Preparation time to close an agreement? SLA When is this discussed? What is the basis of the negotiation strategy? Structure 4. Liability 5. Simplified procedure Annex B 6.
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Download file as PDF. The AHM includes the latest iteration of the SGHA, reflecting developments both within aviation and more widely, emerging out of consultation and input from airlines, handling companies and other industry stakeholders.
Many of the changes are merely editorial, amending SGHA However, some amendments are significant and focus on operational practices, improvements in standards, training, insolvency, indemnity claims and compliance generally. We have briefly reviewed the key changes in the Main Agreement and Annex B and considered what they might mean to users.
New clause 3. However, in practice, it is difficult to envisage this happening, unless an airline has sufficient resource such as personnel and ground support equipment , ready to step into the shoes of an incumbent handler.
IATA has expressly referred to its resolutions and standard practices as benchmarks for handling company service delivery, listing them verbatim in new sub-clauses 5.
The training provisions in new clause 5. Of course, carriers will have their own ground operations manual, further service provider policies, codes of conduct, guidelines on approach, customer care such as a customer charter , style and even branding.
Handling companies are often the face of an airline at an airport. Airlines must supply sufficient information to enable handling companies to perform handling properly new clause 5. SGHA has crystallised broader audit rights under clause 5. There are currently 37 airlines in the ISAGO Audit Pool, which can benefit from shared operational audit reports for the same handler at a given airport.
Amended clause 7. Given historical liquidity issues that some airlines have faced, it is perhaps surprising that these clauses have not been previously introduced into the SGHA. It does not mean that handling companies will be anything other than unsecured creditors for unpaid invoices. Depending on the governing law of the SGHA, any prepayments or cash advancements might fall foul of applicable local insolvency regulations.
Carrier insolvency may also have wider implications. They no longer needed ground handling services. Elsewhere, under clause Clause Carriers are now required to notify handlers promptly, should they make an indemnity claim for damage to cargo under clause 8. Failure to do so may invalidate the claim if the handler is materially prejudiced.
There was some confusion in SGHA on the time limit applicable to an indemnity claim by a carrier. Article It does not address claims by a carrier against a ground handler. Others have argued that the carrier itself would also have to seek an indemnity within these time limits.
If so, the wording could have been improved. Also, what is the position with completely lost cargo? It will be interesting to see how indemnity claims are managed and whether internal airline processes to track and monitor cargo claims develop as a result. Improvements may occur if airlines take advantage of more detailed documentation requirements for cargo consignments and irregularity handling in 5. SGHA does not fully address data protection, despite widening the definition of Tickets to cover eTickets.
The original clause 5. Data protection has been added to the compliance checklist under clause 1. Arguably, this change has the effect of elevating data protection to the level of anti-bribery, anti-competition and child labour prohibitions. Furthermore, it is also reasonable to not overload the SGHA with data protection legalese.
However, retaining the original clause 5. The provisions governing travel document checking in section 2. This issue may become more important especially with certain countries having enacted stricter immigration rules and blue passports. Going forward, this will provide some flexibility in the baseline template. In conclusion, SGHA is an effective and useful contractual tool for the industry. However, it is only a baseline. From an operational perspective, one size does not fit all.
The parties should not abandon freedom of contract principles and continue to adapt their contracts to meet their bespoke operational needs. We are working with clients across our international network to help them minimise the impact of COVID on their business and to prepare for what's next. To find out more, visit our dedicated Covid hub. Full profile of Peter Coles peter.
Full profile of Alastair Long alastair. We consider the main changes introduced by SGHA — an industry standard template for airlines and handlers that has been the benchmark for more than 25 years. Self-handling New clause 3. Standards, training and audit pools IATA has expressly referred to its resolutions and standard practices as benchmarks for handling company service delivery, listing them verbatim in new sub-clauses 5.
Pay what you owe Amended clause 7. Indemnity claims Carriers are now required to notify handlers promptly, should they make an indemnity claim for damage to cargo under clause 8. Compliance with data protection SGHA does not fully address data protection, despite widening the definition of Tickets to cover eTickets. Immigration The provisions governing travel document checking in section 2. Concluding comments In conclusion, SGHA is an effective and useful contractual tool for the industry.
Maurizio Interprets the SGHA. Maurizio Anichini