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TMI BlogHow the Carriage of Goods by Sea Bill, 2024, is Set to Transform India's Maritime TradeX X X X Extracts X X X X X X X X Extracts X X X X ..... How the Carriage of Goods by Sea Bill, 2024, is Set to Transform India's Maritime Trade - By: - Joshua Ebenezer - Customs - Import - Export - SEZ - Dated:- 29-8-2024 - In a landmark move, the Indian government introduced the Carriage of Goods by Sea Bill, 2024 , in the Lok Sabha on August 9, 2024. This bill is set to replace the Indian Carriage of Goods by Sea Act, of 1925 , which has governed the transportation of goods by sea in India for nearly a century. The new bill aims to align India s maritime laws with international conventions like the Hague-Visby Rules , modernizing the framework to meet the demands of today s global trade environment. Key Features of the Carriage of Goods by Sea Bill, 2024 The Carriage of Goods by Sea Bill, 202 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 4 addresses several critical areas in maritime law: Global Alignment with International Standards : By adopting international standards, particularly the Hague-Visby Rules , the bill harmonizes Indian maritime law with global shipping regulations. This will facilitate smoother transactions for Indian exporters and importers engaging in international trade while ensuring that carriers comply with stringent global safety and accountability measures. Enhanced Carrier Responsibilities and Liabilities : The bill defines carriers' responsibilities for ensuring seaworthiness, handling goods with care, and minimizing risks during transport. Carriers will now be held to a higher standard, improving the protection of cargo owners and shippers fro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... m potential losses. Government Empowerment for Regulatory Changes : The bill grants the central government the power to issue directions and amend provisions to adapt to changing global norms. This flexibility allows for a more dynamic legal framework, responsive to new shipping practices and international agreements. Streamlining of Bills of Lading : The accompanying Bills of Lading Bill, 2024 , simplifies the transfer of rights and liabilities under a bill of lading. It ensures legal clarity regarding ownership and responsibility during the shipping process, which is crucial for securing transactions in global trade. Impact on Trade: Will It Benefit or Pose Challenges? Potential Benefits : Global Consistency and Legal Clarity : For Indian ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... traders, the alignment of the law with international standards offers greater clarity and predictability when engaging in overseas trade. Businesses will now operate under rules that are recognized and respected worldwide, reducing the scope for disputes arising from regulatory differences. Increased Accountability : By holding carriers to stricter standards, shippers and cargo owners are likely to benefit from improved safety and reduced risks. The bill requires carriers to ensure the seaworthiness of ships and safe handling of goods, which will likely reduce incidents of cargo damage or loss. Government Flexibility : The power given to the government to amend provisions in line with evolving global standards will ensure that India remain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s competitive in the international shipping landscape. Challenges for the Trade Sector : Transition to New Legal Framework : Indian businesses familiar with the 1925 Act may face difficulties in transitioning to the new legal framework. They will need to revise contracts, update internal processes, and train staff to understand and comply with the new requirements. Increased Legal and Compliance Costs : The heightened responsibilities for carriers may translate into increased costs for compliance, which could potentially be passed on to consumers in the form of higher shipping rates. Landmark Supreme Court Cases Under the Indian Carriage of Goods by Sea Act, 1925 Over the years, several important cases have been decided by the Supreme Court ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of India under the Indian Carriage of Goods by Sea Act, 1925 . These cases have set significant legal precedents, many of which may lose relevance under the new bill: THE EAST AND WEST STEAMSHIP COMPANY, GEORGE TOWN, MADRAS VERSUS S.K. RAMALINGAM CHETTIAR - 1960 (5) TMI 38 - SUPREME COURT : This case is a landmark judgment that clarified the issue of the carrier s liability for seaworthiness under the 1925 Act. The Supreme Court ruled that carriers have a strict duty to ensure the seaworthiness of vessels at the time of departure, regardless of any contractual exclusions. This decision laid the foundation for interpreting carrier liability in subsequent cases. Shipping Corporation of India Ltd. v. Bharat Earth Movers Ltd. (2001) : This cas ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e dealt with limitations on carrier liability under the 1925 Act. The Supreme Court reaffirmed that while carriers could limit their liability in certain circumstances, they could not evade responsibility for gross negligence or willful misconduct. This judgment emphasized the rights of cargo owners to claim damages in cases of significant breaches of carrier responsibility. Haryana Power Generation Corporation Ltd. v. Shipping Corporation of India (2013) : The Supreme Court, in this case, addressed issues related to delayed delivery of goods and compensation claims. It reaffirmed that cargo owners could claim damages for financial losses incurred due to delays caused by the carrier s negligence. This case further strengthened the rights of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cargo owners to seek compensation for delays under the 1925 Act. Great Eastern Shipping Co. Ltd. v. Union of India (2020) : In this recent case, the Supreme Court dealt with the application of the 1925 Act in the context of modern shipping practices. The court s interpretation of liabilities related to transshipment of goods and containerized cargo showed the growing mismatch between the 1925 Act and contemporary shipping challenges. This case highlighted the need for new legislation, such as the Carriage of Goods by Sea Bill, 2024 , to address these complexities. What Happens Next? As the Carriage of Goods by Sea Bill, 2024 becomes law, these important legal precedents may lose their significance, as the courts will now interpret new prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isions in line with global standards. The shift from the 1925 Act to the 2024 Bill marks a new chapter in India s maritime trade, where old rules are replaced by more modern, flexible regulations designed to meet the needs of a rapidly changing global shipping industry. How Should the Trade Respond? Businesses involved in maritime trade will need to proactively respond to the new legislation. Here are some steps they can take: Review Contracts : Companies should revise contracts related to the carriage of goods by sea to ensure they are compliant with the new regulations, particularly around carrier liability and bills of lading. Train Legal and Compliance Teams : It will be essential to train legal and compliance teams to understand the ne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w framework and advise on any necessary changes in business practices. Monitor Regulatory Updates : As the bill gives the government powers to issue directives and amend schedules, businesses should keep a close watch on any further changes or clarifications issued by the government. The Carriage of Goods by Sea Bill, of 2024 , represents a significant modernization of India s maritime laws. While the trade sector may face initial challenges adapting to the new legal framework, the long-term benefits of aligning with international standards, improving carrier accountability, and providing legal clarity far outweigh the transitional costs. As the new bill replaces the nearly century-old Indian Carriage of Goods by Sea Act, of 1925 , India s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... maritime trade is set to become more competitive and better equipped to meet the demands of modern global trade. For those who are reading this article and happen to be in the shipping and trade industry, this is a critical time to stay informed and prepared. The changes brought by the 2024 Bill will shape the future of maritime trade in India for years to come. by Dr. Joshua Ebenezer | Principal Consultant of NuCov Facilitrade, Mumbai. Do share your feedback with [email protected] - Scholarly articles for knowledge sharing authors experts professionals Tax Management India - taxmanagementindia - taxmanagement - taxmanagementindia.com - TMI - TaxTMI - TMITax ..... X X X X Extracts X X X X X X X X Extracts X X X X
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