How is Commercial liability determined under Shipping Law in UAE?


The shipping or maritime law imposes certain liabilities on the carrier for losses/ damages that have been incurred to the goods. This begins from the receipt of the goods to the loading of the same thereof at the ports until the goods are delivered at the discharge ports. The liability is enumerated under Article 275 of the Shipping Laws.

UAE Shipping Laws

For protection and regulation of rights and to govern sea trading smoothly, the country has enacted special Maritime law that is known as the UAE Maritime Law. The law was enacted in 1981 i.e. the Federal Law No. 26 of 1981 on Maritime Commercial Law to operate maritime trade.

The Maritime or the Shipping Law is similar to the LLMC 76 however, the limitations of liability claims in the former are different from the LLMC 76. Articles 138 to 142 of the Maritime Law specifically provide the ship-owners, workers, and charterers the right to restrict the liability of any claim as per the size and weight of the vessel.

Article 137 of the Maritime Law provides that the ship-owner under civil law shall be responsible for the acts and omissions that are committed by the master, or crew of a ship. It further provides that any person working in the vessel under the authority of the ship-owner while performing his duties in the vessel shall also be held liable.

The owner shall have recourse against the person who has committed a mistake or offence. Further, Article 138 of Maritime Law permits the owner to restrict his liability towards particular claims resulting from various obligations and liabilities.

Relevant provisions of Maritime Law

Under Article 276 of the Maritime Law, the extent of the limitation of the carrier’s liability for cargo claims is discussed. This provision of the law restricts the liability for loss or damage that is caused to goods to a maximum amount of AED 10, for each “package or unit,” or an amount not exceeding AED 30 per kilo of the gross weight of the goods, whichever is higher.

This Article also protects the carrier by limiting his liability against the shipper in case the shipper has already declared the nature/ value of the goods in the Bill of Lading. It is noteworthy that if the shipper purposefully provides false particulars of the goods’ including the value and nature on the bill of lading, then in that case the carrier would be released from all liabilities i.e. any harm or loss caused to the particular goods. The shipper may agree on an upper limit of the carrier’s liability.

Article 299 of the Shipping Law states a time limit for the liability of claims. It provides that liability claims for a passenger’s death/ injury can be claimed within 2 years of such incidence. After the expiry of the said limitation, such a claim would not be liable to be heard. The time limitation for the claims for arrival delay is six months.

Exemption of liability of the carrier

The carrier may be exempted from this liability only when he can establish the fact that the damage or destruction of the goods caused due to the following causes:

  1. The carries must establish that the obligations provided under Article 272 are discharged;
  2. Errors occurred in the navigation or management of the vessel by the master, pilot or other maritime subordinates;
  3. Fire caused in the vessel which was not due to the fault of the carrier;
  4. Sea dangers or other navigable waters, or dangers or incidents thereof;
  5. Act of God;
  6. Damage is caused due to war;
  7. Any detention or constraint by a power, State, people or judicial arrest;
  8. Pandemic or quarantine restrictions.
  9. Loss is caused due to strikes or layoffs or obstacles causing discontinuance of the work;
  10. Damage due to civil unrest and commotions;
  11. Act of the shipper or owner of goods;
  12. Improper packaging or marking of the goods;
  13. Damage caused due to rescue of persons or property at sea;
  14. Latent defects are not discoverable by ordinary examination;
  15. Deviation from a course during the rescue;
  16. Any other cause that is not because of the carrier.


Onus on carrier

It must be noted that the carrier raising any of the above pleas, the onus of proof rests on him and he must establish that there has been no failure on his part that has caused the damages or losses. If the shipper successfully proves that such losses or damages have arisen from the failure of the carrier or the persons working under him then the carrier needs to prove his contentions beyond reasonable doubts.


In 1970, as the oil boom in the UAE, the seaports have significantly contributed to the country’s gross domestic product that has developed a strong maritime industry. The UAE ports have constantly implemented definitive and proactive measures to ensure the welfare of personnel, seafarers and port operators. The UAE is composed to establish a regional hub for cargoes, catering to the requirement of the industries in the wider Gulf, especially, Saudi Arabia.