PAKISTAN Law and Practice Contributed by: Faisal Daudpota, Daudpota International
• Calculation: the fund is calculated using units of account (Special Drawing Rights – SDRs) based on the vessel’s tonnage. It covers claims for loss of life, personal injury, and property damage. • Deposit requirement: a deposit is mandatory. The fund must be constituted by depositing cash or providing a guarantee accepted by the court. Once the fund is established, it prevents claimants from seizing other assets of the shipowner, acting as a “limitation” on liability. 3.6 Seafarers’ Safety and Owners’ Liability The Maritime Labour Convention (MLC), 2006, is now applicable in Pakistan. Pakistan officially ratified the MLC 2006 on 14 March 2025. The ratification signifies that the convention is applica - ble to all Pakistani-flagged vessels engaged in inter - national voyages, setting minimum requirements for working and living conditions. While the MLC 2006 was formally ratified in 2025, the primary legislation governing seafarers’ rights, safety and working conditions in Pakistan is the MSO 2001. Pakistan has adopted the International Convention for the Unification of Certain Rules of Law relating to Bills of Lading (1924) (the “Hague Rules”). This is the pri - mary legal framework governing the carriage of goods by sea and bills of lading. Pakistan has not officially adopted and does not directly apply the more modern Hague-Visby Rules (1968) or the Rotterdam Rules. Domestic Laws Covering Carriage by Sea and Bills of Lading The Carriage of Goods by Sea Act, 1925 (COGSA) and the Sea Carriage Shipping Documents Act, 2018 are both implemented. 4.2 Title to Sue on a Bill of Lading In Pakistan, the right to sue on a bill of lading is gov - erned primarily by the Bills of Lading Act, 1856, which 4. Cargo Claims 4.1 Bills of Lading Applicable International Conventions
is still in force and mirrors English law of that era, granting rights to consignees and endorsees. Fur - thermore, COGSA applies to outward shipments from Pakistan. The following have the title to sue: the consignee, the endorsee, the lawful holder and the shipper. Pakistan recognises the assignment or transfer of the title to sue. 4.3 Ship-Owners’ Liability and Limitation of Liability for Cargo Damages In Pakistan, ship-owners’ liability for cargo damage is generally governed by COGSA, incorporating the Hague Rules, which mandate duty of care in handling, storing and transporting goods. Liability is limited to specific amounts per package or unit unless the value was declared. Actual and contractual carriers face different liabilities, as contractual carriers are directly responsible for the bill of lading, while actual owners may only be liable if the damage occurred during their operational control. Ship-Owner’s Liability for Cargo Damage • Legal framework: Pakistan applies the Hague Rules under COGSA, focusing on the seaworthiness of the vessel and proper care of cargo. • Scope of responsibility: owners are responsible for damage due to improper stowage or crew negli - gence, but are generally exempt from liability for Acts of God, fire on the ship, or the perils of the sea. • Limitation of liability: liability is typically limited to a specific monetary value per package or kilogram under the Hague Rules. Differences: Actual v Contractual Carrier • Contractual carrier (eg, NVOCC/Charterer): issues the bill of lading, bearing primary liability for the entire journey, even if they do not own the ship. • Actual carrier (ship-owner): the owner of the vessel who physically performs the carriage is usually only liable if the damage occurred during their opera - tional control (eg, due to bad stowage), as they may not have a direct contract with the shipper. • Key distinction: the contractual carrier is usually the primary target of claims, while the actual carrier may be sued directly, especially if the bill of lading
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