Turkey: Memorandum On The Tariff And The Directive Communique With Regards To The Compulsory Vessel Liability Insurance

Last Updated: 26 November 2015
Article by Gur Law Firm

The Art. 1259 of the Turkish Commercial Code numbered 6102 ("TCC") indicates that "In case that passengers are transported by a vessel, which is licensed to carry 12 or more people, all carriers who undertake or perform the transportation partially or wholly are obliged to be insured for their potential responsibilities, which may arise in case of death or injuries of the passengers."

In line with the aforementioned provision of TCC, the Tariff and the Directive Communiqué with regards to the Compulsory Vessel Liability Insurance was issued by the Turkish Prime Ministry Undersecretariat of Treasury ("Undersecretariat of Treasury") and published on the official gazette dated October 18th, 2014 and numbered 29149 ("Communique").

The Communiqué is applied to all vessels, which carry passengers with commercial purpose and the vessels within the scope of the Art. 1259 of TCC, the Art. 12 of Regulation about the Regular Sea Voyages and the Art. 5 of the Regulation about the Insurance and the Inspection of the Vessels in relation to the Marine Claims. [Communiqué has entered into force and abrogated a previous communiqué, which was dated July 19th, 2014 and had the same name with the current one. Communiqué is applied for the vessels which are carrying more than 12 passengers as of the date of October 18th, 2014 but, for the vessels which are carrying 12 passengers or less, and the previous communiqué will be applied till March 30th, 2015 and the Communiqué will enter into force for such vessels as of such date.]

The Art. 12 of the Insurers Act numbered 5684 states that the coverage levels of the compulsory insurances will be determined by the Minister of the Undersecretariat of Treasury and thus, the minimum coverage amount for cases of death or injury of the passenger or damage to passengers' belongings are stipulated within the Communiqué.

In this respect, the minimum coverage amounts, which are indicated in the Communiqué, are as below:

Minimum Coverage
A. Pecuniary Coverage B. Coverage of Death, Injury and Treatment Costs
Per Baggage Per Vehicle Per Accident1 Per Person Per Accident
a) Vessel carries more than 12 passengers SDR 2,250 SDR 12,700 Passenger/Vehicle Capacity
X
SDR 2,250/12,700
SDR 250,000 Passenger Capacity
X
SDR 250,000
b) Vessel carries 12 passengers or less Passenger Capacity
X
TRY 2,500
TRY 250,000 Passenger Capacity
X
TRY 250,000

It is provided in the Communique that the maximum coverage amount of the liability insurances will be subject to the Art. 1263 of TCC2. Moreover Communiqué also allows insertion of the deductible in for the amount of up to 10% of the coverage amount into the insurance policy.

Communiqué provides that the insurance policies, which are issued by insurance companies which provide services in Turkey, will be deemed valid.

Moreover, it is stated that the insurance policies, which are issued by the Clubs or insurers which are on "The List of Approved P&I Clubs and Insurance Companies", which is issued by the Ministry of Transportation, Maritime Affairs and Communications under the scope of the Directive on the Recognition of the P&I Clubs and Insurance Companies with Respect to the Administrative Proceedings in Flag State Practices and provide the minimum coverage amounts stipulated in the Communiqué will be valid.

Furthermore, although there is no specific regulation in this Communiqué in relation to any document is which should be placed on board of passenger vessels as proof of the insurance, in line with the other related regulations, the insurance policy must be available on board on the passenger vessel for inspection of the authorities.

Footnotes

[1] Passenger capacity will be taken into consideration on passenger vessels and vehicle capacity will be taken into consideration on vehicle carriers. If the vessel is capable of carrying both, the one, which requires higher coverage amount, will be taken into consideration for the calculation.

[2] TCC Article 1263:

(1) Carrier's liability for the damage or loss of the cabin baggage, under no circumstances, shall exceed SDR 2,250 per transportation per passenger.

(2) Carrier's liability for the damage or loss of the vehicles and the all kinds of baggage which are carried in or on the vehicles, under no circumstances, shall exceed SDR 12,700 per transportation per passenger.

(3) Carrier's liability for the damage or the loss the baggage in cases other than mentioned under items 1 and 2 above, under no circumstances, shall exceed SDR 3,375 per transportation per passenger.

(4) Carrier and the passenger may agree on an exemption to be deducted from the total loss amount on carrier's liability up to SDR 330 for the damage and the loss of the vehicle and SDR 149 per passenger for the damage or loss of other baggage.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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