18 August, 2017
When the Montreal Convention 1999 came into force in 2003, the Convention was widely seen as a modern and international liability regime governing air carrier liability overhauling the outdated Warsaw system of carrier's liability. Today, the Montreal Convention 1999 enjoys broad success, with 126 countries now party to it. Thailand is the latest key trading nation to take steps to implement the Montreal Convention 1999, having deposited its accession to the Convention with the International Civil Aviation Organization (ICAO) on 4 August 2017. The Montreal Convention 1999 will therefore come into force in Thailand on 2 October 2017. This is welcome (albeit somewhat surprising) news for the aviation industry. Whilst Thailand took its own legislative steps towards modernisation in 2015, this move will provide further uniformity to the regulation of international carriage by air to and from Thailand and other State Parties. This is especially relevant with the anticipated growth arising from a single aviation market among the Association of South East Asian (ASEAN) members through the ASEAN Open Skies, which to date is fully ratified.
Although Thailand has historically been reluctant to ratify any of the international aviation Conventions, the recent accession of Thailand to the Montreal Convention 1999 may not be as remarkable as it first seems. Rather, it confirms the willingness of the Thai Government to reform and modernise its laws relating to air carriers' liability, steps which it had earlier taken in 2015 when Thailand introduced the International Carriage by Air Act 2015 (ICAA). The ICAA in essence sets out a liability framework similar to that of the Montreal Convention 1999. When this law was introduced, claimants were no longer forced to rely on the provisions of the Thai Civil and Commercial Code for claims against air carriers. It provided the benefit to claimants of higher liability limits reflecting those of the Montreal Convention 1999 for death and/or bodily injury, baggage and cargo, which previously may only have been available as contractual limits indicated in carrier general conditions of carriage.
In addition to claimants gaining access to Thailand as a "fifth jurisdiction" for claims to be brought under Article 33 of the Montreal Convention and the option for parties to refer the disputes to arbitration in accordance with Article 34 of the Montreal Convention 1999, Thailand's accession to the Montreal Convention 1999 will also assist to eliminate differences that were present in the ICAA compared to Montreal Convention 1999. Furthermore, in construing claims in a local context, the Thai courts will be able to examine the interpretation of the language of the Montreal Convention 1999 against the interpretation in other jurisdictions worldwide, which will hopefully provide a more harmonised legal framework in relation to claims in Thailand and provide greater certainty for airlines and their insurers.
Details of any enacting legislation are not yet made public (whether this will be achieved through drafting changes of the ICAA to more closely mirror the Montreal Convention or otherwise) and we will report further in due course. At a practical level, carriers should benefit from greater levels of certainty in terms of passenger rights and reduced baggage as well cargo claim litigation. In the meantime, this is a good opportunity to consider any necessary review of carrier general conditions of carriage to keep up with the soon to be amended legal framework.
For further information, please contact:
Paul Freeman, Partner, Clyde & Co