Hard Brexit: Liability Risk for Carriers

Recommendation

4/5 February 2020
Prague, Czech Republic

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Despite current progress, there is still a risk that the United Kingdom (UK) will leave the European Union (EU) without an agreement; a so-called "Hard Brexit". Carriers should be prepared. There is an interesting article on this subject from the law firm Arnecke Sibeth Dabelstein.

In the case of a "Hard Brexit", the duty-free trade status of the United Kingdom with the EU Member States would be lifted. As a result, customs declarations would be required for imports and exports and duties will be collected.

In any event, import and export delays are to be expected, which may also have an impact on supply and freight contracts.

The law firm points out that "EU carriers are liable under Article 17(1) of the Convention on the Contract for the International Carriage of Goods by Road (CMR) for damages caused by delay in delivery". With regard to the delays to be feared, "it would be difficult for them to rely on the liability exemption under Article 17(2) of the CMR, which holds that a carrier's circumstances were unavoidable and unpreventable ".

In its commentary, the law firm does not exclude the possibility that a Brexit without an agreement "would increase liability risks for EU carriers and freight forwarders". Before carrying out cross-border transports, they recommend "to make clear agreements with senders in order to clarify that import and export customs clearance delays are expected for an unforeseeable duration. Further, carriers should request instructions from senders in accordance with Article 14 of the CMR to reduce their liability risk."