FUTURE DEVELOPMENTS OF IOPCF

José Maura
Head of Claims
International Oil Pollution Compensation Funds 1971 and 1992

PAJ Oil Spill International Symposium 2002
Tokyo, Japan
March 2002

Introduction
Compensation for pollution damage caused by spills from oil tankers is governed by an international regime
elaborated under the auspices of the International Maritime Organization (IMO). The framework for the regime
was originally the 1969 International Convention on Civil Liability for Oil Pollution Damage (1969 Civil Liability
Convention) and the 1971 International Convention on the Establishment of an International Fund forCompensation for Oil Pollution Damage (1971 Fund Convention). This 'old' regime was amended in 1992 by
two Protocols, and the amended Conventions are known as the 1992 Civil Liability Convention and the 1992
Fund Convention. The 1992 Conventions entered into force on 30 May 1996.
Since the 1969 Civil Liability Convention and the 1971 Fund Convention have been denounced by a number ofStates and are losing importance, this note deals primarily with the 'new' regime, ie the 1992 Civil Liability
Convention and the 1992 Fund Convention.
The 1992 Civil Liability Convention governs the liability of shipowners for oil pollution damage. The Convention
lays down the principle of strict liability for shipowners and creates a system of compulsory liability insurance.
The shipowner is normally entitled to limit his liability to an amount which is linked to the tonnage of his ship.
The 1971 and 1992 Fund Conventions are supplementary to the 1969 Civil Liability Convention and the 1992 Civil
Liability Convention respectively. Each Fund Convention establishes a regime for compensating victims when
the compensation under the applicable Civil Liability Convention is inadequate. The 1971 and 1992 Fund
Conventions each established an intergovernmental organisation to administer the compensation regime createdby the respective Fund Convention, the International Oil Pollution Compensation Funds 1971 and 1992 (IOPC
Funds). The Organisations have their headquarters in London.
The States Parties to the 1969, 1971 and 1992 Conventions are listed in Annex I.
As at 1 February 2002, 81 States were Parties to the 1992 Civil Liability Convention, and 75 States were Parties
to the 1992 Fund Convention.
Information on the international compensation regime and the IOPC Funds is available on the Funds’ web site
at: http://www.iopcfund.org

The international compensation regime
Substantive provisions
Scope of application
The 1969 and 1971 Conventions apply to pollution damage caused by spills of persistent oil from tankers andsuffered in the territory (including the territorial sea) of a State Party to the respective Convention. Under the
1992 Conventions, however, the geographical scope is wider, with the cover extended to pollution damage
caused in the exclusive zone (EEZ) or equivalent area of a State Party. 'Pollution damage' includes the cost of'preventive measures', ie measures to prevent or minimise pollution damage.
Damage caused by non-persistent oil is not covered by the Conventions. Spills of gasoline, light diesel oil,kerosene, etc, therefore do not fall within the scope of the Conventions.
The 1969 Civil Liability Convention and the 1971 Fund Convention apply only to measures taken after oil has
escaped or been discharged. These Conventions therefore do not apply to pure threat removal measures, ie
preventive measures which are so successful that there is no actual spill of oil from the tanker involved. Under
the 1992 Conventions, however, expenses incurred for preventive measures are recoverable even when no spillof oil occurs, provided that there was a grave and imminent threat of pollution damage.

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The 1969 and 1971 Conventions apply only to ships which actually carry oil in bulk as cargo, ie generally laden
tankers. Spills from tankers during ballast voyages are therefore not covered by these Conventions. The 1992
Conventions apply also to spills of bunker oil from unladen tankers in certain circumstances. Neither the
1969/1971 Conventions nor the 1992 Conventions apply to spills of bunker oil from ships other than tankers (iedry cargo ships).
Shipowner's liability
The owner of a tanker has strict liability (ie he is liable also in the absence of fault) for pollution damage causedby oil spilled from the tanker as a result of an incident. He is exempt from liability under the Civil Liability
Conventions only if he proves that:
(a)
(b)
(c)

the damage resulted from an act of war or a grave natural disaster, or
the damage was wholly caused by sabotage by a third party, or
the damage was wholly caused by the negligence of public authorities in maintaining lights or othernavigational aids.

Under certain conditions the shipowner is entitled to limit his liability to an amount which is linked to the tonnageof the vessel. The limit of the shipowner's liability under the 1969 Civil Liability Convention is the lower of
133 Special Drawing Rights (SDR) < 1 > (US$165) per ton of the ship's tonnage or 14 million SDR(US$17.4 million). Under the 1992 Civil Liability Convention, the limits are:
(a)
(b)
(c)

for a ship not exceeding 5 000 units of gross tonnage, 3 million SDR (US$3.7 million);
for a ship with a tonnage between 5 000 and 140 000 units of tonnage, 3 million SDR (US$3.7 million)
plus 420 SDR (US$521) for each additional unit of tonnage; andfor a ship of 140 000 units of tonnage or over, 59.7 million SDR (US$74 million).

There is a simplified procedure under the 1992 Civil Liability Convention for increasing these limits.
Under the 1969 Civil Liability Convention, the shipowner is deprived of the right to limit his liability if the incident
occurred as a result of the owner's personal fault ('actual fault or privity'). Under the 1992 Convention, however,the shipowner is deprived of this right only if it is proved that the pollution damage resulted from the shipowner's
personal act or omission, committed with the intent to cause such damage, or recklessly and with knowledge thatsuch damage would probably result.
Channeling of liability
Claims for pollution damage under the Civil Liability Conventions can be made only against the registered ownerof the ship concerned. This does not preclude victims from claiming compensation outside the Conventions
from persons other than the owner. However, the 1969 Civil Liability Convention prohibits claims against theservants or agents of the shipowner. The 1992 Civil Liability Convention prohibits not only claims against theservants or agents of the owner, but also claims against the pilot, the charterer (including a bareboat charterer),manager or operator of the ship, or any person carrying out salvage operations or taking preventive measures.
Compulsory insurance
The owner of a tanker carrying more than 2 000 tonnes of persistent oil as cargo is obliged to maintain insurance
to cover his liability under the applicable Civil Liability Convention. Tankers must carry a certificate on board
attesting the insurance coverage. When entering or leaving a port or terminal installation of a State Party to the1969 or 1992 Civil Liability Convention, such a certificate is required also for ships flying the flag of a State
which is not Party to that Convention.
Claims for pollution damage under the Civil Liability Conventions may be brought directly against the insurer ofthe owner's liability for pollution damage.

<1> The unit of account in the Conventions is the Special Drawing Right (SDR) as defined by the International Monetary Fund. In
this paper, the SDR has been converted into US dollars at the rate of exchange applicable on 1 February 2002, ie 1 SDR =US$1.239770.

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IOPC Funds' obligations
The IOPC Funds 1971 and 1992 pay compensation to those suffering oil pollution damage in a State Party to therespective Fund Convention who do not obtain full compensation under the applicable Civil Liability Convention
in the following cases:
(a)
(b)

(c)

the shipowner is exempt from liability under the applicable Civil Liability Convention because he can
invoke one of the exemptions under that Convention; or
the shipowner is financially incapable of meeting his obligations under the applicable Civil Liability
Convention in full and his insurance is insufficient to satisfy the claims for compensation for pollution
damage; orthe damage exceeds the shipowner's liability under the applicable Civil Liability Convention.

The compensation payable by the 1971 Fund in respect of an incident is limited to an aggregate amount of
60 million SDR (US$74 million), including the sum actually paid by the shipowner (or his insurer) under the 1969
Civil Liability Convention. The maximum amount payable by the 1992 Fund in respect of an incident is
135 million SDR (US$167 million), including the sum actually paid by the shipowner (or his insurer) under the
1992 Civil Liability Convention.
The 1992 Fund Convention provides a simplified procedure for increasing the maximum amount payable by the
1992 Fund.
The IOPC Funds do not pay compensation if:
(a)
(b)
(c)

the damage occurred in a State which was not a Member of the respective Fund; orthe pollution damage resulted from an act of war or was caused by a spill from a warship; orthe claimant cannot prove that the damage resulted from an incident involving one or more ships as
defined in the applicable convention (ie a sea-going vessel or seaborne craft of any type whatsoever
actually carrying oil in bulk as cargo under the 1969/1971 Conventions and a seagoing vessel orseaborne craft of any type whatsoever constructed or adapted for the carriage of oil in bulk as cargo
under the 1992 Conventions)

Jurisdiction and enforcement of judgements
Actions for compensation under the applicable Civil Liability Convention against the shipowner or his insurer may
only be brought before the Courts of the State Party to that Convention in the territory, territorial sea or EEZ ofwhich damage was caused.
Actions for compensation under the applicable Fund Convention against the respective Fund may only be
brought before the Courts of the State Party to that Convention in the territory, territorial sea or EEZ of which
damage was caused.
The Conventions also contain special provisions relating to the recognition and enforcement of judgements.

Comparison between the 'old' and 'new' regimes
The principal differences between the 1969 and 1971 Conventions ('old' regime) and the 1992 Conventions('new' regime) are summarised in Annex II.

Organisation of the IOPC Funds
Each Fund has an Assembly, which is composed of representatives of all Member States. The Assembly is thesupreme organ governing the respective Fund, and it holds regular sessions once a year. Each Assembly elects
an Executive Committee comprising 15 Member States. The main function of these Committees is to approvesettlements of claims.
The 1992 Fund and the 1971 Fund have a joint Secretariat. The Secretariat is headed by a Director and has atpresent 26 staff members.
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The Director has been granted extensive authority to approve claims for compensation.

Financing of the 1992 Fund
The 1992 Fund is financed by contributions levied on any person who has received in one calendar year morethan 150 000 tonnes of crude oil and heavy fuel oil (contributing oil) in a State Party to the 1992 Fund Convention.
<2>

Basis of contributions
The levy of contributions is based on reports of oil receipts in respect of individual contributors. A State shallcommunicate every year to the 1992 Fund the name and address of any person in that State who is liable tocontribute, as well as the quantity of contributing oil received by any such person. This applies whether thereceiver of oil is a Government authority, a State-owned company or a private company. Except in the case of
associated persons (subsidiaries and commonly controlled entities), only persons having received more than
150 000 tonnes of contributing oil in the relevant year should be reported.
Contributing oil is counted for contribution purposes each time it is received at ports or terminal installations in
a Member State after carriage by sea. The term received refers to receipt into tankage or storage immediately
after carriage by sea. The place of loading is irrelevant in this context; the oil may be imported from abroad,
carried from another port in the same State or transported by ship from an off-shore production rig. Also oil
received for transhipment to another port or received for further transport by pipeline is considered received forcontribution purposes.
Payment of contributions
Annual contributions are levied by the 1992 Fund to meet the anticipated payments of compensation andadministrative expenses during the coming year. Each contributor pays a specified amount per tonne ofcontributing oil received. The amount levied is decided each year by the Assembly.
The Director issues an invoice to each contributor, following the decision taken by the Assembly to levy annual
contributions. A system of deferred invoicing exists whereby the Assembly fixes the total amount to be leviedin contributions for a given calendar year, but decides that only a specific lower total amount should be invoiced
for payment by 1 March in the following year, the remaining amount, or a part thereof, to be invoiced later in theyear if it should prove to be necessary.
The contributions are payable by the individual contributors directly to the 1992 Fund. A State is not responsible
for the contributions levied on contributors in that State, unless it has voluntarily accepted such responsibility.
The Japanese oil industry is the major contributor to the 1992 Fund, paying 20.01% of the total contributions.
The Italian oil industry is the second largest contributor paying 10.69%, followed by the oil industries in the
Republic of Korea, the Netherlands, France, United Kingdom, Singapore, Spain, Canada, Germany, Australia and
Norway.
Payments made by the IOPC Funds in respect of claims for compensation for oil pollution damage may varyconsiderably from year to year, resulting in fluctuating levels of contributions.
The following table sets out the contributions levied by the 1992 Fund during the period 1996-2001.

<2> The 1971 Fund is financed in the same way as the 1992 Fund.
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Annualcontributions

Date due

Total
contribution£

Contribution per tonne

1996

1.2.97
1.9.974 000 000
10 000 000

0.0110440
0.0188066

Contribution
per million
tonnes£11 04418 8071997

1.2.98Maximum deferred levy

9 500 000
30 000 000

0.0114295(No deferred levy made)11 430-1998

1.2.991.9.9928 200 000
9 000 000

0.0400684
0.0134974

40 06813 497

1999

Credit: 1.3.00
1.9.00-3 700 000
53 000 000-0.0056367
0.0552651-5 63755 2652000

1.3.01
Maximum deferred levy

49 500 000
43 000 000

0.0545770(No deferred levy made)54 577-2001

1.3.02
Maximum deferred levy

41 000 000
21 000 000

0.0428439
0.0188148

42 84418 815-5-£The following table sets out the contributions levied by the 1971 Fund during the period 1990-2001.
AnnualContributions

Due date

Total contribution£

Contribution per
tonne

Contribution per
million tonnes££

InitialContributions
1990

500 000

0.0027896
0.0005563

2 790
556

1991

26 700 000

0.0287013

28 7011992

10 950 000

0.0116210

11 6211993

78 000 000

0.0785397

78 5401994

40 000 000

0.0389400

38 9401995

43 000 000

0.0391209

39 121

1996

Due 1.2.97:
Due 1.9.97:

18 000 000
37 800 000

0.0150285
0.0306697

15 02930 6701997

Due 1.2.98:
Maximum deferred levy

32 200 000
27 000 000

0.0264108(No deferred levy made)26 411

1998

Due 1.2.99:
Maximum deferred levy

9 200 000
17 500 000

0.0085939(No deferred levy made)

8 594

1999

Due 1.3.00:
Maximum deferred levy

3 800 000
2 000 000

0.0025039(No deferred levy made)

2 504

2000

Due 1.3.01
Maximum deferred levy

0
25 000 000

0(No deferred levy made)

0

2001

Due 1.3.02
Maximum deferred levy

0
24 200 000

00.0585895

0
58 590Recent developments'Old' regime in decline
The 1969 Civil Liability Convention and the 1971 Fund Convention have been denounced by a number of States,
so that the number of 1971 Fund Member States has fallen from 77 to its present level of 24. A further two
States have also denounced the 'old' Conventions and will have ceased to be 1971 Fund Member States by
May 2002. Meanwhile, the number of 1992 Fund Member States has risen to 64, and a further 11 States haveacceded to the 1992 Protocols and will have become 1992 Fund Member States by the end of January 2003.
As more States joined the 1992 Fund and ceased to be Members of the 1971 Fund, the 'old' regime has lost its
importance.
Financial consequences of the denunciations
With the departure from the 1971 Fund of a number of States, the total quantity of contributing oil on the basisof which contributions are assessed has been reduced from its maximum of some 1 200 million tonnes to its
present level of approximately 100 million tonnes. By the end of 2001 the total quantity of contributing oil
received in the remaining 1971 Fund Member States will have decreased further to some eight million tonnes.
The effect of this reduction in the contribution base is the considerably increased financial burden which mightfall on the contributors in those States which remain Members of the 1971 Fund if a major oil spill occurs in anyof those States.
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Winding up of the 1971 Fund
The 1971 Fund Convention provides that the Convention will cease to be in force on the date when the numberof Contracting States falls below three. Before the 1971 Fund can be wound up, however, the 1971 Fund would
have to meet its obligations in respect of all incidents that occurred before the Convention ceased to be in force.
As long as the 1971 Fund remains in existence, it may attract additional liabilities arising out of new incidents in1971 Fund Member States. There was considerable concern that before the 1971 Fund could be wound up it
would face a situation in which an incident occurred and the 1971 Fund had an obligation to pay compensation
to victims, but where there were no contributors in any of the remaining Member States. It should be noted that
there were over 20 Member States where there are no contributors because no entities in those States receive
more than 150 000 tonnes of contributing oil in a calendar year.
In the situation set out above, if a tanker spill occurred the remaining 1971 Fund Member States would not in fact
have the financial protection which they would expect in accordance with the provisions of the 1971 Fund
Convention.
For these reasons, it was considered important for the 1971 Fund to be wound up as soon as possible.
Operational problems for the 1971 FundIn April 1998 the 1971 Fund Assembly addressed the problems which would arise for the 1971 Fund if, with thefalling membership, the Assembly were unable to achieve a quorum (more than half of the Member States).
There was particular concern that certain functions of the Assembly, such as adopting the budget, fixing annual
contributions, settling claims and electing a legal representative (ie the Director), could not be carried out. The
Assembly therefore adopted a resolution - in the interests of victims of pollution damage - setting out certain
measures which would enable the compensation system established under the 1971 Fund Convention to continue
to function.
Despite extra efforts on the part of the Secretariat, the 1971 Fund Assembly did not achieve a quorum for its
sessions in October 1998 and October 1999, since less than half of the Member States were present at therequired time. As a result, the items on the agendas of the Assembly were dealt with by the 1971 Fund's
Executive Committee.
Since April 2000 also the Executive Committee has been unable to achieve a quorum of two thirds of its 15
Member States. The functions of the Assembly and Committee were then performed by a newly-created body,known as the Administrative Council, which has no quorum requirement. Decisions of the Administrative
Council are taken by majority vote of both 1971 Fund Member States and former 1971 Fund Member States,
but former Member States have the right to vote only in respect of issues relating to incidents which occurred
while they were Members.
Duty of States to submit oil reports
The obligation to submit oil reports to the 1971 and 1992 Funds rests on the Member States. These reports are
essential to the functioning of the Fund system, as they provide the data from which contributions can beassessed and invoices issued. The reports have to be submitted to the Secretariat by 30 April each year. If no
entity in a Member State has received more than 150 000 tonnes of contributing oil in the year in question, theState is required to notify the Secretariat accordingly ('nil' reports).
The non-submission of oil reports by a number of States was considered by the delegations at the October 1998
sessions of the governing bodies of both the 1971 Fund and the 1992 Fund to be a matter of serious concern toother Member States and in particular to the contributors in those States, since without oil reports the Secretariat
cannot issue invoices for contributions. At the time of the October 2000 session of the 1971 Fund's governing
bodies, two thirds of the Member States had not submitted their reports for the previous year.
In accordance with the decisions taken by the Funds' governing bodies in October 1998, if a State does not
submit its oil reports in future, the Director will make contacts with that State and emphasise the concerns
expressed by the governing bodies of each Organisation. The Assembly will review individually each State which
has not submitted its report and decide on the course of action to be taken for each State. Such a review wasmade at the governing bodies' sessions in October 1999, October 2000 and October 2001.
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Diplomatic Conference to amend Article 43.1 of the 1971 Fund Convention
Under Article 43.1 in its original version the 1971 Fund Convention ceases to be in force when the number ofContracting States falls below three. Although many States had denounced the 1971 Fund, it was unlikely thatthe number of Contracting States would fall below three in the foreseeable future.
In October 1999 a number of ways of accelerating the winding up of the 1971 Fund were considered by the 1971
Fund Executive Committee, acting on behalf of the Assembly. The Committee decided that IMO should berequested to convene urgently a Diplomatic Conference for the purpose of adopting a Protocol amending Article
43.1 of the 1971 Fund Convention, to the effect that the Convention would cease to be in force well before thenumber of Contracting States would fall below three. In November 1999 the IMO Assembly approved the 1971
Fund’s request and the Diplomatic Conference was held from 25 to 27 September 2000. The Conference
adopted a Protocol under which the 1971 Fund Convention will cease to be in force on the date on which thenumber of Contracting States falls below 25, or 12 months following the date on which the Assembly (or any
other body acting on its behalf) notes that the total quantity of contributing oil received in the remaining Member
States has fallen below 100 million tonnes.
Normally such an amendment to a Convention would be binding only on the States which had expressed theiracceptance thereof. However, serious difficulties would result if explicit acceptance were required. For thisreason the Protocol provides that the amendment to Artic le 43.1 will be brought into force by means of asimplified procedure by tacit or implied consent, ie by States failing to object by 27 March 2001. The 2000
Protocol entered into force on 27 June 2001 since no such objections were lodged.
Due to a number of recent denunciations of the 1971 Fund Convention, the number of Contracting States will
fall below 25 on 24 May 2002, and the Convention will therefore cease to be in force on 24 May 2002. The
Convention will therefore not apply to incidents occurring after that date.

Claims Settlement
Claims experience
Since its establishment in 1978, the 1971 Fund has been involved in some 105 incidents. The 1971 Fund has paid
over US$410 million in compensation. So far the 1992 Fund has been involved in 12 incidents and has madecompensation payments totalling US$87 million.
In the great majority of these incidents, all claims have been settled out of court. So far, court actions against
the 1971 Fund have been taken in respect of only seven incidents, namely the Haven (Italy, 1991), Aegean Sea(Spain, 1992), Braer (United Kingdom, 1993) and Keumdong N°5, Sea Prince and Yuil N°1 (Republic of Korea,
1993, 1995 and 1995) and Nissos Amorgos (Venezuela, 1997) incidents. In most of these cases, the aggregate
amounts claimed greatly exceeded the maximum amount payable under the 1969 Civil Liability Convention andthe 1971 Fund Convention. However, except as regards the Aegean Sea incident, most of the claims were settled
out of court. In March 1999 all outstanding issues arising out of the Haven incident were settled out of court.
As for the Keumdong N°5, the Sea Prince, the Yuil N°1 and the Nissos Amorgos, only a few claims are pendingin court.
The cases involving the largest total payments so far are the Braer and Nadhodka incidents, where £46.4 million(US$68 million) and £91.5 million (US$133 million) respectively have been paid to claimants.

Claims Handling
Co-operation between the IOPC Funds and P&I Clubs
In the handling of claims the IOPC Funds co-operate closely with the shipowner and his insurer, who in nearly
all major cases is one of the Protection and Indemnity Associations (P&I Clubs) belonging to the International
Group of P&I Clubs.

-8-There are several reasons why co-operation with the P&I Clubs is so important. Firstly, under the Conventions
the primarily liable subject is the shipowner and his insurer. Secondly, if the claims handling is carried out jointly
by the IOPC Funds and the P&I Club, it facilitates the procedure for the claimants who can submit their claims
only once and receive only one assessment. Finally, and most importantly, without close co-operation between
the Funds and the Clubs there is a risk that the position taken by the Funds and that taken by the Clubs in respectof individual claims would differ. This would not only place the claimant in a difficult position, but would also
result in a very complex legal situation when the amounts available under the Conventions are to be distributed
between claimants. This would be so in particular in cases where the total amount available under the applicable
Civil Liability Convention and Fund Convention is insufficient to compensate the claimants in full and thepayments therefore have to be limited to a certain percentage of the admissible loss or damage.
It should be recognised, however, that in certain cases there exists a conflict of interests between the
shipowner/P&I Club and the IOPC Funds, for example where the IOPC Funds decide to challenge, or consider
challenging, the shipowner's right to limit his liability. In such cases there are clearly limits to the extent of thisco-operation. Even in these cases, however, it would normally be possible and beneficial for the handling ofclaims for compensation to be carried out in close co-operation between the IOPC Funds and the P&I Club
concerned.
Use of technical experts
Since the IOPC Funds have a small Secretariat, they normally use external experts to assist the permanent staff
to monitor the clean-up operations and to examine and assess claims, at least in respect of major incidents. For
the reasons given above, the external experts are usually appointed jointly by the IOPC Funds and the P&I Club
concerned.
The selection of experts will depend on the characteristics of the particular oil spill. In countries where there areexperts who have sufficient knowledge and experience, local experts will normally be engaged. Where no such
expertise exists in the country concerned, foreign experts will have to be engaged
In order to contribute to the uniformity in application and consistency of approach, the IOPC Funds prefer toengage the same team of experts in all major incidents, wherever they occur. The Funds therefore normally use
the experts of the International Tanker Owners Pollution Federation Limited (ITOPF) who have the appropriatetechnical knowledge and are familiar with the IOPC Funds' policy in respect of the admissibility of claims. Theseexperts have attended some 400 oil spills all over the world and have accumulated enormous experience. In
cases where local expertise is available, ITOPF experts work together with local experts. In special fields, eg
fishery and tourism, the Funds sometimes engage other experts with international experience.
It should be emphasised that decisions on the admissibility of claims and the admissible quantum is taken by the
Director of the IOPC Funds; the role of the experts (be it local experts or those from ITOPF) is always only thatof advisers.
Claims settlement procedures
It is vital for the Funds to be notified immediately of new incidents in which it might become involved or in
respect of which there is a real possibility that the Funds might have to pay compensation, so that their experts
can attend the site of a spill as soon as possible.
In some cases claims are channelled through the office of a designated local surveyor. Occasionally, when an
incident gives rise to a large number of claims, the IOPC Funds and the P & I Club have jointly set up a local
claims office so that claims may be processed more easily. Neither designated local surveyors nor local claims
offices decide on the admissibility of claims; decisions are taken by the respective Fund and the P & I Club.
The Director of the Funds is authorised to settle the claims and pay compensation if it is unlikely that the
total payments by the respective Fund in respect of the incident in question will exceed 2.5 million SDR(US$3.1 million). For incidents leading to higher claims, the Director needs the approval of the settlement fromthe Executive Committee of the 1971 or 1992 Fund. However, in recent cases the Executive Committees havegiven the Director very extensive authority to settle claims arising out of particular incidents. The Director ispermitted, in certain circumstances and within certain limits, to make provisional payment of compensation-9-

before a claim is settled, if this is necessary to mitigate undue financial hardship to victims of pollution incidents.
These procedures are designed to expedite the payment of compensation.
It should be pointed out that the Funds become involved in the payment of compensation only if the aggregate
amount of the proven damage arising out of a particular incident exceeds the limitation amount under the relevant
Civil Liability Convention (except in the rare cases where the shipowner is exonerated from liability). For thisreason, the Funds cannot make any payments unless it is established that the shipowner's limitation amount willin fact be exceeded.
The joint Secretariat of the two Funds is always ready to offer assistance to those who seek information on how
to present their claims against the Funds.
It must be emphasised that the time needed for the settlement of claims is almost entirely dependent on the qualityof the documentation submitted in support of the claims. In cases where the claims are well documented, it isoften possible to reach a settlement within a short period of time after the presentation of the documentation. If,
however, the documentation is insufficient, it may take a considerable time before a settlement can be reached,since protracted correspondence between the Fund and the claimant may be necessary.

Admissibility of Claims for Compensation
General considerations
The Funds can pay compensation to a claimant only to the extent that his claim is justified and meets the criteria
laid down in the applicable Fund Convention. To this end, a claimant is required to prove his claim by producing
explanatory notes, invoices, receipts and other documents to support the claim.
For a claim to be accepted by the Funds, it has to be proved that the claim is based on a real expense actually
incurred, that there was a link between the expense and the incident and that the expense was made forreasonable purposes.
The IOPC Funds have acquired considerable experience with regard to the admissibility of claims. In connection
with the settlement of claims they have developed certain principles as regards the meaning of the definition of'pollution damage', which is specified as 'damage caused by contamination'. In 1994 a Working Group of the1971 Fund examined in depth the criteria for the admissibility of claims for compensation within the scope of the1969 Civil Liability Convention, the 1971 Fund Convention and the 1992 Protocols. The Report of the Working
Group was endorsed by the Assembly of the 1971 Fund. The Assembly of the 1992 Fund has adopted a
Resolution to the effect that this Report shall form the basis of its policy on the criteria for the admissibility ofclaims.
The 1971 and 1992 Fund Assemblies have expressed the opinion that a uniform interpretation of the definitionof 'pollution damage' is essential for the functioning of the regime of compensation established by theConventions. The IOPC Funds' position in this regard applies not only to questions of principle relating to theadmissibility of claims but also to the assessment of the actual loss or damage where the claims do not give riseto any question of principle.
The importance of uniformity of application is obvious, since the oil industry in one Member State pays for thecost of clean-up operations incurred and economic losses suffered in other Member States. Unless a reasonably
high degree of uniformity and consistency is achieved, there is a risk of great tensions arising between Member
States and of the international compensation systems no longer being able to function properly.
The Funds consider each claim on the basis of its own merits, in the light of the particular circumstances of thecase. Whilst criteria for the admissibility of claims have been adopted, a certain flexibility is nevertheless allowed,
enabling the Funds to take into account new situations and new types of claims. Generally, the Funds follow a
pragmatic approach, so as to facilitate out-of-court settlements.
Decisions on the admissibility of claims which are of general interest are reported in the IOPC Funds' Annual
Report.
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The IOPC Funds have published Claims Manuals which contain general information on how claims should bepresented and set out the general criteria for the admissibility of various types of claims.
Property damage
Pollution incidents often result in damage to property: the oil may contaminate fishing boats, fishing gear, yachts,
beaches, piers and embankments. The Funds accept costs for cleaning polluted property. If the polluted
property (eg fishing gear) cannot be cleaned, the Funds compensate the cost of replacement, subject todeduction for wear and tear. Measures taken to combat an oil spill may cause damage to roads, piers andembankments and thus necessitate repair work, and reasonable costs for such repairs are accepted by the Funds.
Clean-up operations on shore and at sea, and preventive measures
The Funds pay compensation for expenses incurred for clean-up operations at sea or on the shore. Operationsat sea may relate to the deployment of vessels, the salaries of crew, the use of booms and the spraying ofdispersants. In respect of onshore clean-up, the operations may result in major costs for personnel, equipment,
absorbents etc.
Claims for measures to prevent or minimise pollution damage are assessed on the basis of objective criteria. The
fact that a government or other public body decides to take certain measures does not in itself mean that themeasures are reasonable for the purpose of the Conventions. The technical reasonableness is assessed on thebasis of the facts available at the time of the decision to take the measures. However, those in charge of theoperations should continually reappraise their decisions in the light of developments and further technical advice.
Claims for costs are not accepted when it could have been foreseen that the measures taken would be ineffective.
On the other hand, the fact that the measures prove to be ineffective is not in itself a reason for rejection of aclaim for the costs incurred. The costs incurred, and the relationship between those costs and the benefits
derived or expected, should be reasonable. In the assessment, the IOPC Funds take account of the particular
circumstances of the incident.
Measures taken to prevent or minimise pollution damage ('preventive measures') are compensated by the Funds.
Measures may have to be taken to prevent oil which has escaped from a ship from reaching the coast, eg byplacing booms along the coast which is threatened. Dispersants may be used at sea to combat the oil. Costs forsuch operations are in principle considered as costs of preventive measures. It must be emphasised, however,that the definition only covers costs of reasonable measures.
Salvage operations may in some cases include an element of preventive measures. Such operations can beconsidered as preventive measures only if the primary purpose is to prevent pollution damage. If the operations
have another purpose, such as salving hull and cargo, the costs incurred are not admissible under theConventions. If the activities are undertaken for the purpose of both preventing pollution and salving the ship
and cargo, but it is not possible to establish with any certainty the primary purpose of the operations, the costs
are apportioned between pollution prevention and other activities. The assessment of compensation for activities
which are considered to be preventive measures is not made on the basis of the criteria applied for assessing
salvage awards; the compensation is limited to costs, including a reasonable element of profit.
Fixed costs
Claims submitted by public authorities for carrying out clean-up operations and preventive measures often
include elements covering costs which would have arisen even if the incident had not occurred (eg normal
salaries for permanently employed personnel). Such fixed-costs are distinguished from additional costs, ie costs
incurred solely as a result of the incident which would not have arisen otherwise (eg payments for overtime).
The Funds' position is that a reasonable proportion of fixed costs should be admissible, provided that such costs
correspond closely to the clean-up period in question and do not include remote overhead charges.
Consequential loss and pure economic loss
The Funds accept in principle claims relating to loss of earnings suffered by the owners or users of property
which had been contaminated as a result of a spill (consequential loss). One example of consequential loss is afisherman’s loss of income as a result of his nets becoming polluted.

- 11 -

An important group of claims comprises those relating to pure economic loss, ie loss of earnings sustained bypersons whose property has not been polluted. A fisherman whose boat and nets have not been contaminatedmay be prevented from fishing because the area of the sea where he normally fishes is polluted and he cannot
fish elsewhere. Similarly, a hotelier or restaurateur whose premises are close to a contaminated public beach
may suffer loss of profit because the number of guests falls during the period of pollution.
Claims for pure economic loss are admissible only if they are for loss or damage caused by contamination. The
starting point is the pollution, not the incident itself.
In order to qualify for compensation the basic criterion is that a reasonable degree of proximity exists between
the contamination and the loss or damage sustained by the claimant. A claim is not admissible on the solecriterion that the loss or damage would not have occurred but for the oil spill in question. When considering
whether the criterion of reasonable proximity is fulfilled, the following elements are taken into account:
??
??
??
??

the geographic proximity between the claimant's activity and the contamination
the degree to which a claimant is economically dependent on an affected resource
the extent to which a claimant has alternative sources of supply or business opportunities
the extent to which a claimant's business forms an integral part of the economic activity within the area
affected by the spill

Account is also taken of the extent to which a claimant can mitigate his loss.
Measures to prevent pure economic loss
Claims for the cost of measures to prevent pure economic loss may be admissible if they fulfil the following
requirements:?? the cost of the proposed measures is reasonable?? the cost of the measures is not disproportionate to the further damage or loss which they are intended
to mitigate?? the measures are appropriate and offer a reasonable prospect of being successful?? in the case of a marketing campaign, the measures relate to actual targeted markets.
To be admissible, the costs should relate to measures to prevent or minimise losses which, if sustained, would
qualify for compensation under the Conventions. Claims for the cost of marketing campaigns or similar activities
are accepted only if the activities undertaken are in addition to measures normally carried out for this purpose.
In other words, compensation is granted only for the additional costs resulting from the need to counteract thenegative effects of the pollution.

Environmental damage
In 1980 the 1971 Fund Assembly adopted an important Resolution on the admissibility of claims relating todamage to the environment. In the Resolution it is stated that the assessment of compensation "... is not to bemade on the basis of an abstract quantification of damage calculated in accordance with theoretical models". In
other words, compensation can be granted only if a claimant, who has a legal right to claim under national law,has suffered quantifiable economic loss.
Damage to the marine environment cannot be easily assessed in monetary terms, as the marine environment does
not have a direct market value. In recent years models have been elaborated in many countries for theassessment of damage to the marine environment. It is submitted that any assessment of ecological damage tothe marine environment in monetary terms would require sweeping assumptions regarding relationships between
different components of the environment and economic values. Any calculation of the damage suffered inmonetary terms would by necessity be arbitrary. For this reason, it is maintained that it would be inappropriate
to admit claims for compensating damage to unexploited natural resources which have no owner.
The 1992 Conventions contain an amended wording of the definition of pollution damage. A proviso was added
to the effect that compensation for impairment of the environment (other than loss of profit from such
impairment) should be limited to costs of reasonable measures of reinstatement actually undertaken or to be- 12 -

undertaken. This new wording was not in any way intended to widen the concept, but rather to codify theinterpretation of the definition as developed by the 1971 Fund.
The Funds have decided that in order for claims for the cost of measures to reinstate the marine environment tobe admissible for compensation, the measures should fulfil the following criteria:?? the cost of the measures should be reasonable;?? the cost of the measures should not be disproportionate to the results achieved or the results which
could reasonably be expected; and?? the measures should be appropriate and offer a reasonable prospect of success.
The test of reasonableness laid down in the 1992 Protocol to the Civil Liability Convention is an objective one, ie
the measures should be reasonable from an objective point of view in the light of the information available when
the specific measures are taken. Compensation is payable only in respect of measures actually undertaken or to
be undertaken.
Post-spill environmental studies are sometimes carried out to establish the precise nature and extent of thepollution damage caused by an oil spill and/or the need for reinstatement measures. The 1992 Fund may
contribute to the cost of such studies, provided that the studies concern damage which falls within the definitionof pollution damage laid down in the Conventions as interpreted by the 1992 Fund, including reasonablemeasures to reinstate the environment. In such cases, the 1992 Fund should be given the possibility of becoming
involved at an early stage in the selection of the experts who will carry out the studies, and in the determinationof the mandate of these experts. The studies should be practical and likely to deliver the required data. Their
scale should not be out of proportion to the extent of the contamination and the predictable effects. The extent
of the studies and associated costs should also be reasonable from an objective point of view and the costs
incurred should be reasonable.

Increase in the maximum amount of compensation available under the 1992
Conventions
At its session in October 2000, the Legal Committee of IMO considered a proposal by a number of States toincrease the limits of liability and compensation laid down in the 1992 Civil Liability Convention and the 1992
Fund Convention by using the special procedure laid down in the Conventions, the 'tacit amendment procedure'.
The Committee adopted two resolutions increasing the limits contained in the Conventions by some 50.37%.
The amendments will enter into force on 1 November 2003, unless prior to 1 May 2002 not less than one quarterof the States which were Contracting States to the respective Conventions on 18 October 2000 havecommunicated to IMO that they do not accept these amendments. So far no such communications have been
received.
The increased limits of the shipowner's liability would be as follows:a)for a ship not exceeding 5 000 units of gross tonnage, 4 510 000 SDR (US$5.6 million);b)

for a ship with a tonnage between 5 000 and 140 000 units of tonnage, 4 510 000 SDR (US$5.6 million)
plus 631 SDR (US$782) for each additional unit of tonnage; anda)for a ship of 140 000 units of tonnage or over, 89 770 000 SDR (US$111 million).

The amendment to the 1992 Fund Convention would bring the total amount available under the 1992 Conventions
to 203 million SDR (US$252 million).

Review of the adequacy of the international compensation regime
Working Group established to consider the issues involved- 13 -

In April 2000, the 1992 Fund Assembly established a Working Group to examine the adequacy of theinternational compensation regime established by the 1992 Civil Liability Convention and the 1992 Fund
Convention. The point was made that although the system had worked well on many occasions there were
inadequacies in the system.
The Working Group met on 6 July 2000 for a preliminary exchange of views and to draw up a list of issues forfurther consideration. The Working Group met again in March and June 2001. Its Report was considered by
the Assembly in October 2001.
Maximum level of compensation
During the discussions in the Working Group a number of States maintained that in order for the international
compensation system to retain credibility the maximum compensation levels should be sufficiently high to ensure
full compensation to victims even in the most serious oil spill incidents. Other delegations, however, did not see
the need to increase the maximum level of compensation over and above the increases adopted within theInternational Maritime Organization (IMO) in October 2000 which would bring the total amount available to203 million SDR (US$252 million) from 1 November 2003.
In light of this difference in views, the Working Group considered a proposal to establish an optional third tierof compensation by means of a Supplementary Compensation Fund, which would provide additional
compensation over and above the compensation available under the 1992 Civil Liability Convention and the 1992
Fund Convention (ie 135 million SDR or from 1 November 2003 203 million SDR).
A number of delegations expressed their support for the proposed Supplementary Fund. It was emphasised thatsuch a supplementary scheme should preferably be set up on a global rather than a regional basis. Severaldelegations stated that, although their States were not interested in joining the proposed supplementary scheme,
they supported the proposed scheme or did not oppose its creation.
The observer delegations representing shipping, insurance and oil interests supported the Supplementary Fund
scheme in principle. It was emphasised, however, that it was important to preserve the sharing of the burdenof compensating oil spills between shipping and oil interests.
The International Group of P & I Clubs informed the Working Group that the P & I Clubs, with the support of
shipowners, were developing a proposal for a voluntary increase in the limit of liability for small ships under the
1992 Civil Liability Convention which would apply only in the States which ratified the proposed Supplementary
Fund Protocol. It was stated that the precise level of the increase had not yet been decided.
The Working Group decided to submit a draft Protocol on the establishment of a Supplementary Fund to the
Assembly for consideration at its October 2001 session.
The Working Group further proposed that if the Assembly approved the draft Protocol, the Assembly should
request the Secretary-General of IMO to convene a Diplomatic Conference to consider the draft Protocol
Shipowner’s liability
The Working Group examined the provisions in the 1992 Civil Liability Convention governing the shipowner’s
liability. It was considered that any attempt at this stage to include shipowners in the funding of the proposed
third tier of compensation would create complications and could result in an unacceptable delay in the setting upof the Supplementary Fund. Several options for the shipowner’s involvement in the supplementarycompensation tier were presented, namely: voluntary increase of the shipowner’s/insurer’s liability at the lower
end of the scale of liability under the 1992 Civil Liability Convention; a four layer system with an additional layerof shipowner’s liability forming the third layer and a another layer funded by oil receivers forming the fourthlayer; a third tier of compensation which would be financed both by shipowners and oil receivers; and a futurerevision of the 1992 Civil Liability Convention.
It was agreed that the issue of whether to revise the 1992 Civil Liability Convention in respect of the shipowner’s
liability would have to be considered in the longer term.

- 14 -

Environmental damage and environmental studies
The Working Group considered a proposal to introduce the concept of compensation for environmental damage
as a violation of collective property whereby compensation would be available to the State on the basis ofinternational rights under other Conventions to which it was a Party, the amount of compensation to be basedon the conclusions of environmental impact studies conducted in accordance with procedures adopted by the
1992 Fund. The Working Group also examined a proposal to change the 1992 Fund’s policy as regards
environmental damage to the effect that compensation for environmental damage would no longer be limited tocases where the claimant had suffered economic loss and to allow compensation to be calculated throughtheoretical models.
These proposals were not accepted since it was considered that they went beyond the present definition of‘pollution damage’ in the 1992 Conventions.
It was agreed that an examination should be made of what could be achieved within the present definition of‘pollution damage’ as regards the admissibility of claims for reinstatement of the environment and for cost ofenvironmental impact studies.
A proposal to address these issues in an Assembly Resolution received
considerable support.
There was also support for considering the issue of environmental damage in depth in the longer term.
Other issues
The Working Group also considered other proposals such as the possibility of developing alternative settlement
procedures, like mediation, the possible ranking of claims within the Conventions and the possibility of increasing
the limitation amount for ships of low quality or carrying cargoes representing a risk of causing serious pollution
and the weighting of contributions to the IOPC Funds according to the quality of the ships used for the transportof oil and/or the type of oil transported.
Consideration by the 1992 Fund Assembly
The 1992 Fund Assembly considered the Working Group’s report at its session held from 16 to 19 October
2001.
The Assembly adopted the draft Protocol on the establishment of a Supplementary Fund submitted by theWorking Group with some modifications. The Assembly instructed the Director to submit the text of the draft
protocol to the Secretary-General of the International Maritime Organization, requesting him to convene a
diplomatic conference to consider the draft Protocol at the earliest opportunity.
The Supplementary Fund would only pay compensation for pollution damage in States Parties to the proposed
Protocol. In view of the difficulties from a treaty law point of view which would arise if the third tier were tocontain a layer financed by the shipowners, the third tier would be financed only by the oil receivers. The
Supplementary Fund would be financed by contributions from oil receivers in the States which became Parties
to the Protocol. To ensure its optional and distinct character, the Supplementary Fund would be a separate legal
entity.
As for the issues of environmental damage and environmental studies, the Assembly considered a document
submitted by some delegations, which contained a proposal for new criteria for the admissibility of claims formeasures of reinstatement of the environment and for post-spill studies. The Assembly noted that although there
was a clear majority in favour of the proposals set out in the document, a significant number of delegations had
expressed serious doubts about the wording of the proposed criteria in respect of reinstatement measures. It
was decided that for this reason the matter should be referred back to the Working Group for further
consideration.

- 15 -

The Assembly gave the Working Group a revised mandate, namely to continue an exchange of views concerning
the need for and the possibilities of further improving the compensation regime established by the 1992 Civil
Liability Convention and the 1992 Fund Convention, including certain issues which had already been identified
by the Working Group, but not yet resolved.

Concluding remarks
The international compensation regimes established under the Civil Liability and Fund Conventions are one of themost successful compensation schemes in existence over the years. Most compensation claims have been
settled amicably as a result of negotiations.
The advantages for a State of being a Member of the 1992 Fund can be summarised as follows. If a pollution
incident occurs involving a tanker, compensation is available to governments or other authorities which haveincurred costs for clean-up operations or preventive measures and to private bodies or individuals who havesuffered damage as a result of the pollution. For example, fishermen whose nets have become polluted areentitled to compensation, and compensation for loss of income is payable to fishermen and to hoteliers at seaside
resorts. This is independent of the flag of the tanker, the ownership of the oil or the place where the incident
occurred, provided that the damage is suffered within a 1992 Fund Member State.
As mentioned above, the 1969 Civil Liability Convention and the 1971 Fund Convention have been denounced
by a number of States, and the 1971 Fund Convention will cease to be in force from 25 May 2002. Moreover,the 1992 Civil Liability Convention and the 1992 Fund Convention provide a wider scope of application on several
points than the Conventions in their original versions, and much higher limits of compensation. It is expected thatmost States which have not already done so will in the near future become parties to the 1992 Conventions.
Very often the question is made why the IOPC Funds are not prepared to accept certain types of claims. In myview this is an incorrect question. The real question is: how far are the Governments of Member States willingto put an economic burden on their oil industry. This is a political question which was answered by the
Diplomatic Conferences which adopted the Conventions.
It should also be noted that under the 1992 Conventions there is only a limited amount available for the paymentof compensation. If the 1992 Fund were to accept claims with only an indirect connection to an oil spill or claims
for general damage to the ecosystem, that could result in more directly affected victims not being able to receive
full compensation.
There has been a considerable increase in the amount of compensation claimed from the IOPC Funds over theyears. In several recent cases involving the 1971 Funds, the total amount of the claims greatly exceeded theamount of compensation payable under the 1971 Fund Convention, and the same happened or may happen in
respect of two recent cases involving the 1992 Fund. Claims have also been presented which in the Funds' view
do not fall within the definition of pollution damage laid down in the Conventions. There have also been claims
which, although admissible in principle, are for amounts which the Funds consider greatly exaggerated. As aresult the 1971 Fund and the claimants have become involved in lengthy legal proceedings. In thesecircumstances, it is becoming increasingly difficult for the Funds to achieve their aim of providing prompt
payments of admissible claims.
During the period 1978-1996, ie until the 1992 Convention entered into force, the number of 1971 Fund Member
States increased from 14 to 76. In the years since entry into force of the 1992 Protocols, the number of 1992
Fund Member States has increased from nine to 64, with 11 more States joining within the next 12 months. It
is expected that a large number of States will ratify the 1992 Protocols in the near future. It is interesting to notethat many States which have ratified the 1992 Conventions in the last few years were not previously parties tothe 1969 and 1971 Conventions. This increase in the number of Member States appears to indicate that theGovernments have in general considered the international compensation regime to be working reasonably well.
The efficient operation of the IOPC Funds has only been possible due to the strong support which theorganisations have had over the years from the Governments of Member States. The close cooperation with the- 16 -

P&I Clubs has also facilitated the operation. The IOPC Funds have also enjoyed strong support from theshipping industry and the oil industry.
Although the Conventions were revised in 1992, the main features of the regime were decided in the late sixties
and early seventies. It is not surprising therefore that the Contracting States have found that the regime needs
to be revisited for modifications in the light of experience, so as to enable the regime to adapt to the changing
needs of society and to ensure the regime's survival by remaining attractive to states.
The amendments that were adopted by the IMO Legal Committee in October 2000 are very limited, since they
relate only to increases in the maximum amount of compensation available under the 1992 Conventions.
In the context of revisiting the regime it will be important to distinguish between issues which could be dealt withwithin the framework of the 1992 Conventions (eg by agreements between contracting states, Fund Assembly
Resolutions, clarification in national law) and issues where improvements can only be brought about by formal
amendments to the Conventions through a Diplomatic Conference followed by ratification by states. If it isdecided to carry out a revision of the 1992 Conventions, it will be necessary to consider carefully which issues
should be retained for inclusion in the revision, in order to make it possible to complete the work within areasonable period of time.
***- 17 -

ANNEX IStates Parties to both the
1992 Protocol to the Civil Liability Convention and the1992 Protocol to the Fund Convention
as at 1 February 2002
64 States for which Fund Protocol is in force(and therefore Members of the 1992 Fund)
Algeria
Germany
NorwayAntigua and Barbuda
GreeceOman
Argentina
GrenadaPanamaAustralia
Iceland
Papua New Guinea
BahamasIndia
Philippines
BahrainIreland
PolandBarbados
Italy
Republic of Korea
Belgium
Jamaica
Russian Federation
BelizeJapan
Seychelles
CanadaKenya
Singapore
China (Hong Kong Special
LatviaSlovenia
Administrative Region)
Liberia
Spain
Comoros
Lithuania
Sri Lanka
Croatia
Malta
SwedenCyprusMarshall Islands
Tonga
Denmark
Mauritius
Trinidad and Tobago
Djibouti
MexicoTunisia
Dominican Republic
MonacoUnited Arab Emirates
Fiji
MoroccoUnited Kingdom
FinlandNetherlands
Uruguay
FranceNew Zealand
VanuatuGeorgia
Venezuela
11 States which have deposited instruments of accession, but for which
the Fund Protocol does not enter into force until date indicatedSierra Leone
Cambodia
TurkeyDominica
AngolaSaint Vincent and the Grenadines
Cameroon
Portugal
Colombia
Qatar
Brunei Darussalam

4 June 2002
8 June 2002
17 August 2002
31 August 2002
4 October 2002
9 October 2002
15 October 2002
13 November 2002
19 November 2002
20 November 2002
31 January 2003

States Parties to the
1992 Protocol to the Civil Liability Convention
but not to the 1992 Protocol to the Fund Convention
as at 1 February 2002
(and therefore not Members of the 1992 Fund)
5 States for which Protocol to Civil Liability Convention is in force
China

Egypt

Indonesia

Romania

Switzerland
1 State which has deposited an instrument of accession, but for which the Protocol to the Civil
Liability Convention does not enter into force until date indicated
El Salvador

2 January 2003

States Parties to both the 1969 Civil Liability Convention
and the 1971 Fund Convention
as at 1 February 2002
(and therefore Members of the 1971 Fund)
Note: the Convention will cease to be in force on 24 May 2002
24 States Parties to the 1971 Fund Convention
Albania
GambiaNigeria
Benin
Ghana
Portugal
Brunei Darussalam
GuyanaQatar
Cameroon
KuwaitSaint Kitts and Nevis
Colombia
Malaysia
Sierra Leone
Côte d'Ivoire
Maldives
Syrian Arab Republic
Estonia
Mauritania
TuvaluGabon
Mozambique
Yugoslavia
2 States Parties to the 1971 Fund Convention which have deposited
instruments of denunciation which will take effect on date indicatedDjibouti
United Arab Emirates

17 May 2002
24 May 2002

States Parties to the 1969 Civil Liability Convention
but not to the 1971 Fund Convention
as at 1 February 2002
(and therefore not Members of the 1971 Fund)
24 States Parties to the 1969 Civil Liability Convention
BrazilGeorgia
Nicaragua
Cambodia
Guatemala
Peru
Chile
Honduras
Saint Vincent and the Grenadines
Costa Rica
Indonesia
Sao Tomé and Principe
Dominican Republic
Kazakhstan
Saudi Arabia
Ecuador
LatviaSenegalEgypt
LebanonSouth Africa
Equatorial Guinea
Luxembourg
Yemen
1 State which has deposited an instrument of accession, but for which the Protocol to the Civil
Liability Convention does not enter into force until date indicated
El Salvador

2 April 2002

ANNEX II
Comparison of ‘old’ and ‘new’ regimes'Old' Regime'New' Regime

1969 CLC
SCOPE
Geographical

Territory including territorial sea

Pure threat-removal measures
Unladen tankers
SHIPOWNER'S LIABILITY
Dependent on size of tanker
Minimum for small ships
Maximum liability

FUND'S COMPENSATION
Maximum (including CLC)

INCREASING LIMITSORGANISATION

1971 FC

Not covered
Not covered

Yes
None

1992 CLC

1992 FC

Territory including territorial sea and
EEZ or equivalent, if declared
Covered if grave and imminent threat of pollution
CoveredYes
3 million SDR(US$3.8 million)
59.7 million SDR(US$74.0 million)

14.0 million SDR(US$17 million)

60 million SDR(US$74.4 million)
Requires diplomatic conference
1971 Fund

135 million SDR(US$167.4 million)
Simplified procedure established1992 Fund