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T.Doc.107-15 TREATY WITH HONDURAS FOR RETURN OF STOLEN, ROBBED, AND EMBEZZLED ...


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107th Congress                                              Treaty Doc.
                                 SENATE                     
 2d Session                                                   107-14
_______________________________________________________________________

                                     



 
  PROTOCOL TO AMEND THE CONVENTION FOR UNIFICATION OF CERTAIN RULES 
               RELATING TO INTERNATIONAL CARRIAGE BY AIR

                               __________

                                MESSAGE

                                  from

                   THE PRESIDENT OF THE UNITED STATES

                              transmitting

PROTOCOL TO AMEND THE CONVENTION FOR THE UNIFICATION OF CERTAIN RULES 
  RELATING TO INTERNATIONAL CARRIAGE BY AIR SIGNED AT WARSAW ON OCTOBER 
  12, 1929, DONE AT THE HAGUE, SEPTEMBER 28, 1955 (THE HAGUE PROTOCOL)

<GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT>


July 31, 2002.--The Protocol was read the first time, and together with 
  the accompanying papers, referred to the Committee on Foreign Relations 
  and ordered to be printed for the use of the Senate
                               __________

                    U.S. GOVERNMENT PRINTING OFFICE
99-118                    WASHINGTON : 2002

                         LETTER OF TRANSMITTAL

                              ----------                              

                                    The White House, July 31, 2002.
To the Senate of the United States:
    I transmit herewith, for Senate advice and consent to 
ratification, the Protocol to Amend the Convention for the 
Unification of Certain Rules Relating to International Carriage 
by Air Signed at Warsaw on October 12, 1929, done at The Hague 
September 28, 1955 (The Hague Protocol). The report of the 
Department of State, including an article-by-article analysis, 
is enclosed for the information of the Senate in connection 
with its consideration of The Hague Protocol.
    The Warsaw Convention is the first in a series of treaties 
relating to international carriage by air. The Hague Protocol 
amended certain of the Warsaw Convention articles, including 
several affecting the rights of carriers of international air 
cargo. A recent court decision held that since the United 
States had ratified the Warsaw Convention but had not ratified 
The Hague Protocol, and the Republic of Korea had ratified The 
Hague Protocol but had not ratified the Warsaw Convention, 
there were no relevant treaty relations between the United 
States and Korea. This decision has created uncertainty within 
the air transportation industry regarding the scope of treaty 
relations between the United States and the 78 countries that 
are parties only to the Warsaw Convention and The Hague 
Protocol. Thus, U.S. carriers may not be able to rely on the 
provisions in the Protocol with respect to claims arising from 
the transportation or air cargo between the United States and 
those 78 countries. In addition to quickly affording U.S. 
carriers the protections of those provisions, ratification of 
the Protocol would establish relations with Korea and the five 
additional countries (El Salvador, Grenada, Lithuania, Monaco, 
and Swaziland) that are parties only to The Hague Protocol and 
to no other treaty on the subject.
    A new Convention for the Unification of Certain Rules for 
International Carriage by Air, done at Montreal May 28, 1999 
(the ``Montreal Convention'') is pending on the Senate's 
Executive calendar (Treaty Doc. 106-45). I urge the Senate to 
give its advice and consent to that Convention, which will 
ultimately establish modern, uniform liability rules applicable 
to international air transport of passengers, cargo, and mail 
among its parties. But the incremental pace of achieving 
widespread adoption of the Montreal Convention should not be 
allowed to delay the benefits that ratification of The Hague 
Protocol would afford U.S. carriers of cargo to and from the 84 
countries with which it would promptly enter into force.
    I recommend that the Senate give early and favorable 
consideration to The Hague Protocol and that the Senate give 
its advice and consent to ratification.

                                                    George W. Bush.
                          LETTER OF SUBMITTAL

                              ----------                              

                                    The Secretary of State,
                                         Washington, June 15, 2002.
The President.
    I have the honor to submit to you the Protocol to Amend the 
Convention for the Unification of Certain Rules Relating to 
International Carriage by Air Signed at Warsaw on October 12, 
1929, done at The Hague September 28, 1955 (``The Hague 
Protocol'' or ``the Protocol''). The Protocol was signed on 
behalf of the United States on June 28, 1956 and was submitted 
to the Senate for its advice and consent to ratification in 
1959. It was returned to the President in 1967. The 
circumstances that precluded ratification and led to the return 
of the Protocol in 1967 have fundamentally changed, and I now 
recommend that it be re-transmitted to the Senate for its 
advice and consent to ratification.


                               BACKGROUND


Overview
    The 1929 Warsaw Convention has been the subject of several 
amendments and unsuccessful attempts at amendments over the 
years. In 1955, The Hague Protocol, which doubled the passenger 
liability limits and simplified cargo documentation 
requirements, was adopted and was later ratified by most 
countries, but not by the United States. In 1971, the Guatemala 
Protocol again sought to raise the passenger limits, but was 
ratified by very few States and never entered into force. In 
1975, the so-called Montreal Protocols (Nos. 1-4) were adopted. 
Of these four protocols, the United States is a party only to 
Montreal Protocol No. 4, which amended the Warsaw Convention as 
amended by The Hague Protocol, modifying the cargo provisions 
of that instrument without altering the passenger provisions. 
In 1999, a new Convention was adopted to eliminate in their 
entirety the passenger liability limits and modernize the other 
provisions of the Warsaw Convention and The Hague Protocol. The 
1999 Convention is intended ultimately to replace the Warsaw 
Convention and its various amendments. The United States signed 
the 1999 Montreal Convention, and it was submitted for Senate 
advice and consent to ratification in September 2000.
            1. The Warsaw Convention and The Hague Protocol
    The Convention for the Unification of Certain Rules 
Relating to International Carriage by Air, done at Warsaw 
October 12, 1929 (the ``Warsaw Convention''), provided 
limitations on liability and uniform liability rules applicable 
to international air transport of passengers, cargo and mail. 
The Warsaw Convention was widely adopted, and the United States 
has been a party since 1934. The Convention contained a very 
low limit on the liability of carriers (approximately $8,300 
per passenger at that time) for death or injury to passengers 
in international air carrier accidents where the harm was not 
due to the carrier's willful misconduct. Efforts to increase 
this limit in the early 1950s led to The Hague Protocol, which 
doubled the passenger liability limit and made other technical 
improvements to the Convention, most notably in the area of 
cargo documentation.
    President Eisenhower submitted The Hague Protocol to the 
Senate for its advice and consent to ratification on July 24, 
1959. Because of concerns regarding the inadequacy of the new 
limit on passenger recoveries, the Administration sought 
enactment of a form of accident insurance legislation in 
conjunction with ratification of the Protocol. The proposed 
legislation would have required U.S. carriers to carry 
supplemental accident insurance policies for each passenger in 
international air travel to or from the United States covered 
by the Warsaw Convention. It fixed various levels of 
compensation based upon the type of injury sustained by the 
passenger, up to $50,000. The insurance legislation package 
failed, and The Hague Protocol was eventually returned to the 
President in 1967.
            2. The Montreal Inter-carrier Agreement (1966)
    The failure of the insurance legislation package, coupled 
with increasing dissatisfaction with the liability limits in 
the Warsaw Convention, led the United States to submit a notice 
of denunciation of the Warsaw Convention in November, 1965. In 
1966, the United States withdrew this notice of denunciation 
before it went into effect, in consideration of a private 
voluntary agreement, negotiated under the auspices of the 
International Air Transport Association (IATA), which was 
signed by all major foreign and U.S. carriers serving the 
United States (the ``Montreal Inter-carrier Agreement''). the 
Montreal Inter-carrier Agreement ensured that accident victims 
on flights to or from the United States are compensated for up 
to $75,000 of proven damages, whether or not the negligence of 
the carrier was the cause of the accident. In time, all foreign 
carriers operating services to or from the United States 
accepted the terms of the Montreal Inter-carrier Agreement, and 
in 1983 the Civil Aeronautics Board adopted regulations 
mandating participation (14 C.F.R. Part 203).
            3. The 1975 Montreal Protocols
    Although further diplomatic efforts were made to improve 
the Warsaw Convention during the 1960s and 1970s, continuing 
concerns regarding low passenger liability limits in part 
prevented the United States from adopting new amendments to the 
Convention. (See Message from the President of the United 
States Transmitting the Convention for the Unification of 
Certain Rules for International Carriage by Air, done at 
Montreal, May 28, 1999, Treaty Doc. 106-45, 106th Cong., 2nd 
Session, for more information regarding these diplomatic 
efforts and the development of the Warsaw Convention system.) 
In particular, four protocols were negotiated at the 1975 
diplomatic conference in Montreal. The first three of these 
protocols replaced the gold standard with the currency 
conversion formula based on ``Special Drawing Rights'' 
(hereinafter referred to as ``SDRs'', an artificial ``basket'' 
currency developed by the International Monetary Fund for 
internal accounting purposes) for purposes of calculating all 
quantitative limitations on liability under the Warsaw 
Convention, The Hague Protocol, and a 1971 protocol to the 
Convention negotiated at Guatemala to which the United States 
did not become a party. (As of 1975, only two States had 
ratified the Guatemala Protocol.) The fourth protocol, the 
Protocol to Amend the Convention for the Unification of Certain 
Rules Relating to International Carriage by Air, as amended by 
The Hague Protocol, done at Montreal September 25, 1975 
(``Montreal Protocol No. 4''), among other things eliminated 
the outmoded cargo documentation provisions of the Warsaw 
Convention, thereby facilitating the application of electronic 
commerce to international air cargo. Although the United States 
signed Montreal Protocol No. 4, efforts to achieve Senate 
advice and consent to ratification of this protocol in the 
1980s and early 1990s, in conjunction with one of the other 
protocols negotiated at Montreal that applied to passengers and 
adopted the SDR standard, were unsuccessful due in large part 
to concerns about the limits on passenger recoveries from the 
Guatemala Protocol that had been incorporated into the other 
protocol.
            4. The IATA and ATA Inter-carrier Agreements (1997)
    Recognizing the inadequacy of existing liability limits, 
air carriers reached agreement in 1996 on three inter-carrier 
agreements. In February 1997, the Department of Transportation 
approved two IATA and one Air Transport Association (``ATA'') 
agreements, all of which, at a minimum, waived the Warsaw 
Convention liability limits in their entirety for participating 
carriers, in effect superseding the 1996 Montreal Inter-carrier 
Agreement by which carriers had earlier waived the limits on 
liability up to $75,000 per passenger.
    As of March 6, 2002, 123 international carriers, 
representing more than ninety percent of the world's air 
transport industry, had signed the IATA Inter-carrier Agreement 
on Passenger Liability (``IIA''), which waives the Warsaw 
liability limits. Most of the carriers signing the IIA also 
signed the second IATA agreement, which requires carriers to 
pay up to 100,000 SDRs (approximately $135,000) to accident 
victims, regardless of carrier negligence. Consequently, any 
accident victim having a claim against a carrier that was party 
to this second IATA agreement would have an absolute right to 
recover up to 100,000 SDRs of proven damages. The ATA 
agreement, signed only by U.S. carriers, describes the manner 
in which carriers agree to implement the two IATA agreements. 
In addition to waiving the Warsaw liability limit for passenger 
injuries and accepting 100,000 SDRs of strict liability, 
airlines signatory to the ATA agreement also agree, subject to 
applicable law, that compensation for passenger injuries may be 
determined by reference to the law of the domicile or permanent 
residence of the passenger.
            5. Montreal Protocol No. 4 and Cargo Operations
    In the wake of the IATA and ATA Inter-carrier Agreements, 
the passenger liability limitations contained in the Warsaw 
Convention and the The Hague Protocol, although objectionable 
in principle to the United States, were no longer a significant 
obstacle because they were, as a practical matter, superseded 
in most cases by the IATA and ATA Inter-carrier Agreements, by 
which most major international scheduled carriers had waived 
those limits. The United States was thus in a position to 
modernize the rules relating to the air cargo industry. With 
the advice and consent of the Senate, the United States 
ratified Montreal Protocol No. 4 on December 4, 1998; it 
entered into force for the United States on March 4, 1999. 
Among other things, this Protocol eliminated requirements for 
paper-based transactions, including the requirement to complete 
detailed air waybills.
            6. The 1999 Montreal Convention
    The IIA and Montreal Protocol No. 4 together represented a 
reasonable interim fix, but not a long-term solution, to the 
problem of creating a modernized uniform liability regime for 
international air transportation. At present, carriers are 
subject to vastly different liability regimes, depending upon 
the treaties to which their governments are parties and the 
private inter-carrier agreements that they have signed. Work on 
a modernized convention to replace the fragmented Warsaw 
Convention system was completed at the May 1999 International 
Conference on Air Law in Montreal at which the Convention for 
the Unification of Certain Rules for International Carriage by 
Air, done at Montreal May 28, 1999 (the ``1999 Montreal 
Convention''), was negotiated and opened for signature. The 
United States immediately signed the 1999 Montreal Convention. 
The President transmitted it to the Senate for advice and 
consent to ratification (Treaty Doc. 106-45) on September 6, 
2000. This Convention was a success with respect to all key 
U.S. policy objectives, and once in force and widely ratified, 
will replace the Warsaw Convention and its patchwork of 
liability regimes, including the need for private voluntary 
agreements.
            7. Chubb & Son, Inc. v. Asiana Airlines
    A recent decision by the U.S. Court of Appeals for the 
Second Circuit in the case of Chubb & Son, Inc. v. Asiana 
Airlines (214 F.3d 301 (2d Cir. 2000), cert. denied, 121 S. Ct. 
2459 (2001)) has highlighted the fragmentation of the Warsaw 
Convention system and raised uncertainties regarding the 

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