Quarantine Clause for Fresh Food and Livestock Products
Interlink編集部What Is the Quarantine Clause?
The Quarantine Clause is a policy provision that defines the scope of the exclusion or treatment of losses arising from quarantine, sanitary regulations, import restrictions, and other similar actions imposed by public authorities on perishable foodstuffs, livestock products, marine products, frozen and refrigerated foods, and other quarantine-targeted cargo.
However, quarantine or actions taken by public authorities are not always governed solely by a standalone Quarantine Clause.
Depending on the insurance contract, quarantine, import refusals, seizures, attachments, detentions, destruction, return shipments, and other actions by public authorities may be excluded under the basic clauses, automatically attached clauses, special clauses, or individual conditions stated in the insurance policy.
Therefore, it is necessary to review not only the presence or absence of a clause named Quarantine Clause but also the actual insurance policy, including the full text of the basic insurance terms, automatically attached clauses, and special clauses.
Cargo may be detained, refused entry, returned, destroyed, incinerated, or otherwise disposed of due to quarantine or import regulations.
However, losses caused by such administrative actions differ in nature from the physical damage resulting from accidental external perils occurring during ordinary transportation.
This article organizes considerations by separating accidental external perils occurring during transportation, inherent vice or the nature of the cargo, quality or sanitary issues existing before shipment, documentation or permit deficiencies, and actions taken by public authorities—without deciding coverage solely based on the result of quarantine actions.
Scope Covered in This Article
| Item | Content Covered in This Article | Content Covered in Other Articles |
|---|---|---|
| Quarantine Clause | Organizes the scope of the exclusion and treatment of losses arising from quarantine, sanitary regulations, import controls, and actions by public authorities. | The official clause wording and underwriting terms used by individual insurance companies should be confirmed through insurance policies, clause collections, or inquiries to the insurer. |
| ICC(A), ICC(B), and ICC(C) | Organizes the transport risks covered by each condition and treats quarantine-related exclusions and public authority action exclusions as a separate axis of analysis. | The overall structure of each Institute Cargo Clauses, insurance period, war risks, and strikes risks are covered in separate articles. |
| Quality Changes and Natural Deterioration | Clarifies the relationship between inherent vice or the nature of the cargo and the causes of quarantine actions. | Details of quality changes, natural deterioration, inherent vice or the nature of the cargo, and marine cargo insurance are covered in dedicated articles. |
| Pre-Attachment Quality Issues | Clarifies issues such as bacterial contamination, decay, freshness loss, or residual pesticides existing before shipment. | Product liability, quality warranties under sales contracts, and food hygiene responsibilities should be confirmed on a case-by-case basis. |
| Freezer/Refrigerated Cargo Special Clause | Deals with the basic separation when external incidents such as temperature deviations lead to quarantine non-compliance. | The official coverage terms, time requirements, and exclusions of the freezer/refrigerated cargo special clause are handled in separate articles. |
| Reefer Incidents and Temperature Deviations | Organizes causal relationships with quarantine actions for reefer malfunction, power failure, temperature setting errors, etc. | Technical causes of reefer incidents, temperature data analysis, and liability segments are covered in dedicated articles. |
| Document and Permit Deficiencies | Organizes administrative disadvantages caused by deficiencies in sanitary certificates, quarantine certificates, Import Permits, and labeling. | Specific customs and quarantine procedures and permit requirements in each country should be confirmed with customs brokers or local experts. |
| Survey and Evidence Preservation | Organizes documentation to verify the causal relationship between quarantine actions and transport incidents. | Details of sample collection, chain of custody, laboratory analysis, and joint surveys are covered in evidence preservation articles. |
| Freight Forwarder Involvement | Organizes involvement regarding quarantine documents, temperature conditions, transport arrangements, incident notifications, and evidence preservation according to the Standard Five Classifications. | Final compensation liabilities should be judged individually based on the scope of engagement, contract terms, negligence, causality, and liability limitations. |
Why Quarantine Risks Are Difficult to Handle in Marine Cargo Insurance
Marine cargo insurance primarily covers loss or damage to cargo caused by accidental external incidents occurring during the insurance period.
Examples include fire, collision, grounding, seawater exposure, rainwater damage, reefer equipment failure, improper power connection, or temperature deviations during transit.
In contrast, import refusal, detention, destruction, return, or other quarantine measures may be imposed because the cargo does not comply with the destination country's sanitary standards, food safety standards, pesticide residue limits, animal and plant quarantine requirements, import permit conditions, or labeling requirements.
In such cases, even if there is no physical damage to the cargo during transportation, administrative reasons may prevent importation.
Therefore, quarantine-related damages require careful confirmation of the following:
- Whether there has been any physical loss or damage to the cargo itself
- Whether any physical damage was caused by an accidental external incident during transit
- Whether administrative measures were due to quality, sanitary conditions, or regulatory non-compliance of the cargo
- Whether quality or sanitary issues existed prior to shipment
- Whether deficiencies in certificates, permits, labeling, or declarations were the cause
- Whether expenses for destruction, return, storage charges, and re-inspection fees are covered under the insurance
- Whether indirect losses such as unsellability, penalties, or loss of profit are included
Cargo Prone to Issues under the Quarantine Clause
| Cargo | Main Quarantine and Hygiene Risks | Main Quality Risks | Documents to Confirm in Advance |
|---|---|---|---|
| Fresh Vegetables and Fruits | Plant quarantine, pesticide residues, pests and diseases, prohibited imports | Decay, mold, wilting, cold damage | Plant quarantine certificates, pesticide residue inspections, origin and variety information |
| Meat and Livestock Products | Animal quarantine, livestock diseases, sanitation certificates, import facility requirements | Bacterial growth, decay, temperature deviations | Sanitation certificates, processing facility certificates, temperature records |
| Fish and Seafood Products | Hygiene standards, pathogens, harmful substances, origin restrictions | Loss of freshness, thawing, decay, off-odors | Sanitation certificates, catch information, processing records, temperature data |
| Dairy and Egg Products | Animal-derived food regulations, hygiene standards, ingredient regulations | Decay, ingredient changes, temperature damage | Production certificates, ingredient lists, sanitation certificates, temperature records |
| Frozen and Refrigerated Foods | Import hygiene inspections, microbial standards, labeling requirements | Thawing, refreezing, temperature rise, packaging damage | Set temperature, reefer logs, data logger records, quality standards |
| Seeds, Seedlings, and Plants | Plant quarantine, pests and diseases, soil contamination, Import Permit | Drying, reduced germination rate, decay | Plant quarantine certificates, variety information, treatment certificates |
| Wood and Plant-derived Raw Materials | Pests, bark, fumigation, processing conditions | Mold, moisture content, discoloration | Fumigation certificates, processing certificates, moisture content records |
| Food Ingredients and Additives | Ingredient regulations, additive controls, residue substances, labeling | Moisture absorption, deterioration, foreign matter contamination | Ingredient analysis, production records, Import Permit conditions |
| Pharmaceuticals and Bio-related Cargo | Licensing, hygiene and safety regulations, import approvals | Temperature deviations, activity loss, contamination | Permits, stability data, temperature logs, lot information |
Examples of Quarantine or Public Authority Actions
- Detention of cargo during import inspection
- Import refusal due to quarantine failure
- Order for disposal or incineration due to non-compliance with sanitary standards
- Seizure for detection of residual pesticides, hazardous substances, or pathogens
- Destruction or disposal due to animal and plant quarantine requirements
- Customs clearance hold due to lack of certificates, permits, or proper markings
- Refusal of acceptance due to import bans imposed by the destination country
- Orders for re-export or return to the country of origin
- Orders for additional or re-inspection
Such actions may incur not only loss of the cargo’s value but also storage fees, inspection charges, disposal costs, return shipping expenses, re-export costs, and additional customs clearance fees.
However, expenses arising from administrative actions are not necessarily covered to the same extent as physical damage to the cargo itself.
Causes Separation of Quarantine-Related Damage
| Damage Type | Definition / Typical Examples | Perspective in Marine Cargo Insurance | Main Reference Documents | Liability Associations |
|---|---|---|---|---|
| Administrative Actions Due to Quarantine or Import Regulations | Detention, import rejection, destruction, or return due to residue pesticide standards exceeded, pathogen detection, import prohibition or regulatory non-compliance | Separate from accidental external incidents during transit, confirm the Quarantine Clause or the public authority action exclusion. | Notifications from authorities, import rejection notices, inspection results, administrative orders | Responsibility issues arise for exporters, importers, sellers, buyers, and quality controllers. |
| Physical Damage from External Accidents During Transit | Reefer malfunction, power outage, seawater exposure, rain damage, spoilage or contamination caused by impact or container damage | If accidental external incidents during the insurance period can be confirmed, consider insurance coverage for physical damage. | Temperature records, reefer logs, survey reports, container photographs | Liability may lie with the shipping line, warehouse operator, truck carrier, reefer manager, etc. |
| inherent vice or the nature of the cargo | Natural perishable nature of cargo, respiratory heat, moisture content, tendency for microbial growth, ripening or natural deterioration | The exclusion for inherent vice or the nature of the cargo may apply. | Product characteristics, storage conditions, quality standards, expert opinions | Issues concern the suitability between cargo nature and transport conditions. |
| Quality or Sanitary Issues Existing Before Shipment | Pathogens, pesticide residues, rot, contamination, or quality defects present before shipment | Handled as damage occurring before attachment of insurance or pre-shipment quality problems. | Pre-shipment inspections, manufacturing records, lot information, pre-shipment photographs | Quality management by exporters, manufacturers, sellers, or shipment originators is questioned. |
| Documentation or Permit Deficiencies | Deficiencies in sanitary certificates, quarantine certificates, Import Permits, origin or labeling | If no physical damage to the cargo exists, issues may be treated as administrative or contractual. | Certificates, declarations, permit conditions, inquiry records with authorities | Responsibility concerns documentation preparers, exporters, importers, customs brokers or contractors. |
| Physical Damage Occurring During Administrative Actions | Cargo spoilage or deterioration during detention caused by document deficiencies or other reasons | Combine confirmation of detention cause, delay, inherent vice or the nature of the cargo, temperature management, and insurance period. | Detention period, temperature records, authority notifications, storage records | Judgment separates detention cause and management responsibility during storage. |
Practical Verification Types Related to the Quarantine Clause
The verification types in this article are not classifications of the Quarantine Clause established by law or the insurance industry as a whole, but rather an analytical framework to organize causes and verification points related to quarantine-related damages.
| Verification Type | Central Issues | Main Verification Documents | Practical Notes |
|---|---|---|---|
| Verification of Quarantine and Public Authority Actions | Under which laws or administrative decisions are detention, import refusal, seizure, disposal, incineration, or return based? | Authority notifications, disposition orders, reasons for import refusal, inspection results | Check not only the Quarantine Clause but also the public authority action exclusion in the basic clause or automatically attached clauses. |
| Verification of Quality and Hygiene Causes | Are bacteria, spoilage, deterioration, or abnormal odors attributable to inherent vice or the nature of the cargo? | Pre-shipment inspection, quality certificates, microbiological inspection, lot information | Distinguish pre-shipment quality issues, damage before attachment of insurance, and natural deterioration separately. |
| Verification of Documents and Permits | Are there deficiencies in health certificates, quarantine certificates, Import Permits, labeling, or declarations? | Certificates, permits, customs hold notices, declaration records | Do not confuse physical damage to the cargo with administrative disadvantages. |
| Verification of External Accidents During Transport | Are reefer failures, power outages, seawater wetting, or temperature deviations causes of quarantine rejection? | Reefer logs, data loggers, accident reports, survey reports | Separate physical damages caused by external accidents and additional costs arising from quarantine actions. |
| Verification of Costs and Indirect Damages | Do costs for disposal, return, storage fees, inspection fees, sales loss, or lost profits apply? | Cost statements, sales contracts, insurance policies, special clauses | Even if physical damage is compensated, not all costs or indirect damages are necessarily covered. |
ICC(A), ICC(B), ICC(C) and Quarantine Exclusion Are Separate Evaluation Axes
ICC(A), ICC(B), and ICC(C) are basic terms primarily defining which risks during transportation are covered.
In contrast, the Quarantine Clause or the public authority action exclusion constitutes a different evaluation axis, concerning how damage arising from quarantine, Import Permit refusal, detention, or disposal is treated.
| Evaluation Axis | Evaluation Point | Typical Determination | Notes |
|---|---|---|---|
| ICC(A) | Whether accidental external damage to goods occurred during the insurance period | Confirms the possibility of coverage for spoilage, contamination, or temperature damage caused by external accidents. | inherent vice or the nature of the cargo, damage before attachment of insurance, delay, and public authority action exclusions are checked separately. |
| ICC(B) | Whether the cause of damage falls under the listed perils | Confirms physical damage causally related to the listed perils. | Quarantine actions themselves are not automatically covered as listed perils. |
| ICC(C) | Whether the cause of damage falls under limited listed perils | Confirms causality with fire, collision, stranding, etc. | Quarantine actions, Import Permit refusals, or documentary deficiencies are evaluated separately. |
| Quarantine Clause / Public Authority Action Exclusion | Whether damage caused by quarantine, import regulations, or administrative actions is excluded | Confirms actual clause wording, reason for the action, and proximate cause. | Coverage of quarantine actions is not assumed solely because the policy is ICC(A). |
| Costs Clause / Special Clauses | Whether expenses for disposal, return, storage, reinspection, etc. are covered | Confirms type of expense, necessity, insurer approval, and limit amounts. | Physical damage to goods and expense losses are not the same. |
Relation to ICC(A)
ICC(A) generally provides coverage for a broad range of transport risks; however, it does not unconditionally cover damage caused by all possible causes.
When accidental external events during transport—such as reefer equipment failure, power outages, seawater exposure, rainwater exposure, or temperature deviations—result in spoilage, contamination, deterioration, or temperature damage to the cargo itself, it is necessary to confirm the scope of coverage under ICC(A).
On the other hand, bacterial contamination, pesticide residues, freshness deterioration, or quality defects existing before shipment raise issues as damage occurring prior to the attachment of insurance.
Damage caused by the cargo’s natural perishability, respiratory heat, moisture content, or tendency for microbial growth may be treated as loss arising from inherent vice or the nature of the cargo.
Moreover, even if an external accident is established, losses or expenses arising from disposal, return, or detention ordered by quarantine authorities should be separately verified with the Quarantine Clause, the public authority action exclusion, proximate cause provisions, and expense clauses.
Relation to ICC(B) and ICC(C)
Compared to ICC(A), ICC(B) and ICC(C) cover a narrower range of transport risks.
Therefore, it is first necessary to verify whether the physical damage to the cargo is caused by the enumerated risks specified in each condition.
Then, losses arising from administrative actions such as quarantine, import refusal, detention, destruction, or return should be separately confirmed under the Quarantine Clause or the public authority action exclusion.
It is incorrect to assume that the Quarantine Clause automatically applies simply because the policy is ICC(B) or ICC(C), or that ICC(A) broadly covers quarantine-related administrative actions.
The basic insurance terms and the quarantine and public authority action exclusions should be confirmed separately based on the insurance policy and its ancillary clauses.
Damage Separation When External Incidents Occur
Even when an external incident during transport is confirmed, physical damage to the cargo itself and additional losses or expenses arising from quarantine measures should be separately identified.
| Damage / Expense | Examples | Key Points for Insurance | Main Documents |
|---|---|---|---|
| Physical damage caused by external incidents | Spoilage due to reefer power failure, contamination from seawater exposure | Confirm insurance period, accidental nature of the incident, insured risks, proximate cause, and deductibles. | Reefer logs, incident reports, survey reports |
| Loss of cargo value due to quarantine measures | Disposal or incineration by official order | Confirm application of the Quarantine Clause, the public authority action exclusion, and the causal relationship with external incidents. | Disposal orders, quarantine notifications, inspection results |
| Disposal and treatment costs | Incineration fees, disposal contractor charges, attendance fees | Confirm cost provisions, insurer approval, reasonableness, and coverage limits. | Quotations, invoices, approval records |
| Return and re-export expenses | Return to country of origin, re-export to a third country | Check whether additional transport costs are covered or classified as damage prevention expenses. | Return orders, transport quotations, records of insurer discussions |
| Storage and re-inspection expenses | Storage fees during detention, re-inspection charges, analysis costs | Confirm applicable expenses, necessity, period incurred, and any cost deductibles. | Warehouse invoices, inspection invoices, official instructions |
| Unsellable goods and contract losses | Lost sales opportunities, penalty fees, lost profits | Recognize as indirect losses separate from usual physical damage covered by marine cargo insurance. | Sales contracts, loss calculations, customer invoices |
Separating Physical Damage to Cargo from Administrative Disadvantages
| Issue | Practical Understanding | Typical Examples | Main Responsibility Assessment |
|---|---|---|---|
| Physical Damage to Cargo | The cargo itself has experienced spoilage, contamination, temperature damage, seawater exposure, etc. | Spoilage due to reefer failure, food contamination from seawater | Check marine cargo insurance, carrier liability, warehouse keeper liability, etc. |
| Administrative Disadvantages | Even without physical damage to the cargo, customs hold, import refusal, or return orders may be imposed. | Import hold due to errors on sanitary certificates | Determine responsibility of exporter, importer, document preparer, or entrusted party. |
| Expense Losses | Storage fees, inspection fees, return costs, or disposal fees arise due to administrative actions or detention. | Re-inspection fees, long-term storage charges, incineration costs | Check marine cargo insurance expense clauses, sales contracts, and party responsibilities. |
| Contractual Losses | Separate from physical damage, penalties, inability to sell, or loss of profit occur. | Penalties for delivery delays, cancellation of sales contracts | Review sales contract terms, liability for damages, and exclusion of consequential losses. |
| Freight Forwarder Responsibility | Confirm if there were breaches in document verification, communication of terms, temperature arrangements, or accident response during the entrusted operations. | Incorrect communication of set temperature, failure to check entrusted certificates | Verify scope of entrustment, negligence, causation, liability limits, and contract terms. |
Common Practical Problem Cases
| Case | Main Cause | Insurance Points to Confirm | Main Documents to Check | Initial Response |
|---|---|---|---|---|
| Import rejected due to exceeding residual pesticide standards | Non-compliance with destination country food safety standards or pre-shipment quality issues | The Quarantine Clause, the public authority action exclusion, and issues before attachment of insurance | Inspection results, standard values, pre-shipment inspection, import rejection notice | Secure official notices and inspection results, and verify pre-shipment documents for the same lot. |
| Customs clearance delayed due to errors in health certificate | Document deficiencies or non-compliance with import requirements | Presence or absence of physical damage, administrative disadvantage, storage costs, responsibility for document preparation | Health certificate, declaration records, customs clearance hold notification | Confirm details of errors, preparer and verifier identity, and possibility of correction. |
| Bacterial growth confirmed after reefer power interruption | Temperature control failure during transport or storage | Separate physical damage from external accident and damage due to quarantine action | Temperature logs, reefer logs, power connection records, bacterial test results | Preserve temperature data and arrange survey and laboratory analysis. |
| Import disallowed after seawater contamination | Contamination from external accident during transport | Physical damage from seawater exposure, quarantine action, disposal costs relationship | Salt content analysis, wet marks, container photos, quarantine notification | Record condition of cargo and container and preserve samples. |
| Pathogens present before shipment | Pre-shipment quality and hygiene issues | Damage before attachment of insurance, inherent vice or the nature of the cargo | Pre-shipment inspection, manufacturing lot, storage records, inspection reports | Check production and storage history and pre-shipment quality evaluations. |
| Refrigerated cargo spoiled during detention | Detention due to document deficiencies, prolonged storage, temperature management or delay | Cause of detention, timing of physical damage, delay exclusion, management responsibility | Detention notice, temperature records, warehouse logs, spoilage progression records | Verify quality at detention start and temperature control during storage. |
| Pest discovery in plant quarantine resulting in destruction order | Pests, contamination before shipment or invasion during transport | Reason for disposal, cargo condition, external accident, Quarantine Clause | Plant quarantine notice, pest identification results, packing records | Confirm pest type, timing of contamination, and disposal scope. |
| Return shipment due to inadequate labeling and inability to import | Non-compliance with label or marking requirements | Presence or absence of physical damage, return freight cost, document and marking responsibility | Label specifications, import requirements, return order, sales contract | Confirm import eligibility with corrected labeling and options for damage mitigation other than return shipment. |
Standard Five Classifications of Freight Forwarder Involvement
The five classifications used in this article are not established by law or industry-wide consensus. They serve as an analytical framework within this series to clarify the scope of freight forwarder involvement.
| Standard Five Classifications | Main Involvement in Quarantine-Related Operations | Central Point of Responsibility Assessment | Main Documentation |
|---|---|---|---|
| Simple Intermediary | Acts as an intermediary introducing the shipper to the customs broker, inspection agency, insurance company, or local agent. | Whether responsibilities extend beyond simple introduction to include document handling or legality assessment | Introduction records, correspondence emails, quotations |
| Cargo Transportation Service Provider | Assumes cargo transportation services such as temperature control, storage, or international transport. | Contracted transport segment, temperature requirements, external accidents, and contractual transportation obligations | Transport contract, booking, temperature instructions, transport records |
| NVOCC / House B/L Issuer | Engages in international or multimodal transport as the House B/L issuer. | Responsibilities, exclusions, liability limits, and notice periods under the House B/L | House B/L, Master B/L, transport clauses |
| Door-to-Door Single Contractor | Comprehensively undertakes collection, temperature control, export/import arrangements, storage, and delivery. | Scope of comprehensive engagement, subcontracting management, information transmission, and segment of incident | Comprehensive quotation, work specifications, subcontracting records |
| Agent/Coordinator for Specific Operations | Coordinates specific operations such as quarantine document verification, inspection arrangements, temperature control verification, or surveys. | Authorized inspection items, instruction content, and final decision-maker | Delegation records, verification requests, response records, work reports |
Contracting Carrier and Actual Carrier are legal or contractual status concepts and do not replace the Standard Five Classifications used in this article.
Practical operations such as packing, storage, inspection, stowage, vanning, devanning and container inspection do not by themselves constitute a sixth classification.
Example 1: Import Rejection Due to Exceeding Residual Pesticide Standards
Suppose fresh vegetables are exported, and during import inspection in the destination country, the residual pesticide levels are found to exceed the standard limits, resulting in import rejection and an order for return shipment.
No seawater damage, temperature deviation, or container damage was confirmed during transport.
In this case, the primary cause lies in non-compliance with the destination country’s food safety standards or quality and hygiene issues that existed before shipment.
Since this is not physical damage caused by accidental external incidents during transport, it is necessary to review the Quarantine Clause, the public authority action exclusion, issues prior to attachment of insurance, and quality liability under the sale contract.
Costs related to return shipment, storage fees, re-inspection fees, and losses due to inability to sell should also be considered separately from physical loss of cargo value.
This case emphasizes not only the result of quarantine failure but also the importance of confirming when and due to what cause the standard exceedance occurred.
Example 2: Quarantine Failure after Reefer Power Disconnection
During the transport of refrigerated livestock products, suppose the reefer power was disconnected for an extended period at the terminal, causing the cargo temperature to rise significantly above the set temperature.
Upon arrival inspection, the bacterial count exceeded the standard, and the quarantine authority issued a disposal order.
In this case, the external incident of power disconnection may have caused spoilage or bacterial growth in the cargo itself.
First, the causal relationship between the external incident and the physical damage must be confirmed using temperature records, reefer logs, power connection records, and the survey report.
Then, the physical damage to the cargo itself, the quarantine authority’s disposal order, disposal costs, storage charges, and loss of saleability should be separately examined under the ICC, the Quarantine Clause, the public authority action exclusion, and applicable expense provisions.
Even if the external incident is confirmed, it does not necessarily mean all losses and costs arising from the quarantine measures are automatically covered.
Example 3: Prolonged Detention and Spoilage Due to an Error in the Sanitary Certificate
Suppose there is an error in the facility number on the sanitary certificate for refrigerated seafood, resulting in the cargo being detained for an extended period at the destination port.
The cargo was in a marketable condition at the start of the detention, but its quality deteriorated during the correction process, eventually leading to disposal.
In this case, it is important to distinguish between the administrative detention caused by the error on the sanitary certificate and the physical damage to the cargo that occurred during the detention.
It should be confirmed who prepared the certificate, who held the verification obligation, and whether the freight forwarder had accepted responsibility to substantively verify the document’s contents.
At the same time, the management of temperature, storage conditions, damage mitigation measures, insurance period, and any exclusions related to delays during the detention period should be confirmed.
This is a case that requires separating the administrative disadvantage caused by documentation deficiencies from the subsequent physical damage and expenses incurred.
Quarantine Clause Application Confirmation Flow
- Check the full text of the Quarantine Clause attached to the insurance policy.
- Confirm the basic insurance terms, such as ICC(A), ICC(B), or ICC(C).
- Verify whether the basic clause, automatically attached clauses, or special clauses include public authority action exclusions.
- Confirm the type and reason for administrative actions carried out by quarantine authorities or government agencies.
- Confirm whether there is any physical loss, damage, spoilage, contamination, or temperature damage to the cargo itself.
- Check if any external accident occurred during transit.
- Confirm the causal relationship between the external accident and the physical damage to the cargo.
- Verify whether the cause is inherent vice or the nature of the cargo.
- Check if there were any quality or sanitary issues present before shipment.
- Confirm any deficiencies in sanitary certificates, quarantine certificates, Import Permit, labeling, or declarations.
- Distinguish physical damage, administrative action loss, disposal costs, return costs, storage fees, re-inspection costs, and indirect losses.
- Confirm the handling of the insurance period, proximate cause, costs clauses, delay exclusion, and loss prevention expenses.
- Separate and organize marine cargo insurance, sales contract liability, carrier liability, exporter liability, and freight forwarder liability.
- Consult with the insurance company, insurance agent, surveyor, testing and analysis agency, and maritime lawyer as necessary.
Judgment Checklist for Freight Forwarder Practice
| Confirmation Situation | Party to Confirm With | Items to Confirm | Actions If Issues Arise |
|---|---|---|---|
| At Acceptance | Shipper, Exporter, Importer | Whether the cargo is fresh food, livestock products, marine products, animal or plant-derived goods, or subject to quarantine | Do not treat as ordinary cargo; prompt confirmation of quarantine, hygiene, and temperature control conditions. |
| At Import Condition Check | Shipper, Importer, Customs Broker, Local Agent | Import eligibility, quarantine conditions, Import Permit, and food hygiene regulations | Clarify the entity responsible for confirming destination country regulations and the final decision-maker. |
| At Document Check | Shipper, Exporter, Customs Broker, Inspection Agency | Sanitary certificate, quarantine certificate, certificate of origin, inspection report | If there are deficiencies or discrepancies, encourage correction or additional arrangements before shipment. |
| At Temperature Control Confirmation | Shipper, Shipping Line, Airline, Warehouse Operator, Trucking Company | Set temperature, allowable range, reefer arrangement, data logger | Ensure accurate reflection of temperature conditions in booking and work instructions. |
| At Insurance Check | Shipper, Insurance Company, Insurance Agent | Quarantine Clause, public authority action exclusion, frozen/refrigerated cargo conditions, temperature deviation coverage | Avoid misunderstandings that quarantine risks are automatically covered; confirm the official clause wording. |
| When Quarantine Failure Occurs | Importer, Customs Broker, Quarantine Authorities, Insurance Company | Reasons for failure, administrative measures, reinspection, disposal or return instructions | Secure early notification from authorities, inspection results, and cargo condition. |
| When Transport Accident Is Suspected | Insurance Company, Shipping Line, Warehouse Operator, Surveyor | Reefer malfunction, temperature deviation, seawater exposure, rainwater exposure | Secure temperature data, incident records, and survey documents. |
| At Testing and Analysis | Testing Laboratory, Surveyor, Insurance Company | Inspection method, sample collection, control samples, Chain of Custody | Confirm sample representativeness and management procedures before analysis. |
| Before Disposal | Shipper, Importer, Insurance Company, Authorities | Disposal, incineration, return, reprocessing, and residual value | Except in emergencies, secure photos, samples, quotations, and approvals before disposal. |
| At Expense Responsibility Confirmation | Shipper, Importer, Insurance Company, Maritime Lawyer | Return costs, disposal fees, storage charges, reinspection fees, indemnity claims | Separate and organize marine cargo insurance, sales contracts, and liability clearly. |
Evidence to Verify in Case of an Incident
| Document Category | Main Documents | Purpose of Verification | Points of Caution |
|---|---|---|---|
| Insurance-related Documents | Insurance policy, policy schedule, ICC, Quarantine Clause, automatically attached clauses, special clauses | To confirm basic coverage, exclusions, insurance period, and cost provisions. | Confirm not only the clause names but also the full text. |
| Quarantine and Administrative Action Documents | Authorities’ notices, import refusal notices, detention notices, disposal orders, return orders | To verify the legal basis, reasons, and scope of the administrative actions. | Secure official documents in addition to oral explanations. |
| Inspection and Analysis Documents | Pesticide residue tests, bacterial tests, composition analysis, salinity analysis, reinspection results | To confirm reasons for non-compliance, contamination causes, and quality status. | Check sampling location, testing methods, detection limits, and control samples. |
| Export and Import Documents | Sanitary certificates, quarantine certificates, certificates of origin, Import Permits, B/L, invoices | To verify document or permit deficiencies and the responsible parties. | Secure final versions, revised editions, and transmission records. |
| Quality Documents | Manufacturing date, processing date, lot number, pre-shipment inspections, quality certificates, storage standards | To distinguish pre-shipment quality issues from damage incurred during transit. | Also compare with other cargo from the same lot. |
| Temperature and Transport Documents | Reefer logs, data logger records, temperature settings, power connection records, transport history | To identify timing, extent, and responsible transport segments of temperature deviations. | Preserve original data; do not rely solely on edited materials. |
| Cargo and Container Documents | Cargo photos, packaging photos, container photos, seal numbers, EIR | To verify moisture, damage, contamination, leakage, or container anomalies. | Take photos before movement, cleaning, or return. |
| Survey Documents | Survey reports, Joint Survey records, sample collection records | To third-party verify damage condition, cause, and responsible segments. | Confirm notifications for attendance to involved parties and sample management. |
| Cost Documents | Storage fees, inspection fees, return costs, disposal costs, reprocessing cost details | To verify types, necessity, reasonableness, and amounts of costs. | Separate physical damage amounts from expense losses. |
| Communication and Contract Documents | Sales contracts, Incoterms, bookings, operation instructions, emails | To confirm each party’s scope of responsibility, instructions, and cost burdens. | Differ between explanations created post-incident and records prior to the incident. |
Items to Confirm with the Insurance Company or Insurance Agent
- Whether the Quarantine Clause is included
- The official full text of the Quarantine Clause
- Whether the basic clause or automatically attached clause includes a public authority action exclusion
- Applicable conditions for ICC(A), ICC(B), or ICC(C)
- Special clauses for refrigerated or frozen cargo or temperature control conditions
- Handling of deterioration, contamination, or temperature damage caused by external accidents
- The relationship between disposal or return due to quarantine measures and physical damage
- Handling of disposal costs, return costs, storage fees, and reinspection fees
- Applicability of expense clauses such as damage prevention costs, salvage expenses, or particular charges
- Requirements for approval before disposal, survey, and sample collection
- Handling of residual value, reprocessing, resale, or re-export to other countries
- Management of accident notification, formal claims, and limitation or litigation deadlines
Situations Where a Maritime Lawyer Should Be Engaged
- When there is a dispute over the interpretation of the Quarantine Clause or the public authority action exclusion
- When there is disagreement on whether an external accident or quarantine action is the proximate cause
- When the scope of losses from disposal, return, or detention versus physical damage is contested
- When claims under quality liability in the sales contract compete with marine cargo insurance claims
- When disputes arise over pre-shipment quality issues or damage occurring before attachment of insurance
- When pursuing recourse against the carrier, warehouse operator, or reefer manager
- When responsibility for issuing or verifying health certificates or quarantine certificates is contested
- When high-value claims are filed against freight forwarders or NVOCCs
- When joint surveys, sample collection, or evidence destruction become issues
- When notification deadlines, formal claim deadlines, statutes of limitation, or filing deadlines are approaching
- When multiple countries’ laws, quarantine regulations, or court jurisdictions are involved
Distinguishing Between Marine Cargo Insurance and Freight Forwarder Liability
In incidents involving quarantine measures, whether marine cargo insurance covers the loss and whether the freight forwarder or NVOCC is liable to the shipper are determined by separate criteria.
For marine cargo insurance, it is necessary to confirm whether accidental physical damage occurred to the insured cargo during the insurance period, whether the Quarantine Clause or the public authority action exclusion applies, or whether the cause was inherent vice or the nature of the cargo.
Regarding freight forwarder liability, it should be confirmed whether the forwarder was entrusted with verifying quarantine conditions or import feasibility, whether they were responsible for preparing or substantively verifying necessary documents, whether temperature conditions were accurately communicated, and whether transportation and storage arrangements were properly handled.
Additionally, if post-incident notification, survey arrangements, preservation of temperature data, confirmations or sample preservation before container return are neglected, thereby complicating marine cargo insurance claims or recourse against the carrier, separate liability issues may arise.
A mere failure to pass quarantine does not automatically trigger marine cargo insurance coverage nor does it immediately impose liability on the freight forwarder.
Common Misunderstandings
| Misunderstanding | Actual Concept | Practical Notes |
|---|---|---|
| The Quarantine Clause is always a separate special clause. | It may be included in base clauses, automatically attached clauses, or individual conditions as a public authority action exclusion. | Check the insurance policy and the full text of all attached clauses, not just the clause name. |
| If cargo is stopped due to quarantine, it is compensated as a transport accident. | It may be an administrative action due to legal compliance, quality, or documentation issues. | Verify the reason for the administrative action and whether there was any external accident during transit. |
| ICC(A) broadly covers quarantine measures. | Even with ICC(A), the Quarantine Clause, the public authority action exclusion, and inherent vice or the nature of the cargo require separate confirmation. | Assess basic coverage and quarantine exclusions on separate bases. |
| The Quarantine Clause is only a concern with ICC(B) or ICC(C). | Quarantine-related exclusions and public authority action exclusions may arise even under ICC(A). | Confirm the official clause regardless of the applicable ICC clause. |
| If there is an external accident, all quarantine-related costs are covered. | Physical damage, disposal costs, return freight, storage charges, and consequential losses are assessed separately. | Check expense provisions, approvals, proximate causes, and coverage limits. |
| If cargo is disposed of under quarantine, it is a total loss. | If the disposal reason is an excluded cause, compensation does not necessarily apply even if the cargo is lost. | Review the disposal order, inspection results, and clause wording. |
| Bacteria or spoilage always indicate inherent vice or the nature of the cargo. | There may be external causes such as reefer failure, power outage, or seawater exposure. | Confirm pre-shipment quality, temperature data, and external accidents. |
| Pre-shipment quality issues and inherent vice or the nature of the cargo are the same. | Pre-shipment quality issues relate to timing, whereas inherent vice or the nature of the cargo concerns causation. | Distinguish attachment of insurance, pre-shipment inspection, and cargo characteristics. |
| Import rejection due to certificate deficiencies is physical damage to the cargo. | Administrative disadvantages may occur even if the cargo is intact. | Separate physical damage, expenses, and contractual losses. |
| Documentation deficiencies always mean the freight forwarder is responsible. | Responsibility varies depending on who prepared or verified the documents. | Confirm quotation terms, scope of mandate, and communication records. |
| Quarantine requirements are only the importer’s concern. | The exporter, shipper, manufacturer, customs broker, and freight forwarder’s scope of engagement are also important. | Check the contractual obligations of each party. |
| Notifying the accident also suspends the claim deadline. | Accident notification, formal claim, statute of limitations, and filing deadlines are managed separately. | Verify insurance clauses, B/L terms, and applicable legal deadlines. |
Practical Points
- The Quarantine Clause is a clause that defines the scope of the exclusion or treatment related to quarantine or measures enforced by public authorities.
- Quarantine-related exclusions and public authority action exclusions may be included in the basic clause or automatically attached clauses.
- Check not only the title of the Quarantine Clause but also the full text of the actual clause.
- Confirm coverage for transport risks under ICC(A), ICC(B), and ICC(C) separately from quarantine-related exclusions and public authority action exclusions.
- Separate quarantine actions, external accidents, inherent vice or the nature of the cargo, and pre-shipment quality issues.
- Pre-shipment quality issues occur before the attachment of insurance and are not the same as inherent vice or the nature of the cargo.
- Even if an external accident is confirmed, not all losses or expenses due to quarantine actions are necessarily covered.
- Differ between physical damage, administrative disadvantages, expense losses, and contractual losses.
- Physical damage to cargo may not occur even if there is a deficiency in the required certificates.
- Preserve temperature records, reefer logs, data logger records, and pre-shipment inspection reports.
- Confirm with the insurance company, surveyor, and relevant authorities before disposal or return of the cargo.
- Do not confuse claims under marine cargo insurance with sales liability, carrier liability, exporter liability, or freight forwarder liability.
Summary
The Quarantine Clause is a clause that defines the scope of the exclusion or treatment of loss arising from quarantine, sanitary regulations, import restrictions, and other actions by public authorities concerning perishable food products, livestock, marine products, frozen/refrigerated foods, and other quarantine-controlled cargo.
However, quarantine or actions by public authorities are not always excluded solely under a separate Quarantine Clause.
Basic clauses, automatically attached clauses, special clauses, or individual conditions on the insurance policy may include public authority action exclusions.
Therefore, in practice, it is necessary to check not only the presence of a Clause named Quarantine Clause but also the full text of the actual insurance policy and attached clauses.
ICC(A), ICC(B), and ICC(C) mainly define insured risks during transit, and they represent a different consideration axis from quarantine-related exclusions and public authority action exclusions.
Even if physical loss or damage from an external accident may be covered under ICC(A), losses and expenses resulting from disposal, return, detention, or other official actions by quarantine authorities are not necessarily covered as a matter of course.
When an external accident is confirmed, it is important to separately verify damage to the cargo itself such as spoilage, contamination, or temperature damage, and costs related to disposal, returns, storage fees, reinspection costs, and losses from unsaleability.
It is also important not to confuse inherent vice or the nature of the cargo, quality or sanitary issues that existed before shipment, and damage occurring prior to the attachment of insurance.
Customs clearance holds or import refusals due to deficiencies in health certificates, quarantine certificates, Import Permits, or labeling may occur even when no physical loss or damage has occurred to the cargo.
In such cases, it is necessary to separately organize physical damage to the cargo, administrative disadvantages, expense losses, contractual losses, and the freight forwarder’s entrusted liability.
Upon the occurrence of an incident, promptly securing the quarantine authority’s notices, inspection results, pre-shipment quality documents, temperature records, reefer logs, survey reports, and records of document preparation and submission is advisable.
Final insurance applicability will be individually determined by the insurance company based on the insurance policy, basic insurance conditions, Quarantine Clause, public authority action exclusions, cause of the incident, insurance period, proximate cause, and evidence documents.
