Logistics: Bite-Size Insights - July 2022
In this edition, we consider the latest requirements for hauliers transporting goods throughout Europe, the Competition Appeal Tribunal’s decision allowing a claim on behalf of the whole UK road haulage industry against the ‘cartel’ truck companies, wilful misconduct under the CMR, and the end of additional cabotage rights.
2022: new beginnings for international road haulage
As part of the UK-EU Trade and Cooperation Agreement there are new rules for the transport of goods by road throughout Europe. The new rules will affect UK goods vehicle operators transporting goods using cars, trailers, vans, light and heavy goods vehicles.
As of 21 May 2022, drivers will need a vehicle operator licence and a qualified transport manager to move goods through Europe. In order to obtain the required vehicle operator licence, a haulier will need to show that they have access to a set amount of capital to run the business. The amount is £1,600 for the first vehicle and £800 per additional vehicle. Whilst these sums may not seem too onerous, with margins already squeezed these additional ‘costs’ will need to be factored into the running costs of the business.
It is worth noting that if a haulier does not have a transport manager, an application can be made to be temporarily recognised as a transport manager.
This is in addition to the requirement from 2 February 2022 for all drivers to declare that they are transporting goods inside the EU, Iceland, Liechtenstein and Norway. The industry will be pleased to note that there is no fee for making this declaration, and that this requirement only applies when moving goods between two points in the EU – there is no need to make such a declaration when one of the points is the UK.
If the declaration is not made, then the haulier can face significant penalties. It is highly unlikely that an insurance policy would cover such penalties, nor is it something that could be passed on to a customer. It is, therefore, a cost that the haulier would have to bear.
It is vital that haulage companies are aware of these new requirements as any penalties or claims for delays are unlikely to be covered by an insurance policy. Therefore, if the customer imposes penalties on the haulier for a delay in delivery due to the haulier failing to comply with the new requirements, there is likely to be little or no cover for such claims.
Contacts: Shaan Burton
Additional cabotage rights – update from the UK government
In our December 2021 edition, we reported on the Department for Transport (DfT) decision to allow unlimited cabotage movements for foreign hauliers for up to 14 days after arriving in the UK. This meant that when a non-UK operator entered the UK, that haulier could then carry out an unlimited number of domestic movements for a period of 14 days.
The aim was that if non-UK hauliers were permitted to carry out additional movements, this would ease the demand on domestic haulage companies. The extension was agreed on 28 October 2021 and continued until 30 April 2022.
On 9 March, the DfT sought views on the potential for continuing or ending the existing flexibility in road cabotage rules for foreign hauliers. On 21 June, the consultation outcome was published, stating that the decision had been made not to continue the additional cabotage rights beyond 30 April 2022 at this time.
Department for Transport analysis indicates that the take-up of the additional cabotage rights was low, although the consultation responses did show that it was helpful in the run-up to Christmas 2021.
The DfT has stated that it will continue to keep supply chain pressures under review and if later in the year these pressures increase, they will consider whether a short-term reintroduction of additional cabotage rights measures could assist.
UKTC and RHA to pursue a multi-billion euro claim against eight European truck manufacturers
On 8 June 2022 the Competition Appeal Tribunal handed down judgment, allowing the applications for Collective Proceedings Order brought by UK Trucks Claim (UKTC) and the Road Haulage Association (RHA).
The applications followed a 2016 decision, in which the European Commission found that five major European truck manufacturing groups had carried out a single continuous infringement over a period of 14 years between 1997 and 2011. The infringement concerned the exchange of information on future gross prices, and collusion on the timing and passing on of costs of the introduction of emission technologies required by trucks weighing six or more tonnes, referred to as “medium and heavy trucks”.
The decision imposed fines exceeding €2.9 billion, with both UKTC and the RHA claiming follow-on damages arising from the infringement.
The RHA is now entitled to bring a claim on behalf of the whole UK road haulage industry, which is estimated to be around 18,000 claimants. The claim is being pursued against truck manufacturers, DAF, Iveco and MAN. The RHA has commented that it will be inviting all qualifying operatives to join the claim.
Contact: Shaan Burton
Wilful misconduct under the CMR revisited by the High Court
In the recent case of Knapfield v Cars Holdings Ltd [13.06.2022], the English High Court was asked to consider the application of wilful misconduct under the Convention on the Contract for the International Carriage of Goods by Road 1956 (the CMR), and provided helpful clarification on the level of conduct required to break the CMR’s limits of liability.
The court concluded that the cause of the damage to a vehicle was the inadequate securing of the front wheel straps which caused the vehicle to slide backwards.
Whilst that failure of securing the vehicle was perhaps negligent, it was not deemed reckless or deliberate. Further, a failure to follow instructions was also not sufficient to establish wilful misconduct under the CMR – again, it was deemed to be negligent, but not reckless or deliberate. The mental element of appreciating the risk and being reckless or deliberate was not established.
Accordingly, the defendant was permitted to rely on the limits of liability within the CMR.
It is important that hauliers and insurers are aware of the test applicable to wilful misconduct under the CMR. It can have a significant impact upon liability, given the possibility of breaking the limits where wilful misconduct is established.
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