Money

Nepal advances to be part of Montreal Convention

  • The convention stipulates higher compensation for accidents, flight/cargo delays and damages involving international flights than that prescribed by the Warsaw Convention
- SANGAM PRASAIN, Kathmandu

Jul 16, 2018-Nepal’s accession to the Montreal Convention 1999 (MC99) has moved a step closer as the Cabinet’s Economic and Infrastructure Committee has approved the draft bill tabled by the Tourism Ministry.

Tourism Secretary Krishna Prasad Devkota said the committee approved the draft to be forwarded to the Cabinet. “After the Cabinet’s go-ahead, it will be tabled in Parliament,” he said.

After the accession is passed by Parliament, the Nepal government will deposit the ratification instrument with the International Civil Aviation Organization (ICAO) in Montreal, Canada.

MC99 stipulates higher compensation for accidents involving international flights than that prescribed by the Warsaw Convention. “If parliament gives its approval, ratification will follow. Once it is ratified, travellers will benefit from fairer compensation and greater protection,” said Devkota.

The convention imposes a minimum liability of $113,100 Special Drawing Rights (SDR), equivalent to $158,565 for each passenger. This works out to approximately Rs17.44 million at the current exchange rates ($1=110), unless the airline proves that such damage was due not to its negligence or other wrongful act or omission.

Currently, Nepali airlines are governed by the Warsaw Convention drafted in 1929. The pact capped damages for injury or death at $8,300 per passenger. This was replaced by The Hague Protocol, a treaty signed on September 28, 1955 in The Hague, which amended the Warsaw Convention. The limit prescribed by the amendment is $20,000 per passenger.

Currently, Nepali airlines operating on international routes provide a minimum of Rs2 million as compensation in case of death of a passenger. However, the compensation amount depends on the insurance policy of the particular airline.

Similarly, the liability for delay is limited to 4,694 SDRs ($6,580.94) or Rs723,903 per passenger. A carrier’s liability for damage or loss of baggage is limited to 1,131 SDRs ($1,585.65) or Rs174,421 per passenger.

The carrier’s liability limitation for cargo lost, damaged or delayed shall be 19 SDRs per kg ($26.63) or Rs2,929 per kg.

MC99, formally the Convention for the Unification of Certain Rules for International Carriage by Air, is a multilateral treaty adopted by a diplomatic meeting of the ICAO member states in 1999.

Nepal has not signed the convention, although the process was initiated in 2010.

The crash of Dhaka-based US-Bangla Airlines Flight 211 at Tribhuvan International Airport in March came as an eye-opener.

The delay in signing MC99 has prevented the victims’ families from receiving a reasonable payout. Neither Nepal nor Bangladesh has signed the convention.

However, clarity on whether its provisions would also apply to domestic carriers within Nepal has been awaited.

 

 

Discussions are ongoing on whether the provisions should also apply to domestic carriage.

It will depend on the government’s decision.

If the government deems it necessary, it will be applied uniformly to both domestic and international carriers of Nepal. Otherwise a separate piece of legislation will be needed to reflect the principles of the Montreal Convention, said Pramod Nepal, under-secretary of the Tourism Ministry.

Nepali domestic airlines have been opposing the government’s move to fix a uniform liability amount equal to international airlines.

Montreal convention

Minimum liability of $158,565 for each passenger, or Rs17.44 million

Liability for delay is limited to $6,580 or Rs723,903 per passenger

Liability for damage or loss of baggage is $1,585 or Rs174,421 per passenger

Liability limitation for cargo lost, damaged or delayed is $26.63 or Rs2,929 per kg

Published: 16-07-2018 08:51

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