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The classic freight forwarder pursuant to Sec. 407 Austrian Companies Act (UGB) in Austria, differentiating a freight forwarding contract from a contract of carriage

Any party who takes on the task of attending to the shipping of goods by carriers or shippers of ocean-going vessels on account of another (the consignor) in its own name. The primary obligation of the freight forwarder is therefore to attend to (organise) the shipping of goods. Unlike the carrier, the freight forwarder itself is under no obligation to transport the goods, but is obliged to plan the transportation, as well as conclude the transactions to be executed in order to have the goods transported. Attending to the shipping of goods includes, inter alia, planning the suitable transport route and the suitable cerries. Should the obligation to ship goods not exist, no freight forwarding contract exists.

The freight forwarder concludes any transactions to be executed in its own name, but on account of its principal (the consignor).

The subject of the freight forwarding contract is to attend to the shipping of goods, namely moveable physical items. The term is to be broadly construed, and thus covers anything that can actually be transported.

As simple as the statutory definition of the difference between a freight forwarding contract and a contract of carriage is, because the freight forwarder - unlike the carrier - is commissioned only with the planning and organisation of the transport operation, but not with its execution, it is, in practice often difficult to differentiate between the two. This is firstly because freight forwarders often take on tasks which may be the preserve of another type of contract.

In line with the general principles of the interpretation of contracts, the differentiation needs to be made in accordance with the recognisable intent of the contracting parties (Sec. 914 Austrian Civil Code (ABGB)).

The following circumstances usually indicate the existence of a freight forwarding contract: Use of the designation “freight forwarding contract” or “shipping order”, being commissioned with “shipping” and the use of typical “freight forwarding documents”.

Criteria that indicate the existence of a contract of carriage would, accordingly, be the designation “freight order” or “loading order”, the issuing of a consignment note and “entering the freight forwarder as a freight carrier", or if “carriage” or “transport” is agreed between the parties.

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Law Articles - Differentiating a freight forwarding contract from a contract of carriage