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Enhanced liability clauses in logistics contracts: functions, features and future
University of Borås, School of Engineering. (Logistik)
(Logistik)
2014 (English)Conference paper, (Refereed)
Abstract [en]

This paper provides a detailed analysis and assessment of the use of enhanced liability (EL) clauses in logistics contracts. The expression “enhanced liability” refers to clauses in a contract that obligate one of the partners to accept extended liability for future claims payments beyond normal standards of transport law, conventions or national standard terms. This paper provides explanations and an understanding of how logistics business actors are using enhanced liability clauses in supplier contacts to reallocate their own supply chain risks. The research approach is based on two pillars: firstly, a proposition on EL cause and effects is theoretically deducted from supply chain risk, freight transport and law literature; secondly, the results of 12 semi-structured interviews with managers were elaborated on. The interviews were structured in four major areas: history of EL, contractual negotiation process, effects of activated EL clauses, and future of EL clauses. Enhanced liability clauses are a risk redistribution tool within the supply chain that contributes to higher total cost for the entire supply chain. This paper introduces and discusses the enhanced liability clause in contracts as a risk allocation method and explains its limitations, providing both novel managerial insight and theory.

Place, publisher, year, edition, pages
WHU – Otto Beisheim School of Management , 2014.
Keyword [en]
Risk management, Supply chain risk, Enhanced Liability, Freight forwarding, Logistics business strategy, logistik
National Category
Business Administration
Identifiers
URN: urn:nbn:se:hb:diva-7179Local ID: 2320/13713OAI: oai:DiVA.org:hb-7179DiVA: diva2:887887
Conference
European Research Seminar, Dusseldorf
Available from: 2015-12-22 Created: 2015-12-22 Last updated: 2016-11-18Bibliographically approved

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