Norway First to Ratify "Polluter Pays" Treaty

Norway has become the first country to become a Contracting State to a compensation treaty covering the transport of hazardous and noxious substances (HNS) by ship.

The International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea, 2010 (HNS Convention), when in force, will provide a regime of liability and compensation for damage caused by HNS cargoes transported by sea, complementing existing regimes already in force for the transport of oil as cargo, bunker oil used for the operation and propulsion of ships, the removal of hazardous wrecks and claims for death of or personal injury to passengers, or for damage to their luggage, on ships.

The HNS Convention aims to deliver the uniform and comprehensive regime needed to provide compensation for costs, including clean-up and restoring the environment, in the event of an incident involving HNS cargoes. Total compensation available under the Convention is capped at 250 million Special Drawing Rights of the International Monetary Fund (approximately $340 million at current exchange rates) per event. 

The HNS Convention establishes the principle that the “polluter pays” by ensuring that the shipping and HNS industries provide compensation for those who have suffered loss or damage resulting from an HNS incident.

Shipowners are held strictly liable up to a maximum limit of liability established by the Convention for the cost of an HNS incident. Registered owners of ships carrying HNS cargoes have to maintain insurance that is State certified. The HNS Fund pays compensation once shipowner's liability is exhausted and is financed through contributions paid post incident by receivers of HNS cargoes.

The HNS Fund is administered by States and contributions will be based on the actual need for compensation.

HNS covered by the Convention include: oils; other liquid substances defined as noxious or dangerous; liquefied gases; liquid substances with a flashpoint not exceeding 60?C; dangerous, hazardous and harmful materials and substances carried in packaged form or in containers; and solid bulk materials defined as possessing chemical hazards.

Norway provided data on the total quantities of contributing cargo liable for contributions received in Norway during the preceding calendar year, as required by the treaty.

"The HNS Convention is the last piece in the puzzle needed to ensure that those who have suffered damage caused by HNS cargoes carried on board ships have access to a comprehensive and international liability and compensation regime," said IMO Secretary-General Kitack Lim. 

"The number of ships carrying HNS cargoes is growing steadily with more than 200 million tons of chemicals traded annually by tankers, and we have to recognize that accidents can and do happen. I urge all States to follow the example set by Norway and consider acceding to the HNS 2010 treaty as soon as possible."

Entry into force of the treaty requires accession by at least 12 States, meeting certain criteria in relation to tonnage and reporting annually the quantity of HNS cargo received in a State.

IMO, together with the International Oil Pollution Compensation Funds (IOPC Funds) and the International Tanker Owners Pollution Federation (ITOPF), has disseminated a six-page brochure that explains to States the purpose and benefit of the HNS Convention and encourages IMO Member States to take the next steps to ratify or accede to the Convention.

The brochure is available here.