Carrier Liability: Limit of 8.33 SDR per kilogram

“The carrier has CMR insurance, so in the event of an accident, we’ll be reimbursed for the full value of the goods”—this is one of the most dangerous misconceptions in international logistics.

Carrier liability insurance and cargo insurance protect different financial interests. The carrier’s policy covers its liability within the limits set by law, international conventions, and the terms of the insurance contract. It does not mean that the owner will automatically receive the full amount specified in the commercial invoice.

In international road transport, the amount of compensation may be limited to 8.33 SDR per kilogram of lost cargo. For light and high-value goods, this amount often represents only a small fraction of the actual value of the shipment.

When the CMR Convention Applies

The CMR Convention governs contracts for international road transport if the cargo is accepted in one country and delivered to another, and at least one of these countries is a party to the Convention.

For most commercial routes between Ukraine and European countries, the CMR rules are directly applicable. Ukraine has also acceded to the 1978 Protocol, which established the liability limit in Special Drawing Rights (SDRs).

The terms of carriage, details about the goods, the number of packages, weight, and remarks by the parties are recorded in the international waybill. Therefore, correctly filling out the CMR is important not only for crossing the border but also for the subsequent handling of claims.

What does the limit of 8.33 SDR/kg mean?

SDR stands for Special Drawing Right. It is an international unit of account whose value is determined by the International Monetary Fund based on a basket of currencies.

The SDR exchange rate fluctuates daily, so the liability limit cannot be permanently converted into a fixed amount in euros or dollars.

The following formula is used for an approximate calculation:

Liability limit = weight of lost cargo × 8.33 SDR

For example, if a cargo unit weighing 500 kg is completely lost:

500 × 8.33 = 4,165 SDR

If an entire shipment weighing 3,000 kg is lost:

3,000 × 8.33 = 24,990 SDR

At the exchange rate as of September 2, 2026, 1 SDR was approximately 1.18 euros. Consequently, 8.33 SDRs corresponded to approximately 9.84 euros per kilogram. This conversion is provided for illustrative purposes only: when reviewing a specific claim, the current exchange rate and applicable conversion rules are used.

An Example Where Compensation Is Insufficient

Suppose a company is transporting electronic components:

• the value of the shipment is 80,000 euros;
• the gross weight is 500 kg;
• the cargo was completely lost as a result of an incident.

Approximate liability limit:

500 kg × 8.33 SDR = 4,165 SDR

At the approximate exchange rate indicated above, this amounts to approximately 4,920 euros. Thus, the potential difference between the value of the shipment and the liability limit exceeds 75,000 euros.

The fact that the carrier holds a policy with a total insured amount, for example, 250,000 euros, does not in itself change the situation. The insured amount of the policy represents the maximum limit of the insurer’s liability to the carrier, but the payment for a specific incident is calculated based on the carrier’s actual and legally established liability.

If the carrier’s liability is limited to 4,165 SDRs, having a policy for 250,000 euros does not mean that the cargo owner will receive the full 80,000 euros.

The limit is a maximum, not a guaranteed payment

The amount of 8.33 SDR/kg is not a fixed compensation for any damage to or loss of cargo. It is an upper limit that applies if:

• the carrier’s liability has been established;
• the fact of loss or damage has been confirmed;
• the extent of the damage has been proven;
• there is a causal link between the incident and the damage;
• there are no grounds for exempting the carrier from liability;
• the deadlines and procedures for filing a claim have been followed.

If the actual value of the lost goods is below the established limit, the payment is not increased to 8.33 SDR/kg. Compensation is payable for proven damage, but not in excess of the applicable limit.

For example, a shipment weighing 20,000 kg is worth 60,000 euros. The calculated weight-based limit will exceed the value of the goods; however, it is not possible to claim an amount in excess of the actual damage.

Consequently, the limit of 8.33 SDR/kg is particularly critical for goods with a high value per kilogram: electronics, pharmaceutical products, components, instruments, equipment, and expensive chemical raw materials.

How Compensation Is Calculated in Case of Damage

In the event of total or partial loss, the value of the goods at the place and time of acceptance for carriage applies, subject to the provisions of the CMR.

If the goods are not lost but damaged, compensation is determined based on the reduction in their value. In this case, the amount of compensation is also limited to the amount that could have been claimed in the event of the loss of the entire shipment or the damaged portion thereof.

This means that the mere fact that goods valued at 100,000 euros have been damaged does not in itself create an obligation to pay 100,000 euros. It is necessary to determine:

• which part of the shipment was damaged;
• by how much its value has decreased;
• whether the goods can be restored;
• whether they are suitable for further use or sale;
• the weight of the damaged portion;
• who is liable for the damage.

Upon discovering defects, it is important to immediately take the steps described in the article What to Do in Case of Cargo Damage.

When a Carrier May Be Exempt from Liability

The CMR provides for circumstances under which a carrier may be fully or partially exempt from liability.

These may include, in particular:

• actions or errors on the part of the claimant;
• instructions from the shipper not caused by an error on the part of the carrier;
• the inherent nature of the goods;
• circumstances that the carrier could not have avoided;
• insufficient or unsuitable packaging;
• loading or unloading performed by the shipper or the consignee;
• insufficient marking of cargo units;
• damage related to the properties of the goods themselves.

For example, if the goods were damaged because the packaging was not designed to withstand the normal stresses of road transport, liability may be disputed. The same applies to situations where the shipper improperly loaded the goods on their own or failed to inform the carrier of important characteristics of the goods.

When organizing logistics for packaged cargo, it is necessary to agree in advance on the type of packaging, the weight of each package, stackability, and the method of securing the cargo.

Carrier Liability and Cargo Insurance—What’s the Difference

After paying the insurance indemnity, the cargo insurer may acquire a right of subrogation against the party responsible for the damage. In such a case, the customer receives compensation under their policy, and the insurance company handles further recovery from the carrier within the limits of the right of subrogation transferred to it.

The specific procedure always depends on the terms of the policy and applicable law.

What Exactly Does a Carrier’s Liability Policy Cover

CMR insurance typically protects the carrier from the financial consequences of its liability to the cargo owner. Such insurance may cover risks of loss, damage, theft, and other events, but only to the extent specified in the contract.

Before handing over the cargo, it is advisable to check:

• the name of the insurance company;
• the policy’s validity period;
• the territory of coverage;
• the list of insured vehicles;
• the insured amount;
• the deductible;
• exclusions;
• restrictions by cargo type;
• coverage for theft and robbery;
• special requirements for parking areas and security;
• coverage for hazardous or high-value goods.

A single page of the insurance certificate does not always provide a clear understanding of the actual terms and conditions. Significant limitations may be found in the insurance rules and appendices to the contract.

When Cargo Insurance Is Especially Necessary

A separate policy is worth considering if:

• the value of the goods significantly exceeds the equivalent of 8.33 SDR per kilogram;
• electronics, pharmaceuticals, or high-value components are being transported;
• the shipment contains unique industrial equipment;
• the cargo is attractive to thieves;
• the route involves multiple transshipments;
• different modes of transport are used;
• the goods are sensitive to temperature, moisture, or physical impact;
• the potential loss of the shipment is critical to the financial stability of the business;
• the contract with the supplier or buyer places the risk on your company.

For the transport of dangerous goods, you must additionally verify whether the insurer accepts the specific product class, UN number, packaging type, and selected route.

The mere presence of high risk does not automatically mean insurance coverage. All product characteristics must be disclosed to the insurer before the policy is issued.

Can the Declared Value Replace Insurance?

Article 24 of the CMR allows the shipper, by agreement with the carrier and for an additional fee, to specify in the bill of lading a value of the cargo that exceeds the standard limit of liability. In this case, the declared value can replace the standard limit.

The CMR also provides for the option to specify a special interest in delivery.

However, these mechanisms cannot be considered a complete substitute for cargo insurance. Declared value:

• must be agreed upon in advance;
• is specified in the transport document;
• may require an additional fee;
• increases liability only within the specified limits;
• does not eliminate the need to establish the carrier’s liability;
• does not guarantee compensation for events for which the carrier is not liable.

Therefore, the choice between declared value and separate insurance must be made before the start of carriage, not after an incident occurs.

When the 8.33 SDR/kg limit may not apply

According to Article 29 of the CMR, the carrier may not invoke provisions limiting its liability if the damage was caused by willful acts or a breach that a court, under applicable law, deems equivalent to willful conduct.

However, this exception does not automatically apply in the event of any serious error on the part of the driver or the carrier. The nature of the breach, the evidence, and the applicable law are assessed on a case-by-case basis. The dispute may require litigation, and the outcome cannot be taken for granted.

It is too risky to plan cargo protection measures on the assumption that Article 29 will ultimately be applicable.

What to Do in the Event of an Incident

If damage, shortages, or signs of tampering are discovered upon receipt, you must:

1. Suspend unloading, if it is safe and possible.
2. Document the condition of the vehicle, seals, packaging, and goods.
3. Take photographs and videos.
4. Make specific notes in the CMR.
5. Prepare a report with the driver and recipient present.
6. Notify the carrier, freight forwarder, and insurer immediately.
7. Do not dispose of the packaging or damaged goods without prior approval.
8. Take reasonable measures to prevent further damage.
9. Retain the invoice, packing list, CMR, and documents proving the value of the goods.
10. If necessary, arrange for an independent cargo survey.

Failure to document damage in a timely manner can significantly complicate the process of obtaining compensation, even if an insurance policy is in place.

How Businesses Can Protect the Value of Their Cargo

Before commencing international truck transport, compare the value of the shipment with the potential liability limit:

Gross weight × 8.33 SDR

If the value of the goods is significantly higher than this result, there is an insurance gap. This gap can be reduced through separate cargo insurance, agreement on the declared value, or other protection provided for in the contract.

When choosing a solution, it is important to verify:

• who bears the risk according to the contract and Incoterms;
• the value at which the goods are insured;
• whether transportation and related expenses are included;
• what risks are covered;
• what the deductible is;
• whether the policy covers the entire route;
• whether intermediate storage and transshipments are included;
• what documents will be required in the event of an insured loss.

Key Points on the Carrier’s Liability

The carrier’s liability is not equal to the value of the cargo. The limit of 8.33 SDR/kg may be sufficient for heavy and relatively inexpensive goods, but it offers virtually no protection to the owner of light, high-value goods.

The carrier’s liability policy covers the carrier’s obligations, while cargo insurance protects the property interests of the cargo owner. These are two different tools that complement, but do not replace, one another.

Prior to shipment, Save Pro Solutions can help verify the shipment’s characteristics, route conditions, the carrier’s documents, and any potential gap between the value of the goods and the liability limit. The final terms of coverage, insured risks, and exclusions are always specified in a separate insurance contract.