LOGISTICS

Liability of the Freight Forwarder: When Is the Forwarder Liable Like a Carrier?

In a large share of transports involving Türkiye, the shipper does not hand over its goods directly to a carrier but to a freight forwarder that organises the transport. The forwarder, in turn, often does not perform the transport with its own vehicles but entrusts it to one or more subcontracted carriers. This structure is practical in day-to-day operations, but when damage or loss occurs it immediately raises the first question: who is the shipper's counterparty, and to what extent is the forwarder liable?

This activity, known in the industry as freight forwarding, is governed by the Turkish Commercial Code as the forwarding contract, and its provisions were drafted largely on the model of German law. The system therefore looks familiar to German and Austrian logistics professionals; however, the standard terms widely used in the German industry do not carry the same weight in Türkiye, and contracts are often drafted without regard to this gap.

The forwarder's basic duties and liability

As a rule, the forwarder undertakes not the transport itself but its arrangement. Selecting the carrier and concluding the contract of carriage are the core of this duty; additional services such as packing, marking, insuring the goods and handling customs formalities fall within the forwarder's duties only if separately agreed. The forwarder must perform these duties with the care expected of a prudent forwarder, and the care exercised in selecting the carrier is particularly relevant in determining its liability.

If the goods are lost or damaged while in the forwarder's custody, for example while held in its warehouse or during transhipment, the forwarder is liable irrespective of fault. Like that of the carrier, this liability is limited to a maximum amount calculated on the basis of the weight of the goods.

When the forwarder is liable like a carrier

In practice, the key question is in which cases the forwarder is held liable not merely as a forwarder but as a carrier itself. Turkish law highlights three situations in this respect.

The first is where the forwarder performs the transport itself; it need not have its own vehicles for this purpose. In this case, the forwarder has the rights and obligations of a carrier with regard to the transport. The second is the agreement of a fixed price that also covers the costs of carriage; in this case, too, the forwarder is considered liable like a carrier with regard to the transport. The third is where the forwarder has goods of different shippers carried together under a contract of carriage concluded on its own account (consolidation); here, too, the forwarder is liable like a carrier for the consolidated part of the transport.

The common consequence of these three situations is that the rights and obligations specific to a carrier apply to the forwarder with regard to the transport; in practice, this means that the forwarder is answerable for the acts of the subcontracted carrier within the framework of carrier liability. In international road transport falling within the scope of the CMR, the forwarder's liability under the provisions of that Convention may also come into question. Experience shows that many forwarders who have quoted a fixed price for a transport but still regard themselves merely as forwarders only discover the extent of their liability in the first damage case.

Standard terms and limitation of liability

In German practice, forwarding relationships are largely governed by established industry standard terms, which also set the limits of liability. In Türkiye, there is no direct equivalent to these terms, and a mere reference to them in the contract is often not sufficient, since general terms and conditions only become part of the contract if they are expressly brought to the other party's attention and that party has the opportunity to learn of their content.

Furthermore, clauses excluding in advance the forwarder's liability for gross fault are invalid, and certain statutory liability provisions can be departed from by contract only to a limited extent. Companies working with a Turkish forwarder or operating as forwarders in Türkiye therefore need to structure their liability limits and insurance arrangements specifically under Turkish law.

Recourse against the subcontracted carrier

A forwarder held liable towards the shipper like a carrier will want to recover the compensation paid from the subcontracted carrier. Whether recourse is effective depends on the contract with the subcontracted carrier and the forwarder's obligations towards its own customer being aligned. In practice, however, it is frequently found that the forwarder has accepted broader liability towards its customer while agreeing to narrower limits in its contract with the subcontracted carrier, with the difference remaining with the forwarder.

Time limits are also important for recourse. While dealing with its customer's claim, the forwarder may overlook the fact that the limitation period against the subcontracted carrier continues to run; it is therefore advisable to notify the subcontracted carrier in writing on the first day of the customer's claim.

Storage and warehousing

Many forwarders provide storage services in addition to transport. Where an independent storage service is concerned, the period during which the goods are in the warehouse is governed not by the rules on carriage but by those on warehousing and deposit contracts, whose liability regime differs from that applying to carriage. By contrast, temporary holding and transhipment as a normal part of the transport generally remain within the carriage regime. For goods stored in customs warehouses, obligations under customs legislation also apply.

Where transport and storage services are governed by the same contract, it must be clearly specified which liability regime applies at which stage and who is to insure the goods during storage.

The forwarder's rights over the goods

A forwarder whose fee has not been paid may exercise a right of retention over the goods in its possession. This right gives the forwarder an effective means of collecting its claim, but creates a risk for the shipper that the goods will be withheld unexpectedly. In particular, whether goods may be retained for claims arising from more than one transaction is frequently disputed in practice.

Conclusion

The forwarder's liability is determined not by the name of the contract but by the role the forwarder has actually assumed. Knowing that a forwarder working at a fixed price, performing the transport itself or organising consolidated transport will be liable like a carrier, restructuring standard terms under Turkish law and aligning the contract with the subcontracted carrier with the liability assumed towards the customer are the basic steps that determine the position of the forwarder and the shipper in damage cases. Carrier liability under the CMR is discussed separately in the first logistics article in this section.