Lecture Marine environmental studies Topic International oil pollution compensation (IOPC) schemes

Inspite of the best pollution prevention efforts, oil pollution occurs, and when it occurs people suffer different types of damages. Those who suffer the damage need to be compensated. The topics discussed in this chapter are: Introduction; international convention on civil liability for oil pollution damage (CLC), 1969; the protocol of 1992; international convention on the establishment of an international fund for compensation for oil pollution damage (Fund), 1971;...

INTERNATIONAL OIL POLLUTION COMPENSATION

(IOPC) SCHEMES

Regional Maritime

University

Introduction

 Inspite of the best pollution prevention efforts, oil pollution occurs, and when it occurs people suffer different types of damages

 Those who suffer the damage need to be

compensated

 The Torrey Canyon incident of March 1967 off the English coast made the world aware of the need for international regimes of liability and compensation for pollution damage caused by oil spills from tankers

 Two conventions were adopted in 1969 and

1971

 International Convention on Civil Liability for Oil Pollution Damage, 1969 ( Civil Liability Convention ) or (CLC 1969)

 International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage

1971 ((FUND CONVENTION OR (FUND 71)

 The FUND convention is supplementary to CLC One can therefore not be a party to the FUND

if the state is not party to the CLC

International Convention on Civil

Liability for Oil Pollution

Damage (CLC), 1969

 The Civil Liability Convention was adopted

to ensure that adequate compensation is available to persons who suffer oil

pollution damage resulting from maritime casualties involving oil-carrying ships.

 The Convention places the liability for

such damage on the owner of the ship

from which the polluting oil escaped or

was discharged.

CLC (continued)

 Subject to a number of specific

exceptions, this liability is strict ;

(operate on the principle of Strict

Liability-ie the shipowner is liable even in the absence of fault)

 it is the duty of the owner to prove in

each case that any of the exceptions

should in fact operate. 

 As a result of war or Grave natural disaster

 Sabotage by a third party (wholly caused by 3rd party)

 Inability of port and coastal

authorities to provide or maintain navigational aids in territorial

waters.

 The Convention requires ships covered

by it to maintain insurance or other

financial security in sums equivalent to the owner's total liability for one incident (related to the tonnage of a vessel).

 The Convention applies to all seagoing vessels actually carrying oil in bulk as cargo, but only ships carrying more than 2,000 tons of oil are required to maintain insurance in respect of oil pollution damage

 This does not apply to warships or other

vessels owned or operated by a State and used for Government non-commercial service

 The Convention, however, applies to ships

owned by a State and used for commercial

purposes

 The Convention covers pollution damage

resulting from spills of persistent oils suffered

in the territory (including the territorial sea) of

a State Party to the Convention

 It is applicable to ships which actually carry oil

in bulk as cargo, i.e generally laden tankers

 Spills from tankers in ballast or bunker spills from ships other than tankers are not covered, nor is it possible to recover costs when

preventive measures are so successful that no actual spill occurs

The Protocol of 1992

 The 1992 protocol widened the scope of the Convention to cover pollution damage caused

in the Exclusive Economic Zone (EEZ) or

equivalent area of a State Party

 The Protocol covers pollution damage as

before but environmental damage

compensation is limited to costs incurred for

reasonable measures to reinstate the

contaminated environment

 It also allows expenses incurred for preventive measures to be recovered even when no spill

of oil occurs, provided there was grave and

imminent threat of pollution damage

CLC 92 (continued)

 The Protocol also extended the

Convention to cover spills from

sea-going vessels constructed or adapted to carry oil in bulk as cargo so that it

applies to both laden and unladen

tankers , including spills of bunker oil

from such ships.

INTERNATIONAL CONVENTION ON THE

ESTABLISHMENT OF AN

INTERNATIONAL FUND FOR COMPENSATION FOR OIL

POLLUTION DAMAGE

(FUND), 1971

Problems with CLC

 it was based on the strict liability of the

shipowner for damage which represented a dramatic departure from traditional

maritime law which based liability on fault. 

 limitation figures adopted were likely to be inadequate in cases of oil pollution damage involving large tankers. 

 They therefore wanted an unlimited level of compensation or a very high limitation

figure.

FUND ‘71

 Aim of relieving the shipowner of the

burden by the requirements of the new convention and, on the other hand,

providing additional compensation to the victims of pollution damage in cases

where compensation under the 1969

Civil Liability Convention was either

inadequate or unobtainable.

 The Fund's obligation to pay compensation is

confined to pollution damage suffered in the

territories including the territorial sea of

Contracting States. 

 The Fund is also obliged to pay compensation in respect of measures taken by a Contracting

State outside its territory.

 The Fund can also provide assistance to

Contracting States which are threatened or

affected by pollution and wish to take measures against it This may take the form of personnel, material, credit facilities or other aid.

FUND

‘71

The Protocol of 1992

 As was the case with the 1992 Protocol

to the CLC Convention, the main purpose

of the Protocol was to modify the entry into force requirements and increase

compensation amounts

 The scope of coverage was extended in line with the 1992 CLC Protocol

DIFFERENCE BETWEEN OLD REGIME (CLC ’69,

FUND ‘71)

&

NEW REGIME (CLC &

FUND 92)

OLD REGIME NEW REGIME

Conventions apply to laden

vessels only

Apply to both laden and

unladen vessels Covers oil pollution only in the

territorial seas

Covers pollution damage up to

the EEZ Compensation for preventative

measures is not given under

the old regime

Compensation can be awarded for preventative measures, provided that a spill was

imminent Compensation under the new regime is significantly higher

than old regime

Difference between old regime and

new Regime

MAXIMUM AMOUNTS OF COMPENSATION AVAILABLE UNDER THE CONVENTIONS

(EXPRESSED IN US$ MILLIONS - rates as at December 2011)