Law firm Colin Biggers & Paisley partner Stuart Hetherington, has warned the federal government to sign up to a new international convention on the carriage of goods by sea, already signed by 21 nations.

The United Nations (UN) Convention on Contracts for the International Carriage of Goods Wholly or Partly by Sea, also known as the Rotterdam Rules, has now been signed by the United States, France, Greece, Denmark, Switzerland and the Netherlands, among others. The current signatories are said to make up over 25 per cent of world trade by volume.

According to Hetherington, it is in Australia’s interests as a modern trading nation to back the new convention, which seeks to consolidate and modernise a “patchwork of piecemeal rules” first conceived in the 19th Century.

“Eighty per cent of world trade is now conducted by sea. Supporting a uniform framework that clarifies the rights and responsibilities of marine cargo carriers and shippers promotes international trade and is in turn good for Australia,” Hetherington said.

“Australia’s regime has been grafted on to the original archaic rules which hark back to a time when cargo was shipped in bags or boxes rather than containers, and communication technology was still in its infancy,” Hetherington said.

“It is generally considered out of date and cumbersome. By contrast, the new convention brings the maritime sector into the 21st Century. It reflects current shipping practices and recognises the impact of e-commerce and electronic communications on shipping transactions."

Hetherington said that the new convention made sensible changes to legal rights and liabilities that reflected the business community’s current expectations.

For instance, the period during which carriers are responsible for the safety of another’s cargo has been extended from the "tackle to tackle" period to include the period from when cargo is received by the carrier to when it is delivered to the consignee at its destination, including at any agreed inland locations.

“This extension of responsibility acknowledges that today, carriers are often part of a larger logistics supply chain and therefore, it is appropriate for their liability to match their delivery obligations”.

“Similarly, the new convention aims to apply modern duty of care concepts more consistently. For example, carriers are made responsible for ensuring the ship is seaworthy and properly crewed throughout the voyage and not just at the port of departure.

“The so-called nautical fault defence has also been scrapped so that ship's masters and crew who have been negligent in navigating or managing the ship can no longer escape liability”.

Australia has more to gain from joining up with the new regime than staying put with the old one, said Hetherington.

“Goods traders and shipping companies will no doubt debate who gets the short straw under the new rules but at a national level, the benefits to Australia of a uniform law are clear.

“With the US having signed, and hopefully moving to ratification soon, it is likely that other major nations will feel greater pressure to commit. Australian traders and shipping companies will have to grapple with the reality of the new regime as it applies to their contractual arrangements once the Rules come into force. It is now timely for the Australian government to back the Rotterdam Rules."