US Carriage of Goods by Sea Act (COGSA)

What is COGSA?

The US Carriage of Goods by Sea Act ("COGSA") is the United States' enactment of the Hague Rules 1924. It was originally enacted on 16 April 1936 as 49 Stat. 1207. In 2006, Congress recodified the statute as a historical note to 46 U.S.C. Chapter 307 under Public Law 109-304 (6 October 2006). The recodification was non-substantive.

The United States has not ratified the Hague-Visby Rules, the Hamburg Rules, or the Rotterdam Rules. COGSA therefore governs carriage of goods by sea to and from US ports.

When COGSA applies

COGSA applies by its own force to every bill of lading or similar document of title for the carriage of goods by sea to or from ports of the United States, in foreign trade. It applies from loading to discharge ("tackle-to-tackle").

Outside that period, the older Harter Act of 1893 fills the gap, unless the bill of lading extends COGSA contractually (a "clause paramount").

Liability limit

The most distinctive feature of COGSA is its $500 per package limit, set in 1936 dollars and never revised by statute. There is no weight-based limit and no SDR mechanism.

Two questions dominate litigation:

1. What is a "package"? A container is generally not itself the package; courts look to the bill of lading. This is the "container-as-package" doctrine.
2. What is a "customary freight unit"? For unpackaged bulk or heavy goods, courts typically use the unit on which freight was calculated.

Time bar

Under COGSA s.3(6), the carrier is discharged from all liability unless suit is brought within one year after delivery or the date when the goods should have been delivered.

Defences available to the carrier

COGSA s.4(2) lists 17 defences substantially identical to Hague Rules Article IV(2), including:

• Nautical fault defence (error in navigation or management of the ship)
• Fire, unless caused by actual fault or privity of the carrier
• Perils, dangers, and accidents of the sea
• Act of God, act of war, act of public enemies
• Quarantine restrictions, strikes or lockouts
• Inherent defect, quality, or vice of the goods
• Insufficiency of packing or marks
• Latent defects not discoverable by due diligence
• "Any other cause arising without the actual fault and privity of the carrier"

The Himalaya Clause

US bills of lading typically include a Himalaya Clause extending COGSA's defences and limits to stevedores, terminal operators, and other contractors. Norfolk Southern Railway Co. v. Kirby (543 U.S. 14, 2004) supports extension of COGSA limits into the inland rail leg where the bill of lading so provides.

Why COGSA matters for non-US shippers

Any shipment to or from a US port is presumptively governed by COGSA on the sea leg. For Malaysian exporters shipping to the US: do not rely on the carrier's COGSA liability to make you whole. Full-value marine cargo insurance on ICC (A) is the standard protection.

COGSA vs Hague-Visby - key differences

FAQ

Q: Is COGSA still in force? Yes. In force since 1936, recodified 2006 under PL 109-304.

Q: Does COGSA apply to inland US rail or trucking? Not by its own force. Bills of lading routinely extend COGSA contractually via clause paramount and Himalaya Clauses.

Q: Has Congress considered updating the $500 limit? Proposals have been introduced but never enacted. The $500 figure is unchanged since 1936.

Q: How does COGSA apply to Malaysian exports to the US? On the sea leg to a US port, COGSA applies by its own terms. Cargo insurance responds separately under the Institute Cargo Clauses.

Q: What is a Himalaya Clause? A clause extending the carrier's defences to stevedores and agents. Named after Adler v Dickson (1955).

Official source

• US Code - 46 U.S.C. Chapter 307
• Related: Hague-Visby Rules | Institute Cargo Clauses | Incoterms 2020