The IOPC Funds – Recent Developments
Petroleum Association of JapanThe IOPC Funds
Recent developments
José Maura
Director
14 February 2020

The international liability and compensation regime
Basic principles

The international liability and compensation regime
Legal framework• 1969 Civil Liability Convention(32 Member States)

Previous regime• 1971 Fund Convention(1971 Fund dissolved in 2014)• 1992 Civil Liability Convention (1992 CLC)
(140 Member States)

Current regime• 1992 Fund Convention(117 Member States)• 2003 Supplementary Fund Protocol(32 Member States)
The numbers of Member States are correct as at 31 December 2019.
States which have deposited an instrument of accession or denunciation, but for which the Convention has not yet
entered into force or ceased to be in force, have also been included.

Member States
December 20191992 Fund Convention (117 Member States)
1992 Civil Liability Convention (140)Supplementary Fund (32)1969 Civil Liability Convention (32)States which have deposited an instrument of accession or denunciation, but for which the Convention has not yet
entered into force or ceased to be in force, have also been reflected.

How the regime works
Three Tier system
Paying organisation/Compensation regimeSource of money

Oil receivers in
Supplementary Fund
Member States

Supplementary FundContribution

Supplementary Fund Protocol
Third Tier

Fund Member States

Contribution

1992 Fund Convention
Second Tier

Shipowner

Insurance
Premium

Insurer (P&I Clubs)
1992 Civil Liability Convention

First Tier

Claimants

Oil receivers in 1992

Payment

1992 FundCompensation limits
Liability limits under the Conventions

USD 1.04 billion (£790.4 million)

USD 280.7 million (£214 million)
USD 124.4 million (£94.6 million)*Exchange rates as at 30 December 2019

Who contributes to the Funds?
Contributors• Oil cargo interests are our contributors: ‘persons’ who receive morethan 150 000 tonnes of contributing oil per year after sea transport• In the 115 Member States of the 1992 Fund, there were approximately
230 contributors in 2018.
• In the 32 Member States of the Supplementary Fund, there wereapproximately 140 contributors in 2018, including 7 States.

Contributions
Oil received by Member States’ oil industries in 2018
India 15%
Japan 12%
Republic of Korea 9%1992 Fund

Kingdom of the Netherlands 8%

1 536 586 640 tonnes

Italy 7%10 States represent 72% of contributions
43 States reported nil tonnages

Singapore 6%Spain 5%
France 4%
Thailand 3%
United Kingdom 3%
Others 28 %Japan 19%
Republic of Korea 14%
Italy 11%
Kingdom of the Netherlands 11%

Supplementary Fund
1 001 060 438 tonnes

10 States represent 84% of contributions

Spain 8%
France 6%
United Kingdom 5%
Canada 4%
Greece 3%
Turkey 3%

Tonnages reported by 31 December 2019

Others 16%

Japan and the compensation regime
Actively participating over the years•

Highest contributor from 1978 until 2016. Now second
highest contributor, receiving 186 million tonnes of oilin 2018.

•Always in attendance at meetings of the IOPC Funds,
actively contributing to debates and discussions,submitting documents•

Provided First Vice Chair of the 1992 Fund Assemblyfrom 2012 – present•

Current members of the 1992 Fund ExecutiveCommittee*Also previously elected to the Executive Committee in 1998; 2000; 2003;
2006; 2009; 2012; 2015 and 2018
*Also previously Chaired the 1971 Fund Executive Committee from 19851987•Former senior members of Japanese delegation now
working with the IOPC Funds as Legal Counsel andChair of the Audit Body

Japan and the compensation regime
Key dates and figures

Conventions Timeline:
1969 CLC
1971 Fund Convention
In force from 1978 to 2002
(1971 Fund dissolved in 2014)

1992 CLC

In force since 1996
1992 Fund Convention
In force since 1996
Supplementary Fund Protocol
In force since 20052010 HNS Protocol
Not yet in force

01/09/1976 15/05/1998
16/10/1978 15/05/1998
30/05/1996

30/05/1996

03/03/2005?

Reporting data:
Contributing oil received in
185 997 158 tonnes (12.10% of total)
2018:
Submission of oil reports
and payment ofcontributions

100%

Types of claims
What is covered

Costs of clean-up andpreventive measures

Economic losses by fisherfolk or thoseengaged in mariculture

Property damage

Economic losses in the tourism
sectorCosts of reinstatement to theenvironment

Major incidents and compensation
ExamplesAmount paid in claims including
shipowner’s contribution under 1992 CLC

250

£226m

200
£154m

150

£112m

£111m

Nakhodka (Japan,1997)

Erika (France, 1999)

100
£52m

50
0
Braer (UK, 1993)

Prestige (Spain,France and Portugal,2002)

Hebei Spirit (Korea,2007)

What has been paid
1978-2019
Supplementary Fund

• No incident• No compensation paid

The 1992 Fund

• Has been involved in 47 incidents• Paid about £410 million in compensation

The 1971 Fund

• Was involved in 107 incidents• Paid about £331 million in compensation and/or indemnification

Total• Incidents: 154• Paid about £741 million in compensation and/or indemnification

Figures as at 30 September 2019

Recent developments
Incidents drawing to a close• The CLC limit for this incident was KRW 139.4billion• Skuld paid KRW 47.4 billion in excess of itslimit• 1992 Fund paid 2 balancing payments totalling
KRW 44 billion.

• December 18 – Supreme Court awards EUR
1 439.08 million• 1992 Fund paid KRW 27.5 billion to theGovernment of the Republic of Korea inexchange for a hold harmless agreement.

• London P&I Club liable for all damages up tothe limit of its policy of USD 1 000 million• All claims settled.
• OMR 3.5 million paid by the 1992 Fund.

• 1992 Fund has paid EUR 147 million less:• The 1992 Fund continues to pursue
recovery of the compensation paid fromthe shipowner and insurer of the Nesa R3

EUR 800 000 to pay any judgments by
French courts; and EUR 4 800 to pay
Portuguese Government
Total claims paid:
99.5%

Total claims paid:
100%

Total claims paid:100%

Recent developments
Ongoing incidents• Claims office has been set up inPiraeus to handle claims• 373 claims totalling EUR
94.64 million and USD 175 000.

•

2000km of coastline affected•

Brazil is only an observer to the 1992 Fund and Supplementary
Fund•

Up to $277 million in compensation available under 1992 Fund•

$1022 million in compensation available under Supplementary
Fund.

• 312 claims have been assessedand 307 claims approved• The Fund has paid some EUR
11.27 million in compensation
to 136 claimants.

Not entitled to claim

Recent developments
Agia Zoni II incident
Ship

Agia Zoni II

Date of incident

10 September 2017

Place of incident

Saronic Gulf, Greece

Cause of incident

Sinking—circumstances under investigation(calm weather conditions, only 2 crew
members on board)

Quantity of oil
spilledUnknown but estimated to be in the regionof700 metres³

Agia Zoni II incident
Affected areas - Aerial views

Agia Zoni II incident
Before and After - Athens Riviera

Agia Zoni II incident
Before and After - Salamina island

Agia Zoni II incidentManagement of claims• Claims Submission Office opened inNovember 2017
• Staffed by manager and assistant• Assist claimants and their claims forcompensation• Assist the Secretariat with themanagement of the claims• 130+ claimants / representatives visitedthe officeAgia Zoni II incident
Claims situation as at January 2020

Claim Type

Claims received

Claims approved

Claims paid by the Fund

No. ofclaims

No. ofclaims

No. ofclaims

Amount (EUR)

Amount (EUR)

Amount (EUR)

Clean up29

83.2 million

1311.27 million

1210.81 million

Environment

5100 303

595 963495 963

Fisheries

165

6.27 million

152

38 5723837 426

Property117

904 41499

126 30966

115 672

Tourism

57

5.17 million

42417 643

25417 385Other

294 000

2000

TOTAL

375

95.74 million

319

11.95 million

145

11.48 million

Agia Zoni II incident
Current status• Investigation into the cause of incident is still ongoing• Still early to determine the overall cost of the incident• Insurance of EUR 5 million by Lodestar Marine Limited appears insufficient• 1992 Fund Assembly has approved levies:• EUR 26 million in 2018 – paid
• EUR 10 million in 2019 – invoiced• EUR 16 million in 2019 – deferred• Incident raises a number of issues:• Reliability of some insurers• Local regulations applicable to old tankers• Is the CLC/Fund system there to deal with these types of incidents?

Challenges facing the IOPC Funds
Non-IG insurers – Review by the Audit Body•

The insurance issues of Agia Zoni II & otherincidents in recent years have led todiscussions in the Assembly.

•IOPC Funds increasingly becoming involved inincidents as a result of insufficient insurance
cover•

Audit Body tasked with studying issues &presented potential measures in October 2019.

Challenges facing the IOPC Funds
Non-IG insurers – Review by the Audit Body

Problem 1:
Inconsistency between documents provided by non-IG insurers and theunderlying insurance policies.

Possible solutions:• A template of an insurance card to be furnished by non-IG insurers;• A list of non-IG insurers with whom the IOPC Funds have encountered issues inthe past on the IOPC Funds’ website; and• Member State to inform the IOPC Funds’ Secretariat of efforts to correct thesituation.

Challenges facing the IOPC Funds
Non-IG insurers – Review by the Audit Body

Problem 2:
Insolvency of the non-IG insurer.
Possible solution:
Maximise recovery in the liquidation procedure.

Problem 3:
Uncooperative action of the non-IG insurer.
Possible solution:
Develop MoU with non-IG insurers.

Challenges facing the IOPC Funds
Document submitted by India

India has submitted a document for discussion at the March
2020 meeting.
Document presents interesting points and questions some ofthe key principles of the Conventions, such as:•Coverage for all Member States without the need to makeany payment of contributions•Lack of mandatory insurance for vessels carrying less than2000 tonnes•Claims record not linked to contributions paid by aMember State

Functions of the Secretariat
Preparations for the entry into force of the 2010 HNS Convention

HNS Convention is the last gap in thecompensation regime from ship-source pollution,
providing compensation for loss or damage topersons, property and the environment arisingfrom the carriage of HNS by sea.
Tasks assigned to the IOPC Funds:• To carry out the administrative tasks for setting up
the HNS Fund• To give all necessary assistance to IMO• To make the necessary preparations for the first
Assembly of the HNS Fund

Current status of the Convention
Current status
5 contracting States:- Norway (21/4/17)- Canada (23/4/18)- Turkey (23/4/18)- Denmark (28/6/18)- South Africa (16/7/19)

4 Signatories:
France,Germany,Greece,
Netherlands

Requirements
When minimum of
12 States ratify

Protocol enters intoforce
18 months later

1. Including 4 States each with fleet
greater than 2 million gross tonnage Achieved

2. Total general account’s contributing
cargo volume at least 40 million tonnes
Source: IMO

Functions of the Secretariat
Information services, online

www.iopcfunds.org
Available in all three working languages of theFunds: English, French & Spanish
Interactive features allows users toeasily find the latest information on• Incidents (both open and closed)• Member and non-Member States• Claims and compensation
Meeting documents (past and present) available tosearch and download from Document Services
portalPublications

2018 Financial Reviews

NEW: Claims forenvironmental
damage: An overview

Available to download orin hard copy upon request

General Public Information
Website and social media

IOPC
Docs

HNS

The public website:www.iopcfunds.org

The document services website:www.iopcfunds.org/documentservices

The HNS website:www.hnsconvention.org

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