Warsaw Convention: Air Transport Cargo Damage Compensation Standards
Published on May 8, 2025
How much compensation can you receive when air cargo is damaged or lost? The Warsaw Convention is the most fundamental compensation standard in the international air transport industry. Today, we provide a detailed explanation of this important international convention.
Background of the Warsaw Convention
The Convention for the Unification of Certain Rules Relating to International Carriage by Air, commonly known as the Warsaw Convention, was signed on October 12, 1929, in Warsaw, Poland, and entered into force on February 13, 1933.
China acceded to the Convention in 1958. It remains the basic legal framework for international air transport compensation.
Convention framework:
- 1929 Warsaw Convention (original version)
- 1955 Hague Protocol (revised version)
- 1999 Montreal Convention (replacement version with higher limits)
Cargo Compensation Standards
Compensation Limits
The Warsaw Convention sets the following compensation limits for air cargo transport:
- Cargo damage/loss: 17 SDR per kilogram (approximately USD 24)
- Passenger baggage: 17 SDR per kilogram
- Passenger injury/death: Separate standards apply
What Is SDR
SDR (Special Drawing Rights) is a reserve asset and unit of account created by the International Monetary Fund (IMF).
- 1 SDR is approximately USD 1.35 (exchange rate fluctuates)
- The People’s Bank of China publishes the SDR to RMB exchange rate daily
- Real-time exchange rates can be checked on the IMF website
Compensation Calculation Example
Case: 500 kg of electronic components shipped by air are damaged during transport.
Compensation amount = 500 kg x 17 SDR x SDR to RMB exchange rate = 500 x 17 x approximately RMB 9.8 = approximately RMB 83,300
Note: Even if the actual value of the goods far exceeds this amount, the carrier’s maximum compensation is calculated according to this limit.
Claim Time Limit Requirements
The Warsaw Convention imposes strict time limits for filing claims:
| Claim Type | Time Limit | Starting Date |
|---|---|---|
| Cargo damage | Within 7 days | Date of receipt of goods |
| Cargo delay | Within 14 days | Date of cargo delivery |
| Statute of limitations for legal action | 2 years | Date of flight arrival |
Important reminder: Failure to raise an objection within the above time limits will be deemed as acceptance that the goods were delivered in good condition, and the right to file a claim will be forfeited.
Carrier Exemption Circumstances
Articles 20-21 of the Warsaw Convention specify circumstances under which the carrier may be exempted from liability:
- Proof that all necessary measures were taken — The carrier proves it exercised reasonable care
- Force majeure — War, armed conflict, etc.
- Inherent defect of the goods — Loss caused by the nature of the goods themselves
- Defective packaging — Improper packaging by the shipper
- Act of war / armed conflict
- Armed interception by public authorities
Montreal Convention Updates
The 1999 Montreal Convention made significant revisions to the Warsaw Convention, raising the compensation limits:
| Item | Warsaw Convention | Montreal Convention |
|---|---|---|
| Cargo compensation | 17 SDR/kg | 22 SDR/kg |
| Claims procedure | Complex | Simplified |
| Jurisdiction | Limited | Expanded |
China is also a contracting state to the Montreal Convention. For newly acceding countries, the Montreal Convention takes precedence.
Practical Recommendations
1. Cargo Insurance
The compensation limit under the Warsaw Convention is far below the actual value of most goods. It is strongly recommended to purchase transport insurance for air cargo.
Insurance compensation vs. Convention compensation:
- Insurance: Compensates based on the actual value of the goods
- Convention: Compensates based on weight x SDR limit
2. Declared Value of Goods
Truthfully declare the value of goods on the Air Waybill (AWB):
- The declared value can serve as a reference for compensation
- However, it does not affect the Convention’s prescribed limits
- A higher declared value may affect freight charges
3. Carefully Inspect Upon Receipt
- Inspect the goods in person upon opening
- If any damage is found, note it immediately on the receipt
- Take photographs as evidence
- File a written objection within 7 days
4. Retain All Documents
- Air Waybill (AWB)
- Commercial invoice
- Packing list
- Photos of the goods
- Photos of damage
- Claim correspondence
Votrich’s Assurance
As a professional international freight forwarder, Votrich:
- Assists clients with arranging air transport insurance
- Provides full support throughout the cargo damage claim process
- Has a professional team handling international transport disputes
- Ensures your rights and interests are maximally protected
Air cargo damage is not frightening — what is frightening is not understanding the rules and forfeiting the compensation you are entitled to. Master the Warsaw Convention and protect your rights.