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THE LEADING BODY REPRESENTING
THE UK INTERNATIONAL FREIGHT SERVICES INDUSTRY
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The CMR Convention

CMR, officially entitled the Convention on the Contract for the International Carriage of Goods by Road, was devised by the United Nations Economic Commission for Europe (ECE) and agreed on May 19, 1956, becoming operative on July, 1961 and effective in the UK on October 19, 1967 under the Carriage of Goods by Road Act 1965. This Act contains the full text of the convention - an essential source for any exporter or forwarder involved with the international movement of goods by road, obtainable from The Stationery Office. It is also available on line via Google or one of the other search engines.

The convention applies to every contract for the carriage of goods by road in vehicles for reward when the place of taking over the goods and the place of designated delivery are situated in two different countries of which at least one is a contracting party. Thus, any international road journey for hire or reward (own account is not subject to the convention) which either starts or finishes in the UK will be subject to CMR unless one of the following exemptions apply:

  1. Postal despatch;
  2. Funeral consignments;
  3. ''Furniture'' removals (generally accepted to mean household removals);
  4. Movement of own goods;
  5. UK-Channel Islands traffic (the Channel Islands are not separate countries for CMR purposes).

Documentary requirements under CMR
While CMR states that the contract must be confirmed by the making out of a consignment note, the absence or loss of such a document will not prevent the convention provisions from being applied; the goods carried will be subject to the convention in any case. If a CMR Consignment Note is to be completed however required information must still be provided. There is no specific format for the CMR Note and forwarders tend to use an aligned note on sale from various sources, or over-stamp their own documents with a CMR endorsement.

The CMR Note can be completed by the shipper, forwarder or haulier. Where the forwarder enters the information, it is done as agent for the sender, who will be liable for any inaccuracies in the information shown. Three original copies are stipulated in the CMR; the first for the exporter, the second to accompany the goods; and the third for retention by the carrier. Although the CMR Note is not a document of title, it still has great value as evidence and ideally, copies should be retained.

Reservations by the carrier
On taking over goods the carrier should check the accuracy of the statements in the CMR Consignment Note - number of packages, in the consignment and their marks and numbers and the apparent condition of the goods and their packaging. Where the carrier has no reasonable means to check, protection can be afforded by noting reservations on the consignment note. Anything apparently suspect about the goods should be noted. I f the carrier fails to make such reservations it will be presumed, unless the contrary is actually proved, that the number of packages was accurately stated and that the goods appeared to be in good condition.

Liabilities of the road carrier
The carrier is liable for loss, damage or delay to the goods between the time they are taken into its charge until the time they are delivered. The acts of the carrier''s servants agents and sub-contractors also fall within its responsibility subject to a few excepted perils which can provide defence to a claim including wrongful act of neglect of the claimant, Instructions of the claimant given otherwise than as the result of the carrier''s own wrongful act or neglect, Inherent vice of the goods and circumstances which could not be avoided and the consequences of which the carrier was unable to prevent.

Compensation
This is calculated in relation to the value of the goods at the time and place at which they were accepted for carriage, and the value is based either on the commodity or market price, or, where there is no such price, the normal value of similar goods. Most Western European states have ratified a protocol to the CMR introducing compensation limits based on 8.33 SDRs per kilo of gross weight of the goods lost or damaged. An explanation of SDR – Single Drawing Right can be found in the Resources section of the library In addition to compensation for loss or damage, the carriage charges, customs duties and other charges incurred in respect of the transit are refundable in full in the case of a total loss, or pro rata in the case of a partial loss. Where the exporter or importer proves loss suffered through delay, an amount not exceeding the carriage charges may be recovered.

Higher compensation is possible if the exporter makes a declaration of value, which must be shown on the consignment note, but in such cases the carrier is entitled to a higher freight rate. I f the goods are not delivered within 30 days of an agreed time-limit, or in any other case within 60 days, a claimant can treat the goods as lost and claim compensation. Although the time limits set out above apply both to claims made in contract or in tort (the process by which an individual who was not part of the contract but responsible for executing it could potentially be sued), the carrier will lose the benefit of the CMR defences and limits of liability if the loss is caused by wilful misconduct. In one case, an accident caused by a driver who had grossly exceeded EU drivers'' hours rule limits was held to be attributable to wilful misconduct.

Aspects of concern to freight forwarders
Under CMR, a freight forwarder who agrees to move a consignment to the Continent by road as a principal (even if that forwarder does not intend providing the transport directly) is almost certain to be found to be the ''first carrier'' under the CMR Convention, and, therefore, may be sued with full CMR liabilities. It is not clear whether the CMR confers a lien, and if it does it is only a very limited one. It is, therefore, advised by the British International Freight Association, to trade under general conditions which confer a general lien, as is the case, for example, under the current edition of the BIFA Standard Trading Conditions.

If cash on delivery work is accepted under CMR, the carrier is absolutely liable if the money is not paid over and it is therefore strongly advised by BIFA that unless a forwarder can control the whole operation, such obligations should not be accepted. It should be noted that incorporation of the BIFA STC in addition to CMR will offer the forwarder protection.

It is extremely important that any obligations which the forwarder has accepted, such as an increase in the limit of liability, should be recorded on a CMR Note, otherwise they will not bind any successive carrier although they might be enforceable against the forwarder.



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