Nepal revives bill to tighten airlines' liability and insurance obligations

Nepal's government is pushing forward with a long-delayed bill to overhaul the nation's aviation liability and insurance framework. The move signals a renewed effort to bring the country's domestic air travel laws in line with international standards, years after Nepal ratified the Montreal Convention 1999.

The Ministry of Culture, Tourism and Civil Aviation has submitted the draft bill to the Ministry of Law for feedback. Indu Ghimire, a joint secretary at the tourism ministry, confirmed that the draft is under review. "Once the law ministry clears the draft, it will be presented to the Cabinet before being tabled in Parliament," Ghimire stated.

While the Montreal Convention specifically governs international air travel, the proposed legislation seeks to establish clearer responsibilities for airlines in domestic cases of accidents, delays, baggage loss, and flight disruptions. It aims to define passenger rights and carrier obligations, including comprehensive provisions for compensation, cargo liability, and insurance coverage. The ministry had previously sought public feedback on the draft last year, but progress was halted by a government change.

Under the new proposal, domestic airlines could be liable for compensation up to $100,000 in cases of serious injury, disability, or death resulting from an accident during boarding, flight, or disembarkation. This marks a significant increase from the current minimum compensation of $20,000 for passenger death or injury on domestic flights. For comparison, the Montreal Convention sets airline liability at up to $202,500 for international flights, with a two-tier system that allows for unlimited liability in cases of airline negligence.

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Once the law ministry clears the draft, it will be presented to the Cabinet before being tabled in Parliament.