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

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)