While planning a shipment of goods, there are multiple approaches and modes of transportation to choose from. The ideal route can be determined through overall costs, transportation time, efforts of logistics, and effects on the environment. Furthermore, for the same road, a single mode of transport or a combination of modes of transport may be used, which would be particularly beneficial for long shipments. What are the key advantages and disadvantages of using unimodal or multimodal goods transportation?
Unimodal transportation refers to transportation wherein the goods are transported by a single mode of transport, including by road, railways, sea, inland waterway, air, space, and pipeline. In a nutshell, it refers to the transportation of goods through a single mode of transportation.
In sea shipping, where the goods are transported by a single carrier that issues its own transport contract, a bill of lading from one port to another is the common situation, however, If there are several carriers, such as for carriage from one port to another port (transshipment at intermediate port) and then to the ultimate destination port, the very first carrier in control may issue a via bill of lading containing the whole transport with complete responsibility and liability for the complete port-to-port transport. This is also known as Unimodal transportation.
Two or more modes of transportation, such as road, rail, sea, and air, can be combined to provide the most efficient shipping feasible. Multimodal and intermodal transportation are the two types of combined transportation.
They can be utilized for long-distance deliveries as well as when the client has a tight delivery deadline or a package that requires special care.
It is a sort of transportation that transports commodities from one location to another across international borders using at least 2 forms of transportation. It entails transporting freight in an intermodal container or vehicle across an intermodal transport chain, which allows the integration of several transportation networks, while avoiding any handling of the freight itself while changing modes.
The goal of intermodal transportation is to eliminate cargo handling throughout transit, improve cargo protection, increase security, and decrease commodity damage and loss. Furthermore, it would improve transportation performance by utilizing the most productive modalities. Long-haul transport, for example, may be done by rail or inland canal, while delivery flexibility and efficiency will be handled by truck.
Containerized rail transportation is sometimes referred to as intermodal in North America. Instead of a series of legs, each indicated by an independent transport operation with distinct sets of paperwork and freight charges including carriers, intermodal transport focuses on a single full trip with a single carrier contract.
“European Conference of Ministers of Transport (ECMT) defines “Multimodal Transport” as “the carriage of goods by at least two different modes of transport.”
“The United Nations Convention on International Multimodal Transport of Goods, 1980 or MT Convention” defines as “the carriage of goods by at least two different modes of transport on the basis of a multimodal transport contract from a place in one country at which the goods are taken in charge by the multimodal transport operator to a place designated for delivery in a different country. The operations of pick-up and delivery of goods carried out in the performance of a Unimodal transport contract, as defined in such contract, shall not be considered as international multimodal transport.”
The definition of International multimodal transport in “United Nations Convention on International Multimodal Transport of Goods” is the same as in “ASEAN Framework agreement on Multimodal Transport.”
At the core of the scheme, the Multimodal Transport Operator must be able to design, evaluate, and schedule transportation systems, as well as provide efficient transportation at a reasonable expense and in less time on specific routes. Multimodal transport, by legal standard, “is a contract for the carriage of goods that includes an agreement by a carrier known as the Multimodal Transport Operator to conduct carriage of goods using at least two separate modes of transportation from the point where the goods are taken in care to the point of delivery.” This means that the carrier accepts responsibility for the whole carriage in the complete transportation chain, even though the carrier only performs part of the carriage or none at all. Although the consignor may only receive one transport document for the whole journey, the multimodal transport operator can accept several documents from the sub-carrier or his subcontractors.
In essence, International Multimodal transportation is mainly composed of:
- It should be an international transport among two or more nations,
- A minimum of two means of transportation must be used,
- It must be carried out by a Multimodal Transport Operator who is in command of the whole carriage,
- Carriage of Goods Contract, Certificate of Title, and Cargo Receipt are all included in a single document.
What is the difference between Intermodal and Multimodal Transport?
The primary distinction among intermodal and multimodal transportation is the form of contract used and the quantity of transportation administration required. Let’s take the case of a shipment from the United States to Italy.
The item is collected by a truck and driven to the port, where it is then sent to Europe by sea and delivered by railway to the consignee’s city. When using intermodal shipping, each part of transportation must be organized separately with distinct carriers, each according to their own agreement. Although intermodal shipping necessitates additional logistical work, it allows the sender to negotiate terms with every logistics provider.
If a firm picks multimodal transportation, the entire cargo will be covered by one contractual arrangement with only one logistics provider. This indicates that only one logistics provider is accountable for the whole transportation, even if some portions are outsourced to sub-carriers known as “real carriers.” Because the entire transit is coordinated by a single organization, this method of transportation involves less logistics coordination.
Why is there a need for Multimodal Transport?
Trade is vital at every stage of the supply chain, from raw materials through interim production or processing to ultimate consuming of commodities, and it involves a number of parties, including seller, buyer, and service provider. It is difficult to dispute that transportation aids trade, and that trade never progresses without it. Transportation can be a barrier to commerce for a variety of reasons, including transportation rules and regulations, common carrier service availability, physical connectivity, excessive cost, and established practice.
To ease the transport difficulty, traders may seek 3PLs (Third Party Logistics Service Provider) to lend a hand in logistics operations. Thus, traders may focus on their main business and cut in logistics expenses because of greater expertise of Multimodal Transport Operators or 3PLs. Specialized 3PLs are becoming increasingly focused on making the most efficient and effective use of their own transportation network. The cost and quality of transportation are improving as a result of using multimodal transportation to improve trade movement from one location to another.
What are the documents required for Multimodal and Intermodal Shipping?
The Bill of Lading is one of the most crucial papers to have when exporting cargo overseas. It includes the consignee’s, carrier’s, and shipper’s names, as well as details regarding the sort of items being transported.
There will be just one contract and one Bill of Lading when employing a multimodal service. The document is issued by the competent logistics provider, commonly known as a multimodal transport operator (MTO). In this instance, it is called “multimodal or combined transport Bill of Lading”. When using an intermodal service, the only distinction is that rather than only one document, you’ll have multiple Bills of Ladings, one per carrier.
Advantage and Disadvantage of Unimodal Transport
Transportation, it goes without saying, facilitates foreign commerce by transferring products from supplier to customer. When the economy becomes globalized, there are benefits and drawbacks to using Unimodal. Unimodal transportation, in most instances, offers port-to-port or terminal-to-terminal service rather than point-to-point service, unless road transport is used from the beginning to the end of the journey.
- If land transportation is used, unimodal transport will provide door-to-door shipment. However, where there is no physical connection for a truck to drive and trucking costs are not in the economy range, there are limitations. Unimodal shipping, on the other hand, is mostly used to transport goods from one terminal to another or from one port to another.
- If goods are either delivered from port to port or terminal to terminal, unimodal transport is much more cost-effective; however, when goods must be transported beyond the ports or terminals, multimodal transport is more cost-effective when a single deal is made and the Trader does not need to locate carriers to take over the shipment for the second leg of transportation and so on.
What types of transport can be combined in Multimodal Shipping?
According to the path and timing, many modes of transportation may be chosen. Express goods are usually shipped by air, although intercontinental goods may be shipped by water. In an ideal world, all modes of transportation might be merged to provide the most cost-effective option. Road, sea, and air transportation are the most common modes of freight transport. When sending single parcels, however, a mix of trucks and airplanes is typically the best option.
Advantages of Multimodal Transport
Consulting with one operator
When working with different operators or common carriers, this tends to prevent misunderstanding and complication of all matters relating to transportation.
This will also help with one-stop contact for tracking and tracing items before and after their journey.
Considering with one single document
The consignor or consignee will work with a single paper, the Multimodal Transport Bill of Lading, published by the Multimodal Transport Operator. It would not only potentially prevent the burden of numerous paperwork along the entire transportation line, but it would also prevent the burden of other formalities on each transport leg associated throughout the transportation chain.
Make in time
Various times, owing to poor supply chain and logistics management in many situations, the consignor’s production is delayed, and the arrival period is insufficient for the Maritime transport transit time. Using air mode to reach the distribution deadline is too expensive. As a result, multimodal transportation is an alternate form of transportation that combines two modes of transportation to ensure that the package arrives on schedule. Multimodal Transport also benefits from the Operator’s technical support, which allows for a shorter transit time.
Dealing with a single service provider will allow a consignor or consignee to spend less time preparing and arranging different segments of the transportation chain while remaining worry-free.
Disadvantages of Multimodal Transportation of Goods
It will not be possible to select a sub-provider that works on a specific section of the route.
Every provider’s pricing cannot be negotiated.
The Law’s Journey from Unimodality to Multimodalism
Items can be delivered using a single service or a set of vendors of one kind simpler or special modes, based on the kinds of carriage agreements to be signed between a consignor and a service. The unimodal shipping agreement is the classic or traditional form of such an agreement, in which an unaccompanied service involves items from one point of dispatch to another point of destination. If the service is provided by a ship, such considerations are unquestionably distinct ports.
In the traditional multimodal shipping, the shipper prefers to deal with only one party to coordinate the whole shipment. The criminal issues that may arise in the case of unimodal delivery are minor in contrast to those that may arise if the deal were for multimodal delivery. In the latter case, products are delivered by at least one or more modes of transportation, such as buses and ships, cars and ships, or airplanes, among others.
A shipment can be shipped using either method of transportation, depending on the circumstances. Freight forwarders, providers, and multimodal operators facilitate these types of contracts. A freight forwarder could also serve as the shipper’s agent and contribute to the compilation of carriage contracts for each provider, which would then be issued to their corresponding criminal regimes. Items could be shipped at the expense of the shipping owner under such arrangements, with no private legal liability on the freight forwarder’s part.
When multimodalism evolved, providers adopted practices for the issuing of multimodal bills of lading. Historically, most ocean carriers have provided bills of lading that account for legal responsibility of services entirely dependent on a “community device” of appropriate legal responsibility regimes (the legal responsibility gets limited by choosing community device). The legal obligation of each connecting provider is governed by the legislation applicable to each step of transportation under this scheme.
Among the providers, the rights of indemnity and contribution are governed likewise. Under those cases, each provider restricts its legal liability to the process that it conducts, and the applicable legislation is specified to tour with the shipment in a few situations, in comparison to the community device of liabilities, multimodal bills of lading which furthermore indicate that the issuing provider takes legal responsibility all over the whole period of transportation. This is known as the uniform system.
The Quantum Case
The English case known as Quantum is a notable example of the current uncertainty around multimodal arrangements and the manner in which courts treat this legal jungle.
In September, 1998, Air France imposed a Singapore air waybill to the claimants, Quantum Corporation, for the carriage of hard disk drives – with a claimed value of US$1.5 million – from Singapore to Dublin. The plan was to fly from Singapore to Paris, then drive and ship from Paris to Dublin across the Irish Sea. The master air waybill contained this information. This method has traditionally been used to transport a significant number of related consignments containing the same parties.
The carriage for the trucking leg was handled by Air France’s regular contractors, Plane Trucking. Employees of Plane Trucking stole the freight when it was in their possession in the United Kingdom. Plane Trucking claimed responsibility for the theft, but by the time of the trial, it was in liquidation. The insurance insurers for Plane Trucking had claimed to be able to avoid the policy. Liability was also acknowledged by Air France.
Air France said that “its General Conditions were integrated into the carriage contract by terms in the air waybill. Air France’s responsibility was reduced to SDRs 17 per kilogram under Article 11.7 of the Air France conditions.” Unlike the Warsaw Convention, the conditions did not exclude Air France from depending on the per kilo restriction “whether the failure was caused by an act or omission of the carrier, his agents or servants, committed with the intent to inflict harm, or recklessly and with expectation that damage would almost certainly occur.”
Claimants argued that Air France’s responsibility for the Paris-Dublin leg was governed by the Convention on Contracts for the International Carriage of Goods by Road (‘CMR’). The Convention’s first article stated that it was applicable to “Every contract for the carriage of goods by road in vehicles for reward, when the place of taking over of the goods and the place designated for delivery, as specified in the contract, are situated in two different countries, of which at least one is a Contracting country.”
“France is a contracting country to the CMR Convention”
For the purposes of Article 6(1)(d)) of the Convention, “The consignment note shall contain the following particulars… the place and date of taking over delivery….”, the products were allegedly seized over in Paris, according to the claimants. The carrier may restrict its responsibility under Article 23 of the Convention to SDRs 8.33 per kilo of goods lost or destroyed. The airline, however, is not allowed to use the limitation set out in Article 23 whether the loss or injury was incurred by its wilful wrongdoing, according to Article 29 of the Convention or that of “the agents or servants of the carrier, or [of] any other persons of whose services [the carrier] makes use for the performance of the carriage.”
Mance LJ delivered the judgment of the court. He defined the issue to be addressed as “What constitutes a ‘contract for the carriage of goods by road’ within the meaning of Art.1 of CMR.” He agreed that “the question should be addressed on the basis that, while carriage by road via Paris to Dublin was Air France’s planned mode of performance, Air France was not contractually obligated to do so and could have transported the goods on that leg by air if they so desired. The air waybill specifically stated that the contract was for two legs, the first of which would be completed by air and the second by truck, unless Air France choose to use another mode of transportation, as their Conditions allowed.”
“Disagreements among German, Dutch, and English courts of law, as well as among these countries’ courts, highlight the fact that the law that applies to a multimodal contract is unclear at the get go; it depends on which court is approached and how the extent of interpretation laws of the theoretically applicable regimes is understood by said court.”
The method of transportation has evolved over time, and more recently, as containerization was introduced, a variety of container-based transportation concepts emerged. The style of transportation has evolved from Unimodal Transport, in which a single carrier, such as a freight line, transports containers from port to port, to multimodal Transport. The main distinction between unimodal and multimodal transportation is the number of transports used during the transportation trip.
To properly assess the various delivery modalities, it is critical to first comprehend the meanings of each of those words. In unimodal transportation of goods, the goods have adopted the use of a single mode of shipment, especially by way of road, since it is the most environmentally friendly for door-to-door deliveries. To get the most environmentally friendly cargo possible, different modes of transport, such as highway, rail, sea, and air, can be combined. Combined transportation can be known as multimodal. They can be utilized not only for long-distance deliveries, but also when the customer has a tight delivery deadline or has a cargo that requires special handling.
 The Warsaw Convention, art.25.
BY UROOSA SHAHZAD | DELHI METROPOLITAN EDUCATION (G.G.S.I.P UNIVERSITY)