritime conventions, covering
carriage in the liner trade even in the absence of a bill of lading, and
applying to shipments to or from a contracting state 11.
A key feature of the
Rotterdam Rules is their adoption of a "door-to-door" period of responsibility,
commencing when the carrier receives the goods and ending when they are
delivered 10. This aligns with the modern realities of multimodal transport.
Notably, the Rotterdam Rules eliminate the "nautical fault defense," which had
historically protected carriers from liability for negligence in the navigation
or management of the ship 10.
The liability limits under the Rotterdam Rules are
also increased compared to older regimes, set at the greater of 875 SDR per
package or shipping unit, or 3 SDR per kilogram 10. Furthermore, they adopt a
more flexible approach to the apportionment of damages when multiple causes
contribute to a loss 11. The time limit for bringing a lawsuit under the
Rotterdam Rules is two years, longer than the one year under COGSA 10. While the
Rotterdam Rules represent a significant modernization of international transport
law, they are not yet in force due to a limited number of ratifications 9.
The
UNCTAD/ICC Rules for Multimodal Transport Documents offer a different
approach as they are a set of standard contractual terms that parties can
incorporate into their multimodal transport contracts 13. These rules are based
on the Hague Rules and Hague-Visby Rules and are compatible with the Uniform
Customs and Practice for Documentary Credits (UCP) 13. The basis of liability
under these rules is presumed fault on the part of the MTO 13. Similar to the
Indian Act, the MTO is responsible for the acts and omissions of their servants,
agents, and subcontractors 15.
The liability limits, unless a higher value is
declared, are set at 666.67 SDR per package or shipping unit, or 2 SDR per
kilogram, whichever is higher. For transport that does not include sea or inland
waterways, the limit is 8.33 SDR per kilogram 13. Notably, the UNCTAD/ICC Rules
incorporate a network liability system, meaning that when the stage where loss
or damage occurred is known, the MTO's liability can be determined by reference
to the applicable international convention or mandatory national law that would
have applied if a separate contract had been made for that stage 13.
Liability
for delay and consequential loss is limited to the freight under the multimodal
transport contract 13. The MTO loses the right to limit liability if the loss,
damage, or delay resulted from a personal act or omission done with the intent
to cause such consequences or recklessly with knowledge that they would probably
result 13. As these rules are contractual, their application depends on their
incorporation into the transport agreement and they are subject to any
applicable mandatory law 14.
Feature |
Multimodal Transportation of Goods Act, 1993
(India) |
Rotterdam Rules |
UNCTAD/ICC Rules for Multimodal Transport
Documents |
Scope of Application |
International transport from India |
International carriage wholly or partly by sea; multimodal
with sea leg |
Contractual; worldwide application |
Period of Responsibility |
Taking charge to delivery ("door-to-door") |
Receiving to delivery ("door-to-door") |
Taking charge to delivery |
Basis of Liability |
Presumed fault or neglect |
Fault-based |
Presumed fault or neglect |
Nautical Fault Defense |
Not explicitly addressed |
Eliminated |
Available for sea/inland waterway carriage |
Liability Limit (General) |
Higher of 2 SDR/kg or 666.67 SDR/package (8.33 SDR/kg if no
sea/inland waterway) |
Higher of 3 SDR/kg or 875 SDR/package |
Higher of 2 SDR/kg or 666.67 SDR/package (8.33 SDR/kg if no
sea/inland waterway) |
Liability for Delay |
Limited to freight payable (unless declared interest) |
Limited to 2.5 times freight (with overall cap) |
Limited to freight payable |
Loss of Limitation |
Intentional or reckless act/omission |
Intentional or reckless act/omission |
Intentional or reckless act/omission |
Time Limit for Claims |
9 months |
2 years |
9 months (unless otherwise agreed) |
Liability System |
Modified Uniform (with network element in Sec 15) |
Uniform |
Network |
Network Liability vs. Uniform Liability System
The liability framework in multimodal transport can be broadly categorized into
two systems: network liability and uniform liability. The network liability
system operates on the principle that the liability of the MTO for loss or
damage is determined by the existing mandatory rules governing the specific mode
of transport on which the loss or damage occurred 16.
For instance, if goods are
damaged during the sea carriage segment, the liability would be determined under
maritime conventions like the Hague/Hague-Visby Rules, while damage during road
transport would be subject to road carriage conventions like the CMR 16. This
system essentially treats the multimodal transport as a series of unimodal
transports, each governed by its own set of rules.
In contrast, the uniform liability system applies a single, consistent set of
liability rules to the entire multimodal transport operation, irrespective of
the mode of transport being used or the stage at which the loss or damage occurs
8. This system aims for simplicity and predictability by subjecting the entire
contract to a single body of provisions.
The Multimodal Transportation of Goods Act, 1993, adopts a modified uniform
liability system 8. While the Act establishes a general basis of liability for
the MTO for the entire period of responsibility, Section 15 introduces an
element of network liability. According to Section 15, if the stage of transport
where the loss or damage to an undeclared consignment occurred is known, the
MTO's liability is determined by the relevant law applicable to that specific
mode of transport, especially concerning the limits of liability 6. This
indicates that while the Act provides a primary liability framework applicable
throughout the multimodal journey, it defers to the specific liability rules of
individual modes when the stage of loss is identified and those rules provide a
different liability regime.
This modified uniform approach presents both advantages and disadvantages for
stakeholders in India. The uniform aspects offer simplicity and a single point
of responsibility for shippers, particularly in cases where the stage of loss
cannot be easily determined 17. However, the network element introduced by
Section 15 can lead to complexities in ascertaining the applicable law and
potentially result in varying levels of compensation depending on the mode of
transport where the loss occurred and the specific liability limits under that
mode's governing law.
For MTOs, this system requires them to be knowledgeable
about the liability regimes of all the modes of transport they utilize.
Potential inconsistencies can also arise if the time limits for claims under the
Multimodal Act differ from those under the applicable unimodal conventions,
potentially creating recourse gaps for MTOs 19. Therefore, while the modified
uniform system attempts to balance simplicity with the recognition of specific
unimodal rules, it necessitates careful consideration of the interplay between
the general provisions of the Act and the specific provisions of other transport
laws to fully understand the rights and obligations of all parties involved.
Role and Responsibilities of the Multimodal Transport Operator (MTO) and their
Liability
Under the Multimodal Transportation of Goods Act, 1993, the Multimodal Transport
Operator (MTO) assumes a central role with significant responsibilities. The Act
clearly defines the MTO as a person who concludes a multimodal transport
contract on their own behalf, acting as a principal and not merely as an agent
for the consignor or the underlying carriers 3.
This principal role signifies
that the MTO accepts full responsibility and liability for the performance of
the entire transportation contract, acting as the single point of contact for
the shipper 3. The MTO is responsible for managing the entire transport
operation from the place of acceptance of the goods to the place of delivery,
coordinating all necessary modes of transport and handling all matters related
to the goods, including potential delays 1.
A key responsibility of the MTO is their liability for loss or damage to the
goods that occurs during their period of responsibility, which extends from the
time they take the goods in charge until the time of delivery 6. This liability
is established under Section 13 of the Act, based on the principle of presumed
fault or neglect, as discussed earlier. The MTO is accountable for ensuring the
safe and timely delivery of the goods across all the modes of transport involved
in the multimodal journey.
Furthermore, the Act mandates that any person carrying on the business of
multimodal transportation must be registered under the Act 2. This registration
requirement underscores the regulatory intent to ensure that only competent and
financially sound entities operate as MTOs in India. The conditions for
registration include being a company, firm, or proprietary concern engaged in
shipping or freight forwarding with a minimum annual turnover 3.
The Director
General of Shipping has been notified as the competent authority for granting
registration 5. This mandatory registration aims to protect the interests of
shippers by ensuring that MTOs possess the necessary expertise, infrastructure,
and financial capability to undertake multimodal transport and meet potential
liability claims. Operating as an unregistered MTO is explicitly prohibited
under the Act 3.
Judicial Trends and Interpretations of Liability Provisions in India
Indian courts have had the opportunity to interpret the liability provisions of
the Multimodal Transportation of Goods Act, 1993, in various cases, providing
valuable insights into the practical application of the Act.
In the case of
Rameshwar Dass & Sons v. Caravel Logistics Pvt. Ltd. 25, the
Delhi High Court examined the applicability of the Act in the context of
arbitration. The court noted that while Section 26 of the Act provides freedom
to parties to agree on jurisdiction, the Act does not explicitly mandate the
referral of disputes related to multimodal transportation to arbitration. This
interpretation suggests that while the Act governs liability, other aspects of
dispute resolution might require separate agreements or legal frameworks.
The definition of a Multimodal Transport Operator under the Act was considered
in Caravel Shipping Services Pvt. Ltd. v. Premier Sea Foods Exim Pvt. Ltd. 25.
The Kerala High Court referred to Section 2(m) of the Act, which defines an MTO
as an entity concluding a multimodal transport contract on its own behalf,
acting as a principal, and being registered under Section 4. The court also
highlighted Section 2(k), defining multimodal transportation as carriage by at
least two different modes under a single contract. This case underscores the
importance of these definitions in determining whether an entity qualifies as an
MTO and whether a particular transport operation falls under the purview of the
Act.
The Madras High Court in M/S EXCEL MARITIME LOGISTICS v. M/S SIVA VENTURES LTD
25 clarified the scope of the Act's applicability. The court held that the Act
did not apply to a case where the transportation was solely by road and within
India, concluding that such a transport was governed by the Carriage by Road
Act, 2007. This ruling emphasizes that the Multimodal Transportation of Goods
Act, 1993, primarily applies to international multimodal transport originating
from India, as per its definition in Section 2(k).
A significant case concerning the applicability of the Act and its limitation
period is M/s. Carborandum Universal Ltd. vs. M/s. M.G. International Transports
GmbH 26. The Madras High Court ruled that the Act was applicable to a transport
involving both road (from Laufenburg, Germany, to Hamburg port) and sea (from
Hamburg to Chennai) under a "Negotiable Fiata Multimodal Transport Bill of
Lading." Consequently, the court applied the nine-month limitation period
stipulated in Section 24 of the Act and found the suit to be time-barred as it
was filed after this period. This case demonstrates the court's interpretation
of "multimodal transport" to include a necessary pre-carriage by road to the
port of loading and the strict enforcement of the Act's limitation period.
Emerging judicial trends indicate a strict interpretation of the definition of
multimodal transportation and the Act's applicability, particularly
distinguishing between international and domestic transport. Courts also
emphasize the importance of the Multimodal Transport Document as evidence of a
multimodal transport contract and strictly enforce the nine-month limitation
period for filing claims under the Act. Furthermore, courts may scrutinize
whether the entity claiming to be an MTO is duly registered under the Act. These
trends highlight the need for parties involved in multimodal transport to ensure
that their operations clearly meet the Act's definition, proper documentation is
in place, claims are filed within the stipulated timeframe, and MTOs are duly
registered.
Potential Conflicts and Overlaps with Other Relevant Indian Laws
The liability regime under the Multimodal Transportation of Goods Act, 1993, may
potentially conflict or overlap with other Indian laws governing the carriage of
goods, particularly the Railways Act, 1989, and the Carriage by Air Act, 1972,
when multimodal transport involves these modes.
When multimodal transport includes a segment by rail, a potential conflict or
overlap exists with the Railways Act, 1989 28. The Railways Act provides a
comprehensive legal framework for the carriage of goods by rail, including
provisions related to the responsibilities and liabilities of the railway
administration as a carrier 29. Notably, the Railway Claims Tribunal Act, 1987,
has an overriding effect on claims against railway administrations for loss,
damage, or non-delivery of goods entrusted to them, and it bars the jurisdiction
of civil courts in such matters 29. This distinct legal regime and the specific
forum for dispute resolution under the Railways Act could potentially conflict
with the general liability provisions and jurisdictional aspects of the
Multimodal Transportation of Goods Act, 1993, when loss or damage occurs during
the rail segment of a multimodal transport.
Similarly, when multimodal transport involves air carriage, potential conflicts
or overlaps may arise with the Carriage by Air Act, 1972 7. This Act
incorporates international conventions such as the Montreal Convention and the
Warsaw Convention, which govern the liability of air carriers for the carriage
of goods in international air transport 29. These conventions establish specific
liability limits for cargo, often expressed in SDRs per kilogram, and outline
conditions under which carriers may be held liable 29.
These specific liability
rules and limitations under the Carriage by Air Act and the incorporated
international conventions could potentially conflict with the general liability
framework and limits provided in the Multimodal Transportation of Goods Act,
1993, when loss or damage occurs during the air segment of a multimodal journey.
Currently, in the absence of specific provisions within the Multimodal
Transportation of Goods Act, 1993, to explicitly address these potential
conflicts with other transport-specific laws, Indian courts may resort to
general principles of legal interpretation and potentially English Common Law to
resolve such issues 28. However, this approach can lead to uncertainty and a
lack of consistent application.
To achieve better legal coherence, potential
solutions could involve amending the Multimodal Act to clearly define its
relationship with other transport laws, perhaps by establishing a hierarchy or
specific rules of precedence in cases of conflict. Harmonizing the liability
provisions across different transport laws in India could also help reduce
potential overlaps and ambiguities. Encouraging parties to clearly define the
applicable liability regime in their multimodal transport contracts, within the
bounds of mandatory legal provisions, could also provide greater clarity.
Consistent and clear judicial pronouncements on how to resolve conflicts between
different transport laws in the context of multimodal transport would also
contribute to a more predictable legal landscape.
Conclusion and Recommendations
The Multimodal Transportation of Goods Act, 1993, represents a significant step
towards regulating liability in multimodal transportation in India by
establishing a framework centered around the Multimodal Transport Operator (MTO)
acting as a principal responsible for the entire door-to-door movement of goods
under a single contract. The Act adopts a modified uniform liability system,
generally holding the MTO liable for loss, damage, or delay based on presumed
fault, but also incorporating elements of network liability by deferring to
unimodal laws when the stage of loss is known and those laws provide different
liability limits. Judicial interpretations have clarified the scope of the Act,
primarily focusing on international transport from India, emphasizing the
importance of the Multimodal Transport Document, and strictly enforcing the
nine-month limitation period for claims.
However, the current legal framework has certain limitations and faces
challenges. The Act's definition of multimodal transport primarily focusing on
international carriage might create a gap for domestic multimodal movements.
Potential conflicts and overlaps with sector-specific laws like the Railways Act
and the Carriage by Air Act remain areas of concern. While the Act aims for
uniformity, the modified approach and the reliance on unimodal laws in certain
situations can introduce complexity and potential inconsistencies.
To enhance the clarity, efficiency, and fairness of the liability regime for
multimodal transportation in India, the following recommendations are proposed:
- Amend the Definition of Multimodal Transportation: Consider amending Section 2(k) of the Act to explicitly include domestic multimodal transportation to ensure comprehensive coverage and avoid ambiguity regarding its applicability.
- Address Conflicts with Unimodal Laws: Introduce specific provisions within the Multimodal Act to address potential conflicts or overlaps with the Railways Act, 1989, and the Carriage by Air Act, 1972. This could involve establishing rules of precedence or harmonizing key liability provisions across these statutes.
- Review and Update Liability Limits: Periodically review and update the SDR-based liability limits specified in Sections 14 and 15 of the Act to ensure they remain adequate in light of inflation and changes in the value of goods.
- Clarify the Application of Section 15: Provide clearer guidelines or examples on how Section 15 (application of unimodal laws when the stage of loss is known) should be applied in practice, particularly in cases involving multiple modes and potentially conflicting liability limits.
- Promote Awareness and Capacity Building: Conduct awareness programs for shippers, MTOs, and legal professionals regarding the provisions of the Act, relevant judicial interpretations, and best practices in documentation and claims handling.
- Consider Ratification of International Conventions: Evaluate the potential benefits of ratifying international conventions like the Rotterdam Rules, which offer a modern and comprehensive framework for maritime and multimodal transport liability. While ratification may take time, aligning domestic laws with such international standards can enhance India's position in global trade.
By implementing these recommendations, India can further strengthen its legal
framework for multimodal transportation, fostering greater confidence among
stakeholders, reducing the potential for disputes, and promoting the efficient
and secure movement of goods, thereby supporting the growth of the Indian
economy and its participation in international trade.
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