China Sets Up Oil Spill Fund
China has established a national compensation fund for oil spills caused by ships.
"This marks a new milestone for China's compensation mechanism for ship-caused oil pollution and will better safeguard the interests of the victims of accidents," said He Jianzong, deputy transport minister, at the inauguration ceremony, reports Want China Times.
China’s oil consumption rose to a record high of 374.6 million tons in 2014 leading to an increase in tanker operations and subsequent risk of a spill in Chinese waters. Local media reports indicate that between 1973 and 2014, 3,200 oil spill accidents occurred in the seas around China resulting in 42,936 tons of spilt oil.
Shipowners are currently required to have liability insurance. However, compensation limits have meant that victims were not always compensated adequately and environmental remediation has not always been possible, said He.
The Ministry of Transport currently manages compensation and is currently processing 14 cases worth around $26 million.
The new multi-government-department controlled fund, established within China’s Marine Environment Protection Law and estimated to exceed $50 million, will be contributed to by shippers and shipowners.
Both local and foreign shipowners have been lobbying China for clearer direction and more transparency in the management of claims.