Shippers urges caution in ratification of Rotterdam Rules

The Ghana Shippers Authority (CEO) has called for a ‘wait and see’ approach from the country towards whether or not it should adopt and ratify the Rotterdam Rules, a set of maritime industry regulations meant to govern international carriage of goods.

But while doing that, the authority said the country should use that period of observation to sensitise its stakeholders – the importer and exporter community – to the requirements and benefits of the rules.

The rules were adopted by the United Nations (UN) in 2008 to replace The Hague/Visvi and Hamburg Rules, which have been in operation for decades. 

The Chief Executive Officer of the GSA, Dr Emmanuel Kofi Mbiah, explained in Accra that the need for caution against speed was needed to give Ghana a clear picture of which of its trading partners were ratifying the new rules.

“If you rush in ratifying, it may not help. Sometimes, you need to look at your other trading partners; you are trading with other countries and you don’t want what happened to the Hamburg Rules to happen to the Rotterdam ones, where marginal maritime countries will accept it, it comes into force but it is actually not being applied,” Dr Mbiah said in an interview after a sensitisation workshop in Accra.

Benefits

When it comes to Hamburg Rules for instance, although many countries, including Ghana, signed on to it, only four countries ratified the convention – making it difficult for the regulation to come into full operation.

At the workshop, Dr Mbiah, who chairs the Legal Committee of the International Maritime Organisation, said the Rotterdam Rules were developed to cure the various defects identified in The Hague/Visvi and the Hamberg Rules.

As a result, he said, the Rotterdam Rules provided more benefits and opportunities to the shipping community than their predecessors, hence the need for Ghana and its peers to adopt and ratify it.

The new rules are expected to help reduce the cost of shipment, address the issue of delays and widen the coverage of responsibility from the current port-to-port to door-to-door, where the cargo carriers will be forced to take full responsibility for the cargo from the point of collection to delivery.

Of concern was the issue of jurisdiction, where dispute hearings arising from cargo handlings were confined to specific foreign countries under the The Hague/Visvi and Hamburg Rules.   

“Under the new rules, it is possible for Ghana to assume jurisdiction when the goods land in this country and that is a great advantage to the importer,” Dr Mbiah said.

Currently, agreements on maritime trades in the country are done under The Hague/Visvi Rules, which Ghana ratified in the 1920s.

In 2009, the country signed on to the Rotterdam Rules, making it one of over 30 countries to have done that.

However, given that signing on to a convention does not give it the legal right to adopt same, the country now needs to ratify the Rotterdam Rules to make it legal for cargo carriage to and from the country’s sovereign waters to be conducted on it.

In doing that, however, the CEO of the shippers’ authority said the country must endeavour to monitor the reactions of big industry players such as the United States of America and neighbouring Nigeria before ratifying.

“It appears everybody looking up to the United States of America. Once they ratify, then many countries will very likely follow and we in Ghana should also do so,” Dr Mbiah said.

China, which is arguably the biggest trader in the world, has signalled it is not in support of the rules citing the regulation on limitation of liability as too high for its interest.

“That means that the decision of the USA is now the only country shippers could look up to influence the adoption and ratification of the Rotterdam Rules”, Dr Mbiah said.

"Nigeria, for instance, is also a force to reckon with. So, once these countries ratify, then Ghana, Côte d'Ivoire could also join and that will be significant as far as trade is concern,” Dr Mbiah said.

When contacted, the Chief Director of the Ministry of Transport, said the country would be taking a final decision on the issue of ratification after receiving clear advice from industry stakeholders, including the shippers' authority.