Legal Committee (LEG), 94th session: 20-24 October 2008
in developing new draft HNS Protocol
The Legal Committee of the International Maritime Organization (IMO) made
significant progress in developing a new draft Protocol to the 1996 HNS Convention
(the International Convention on Liability and Compensation for Damage in Connection
with the Carriage of Hazardous and Noxious Substances by Sea), when it met for
its 94th session.
There was broad agreement in principle on the need for a draft Protocol, however
Member States agreed more time was needed to consider the draft and that this
should take place at the next session of the Legal Committee (April 2009).
The new draft
Protocol is designed to address practical problems that have prevented many
States from ratifying the Convention which, despite being adopted in 1996, has,
to date, only 13 ratifications and has not yet met its entry into force criteria.
HNS Convention was based on the highly successful model of the Civil Liability
and Fund Conventions. Like those instruments, it sought to establish a two-tier
system for compensation to be paid in the event of accidents at sea, in this
case involving hazardous and noxious substances, such as chemicals. Tier one
would be covered by compulsory insurance taken out by shipowners, who would
be able to limit their liability; compensation claims over that amount (i.e.
tier two) could be paid from a fund, made up of contributions from the States
Party to the Convention. Contributions would be calculated according to the
amount of HNS received by each State.
among the obstacles that have discouraged ratification of the Convention, one
of the most difficult to overcome has been the requirement for States to declare
the quantities of HNS received. The sheer range and diversity of hazardous and
noxious substances that will be governed by the HNS Convention has made this
a complex issue that is hard to resolve in practical terms. The draft Protocol,
which was developed by a focus group established by the 1992 IOPC Fund Assembly,
is intended to address this problem, as well as others thought to be acting
as barriers to ratification of the Convention.
The IMO Legal
Committee invited Member States to give further consideration to the issue with
a view to finalizing the draft Protocol at the next session.
It has been widely recognized that three issues have been instrumental in preventing
states from ratifying the HNS Convention. The new draft Protocol addresses each
of them, as follows:
1. Problem: Setting up the reporting system for packaged goods was deemed
to be too complicated for States to implement.
solution: Packaged goods have been excluded from the definition of contributing
cargo and will not be liable for contributions to the HNS Fund. However, since
incidents involving packaged goods will remain eligible for compensation by
the HNS Fund, which will therefore be paid for by receivers of bulk goods, the
shipowner's limit of liability for incidents involving packaged HNS would be
increased to reduce the number of incidents involving the HNS Fund.
For LNG, under the 1996 HNS Convention, the person liable for contributions
is the titleholder immediately prior to discharge rather than the receiver.
While the receiver must be subject to the jurisdiction of a State Party, the
titleholder need not be. It would therefore have been impossible to enforce
payment of contributions to the LNG account by titleholders in non-State Parties.
Proposed solution: Under the draft Protocol, the receiver, as defined
in Article 1.4 of the Convention, would now be liable for annual contributions
for LNG, except where the titleholder pays them following an agreement with
3. Problem: There have been ongoing problems with submission of reports
of contributing oil to the IOPC Funds and very few States have submitted reports
of contributing cargo when ratifying the HNS Convention. However, non-submission
of reports results in non-payment of contributions but not in withholding of
Proposed solution: The draft Protocol would deal with this in three ways.
to ratify the Draft Protocol, a State must submit reports on contributing cargo.
IMO would not accept any ratifications which are not accompanied by such reports.
The State must continue to submit reports annually thereafter until the Draft
Protocol enters into force.
If a State
fails to submit reports after ratification, the State would be temporarily suspended
from being a Contracting State. The Draft Protocol would therefore not enter
into force for any State which is in arrears with reports.
Draft Protocol has entered into force for a State, compensation would be withheld,
temporarily or permanently, in respect of that State if it is in arrears with
reports, except in the case of claims for personal injury and death.
Compensation regarding Claims for Death, Personal Injury and Abandonment of
The Legal Committee took note of the reports of the seventh and eighth sessions
of the Joint IMO/ILO Ad Hoc Expert Working Group on Liability and Compensation
regarding Claims for Death, Personal Injury and Abandonment of Seafarers, and
approved the terms of reference for the ninth session of the Joint Working Group,
scheduled to take place from 2 to 6 March 2009, at the Headquarters of ILO,
in Geneva. In particular, the group is tasked with agreeing on principles to
facilitate the drafting of mandatory provisions for inclusion in an appropriate
instrument or instruments.
relating to financial security to cover claims from seafarers in cases of abandonment,
personal injury and death were adopted by the IMO Assembly in November 2001
and the joint group has been monitoring the problem of abandonment of crew members/seafarers
to the Legal Committee expressed their support for the development of draft
mandatory provisions on abandonment of seafarers, with the form of such an instrument
to be decided at a later stage.
It was emphasized
that abandonment was a real problem, with humanitarian dimensions, and could
become more frequent as a consequence of the negative impact on the shipping
industry of the global financial crisis. It was important to find a solution,
not only for humanitarian reasons, but also for the efficiency of the industry
as a whole.
model insurance certificate
Entry into force will occur 18 months after the following conditions have been
The Committee discussed the development of a model for a single insurance certificate,
which may be issued by States Parties in respect of each and every ship under
the relevant IMO liability and compensation conventions.
general consensus that a single insurance certificate would be desirable, since
it could lead to a reduction in the administrative burden of States and shipowners/insurers
when compared with the system prescribed by the various conventions.
decided to establish an informal correspondence group in order to progress intersessionally
on the legal, technical and practical aspects of the consolidated model certificate,
including issues relating to port State control and inspection.
agreed to retain this item on its agenda for its next session and noted that
any decision whether to pursue the issue of the single insurance certificate
would be taken on the basis of the work produced by the correspondence group.
States have accepted the Convention, four of which have not less than two
million units of gross tonnage; and
Provided that persons in these States who would be responsible to pay contributions
to the general account have received a total quantity of at least 40 million
tonnes of contributing cargo in the preceding calendar year.