THIRTEENTH CONGRESS OF THE REPUBLIC 
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AN ACT 
PROVTDTNG FOR THE IMPLEMENTATION OF THE PROVISIONS OF THE 1992 
INTERNATIONAL CQNVE TION ON CIVIL LIABILITY FO 
OIL POLLUTION 
ONAL 
CONVENTION 
ON 
THE 
FUND FOR COMPENSATION FOR 
AGE, PROVIDING PENALTIE 
FOR VIOLATIONS 
ER PURPOSES 
EXPLANATORY NOTE 
The Philippines is a signatory to the 1992 International Convention on Civil Liability for 
Oil Pollution Damage and the 1992 International Convention on the Establishment of an 
International Fund for Compensation for Oil Pollution Damage. As a signatory to the said 
Conventions, it is necessary that specific guidelines will be provided for its implementation. 
Tn general terms, this bill provides a scheme of adequate compensation to victims of oil 
pollution damage and the institutional mechanism to process such claims; enables the victims of 
oil pollution damage to directly proceed against the shipowner involved in any oil pollution 
incident; imposes a system of strict but limited liability against owners of ships involved in oil 
pollution incident. 
The salient features of this bill are as follows: 
a) Imposes liability on the owner of a ship involved in an oil pollution incident which 
causes oil pollution damage. 
b) Imposes joint and several liability on the owners of two or more ships involved in an oil 
pollution incident causing pollution damage where the latter is not reasonably separable. 
c) Provides a system of strict but limited liability for oil pollution damage based on the 
vessel’s tonnage. 
d) Constitutes a Fund, which would be used to cover incidents causing oil pollution damage. 
e) Directs all owners of ships registered in the Philippines to maintain adequate financial 
security for oil pollution damage. 
f) Authorizes the .Maritime Industry Authority (MARINA) to entertain, adjudicate and settle 
actions and claims for compensation arising from oil pollution incidents. 
g) Penalizes the non-compliance with the provisions of the Act which include: failure to 
maintain financial security, failure to contribute to the International Oil Pollution 
Compensation Act; and the non-submission of the report of contributing Oil. 
Given the fact that our country is a party to the said conventions, immediate passage of 
this bill is therefore earnestly requested. 
ER 


THIRTEENTH CONGRESS OF THE =PUBLIC 
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OF THE PHTLIPPINE 
First Regular Session 
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Introduced by Senator Flavier 
AN ACT 
PROVIDING FOR THE IMBLEME TATION OF THE PROVISIONS OF THE 1992 
INTERNATIONAL CONVENTION ON CIVIL LIABILITY FOR OIL POLLUTION 
DAMAGE 
AND 
THE 
1992 
INTERNATIONAL 
CONVENTION 
ON 
THE 
ESTABLISHMENT OF AN INTERNATIONAL FUND FOR COMPENSATION FOR OIL 
POLLUTION DAMAGE, PROVIDING PENALTIES FOR VIOLATION THEREOF, AND 
FOR OTHER PURPOSES 
Re it enacted hy the Senate ai?d the House of Representatives of the Philippines in Cong-ress 
nssenzhled. 
Chapter I 
Genera1 Provisions 
Section 1. Short Title. - This Act shall be known as the “Oil Pollution Compensation Act”. 
Sec. 2. Declaration of Policy. - The State, in the protection of its marine wealth in its 
archipelagic waters, territorial sea, and exclusive economic zone, adopts internationally accepted 
measures which impose strict liability for oil pollution damage and ensure prompt and adequate 
compensation for persons who suffer such damage. This Act adopts and implements the provisions 
of the 1992 International Convention on Civil Liability for Oil Pollution Damage and the 1992 
International Convention on the Establishment of an International Fund for Compensation for Oil 
Pollution Damage. 
Sec. 3 .  Definition qf Ternw. - For the purpose of this Act: 
(a) “ 1992 Civil Liability Convention” means the 1992 International Convention on Civil 
Liability for Oil Pollution Damage; 
(b) “1992 Fund Convention” means the 1992 International Convention on the 
Establishment of an International Fund for Compensation for Oil Pollution Damage; 
(c) ‘‘MARINA” means Maritime Industry Authority; 
(d) “PCG’ means Philippine Coast Guard; 
(e) “PPA” means Philippines Ports Authority; 
(0 “Affiliate Corporation” means corporation that is owned or subject to common corporate 
control by another corporation, and operated as part of the latter’s business; 
(g) “Contributing Oil” means crude oil and fuel oil as herein defined: 
(1) “Crude Oil” means any liquid hydrocarbon mixture occurring naturally in the earth 
whether or not treated to render it suitable for transportation. It also includes crude 
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oils from which certain distillate fractions have been removed (which sometimes 
referred to RS “topped crudes”) or to which certain distillate &actions have been 
added (sometimes referred to as “spiked” or “reconstituted” crudes); and 
(2) “Fuel Oil” means heavy distillates or residues from crude oil or blends of such 
materials intended for use as fuel for the production of heat or power of a quality 
equivalent to the “American Society for Testing and Materials Specification for 
Number Four Fuel Oil (Designation D 396-69)” or heavier; 
(h) “Incident” means any occurrence or series of occurrences having the same origin, which 
causes pollution damage or creates a grave and imminent threat of causing such damage; provided 
that a series of occurrences shall be treated as having occurred on the date of the first such 
occurrence; 
(i) “Oil” means any persistent hydrocarbon mineral oil such as crude oil, fuel oil, heavy 
diesel oil, and lubricating oil, whether carried on board a ship as cargo or in bunkers of such a ship; 
(j) “Owner” means the person or persons registered as the owner of the ship or, in the 
absence of registration, the person or persons owning the ship. However in case of a ship owned by 
a State and operated by a company which in that State is registered as the ship’s operator, “owner” 
shall mean such company; 
(k) “Person” means any individual or partnership or any public or private body, whether 
corporate or not, including a State or Government or its constituent subdivisions; 
(1) “Pollution Damage” means: 
(1) Loss or damage caused outside the ship by contamination resulting from the escape 
or discharge of oil from the ship, wherever such escape or discharge may occur, 
provided that compensation for impairment of the environment other than loss of 
profit from such impairment shall be limited to costs of reasonable measures of 
reinstatement actually undertaken or to be undertaken; and 
(2) The costs of preventive measures and further loss or damage caused by preventive 
measure; 
(m)“Preventive Measures” means any reasonable measures taken by any person aRer an 
incident has occurred to prevent or minimize pollution damage; 
(n) “Ship” means any sea-going vessel and sea-borne craR of any type whatsoever 
constructed or adapted for the carriage of oil in bulk as cargo; Provided, that a ship capable of 
carrying oil and other cargoes shall be regarded as a ship only when it is actually carrying oil in 
bulk as cargo and during any voyage following such carriage unless it is proved that it has no 
residues of such carriage of oil in bulk aboard; 
(0) “State of the ship’s registry” means in relation to registered ships, the State of 
registration of the ship, and in relation to unregistered ships, the State whose flag the ship is flying; 
(p) “Subsidiary Corporation” means a corporation in which control, in the form of 
ownership of majority shares, is in another corporation, called the parent corporation. 
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Set. 4, Incorpoyafiorl of the 1992 Civil LinhilirS, Comlerztion a d  1992 Fund Convention. - 
Subject to the provisions of this Act, the 1992 Civil Liability Convention and 1992 Fund 
Convention and their subsequent amendments shall form part of the law of the Republic of the 
Philippines. 
Sec. 5. Scope of Application. - This law shall apply exclusively to pollution damage caused 
in Philippine territory, including its territorial sea and its exclusive economic zone, and to 
preventive measures, wherever taken, to prevent or minimize such damage. 
Chapter 
Strict Liability For 
il Pollution Damage 
Sec. 6. Liahi?ity or7 Po?htim Damage. - The owner of the ship at the time of an incident, or 
where the incident consists of a series of occurrences, at the time of the first such occurrence, shall 
be liable for any pollution damage caused by the ship as a result of the incident. 
Such damages shall include but not be limited to: 
(a) Reasonable expenses actually incurred in clean-up operations at sea or on shore; 
(b) Reasonable expenses of preventive measures and fkther loss or damage caused by 
preventive measures; 
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(e) Consequential loss, or loss of earnings suffered by owners or users of property 
contaminated or damaged as a direct result of an incident; 
(d) Pure economic loss, or loss of earnings sustained by persons although the property 
contaminated or damaged as a direct result of an incident does not belong to them; 
(e) Damage to human health or loss of life as a direct result of the incident; and 
(0 Environmental damages and other reasonable measures of environmental restoration. 
Sec. 7. Exemptiig Circuinstances. - No liability as stated in the immediately preceding 
section shall attach to the owner or his insurer if he proves that the damage: 
(a) resulted from an act of war, hostilities, civil war insurrection or a natural phenomenon of 
an exceptional, inevitable and irresistible character; 
(b) was wholly caused by an act or omission done with intent to cause damage by third 
party; and 
(c) was wholly caused by the negligence or other wrongfbl act of the government or other 
enforcement agencies responsible for the maintenance of lights or other navigational aids in the 
exercise of that function. 
If the owner proves that the pollution damage resulted wholly or partially either from an act 
or omission done with intent to cause damage by the person who suffered the damage or from the 
negligence of that person, the owner may be exonerated wholly or partially from his liability to such 
person. 
Sec. 8. Persons Exenzpfed from Clninw for Conzpemntion for Pollution Damage. - No claim 
for compensation for pollution damage under this Act may be made against: 
(a) The servants or agents of the owner or the members of the crew; 
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(b) The pilot or any other person who, without being a member of the crew, performs 
services for thc ship; 
(c) Any charterer - howsoever described, including a bareboat charterer - manager or 
operator of the ship; 
(d) Any person performing salvage operations with the consent of the owner or on the 
instructions of a competent public authority; 
(e) Any person taking preventive measures; and 
(0 All servants or agents of persons mentioned in paragraphs (c), (d) and (e) hereof, unless 
the damage resulted from their personal act or omission, committed with the intent to cause such 
damage, or committed recklessly and with knowledge that such darnage would probably result. 
Provided, that nothing in this Act shall prejudice any right of recourse of the owner against third 
parties. 
Sec. 9. Joint and Several Liabilio?. - When an incident involving two or more ships 
occurs and pollution damage results therefrom, the owners of all the ships concerned, unless 
exonerated under Section 7, shall be jointly and severally liable for all such damage which is not 
reasonably separable, without prejudice, however, to the right of recourse of any of such owners to 
proceed against each other or third parties. 
Chapter 111 
System of Limitation of Liability 
Sec. 10. Liniitntion qf Liabiliv - The owner of a ship shall be entitled to limit his liability 
under this Act with respect to a particular incident to a total amount calculated as follows. 
(a) Three million (3,000,000) units of account for a ship not exceeding 5,000 units of 
tonnage; 
(b) For a ship with a tonnage in excess thereof, for each unit of tonnage, four hundred 
twenty (420) units of account for each unit in addition to the amount mentioned in par. (a). 
Proiided, however, that this aggregate amount shall not, in any event, exceeds 59.7 million 
units of account. Provided.fiirther, that the limit of liability of the owner of a ship as 
aforementioned shall be subject to adjustment according to subsequent amendments of the 1992 
Civil Liability Convention. 
The limited liability under this section may not be availed of by the owner if it has been 
established that such pollution damage resulted from his persona1 act or omission, committed with 
intent to cause such damage, or committed recklessly and with knowledge that such damage would 
probably result. 
The “unit of account” referred to in this section is the Special Drawing Right as defined by 
the International Monetary Fund as so set forth in the 1992 Civil Liability Convention. The 
abovesaid amount shall be converted into national currency on the basis of the value of the currency 
by reference to the Special Drawing Right on the date that the fund is constituted under Sec. 1 I of 
this Act. 
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Sec. 11. Constitution of a Fmd. - For the purpose of availing himself of the benefit of 
limitation provided for under Section 10 of this Act following the occurrence of a particular 
incident, the owner of ship registered in the Philippines shall be required to constitute a fund for the 
total sum representing the limit of his liability with the MARINA to cover incidents causing oil 
pollution damage, and against which a claim for pollution damage may directly be brought. 
The fund can be constituted by depositing the sum or by producing a bank guarantee or 
other financial guarantee acceptable under existing laws and considered to be adequate by the 
MARINA. 
Chapter w 
System of Compulsory Insurance and Certification 
Sec. 12. Maintenance qf Conplso1-y Insurance or other Fimncial Security. - All owners of 
ships registered in the Philippines shall be required annually by the MARINA to maintain insurance 
or other financial security for pollution damage in the sums fixed by applying the limits of liability 
under Sec. 10 of this Act. 
Sec. 13. Lsnmice ufn Cer@cnte. - A certificate attesting that insurance or other financial 
security is in force in accordance with the provisions of this Act shall be issued to each ship 
carrying more than 2,000 tons of oil in bulk as cargo by the MANNA. With respect to a ship not 
registered in a convention-member state, such certificate may be issued or certified by the 
MARINA. This certificate shall be in the form established by the 992 Civil Liability Convention 
and shall contain the following particulars: 
(a) Name of ship and port of registration; 
(b) Name and principal place of business of the owner; 
(c) Type of security; 
(d) Name and principal place of business of the insurer or other person giving security and, 
where appropriate, place of business where the insurance or security is established; and 
(e) Validity period of the certificate which shall not be longer than the period of validity of 
the insurance or other financial security. 
Sec, 14. Enforcement. - Ship carrying more than 2,000 tons of oil in bulk as cargo shall not 
be allowed entry into Philippine territory or its exclusive economic zone without a valid certificate 
of insurance or financial security for oil pollution damage required by this Act. For this purpose, the 
PPA or any other port authorities shall deny port services to said ship without such certificate. 
If any such ship is found within the said territory or zone without such certificate, said ship 
shall be prevented from loading or unloading its cargo until it is able to produce the appropriate 
insurance or financial security duly certified by the state of its registry if such country is a 
convention-member state, otherwise, issued or certified by the MARZrJA or any convention- 
member State. 
The owner and master of the ship referred to in the immediately preceding paragraph shall 
be jointly and severally liable to the fines set forth in this Act. Such ship shall be prevented from 
leaving unless the appropriate fines shall have been paid to the full satisfaction of the MARTNA. 
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The PCG shall conduct inspections of certificates of ships entering the territory of the 
Philippines, or,' 
in the case of ships registered in the Philippines, voyaging within the said territory, 
provided, that such inspections shall not cause undue delay to the ships. 
Chapter 
Contribution to the International Oil Polliition Compensation Fund 
Sec. 1 5. Contributions to the brterimfiormai Oil Poiirttiofi Compensation Fzi17d. - Any person 
who has received more than one hundred fifty thousand (150,000) tons of contributing oil in a 
calendar year in all ports or terminal installations in the Philippines through carriage by sea, shall 
pay contributions to the International Oil Pollution Compensation (IOPC) Fund in accordance with 
the provisions of the 1992 Fund Convention. 
A person shall be deemed to have received contributing oil, for contribution purposes, if he 
received the same: 
(a) From another country; or 
(b) From another port or terminal installation within the Philippines, notwithstanding that it 
had already been previously received by him. 
Where the quantity of contributing oil received by any person in the Philippines in a 
calendar year, when aggregated with the quantity of contributing oil received in the Philippines in 
that year by its subsidiary or affiliate corporation, exceeds one hundred fifty thousand (150,000) 
tons, said person, including its subsidiaries, shaI1 pay contributions in respect of the actual quantity 
received by each, notwithstanding that the actual quantity received by each did not exceed 150,000 
tons. 
Sec. 16. HLym*tiiig of( 'o/itrif?iiiitg Of/ - Any person who, in a calendar year, has received in 
the territory of the Philippines contributing oil, as defined in this Act, shall, not later than 1 
February of the following year, report to the MARINA the quantity of such oil received. The 
MARINA, through the Department of Foreign Affairs, shall communicate the data at a time and in 
the manner prescribed by the 1992 Fund Convention. 
Action for ~ompensat~on 
Sec. 17. Actionfiir Conzpeizscttion. - An action for compensation on account of pollution 
damage resulting from the incident which occurred in the territory may be brought before the 
MARINA against the following persons: 
(a) owner of the polluting ship; or 
(b)insurer or other person providing financial security of the said owner's liability for 
pollution. 
For this purpose, foreign corporation, partnership, association, or individual, whether or not licensed 
to transact business in the Philippines by any appropriate government agencies, providing such 
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insurance or financial security for pollution damage shall be considered transacting or doing 
business in the Philippines and shall be subject to the jurisdiction of MAFtINA.” 
Such action shall be filed within three (3) years of the date on which the damage occurred, 
but not later than six (6) years of the date of the incident. 
For this purpose, the MARINA shall promulgate the procedure for the adjudication or 
settlement of claims and for the execution of the same. 
Sec. 18. Adjjlidiication or Settlement of Clninzs. - The MARINA shall decide claims for 
compensation, or certify the compromise agreement by the parties within a reasonable period. 
Where the fhnd under the 1992 Civil Liability Convention is insufficient to satisfy the 
claims of those who are entitled to compensation, the amount of compensatioii of each claimaizt 
shall be distributed pro rata. 
Where compensation was not obtained or satisfied under the 1992 Civil Liability 
Convention, the claimant may seek compensation under the 1992 Fund Convention. The MARINA 
shall furnish the lOPC Fund with its certified decision, together with pertinent documents, on a 
claim for pollution damages. 
The decision of MARINA shall be appealable to the Court of Appeals. 
Sec. 19. Intemntio?z by the IOPC Fmd. - The IOPC Fund may intervene as a party to any 
legal proceedings instituted against the owner of a ship or his guarantor under Article IX of the 
1992 Civil Liability Convention. 
Chapter VPI 
Penalty Provisions 
Sec. 20. Vi’iolafions of 
fhe Act. - The following acts shall be considered violations of the Act 
and the persons responsible shall suffer the corresponding fines: 
(i) Any person who fails to institute or maintain insurance of other financial security required under 
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Sec. 12 of this Act; 
(a) Ships of 500 gross tons (GRT) and below - Not less than Fifty Thousand 
(P50,OOO.OO) but not more than Two Hundred Thousand Pesos (P200,OOO. 00); 
(b) Ships of above 500 to 1,000 GRT- Not less than Two Hundred Fifty Thousand 
(P250,OOO.OO) but not more than Five Hundred Thousand Pesos (P500,OOO.OO); 
(c) Ships of above 1,000 to 5,000 GRT - Not less than Five Hundred Thousand 
(P500,OOO.OO) but not more than One Million Pesos (P1,000,000.00); 
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Pesos 
Pesos 
Pesos 
(d) Ships of above 5,000 to 10,000 GRT - Not less than One Million Pesos (P1,000,000.00) 
but not more than Five Million Pesos (P5,000,000.00); 
(e) Ships of above 10,000 to 20,000 GRT - Not less than Five Million Pesos 
(P5,000,000.00) but not more than Ten Million Pesos (P10,000,000.00); and 
(f) Ships of 
above 
20,000 GRT and above - Not less than Ten Million Pesos 
(P10,000,000.00) but not more than Fifteen Million Pesos (P15,000,000.00). 
(ii) The owner and the master of a ship who operate a ship without maintaining on board a 
certificate of insurance required under Section 23 of this Act; 
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(a) First Violation 
- Five Hundred Thousand Pesos (P500,OOO.OO); 
(b) Secund Violation - One Million Pesos (P1,000,000.00); and 
(c) Third Violation 
- One Million and Five Hundred Thousand Pesos (P1,500,000.00). 
(iii) Any person required under Sec. 15 of this Act to contribute to the International Oil Pollution 
Compensation Fund but nevertheless fails to comply therewith after due notice by the MARINA; 
(a) First Violation 
(b) Second Violation - Four Million Pesos (P4,000,000.00); and 
(c) Third Violation 
- Three Million Pesos (P3,000,000.00); 
- Five Million Pesos ~5,000,000.00). 
(iig Failure to Submit Report of Contributing Oil. - Any person required under Sec. 16 of this Act 
to submit report of contributing oil and notwithstanding 10-day notice thereto, fails to comply 
therewith; 
(a) First Violation 
(b) Second Violation 
(c) Third Violation - One Million and Five Hundred Thousand Pesos (P1,500,000.00). 
The fines prescribed in this section and other sections of this Chapter shall be increased by 
at least ten percent (10%) every three (3) years to compensate for inflation and to maintain the 
deterrent function of such fines. 
- Five Hundred Thousand Pesos (P500,OOO.OO); 
- One Million Pesos (P1,000,000.00); and 
Sec. 2 1. Zmtitrdiomd Meclmnisin - The MARINA shall be the lead implementing agency 
unless otherwise provided in this Act. 
Final Provisions 
Sec. 22. Oil Polhition Mnlingemeizt Fwd. - An Oil Pollution Management Fund to be 
administered by the PCG is hereby established. Said fbnd shall be constituted from fines imposed 
pursuant to this Act, from grants, donations, endowment from various sources, domestic or foreign, 
and amounts specifically appropriated for Oil Pollution Management Fund under the annual 
General Appropriations Act. 
The fund shall be used to finance the following activities: 
(a) Containment, removal, and clean-up operations of the PCG in all oil pollution cases, 
whether covered by this Act or not; and 
(b) Research, enforcement and monitoring activities of relevant agencies such as the PCG, 
MARINA and PPA and other ports authority of the Department of Transportation and 
Communications, Environmental Management Bureau of the Department of Environment and 
Natural Resources, and the Department of Energy. 
Provided, that ninety percent (90%) of the finnd shalf be maintained annually for the activities set 
forth under item (a) of this paragraph. Pmvided, jinther, that the amounts specifically appropriated 
for said hnd under the General Appropriations Act shall be used exclusively for the activities set 
forth under item (a) of this paragraph. 
In no case, however, shall the fbnd be used for personal services expenditures. 
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SEC. 23. Appropriations. - The Secretary of the Department of Transportation and 
Communications shall include in the Department's program the implementation of this Act, the 
funding of which shall be included in the Annual General Appropriations Act. 
Sec. 24. Iinplenzentiiig Rilles atid Regiilutions. The MARINA, in coordination with other 
concerned agencies and sectors, shall, within six (6) months after the effectivity of this Act, 
promulgate rules and regulations for the effective implementation of this Act. A manual providing 
for the procedures concerning the enforcement of claims under this Act shall, likewise, be 
developed within the said period. 
The said rules and regulations and manual shall be published in a newspaper of general 
circulation also within the said period. 
Sec. 25. S'epurabilify Clairse. In the event that any provision of this Act is declared 
unconstitutional, the validity of the remainder shall not be affected thereby. 
Sec. 26. Repenling Clcriise. All laws, decrees, rules and regulations and executive orders 
contrary to or inconsistent with this Act are hereby repealed or modified accordingly. 
Sec. 27. &feeCtivify Cluiise. This Act shall take effect after the completion of its publication 
made once a week for three (3) consecutive weeks in at least two (2) newspapers of general 
circulation. 
Approved. 
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