IOPC Funds address risks of uninsured and unsafe ships

Published: 02 May 2024

The governing bodies of the International Oil Pollution Compensation (IOPC) Funds met from 29 April to 1 May 2024 in London to consider various ongoing issues relating to the Funds’ work, including compensation and treaty matters. BIMCO has observer status at the Funds which provide compensation for oil pollution damage resulting from oil spills from tankers and therefore play a key role in the international liability and compensation regime for oil pollution damage.

A number of important issues were discussed at this week’s meeting, including the potential impact of sanctions on the international liability and compensation regime amongst other resulting from the fact that a continuously growing fleet of tankers, mainly older ships, including some that have not been inspected recently and which have substandard maintenance, unclear ownership and lack of insurance, are being operated as a “dark fleet” to circumvent sanctions.

This led to a wider discussion about the risk of uninsured and unsafe ships and the potential impact these might have on the IOPC Funds and the wider international liability and compensation regime. Many delegations expressed serious concerns about this development and it was agreed to develop Assembly resolutions for the Funds aimed at raising awareness of the risks associated with such ships for consideration at the next session of the governing bodies in November 2024. It was also agreed that internal procedures should be developed on how to gather necessary information to determine the applicability of the Fund Conventions in such cases as well as guidance to assist member states identify ships and persons involved.

The governing bodies were also, more generally, updated on oil pollution incidents involving the IOPC Funds and activities carried out to promote and support the entry into force of the 2010 Protocol to the International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea, 1996 (the 2010 HNS Convention). To further promote ratification of the 2010 HNS Convention the Funds, together with the International Maritime Organization, organised a workshop after the IOPC Funds meeting focusing on how to ensure an efficient HNS reporting system which is key for member states to have in place before the entry into force of the convention. BIMCO strongly supports the 2010 HNS Convention which, when in force, will provide a regime of liability and compensation for damage caused by HNS cargoes transported by sea, including oil and chemicals.

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