Merchant Shipping (Amendment) Bill 2015 for amending the Merchant Shipping Act, 1958

The Union Cabinet, chaired by Prime Minister Shri Narendra Modi, today approved the Ministry of Shipping’s proposal for India’s accession to the International Convention on Civil Liability for Bunker Oil Pollution Damage, 2001 (Bunker Convention) of the International Maritime Organization [IMO] as well as to amend the Merchant Shipping Act, 1958 to give effect to the Bunker Convention, Nairobi Convention and Salvage Convention. The Bunker Convention ensures adequate, prompt, and effective compensation for damage caused by spills of oil, when carried as fuel in ships’ bunkers. The territorial jurisdiction for damage compensation extends to territorial sea and exclusive economic zones. It applies to an Indian vessel, wherever it is situated, and to a foreign flag vessel while it is within Indian jurisdiction. The registered owner of every vessel has to maintain compulsory insurance cover which allows claim for compensation for pollution damage to be brought directly against an insurer. Every ship above one thousand gross tonnage has to carry a certificate on board to the effect that it maintains insurance or other financial security, such as the guarantee of a bank or similar financial institution. In India the Directorate General of Shipping shall issue that certificate and in foreign countries their respective maritime authority will issue the certificate. No vessel will be permitted to enter or leave India without such a certificate. The liability cover for pollution damage shall be equal to the limits of liability under the applicable national or international limitation regime, but in all cases, not exceeding an amount calculated in accordance with the Convention on Limitation of Liability for Maritime Claims, 1976. India is a party to Limitation of Liability for Maritime Claims convention and its provisions already exist in the Merchant Shipping Act and Rules thereunder. The Bunker Convention 2001 is already in force internationally since 21.11.2008 and maritime nations accounting for 91 percent of world shipping tonnage are Parties to this Convention. If India does not become a party to Bunker Convention, Indian flag ships visiting foreign ports will have to continue with the present dispensation of approaching foreign countries for bunker insurance compliance certificates while foreign ships visiting Indian ports are not subjected to compulsory insurance. The proposed amendments to the Merchant Shipping Act 1958, if enacted, shall also give effect to the Nairobi Wreck Removal Convention and the Salvage Convention of IMO to which India is already a party. It will facilitate more purposeful approach towards removal of wrecks and salvage, protect Indian waters from the wreck hazards and introduce internationally recognized and approved rules for removal of wrecks. Similarly, private and public entities will be encouraged to participate in salvage operations on account of adequate remuneration for services rendered specially to protect the environment or minimize its damage. Salvage services provided for saving life, cargo or wreck will be paid on priority to other claims for salvage. Salvage services provided by the Government shall also be entitled to rights and remedies as those of any other salvor. The Bill provides for duties of the salvor, owner and master of a vessel. It also provides for rights and duties of the Central Government in cases of maritime casualty in protecting its environment and coastline and to pass directions with regard to salvage operations. The disputes relating to claims shall be determined by the High Courts. Action on payment for salvage shall extinguish if such claim is not made within two years.