In early December, the Canadian government announced that Canada has signed the Convention on Supplementary Compensation (CSC), bringing the convention closer to fruition. The CSC is an international instrument that would establish a global nuclear liability regime with consistent application of key principles of nuclear liability. Any country may adopt the CSC — even if the country is not a party to an existing nuclear liability conventions (e.g., the Paris or Vienna Conventions) so long as certain conditions are met. The CSC does not enter into force until at least five States with a minimum of 400,000 units of installed nuclear capacity have ratified the CSC. To date, the U.S. is the only country with substantial nuclear capacity to have ratified the CSC.
In order to ratify the CSC, Canada must now update its national nuclear liability legislation to ensure consistency with the uniform rules for nuclear liability in the CSC Annex. Under draft legislation that is expected to be proposed later this year, civil liability for nuclear damage in Canada will increase from the current level, $75 million in Canadian dollars, to $1 billion in Canadian dollars. The legislation would apparently broaden the availability of compensation by, for example, permitting claims for mental anguish and extending the statute of limitations for bringing claims from 10 years to 30 years. Both provisions would be somewhat unusual in that most insurance policies around the world that cover nuclear liability exclude such claims. To get a sense of the potential scale of the coverage, payouts for mental anguish following Fukushima account for approximately half of the total — though, to be clear, there is not necessarily an equivalency between the scope of that claim category in the two countries. And, insurance premiums necessary to cover claims filed between 10-30 years after an accident may make insuring such claims impractical without some government support.
What comes next for the CSC? Will the momentum continue? Clearly, the Fukushima accident has served as catalyst for reinvigorated efforts to establish a global nuclear liability regime. As we discussed in a September post, France and the U.S. have issued a joint statement on nuclear liability that emphasizes areas of agreement with respect to nuclear liability, though France has stopped short of joining the CSC. And, in a November post, we highlighted reports from Japan indicating that the government there intends to propose ratification of the CSC. If Japan and Canada ratify the CSC, that would leave just two major nuclear countries outside an international liability convention: South Korea and China. The U.S. either is currently or soon will be negotiating Section 123 agreements for civilian nuclear cooperation with both countries. Could the CSC start to look like the Pacific Rim’s answer to the Paris Convention?