NITL Backs New Maritime Liability Rules

The nation’s largest shipper organization is backing a new standard for cargo liability in international transport that would supersede current U.S. maritime cargo liability law.

The new convention, informally known as “the Rotterdam Rules,” would bring uniformity and consistency to the application of awards for lost or damaged cargoes, said the National Industrial Transportation League.

The NITL’s board of directors voted unanimously to support the rules May 5. Several international organizations have worked on the new rules, which must be approved by Congress before they can be adopted in the United States.

“The development of compatible worldwide standards applicable to the loss and damage of maritime cargoes is long overdue,” said Mark Maleski, NITL chairman and supply chain logistics director for retailer J. C. Penney.

Uniformity and consistency are notably lacking in the liability rules governing maritime shipping today, said Peter Gatti, executive vice president of the NITL, which represents some 700 U.S. companies involved in domestic and international transport.

Also, the current U.S. law, the Carriage of Goods at Sea Act, hark back to a time when cargo was shipped in boxes, crates and bags, rather than on pallets or in containers.

COGSA is the U.S. law enacting the “Hague Rules,” an international convention dating to 1924. “We all know the world has changed significantly since that time,” Gatti said.

“The Rotterdam Rules will reflect current shipping practices, contain significant improvements over existing cargo liability conventions, promote harmonization among trading partners, reduce legal obstacles and will allow shippers, carriers and third parties to customize their contracts to meet their commercial needs,” he said.

Unless the U.S. adopts the rules, U.S. interests will be subject to inconsistent rulings, unpredictable results and operate at a competitive disadvantage to overseas companies, the NITL warned.