Unified Railway Law Mr. Konstantinos Alexopoulos Secretary Group of Experts on Unified Railway Law

Many Legal Instruments INLAND WATER TRANSPORT We create a level playing field for Railways! ONE Legal Instrument ONE liability system ONE consignment note Many Legal Instruments ROAD United Nations Convention on the Contract for the International Carriage of Goods by Road (CMR) of 1956 MARITIME Hague-Visby and Hamburg Rules Chicago Convention and other treaties (Warsaw, Montreal Conventions) AIR INLAND WATER TRANSPORT Budapest Convention on the Contract for the Carriage of Goods by Inland Waterways (CMNI) of 2001 We create a level playing field for Railways! Unified Railway Law COTIF Convention SMGS Agreement Many other regional and National agreements RAIL I believe that we all agree that railway freight transport is the only transport mode that does not benefit from a globally uniform, or at least harmonized, legal framework. Consequently, railways cannot compete on a level playing field with other modes of transport on international long-distance routes. That is why railways undertakings, the market, the cargo owners and the freight forwarders require a solution today. The UNECE secretariat’s mandate is to work towards the Unified Railway Law by making sure that: • The experience and suggestions of both OSJD and OTIF, but also of other relevant organizations, such as CIT, UIC, CER, EEC and EU, are fully incorporated into relevant provisions; • The relevant provisions of the new unified legal regime are free from impediments that made railways inefficient in the past while still fully respecting regional requirements and needs; and • The solution suggested follows a step by step approach that ensures optimal results as well as an efficient solution for the market in two years maximum - and not 15 years from today.

The lack of a Unified Railway Law is: Why is the Unified Railway Law needed? The Global Rail Network COTIF Convention Reconsignement Point SMGS Agreement Other National or Regional Rail Legal Regimes 1 extra employee for translation; 1 extra employee for inspection; Office & administration costs; ~$10 per consignment note (sometimes 1 container more than 1 C.N.) ~ 20 min per C.N. 1 block train with 45 containers has extra cost of ~ $ 1100 and ~ 18 hours delay! Needless to mention mistakes, inspections at next borders etc. The lack of a Unified Railway Law is: Source of extra costs Source of extra time Source of corruption Obstacle to railways development

First step towards the Unified Railway Law! The main principles The new legal railway regime would only apply if the parties to the rail transport contract, i.e. the consignor and the railway enterprise concluding the contract of carriage so decide and agree that the new legal railway regime should apply (opting-in). Thus, application of the new legal railway regime by the rail industry would be voluntary. Unified Railway Law 1 contract of carriage 1 consignment note (CIM/SMGS) 1 liability regime Nonetheless, rail transport of goods between China or the Russian Federation and Germany could still continue to use, as is the case today, a mix of national, COTIF/CIM and SMGS laws where that two separate contracts of carriage would be concluded: one relating to the carriage of goods within the States parties to SMGS, another one relating to the carriage of goods within the States parties to COTIF/CIM. This will, however entail, re-consignment procedures at the borders between the COTIF/CIM and SMGS regimes. COTIF/CIM 1 contract of carriage (CIM) 1 consignment note (CIM) 1 liability system (CIM) SMGS 1 contract of carriage (SMGS) 1 consigment note (SMGS) 1 liability system (SMGS) The new legal railway regime could facilitate international rail transport of goods and containers between China or the Russian Federation and Germany without any re-consignment at the borders of the COTIF/CIM and SMGS regimes on the basis of a single contract of carriage. Similarly, rail transport between Europe and Turkey to the Middle East or to Pakistan and India could, in the future, be carried out with the new legal railway regime. Reconsignement Point 2 contracts of carriage (CIM+SMGS) 2 consignment notes (CIM+SMGS) 2 liability systems

01 02 03 04 05 01 02 03 04 05 Today - Many Regimes Tomorrow Source of extra costs 02 Source of extra time COTIF Convention area 03 Source of uncertified levies SMGS Agreement area 04 Obstacle to railways development Other regional or local rail regimes 05 Source of uncertainty Tomorrow - One Regime 01 One Contract of Carriage 02 One Consignment Note 03 One International Rail Regime – Unified Railway Law Increased Railways Competitiveness 04 One Liability System 05 No extra cost & time

UNECE, URL, pilot tests in 2017 I. Inland Transport Committee, Resolution from 26 February 2016: The ITC called on the railways and their international organisations to test, when possible, new legal provisions drafted by a group of UNECE experts. II. Correspondence between the four railways' chief executives: In September 2016, the chief executives of railways agreed on pilot tests to try out the URL.

Unified Railway Law (URL) objectives: Offering a harmonised international legal framework for Europe-Asia rail freight transports. Creating the same conditions for railways as their road-, ocean- and air- based competitors with regard to a harmonised legal framework. Voluntary application of URL by the railways and their customers for certain transports. The current combined CIM/SMGS model will remain in place for partners that wish to retain it.

Further Unified Railway Law (URL) objectives: If URL is applied, there is no reconsignment of freight in transit: there is only one transport contract that covers the entire route. URL harmonises regulations that are at present handled differently in CIM and SMGS (or in applicable national law).

URL's advantages over CIM and SMGS: Simplifies regulations Simplifies handling and documentation Reduces and speeds up administration processes Strengthens contractual freedom for parties

URL's further advantages over CIM and SMGS: Ensures uniform minimum standards during entire transport Integrates pre-carriage and onward carriage using other modes of transport in the uniform rail transport contract; uniform URL application Ensures a uniform level of minimum liability for carriers Strengthens the competitiveness of international rail freight services

When it comes to concluding and implementing transport contracts, there are no fundamental changes: Transport documents Costs Division of tasks Later instructions Tackling problems Freight delivery Exception: the carrier's formal report is replaced with a claim for damages from the customer.

VI. Changes concerning liability: The basis for liability (damage while freight was in carrier's care) remains unchanged. Exclusions of liability have been tightened up and reduced. Compensation limits have been redefined. Carrier no longer has unlimited liability.

Other changes concerning liability: Liability for overrunning delivery deadlines is dependent on the occurrence of damage, and it is increased The carrier can voluntarily increase its liability; the consignor's liability can be reduced One thing remains unchanged: the carrier responsible bears liability

Summary URL offers railways and their customers the following advantages: Harmonised legal system Fewer and tighter regulations No need for reconsignment of freight in transit Integration of pre-carriage and onward carriage with other modes of transport in URL's comprehensive application Uniform level of minimum liability for participating carriers if they are responsible for damage

New Terms of Reference for next two years (a) Monitor the finalization of necessary documents in order to perform international rail transport under the unified railway law including a standard model for the consignment note for the new provisions and its manual; (b) Monitor the performance of a substantial number of real pilot tests to be carried out by the railway companies involved in the Group along the corridors agreed and along other corridors if proposed by governments in order to ensure the operational validity and effectiveness of the legal provisions prepared; (c) Draft a document (or systems of documents) on Unified Railway Law which could be adopted as a legally binding instrument; the document (or systems of documents) shall: (i) take into account the draft legal provisions on the contract of carriage already prepared; (ii) include the necessary formal provisions such as depository, management, secretariat, administrative committee, amending procedures, voting rights, etc.; (iii) be structured in a way which allows to easily supplement it with provisions on other issues related to international rail freight transport where the Group considers it appropriate to do so; (d) Discuss other relevant issues related to international rail freight transport with a view to adding, where appropriate, provisions to the document referred to at (c); these issues may include: (i) Common Provisions on dangerous goods; (ii) Common provisions on the use of freight wagons; (iii) Common provisions on rail infrastructure; (iv) Common provisions on rolling stock.