Developments in the CLC/Fund Conventions

Publications

Steamship Mutual

Published: August 09, 2010

December 2005

The Supplementary Fund Protocol, which provides a third tier of oil pollution compensation up to SDR 750 million (US $ 1, 084 million) payable by signatory states from a levy on oil imports, came into force on 3rd March 2005 in those 8 states that have signed the Protocol - Denmark, Finland, France, Ireland, Japan, Norway, Germany and Spain. Accordingly, STOPIA - the agreement whereby ship-owners voluntarily accept the first SDR 20 million (US $ 29 million) of any pollution liabilities irrespective of the size of the tanker - also came into force on that date. A number of other States are expected to ratify the Protocol before the end of 2005.

The future of the CLC and Fund conventions was again considered at the IOPC Fund Assembly in October. A proposal by the UK and 10 other states to instruct the Working Group to continue with a limited revision was supported by 23 states whereas the Greek proposal to terminate the mandate of the Working Group was supported by 28 states. As a result, the Assembly agreed that the Working Group would be shut down and revision of the regime would be removed from the Assembly's agenda.

The International Group's proposal to extend STOPIA to all 1992 CLC states and to put in place a mechanism to achieve an overall 50/50 sharing in the cost of all claims was accepted and was a key factor in reaching this decision. However, some states remarked that this proposal was received too late for the details to be considered fully at this meeting. The International Group was, therefore, asked to work with the IOPC Fund Secretariat and OCIMF to develop a draft agreement or agreements to facilitate 50/50 sharing overall which could be considered by the Assembly in early 2006.

In the meantime, the International Group was asked whether it was possible to put the extended STOPIA scheme into effect as soon as possible. This work is currently underway, but because of the reinsurance implications it will not be feasible to put the entire 50/50 agreement in place before 20th February 2006.

Small Tanker Oil Pollution Indemnification Agreement (STOPIA)

STOPIA 2006 and TOPIA