press release
OIL POLLUTION VICTIMS SHORT-CHANGED
AGAIN?
London (UK) October 24 -Victims of oil
disasters, including those affected by the
Prestige spillage, will find out today
whether they will get full compensation
immediately or have to wait potentially years
for a future date for full payment.
Tourism and fishing industries were badly
hit by the Prestige disaster [1] , however
those affected are currently only receiving
compensation at 15% of their losses. Today's
decision by Member States of the
International Oil Pollution Compensation
Funds will come as the environmental charity,
Friends of the Earth, renews its call for
company directors to be held liable for
damages.
In Britain Friends of the Earth, with
allies in the CORE Bill coalition, is
pressing for changes in UK company law to
make directors liable for damage caused
anywhere in the world. This would allow
victims of oil pollution created by British
companies, or companies with British
directors, to seek compensation in the
UK.
Notes for Editors:
The compensation funds were set up for
victims of oil pollution disasters by
Governments though the UN. However victims of
the Prestige, which sank off Spain last year,
and other disasters may face a long wait for
their money:
• Payments for losses from the Prestige
disaster are currently being paid at 15% of
their total value, as the total amount
payable from the Funds has been limited to
£123 million .
• Payments to Venezuelan fisherman for
losses suffered from the Nissos Amorgos in
1997 were only being made at 40 per cent of
their value till this July and are still
limited to 65 per cent .
• Victims of the Erika, which broke in two
on 12 December 1999, only heard that their
claims would be fully met in April this year.
365 victims with claims worth £18 million
were still waiting, as of 10 October 2003,
for news on whether their claims would be
paid .
• Pakistani fishermen suffering losses as a
result of the Tasman Spirit this August may
get no compensation at all as their
Government is not a member of the Funds.
International Oil Pollution Compensation
Funds (IOPC Funds) The International Oil
Pollution Compensation Funds (IOPC Funds)
were set up through the 1969 International
Convention on Civil Liability for Oil
Pollution Damage and the 1971 International
Convention on the Establishment of an
International Fund for Compensation for Oil
Pollution Damage.
The Conventions limit the liability of
ship owners for the losses caused by oil
pollution episodes but provide compensation
for victims in countries who have joined the
Fund. Compensation is paid by importers of
oil in Member States in proportion to the
amount of oil they import.
There are currently two IOPC Funds, set up
in 1971 and 1992. They have different members
and different rules. Over time, as more
members have joined the 1992 Fund, it has
largely superseded the 1971 Fund. The 1971
Fund is therefore being wound down and now
will only settle payments for certain
incidents that have already happened – such
as the Nissos Amorgos. A new supplementary
fund is likely to be set up in the near
future. Its aim will be to provide extra
compensation to victims of future spills in
member countries who have paid into the
supplementary fund . Recently, after a
decision by its Members, the Fund Secretariat
has begun to pursue agencies that it believes
are at fault for oil pollution disasters.
Earlier this week, it announced it had
reached an out-of-court settlement with the
Milford Haven Port Authority over
compensation paid to victims of the Sea
Empress disaster in Pembrokeshire in 1996 .
This raises the possibility that the Fund may
seek recompense from the Spanish or
Gibraltarian authorities – both of whom have
accused of failures in respect of the
Prestige.
For more information contact
Friends of the Earth in London:
Roger Higman +44-207 566 1661 Mobile:
+44-7780 661 807 or +44-20 7566 1649 Email :
press@foe.co.uk
More at www.foe.co.uk
For CORE please contact Brian Shaad +44-20
7566 1665 Mobile: 07 930 453 728
[1] The Prestige
On 19 November, 2003, the Prestige sank off
the coast of Galicia in north west Spain. It
had been leaking oil for six days having been
damaged in heavy seas. Slowly over the weeks
and months afterward more and more of the
77,000 tonnes of heavy fuel oil it contained
leaked to pollute the coasts of Portugal,
Spain and France.
The Prestige’s sinking threw light, yet
again, on the failure of Governments to
regulate international shipping and the
complex web of ownership arrangements set up
by oil and shipping companies which impedes
regulation of their operations. The ship was
registered in the Bahamas (whose shipping
agency is based in London) but owned by a
Liberian company, Mare International, which
itself was reputedly owned by the Greek
Coulouthros shipping dynasty. The oil it
carried was owned by Crown Resources, a Swiss
company owned by the Russian Alfa Group, but
operated from the west end of London.
The Nissos Amorgos
On 28 February, 1997, the Greek-owned Nissos
Amorgos fractured its hull in Lake Maracaibo,
an almost completely enclosed bay in western
Venezuela. The Lake is used by about 130
tankers a month and has repeatedly suffered
from oil spills . On 15th May, 1997, hundreds
of fishermen blocked the entrance to the lake
in an action they described as the ‘Third
Battle of Lake Maracaibo’.
The Erika
The Maltese-registered, Erika, broke in half
70 miles south west of Brest, Brittany on 12
December 1999 while carrying oil for the
French company TotalFinaElf. Some 19,800
tonnes of fuel oil were spilled polluting 400
kilometres of the French coast . Following
pressure from the French Government,
TotalFinaElf offered to pay about £4m for the
clean-up and about £40m to pump out oil
remaining in the boat, but compensation
payments have been left to the Ship's insurer
(up to £8.4 m) and the Funds (£109m) .
The Tasman Spirit
The Maltese-registered Tasman Spirit was
grounded of Karachi, Pakistan in August, 2003
while carrying oil for the Pakistan National
Shipping Corporation. About 28,000 tonnes of
crude oil spilled from the tanker and
polluted local beaches. Pakistan is not a
member of the International Oil Pollution
Compensation Funds but is reported to be
seeking compensation from Polembros, the
boat's Greek owners .
The polluter must pay
Friends of the Earth believes there are
fundamental flaws in the regime set up by
Governments to compensate the victims of oil
pollution disasters.
• Victims are often forced to wait years
for payment
• Victims are only protected by the Funds if
their Government has had the foresight to
join.
• Oil companies have no individual direct
liability for pollution caused by ships they
charter, although they pay collectively for
the damage their oil causes in countries
which are Members of the Funds.
As a result, companies have little incentive
to ensure that the ships they use meet the
highest design and maintenance standards.
Governments in northern countries are
attempting to rectify the system's failures
by instituting a supplementary fund to pay
higher compensation for pollution in Member
countries and by instituting regional
regulations on shipping entering their
waters. However, the fundamental problems of
the system go unaddressed. The lax regime for
regulating shipping, through the IMO, is
being allowed to continue and nothing is
being done to put direct liabilities on
Directors of companies found responsible for
causing the pollution.
The Corporate Responsibility (CORE)
Coalition was formed in response to the
Government's failure in the Modernising
Company Law White Paper to specify rules
requiring companies to be more transparent
and be held accountable to their wider
stakeholders. The founding members of CORE
were Amnesty International, Christian Aid,
Friends of the Earth, New Economics
Foundation and Traidcraft. The coalition is
now supported by over fifty organisations,
including NGOs, church groups and trade
unions. www.corporate-responsibility.org
References
International Oil Pollution Compensation
Fund 1992 (7 May, 2003 ) “The level of
payments to the victims of the Prestige
incident limited to 15% for the time being”
http://www.iopcfund.org/pr-pdf/engpr-prestige-28%20may.pdf
International Oil Pollution Compensation
Funds 1971 and 1992 (10 July 2003) “IOPC Fund
meetings: July 2003 – in brief”
http://www.iopcfund.org/newspdfs/July03news_e.pdf
International
Oil Pollution Compensation Funds
http://www.iopcfund.org/erika.htm - updated
to 10 October, 2003
International Oil Pollution Compensation
Fund 1992 (2003)
http://www.iopcfund.org/intro.htm
International Oil Pollution Compensation
Fund 1971 (20 October 2003) “Out-of-court
settlement of recourse action taken by the
International Oil Pollution Compensation Fund
1971 against the Milford Haven Port Authority
in relation to the ‘Sea Empress’ incident”
http://www.iopcfund.org/pr-pdf/sea_empress.pdf
See
http://www.ciens.ula.ve/~jcenteno/black-th.html
and
http://abyayala.nativeweb.org/venezuela/ven2.html
for reports on the Nissos Amorgos.
See
http://earthobservatory.nasa.gov/Newsroom/NewImages/images.php3?img_id
=15292 for NASA photographs of yet another
slick in January 2003.
BBC News (17 December 1999) “Clean-up crews
battle 'thick' oil slick”
http://news.bbc.co.uk/1/hi/world/europe/568941.stm
International Oil Pollution Compensation
Funds http://www.iopcfund.org/erika.htm -
updated to 10 October, 2003 Ibid.
BBC News (31 December 1999) “Oil firm offers
clean-up cash”
http://news.bbc.co.uk/1/hi/world/europe/584445.stm
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