TT Club releases coronavirus guidance to transport operators

In addition to the heightened challenges transport operators are facing in moving their customers’ goods to and from China, insurance provider TT Club is advising on the unforeseen exposures that may also accrue.

In a briefing compiled with the assistance of international lawyers HFW, TT Club has outlined how freight forwarders, logistics service providers and other intermediaries can protect themselves legally and minimise their liabilities, while still giving a quality service to their customers.

Restrictions due to labour shortages at ports and cancellations of inland transport links within China, constraints in the supply of goods due to factory closures and reduced schedules of air, ocean and rail carriers may expose forwarders to claims arising from delivery delays and cargo deterioration.

The TT Club briefing details these pitfalls and provides guidance on correct and comprehensive documentation handling. It highlights the need for transport operators to be proactive in their communication.

“Up-to-date status reports on their cargo’s progress, or lack of it, are vital to shippers,” emphasised TT Club risk management director Peregrine Storrs-Fox. “Forwarders and logistics operators will certainly prove their mettle if they can consistently make customers aware of the ongoing attempts to problem-solve. Careful recording of communication trails detailing such actions will also help in any disputes in the future.”

A statement added “In attempting to deliver such solutions, however, a forwarder may need to use routes, carriers or modes that are less familiar, or to partner with other actors, of whom he has no experience.

“Such ‘workarounds’ are common at times of crisis when pressure from customers to deliver freight by whatever means can be intense. Additional care and due diligence must be taken when working in unfamiliar environments. It might be necessary to take extra precautions in employing bills of lading, standard trading conditions, letters of indemnity and other means to protect the stakeholders from unforeseen costs and liabilities.”

The briefing explains these risks and the steps that can be taken to keep them to a minimum. TT Club’s statement added “Underlying most of these steps is good communication. For example, if force majeure notices are required to be sent, it must be ensured that these are fully understood by the recipient. In other cases, when delays or deviations are caused by matters genuinely outside the operator’s control, then these circumstances must be well documented.”