UK: The Bunkers Convention

Last Updated: 14 October 2008
Article by Kevin Austin

Following its ratification by Sierra Leone in November 2007, The International Convention on Civil Liability for Bunker Oil Pollution Damage (2001) ("Bunkers Convention") will enter into force on 21 November 2008. 

The Convention closes the last significant gap in the international regime for compensating victims of pollution from ships, forming a triumvirate of conventions together with the International Convention on Civil Liability for Oil Pollution Damage (1992) ("CLC"), and the International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea (1996) ("HNS Convention").


The CLC was founded on three main principles: strict liability of the shipowner for oil pollution with only very restricted exemptions; the requirement that the shipowner maintain liability insurance or other financial security; and an entitlement that the shipowner may limit its liability.

The CLC, however, only applied to oil tankers. With many large non-tankers carrying larger quantities of oil in bunkers than some tankers carry as cargo, this was a serious omission particularly when bunker fuels' highly viscous and persistent nature can make them a far more serious polluter than some crude oils. The Bunkers Convention seeks to remedy this situation by providing a regime of compensation for oil pollution from spilled bunkers.

The Bunkers Convention

The Bunkers Convention operates independently of the other liability regimes. The Convention is geographically limited to pollution damage caused within the Convention Country territory; however, it appears that it would also apply to spills on the high seas that subsequently caused damage within the stipulated area.

The Bunkers Convention applies to every vessel registered in and flying the flag of a Bunkers Convention Country with a gross tonnage greater than 1,000GT. It also applies to any vessel over 1,000GT, regardless of whether or not it is registered in a Convention Country, that enters or leaves a port in a Convention Country territory. Liability is strict with no requirement to prove fault.

Insurance And Certification

The shipowner is defined more broadly than in the CLC, and includes the registered owner, bareboat charterer, manager and operator. Each of these may be held jointly or severally liable as indeed may the owners of all the ships involved in a multi-vessel incident. The registered owner is required to maintain insurance or other financial security to cover the liability. From August 2008, International Group P&I Clubs have been issuing shipowners with Bunkers Convention 'Blue Cards' evidencing that they have the requisite liability insurance. The 'Blue Card' or other evidence of insurance or financial security is then submitted to the vessel's flag state (if a Convention Country) with the latter issuing a 'Bunkers Convention Certificate'.

For vessels not registered in a Convention Country, the owners will need to obtain a certificate from a state party if it is trading to or from a party to the Convention. At present, it is unclear how this process will be managed. In particular there is some doubt as to whether state parties will be prepared to issue Bunkers Convention Certificates prior to the arrival of the vessel in the state in question or whether other states would be prepared to issue certificates to vessels not calling at their ports.

Although not having a valid certificate is unlikely to result in a shipowner being deprived of its right to limit under the Convention (provided of course that it has the requisite insurance in place), the uncertainties mentioned above may result in a vessel being delayed/detained with the resultant possibility of cargo and charterparty disputes. 

Under the Convention, failing to take steps to obtain a Bunkers Convention Certificate, however, requires that the vessel's flag state (if a Convention Country) prevent the vessel from trading.


The Bunkers Convention does not apply to pollution damage caused by ships carrying oil in bulk as cargo (covered by the CLC) but applies to tankers when they are not carrying oil in bulk as cargo (i.e. when on a ballast voyage).

Limitation Of Liability

Any claims will have to be brought in the Convention Country in which the damage occurred. The shipowner is entitled to limit its liability in accordance with that state's national law, up to an amount not exceeding that calculated in accordance with the Convention on Limitation of Liability for Maritime Claims 1976/1996 (LLMC). The ability to break limitation will also be determined by national law.

Although the shipowner is ultimately liable for pollution damage, there is a further important provision in the Bunkers Convention which entitles the claimant to bring an action for compensation directly against the insurer or the person providing financial security.

The Bunkers Convention fills an important gap in the international pollution liability regimes. It remains to be seen whether the administrative burden imposed on the Convention Countries will be overcome by the implementation date, and there are lingering doubts as to the amount of compensation available. Whilst the Convention provides some certainty for shipowners trading to state parties, to date only 21 states are party to the Convention.

The full version of this article was first published in Maritime Risk International, July/August 2008

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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