When does it enter into force?

It applies to any occurrence on or after 21 November 2008

What is its full title?

The Convention on Civil Liability for Bunker Oil Pollution Damage 2001 and it is enacted in the United Kingdom by The Merchant Shipping (Oil Pollution) (Bunkers Convention) Regulations 2006.

Why is it needed?

According to the UK P&I Club, half of all claims involving damage by pollution involved ships not carrying oil cargo at all.

Presently, however, there is no liability & compensation regime for spills of bunker oil. This Convention covers oil spills from ships other than tankers carrying bulk oil as cargo and therefore fills the gap left by the CLC & Fund Conventions but is a free standing instrument modelled on the above.

What are “bunkers” for the purposes of the Convention?”

Article 1.5 defines bunkers as any hydrocarbon mineral oil, including lubricating oil, used or intended to be used for the operation or propulsion of the ship, and any residues of such oil.

In what circumstances will the Convention apply?

When pollution damage by bunkers or residues are caused outside the ship within a State party’s:

(a) Territory

(b) Territorial Sea

(c) Exclusive Economic Zone or equivalent area; AND

When preventive measures are taken:

ANYWHERE.

What is “pollution damage?”

Pollution damage is any loss or damage caused by the contamination of bunkers. Where environmental damage claims are involved it is limited to the cost of reasonable measures actually undertaken in the reinstatement of the environment. Loss of profit from impairment is also recoverable.

What are “preventive measures?”

Preventive measures are any reasonable measures taken to prevent or minimise pollution damage and the costs of such measures are recoverable even when no spill occurs provided there was a “grave and imminent” threat of contamination. Any damage caused by preventive measures taken is also recoverable under this head.

Are any defences available to the defendant? 

Liability is strict but a defence may be available if it can be demonstrated that:

(a) The damage resulted from act of war, hostilities, civil war, insurrection or a natural phenomenon of an exceptional, inevitable or irresistible character

(b) The damage was wholly caused by an act or omission done with intent to cause damage by a 3rd party

(c) The damage was wholly caused by the negligence or other wrongful act of any Government or other authority responsible for the maintenance of lights or other navigational aids in the exercise of that function.

Can a defendant limit his liability?

All claims brought under the Convention are subject to the limitation regimes of either the Convention on Limitation of Liability for Maritime Claims 1976 (“LLMC”) or its 1996 Protocol if applicable to the State party.

Who can be liable under the Convention?

Joint and several liability will attach to any of the following parties:

(a) Shipowner

(b) Registered owner

(c) Bareboat charterer

(d) Manager

(e) Operator

Liability is also joint and several where more than one ship is involved.

Where are the claims brought?

All claims brought are subject to the exclusive jurisdiction of the affected State party. This means that the affected State party’s law governs such issues as to whether the limited defences are applicable, what constitutes “pollution damage”, the quantification of damage to the environment, the applicable limitation regime and the test for breaking limitation. A Judgment of the State party’s Court is enforceable in other Convention States.

Is there a time limit for claims?

Yes. It follows the well established liability and compensation regime under CLC i.e. the legal action must be brought within 3 years from the date when the damage occurred or within 6 years of the date of the incident which caused the damage.

Which states are a party to the Convention?

The 26 State parties as of 30 September 2008, together with the applicable limitation regime, are as follows:

Bahamas (1976)

Hungary (1996)

Samoa (1996)

Bulgaria (1996)

Jamaica (1996)

Sierra Leone (1996)

Cook Islands (1996)

Latvia (1996)

Singapore (1976)

Croatia (1996)

Liberia (1996)

Slovenia (Neither)

Cyprus (1996)

Lithuania (1996)

Spain (1996)

Denmark (1996)

Luxembourg (1996)

Tonga (1996)

Estonia (1976)

Marshall Islands (1996)

UK (1996)

Germany (1996)

Norway (1996)

Vanuatu (1976)

Greece (1976)

Poland (1976)

What does a ship need that’s new?

All seagoing ships of any kind whatsoever and greater than 1000GT that:

(a) Are registered in a State party; or

(b) Are not registered in a State party but wish to call at a port or terminal in a State party or at an offshore installation within a State party’s territorial waters

will require compulsory insurance or other financial security up to the LLMC Protocol limit together with a certificate evidencing that the above security is in place.

Who’s responsibility is it to insure the ship?

The insurance obligation is on the registered shipowner only. Nevertheless, direct action is available under the Convention against the insurer to whom limitation under the relevant LLMC is available.

My ship is registered in a State party - how is a certificate obtained?

All P&I Clubs of the International Group will issue, on application, a Blue Card to their members to evidence that the requisite insurance under the Convention is in place. This enables the State party with whom the ship is registered to issue the requisite certificate.

My ship is not registered in a State party – how is a certificate obtained?

The certificate MUST be issued by a State party to the Convention. The majority of such State parties will issue certificates to vessels calling at a port, terminal or offshore installation in their territorial waters upon production of satisfactory evidence of the requisite insurance cover being in place.

The State parties of the UK, Liberia and Cyprus have also agreed to issue certificates to ships registered in non-State parties irrespective of whether they are calling at a port, terminal or offshore installation in their territorial waters. P&I Clubs of the International Group will issue a Blue Card, on application, to their members who must stipulate the State party willing to issue a certificate to such a ship. This is because the Blue Card is addressed to the State party willing to issue certificates to non-State party’s ships.

Some State parties have entered into agreements with non-State parties to issue certificates to non-State party ships. For example, Samoa, as a State party, now issues certificates to ships registered in Hong Kong, which is not a State party.