The use of Autonomous Marine Vehicles (AMVs) is becoming increasingly common in the oil and gas industry for exploration initiatives. They have also been used for military purposes, as well as oceanographic and geological research. With their increasing popularity and presence, the question which arises from both a legal and insurance perspective is where AMVs fit into the pre-existing legal framework. This is of particular importance for the purposes of determining operators’ ability to limit their liability and get cover for their risk.
AMVs are unmanned, submersible crafts, which are not mechanically linked to an operational station, capable of on board decision making. The level of autonomy of the AMV depends on its function.
For the purposes of English Law, the ability of an AMV operator to limit their liability will depend on whether or not the AMV, on the basis of its individual characteristics, can be considered as a “ship” for the purposes of Section 313 of the Merchant Shipping Act 1995. It is unlikely that AMVs will qualify as ships under the MSA or most existing international maritime, conventions, and as such will generally be unable to limit their liability.
In addition, historic provisions allowing the Secretary of State the power to determine whether or not a craft was a ship, even if it may not have naturally been categorised as one, have now been repealed. This raises the difficulty as to how operators can commercially allocate the risk inherent in operating the AMVs and how that risk can be quantified.
One way of doing this is by ensuring that an operator is contractually indemnified for any liability arising out of any commissioned operations, therefore limiting the scope of the risk.
It is also important to ensure that the AMV operator utilises an appropriate company structure to limit the level of liability to the value of the assets owned by the company. However, if there is a large scale incident, it may be difficult from a political and commercial perspective for larger operators, who operate other businesses in the affected jurisdiction, to avoid liability in this way.