After two decades of consistent recommendations by Transport Canada, it appears that the Canadian Parliament has finally given up hope of implementing the Hamburg Rules as a new liability regime for the carriage of goods by water. Among the several amendments made by the omnibus Budget Implementation Act, 2023, No. 1 (S.C. 2023, c. 26) to the Marine Liability Act (S.C. 2001, c. 6) (the "MLA"), all mention of the Hamburg Rules has been removed from the MLA, effective as of June 22, 2023.
The Hamburg Rules, officially known as The United Nations Convention on the Carriage of Goods by Sea, 1978, were drafted by UNCITRAL in 1976 as a proposed replacement for the Hague Rules of 1924 and the Hague-Visby Rules of 1968. While Canada has not ratified any of these instruments, it has incorporated the Hague-Visby rules into its domestic law with certain changes, through the MLA.
The coming-into-force provision for the Hamburg Rules, s. 45 MLA, was repealed on January 1, 2021 by an amendment implementing s. 3 of the Statutes Repeal Act (S.C. 2008, c. 20), as the provision had not come into force for over 10 years. Pursuant to the reporting requirement in s. 44 MLA, Transport Canada ("TC") had been reporting to Parliament every 5 years on the possibility of applying the Hamburg Rules and having s. 45 MLA come into force.
However, each TC report had recommended not to take any action to apply the Hamburg Rules, due to insufficient international adoption. The last TC report had been delivered in 2019, and it had followed all preceding reports in recommending that the Hamburg Rules not be adopted. This report had concluded that "despite its shortcomings, the Hague-Visby Rules continue to be the marine cargo liability regime that is best able to support Canada's objective of maintaining uniformity with our major trading partners".1
The Hamburg Rules are widely considered to be shipper friendly, at the expense of carriers.2 In particular, contrary to the previous Hague and Hague-Visby regimes, they provide for (i) joint and several liability between contracting and performing carriers, (ii) the abolishment of carriers' defense of error in navigation or management of the ship, (iii) the extension of the Rules to all contracts of carriage except charterparties (and not only contracts of carriage evidenced by bills of lading), and (iv) the extension of the Rules to deck cargo, live animals, and non-commercial cargoes. While Canada, as a "consumer nation" with a relatively smaller marine shipping industry, had considered the adoption of the Hamburg Rules, the limited international adoption of this regime proved prohibitive.
The Hamburg Rules are now adrift. Where does this leave us? It seems that the new-generation Rotterdam Rules, codified in The United Nations Convention on Contracts for the International Carriage of Goods Wholly or Partly by Sea, 2008, may face similar issues to the ill-fated Hamburg Rules. The Rotterdam Rules have been adopted by a limited number of states. They are even more ambitious in scope, covering international multimodal carriage where part of the carriage occurs by water.
The vital efforts to promote uniformity of the law of marine cargo carriage, spearheaded by international organizations such as the Comité Maritime International and UNCITRAL, are clearly braving rough seas. Time will tell where they come ashore.
This article is also available in the October 2023 edition of Legal Industry Reviews, available here: The Legal Industry Reviews, Canada Vol. 3, October 2023 by Industria Legal - Flipsnack
Footnotes
1. Transport Canada, "Report to Parliament, Marine Liability Act, Part 5: Liability for the carriage of goods by water", 2019: Read more HERE.
2. See e.g. Francesco Berlingieri, "A Comparative Analysis of the Hague-Visby Rules, the Hamburg Rules, and the Rotterdam Rules", Paper delivered at the General Assembly of the AMD, Marrakesh, November 5-6, 2009; see also Lord Diplock, "Introduction", in Comité Maritime International, Colloquium on the Hamburg Rules, Vienna, January 8-10, 1979.
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