Special provisions for the international sea transport from and to China

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The main transport mode for cargo to and from China still is carriage by sea. The largest Chinese container ports include in descending order Shanghai, Hong Kong, Shenzhen, Ningbo, Qingdao, Guangzhou and Tianjin.

 

 

Despite its importance, China has not ratified any of the international conventions in this field.
 

Nevertheless, the Maritime Code of the People’s Republic of China largely complies with international agreements such as the Hague-Visby Rules, although formulations of the Hamburg Rules have also been adopted. The liability system contained in the Maritime Code applies to international carriage of goods by sea, but not if transport occurs between ports located in the People's Republic of China. 

 

Key provisions of the Maritime Code of the PR China

Some of the key provisions can be summarized as follows:

 

Packaging

  • Consignor has to properly pack goods and has to guarantee the accuracy of the description, mark, number of packages or pieces, weight or quantity of the goods at the time of shipment
  • Carrier has to exercise due diligence to make ship seaworthy, properly man, equip and supply the ship and to make the holds, refrigerating and cool chambers and all other parts of the ship in which goods are carried, fit and safe for their reception, carriage and preservation before and at the beginning of the voyage.

Liability

  • Carrier has to properly and carefully load, handle, stow, carry, keep, care for and discharge goods carried.
  • Carrier is responsible while in charge of goods and for loss of or damage to them, except as otherwise provided for.
  • Carrier is not prevented from entering into agreement concerning its responsibilities with regard to non-containerized goods prior to loading onto and after discharging from ship.
  • Carrier is liable for loss of or damage to goods caused by delay in delivery due to the fault of the carrier, except those arising or resulting from causes for which the carrier is not liable as provided for in rules. (Delay occurs when goods have not been delivered at the designated port of discharge within the time expressly agreed upon.)
  • Carrier is liable for economic losses caused by delay due to fault of carrier, even if no loss of or damage to goods had actually occurred, unless such economic losses had occurred from causes for which carrier is not liable as provided for in rules.

Defenses

  • Carrier is not liable for loss of or damage arising or resulting from any of the following causes:
  1. Fault of master, crew members, pilot or servant of carrier in navigation or management of ship;
  2. Fire, unless caused by the actual fault of carrier;
  3. Force majeure and perils, dangers and accidents of the sea or other navigable waters;
  4. War or armed conflict;
  5. Act of the government or competent authorities, quarantine restrictions or seizure under legal process;
  6. Strikes, stoppages or restraint of labor;
  7. Saving or attempting to save life or property at sea;
  8. Act of the shipper, owner of the goods or their agents; 
  9. Nature or inherent vice of the goods;
  10. Inadequacy of packing or insufficiency or illegibility of marks; 
  11. Latent defect of the ship not discoverable by due diligence; and 
  12. Any other cause arising without fault of carrier or his servant or agent.
  • Unless written notice of loss or damage is given by consignee to carrier at time of delivery of goods by carrier to consignee, such delivery is deemed to be prima facie evidence of delivery of the goods by carrier as described in the transport documents and of the apparent good order and condition of such goods.

Limitation

  • Indemnity for loss of goods is calculated on basis of actual value of goods lost. For damage to goods indemnity is calculated on basis of difference between values of goods before and after damage, or on basis of expenses for repair, less of expenses that had been reduced or avoided as result of loss or damage at the time of compensation. (actual value is value of goods at time of shipment plus insurance and freight) 
  • Carrier's liability for loss of or damage is limited to 666.67 SDR per package or 2 SDR per kg of gross weight of goods, whichever is higher.
  • Higher value declaration by shipper to carrier against fee is possible.
  • Where a container, pallet or similar article of transport is used to consolidate goods, number of packages or other shipping units in bill of lading as packed in such article of transport is deemed to be number of packages or shipping units. If not so enumerated, goods in such article of transport are deemed to be one package or one shipping unit.
  • Where article of transport is not owned or furnished by carrier, such article of transport is deemed to be one package or one shipping unit.
  • Liability of carrier for economic loss resulting from delay is limited to an amount equivalent to freight payable for goods delayed.
  • Carrier is not entitled to benefit from limitation, if it is proved that loss, damage or delay resulted from an act or omission of the carrier done with intent to cause such loss, damage or delay or recklessly and with knowledge that such loss, damage or delay would probably result.

Time

  • Time limitation for claims is one year, counting from day on which goods were delivered or should have been delivered by carrier.

  

In addition to these rules and as far as permitted, the terms and conditions contained on the reverse side of bills of lading should also be regarded. Particularly the COSCO Container Lines Bills of Lading are of practical relevance when trading with China.
 

Furthermore, the Chinese Contract Law applies to all modes of transports in China.
 

For more information, please see our article about the applicable transport liability regimes for shipping goods from and to China.
 

Further special regulations also apply in air transport, rail transport and in the case of multimodal transport.

 

  updated 19 June 2017

 

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