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The CLC/FC Regime

The CLC/FC Regime. An Introduction to the key issue of a possible revision to the International regime for the liability and compensation for oil spills (CLC/FC 92) Presented by John C. Fawcett-Ellis General Counsel & Regional Manager Asia-Pacific Hong Kong (SAR – China), 25 February 2005.

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The CLC/FC Regime

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  1. The CLC/FC Regime An Introduction to the key issue of a possible revision to the International regime for the liability and compensation for oil spills (CLC/FC 92) Presented by John C. Fawcett-Ellis General Counsel & Regional Manager Asia-Pacific Hong Kong (SAR – China), 25 February 2005

  2. The Current regime • CLC 92 • FC 92 • Supplementary Fund 2003 – enters into force 3 March 2005 • Key features - Channeling of liability to reg’d owner - Strict liability - Owner’s liability insured through P&I cover - If cost of spill exceeds CLC limits then Fund set up by receivers - Owner’s right to limit liability is lost if it is proved that the spill was caused by “his personal act or omission, committed with intent to cause such damage, or recklessly and with knowledge that such damage would probably result”

  3. How the regime has already been revised/updated: • 50% increase in limits under CLC and FC • Third tier of compensation introduced ”The Supplementary Fund” – will enter into force on 3 March 2005 • STOPIA – voluntary increase in small ships limit under CLC

  4. Success of the current regime: • Some 90 states signed up to CLC/FC – truly international • Protects the victims of oil spills • Merit of simplicity • 90% of claims paid out by owners irrespective of fault • Sharing of the cost of spills equally between owners and receivers

  5. The current debate • Should a new regime be devised? • The perception that the SF will upset the equitable sharing in the cost of spills • Addressing the issue of sub-standard shipping

  6. INTERTANKO’s Position • NO REVISION - Current regime operates well from the perspective of oil spill victims • Any new regime would result in increases in liability for owners and also possibly receivers, charterers? & producers? • Sub-standard shipping - Support the IG’s initiatives – but do not support the initiative of an IOPCF WG – this is IMO territory

  7. INTERTANKO’s position (cont.) • Sharing: Support STOPIA or a Sharing in the SF but not at the 50:50 level proposed by the IG • Understand the need for a regular review

  8. Reminder of discussions at Oct 04 IOPCF meetings • Assembly divided on the issue of revision • March (14-23) 05 WG – It was agreed that the WG cannot have an indefinite life – must decide on concrete proposals to put to the Oct 05 Assembly meeting or else recommend the WG dissolves • Non-revisionists: 15 states • Revisionists: 12 states • Evaluating position: 7 states • Many states did not voice an opinion

  9. States that are against revision: • Republic of Korea • Singapore • Greece + Malta + Cyprus • Russian Federation • The Philippines • Malaysia? • Hong Kong (SAR – China)

  10. States that are against revision (Cont.): • Panama + Liberia + Vanuato • Tunisia • Trinidad & Tobago • Mexico • Norway ?

  11. The IOPCF WG – March 05 It is crucial that as many states as possible say ”We support the existing regime - no further revision”

  12. Thank youwww.intertanko.com

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