A USD 100,000 Shipment Disappears Between Istanbul and Frankfurt — Is the Airline Liable for the Full Amount?

Imagine that a Turkish technology company ships a small package containing high-value electronic components from Istanbul to Frankfurt by air.

The package weighs only 10 kilograms.

Its commercial value is USD 100,000.

The goods are handed over to the air carrier, an Air Waybill is issued, the aircraft departs from Istanbul — but the package never reaches the consignee.

The first reaction of the seller will usually be simple:

“The airline lost goods worth USD 100,000, so the airline must pay USD 100,000.”

Under international air cargo law, however, the answer may be dramatically different.

Where the Montreal Convention applies, the liability of an air carrier for the destruction, loss, damage or delay of cargo is generally subject to a weight-based liability limit. Following ICAO’s most recent revision, the cargo liability limit under Article 22(3) increased from 22 Special Drawing Rights — SDRs — to 26 SDRs per kilogram, effective 28 December 2024.

That means that the legal value of a cargo claim may bear surprisingly little relationship to the actual commercial value of the goods.

For a company shipping smartphones, microchips, pharmaceuticals, jewelry, luxury products or other high-value, low-weight goods, this distinction can be worth tens or even hundreds of thousands of dollars.

This is why air cargo law should not be considered only after cargo disappears.

It should be considered before the shipment leaves the warehouse.

1. Why Air Cargo Law Has Become Increasingly Important

Modern international trade depends heavily on air freight.

Aircraft carry products that businesses cannot afford to leave on a vessel for several weeks:

• smartphones and laptops;
• semiconductor components;
• pharmaceuticals;
• vaccines and biological products;
• medical devices;
• automotive spare parts;
• luxury goods;
• jewelry and watches;
• documents;
• urgent industrial components;
• flowers and other perishables;
• e-commerce orders; and
• high-value machinery parts.

The legal problem is obvious.

Air cargo frequently has a very high financial value in comparison with its physical weight.

A 500-kilogram shipment of ordinary industrial material and a 500-kilogram shipment containing highly valuable pharmaceutical products may have completely different commercial values.

Yet the basic liability mechanism under the Montreal Convention is principally based on weight, rather than invoice value.

This creates one of the most important risk-allocation issues in international air freight.

2. The Montreal Convention and International Air Cargo

The principal international instrument governing many cross-border air cargo claims is the Convention for the Unification of Certain Rules for International Carriage by Air of 1999, commonly known as the Montreal Convention 1999 or MC99.

The Convention creates a unified liability system for international carriage of passengers, baggage and cargo by air.

ICAO describes MC99 as establishing a harmonized legal framework for international air cargo claims involving loss, damage and delay. It also facilitates electronic cargo documentation, including electronic air waybills.

Türkiye is a party to the Montreal Convention. According to ICAO’s treaty records, the Convention became effective for Türkiye on 26 March 2011.

Consequently, when cargo is transported internationally to or from Türkiye and the conditions governing the application of the Montreal Convention are satisfied, MC99 may become the principal legal framework for determining the air carrier’s liability.

3. When Does the Montreal Convention Apply?

The Montreal Convention primarily governs international carriage by air.

In simplified terms, this generally means that the place of departure and the place of destination specified in the contract of carriage are located in the territories of different States Parties, or that an agreed stopping place in another country brings the transportation within the Convention’s definition.

For example:

Istanbul → Frankfurt

may constitute international carriage governed by the Convention where the relevant treaty requirements are satisfied.

Likewise:

Shanghai → Istanbul

or

Istanbul → New York

may fall within the Montreal Convention framework.

The Convention is therefore highly relevant to Turkish exporters, importers, manufacturers, online retailers, pharmaceutical companies and freight businesses involved in international air transportation.

For domestic transportation within Türkiye, the analysis is different because MC99 does not itself become applicable merely because transportation takes place by aircraft. However, Article 106 of Turkish Civil Aviation Law No. 2920 provides that in domestic air transportation, where the Turkish Civil Aviation Law contains no applicable provision, Türkiye’s international conventions may apply, followed where necessary by the relevant provisions of Turkish commercial law.

Accordingly, international and Turkish domestic aviation law must be considered together where Türkiye is connected to the shipment.

4. The Air Waybill: One of the Most Important Documents in the Entire Transaction

In commercial aviation, the key transportation document is generally the Air Waybill — AWB.

The Air Waybill performs several important functions.

It identifies matters such as:

• consignor;
• consignee;
• carrier;
• origin;
• destination;
• cargo description;
• number of packages;
• weight;
• applicable freight arrangements; and
• special handling information.

Under Turkish Civil Aviation Law, Article 110 also regulates the air waybill in cargo carriage. Among other information, the document should identify the carrier, consignor, consignee, places of departure and destination, the nature, quantity and weight of the cargo, and — where specially declared — its value.

The Montreal Convention also permits modern electronic documentation, an important feature in today’s digital air-cargo industry. ICAO specifically identifies the Convention’s facilitation of electronic air waybills — e-AWBs — as one of MC99’s significant contributions to global cargo operations.

But the AWB is much more than an operational document.

In a cargo claim, information recorded on the Air Waybill can become critical evidence.

Most importantly, weight can directly determine the maximum amount recoverable from the carrier.

5. When Is an Airline Liable for Lost or Damaged Cargo?

Article 18 of the Montreal Convention contains the central rule concerning cargo damage.

The carrier is liable for damage sustained in the event of:

destruction, loss or damage to cargo

where the event that caused the damage occurred during the carriage by air.

This means that a cargo owner does not necessarily have to prove a traditional negligence case in the same manner as an ordinary tort claim.

The central questions include:

1. Was the cargo delivered to the carrier?
2. Was it lost, destroyed or damaged?
3. Did the relevant event occur during the period legally characterized as carriage by air?
4. Does one of the Convention’s specific exemptions apply?

These questions often become the core of an air-cargo dispute.

6. What Does “During the Carriage by Air” Mean?

This issue can become surprisingly complicated.

Cargo does not spend the entire transport period physically inside an aircraft.

It may spend hours or days:

• inside an airport cargo terminal;
• in cold storage;
• awaiting customs procedures;
• moving between warehouses;
• undergoing security screening;
• being transferred between flights;
• waiting for loading;
• waiting for collection after landing.

Under Article 18, the relevant period broadly concerns the period during which the cargo is in the charge of the carrier.

The Convention also deals with situations where land, sea or inland-waterway carriage is performed outside an airport in connection with an air carriage contract, particularly for loading, delivery or transshipment purposes.

Consequently, determining exactly when and where the damage occurred can become one of the most important evidentiary issues.

For temperature-sensitive pharmaceuticals, for example, the dispute may not be about whether the box arrived.

It may be about whether the product remained between the required temperatures while stored in the carrier’s cargo facility.

7. When Can the Carrier Avoid Liability?

An air carrier is not automatically liable for every problem affecting cargo.

Article 18(2) of the Montreal Convention provides specific grounds upon which the carrier may avoid liability to the extent it proves that the destruction, loss or damage resulted from certain causes.

These include:

• inherent defect, quality or vice of the cargo;
• defective packing performed by a person other than the carrier, its servants or agents;
• an act of war or armed conflict; and
• an act of public authority carried out in connection with the entry, exit or transit of the cargo.

These exceptions are extremely important in commercial practice.

Consider pharmaceuticals.

Suppose that an injectable pharmaceutical product becomes unusable after an international flight.

The carrier may argue that the deterioration resulted from the inherent characteristics of the product.

The shipper may respond that the real cause was the carrier’s failure to maintain the agreed temperature range.

The case may therefore turn on technical evidence including:

• temperature logger data;
• warehouse records;
• loading times;
• aircraft hold temperatures;
• packaging specifications;
• handling instructions; and
• chain-of-custody records.

Air cargo disputes frequently become both legal and highly technical disputes.

8. Defective Packaging Can Transfer the Risk Back to the Shipper

Packaging is particularly important in air freight.

A shipper cannot simply place a fragile electronic device into inadequate packaging and automatically transfer the entire risk to the airline.

If the damage resulted from defective packing performed by someone other than the carrier or its personnel, Article 18 may provide the carrier with a defence.

This makes packaging evidence important.

Following cargo damage, companies should preserve:

• photographs of the packaging before shipment;
• packing specifications;
• manufacturer’s packaging instructions;
• palletization records;
• temperature-control packaging certificates;
• shock indicator information; and
• loading photographs.

For expensive cargo, a photograph taken before dispatch may later become an important piece of evidence in litigation.

9. Delay: What If the Cargo Arrives Too Late?

Cargo does not need to disappear or physically break for substantial damage to occur.

Sometimes the problem is simply that it arrives too late.

Consider:

• an aircraft spare part required to return a grounded aircraft to service;
• flowers intended for a wedding;
• pharmaceuticals with limited shelf life;
• laboratory materials;
• components needed to prevent a factory shutdown; or
• e-commerce products required for a promotional launch.

Article 19 of the Montreal Convention provides that a carrier may be liable for damage occasioned by delay in the carriage by air of passengers, baggage or cargo.

However, the carrier can avoid liability if it proves that it and its servants or agents took all measures that could reasonably be required to avoid the damage, or that taking such measures was impossible.

Accordingly, proving that cargo was delivered late does not necessarily end the legal analysis.

The claimant must establish compensable damage resulting from the delay, while the carrier may rely on the Convention’s delay defence.

10. The Most Important Number in Air Cargo Law: 26 SDR per Kilogram

This is where many commercial cargo owners receive an unpleasant surprise.

Under Article 22(3) of the Montreal Convention, carrier liability for destruction, loss, damage or delay of cargo is generally limited by reference to the weight of the affected cargo.

Following ICAO’s 2024 revision, the limit is:

26 Special Drawing Rights per kilogram

effective from 28 December 2024.

The SDR is an international unit of account defined by the International Monetary Fund rather than a fixed national currency amount.

This makes the cargo’s weight extremely important.

11. A USD 100,000 Package May Produce a Claim of Only 260 SDR

Consider the following example.

A technology business ships:

10 kilograms of semiconductor equipment.

Commercial value:

USD 100,000.

The shipment disappears while in international air carriage.

If the Montreal Convention limitation applies and there has been no special declaration of interest or other arrangement increasing liability, the basic calculation may be:

10 kg × 26 SDR = 260 SDR.

The difference between the actual commercial value of the goods and the Convention liability limit can therefore be extraordinary.

The airline’s liability is not automatically equal to the invoice value merely because the goods were worth USD 100,000.

This is one of the fundamental commercial realities of international air cargo law.

12. Why the Rule Is Especially Dangerous for High-Value, Low-Weight Cargo

Weight-based liability limits create the greatest exposure for products that are:

lightweight but expensive.

Examples include:

• microchips;
• mobile phones;
• luxury watches;
• jewelry;
• diamonds;
• medical devices;
• laboratory materials;
• high-end cameras;
• specialist aerospace components; and
• certain pharmaceuticals.

A ton of inexpensive raw material and a few kilograms of sophisticated electronics may therefore present completely opposite risk profiles.

Businesses shipping high-value goods should never assume that ordinary carrier liability provides adequate insurance for the commercial value of the cargo.

13. The Solution: Special Declaration of Interest in Delivery

The Montreal Convention provides an important mechanism for dealing with high-value cargo.

Under Article 22(3), the ordinary weight-based limit does not apply in the same manner where the consignor makes a special declaration of interest in delivery at destination when the cargo is handed over to the carrier and pays any required supplementary amount.

In that situation, the carrier may be liable up to the declared amount, unless it proves that the declared amount exceeds the consignor’s actual interest in delivery.

This creates an extremely important distinction between:

invoice value

and

declared value for carriage / special declaration of interest.

Simply putting a USD 100,000 commercial invoice inside the shipment documents does not necessarily mean that the carrier has accepted USD 100,000 of liability under Article 22.

The declaration mechanism should be properly completed in accordance with the Convention and the carrier’s applicable procedures.

For high-value cargo, this should be addressed before shipment, not after loss.

14. Can Gross Negligence Break the Cargo Liability Limit?

This is one of the most legally interesting aspects of the Montreal Convention.

For certain passenger-delay and baggage claims, Article 22(5) removes particular liability limits where damage resulted from intentional or reckless conduct committed with knowledge that damage would probably result.

But Article 22(5) expressly refers to paragraphs 1 and 2 of Article 22 — not paragraph 3 governing cargo.

This distinction is crucial.

The Montreal Convention’s cargo limitation was deliberately structured to provide a particularly predictable liability regime.

Accordingly, a cargo claimant should not assume that simply describing the carrier’s conduct as “gross negligence,” “reckless” or “wilful misconduct” will automatically eliminate the Article 22(3) cargo limit.

For commercial cargo, the safer risk-management mechanisms are therefore generally:

• special declaration of interest;
• contractual increase of carrier liability where available; and
• appropriate cargo insurance.

This is particularly important for high-value shipments.

15. Which Weight Is Used When Only Part of the Shipment Is Lost?

Weight calculations can themselves become disputed.

Suppose an Air Waybill covers ten packages with a total weight of 1,000 kilograms, but only one 50-kilogram package is lost.

Does the claimant automatically calculate the limit using the entire 1,000 kilograms?

Not necessarily.

Article 22 contains rules addressing the weight relevant to damaged, lost or delayed cargo.

The calculation generally focuses on the weight of the package or packages concerned.

However, where the loss, damage or delay affecting one package also affects the value of other packages covered by the same Air Waybill, those additional packages may become relevant to determining the applicable weight.

This can make shipment structuring and AWB documentation commercially significant.

16. Pharmaceuticals and Cold-Chain Cargo

Pharmaceutical air freight creates some of the most difficult cargo liability disputes.

Imagine that a Turkish pharmaceutical business imports biological medicine requiring continuous storage between 2°C and 8°C.

The shipment arrives in Istanbul.

The boxes look perfectly normal.

Nothing is broken.

Nothing is missing.

But the temperature logger reveals that the shipment remained at 18°C for several hours during transit.

The medicine can no longer legally or medically be used.

Has the cargo been “damaged”?

Potentially, yes.

Commercial cargo damage does not necessarily require visible physical destruction.

Loss of commercial usability or deterioration may form the basis of a claim where the claimant can establish the necessary legal and factual elements.

The crucial dispute will frequently concern causation.

Where did the temperature excursion occur?

Was the packaging sufficient?

Were the carrier’s handling instructions clear?

Was the product already defective?

Did customs delay cause the temperature excursion?

Was the cargo left on the ramp?

Did the carrier provide the agreed temperature-controlled storage?

This is why pharmaceutical air-freight disputes often require examination of an uninterrupted cold-chain evidence record.

17. Electronics and Lithium Batteries

Electronics create another layer of risk because many devices contain lithium batteries.

Air transportation of dangerous goods is regulated through the international aviation safety framework, including ICAO Annex 18 and the associated Technical Instructions.

ICAO explains that dangerous goods may be prohibited or subject to specific restrictions concerning matters such as packaging, quantities, stowage, proximity to other cargo and the type of flight.

This matters legally because the shipper has its own obligations.

Incorrect classification, inaccurate documentation or improper packaging can create:

• rejection of the cargo;
• delay;
• regulatory consequences;
• safety liabilities; and
• disputes over responsibility for resulting loss.

A cargo claim cannot therefore be analyzed exclusively from the airline’s perspective.

The shipper’s compliance must also be examined.

18. The Shipper Also Has Legal Responsibilities

The Montreal Convention is not a one-way liability system.

The consignor has responsibilities concerning cargo information and documentation.

Customs, police, export-control and other public-law formalities may require particular documents before the cargo can be delivered.

Article 16 of the Convention places responsibility on the consignor to provide the information and documentation necessary to satisfy customs, police and other public authority formalities and can make the consignor responsible for damage arising from missing, insufficient or irregular information, subject to the relevant carrier-fault exception.

Turkish Civil Aviation Law similarly provides under Article 111 that the consignor is responsible for the completeness and accuracy of cargo information and documents and may be required to compensate damage caused by inaccurate information.

This becomes particularly important for:

• pharmaceuticals;
• dangerous goods;
• controlled technology;
• dual-use products;
• lithium batteries;
• chemicals;
• medical products; and
• goods requiring special import/export authorizations.

19. E-Commerce and the “Who Is the Carrier?” Problem

E-commerce has made air cargo liability more complicated.

The seller may believe that it contracted with a courier company.

But the actual journey may involve:

Seller → freight forwarder → ground handler → airline → destination handler → local courier → customer.

If the shipment disappears, the immediate question becomes:

Which party is legally responsible?

The answer depends on the contractual structure.

A freight forwarder may sometimes act merely as an intermediary or agent.

In another transaction, it may contract as principal and assume responsibilities comparable to a contracting carrier.

The Montreal Convention also contains provisions dealing with situations involving a contracting carrier and an actual carrier.

Accordingly, businesses should examine:

• Master Air Waybill — MAWB;
• House Air Waybill — HAWB;
• freight-forwarding agreement;
• airline conditions of carriage;
• logistics contract; and
• subcontracting structure.

Identifying the correct defendant can be just as important as proving that the cargo disappeared.

20. Damaged Cargo Must Be Reported Quickly

One of the most dangerous mistakes in air-cargo disputes is waiting too long before giving notice.

Under Article 31 of the Montreal Convention, where cargo is damaged, the person entitled to delivery must complain to the carrier in writing within the applicable Convention period.

For cargo damage, the complaint must generally be made within 14 days from receipt of the cargo.

For delay, the written complaint must generally be made within 21 days from the date on which the cargo was placed at the consignee’s disposal.

Failure to make the required complaint can seriously prejudice the claim, subject to the Convention’s limited exception involving fraud.

This means a company discovering damaged cargo should not spend several weeks conducting an internal investigation before notifying the airline.

The safer approach is to preserve rights immediately and investigate simultaneously.

21. Never Sign a Clean Delivery Receipt Without Inspecting High-Value Cargo

Practical evidence begins at delivery.

If a consignee receives cargo with:

• crushed packaging;
• torn cartons;
• broken seals;
• water damage;
• temperature alarm;
• missing packages; or
• visible impact damage,

the condition should be recorded immediately.

The consignee should consider obtaining:

• photographs;
• video;
• delivery records;
• warehouse reports;
• damage reports;
• temperature logger data;
• scale records;
• seal numbers;
• surveyor reports; and
• witness information.

For extremely valuable cargo, an independent cargo surveyor may be appropriate.

The first few hours after delivery may determine whether a claim can later be proved.

22. There Is Also a Two-Year Deadline for Court Proceedings

Written notice is not the only time limit.

Article 35 of the Montreal Convention provides an important extinction period.

The right to damages is extinguished if an action is not brought within two years, calculated from:

• the date of arrival at destination;
• the date on which the aircraft ought to have arrived; or
• the date on which the carriage stopped.

The method of calculating the period is determined according to the law of the court hearing the case.

This is an important distinction from an ordinary domestic limitation-period analysis.

A claimant should not assume that a longer limitation period available under general contract or tort law will necessarily preserve an MC99 cargo claim.

23. Can the Claimant Avoid the Montreal Convention by Suing in Tort?

Usually, simply changing the legal label of the claim will not avoid the Convention’s liability framework.

Article 29 provides that an action for damages relating to carriage of passengers, baggage or cargo, whether founded on the Convention, contract, tort or another basis, remains subject to the Convention’s conditions and liability limits where the Convention governs the claim.

Article 29 also excludes punitive, exemplary and other non-compensatory damages under the Convention framework.

Therefore, a claimant cannot ordinarily transform a limited cargo claim into an unlimited claim merely by pleading:

“negligence,”

“breach of contract,”

or

“tort”

instead of relying expressly on the Montreal Convention.

The substantive nature of the claim matters more than its label.

24. Where Can an Air-Cargo Claim Be Filed?

Jurisdiction is another critical issue in cross-border cargo disputes.

An international shipment may involve:

• Turkish consignor;
• German consignee;
• French freight forwarder;
• Turkish airline;
• transfer in Amsterdam; and
• damaged cargo discovered in Frankfurt.

Which court has jurisdiction?

Article 33 of the Montreal Convention provides jurisdictional connecting factors associated with matters including the carrier’s domicile, principal place of business, the relevant place of business through which the contract was made and the place of destination.

The special “fifth jurisdiction” connected with the passenger’s principal and permanent residence relates to passenger death or injury claims and should not simply be transplanted into commercial cargo disputes.

Consequently, jurisdiction should be examined before proceedings are commenced.

25. Cargo Insurance May Be More Important Than Carrier Liability

For high-value cargo, carrier liability and cargo insurance should never be confused.

Carrier liability asks:

“How much is the airline legally required to pay?”

Cargo insurance asks:

“How much of the commercial loss has the shipper or cargo owner insured?”

Those can be entirely different amounts.

Consider again:

10 kg of electronic components
Commercial value: USD 100,000
Basic Montreal liability calculation: 260 SDR

Without appropriate insurance or a special declaration of interest, the uninsured difference may remain with the cargo interest.

This is why companies regularly transporting:

• pharmaceuticals;
• electronics;
• jewelry;
• luxury goods;
• aerospace components; or
• medical equipment

should review cargo insurance and carrier liability together.

Following payment, the cargo insurer may then pursue responsible parties through subrogation, subject to the rights, defences and liability limitations applicable to the underlying carriage.

26. What Should Be Checked Before Shipping Valuable Goods by Air?

For high-value cargo, legal risk management should begin before the aircraft departs.

The parties should examine:

Carrier Identity
Who is the contracting carrier and who will actually transport the cargo?

Air Waybill
Are the weight, package count, cargo description and routing accurate?

Declared Value
Should a special declaration of interest in delivery be made?

Insurance
Does cargo insurance cover the full commercial value and relevant risks?

Packaging
Does the packaging satisfy carrier, manufacturer and regulatory requirements?

Temperature Requirements
For pharmaceuticals and perishables, are handling temperatures expressly documented?

Dangerous Goods
Are batteries, chemicals or regulated materials correctly classified, packed and declared?

Transfer Airports
Will the shipment pass through locations creating cold-chain, security or political risks?

Contractual Liability
Has the carrier agreed to a higher liability limit?

Claims Procedure
Who inside the company is responsible for immediately reporting cargo loss or damage?

A company that answers these questions before shipment is in a fundamentally stronger position than one that first considers them after the cargo disappears.

27. What Should a Turkish Business Do Immediately After Cargo Is Lost or Damaged?

When an international air cargo problem occurs, the first priority should be preservation of evidence and legal rights.

The business should quickly secure the:

• Air Waybill;
• House and Master Air Waybills;
• commercial invoice;
• packing list;
• customs records;
• freight agreement;
• airline conditions of carriage;
• photographs;
• delivery receipt;
• damage report;
• temperature data;
• correspondence;
• warehouse records;
• cargo insurance policy; and
• evidence of the commercial consequences of the loss.

The carrier should then be notified in writing within the applicable Convention period.

Where the amount is significant, the parties should determine immediately:

1. whether the Montreal Convention applies;
2. who qualifies as carrier;
3. when the cargo entered and left carrier custody;
4. where the damage probably occurred;
5. whether Article 18 defences are available;
6. what weight applies to the liability calculation;
7. whether a special declaration was made;
8. whether contractual liability was increased;
9. whether cargo insurance responds;
10. where proceedings may be filed; and
11. when the Article 35 two-year period expires.

Conclusion: The Most Expensive Cargo May Have the Smallest Legal Recovery

Air cargo is built on speed.

A pharmaceutical product can move from Europe to Istanbul in hours.

A Turkish e-commerce company can send goods to another continent overnight.

An aircraft part can cross several countries before a factory or airline would have received the same component by sea.

But legal liability does not necessarily travel at the same speed as commercial value.

Under the Montreal Convention, international air carriers may be liable for the destruction, loss, damage and delay of cargo, subject to the Convention’s conditions and defences.

Yet the most important commercial rule is often the liability limitation.

As of 28 December 2024, the Montreal Convention cargo liability limit is generally 26 SDR per kilogram.

That produces a counter-intuitive result:

The more valuable and lighter the cargo, the greater the potential gap between the actual commercial loss and the carrier’s legal liability.

This is especially significant for:

e-commerce products, electronics, pharmaceuticals, medical equipment, luxury goods, jewelry, semiconductors and aerospace components.

The solution is therefore not simply to ask whether the airline will be liable after cargo is lost.

Businesses should consider, before shipment:

Air Waybill structure + declared value + cargo insurance + packaging + regulatory compliance + carrier conditions + claims procedure.

In international air cargo transactions, one of the most expensive assumptions a business can make is:

“If the airline loses my USD 100,000 shipment, the airline will simply pay me USD 100,000.”

Under the Montreal Convention, that assumption may be completely wrong.

For valuable commercial cargo, legal risk management must therefore begin before the package reaches the airport — not after it disappears somewhere between two airports.