This article is the sixth in a series touching, alphabetically, on select key elements of shipping and transport law in Germany.(1)
Pursuant to section 453 paragraph 1 of the German Commercial Code (HGB), the freight forwarder is obliged to organise the shipment of goods. This means the freight forwarder:
- determines the means of transport;
- determines the route;
- selects the executing companies (in particular, the carrier); and
- concludes the contracts required for the shipment.
According to the “normal” statutory concept, the freight forwarder passes on the costs of the subcontractor (eg, the carrier) and invoices a separate commission for its services. In this situation, the freight forwarder is liable for loss of or damage to the goods in its custody according to section 461 paragraph 1 of the HGB. This strict liability is usually limited to 8.33 special drawing rights per kilogram. However, as the goods are usually not in the freight forwarder’s own custody, but rather in the carrier’s custody, there is only a limited scope of application for this provision. Nevertheless, the freight forwarder might be liable in accordance with section 461 paragraph 2 of the HGB, if they are in breach of obligations normally incumbent on the freight forwarder as set out in section 454 of the HGB or the individual freight forwarding contract. The obligation to select the carrier carefully would, for instance, qualify as such obligation. This liability is unlimited but can be avoided if the freight forwarder can prove that they acted according to the diligence of a prudent businessperson.
In practice, however, and in deviation from the “normal” statutory concept, freight forwarders do not invoice their commission separately, but rather agree on a fixed remuneration. Then the liability concept changes and the freight forwarder has to fulfil the rights and obligations of the carrier and thus, is treated exactly like a carrier according to section 459 of the HGB. They are then subject to strict liability for any loss or damage to the goods if this loss or damage occurred in the carrier’s custody. This liability is usually limited to 8.33 special drawing rights per kilogram. In addition, the freight forwarder remains liable according to section 461 paragraph 2 of the HGB for any breach of its other freight forwarding obligations (excluding the carriage itself) as set out in section 454 of the HGB or in the individual freight forwarding contract (eg, customs clearance, packing and procurement of insurance cover.)
There are two key takeaways:
- Usually, the freight forwarder is treated like a carrier pursuant to sections 458-460 of the HGB, including the liability concept for the carrier.
- There is an unlimited liability pursuant to section 461 paragraph 2 of the HGB for the breach of obligations normally incumbent on the freight forwarder, as specified in section 454 of the HGB.
For further information on this topic please contact Justin Kotthaus at Arnecke Sibeth Dabelstein by telephone (+49 69 97 98 85 0) or email (j.kotthaus@asd-law.com). The Arnecke Sibeth Dabelstein website can be accessed at www.asd-law.com.
Franziska Scheifler, Julia Brennecke, Marco G Remiorz, Marvin Brand, Steffen Maelicke, Sunanda Kalischer and Sybille Rexer assisted in the preparation of this series.
Endnotes