Increase in Air carrier limit of liability under Montreal Convention

Increase in Air carrier limit of liability under Montreal Convention

From 19 SDR to 22 SDR

The International Civil Aviation Organisation (ICAO) has recently announced an update to the Montreal Convention 1999, which sets out limitation in respect of air carrier liability for loss and damage to cargo during international carriage by air.

The maximum liability of air carriers has been revised from 19 Special Drawing Rights (SDR) per kg to 22 SDR per kg

This reflects a 13.9% increase over the limits that have been in effect since late 2009 when the last amendment came into force. This has been done to take into account inflationary factors. The increase is based on the ‘escalator clause’ in Article 24(1) of the Montreal Convention 1999 which requires the ICAO to review the liability limits in the convention every five years.

The revisions have been approved by States Parties to the Convention and is effective from 28th December 2019.

The increase will provide for higher levels of recovery in cases of air cargo claims. However, insurers providing liability insurance cover to international air carriers should also be aware of the revised limits which will naturally also increase their claims exposure due to the increased levels of compensation that shall become due.

The official announcement by ICAO is as below:

Pursuant to the 2019 review of the limits of liability conducted by ICAO under Article 24 of the Convention for the Unification of Certain Rules for International Carriage by Air, done at Montréal on 28 May 1999 (Doc 9740) (Montreal Convention of 1999), the revised limits of liability established under Articles 21 and 22 of the said Convention, in Special Drawing Rights (SDRs), effective as of 28 December 2019, are as set out in the fourth column of the following table:

Montreal Convention of 1999

Original limit (SDRs)

Revised limit (SDRs) as of 30 December 2009

Revised limit (SDRs) effective 28 December 2019

Article 22, paragraph 3

17 SDR/kg

19 SDR/kg

22 SDR/kg

A full list of the most common current Conventions can be found on our website http://www.wecoxclaimsgroup.com/assets/conventions.pdf

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