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;...
Regional Maritime University INTERNATIONAL OIL POLLUTION COMPENSATION (IOPC) SCHEMES 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. Exceptions 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 Requirements 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) Application 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 Cover 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 seagoing 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 FUND ‘71 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 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) Difference between old regime and new Regime OLD REGIME NEW REGIME Conventions apply to laden vessels only Apply to both laden and unladen vessels Covers oil pollution only in the Covers pollution damage up to territorial seas the EEZ Compensation for preventative Compensation can be awarded measures is not given under for preventative measures, the old regime provided that a spill was imminent Compensation under the new regime is significantly higher than old regime MAXIMUM AMOUNTS OF COMPENSATION AVAILABLE UNDER THE CONVENTIONS (EXPRESSED IN US$ MILLIONS - rates as at December 2011) ... 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... 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... 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