Abstract
The operation of unmanned/autonomous merchant ships in the shipping industry will be evolutionary, but every new development unavoidably brings along with it new risks. This paper aims to acquire a full and comprehensive understanding of several fundamental issues related to civil liability insurance for unmanned/autonomous merchant ships. It concludes that although no significant legal barrier can be identified, certain non-marine insurances seem necessary to fill in the gaps for insurance cover for unmanned/autonomous merchant ships.
The writing of this paper was financially supported by a research grant awarded by the Department of Logistics and Maritime Studies, The Hong Kong Polytechnic University (Account Code: G-UADQ).
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Notes
- 1.
- 2.
Forde (2015), p. 13.
- 3.
Chatterton (1915), p. 273.
- 4.
Norway opened its first test area in the world for unmanned ships in 2016, and now it has three test areas for unmanned ships, namely, Trondheim fjord, Sunnmøre region, and Oslofjord. Available at: https://worldmaritimenews.com/archives/237297/norway-opens-new-test-area-for-autonomous-ships/.
- 5.
Finland opened its first test area for autonomous ships in August 2017. Available at: https://worldmaritimenews.com/archives/227275/first-test-area-for-autonomous-ships-opened-in-finland/.
- 6.
The Australian Maritime Safety Authority granted a request for the operation of remotely operated unmanned ships in Australian waters in August 2017, see Working Boats issue 11 by AMSA 299 on 8 February 2018, p. 15, available at: https://www.amsa.gov.au/news-community/newsletters/working-boats-issue-11.
- 7.
- 8.
Noussia (2007), p. 1.
- 9.
Gurses (2016), p. 2.
- 10.
English Marine Insurance Act 1906, Sec. 1.
- 11.
CMI International Working Group Position Paper on Unmanned Ships and the International Regulatory Framework, p. 19, available at: http://comitemaritime.org/Maritime-Law-for-Unmanned-Craft/0,27153,115332,00.html.
- 12.
Zhu (2014), p. 64.
- 13.
Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 84.
- 14.
Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 84.
- 15.
Adoption: 29 November 1969; Entry into force: 19 June 1975; Being replaced by 1992 Protocol: Adoption: 27 November 1992; Entry into force: 30 May 1996.
- 16.
Adoption: 18 December 1971; Entry into force: 16 October 1978; superseded by 1992 Protocol: Adoption: 27 November 1992; Entry into force: 30 May 1996.
- 17.
Adoption: 17 December 1971; Entry into force: 15 July 1975.
- 18.
Adoption: 13 December 1974; Entry into force: 28 April 1987; 2002 Protocol: Adoption: 1 November 2002; Entry into force: 23 April 2014.
- 19.
Adoption: 19 November 1976; Entry into force: 1 December 1986; Protocol of 1996: Adoption: 2 May 1996; Entry into force: 13 May 2004.
- 20.
Adoption: 3 May 1996; Not in force; superseded by 2010 Protocol: Adoption: 30 April 2010; Not yet in force.
- 21.
Adoption: 23 March 2001; Entry into force: 21 November 2008.
- 22.
Adoption: 18 May 2007; Entry into force: 14 April 2015.
- 23.
Adopted by the International Labour Conference at its 94th (Maritime) Session (2006). Amendments approved by the International Labour Conference at its 103rd Session (2014).
- 24.
Convention for the Unification of Certain Rules of Law with respect to Collisions between Vessels (Brussels, 23 September 1910) is the most successful private law harmonisation Convention of the Comité Maritime International (CMI).
- 25.
Van Hooydonk (2014), p. 421.
- 26.
1910 Collision Convention, Article 3.
- 27.
See Nairobi Wreck Removal Convention, Article 10, “the registered owner shall be liable for the costs of locating, marking and removing [a] wreck”.
- 28.
See CLC, 1992, Article III, “the owner of a ship at the time of an incident…shall be liable for any pollution damage caused by the ship as a result of the incident”.
- 29.
Institute Time Clauses - Hulls 1.10.83, Article 8. INTERNATIONAL HULL CLAUSES (01/11/03), Article 6.
- 30.
INTERNATIONAL HULL CLAUSES (01/11/03), Article 38.
- 31.
Hurd (1952), pp. 147–148.
- 32.
Zhu (2007), p. 60.
- 33.
See Gard Rules 2016.
- 34.
The Swedish Club - Mortgagees Interest Insurance (MII), available at: https://www.swedishclub.com/insurance/marine/mortgagee-interest-insurance-mii/.
- 35.
Institute Cyber Attack Exclusion Clause CL3801.1 Subject only to clause 1.2 below, in no case shall this insurance cover loss damage liability or expense directly or indirectly caused by or contributed to by or arising from the use or operation, as a means for inflicting harm, of any computer, computer system, computer software programme, malicious code, computer virus or process or any other electronic system.2.1 Where this clause is endorsed on policies covering risks of war, civil war, revolution, rebellion, insurrection, or civil strife arising therefrom, or any hostile act by or against a belligerent power, or terrorism or any person acting from a political motive, Clause 1.1 shall not operate to exclude losses (which would otherwise be covered) arising from the use of any computer, computer system or computer software programme or any other electronic system in the launch and/or guidance system and/or firing mechanism of any weapon or missile.
- 36.
McLaughlin (2011), p. 100.
- 37.
E-navigation is defined by the IMO as “…the harmonized collection, integration, exchange, presentation and analysis of marine information on board and ashore by electronic means to enhance berth to berth navigation and related services for safety and security at sea and protection of the marine environment.” Available at: http://www.imo.org/en/OurWork/safety/navigation/pages/enavigation.aspx.
- 38.
IMO takes first steps to address autonomous ships, available at: http://www.imo.org/en/MediaCentre/PressBriefings/Pages/08-MSC-99-MASS-scoping.aspx.
- 39.
UNCLOS, Article 91.
- 40.
Van Hooydonk (2014), p. 406.
- 41.
The Nairobi International Convention on the Removal of Wrecks, 2007; the International Convention on Salvage, 1989; the 1992 Protocol to the Convention on Civil Liability for Oil Pollution Damage, 1969.
- 42.
Van Hooydonk (2014), p. 406. See also: Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 37.
- 43.
IMO takes first steps to address autonomous ships, available at: http://www.imo.org/en/MediaCentre/PressBriefings/Pages/08-MSC-99-MASS-scoping.aspx.
- 44.
Boisson (1994), pp. 363–377.
- 45.
Classification society, available at: https://en.wikipedia.org/wiki/Classification_society.
- 46.
Boisson (1994), pp. 363–377.
- 47.
New code to certify unmanned vessels announced, available at: https://www.lr.org/en/latest-news/new-code-to-certify-unmanned-vessels-announced/.
- 48.
Lloyd’s Register. Design Code for Unmanned Marine Systems, February 2017, Section 4.1.2, available at: https://www.lr.org/en/latest-news/new-code-to-certify-unmanned-vessels-announced/.
- 49.
Ibid, Section 2.1.3.
- 50.
The project MUNIN—Maritime Unmanned Navigation through Intelligence in Networks—as a collaborative research project, co-funded by the European Commission under its Seventh Framework Programme, has found the following result:Unmanned vessels can contribute to the aim of a more sustainable maritime transport industry……The autonomous ship represents a long-term, but comprehensive solution to meet these challenges, as it bears the potential to: 1) Reduce operational expenses; 2) Reduce environmental impact; and 3) Attract seagoing professionals. Available at: http://www.unmanned-ship.org/munin/about/munin-results-2/.
- 51.
- 52.
Wróbel et al. (2017), pp. 155–169.
- 53.
“Future Proofed? What Maritime Professionals Think about Autonomous Shipping?” Report by NAUTILUS Federation, A Federation of Maritime Professionals.
- 54.
Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 81.
- 55.
Hague-Visby Rules, Art. III.
- 56.
Anglis and Co v P and O Steam Navigation Co [1927] 2 KB 456; The Marine Sulphur Queen [1973] 1 Lloyd’s Rep 88, US CA; The Torenia [1983] 1 Lloyd’s Rep 210; and Coltman v Bibby Tankers Ltd, ‘Derbyshire’ [1986] 1 WLR 751. See Hodges (2012), p. 308.
- 57.
The President of India [1963] 1 Lloyd’s Rep 1; The Antigoni [1991] 1 Lloyd’s Rep 209; The Yamatogawa [1990] 2 Lloyd’s Rep 39; The Theodegmon [1990] 1 Lloyd’s Rep 52; The Subro Valour [1995] 1 Lloyd’s Rep 509; The Maria (1937) 91 Fed Rep (2d) 819; and The Irish Spruce [1976] 1 Lloyd’s Rep 63. See Hodges (2012), p. 308.
- 58.
Wedderburn and Others v Bell (1807) 1 Camp 1; The Makedonia [1962] 1 Lloyd’s Rep 316; Standard Oil Co of New York v Clan Line Steamers Ltd [1924] AC 100; and Hong Kong Fir Shipping Co v Kawasaki Kisen Kaisha [1962] 2 QB 26; [1961] 2 Lloyd’s Rep 478. See Hodges (2012), p. 308.
- 59.
Louis Dreyfus and Co v Tempus Shipping Co [1931] AC 726, HL; Fiumana Società di Navigazione v Bunge and Co Ltd [1930] 2 KB 47; Thin v Richards [1892] 2 QB 141; McIver and Co v Tate Steamers Ltd [1903] 1 KB 362; and Northumbrian Shipping Co v Timm and Son Ltd [1939] AC 397. See Hodges (2012), p. 308.
- 60.
The Aquacharm [1982] 1 Lloyd’s Rep 7; The Friso [1980] 1 Lloyd’s Rep 469; Elder Dempster and Co Ltd v Paterson, Zochonis and Co [1924] AC 522; and Smith Hogg and Co v Black Sea and Baltic Insurance Co [1940] AC 997. See Hodges (2012), p. 308.
- 61.
Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 92.
- 62.
English Marine Insurance Act 1906, Sec. 39(4).
- 63.
Hazelwood and Semark (2010), para. 11.22. In the China Shipowners Mutual Assurance Association (CPI) 2017/2018 Rules, unseaworthiness is associated with the wilful misconduct of a Member in RULE 8, which states that the CPI shall not be liable for any liabilities, losses, damages, costs or expenses which result from the Member’s knowingly sending the entered ship to sea in an unseaworthy condition.
- 64.
Carey L J. “All Hands off Deck? The Legal Barriers to Autonomous Ships”. NUS Centre for Maritime Law Working Paper, 2017.
- 65.
Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 92.
- 66.
The Maritime Safety Committee has begun to undertake a regulatory scoping exercise to determine how the safe, secure and environmentally sound operation of Maritime Autonomous Surface Ships (MASS) might be introduced in IMO instruments. See IMO, Report of the Maritime Safety Committee on Its Ninety-Eighth Session, MSC 98/23, pp. 78–79. CMI and other organisations had already commenced a gap analysis relating to the regulatory work for the introduction of unmanned/autonomous ships. See CMI International Working Group Position Paper on Unmanned Ships and the International Regulatory Framework, available at: http://comitemaritime.org/Maritime-Law-for-Unmanned-Craft/0,27153,115332,00.html.
- 67.
UK’s maritime sector body Maritime UK has launched a new Industry Code of Practice for the design, construction and operation of autonomous maritime systems. Available at: https://www.maritimeuk.org/media-centre/news/uk-launches-industry-code-practice-autonomous-vessels/. The Code of Practice can be found at: www.maritimeuk.org/mas-cop. The Danish Maritime Authority has also published a report on analysis of regulatory barriers to autonomous ships in December 2017. See Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017.
- 68.
Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 93.
- 69.
UNCLOS, Article 94 (3).
- 70.
UNCLOS, Article 94 (3) (b).
- 71.
“The competent international organization,” as used in UNCLOS Articles 22, 41, 53 and 60, means the International Maritime Organization (IMO) or its successor. Walker (2012), p. 138. Kingham and McRae (1979), pp. 106–132. Mihneva-Natova A. The Relationship Between United Nations Convention on the Law of the Sea and the IMO Conventions, the United Nations and the Nippon Foundation of Japan Fellow, 2005. Available at: http://www.un.org/depts/los/nippon/unnff_programme_home/fellows_pages/fellows_papers/natova_0506_bulgaria.pdf.
Secretariat IMO. Implications of the United Nations Convention on the Law of the Sea for the International Maritime Organization[J]. Study by the Secretariat of the International Maritime Organization (IMO) ‖, LEG/MISC, 2008, 6(10). Available at: http://www.imo.org/en/OurWork/Legal/Documents/LEG%20MISC%208.pdf.
- 72.
IMO takes first steps to address autonomous ships, available at: http://www.imo.org/en/MediaCentre/PressBriefings/Pages/08-MSC-99-MASS-scoping.aspx.
- 73.
The Danish Maritime Authority’s report lists these four elements. See Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 84.
- 74.
Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 58.
- 75.
Boyle (2005), pp. 563–584.
- 76.
Rødseth Ø J, Burmeister H C. “Developments toward the Unmanned Ship”, Proceedings of International Symposium Information on Ships–ISIS. 2012, 201, p. 7. Available at: http://www.unmanned-ship.org/munin/wp-content/uploads/2012/08/R%C3%B8dseth-Burmeister-2012-Developments-toward-the-unmanned-ship.pdf.
- 77.
“Future Proofed? What Maritime Professionals Think about Autonomous Shipping?” Report by NAUTILUS Federation, A Federation of Maritime Professionals.
- 78.
Rødseth Ø J, Burmeister H C. “Developments toward the Unmanned Ship”, Proceedings of International Symposium Information on Ships–ISIS. 2012, 201, p. 10. Available at: http://www.unmanned-ship.org/munin/wp-content/uploads/2012/08/R%C3%B8dseth-Burmeister-2012-Developments-toward-the-unmanned-ship.pdf.
- 79.
With 23 years in the Merchant Marines, including 13 as captain of five vessels, Mr. Kinsey said: “I believe that a human presence on board with active piracy measures in place is an effective deterrent to a pirate boarding.” See Mahoney (2016). Available at: https://search.proquest.com/docview/1766119189?accountid=16210.
- 80.
Mahoney (2016). Available at: https://search.proquest.com/docview/1766119189?accountid=16210.
- 81.
Mahoney (2016). Available at: https://search.proquest.com/docview/1766119189?accountid=16210.
- 82.
Van Hooydonk (2014), p. 421.
- 83.
Veal and Tsimplis (2017), p. 317.
- 84.
Veal and Tsimplis (2017), p. 317.
- 85.
Danish Maritime Authority. “Analysis of Regulatory Barriers to Autonomous Ships: Final Report”, December 2017, p. 64. See also Cartner et al. (2009), p. 86.
- 86.
- 87.
Swedish Maritime Act, SFS 1994:1009 Sjölag, § 6:11.
- 88.
MLC, 2006, Article II, 1, (j). “shipowner means the owner of the ship or another organization or person, such as the manager, agent or bareboat charterer, who has assumed the responsibility for the operation of the ship from the owner and who, on assuming such responsibility, has agreed to take over the duties and responsibilities imposed on shipowners in accordance with this Convention, regardless of whether any other organization or persons fulfil certain of the duties or responsibilities on behalf of the shipowner.”
- 89.
The employees of the shipowner are the people who have contracts with the shipowner and work for the ship no matter on board or off board, including the seafarer, manager, operator, etc.
- 90.
Rose (2004), p. 349.
- 91.
“CMI International Working Group Position Paper on Unmanned Ships and the International Regulatory Framework”, p. 19, available at: http://comitemaritime.org/Maritime-Law-for-Unmanned-Craft/0,27153,115332,00.html.
- 92.
“CMI International Working Group Position Paper on Unmanned Ships and the International Regulatory Framework”, p. 19, available at: http://comitemaritime.org/Maritime-Law-for-Unmanned-Craft/0,27153,115332,00.html.
- 93.
“Government to review law before self-driving cars arrive on UK roads”, available at: https://www.theguardian.com/technology/2018/mar/06/self-driving-cars-in-uk-riding-on-legal-review.
- 94.
“Unmanned and Autonomous Vessels – The Legal Implications from a P&I Perspective”, available at: https://www.shipownersclub.com/autonomous-vessels/.
- 95.
International Group of Protection & Indemnity Clubs, available at: https://www.igpandi.org/about.
- 96.
Gard has seen three major developments in new product areas during the last six months, including involvement in the development of autonomous shipping. Available at: http://www.gard.no/web/news/article?p_document_id=24640524.
- 97.
“Shipping: An Autonomous Future?” Available at: http://www.nepia.com/insights/signals-online/ships/autonomous-ships/shipping-an-autonomous-future/.
- 98.
The Club is in communication with some of the top industry players developing autonomous vessel technology and preparing to provide equipment and related services to vessel owners. Available at: https://www.shipownersclub.com/pi-cover-autonomous-vessels/.
- 99.
“P & I Cover for Autonomous Vessels”, available at: https://www.shipownersclub.com/autonomous-vessels/.
- 100.
MLC 2006, Regulation 2.5, Standard A2.5.2 and Guideline B2.5.
- 101.
MLC 2006, Regulation 4.2., Standard A4.2 and Guideline B4.2.
- 102.
Circular: Maritime Labour Convention 2006 as amended (MLC) Financial Security Requirements, available at: https://www.shipownersclub.com/publications/maritime-labour-convention-2006-as-amended-mlc-financial-security-requirements/.
- 103.
Van Hooydonk (2014), p. 418.
- 104.
Mahoney (2016). Available at: https://search.proquest.com/docview/1766119189?accountid=16210.
- 105.
Maritime Safety Committee (MSC), 98th session, 7–16 June 2017, available at: http://www.imo.org/en/MediaCentre/MeetingSummaries/MSC/Pages/MSC-98th-session.aspx.
- 106.
Marsh LLC, The Risk of Cyber Attack to the Maritime Sector, July 2014, p. 3, available at: https://www.marsh.com/uk/insights/research/the-risk-of-cyber-attack-to-the-maritime-sector.html.
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Marsh LLC, Cyber Gap Insurance Cyber Risk: Filling the Coverage Gap, July 2014, p. 3, available at: http://www.oliverwyman.com/content/dam/marsh/Documents/PDF/UK-en/Cyber%20Gap%20Insurance%20Cyber%20Risk%20Filling%20the%20Coverage%20Gap-07-2014.pdf.
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Zhu, L., Xing, R.W.W. (2020). Probing Civil Liability Insurance for Unmanned/Autonomous Merchant Ships. In: Marano, P., Noussia, K. (eds) InsurTech: A Legal and Regulatory View. AIDA Europe Research Series on Insurance Law and Regulation, vol 1. Springer, Cham. https://doi.org/10.1007/978-3-030-27386-6_16
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