While the Montreal Convention 1999 (MC99) officially came into force in Nepal on Saturday with nearly eight-fold increase in compensation for airline passenger death involving international flights, clarity on whether the same provisions would apply to domestic carriage within Nepal has been awaited.

The MC99 does not impose any obligations in relation to domestic air travel. 

Government officials said they were “informally” discussing on a separate law for domestic airlines to reflect the principles of the Montreal Convention. 

They said that the Montreal Convention would not be enforced on domestic carriage, but said that the compensation amount would be at least half of the MC99. 

Nepali domestic airlines have been opposing the government’s move to fix a uniform liability amount equal to international airlines. 

The MC99 imposes a strict liability on airlines in three cases: accidental death or bodily injury of a passenger while on board, embarking, or disembarking the aircraft, damage to cargo and damage resulting from delay of passengers, baggage, or cargo.  

The new law has stipulated a nearly eight-fold increase in compensation for airline passenger death involving international flights to $158,565. This works out to approximately Rs 18.23 million at the current exchange rate ($1=Rs115). 

But for domestic carriage within Nepal, the minimum liability is $20,000. 

“We are discussing on the compensation amount for domestic airlines. We will soon reach a conclusion on what amount is justifiable,” said Buddhi Sagar Lamichhane, joint secretary at the Tourism and Civil Aviation Ministry. 

He said that while the compensation amount would not be equal as prescribed by the MC99, the government plans to increase it substantially. 

“We have not proposed an amount for the domestic sector but we think $75,000 to $80,000 will be justifiable,” Lamichhane said, adding that initially, the airfare would increase but there would be practical benefits for passengers in the long run. “It will also boost traveller confidence.”

As the MC99 does not govern the domestic sector, the government needs to enact a separate law to reflect the principles of the Montreal Convention. “We will also discuss if we will need to enact a separate law or draft a rule only,” said Lamichhane.

Government officials had submitted their ratification instrument to the International Civil Aviation Organisation (ICAO) in Montreal, Canada on October 16, becoming the 135th member to ratify the convention. It officially came into force after 60 days. On August 23, Parliament ratified the Convention for the Unification of Certain Rules for International Carriage by Air, also known as MC99. The treaty had been gathering dust at the Ministry since being passed by the Civil Aviation Authority in 2010. 

It took the crash of US-Bangla Airlines Flight BS211 in Kathmandu last March and subsequent public outcry over the outdated compensation system to goad officials into action.

2017 remained a bumper year for domestic airlines, as they recorded 39.47 percent jump in domestic air passenger movement following addition of new aircraft to cater to the growing number of air travellers.

Domestic airline companies saw movement of a record 2.45 million passengers in 2017, according to Tribhuvan International Airport (TIA). The strong passenger growth continued as the country’s domestic passenger traffic grew 16.49 percent to 1.98 million in the January-September period of this year.