Royal Decree-Law 26/2020, of 7 July, on economic recovery measures to deal with the impact of COVID-19 in the areas of transport and housing

On Wednesday 8 July 2020, Royal Decree Law 26/2020, was published in the Official State Bulletin, with the aim of approving a set of measures required for the purposes of economic recovery in the transport sector and in the field of housing, protecting the health of workers and travellers, guaranteeing the availability of essential goods and services, providing liquidity to companies and reducing administrative burdens.

In this article, we will analyse this regulatory text, focusing on the specific measures arising for the transport service. 

1. AIR TRANSPORT

Articles 2 to 7 include the management measures adopted for air transport. General prevention measures against COVID-19 that companies in the sector must guarantee compliance with, as well as all those that the Autonomous Communities have adopted. 

Operational guidelines have been established from Europe, which are applicable to the entire Spanish territory. The EASA/ECDC Guidelines will be compulsory not only for airport managers but also for companies that carry out their work as auxiliaries at airports: 

– Inform users on the preventive measures and health reasons why they should refrain from accessing the airport, as well as the consequences of detecting a person suspected of having COVID-19 during health checks. 

For its part, the Transport Facilitation Committee will be responsible for coordinating and supervising all the actors who have a role in the application or definition of these measures.

 

2. MARITIME TRANSPORT

Articles 8 to 14 set out the measures taken to revitalise the maritime sector. Firstly, the reasoned reduction of maritime traffic requirements for 2020 at the request of the concessionaire will be permitted, due to the impossibility of compliance (deriving from COVID-19). 

Likewise, the liquid quota of the occupation rate accrued during the financial year 2020 may be reduced, being determined this reduction depending on the decrease in maritime traffic or, failing this, on incomes attributable to the activity, the different types and also depending on the economic and financial situation of the Port Authority. 

With regard to the activity tax, the Port Authorities may (upon request of the taxpayer) leave the lower limit of the annual activity tax quota without effect for the year 2020. In turn, the enforceability of the activity fee established in the authorisation may also be modified. 

As we have already commented in other publications, this Royal Decree confirms that the fees for vessels (between 1 March 2020 and 31 October 2020) may be modified, depending on the reason for the stay in port waters. Likewise, the Port Authorities may grant deferrals of tax debts accrued (between 1 March and 31 October 2020) and not paid.

As a final comment, it should be noted that the provision of human resources at the passenger terminals serving the regular maritime services during the state of alarm, are considered as emergency services for all purposes.

 

3. RAIL TRANSPORT

With regard to Railway Transport, it should be mentioned that RENFE is authorised to arrange credit operations during the 2020 financial year, for the amount of 1 billion euros. 

It is also planned to authorise extraordinary credits to be financed with Public Debt.

 

4. ROAD TRANSPORT

Articles 18 to 30 contain the provisions relating to road transport. Firstly, moratoriums will be granted for the public goods and occasional passenger transported by bus. 

Among other measures, deferrals of payments of instalments on loan, leasing and renting contracts used by self-employed persons and public undertakings for the purchase of buses and public transport vehicles of more than 3.5 tonnes, maximum authorised mass, are accepted. 

With regard to the approval of road transport authorisations, this will be extended, establishing 2021 as an open deadline for approval of transport authorisations that should be endorsed in 2020 and have not been yet. Also, for those authorizations that should be endorsed in 2020 and have done so, the deadline for their next endorsement is extended until 2023. In addition, the opportunity to apply for extraordinary rehabilitation for public transport authorisations invalidated during 2020 is provided due to the inability to certify the requirements for their endorsement. 

Finally, an extension of 3 months is established for those technical inspection certificates of vehicles that expire between 21 June and 31 August. 

The importance of “Rebus Sic Stantibus” clause in a crisis scenario

In times of crisis such as the one Spain is currently facing due to the COVID-19, both personal and commercial circumstances may drastically change without someone or something being able to avoid it; exceptional circumstances during which individuals and companies are prevented from complying with any contractual obligation of any kind they are engaged in. In this scenario, the so-called “rebus sic stantibus” clause becomes important. 

The purpose of this clause is to cope with substantial amendments to conditions that might occur unexpectedly and unpredictably, and that will undoubtedly affect the contracting parties during the validity of the contractual relationship. These amendments, presumably, avert current conditions from those that favoured the contract signing under the agreed terms and make that the fulfilling of obligations and commitments arising from the contract cause extraordinary damages to one of the parties.

The health crisis that we are undergoing might serve us well as an example of substantial amendments to conditions; phenomenon we might observe in the transportation sector (cancellation of maritime line services, cancellation of flights, breach of charter contracts, paralysis of supply chains, suspension of orders, etc.) as well as in many other sectors of industry and commerce, which in general terms have been severely struck since the declaration of the state of alarm. A crisis that has been defined by the World Health Organization (WHO) as an absolutely unpredictable and unavoidable situation.  

In a situation like this, the “rebus sic stantibus” clause might open up possibilites for contract amendments on the basis of articles 7 and 1258 of the Civil Code, among others, in accordance with the requirements of good faith. This clause does not, under any circumstances, have recessive, resolutory or extinctive effects on the contract; the purpose of this clause is to set a framework of renegotiation of conditions of the contract between the parties in order to compensate, to some extent, for the generated imbalance.   

Although the legal regulation does not explicitly recognize this definition, the Spanish jurisprudential doctrine does as it is evidenced by the Judgements delivered by the Supreme Court in the previous national economic crisis. However, this clause does not apply automatically and in order to be able to apply the “rebus sic stantibus” clause, the jurisprudence lays down some essential requirements: 

  • – Extraordinary alteration of circumstances during the validity of the contractual relationship, in contrast to the circumstances existing at the time of the execution of the contract. 
  • A radical change in the obligations assumed by one of the parties that destructs the balance of the services in an exorbitant manner.
  • Everything is produced by the occurrence of absolutely unpredictable circumstances.

As we can observe when analysing the requirements for the application of the clause demanded by the jurisprudence, its historical application has been very restrictive. Nonetheless, the scenario of the economic crisis (for instance, the 2009 crisis) has extended its application since such circumstances may seriously affect the development of contractual relations.

Hence, the Supreme Court in its Judgment No. 214/2019, rec 3204/2016, of the Civil Chamber, First Section, April 5 2019, and in the Judgement No. 455/2019, of 18 July 2019, in order to accept the alleged amendments to contract, stipulates that these modifications must alter the relationship and the provisions of the contract, and must occur in an unpredictable and unavoidable manner. In other words, if the parties have been able to assume expressly or implicitly the risk that something might occur or they had to do so because this risk already existed at the time of executing the contract or it was reasonably predictable, the clause cannot be invoked. Nor can it be invoked in cases where the alteration is within the normal risks of the contract.

Similarly, in its Judgement of the First Civil Chamber No. 156/2020, rec 2400/2017 of, March 6 2020, the Supreme Court stipulates that, in order to be able to apply the clause, the referred contract must have duration equal to or more than one year, must be of a consecutive nature or of deferred execution. In fact, the Court assumes that it is unlikely that, in the case of contracts of less than one year, anything extraordinary and unpredictable, which would create a disproportion between the claims of the contracting parties, might occur. It remains to be seen if this aspect prevails in a situation such as that arising from the COVID-19 crisis. 

In addition to these two criteria, the Supreme Court considers that in order to effectively apply the “rebus sic stantibus” clause, the alleged situation cannot be contemplated or qualified as a habitual, normal or inherent risk or deriving from the contract (Judgement of the SC (Civil) Section 1, S 30-06-2014, rec 2250/2012).

If we analyse the actions of the Spanish Government, we can realize that it is adopting particular measures which seem to be inclined towards the effectiveness of the clause. An example of this is the Royal Decree Law 11/2020, of March 31, which exceptionally authorizes the suspension of electricity, natural gas and oil derivative products invoicing during the period of validity of the State of Alarm. 

As a conclusion in view of this difficult crisis situation that individuals and companies are facing, from AIYON Abogados, we advise to avoid, to the most possible extent, disputes and litigations in a situation that affects us all. Therefore, we recommend to preserve the contractual balance and respect the criteria of equity and good faith that should always underpin the agreements, promoting so the reestablishment of the balance in the relationship. For that reason we advise to foster agreements and negotiations between the affected parties to a contract, who can always count on the expert advice of our team of lawyers in pursuit of a satisfactory conflict resolution.      

Claims Made Clauses

The “claims made” clauses in civil liability insurance contracts are regulated in article 73, paragraph 2, of the Spanish Insurance Contract Law (Law 50/1980 of October 8th). This paragraph contains two subsections that describe two types of temporary delimitation clauses, i.e., claims occurring clauses and claims made clauses.

The first of these clauses circumscribes the coverage of the insurer to the cases in which the damage has occurred during the policy period but claim of the injured party has taken place within a period of time, not less than one year, from the termination of the contract. In other words, these clauses determine that the coverage of the policy is limited to those events that occurred during the term of the contract if the claim can be made in a period of no less than a year from the termination of the insurance contract.

The second would be the one that circumscribes the coverage of the insurer to the cases in which the claim of the injured party is made during the term of the policy provided that, in this case, such coverage extends to incidents that take place during the policy or a retroactive date that cannot be less than one year. Therefore, in this type of clause the claim must be made within the validity of the contract although the fact that gives rise to the responsibility may have occurred previously.

In other words, in a civil liability policy, an error or omission occurred during the term of the policy will remain covered even if its harmful effects are discovered and communicated to the insurance company after the expiration of the policy but within the term agreed upon in the claims made clause (which cannot be less than one year). However, under a claims occurrence clause, losses will only be covered as a result of an error or negligence when they have been claimed to the insurer during the term of the policy, but in such case the error may have taken place at least one year before the entry into force of the policy.

Given that these clauses limit the rights of the insured, their validity is conditional on including an the extended period to make the claim or including a retroactive date, whatever the case may be, and also on their being specially highlighted in the policy and being expressly accepted in writing, as required by Article 3 of the Insurance Contract Law.

Having examined the question of whether the requirements of both subsections must be met cumulatively, the Supreme Court, in judgment No. 185/2019 of March 26, 2019, has determined that it is not necessary for a temporary delimitation clause to simultaneously meet the requirements of both subsections. The Supreme Court has interpreted that each subsection regulates a different type clause, with its own coverage requirements.

INCOTERMS® 2020

What are Incoterms®?

The increase in the volume and complexity of the sales of national and international merchandise has generated a growth in the misunderstandings and litigation that can always arise between the parts of a contract; with greater reason when the two main parts of a contract, seller and buyer, are located in different countries. 

Already in 1936, and in order to facilitate international trade, Incoterms® were born from the hand of the International Chamber of Commerce (ICC). Rules that, applied to a contract of sale, help to define the obligations and responsibilities that each of the parties assumes in the business they jointly undertake. So, the Incoterms® are not a supranational legal rule, but Lex Mercatoria.

When choosing a rule adjusted to our business needs, there are many more aspects that we should take into account. 

Among others:

  • The means of transport to be used to send the goods from the seller’s premises to those of the buyer.
  • The nature of the merchandise that is the object of the sale, as it is not the same, if we have to urgently deliver perishable merchandise, send bulk merchandise on ships or carry out a palletized truck transport, among other cases.
  • The means of payment agreed between the parties. In this case, the situation will be conditioned on having to make the payment by means of documentary credit with banking entities.
  • The buyer’s own wishes. In fact, there is more and more competition between companies so, in many cases, the seller is forced to make the difference from their competitors.
  • The situation of the countries of origin and destination of the merchandise, since it may happen that we are facing countries with protectionist tariff policies or unstable legal situations or policies.

 

Incoterms® 2020

This year the last version of these rules has been finalized, which is born under the name “Incoterms® 2020” and will enter into force on January 1, 2020.

The rules are classified in the different groups that we detail below:

GROUP

INCOTERM®

DESCRIPTION

Group EEXWEx Works.
Group FFCAFree Carrier
FASFree Alongshide Ship
FOBFree on Board
Group CCFRCost and Freight
CIFCost, Insurance and Freight
CPTCarriage Paid to
CIPCarriage and Insurance paid to 
Group DDPUDelivery at Place Unloaded
DAPDelivery at place
DDPDelivery Duty Paid 

 

Among the novelties presented by this new version, the first and probably most striking is the redenomination of the rule DAT (Delivered At Terminal) that now happens to be called DPU (Delivered at Place Unloaded). This change of acronyms is a simple redenomination, since the obligations and functions of both terms remain exactly the same.

The term DPU is classified within the group of multipurpose terms, meaning that it is an Incoterm® suitable for any type of contracted transport (Road, road, air or sea transport), and is the only Incoterm® that provides that the delivery will only be carry out once the merchandise has been unloaded from the means of transport in which it has been transported. The new nomenclature that has been given to this term only evidences the fact that the merchandise will be delivered unloaded, unlike the rest of the Incoterms® in which the merchandise will be made available to the buyer at the port of destination , in the place designated by the parties.

Secondly, we must mention that in this new version of the Incoterms® when applying the Rule FCA (Free Carrier), it gives us the option, only in case that the main international transport contracted is maritime transport, that the buyer request the carrier or maritime carrier to issue a Bill of Lading on behalf of the seller, wherein the clause “on board” is included, which will record that the merchandise has been loaded on board the ship. 

The introduction of this clause in the Bill of Lading or Bill of Lading will facilitate the payment made by means of documentary credit, as mentioned above.

Thirdly, in this new version it is explained precisely which party will be responsible for carrying out customs procedures, assuming the costs and risks of that phase. The responsibility will be assumed by those who are obliged to transport the goods to the designated place of delivery. Also, for the first time, the dispatch of goods in transit is included.

Finally, we want to talk about what we consider to be the most important difference that this new version of the Incoterms® 2020 rules has brought. This are the different coverages for the merchandise insurance, during their international transport under the terms CIP (Carriage and Insurance Paid to) and CIF (Cost, Insurance and Freight).

While in the CIF term the seller will contract in favor of the buyer a transport insurance with a minimum coverage of clause C of the English Institute Cargo Clauses, which does not vary from the previous Incoterms® version 2010, in the CIP term, the seller will contract for the buyer the transport insurance with a maximum coverage according to clause A of the English Institute Cargo Clauses. 

Difference between CIP and CIF that is justified because CIF is commonly used for the maritime transport of bulk goods (raw materials, scrap, minerals, etc.) whose price per kilo is very low. Therefore, if insurance with maximum coverage is demanded, the policy would become more expensive, which would damage the negotiation margin of the sellers with their potential buyers.

In any case, we must not forget that the rules are part of the ancestral business of buying and selling merchandise, and will be subject to the modifications that the parties consider appropriate and determined in their contracts, within the freedom that national and international trade and rules grant them.  

The responsibility of the Logistics Operator

Port operations of goods during its permanence in a port are of utmost importance for the correct development of the subsequent maritime transportation. Indeed, this is one of the most dangerous and sensitive phases for the goods throughout which it might suffer considerable damages if the operations are not performed appropriately and by qualified professionals. 

Attention is particularly drawn to the fact that there had been a poor regulation of this stage of transportation before the new Spanish Shipping Act came into force in 2014. This law, beside considering the common figures of navigation such as shipowners or shippers, also regulates other figures as harbor pilots and port operators. This last figure will be addressed in this article. 

The port operator frequently encompasses diverse nomenclatures (loader, stevedore, etc.) and the fact is that none of them covers in its description all operations that are effectively handled by port operators. In particular, the Spanish Shipping Act in its article 330 regards the operations that are handled by port operators such as: “the operations of loading, unloading, stevedoring activities on board the vessels, as well as those of reception, classification, depositing and storage in docks or harbor warehouses, and those of inter-port transportation”. 

Regarding the Port Handling Contract regulation, this has been constituted by very different norms throughout a very extensive timespan. In fact, the first legal text which attempts to regulate the Port Handling Contract at the level of international regulation is the United Nations Convention on the Liability of Operators of Transport Terminals in International Trade. This Convention provides, in a broad sense, the basis which the subsequent regulation would apply to develop legislation in this field of logistics.    

At national level, this concept was firstly regulated by the Spanish State Ports and Merchant Marine Act, developed currently under the Title VI – Provision of Services, as well as later in the Spanish Shipping Act, norm that regulates the figure of port operator from the article 329 onwards to the article 338. Articles which we strongly recommend reading.  

The mayor problem that might appear is that the law indicates that the Port Operator’s liability is based on the presumption of liability iuris tantum; that is,  there is a reversal of the burden of proof and it is assumed that the Port Operator is liable for possible damages to the goods unless the contrary is proved, as long as there is a protest (remark) of the receiver at the moment of delivery. Therefore, the moment of delivery of the goods and the possible remarks that the receipt which proves the delivery may or may not contain, is a good form of demonstrating whether the goods arrived already damaged from the point of departure or that, if damaged, these might have occurred in a previous stage of the transportation or handling and lashing of the goods.  

In fact, there are several parties which might request port operator’s liability. The principal one, obviously, is the party contracting the services; but there are other parties, as for instance the consignee of the goods, who might initiate a direct action against the port operator even though he did not contract him. 

It is thus evident that port operators will be held liable for damages to cargo and the only exceptions that the norm anticipates are those of force majeure or fortuitous cases, assessing always if all possible means to avert damages or delays have been deployed by the involved professionals. Consequently, in order to be exempt from liability, not only should be there any of the grounds for exception (force majeure or fortuitous case) but the port operator also has to prove that he tried to minimize, by any available means, the damages or delays. 

With regard to possible limitations, the Spanish Shipping Act regulates the limitation of liability for port operators in the articles 334 and 335 placing it at 2DEG/kg (Derecho Especial de Giro), 2,45 Euros/kg approximately. We understand that the legislator decides to apply this specific limitation to preserve a certain kind of agreement with the existing international rules related to Maritime Transport. In fact, the norm establishes that port operators should be granted the same exceptions as those provided for in the Hague-Visby Rules for carriers, with nuances developed in the article 334 of the Spanish Shipping Act.  

Therefore, when port operators receive the goods, they should check its state and issue a receipt, or a proof of delivery, noting down its state when deposited and indicating whether they observe any damage or not. The problem is, however, that the issuance of such receipts, despite its importance, is not a common praxis since it is the port operator who will have to prove that the goods were already damaged when they were delivered, if that was the case. 

The receiver of the goods, on his part, has the obligation to place a claim within 3 and 15 working days, depending on if these damages are visible to the naked eye or not. Once this period is over, the law presumes that the goods were delivered in perfect conditions.  

On the other hand, and in relation to the limitation period to institute proceedings against the Port Operator, as in other cases, it is not unlimited in time. The regulation seeks to avoid passivity and lack of interest of the parties, so it restricts the limit of the actions to be taken against port operators to two (2) years. In particular, the Article 337 of the Spanish Shipping Act, initiates the time period of two years in the moment of delivery of the goods by the responsible operator, or in the event of total loss on the scheduled delivery date: “Claims for damages, loss, or delays in delivery of the goods prescribe two years after their delivery by the responsible operator. In the event of total loss, the time limit shall be counted from the date on which the goods should have been delivered”.     

An interesting point of the article in comparison to international regulations is that it speaks about limitation period and not about non-interruptible time limit. The non-interruptible time limit cannot be interrupted whereas the limitation period can, providing thus for the possibility to extend the period of two years by means of the relevant interruption. 

In short, the figure of Port Operator is susceptible to claims for damages or delays in a transportation phase throughout which the goods might be exposed to high-risk situations. We therefore suggest always paying special attention to the moment of delivery of the goods granting thus an appropriate backing in case the cargo did not arrive in the expected conditions, as well as to the time limits when the damages could have occurred in order to be able to claim or reject claims, depending on who the affected party is.        

 

Cyber disruption in marine

Yesterday, one of our partners, Verónica Meana, took part in a practical conference organized by AON under the title “CYBER DISRUPTION IN MARINE” which was held in AON’s head office in Torre de Iberdrola in Bilbao. The conference was devoted to learning about and to sharing the risks and consequences that cyberattacks constitute in transportation and industry. 

Verónica had the opportunity to share the discussion panel with Max Bobys, Chris Bhatt and Nannette Wong, and in her presentation tackled administrative and civil responsibilities within transportation and logistics in the context of cyber threat, referring in particular to the maritime transportation sector and its agents. 

AIYON Abogados would like to thank AON for the opportunity we were given to participate in this event, which was greatly insightful in terms of better understanding of the new and future risks that the transportation sector is facing, the ways to deal with them and the insurance options available in the market of hull and machinery, civil liability and P&I insurance. 

A competitive but also a secure road transportation

We received a new case in our law firm. Our good clients request that we protect their interests in a case of cargo that was stolen during a road transportation between Spain and Italy, a contract that was agreed under the terms of the CMR Convention (Convention relative au contrat de transport international de Marchandise par Route, Geneva 1956).

Once we were acquainted with the details, we learned that several individuals had impersonated the identity of a Spanish freight forwarding company, as well as that of its manager, with the aim to conclude several business agreements by sending emails directly to potential Spanish shippers and offering them budget-friendly transportation from Italy. To our surprise, this plan involved phone conversations in which the fraudsters used the identity of real people, the issuance of false documents using names of real existing companies, the goods collection by the fraudsters themselves in broad daylight at the concerted warehouses, and many other circumstances fitting into an elaborated thriller.

This is not an isolated case. In fact, theft of goods transported by road by means of diverse subterfuges is a serious and a live issue given its high economic impact in Spain and in the rest of the European Union. This reality was noted by various national and international organizations and associations, and has been echoed by the international association TAPA – Transported Asset Protection Association – which has denounced that the resulting number of thefts of goods in 2018 is the highest ever recorded since its foundation 20 years ago and it continues increasing in 2019. Moreover, they point out that the crimes they record in their system represent only a part of the market reality.

All this requires reflecting on the risky situations and the lack of guarantees arising during road transportation, and particularly in international transportation, due to the current dynamics pursued in contracting and subcontracting, among other circumstances. It is a common practice to subcontract the same road transportation in an unlimited way which brings forth a creation of “a chain of subcontractors” which in many cases affects the quality of the service and in the worst cases goods are damaged or stolen.

It is quite frequently a case that an export/import company decides to contract a road transport and for that contracts a reputable carrier. From this very first contact between the two entities to the ultimate and effective realization of the transportation by a professional carrier a chain of subcontractors of the same transportation might be created, a fact that might be unknown to the shipper. At least, of course, until damages occur, and liability is claimed. And it is that the contracting carrier or the first carrier, due to internal organization or due to the lack of its own fleet, can subcontract the transportation agreed with the loader to another carrier that, at the same time, can choose to subcontract it to a third party and so on until a supply chain is crated, a chain which ends in the moment that the very last and effective carrier concludes the agreed transportation. This effective carrier might be located in the country where the business was originally agreed as well as in any other country. When a transportation contract is developed between the shipper/contracting party and the first carrier, it is common to agree a set of conditions and requirements but, when the realization of the transportation moves away from the sphere of the two parties that initially agreed it and it is forwarded to the subcontracted third parties, the conditions that were agreed originally in many occasions are not respected and consequently quality and guarantees are lost (lack of regulatory certifications and permits, non-compliance with the established hours of rest, lack of a valid transport insurance, lack of an insurance for the cargo, insufficient insurance coverages, etc. ).

In order to control this situation, and in particular the problematics presented here, that is, the continued growth of thefts during transportation, it should be seriously considered to implement greater control of road transportation from the moment of its contracting to its conclusion. This control could comprise of limiting the number of accepted subcontracts or by directly prohibiting them to the first carrier, requiring compliance with the initially agreed guarantees from the subsequent subcontracted carriers, establishing verifications of safety in case of subcontracting unknown carriers or requesting the safety standards in the modes of transport, among other options. We should remember that once damage has occurred the circumstances of each transportation and its agents will be scrutinized by the affected parties and their insurers. The result of this analysis might place the carriers and their insurance companies in a delicate situation if, in case of an intent or a serious negligence, limitations of the carrier’s liability exposed in the CMR Convention or in the Spanish Law 15/2009 Contract of Transportation of Goods cannot be applied.

Nowadays, the struggle between cost and quality is part of the reality of national and international road transportation. From our law firm, we urge that shippers and carriers focus on searching for the right balance when establishing a competitive and, at the same time, secure business framework.

PIRACY, A REALITY IN THE TWENTY-FIRST CENTURY

Piracy in the maritime world is a reality with a history of hundreds of years, being sometimes prosecuted and other times protected by the institutions of the countries present in the different maritime areas around the world. We have been currently witnessing the fact that this phenomenon is still alive and that it is a way of extorting not only companies and individuals, but also governments of those countries that have to address these unlawful actions in the most thorough manner taking always into consideration the vessels’ safety, but above all the welfare of their crews.

Focusing on our own most recent experience, we know that there have been several pirate attacks in waters of the Indian Ocean against Basque fishing vessels, in particular the “Txori Argi” and the “Haizea Lau”, which only demonstrates that, while the pirate attacks at sea do not attract the spotlight of the news worldwide as they used to some years ago, piracy is by no means eradicated. In fact, and talking here on global scale, the incidents associated with this phenomenon far from being diminishing on the contrary have been increasing according to the report of International Maritime Bureau (ICC) which signals that there were 201 incidents of maritime piracy recorded during 2018 compared with the 180 incidents recorded the year before.

These incidents experienced last year, hijackings and kidnappings committed by pirates, whose target were not only cargo and container vessels, including the vessels of the UN organization involved in international aid programs for countries in specific critical situation, but also, to a larger extent, fishing vessels.

Piracy actions that have been recently concentrated on a mayor scale in waters of the Gulf of Guinea, an area that seems to have taken over what happened in the previous years on the Somalia coastline as the recorded incidents dabbled there in 2018 compared with the year before. In fact, waters of Somalia are enjoying a “relative peace”, at least in comparison with the situation in previous years, basically due to two circumstances. On the one hand, the massive deployment of the so-called “Operation Atalanta”, in which Spain is an active participant, and whose main objective is to protect the maritime traffic in the Indian Ocean against the acts of piracy  and, on the other hand, due to the own security measures taken by the vessels, such as the established operating procedures in case of a piracy attack and the presence of private security companies on board. Yet, the navigation close to the Somalian coastline still requires extreme caution on the part of the shipowners and their crews, as demonstrated by what happened with the fishing vessels “Txori Argi” and “Haizea Lau” this year, and which prevents us from excluding Somalia from the areas of risk.

If we look to the future, we can foresee that piracy, as we know it today, will gradually disappear as the navigation of autonomous vessels and vessels piloted by a remote control from a ground base (unmanned vessels) will become a reality on our seas and oceans, developing thus a new way of maritime navigation.

If we focus on this hypothetical scenario, it might be concluded that new cyber pirates could operate from any place around the globe without any need to be on-site and even without need to be a member of an organization, so that military deployments and private security companies on board, which are nowadays common means of deterrence and protection, could not be used as the main guarantors of a nonviolent navigation. The fight against piracy, which will, one way or another, continue being a present and future threat, will have to be adjusted to the scenarios that may evolve, as well as it should be the legal systems of the countries affected by this reality.

Accordingly, it should be noted that if the control system of an unmanned vessel were intercepted from distance by means of technology and for illicit purposes, it is certain that such situation would not fit in with the provisions of the United Nations Convention on the Law of the Sea (Montego Bay) related to piracy, since the convention specifies that such acts should be committed through the intervention of the crew or the passengers of a vessel and directed against another vessel. Furthermore, if we examine the crime of piracy after the amendment introduced by the Organic Law 15/2003 of 25th November, the current Criminal Code requires that a seizure of a vessel be preceded by an act o violence, intimidation or deceit and therefore the above mentioned situation (with no violence, intimidation or deceit due to the use of virtual means) would remain, at least at the beginning, out of the current criminal penalization.

To sum up, in accordance with the current regulation, it could be concluded that the possible future acts of piracy that were mentioned above would not be considered but cyberattacks with the application of the provisions for cybercrime and other common criminal definitions provided for in the Criminal Code in accordance with the particular circumstances of each case (misappropriation, damages, etc.). This is, however, insufficient since the future acts of piracy might involve, beside a cyberattack for specific purposes, an offence against the safety at the sea and navigation, a legal interest that the crime of piracy aims to protect.

Thus, we find it necessary to review the concept of piracy, so that it encompasses other scenarios that are currently not covered, such as cyberattacks against unmanned vessels, and that these cases remain not restricted to the category of computer specific crime and other offences. We, from our law firm as a team of professionals of the sector and due to our experience, consider that it is convenient, from now on, to be aware of the new forms of piracy, which might already be a reality, and hence to adjust the regulation and the strategies to be followed without delay in order to stay ahead and protect adequately vessels and their crews.

Judgement of the Spanish Supreme Court in the “SPANAIR crash case”

The recent Judgement of the Supreme Court (The Civil Chamber) nº 1513/2019, of 17th of May 2019, brings to a close the issue on the assessment of personal injuries in aviation accidents as it states that, in the absence of assessment standards for personal injuries caused in aircraft accidents a compensation based on the existing legal scale for personal injuries caused in motor vehicle accidents is considered more appropriate.

The Judgement of the Supreme Court confirms the criterion of the Province (High) Court of Barcelona regarding the absence of two payable compensations accumulated for the same injury, an objective one and a subjective one. Nonetheless, the Supreme Court, disagreeing with the Province Court, considers that the Regulation nº 785/2004 does not pursue the quantification of damage to the victim nor it establishes the criteria of quantification. Its sole objective is to establish a minimum insurance coverage for a risky operation such as that of an air carrier. This damage should be evaluated in each Member State in accordance with their own criteria for assessment of damage since there are no Community rules that would provide a frame of assessment. This is consistent with the doctrine of case of law of the First Chamber of the Supreme Court that determines that recoverable damage is a damage that was suffered. Yet the judgement points out that the indicative use of the scale for car accidents for the quantification of the compensation of personal injuries does not prevent the application of corrective mechanisms depending on the circumstances involved in the sector of the activity to which this application is related. In case of death of a passenger in an aviation accident, its catastrophic nature and all other surrounding circumstances are such that it is reasonable that the compensation resulting from the application of the scale be increased by an additional percentage, which was set at 50% in this particular case.

Finally, the Supreme Court considered that the payment of interests of the article 20 of the Insurance Contract Act should be applicable to the insurance company of the airline since they were not contemplated as punitive damages but as delay interests, consequence of an action brought by the injured party directly against the insurer of the carrier.

This Judgement, in principle applicable to air transport, establishes criteria that are applicable by analogy to personal injuries in maritime transport.