Civil liability of rail carriers under CIM and SMGS international conventions: a comparative analysis

Establishment and development of an appropriate cargo carriage system is a precondition for the economic progress of any country. Cargo carriage is of particular importance for the development of international trade, therefore, aiming for effective and uniform international carriage of cargoes, uniform international regulations have been developed and improved for more than fifty years. Based on these regulations, individual legal provisions were developed and applied, both regionally and globally, to all transport modes except for carriage by rail, the regulation of which has always been developing on its own (i.e. individually for this mode of transport). The past decades saw a significant expansion of foreign trade, in particular that between Europe and Asia. For example, container carriage by sea has reached record volumes of 10 million TEU per year. A report on the study conducted by the United Nations Economic Commission for Europe (UNECE) in 2010 suggests that this trend will last until seaports in both continents become overloaded and their capacities no longer meet business needs. Therefore, significant infrastructure projects aimed at securing carriage in the Euro-Asian transport corridors are being developed. Projects currently nearing completion or completed include a railway line connecting China, Kazakhstan and Mongolia, the Marmaray Tunnel under the Bosphorus Strait in Turkey, and a railway line between Iran and Pakistan that connects the Indian Peninsula with Europe. Still, development of the infrastructure is not the only decisive factor in the utilisation of the potential of long-distance cargo carriage by rail via the Euro-Asian bridge or the territories of the neighbouring states. Other measures are necessary, such as unification of regulation of carriage by different modes of transport (including the limits and size of carrier liability, compensation mechanisms, claims handling etc.) and ensuring that transparent and harmonised transport legal provisions are applied in all the states of the Euro-Asian transport corridor by the same methods and in the same scope, so that complicated procedures and different regulation between the two continents are abandoned. Only in this way railways can compete with both air transport (which completes the carriage in one day) and sea transport (which completes the carriage in 30 days), thus securing a significant share of the market for carriage which is extremely time-sensitive. From the legal standpoint, this would create stability in the civil legal relations and secure legitimate expectations of both clients and carriers. International studies show that carriage by rail can be a suitable alternative for the carriage of Euro-Asian cargoes as the time of order fulfilment is reduced in half compared with sea transport and the price is much lower compared with air carriage ; however, harmonisation of legal norms is necessary. The Republic of Lithuania is one of the few states where international cargo carriage by rail is governed by two different legal acts, namely, the 1999 Uniform Rules Concerning the Contract for the International Transport of Goods by Rail (“CIM”) and the 1951 Agreement on International Goods Transport by Rail (”SMGS”) . Such situation is due to the fact that the Republic of Lithuania, situated near the boundary between Europe and Asia, is a party to two organisations in charge of implementation of the aforesaid legal acts, namely, the OTIF and the OSJD . While the former railway transport organisation is comprised mainly of European states, the members of the latter are mostly Asian.