Liability and Compensation for Oil Pollution Damage: An Examination of IMO Conventions
R. Bhanu Krishna Kiran*
Volume 3 Issue 4 (2010)
The universal regime addressing the issues of ship-source oil spill liability and compensation are primarily governed by International Maritime Organization (‘IMO’) conventions. The IMO regime imposes liability on the shipping industry based on the principle that the polluter must pay. The civil liability conventions lay down the principle of strict liability for ship owners and create a system of compulsory liability insurance. Claims for compensation for oil pollution damage (including clean-up costs) may be brought against the owner of the tanker which caused the damage or directly against the owner’s Protection & Indemnity (‘P&I’) insurer. The ship owner is normally entitled to limit his liability to an amount which is linked to the tonnage of his ship. This paper gives an overview of the international liability and compensation regime for oil pollution damage and the modus operandi to deal with the claims for compensation. This article argues that even though the conventions provide for a comparatively straightforward claims’ procedure, claimants are less likely to be able to obtain adequate compensation in the event of a catastrophic oil spill and the oil industry is thus under less pressure to prevent oil spills. However the system set up by IMO met with response to in the international community which is apparent from the adoption of the system is on the increase.