THE NEW LIABILITY LIMITS OF THE MONTREAL CONVENTION 1999 TAKE EFFECT ON 28 DECEMBER 2019

The main criticism of the Warsaw Convention System (WCS) after the Second World War was the low liability limits in personal injury claims. An increase of the limits required an amendment of the WCS via diplomatic procedures which took considerable time as States had different views on how much a human life was worth. The outdated limits eventually led to the implementation of the Montreal Convention 1999 (MC) which has not replaced the WCS yet, but is applicable to most parts of the world (136 State Parties as of 28 December 2019).

To avoid a similar fate, Art 24MC provides that its limits of liability will be reviewed by the International Civil Aviation Organisation (ICAO) at 5-year intervals (“escalator clause”). They will be increased, if the inflation factor measured by the weighted average of the annual rates of increase or decrease in the Consumer Price Indices of the States whose currencies comprise the SDR (USA, Japan, EU, China and the UK), exceeds 10% since the previous revision. The increase becomes effective six months after ICAO notifies all State Parties of its intention, unless most of the States Parties disapprove it within three months of the notification. No such disapproval has ever occurred. There is also an extraordinary procedure that permits the revision to take place at any time provided that the inflation rate exceeds 30% since the previous revision and one-third of the State Parties express such desire. This procedure has not been used yet.

Since the MC came into force on 4 November 2003, ICAO has reviewed the limits in 2009, 2014 and 2019. The first review led to their increase since 30 December 2009, yet the second one did not trigger an increase as the inflation rate was below the 10% threshold.

The third review took place this year (2019) with ICAO willing to increase the limits as the inflation rate amounted to 13.9%. No disapprovals were registered within the 6-month period and the following new limits will take effect on 28 December 2019 (the table is provided by ICAO @  https://www.icao.int/secretariat/legal/Pages/2019_Revised_Limits_of_Liability_Under_the_Montreal_Convention_1999.aspx) :

 

Montreal

Convention

of 1999

Original limit (SDRs) Revised limit (SDRs)

as of 30 December 2009

Revised limit (SDRs)

as of 28 December 2019

       
Article 21

passenger claims for bodily injury or death

 100 000 113 100 128 821        
Article 22, paragraph 1

claims for delay

4 150 4 694 5 346        
Article 22, paragraph 2

claims for LDD of baggage

1 000 1 131 1 288        
Article 22, paragraph 3

claims for LDD of cargo

17 19 22        

 

Existing claims will not be affected by the 2019 limits but will be governed by the 2009 ones. The new limits will apply to incidents that take place on or after the 28th December 2019. The International Air Transport Association (IATA) has already amended Resolution 600B, which contains the standard air waybill conditions of contract, to apply the new limit of 22 SDRs per kg to all international carriage of goods (condition 4).  

Published by

Dr George Leloudas

Dr Leloudas joined the School of Law in 2011. He is a graduate of the National and Kapodistrian University of Athens. He holds LLM degrees in Commercial Law from the University of Bristol (England, 2002) and in Air and Space Law from the Institute of Air and Space Law of McGill University (Montreal, Canada, 2003). He also completed his PhD degree in air law with emphasis on liability and insurance at Trinity Hall, Cambridge University in 2009. Before joining the School Dr Leloudas worked as a Solicitor in a leading aviation law firm in London for several years where he advised on aerospace liability and airlines’ regulatory matters. He was also an assistant to the legal counsel of the International Union of Aviation Insurers (IUAI) providing support in relation to the replacement of the Rome Convention on Surface Damage. Dr. Leloudas is an instructor at the Training and Development Institute of the International Air Transport Association (IATA) where he teaches international air law for lawyers and legal professionals and law of aviation insurance. I joined the Institute of International Shipping and Trade Law (IISTL) in 2011 as a lecturer and I was promoted to Associate Professor in 2015. I am a graduate of the National and Kapodistrian University of Athens. I also hold LLM degrees in Commercial Law from the University of Bristol (England, 2002) and in Air and Space Law from the Institute of Air and Space Law of McGill University (Montreal, Canada, 2003). I completed my PhD degree in air law with emphasis on liability and insurance at Trinity Hall, Cambridge University in 2009. Before joining the Institute, I worked as a Solicitor at Gates and Partners in London for several years where I advised on aerospace liability and airlines’ regulatory matters. I was also an assistant to the legal counsel of the International Union of Aviation Insurers (IUAI) providing support in relation to the replacement of the Rome Convention on Surface Damage. I am an instructor at the Training and Development Institute of the International Air Transport Association (IATA) where I teach international air law for lawyers and legal professionals, law of aviation insurance and air cargo liability. I am also a contributing writer to Shawcross and Beaumont on Air Law. My principal research interest is the carriage of passengers and goods by air, but my interests extend to multimodal transport, insurance law and tort law. I am an active researcher and my doctoral thesis, "Risk and Liability in Air Law" was published by Informa in September 2009. My most recent article is entitled ʻ“Door to door” application of the international air law conventions: commercially convenient, but judicially dubiousʼ and has been accepted for publication in the August 2015 issue of Lloyd’s Maritime and Commercial Law Quarterly (August 2015 issue). I am also authoring a book together with Professor Malcolm Clarke of Cambridge University on Air Cargo Insurance (Informa law from Routledge, 2016).

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