Since its enactment in 1993, the Chinese Maritime Code (CMC) has served as the cornerstone of maritime transport law in China. Closely aligned with the Hague-Visby Rules (HVR), it governs the rights and obligations of carriers and cargo interests while reflecting unique Chinese judicial practices.
Cargo shortage and damage claims are among the most common disputes faced by shipowners, charterers, and insurers at Chinese ports. Recent case law from the Supreme People’s Court (SPC) sheds light on how courts handle evidentiary conflicts, particularly in bulk cargo shipments.
Cargo Shortages and the Evidentiary Role of Draft Surveys
One of the most frequent disputes in China arises from cargo shortage claims, especially in bulk trades involving lightering operations at draft-limited ports. These operations often create discrepancies between ship draft surveys and shore scale measurements.
In 2022, the SPC clarified that carriers may be exempt from liability for shortages caused by natural loss, permissible measurement errors, or trade allowances, provided they can produce credible evidence. Courts generally give greater weight to draft surveys conducted closest to the point of discharge, especially when carried out by independent or jointly appointed surveyors.
The SDTR DORA case (2023) confirmed this principle, with Tianjin courts favoring carrier-arranged draft surveys over Customs’ shore scale figures. The ruling reinforced the need for independent surveys, photographic evidence, and joint participation of cargo interests to mitigate the risk of shortage claims.
Cargo Damage and the High Burden of Proof on Carriers
Beyond shortages, physical damage claims, particularly for heat-damaged soybeans, are common in China. Under the CMC, if a clean bill of lading was issued, the carrier bears the burden of proving that damage resulted from inherent vice or pre-existing conditions rather than negligence.
Chinese courts closely scrutinize ventilation logs and temperature records to assess whether due diligence was exercised. Even when carriers demonstrate proper ventilation practices, courts may still apportion liability if records are deemed incomplete or unrepresentative, as seen in the MV DREAM STAR case. This illustrates the high evidentiary standard imposed on carriers, often stricter than English law.
Quality-related claims further highlight the courts’ stance: carriers are responsible only for the apparent condition of cargo at loading. Cases like MV MEGALOHARI and MV Bulk Aquila confirmed that carriers are not liable for hidden defects, even if clean bills of lading were issued.
Procedural Challenges: Carrier Identity, Time Bars, and Charterparty References
The CMC incorporates features from the Hamburg Rules, distinguishing between contractual and actual carriers. While courts once extended liability to time charterers, recent cases suggest a narrowing of this approach.
Cargo claims in China are subject to a strict one-year time bar under Article 257, with no scope for extension by agreement. This makes early dispute resolution, including mediation and CMAC arbitration, increasingly important.
Finally, the omission of a charterparty date in bills of lading undermines incorporation of arbitration or governing law clauses. Unless clearly referenced, Chinese courts assume jurisdiction and apply domestic law, limiting the enforceability of foreign arbitration agreements.
The Chinese Maritime Code reflects international conventions but is applied through a distinct domestic lens. Carriers face a higher evidentiary burden in China, particularly when defending shortage and damage claims involving bulk agricultural cargoes. Draft surveys, ventilation logs, and meticulous recordkeeping remain critical to building a credible defence. Procedural issues such as time bars and charterparty references further complicate litigation strategy.
In short, while the CMC provides a familiar legal framework, the judicial practice in China places shipowners and charterers under stricter obligations than in many other jurisdictions. Proactive measures such as appointing independent surveyors, maintaining detailed cargo care records, and drafting bills of lading with precision are essential to minimizing liability risks in Chinese courts.
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Source: Gard
