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Modernizing Pakistan’s Carriage of Goods
Legislation

Zahid Jamil & Shahid Jamil

Barristers-at-Law
 
Efficient trade and transport facilitation as one of the controversial Singapore issues of the WTO can only be accomplished with modern and enabling legislation being put into place. As such, UNCTAD and NTTFC’s Trade and Transport Facilitation Project has drafted certain proposed drafts of laws governing the carriage of goods that will modernize and update the legal concepts supporting and protecting the parties to a contract of carriage.

This effort has lead to various legislations being drafted so far, notably governing the carriage of goods by Air, Sea and Road that updates the law surrounding carriage by these three methods both within and outside Pakistan. One of the most notable and common aspect of these draft legislations has been its enabling of electronic documentation to be effected evidencing the contract of carriage that complement and rely on the Pakistan Electronic Transactions Ordinance 2002. These provisions represent an invaluable part of trade and transport facilitation that will allow Pakistan’s trade and logistics to be upgraded to and be in harmony with international best practices and standards.

As a short précis of the advantages of each of these legislations the following summaries are provided:

Carriage by Air
International carriage by air in Pakistan is currently governed by the Carriage by Air (International Convention) Act of 1966 and the Carriage by Air (Supplementary Convention) Act of 1968 which implement the Warsaw Convention as amended at the Hague 1955 and the Guadalajara Convention respectively. As such, Pakistan’s legislation applying to international carriage by air is the most up to date of all of Pakistan’s trade and transport legislations.

The Pakistani government has recently signed the latest International Convention governing Air law, namely the Montreal Convention 1999. As such, the TTF project has succeeded in drafting implementing legislation for the said Convention. The benefits of the draft law drafted by the TTF project are that it allows for much more modern provisions and legal concepts. This can be seen in the fact that it allows for electronic tickets and air-way bills to be issued in air carriage. In addition, the draft law in this area is more specific and addresses the different types carriage of baggage (both checked and unchecked), passengers, and cargo by creating different and more specific provisions that balance the interests of all the stakeholders in a much more efficient manner. Finally, the draft law also attempts to get over any overly burdensome technical formalities that carriers may have to undertake, thus making the process more efficient for the carrier.

In terms of the domestic carriage by air, the current shape of Pakistani legislation is opaque, confused and complex. This confusion is caused by the fact that the current law in this area is an amended version of the Carriage by Air Act 1934. The 1934 Act (which implemented the original Warsaw Convention 1929) applied to international carriage by air prior to 1966. Under the provisions of the 1934 Act, the Federal Government made modifications to it through SRO 295 (K) 62 and SRO 1033(K) 67 and applied the modified 1934 Act to domestic carriage by air. Therefore, the current legislation on domestic carriage by air is embodied in two SRO notifications that are not very accessible to the general public and create confusion throughout this area of the law.

To address this problem, the draft law that has been prepared has upgraded the law applicable to domestic carriage by air by including provisions that govern both the international carriage by air as well domestic carriage by air. This will allow the general public to have greater access to the law that is applicable to their contracts of carriage by air as well as bring the domestic legislation in line with international best practices and make it more efficient and streamlined.

In short, the draft legislation introduces more modern concepts into carriage by air legislation making it more efficient, streamlined and up to date. It removes the problems of the previous legislation making it more transparent and holistic in its approach.

Carriage by Sea
The carriage of goods by sea in Pakistan is currently governed by the Carriage of Goods by Sea Act (COGSA) 1925 (which implements the Hague Rules 1924) and the Bills of Lading Act 1855. These laws are old and anachronistic in that the legal concepts embodied in them have now become out of date with commercial realities and many specific problems are not addressed adequately by these laws.

The draft law upgrades the law surrounding the carriage of goods by sea and is modelled on the UK COGSA 1971. It therefore brings in the legal concepts and provisions contained in the Hague-Visby Rules, thus giving more modern substance to Pakistani legislation governing sea carriage.

The draft law becomes more in touch with commercial realities by extending the scope of its application to more documents than before. The old law only envisaged the use of the bill of lading by carriers to evidence a contract of carriage. However, as commercial realities have overtaken legislation, carriers have started to use more varieties of documentation to evidence a contract of carriage including sea waybills and ship’s delivery orders. In addition, some of these documents need to be used in their electronic formats as well. The draft law gives legal coverage to these major documents used by carriers worldwide and allows them to be issued electronically as well.

In addition, the draft law also brings in the use of SDR’s in calculating the limits of liability of carriers, thus making it more in line with international best practices and standards.

The draft law also covers certain peculiar lacunaes in the law that were specific to the Pakistani legal landscape and extends protection to all the stakeholders involved in a more balanced and economically efficient manner.

Thus, the draft law is not only in conformity with international best practices, but is also an indigenous draft taking care of specific local Pakistani problems. As such, the draft is a workable and modern piece of legislation that will allow greater comfort and protection to all the stakeholders involved and balances their interests in an efficient and more certain manner.

Carriage by Road
The carriage of goods by road within Pakistan is currently governed by the Carrier’s Act 1865, which is a law that is badly in need of reform. The limitations of liability enshrined in that Act have remained fixed at Rs.100 per item for well over a century. In addition, the Act does not adequately cover the needs of the road transport carrier since it does not lay down any laws that would be favourable to the carrier.

The draft law in this area looks to upgrade the law by, for the first time in Pakistan, introducing legislation that is specific to the needs of road carriers and affords them adequate protection in terms of definite limits on their liability that is more in tune with the prevalent commercial practices. In addition, the issuance of electronic documentation is enabled by the draft law which also seeks to establish workable defences for the carrier that protects the carrier in various situations. The draft law has been modelled on the CMR Convention 1956 which is an internationally recognised road carriage convention of standard. Thus, adopting its basic principles will help to upgrade the law and regulate the contracts of carriage by road in an efficient and enabling fashion.

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