The international compensation regime is based on two international treaties elaborated under the auspices of the International Maritime Organization (IMO), namely the 1992 Civil Liability Convention and the 1992 Fund Convention. The 1992 Civil Liability Convention governs the liability of the shipowner, whereas the 1992 Fund Convention provides supplementary compensation through the International Oil Pollution Compensation Fund 1992 (1992 Fund), financed by a levy on oil receipts in Member States.

This paper describes recent developments in the international compensation regime.

The total amount of compensation available under the 1992 Conventions was increased from United States (US) $210 million to US $315 million for incidents occurring after 31 October 2003

In view of the experience of recent major incidents, the 1992 Fund set up a Working Group to hold an exchange of views concerning the need for and possibilities of improving the international compensation regime established by the 1992 Conventions.

As a result of preparatory work carried out by the Working Group, a Diplomatic Conference held in May 2003 adopted a draft Protocol establishing an optional third tier of compensation by means of a Supplementary Compensation Fund which would provide additional compensation over and above that available under the 1992 Conventions. The total amount of compensation available for pollution damage in the nations that become Parties to it will be US $1,150 million per incident, including the amounts payable under the 1992 Conventions. The Protocol will enter into force on 3 March 2005.

The Working Group continues its review of the 1992 Conventions and will examine a number of issues, inter alia, shipowners' liability. It is expected that the Working Group will make its final recommendations to the 1992 Fund Assembly in 2005 as to whether the 1992 Conventions should be re-opened and, if so, which issues should be considered.

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