Compensation for nuclear damage: a comparison among the international regime, Japan and China

  • Jing Liu
  • Michael Faure
Original Paper


Following the Fukushima disaster in Japan in 2011, how the compensation system for nuclear damage should be improved has obtained broad attention. The compensation system, including liability rules, insurance and government involvement, does not only concern to what extent the victims can be sufficiently compensated, but is also relevant to create incentives for the nuclear industry to enhance safety. International compensation regimes for nuclear damage started to emerge since 1960s, but still fail to engage some (potentially) big “nuclear power” ones. The Japanese and Chinese systems are such ones which received less attention until recently. This paper will, on the one hand, engage in a positive study by giving a comparison between the international regime, the Japanese and the Chinese system; on the other hand, provide a normative analysis by using economic criteria to examine the efficiency of the systems and formulate suggestions for reform.


Nuclear liability Insurance Financial cap Limit on liability Disaster 



The Convention on Supplementary Compensation for Nuclear Damage


The General Principles of Civil Law of the People’s Republic of China


The International Atomic Energy Agency


International Nuclear Event Scale


The Nuclear Energy Agency


Organisation for Economic Co-operation and Development


The Product Quality Act of the People’s Republic of China


Special Drawing Rights


The Tokyo Electric Power Company



Michael Faure is grateful to the China Ministry of Education and to the Research Centre for Law and Economics of CUPL for their support.


  1. Ameye, E. (2010). Channelling of nuclear third party liability towards the operator: Is it sustainable in a developing nuclear world or is there a need for liability of nuclear architects and engineers? European Energy and Environmental Law Review, 19(1), 33.Google Scholar
  2. Cai, X (2004). The Civil Liability for Nuclear Damage (Ph.D dissertation, Wuhan University, China) (pp. 291–292). Accessed 17 February 2014.
  3. Duncan, E. J. Currie. (2008). The problems and gaps in the nuclear liability conventions and an analysis of how an actual claim would be brought under the current existing treaty regime in the event of a nuclear accident. Denver Journal of International Law and Policy, 35(1), 85–127.Google Scholar
  4. Faure, M. (1995). Economic models of compensation for damage caused by nuclear accidents: some lessons for the revision of the Paris and vienna conventions. European Journal of Law and Economics, 2(1), 21–43.CrossRefGoogle Scholar
  5. Faure, M., & Fiore, K. (2008). The civil liability of european nuclear operators: Which coverage for the new 2004 protocols? Evidence from France. International Environmental Agreements, 8, 228–248.CrossRefGoogle Scholar
  6. Faure, M., & Fiore, K. (2009). An economic analysis of the nuclear liability subsidy. Pace Environmental Law Review, 26, 419–447.Google Scholar
  7. Faure, M., & Liu, J. (2012). The tsunami of March 2011 and the subsequent nuclear incident at Fukushima: Who compensates the victims? William and Mary Environmental Law and Policy Review, 37, 129–218.Google Scholar
  8. Faure, M., & Van den Borre, T. (2008). Compensating nuclear damage: A comparative economic analysis of the US and international liability schemes. William and Mary Environmental Law and Policy Review, 33(1), 219–286.Google Scholar
  9. Faure, M., & Weiqiang, H. (2011). Towards a reform of environmental liability in China: An economic analysis. Asia Pacific Journal of Environmental Law, 13, 225–247.Google Scholar
  10. Hirokazu, O. (2000). Nuclear damage and liability insurance for nuclear damage. Oita University economic review, 51(6), 21–47.Google Scholar
  11. Japan Nuclear Energy Safety Organization (2010). Current status of nuclear facilities in Japan (p. 1) Accessed 17 February 2014.
  12. Jia, Y. (2011). Nuclear liability insurance in China, China Insurance 218, 47 (Chinese).Google Scholar
  13. Liu, J., & Faure, M. (2012). Compensating nuclear damage in China. Washington University Global Studies Law Review, 11(4), 781–816.Google Scholar
  14. Mosk, M. (2011). Fukushima: Mark 1 nuclear reactor design caused GE scientist to quit in protest, in ABC World News. Accessed 17 February 2014.
  15. Nomura, T., Hokugo, T. & Takenaka, C. (2012). Japan’s nuclear liability system. In OECD Nuclear Energy Agency (Ed.), Japan’s compensation system for nuclear damage: As related to the TEPCO Fukushima daiichi nuclear accident (pp. 15–28). Accessed 17 February 2014.
  16. OECD (2008). Nuclear legislation in OECD countries, regulatory and institutional framework for nuclear activities: Sweden, 13. Accessed 17 February 2014.
  17. Pelzer, N. (2007). International pooling of operators’ funds: An option to increase the amount of financial security to cover nuclear liability? Nuclear Law Bulletin, 79, 37.CrossRefGoogle Scholar
  18. Ramseyer, M. J. (2011). Why power companies build nuclear reactors on fault lines: The case of Japan. Theoretical Inquiries in Law, 31(2), 457.Google Scholar
  19. Schäfer, H., & Müller-Langer, F. (2009). Strict liability versus negligence. In M. Faure (Ed.), Tort law and economics (pp. 3–45). Cheltenham/Northampton: Edward Elgar.Google Scholar
  20. Schwartz, J. A. (2006). International nuclear third party liability law: The response to Chernobyl, In International Nuclear Law in the Post-Chernobyl Period (pp. 41–44), Paris, OECD-NEA.Google Scholar
  21. Schwartz, J. A. (2009). Great expectations: Where do we stand with the international nuclear liability conventions? In Norbert Pelzer (Ed.), European nuclear liability law in a process of change Berlin, Nomos, 43 et seq.Google Scholar
  22. Shavell, S. (1980). Strict liability versus negligence. Journal of Legal Studies, 9, 1–25.CrossRefGoogle Scholar
  23. Trebilcock, M., & Winter, R. A. (1997). The economics of nuclear accident law. International Review of Law and Economics, 17, 215–243.CrossRefGoogle Scholar
  24. Van den Borre, T. (2007). Shifts in governance in compensation for environmental damage: 20 Years after Chernobyl. In M. Faure & A. Verheij (Eds.), Shifts in compensation for environmental damage (pp. 261–311). Vienna: Springer.CrossRefGoogle Scholar
  25. Vásquez-Maignan, X. (2010). Nuclear liability in China. Asia Power, 20–22. Accessed 17 February 2014.
  26. Vásquez-Maignan, X. (2011). Fukushima: Liability and compensation. NEA News, 29(2), 9–11.Google Scholar
  27. Watabe, A. (2006). An economic analysis of nuclear accidents in Japan. In G. Liu (Ed.), Perspectives on international state and local economics (pp. 209–234). New York: Nova Science Publishers Inc.Google Scholar
  28. Weitzdörfer, J. (2011). Die haftung für nuklearschäden nach japanischem atomrecht—rechtsprobleme der reaktorkatastrofe von Fukushima I ((Liability for Nuclear Damages Pursuant to Japanese Atomic Law—Legal Problems Arising from the Fukushima I Nuclear Accident). Zeitschrift für Japanisches Recht, Journal of Japanese Law, 31, 61–115.Google Scholar

Copyright information

© Springer Science+Business Media Dordrecht 2014

Authors and Affiliations

  1. 1.Wuhan UniversityWuhanChina
  2. 2.Comparative and International Environmental LawMaastricht UniversityMaastrichtThe Netherlands
  3. 3.Comparative Private Law and EconomicsErasmus University RotterdamRotterdamThe Netherlands

Personalised recommendations