CHAPTER 6 :ROTTERDAM RULE

TUTORIAL QUESTIONS & ANSWERS

1. Discuss the main provisions contained under the United Nations Convention on Contracts for
the International Carriage of Goods Wholly or Partly by Sea (“The Rotterdam Rules”).

a. No contracting out
According to Article 79, any term in a contract of carriage is void to the extent that it
conflicts with the Rotterdam Rules.
The parties cannot contract out of the Rules, either in favour of the shipper, or in favour of the
carrier.
b. Who is a carrier?

A carrier is defined simply as ‘a person who enters into a contract of carriage with a shipper’;
and a shipper is ‘a person who enters into a contract of carriage with a carrier’(Art 1(5) and
(8)).

When the contract of carriage does not name a carrier, there is a presumption that the
registered owner is the carrier and, if he is sued within the time bar, the claimant may
thereafter modify the lawsuit by adding further parties.

Given that this is an exception to the time bar of two years, registered owners of ships would
be wise to encourage their bareboat charterers systematically to name themselves (or some
other party) as carriers in the contract of carriage.

c. Liabilities for other performing parties

The carrier’s liability extends to breaches of its obligations under the Rotterdam Rules (further
below) caused by the acts or omissions of performing parties, master and crew, employees
and employees of a performing party as well as ‘any other person that performs or undertakes
to perform any of the carrier’s obligations under the contract of carriage, to the extent that the
person acts, either directly or indirectly, at the carrier’s request or under the carrier’s
supervision or control’(Art 18(d)).

d. Duty to issue a transport document

There is a general duty on the carrier to issue a transport document (Art 35). However, there is
no duty to issue a transport document where the parties have agreed not to use a transport
document or it is the practice of the trade not to use one. The Rotterdam Rules are generally
rather formalistic in relation to documents.

Article 3 provides that notices, confirmation, consent, agreement, declarations and other
communications under the convention must be in writing (including electronic writing). Other
articles list the precise contents of a particular document. For instance, Article 36 provides a
detailed list of information that the transport document must contain.
 e. Duty in regards to goods carried

The starting point is that the carrier is liable for any loss, damage or delay arising during the
period of its responsibility (Art 17(1)).The period of responsibility is defined as from receipt to
delivery (Art 13).
Once the claimant has proven that the loss, damage or delay occurred during that period, the
carrier may avoid liability either by proving that the cause of the loss, damage or delay was not
attributable to its fault (Art 17(2)), or by proving that the cause of the loss was one of those
listed in Article 17(3).

2. On 1 November 2018, Boris contracted with Xi, a shipowner, to transport Boris’s cargo of
peanuts from USA to Spain. They entered into contract for a voyage charterparty to use a
substantial portion of the vessel. The shipment was set on 1 January 2019.2020 On 25
December 2019, most of Boris’s workers went for a Christmas holiday, which resulted in a
delay in packing the peanuts for shipment. The peanuts were then contaminated with beetles
in their haste of packing.
On 3 January 2019, the goods were finally ready for shipment and the ship sailed on the same
day. During the voyage, one of the pipes in the ship leaked and the fluids destroyed the
packing of some of the peanuts packs. Some beetles break free from the packaging and
infested a cargo of cotton that belonged to another shipper. To reduce
further damage, the ship crews decided to throw all the peanuts overboard. The crews were
also ordered to fumigate the ship which made it unusable for three months. On 5 January
2019, Boris was informed of the incident on board and decided to file a legal action against Xi.
Xi, on the other hand, alleged that Boris’s negligence has resulted in the loss of both himself
and the cotton shipper.

i. Advise the parties in accordance with the Rotterdam Rules.

ii. They entered into contract for a voyage charterparty to use a substantial portion of the
vessel.

Suggested Answer

Duty in regards to goods carried

1. Art 17(1) refers “Basis of liability”

Carrier’s Liability
 Here the carrier is liable for any loss, damage or delay arising during the period of its
responsibility
Responsibility of the carrier (Art 12)
 The carrier shall during the period of its responsibility as defined in article
 12,, properly and carefully receive, load, handle, stow, carry, keep, care for, unload
and deliver the goods.
Period of Responsibility
 The period of responsibility of the carrier for the goods under this Convention begins
when the carrier or a performing party receives the goods for carriage and ends when the
goods are delivered (Art 13 ).
2. Claimant proves Liability
 The claimant has to prove loss of the goods, damages of his goods or delay in delivering
his goods.
 Once the claimant has proven that the loss, damage or delay occurred during that
period of responsibility , the carrier may avoid liability either by proving that the cause
of the loss, damage or delay was not attributable to its fault (Art 17(2)), or
 by proving that the cause of the loss was one of those listed in Article 17(3) as stated
below:
o (a) Act of God;
o (b) Perils, dangers, and accidents of the sea or other navigable waters;
o (c) War, hostilities, armed conflict, piracy, terrorism, riots, and civil
commotions;
o (d) Quarantine restrictions; interference by or impediments created by
governments, public authorities, rulers, or people including detention, arrest, or
seizure not attributable to the carrier or any person referred to in article 18;
o (e) Strikes, lockouts, stoppages, or restraints of labour;
o (f) Fire on the ship; (g) Latent defects not discoverable by due diligence;
o Act or omission of the shipper, the documentary shipper, the controlling party, or
any other person for whose acts the shipper or the documentary shipper is liable
pursuant to article 33 or 34;
o Wastage in bulk or weight or any other loss or damage arising from inherent
defect, quality, or vice of the goods;
o Insufficiency or defective condition of packing or marking not performed by or
on behalf of the carrier;
o Reasonable measures to save or attempt to save property at sea;

3. Liability of Carrier Art 17(4)

The carrier is liable for all or part of the loss, damage, or delay:
If the carrier succeeds in proving that one of those listed events was the cause of the loss, the
ball is once again in the claimant’s court. The claimant then has three options:
• it may prove (Art 17(4)) that the carrier was at fault in relation to the exclusion that it has
proven under Article 17(3); or
• it may prove that there is another contributing cause not listed in Article 17(3) and, if so, it
is once again the carrier’s turn to prove that it was not at fault in relation to that
contributing cause; or
• the claimant may prove that the loss, damage or delay was due to unseaworthiness (Art
17(5)). If the claimant succeeds in proving a lack of seaworthiness, the carrier’s last option is
to prove that the lack of seaworthiness did not cause the loss, or else that it exercised due
diligence.

Duties of the shipper

 The duties and liabilities of the shipper are gathered in Chapter 7 of the Rotterdam Rules.
 The duties of the shipper apply, apart from to the person who enters into the contract of
carriage with the carrier, also to a character called the ‘documentary shipper’, defined as‘a
 person, other than the shipper,that accepts to be named as shipper in the transport
document’(Art 1(9)).

•The duties, liabilities and defences of the documentary shipper are those of the shipper (Art
33).

 The shipper is also liable for losses arising from the actions of employees,subcontractors and
others(Art 34).
 Duty for the Shipper in respect of cargo
•The duties of the shipper in relation to the cargo are
o to deliver the cargo ready for carriage and
o to perform any FIOS duties it may have undertaken to perform (Art 27).
o the shipper shall deliver the goods-
o in such condition that they will withstand the intended carriage, including their
loading, handling, stowing, lashing and securing, and unloading, and that they
will not cause harm to persons or property.
•In relation to dangerous cargo, including legally dangerous cargo,the
shipper must notify the carrier of its dangerous nature and furnish it with appropriate marks.
•If the shipper fails to do so,the liability is strict. The duties under Article 27 give rise only to
fault-based liability

Duty to provide information

 The shipper is under several different information duties under Articles 28, 29 and 31.
 The duty under Article 28 is to exchange information and instructions with the carrier (a
bilateral duty),
 Article 29 imposes a duty on the shipper to provide information, instructions and
documents to the carrier.

These duties give rise to a fault-based liability according to Article 30. By contrast,the shipper is also
under a strict duty to provide information in relation to contract particulars (Art 31).

This duty is a weighty one: not only is liability strict, but by providing the information,the shipper
guarantees its accuracy.The carrier is thus entitled to rely on the information provided by the
shipper. The shipper shall provide to the carrier, in a timely manner, accurate information required
for the compilation of the contract particulars and the issuance of the transport documents or
electronic transport records.

ii. They entered into contract for a voyage charterparty to use a substantial portion of the
vessel.

o Article 6(1) –

This Convention does not apply to the following contracts in liner transportation:
(a) Charter parties; and
(b) Other contracts for the use of a ship or of any space thereon.
 Therefore contract entered for a charter party voyage does not fall within the
Convention.

3.. Analyse whether Malaysia has been a party to any of the rules in regards to carriage of goods
by sea.

o The Carriage of Goods by Sea (Amendment) Act 2019 came into force in 2020.
o The amending act does not set out the provisions of the Hague-Visby Rules into the Act
o but states that the Minister is entitled to amend the Schedule to the Act by order published
in the Gazette (the Schedule presently sets out the provisions of the Hague-Visby Rules).
o Rules will become part of Malaysian law after the Act comes into force and the Minister
issues an order.
o The process of Hague Visby Rules will continue to dominate international carriage.

4. Albert , an Australian citizen, has entered into a CIF contract with Hassan from Kuala Lumpur
Malaysia. to sell leather goods to Hassan. Albert has engaged an Australian carrier MV Sydney
Express to deliver the consignment to Malaysia.It was agreed that the goods would be delivered
to the carrier on the 10.7 2022 . but till to date the carrier has not complied with the
requirements of Article 35. Advise Hasan.

Suggested Answer
i. The contracts of carriage between Albert and Hassa must fall within the requirement of
Article 5 which requires the:
o place of receipt and the place of delivery are in different States, and
o the port of loading of a sea carriage and the port of discharge of the same sea
carriage are in different States, then, according to the contract of carriage, any
one of the following
 places is located in a Contracting State the Rotterdam Rule shall apply.
ii. There is a general duty imposed on the carrier to issue a transport document as required
under Art 35).
iii. However, where the parties have agreed not to use a transport document or it is the
practice of the trade not to use one then there is no duty on the carrier to issue a
transport document.
iv. The Rotterdam Rules are generally rather formalistic in relation to documents.
v. Article 3 provides and requires that all notices, confirmation, consent, agreement,
declarations and other communications under the convention must be in writing
(including electronic writing).
vi. Other articles list the precise contents of a particular document. For instance, Article 36
provides a detailed list of information that the transport document must contain.
vii. Article 38 requires :

1. A transport document shall be signed by the carrier or a person acting on

its behalf.
2. An electronic transport record shall include the electronic signature of the
carrier or a person acting on its behalf.
Conclusion
Whether the Rotterdam Rule applies

 The requirement in (i) above has been satisfied where Sydney and KL are place of
receipt and the place of delivery which are in different States.
 Second the port of loading of a sea carriage and the port of discharge of the same sea
carriage are in different States . The requirement of Art 5 is satisfied.
 MV Sydney Express is the carrier who has entered into a contract of carriage with Albert
who is the shipper. (Art 1(5) & (8).
 The general duty on the carrier is to issue the transport document as required under Article 35
to Hassan.
 Hassas has yet to obtain any transport document from the carrier.
 Liability
o The carrier may, lose the right to limit liability, both for loss and for loss due to
delay.

5. Relying on the scenario in Question 4 , explain to Hassan the circumstances in which the
Rotterdam Rule is not applicable.

Suggested Answer
 Contracts of Carriage by air, road, rail or inland waterways (Art 82)
• Rotterdam Rules will not apply before loading and after discharge where there is another
international convention that applies to those phases of the carriage (Art 26)
• The Rotterdam Rules do not apply to charterparties or to slot charters in liner
transportation (Art 6(1))
• Contracts for the carriage of passengers and their luggage (Art 85)
• Tonnage limitation (Art 83).

6. Explain the duties of the shipper in relation to the cargo.

Suggested Answer
•The duties of the shipper in relation to the cargo are to deliver the cargo ready for carriage
and to perform any FIOS duties it may have undertaken to perform (Art 27).
•In relation to dangerous cargo, including legally dangerous cargo,the
shipper must notify the carrier of its dangerous nature and furnish it with appropriate marks.
•If the shipper fails to do so,the liability is strict. The duties under Article 27 give rise only to
fault-based liability.
7. Explain the Rights and obligations of the carrier under the RR.
Suggested Answer
 According to Article 12 the duty of the carrier is to take the goods to destination.
 Under Article 13 the obligation entails the duties to “ receive, load, handle, stow, carry,
keep, care for, unload and deliver the goods’’.
 The obligation for providing a seaworthy vessel is for the entire duration of the voyage
(i.e. continuous as under English Common Law) rather than interrupted as in the case of
HVR.
 The ‘’nautical fault’’ does not exist under the RR.
 Time bar is as per HR, i.e. two years.
 Delays in transit times can lead to claims under the RR.
 In general the obligations of the carrier are more extensive and cover door to door
delivery. To this end there is a new duty to receive and deliver the goods .
 Generally the carrier is responsible/liable in case of damage occurred whilst the goods
are in his own period of responsibility, unless he can prove that damage was not due to
his own fault, or under certain circumstances.
 The periods of responsibility under the different Rules are as follows:
o HVR: Loading – discharging
o HR : Port of loading – Port of discharge
o RR : Receipt – Delivery of the goods ( considerably wider

8. Hassan intends to enter into a contract with Albert. However, before he enters into a
contract , he wishes to know from you who is a carrier?

Suggested Answer

 •A carrier is defined simply as ‘a person who enters into a contract of carriage with a
shipper’; ’(Art 1(5)

 a shipper is ‘a person who enters into a contract of carriage with a carrier’(Art 1 (8)).

 •When the contract of carriage does not name a carrier, there is a presumption that the
registered owner is the carrier and, if he is sued within the time bar, the claimant may
thereafter modify the lawsuit by adding further parties.

•Given that this is an exception to the time bar of two years, registered owners of ships would
be wise to encourage their bareboat charterers systematically to name themselves (or some
other party) as carriers in the contract of carriage
9. Explain the Rights and obligations of the shipper under the RR.
Suggested Answer
i. Duties: To deliver the goods in good condition and provide the requisite information
concerning the goods and the draft BoL.
ii. Rights: To obtain a BoL once the goods have been delivered to the carrier.
iii. The shipper does not have the right to limit his liability but there is a question mark
regarding the substance of such a liability when – according to the Contract of Carriage –
the responsibility for the goods rests with the carrier.
iv. Freight Forwarders: Are accommodated under the RR either as ‘’carriers’’ or as
‘’documentary shippers’’.
v. Liability limits : are higher than both HVR and HR at SDR 875 per parcel. One party only is
entitled to give instructions to the carrier.
vi. Ship arrest: The ability of the shipper to arrest the ship of the carrier has been enhanced.

END