Oil pollution victim compensation goes up under Protocol

Victims of oil pollution will receive increased amounts of compensation following Spain's ratification of the 2003 Protocol establishing an International Oil Pollution Compensation Supplementary Fund.

Having now been ratified by eight States, the fund will come into existence on 3 March 2005, and will supplement the compensation available under the 1992 Civil Liability Convention (CLC) and Fund Convention.

The total amount of compensation payable for any one incident will be limited to a combined total of 750 million Special Drawing Rights (SDR), which is equal to around US $1,152 million, including compensation paid under the existing 1992 CLC/Fund Convention.

It is expected that the increased compensation will put an end to the practice of pro-rating of payment of claims, which although often unavoidable, has led to criticisms of the previous system.

Annual contributions will be made to the fund in respect of each Contracting State by anyone that has received total quantities of oil exceeding 150,000 tonnes in one calendar year. For the purposes of the 2003 Protocol, there is a minimum aggregate receipt of 1,000,000 tonnes of each oil contribution in each Contracting State.

The Assembly of the Supplementary Fund will assess the level of contributions based on estimates of expenditure and income.

Amendments for the compensation limits established under the Protocol can be adopted by a tacit acceptance procedure, so that an amendment adopted in the Legal Committee of the International Maritime Organisation (IMO) by a two-thirds majority of Contracting States present and voting, can enter into force 24 months after compensation.

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