Carrier liability limits for lost cargo: Hague-Visby, COGSA, Montreal, CMR

The limits by mode of transport

The limits come from international conventions and national laws that apply to the contract of carriage. The amounts are in Special Drawing Rights (SDR), the unit of account defined by the International Monetary Fund, except under the US Carriage of Goods by Sea Act (COGSA), which uses US dollars.

• Sea, Hague-Visby Rules (for example in the UK Carriage of Goods by Sea Act 1971 as amended): 666.67 units of account per package or unit, or 2 units of account per kilogram of gross weight of the goods lost or damaged, whichever is higher.
• Sea, US COGSA: USD 500 per package, or per customary freight unit for goods not shipped in packages, unless the shipper declared the nature and value of the goods before shipment and they were inserted in the bill of lading.
• Air, Montreal Convention 1999: 26 SDR per kilogram for cargo since 28 December 2024, after ICAO's review raised it from 22 SDR, together with the other limits of the convention, by an inflation factor of 17.9%.
• Road, CMR Convention as amended by the 1978 Protocol: 8.33 units of account per kilogram of gross weight short.

A worked example

Take one pallet of 1,000 kg gross weight, shown on the transport document as one package, lost in transit. With the IMF rate of 6 October 2026 (1 SDR = USD 1.354580), the maximum the carrier owes is roughly:

• By sea under Hague-Visby: the higher of 666.67 SDR (one package) and 2,000 SDR (1,000 kg × 2 SDR), so 2,000 SDR, about USD 2,709.
• By sea under US COGSA: USD 500 for the one package.
• By air under the Montreal Convention: 26,000 SDR (1,000 kg × 26 SDR), about USD 35,219.
• By road under CMR: 8,330 SDR (1,000 kg × 8.33 SDR), about USD 11,284.
• If the goods are worth USD 50,000, only cargo insurance or a declared value covers the gap.

How to protect the cargo value

The package count on the bill of lading matters: under per-package limits, a pallet listed as one package is one unit, while cartons listed separately may each count. Each regime allows a higher recovery if the shipper declares the value in the transport document before shipment, usually against a higher freight charge. In practice most exporters and buyers rely on cargo insurance (Institute Cargo Clauses), arranged by whoever carries the risk under the Incoterms rule.