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Port States Behind the Scenes: The European Union’s 2009 Insurance Directive

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Port State Jurisdiction and the Regulation of International Merchant Shipping

Part of the book series: Hamburg Studies on Maritime Affairs ((HAMBURG,volume 26))

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Abstract

This chapter primarily discusses the EU’s Directive of 2009 on shipowners’ insurance (the Insurance Directive), and its interaction with the Convention on Limitation of Liability for Maritime Claims (the 1976 Convention) along with the 1996 Protocol to that convention (the 1996 Protocol).

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Notes

  1. 1.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims.

  2. 2.

    Convention on Limitation of Liability for Maritime Claims (19 November 1976); Protocol of 1996 to amend the Convention on Limitation of Liability for Maritime Claims of 19 November 1976 (3 May 1996).

  3. 3.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 9(1).

  4. 4.

    For a summary see Chuah, “The Third Maritime Safety Package – Objectives and Challenges” (2009); Proelss, “The ‘Erika III’ Package: Progress or Breach of International Law?” (2012). The first two Erika packages are discussed in Nesterowicz, “European Union Legal Measures in Response to the Oil Pollution of the Sea” (2004).

  5. 5.

    Directive 2009/16/EC of 23 April 2009 on port State control.

  6. 6.

    Directive 2009/15/EC of 23 April 2009 on common rules and standards for ship inspection and survey organisations and for the relevant activities of maritime administrations; Regulation No 391/2009 of 23 April 2009 on common rules and standards for ship inspection and survey organisations.

  7. 7.

    Directive 2009/17/EC of 23 April 2009 amending Directive 2002/59/EC establishing a Community vessel traffic monitoring and information system.

  8. 8.

    Directive 2009/21/EC of 23 April 2009 on compliance with flag State requirements.

  9. 9.

    Directive 2009/18/EC of 23 April 2009 establishing the fundamental principles governing the investigation of accidents in the maritime transport sector and amending Council Directive 1999/35/EC and Directive 2002/59/EC of the European Parliament and of the Council.

  10. 10.

    Regulation No 392/2009 of 23 April 2009 on the liability of carriers of passengers by sea in the event of accidents; Athens Convention relating to the Carriage of Passengers and their Luggage by Sea (13 December 1974, as amended).

  11. 11.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, recital 1.

  12. 12.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, recital 4.

  13. 13.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, recitals 2 and 5; Directive 2005/35/EC of 7 September 2005 on ship-source pollution and on the introduction of penalties for infringements.

  14. 14.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, recital 4; International Maritime Organization, Guidelines on Shipowners’ Responsibilities in respect of Maritime Claims (4 February 2000).

  15. 15.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, recital 3; Council of the European Union, Statement by the Member States on Maritime Safety (19 November 2008).

  16. 16.

    Treaty Establishing the European Community (consolidated version, 2006).

  17. 17.

    Treaty on European Union and the Treaty on the Functioning of the European Union (consolidated version, 2010).

  18. 18.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 3.

  19. 19.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 4.

  20. 20.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 4.

  21. 21.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 13 (draft arts 5 and 6).

  22. 22.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 15 (draft art 10).

  23. 23.

    European Union, Committee of the Regions, Opinion of the Committee of the Regions on the 3 rd Maritime Safety Package, 49–50.

  24. 24.

    European Economic and Social Committee, Opinion of the European Economic and Social Committee on the [3 rd Maritime Safety Package] (2006), paras 4.7.2–4.7.3.

  25. 25.

    European Parliament, Transport and Tourism Committee, Report on the proposal for a directive of the European Parliament and of the Council on the civil liability and financial guarantees of shipowners (6 March 2007), 18.

  26. 26.

    European Parliament, Transport and Tourism Committee, Report on the proposal for a directive of the European Parliament and of the Council on the civil liability and financial guarantees of shipowners (6 March 2007), 20.

  27. 27.

    European Parliament, Transport and Tourism Committee, Report on the proposal for a directive of the European Parliament and of the Council on the civil liability and financial guarantees of shipowners (6 March 2007), 6–7.

  28. 28.

    European Parliament, European Parliament legislative resolution of 29 March 2007 on the proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (29 March 2007), 3 and 7 (draft arts 4 and 5).

  29. 29.

    European Parliament, European Parliament legislative resolution of 29 March 2007 on the proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (29 March 2007), 14 (draft art 14).

  30. 30.

    European Commission, Amended Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (24 October 2007), 4.

  31. 31.

    European Commission, Communication from the Commission to the European Parliament pursuant to the second subparagraph of Article 251(2) of the EC Treaty concerning the common position of the Council on the adoption of a Directive on the civil liability and financial guarantees of shipowners (9 December 2008), 3.

  32. 32.

    Council of the European Union, Statement of the Council’s Reasons: Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008), 3; Council of the European Union, Common Position (EC) No 29/2008 adopted by the Council on 9 December 2008 (2008), 11.

  33. 33.

    Council of the European Union, Statement of the Council’s Reasons: Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008), 5; Council of the European Union, Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008); Council of the European Union, Common Position (EC) No 29/2008 adopted by the Council on 9 December 2008 (2008).

  34. 34.

    European Parliament, Legislative resolution of 11 March 2009 on the common position adopted by the Council with a view to the adoption of a directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (11 March 2009).

  35. 35.

    International Group of P&I Clubs, EU – Directive on the Insurance of Ship-owners for Maritime Claims (Formerly the Civil Liability Directive) (press release, March 2009). When the more ambitious initial proposal was released for consultation with industry bodies insurance companies apparently “emphasised the benefits of such a measure”, whereas shipowners were sceptical: European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 5.

  36. 36.

    This is the number of merchant vessels over 100 gross tonnes currently detailed in the online IHS Fairplay World Shipping Encyclopedia available at www.ihs.com. The International Group of P&I Clubs refers to a figure of 85,000 vessels in its annual report: International Group of P&I Clubs, Annual Review 2011/12 (8 February 2012), 3.

  37. 37.

    Compare Røsæg, “Compulsory Maritime Insurance” (2000), 181, noting that the insurance industry is generally opposed to compulsory marine insurance schemes.

  38. 38.

    See for example UK P&I Club, Directive 2009/20/EC of the European Parliament and of the Council of 23rd April 2009 on the Insurance of Shipowners for Maritime Claims (Circular 13/09, 11 December 2009), available at www.ukpandi.com.

  39. 39.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 2(1) and (2). It excludes warships and other non-commercial government ships.

  40. 40.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 4(1).

  41. 41.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 3(a).

  42. 42.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 3(b).

  43. 43.

    Hazelwood and Semark, P&I Clubs Law and Practice (2010), 123.

  44. 44.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 4(3).

  45. 45.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 4(2).

  46. 46.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 6(1).

  47. 47.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 5(1).

  48. 48.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 6(2).

  49. 49.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 5(2).

  50. 50.

    For example, French legislation imposes a fine of €45,000 on persons who fail to comply with the Directive’s requirements: Code des Transports, arts L5123-1 and L5123-6(I).

  51. 51.

    See Ringbom, The EU Maritime Safety Policy and International Law (2008), ch 5.

  52. 52.

    European Commission, Communication on a European Ports Policy (18 October 2007), 2.

  53. 53.

    Ringbom, “Global Problem – Regional Solution? International Law Reflections on an EU CO2 Emissions Trading Scheme for Ships” (2011), 618. Eurostat recorded more than 2 million port calls in the main EU ports (excluding France) in 2010: Eurostat, Maritime Ports Freight and Passenger Statistics – Statistics Explained (2 March 2012), pt 1.14.

  54. 54.

    TFEU, art 4(2)(g) and Title VI.

  55. 55.

    TFEU, art 100(2).

  56. 56.

    See Regulation No 417/2002 of 18 February 2002 on the accelerated phasing-in of double hull or equivalent design requirements for single hull oil tankers and repealing Council Regulation (EC) No 2978/94, especially recital 9; compare Regulation No 1726/2003 of 22 July 2003 amending Regulation (EC) No 417/2002 on the accelerated phasing-in of double hull or equivalent design requirements for single hull oil tankers, especially recitals 2–3; see also Ringbom, The EU Maritime Safety Policy and International Law (2008), 346–352.

  57. 57.

    Directive 2005/33/EC of 6 July 2005 amending Directive 1999/32/EC as regards the sulphur content of marine fuels; see Ringbom, The EU Maritime Safety Policy and International Law (2008), 264–266 and 312–314. The Directive notably requires passenger vessels operating out of EU ports to have a fuel sulphur content of 1.5 % (art 4a), as opposed to the current international standard of 3.5 %: MARPOL, Annex VI, reg 14. The requirement for vessels to use fuel with a sulphur content of 0.1 % while berthed at an EU port (art 4b) has no international equivalent.

  58. 58.

    See Ringbom, “Global Problem – Regional Solution? International Law Reflections on an EU CO2 Emissions Trading Scheme for Ships” (2011).

  59. 59.

    Røsæg notes that prior to 1969 insurance was “an internal matter for shipowners”: Røsæg, “Compulsory Maritime Insurance” (2000), 179. Nonetheless, the basic idea is of considerable vintage, see Bisschop, Limitation of Shipowner’s Liability and Compulsory Insurance of Passengers (1927). An earlier convention without much practical impact (and which did not enter into force) was the Convention on the Liability of Operators of Nuclear Ships (25 May 1962), art III.

  60. 60.

    For example, after identifying the problem of bunkers-related pollution and the need to address it the preamble to the International Convention on Civil Liability for Bunker Oil Pollution Damage (23 March 2001) notes that “complementary measures are necessary to ensure the payment of adequate, prompt and effective compensation for damage caused by pollution …”. For this and other policy considerations see Røsæg, “Compulsory Maritime Insurance” (2000), 181–183; Soyer, “Sundry Considerations on the Draft Protocol to the Athens Convention Relating to the Carriage of Passengers and their Luggage by Sea 1974” (2002), 526–528; Zhu, Compulsory Insurance and Compensation for Bunker Oil Pollution Damage (2007), 51–55; Damar, “Compulsory Insurance in International Maritime Conventions” (2009), 155–156.

  61. 61.

    See Steel, “Ships are Different: The Case for Limitation of Liability” (1995), 79 and 82.

  62. 62.

    International Convention on Civil Liability for Oil Pollution Damage (29 November 1969), art VII.

  63. 63.

    International Convention on Civil Liability for Bunker Oil Pollution Damage (23 March 2001), art 7.

  64. 64.

    International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea, as amended by the Protocol of 2010 (3 May 1996, 30 April 2010), art 12.

  65. 65.

    Protocol of 2002 to the Athens Convention relating to the Carriage of Passengers and their Luggage by Sea (1 November 2002), art 4bis.

  66. 66.

    Nairobi International Convention on the Removal of Wrecks (18 May 2007), art 12. As stated in its preamble, this instrument is based on navigation safety considerations in addition to environmental concerns.

  67. 67.

    Bunkers Convention, arts 6 and 7; Wreck Removal Convention, arts 10 and 12.

  68. 68.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 2(3) and annex.

  69. 69.

    The requirement was introduced by the Water Pollution Prevention and Control Act 1972, s 311(p); see Fitch, “Unilateral Action Versus Universal Evolution of Safety and Environmental Protection Standards in Maritime Shipping of Hazardous Cargoes” (1979), 151–152; see now 33 USC 2716; Schoenbaum, Admiralty and Maritime Law (vol 2, 2011) 302.

  70. 70.

    Merchant Shipping Act 1995, s 192A; see Soyer, “1996 Protocol to the 1976 Limitation Convention: A More Satisfactory Global Limitation Regime for the Next Millennium?” (2000), 170.

  71. 71.

    The Merchant Shipping (Compulsory Insurance: Ships Receiving Trans-shipped Fish) Regulations 1998. This includes insurance for salvage, and the repatriation of seafarers: cl 5.

  72. 72.

    Protection of the Sea (Civil Liability) Act 1981, Part IIIA; Protection of the Sea (Civil Liability) Regulations 1983, cl 12. For similar New Zealand requirements see Maritime Transport Act 1994, s 363; Maritime Transport (Certificate of Insurance) Regulations 2005; Marine Protection Rules Part 102 – Certificates of Insurance (30 December 2004).

  73. 73.

    See Griggs, Williams and Farr, Limitation of Liability for Maritime Claims (2005), ch 2; Brice, “The Scope of the Limitation Action” (1986), 18–21.

  74. 74.

    Griggs, Williams and Farr, Limitation of Liability for Maritime Claims (2005), 3.

  75. 75.

    International Maritime Organization, Summary of Status of Conventions (6 March 2013).

  76. 76.

    This decision, which is envisaged by art 9(2) of the 1996 Protocol may have the effect of limiting the denouncing state’s shipowners’ ability to rely on the 1976 Convention limits when before the courts of a party that has signed the 1976 Convention, but not the 1996 Protocol: see also 1976 Convention, art 15(1). See Griggs, “Limitation of Liability for Maritime Claims: The Search for International Uniformity” (1997), 374.

  77. 77.

    Steel, “Ships are Different: The Case for Limitation of Liability” (1995), 82.

  78. 78.

    1976 Convention, art 2.

  79. 79.

    1976 Convention, art 3.

  80. 80.

    1976 Convention, art 4.

  81. 81.

    Griggs, Williams and Farr, Limitation of Liability for Maritime Claims (2005), 39–40.

  82. 82.

    See The Leerort [2001] 2 Lloyd’s Rep 291 (CA).

  83. 83.

    1976 Convention, art 1(6).

  84. 84.

    See Soyer, “1996 Protocol to the 1976 Limitation Convention: A More Satisfactory Global Limitation Regime for the Next Millennium?” (2000). The tacit acceptance procedure allows international conventions to be updated without requiring all states parties to expressly agree to the amendment in question. A state may reject the amendment, agree to it, or remain silent, and in the latter two cases the amendment will enter into force for that state after a set period of time. This works more quickly than the traditional process in which parties to the original treaty negotiate, sign and ratify a protocol to the original instrument: see Aust, Modern Treaty Law and Practice (2007), 266–270.

  85. 85.

    See Griggs, Williams and Farr, Limitation of Liability for Maritime Claims (2005), 43.

  86. 86.

    1976 Convention, art 6(5): International Convention on Tonnage Measurement of Ships (23 June 1969).

  87. 87.

    1976 Convention, art 8.

  88. 88.

    Griggs, Williams and Farr, Limitation of Liability for Maritime Claims (2005), p 51.

  89. 89.

    International Monetary Fund, www.imf.org.

  90. 90.

    1976 Convention, art 6(1)(a).

  91. 91.

    1976 Convention, art 6(1)(b).

  92. 92.

    1976 Convention, art 9.

  93. 93.

    1976 Convention, art 7. This combination of provisions gives rise to a complicated relationship with the Athens Convention, which also deals with liability towards passengers, and which has now been adopted into European Union law: see Griggs, Williams and Farr, Limitation of Liability for Maritime Claims (2005), 52–55, 89, and 109; Regulation No 392/2009 of 23 April 2009 on the liability of carriers of passengers by sea in the event of accidents.

  94. 94.

    See 1976 Convention, art 15(3bis).

  95. 95.

    1976 Convention, arts 10–13.

  96. 96.

    See generally Chap. 3, Sect. 3.1.3.

  97. 97.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 13–15 (draft arts 5 and 8(2)).

  98. 98.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 7.

  99. 99.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 13 (draft art 6).

  100. 100.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 15 (draft art 8(3)).

  101. 101.

    European Economic and Social Committee, Opinion of the European Economic and Social Committee on the [3 rd Maritime Safety Package] (2006), para 4.7.2.

  102. 102.

    European Parliament, Transport and Tourism Committee, Report on the proposal for a directive of the European Parliament and of the Council on the civil liability and financial guarantees of shipowners (6 March 2007), 19.

  103. 103.

    P&I policies offer cover in conjunction with any liability limits that exist, deeming that a member will have exercised any available limitation of liability rights: see Hazelwood and Semark, P&I Clubs: Law and Practice (2010), 241 and following; Gold, Gard Handbook on P&I Insurance (2002), 506.

  104. 104.

    This is also the interpretation adopted by Proelss, “The ‘Erika III’ Package: Progress or Breach of International Law?” (2012), pt D(I).

  105. 105.

    See UNCLOS, art 18(2).

  106. 106.

    Code des Transports, art L5231-1 (France); Gibraltar Merchant Shipping (Insurance for Maritime Claims) Regulations 2012, cl 4(2); European Union (Insurance of Shipowners for Maritime Claims) Regulations 2011 (Ireland), reg 4(3); Merchant Shipping (Insurance for Maritime Claims) Regulations 2011 (Malta), cl 4(2).

  107. 107.

    UNCLOS, art 21(1)(a); see discussion at Chap. 4, Sect. 4.2.2.

  108. 108.

    1976 Convention, art 2(1)(a).

  109. 109.

    UNCLOS, art 21(1)(f).

  110. 110.

    See for example European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 5; European Union, Committee of the Regions, Opinion of the Committee of the Regions on the 3 rd Maritime Safety Package (2006), paras 7.2 and 7.8.

  111. 111.

    Stephenson, “Vessel-Source Pollution under the Law of the Sea Convention: An Analysis of the Enforcement Standards” (1992), 134; Vukas, The Law of the Sea: Selected Writings (2004), 30.

  112. 112.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, recital 4.

  113. 113.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, recital 2.

  114. 114.

    Pollution-related claims may arise under article 2(1)(a) of the 1976 Convention provided they occur “in direct connection with the operation of the ship”, while claims arising from pollution from cargo or bunkers will fall under article 2(1)(d) provided they relate to clean-up or pollution prevention costs see: The Aegean Sea [1998] 2 Lloyd’s Rep 39 (QB), 52–53. See also Griggs, Williams and Farr, Limitation of Liability for Maritime Claims (2005), 19 and 23.

  115. 115.

    UNCLOS, art 56(1)(b)(iii).

  116. 116.

    Regulation No 1726/2003 of 22 July 2003 amending Regulation (EC) No 417/2002 on the accelerated phasing-in of double hull or equivalent design requirements for single hull oil tankers; see Ringbom, The EU Maritime Safety Policy and International Law (2008), 346–352.

  117. 117.

    Directive 2005/33/EC of 6 July 2005 amending Directive 1999/32/EC as regards the sulphur content of marine fuels, art 4a; MARPOL, Annex VI, reg 14.

  118. 118.

    See Johnson, Coastal State Regulation of International Shipping (2004), 54–56.

  119. 119.

    Commune de Mesquer v Total France SA and Total International Ltd [2008] ECJ Case C-188/07, applying Directive 1975/442/EEC of 15 July 1975 on Waste.

  120. 120.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005).

  121. 121.

    See International Fruit Company NV [1972] ECJ Case C-21-24/72.

  122. 122.

    See Ringbom The EU Maritime Safety Policy and International Law (2008), 219–223.

  123. 123.

    See for example Boisson, Safety at Sea: Policies, Regulations and International Law (1999), 170; Jenisch, “The European Union as an Actor in the Law of the Sea: The Emergence of Regionalism in Maritime Safety, Transportation and Ports” (2005), 251 and 259; Lagoni, “Law and Uses of the Sea in a Change” (2009), 264. There is also an element of this line of thinking in the Sellers decision, discussed in Chap. 4, Sect. 4.3.

  124. 124.

    See for example International Convention on the Control of Harmful Anti-fouling Systems on Ships (5 October 2001), art 1(3); International Convention for the Control and Management of Ships’ Ballast Water and Sediments (13 February 2004), art 2(3).

  125. 125.

    Ringbom, “Regional Rules on Ship Safety and Pollution Prevention – Some Public International Law Reflections” (1997), 291 and 293.

  126. 126.

    See for example MARPOL, Annex VI, reg 15(1).

  127. 127.

    Molenaar, “Residual Jurisdiction under IMO Regulatory Conventions” (1997); Johnson, Coastal State Regulation of International Shipping (2004), 43–44; Ringbom, The EU Maritime Safety Policy and International Law (2008), 222–223.

  128. 128.

    See Stephenson, “Vessel-Source Pollution under the Law of the Sea Convention: An Analysis of the Prescriptive Standards” (1992), 133–134; Tan, “The Regulation of Vessel-Source Marine Pollution: Reconciling the Maritime and Coastal State Interests” (1997), 360–361.

  129. 129.

    Bearing in mind the policy considerations discussed in Chap. 3, Sect. 3.3.1.

  130. 130.

    See Eeckhout, EU External Relations Law (2011), 429 and 432; Rosas, “The Status in EU Law of International Agreements Concluded by EU Member States” (2011), 1315 and 1322–1323.

  131. 131.

    See Soyer, “1996 Protocol to the 1976 Limitation Convention: A More Satisfactory Global Limitation Regime for the Next Millennium?” (2000), 169.

  132. 132.

    Nonetheless, the problem may at times arise further up the chain, as a vessel’s insurers may simply rely on its classification society to certify it as worthy of insuring, and if the classification society is not enforcing the appropriate standards then the insurer may be lulled into a false sense of security. The risk is even greater when the insurance market is depressed and insurers less selective: SSY Consultancy and Research Ltd, The Cost to Users of Substandard Shipping (January 2001), 5–6.

  133. 133.

    Steel, “Ships are Different: The Case for Limitation of Liability” (1995), 79.

  134. 134.

    See for example Mustill, “Ships are Different – Or Are They?” (1993); Gauci, “Limitation of Liability in Maritime Law: An Anachronism?” (1995); Haddon-Cave, “Limitation Against Passenger Claims: Medieval, Unbreakable and Unconscionable” (2001).

  135. 135.

    See Seward, “The Insurance Viewpoint” (1986); Steel, “Ships are Different: The Case for Limitation of Liability” (1995), 82; Lahmer, “Limitation of Liability and Denial of Limitation in Maritime Conventions: Past, Present and Future of Limitation of Liability” (2009), 99–104.

  136. 136.

    Basedow, Der Transportvertrag (1987); for a discussion in English with reference to these arguments and others see Damar, Wilful Misconduct in International Transport Law (2011), 16–20; see from an economic perspective Billah, “Economic Analysis of Limitation of Shipowners’ Liability” (2006–2007), 310–312.

  137. 137.

    For example the EU is a party to the Convention for the Unification of Certain Rules for International Carriage by Air (28 May 1999).

  138. 138.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 3; but see Soyer, “1996 Protocol to the 1976 Limitation Convention: A More Satisfactory Global Limitation Regime for the Next Millennium?” (2000), 158–162 and 167.

  139. 139.

    European Parliament, Transport and Tourism Committee, Report on the proposal for a directive of the European Parliament and of the Council on the civil liability and financial guarantees of shipowners (6 March 2007), 18.

  140. 140.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 13 (draft art 5).

  141. 141.

    European Economic and Social Committee, Opinion of the European Economic and Social Committee on the [3 rd Maritime Safety Package] (2006), para 4.7.2.

  142. 142.

    Council of the European Union, Statement of the Council’s Reasons: Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008), p 3.

  143. 143.

    1976 Convention, art 21; see above note 84.

  144. 144.

    European Commission, Communication from the Commission to the European Parliament pursuant to the second subparagraph of Article 251(2) of the EC Treaty concerning the common position of the Council on the adoption of a Directive on the civil liability and financial guarantees of shipowners (9 December 2008), 4.

  145. 145.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 2(1).

  146. 146.

    1976 Convention, art 15(2)(a). See also art 6(5).

  147. 147.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 3(a).

  148. 148.

    1976 Convention, art 15(2)(b).

  149. 149.

    For example: “a ship falling within the scope of [SOLAS and MARPOL]”, Directive 2009/15/EC of 23 April 2009 on common rules and standards for ship inspection and survey organisations and for the relevant activities of maritime administrations, art 2(a); Regulation No 391/2009 of 23 April 2009 on common rules and standards for ship inspection and survey organisations, art 2(a); “any seagoing vessel to which one or more of the Conventions apply, flying a flag other than that of the flag State”, Directive 2009/16/EC of 23 April 2009 on port State control, art 2(5); “a seagoing vessel of any type whatsoever operating in the marine environment and shall include hydrofoil boats, air-cushion vehicles, submersibles and floating craft”, Directive 2000/59/EC of 27 November 2000 on port reception facilities for ship-generated waste and cargo residues, art 2(a); “any seagoing vessel or craft”, Directive 2002/59/EC of 27 June 2002 establishing a Community vessel traffic monitoring and information system and repealing Council Directive 93/75/EC, art 3(f); “a seagoing vessel, irrespective of its flag, of any type whatsoever operating in the marine environment and shall include hydrofoil boats, air-cushion vehicles, submersibles and floating craft”, Directive 2005/35/EC of 7 September 2005 on ship-source pollution and on the introduction of penalties for infringements, art 2(4); “a ship or craft flying the flag of a Member State falling within the scope of the relevant IMO Conventions, and for which a certificate is required”, Directive 2009/21/EC of 23 April 2009 on compliance with flag State requirements, art 3(a).

  150. 150.

    For example: “Fishing vessels, … wooden ships of a primitive build, … and pleasure yachts not engaged in trade shall be excluded from the scope of this Directive”, Directive 2009/16/EC of 23 April 2009 on port State control, art 3(4); see similarly Directive 2000/59/EC of 27 November 2000 on port reception facilities for ship-generated waste and cargo residues, art 3; Directive 2002/59/EC of 27 June 2002 establishing a Community vessel traffic monitoring and information system and repealing Council Directive 93/75/EC, art 2(2); Directive 2009/18/EC of 23 April 2009 establishing the fundamental principles governing the investigation of accidents in the maritime transport sector and amending Council Directive 1999/35/EC and Directive 2002/59/EC of the European Parliament and of the Council, art 2(2).

  151. 151.

    Such vessels have been defined as any “ship other than those which navigate exclusively in inland waters or in waters within, or closely adjacent to, sheltered waters or areas where port regulations apply”: Directive 2008/106/EC of 19 November 2008 on the minimum level of training of seafarers, art 1(11).

  152. 152.

    See Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, recitals 1 and 4.

  153. 153.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 5(1).

  154. 154.

    See Directive 1997/70/EC of 11 December 1997 setting up a harmonised safety regime for fishing vessels of 24 m in length and over.

  155. 155.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 10.

  156. 156.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 3(a).

  157. 157.

    1976 Convention, art 1(2).

  158. 158.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 2.

  159. 159.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 12 (draft art 2).

  160. 160.

    European Union, Committee of the Regions, Opinion of the Committee of the Regions on the 3 rd Maritime Safety Package (2006), 50.

  161. 161.

    Council of the European Union, Statement of the Council’s Reasons: Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008).

  162. 162.

    See 1976 Convention, art 9(1)(a) and (2).

  163. 163.

    Another distinction between the 1976 Convention and the Insurance Directive is that the former allows salvors to limit their liability, whereas the latter does not expressly place a compulsory insurance requirement upon them. Arguably a salvor taking a vessel into port could be deemed responsible for its operation in terms of the Directive, but it would be difficult to argue that it should therefore be classed as the shipowner for insurance purposes if the registered owner or charterer is still available. See 1976 Convention, art 1(1) and (3).

  164. 164.

    Gold, Gard Handbook on P&I Insurance (2002), 124.

  165. 165.

    See Hazelwood and Semark, P&I Clubs: Law and Practice (2010), 79–82; Gold, Gard Handbook on P&I Insurance (2002), 124–125.

  166. 166.

    Bunkers Convention, arts 3, 6 and 7. The registered owner is responsible for the insurance, while the definition of the liable shipowner is wider. See Røsæg, “Compulsory Maritime Insurance” (2000), 193.

  167. 167.

    Røsæg, “Compulsory Maritime Insurance” (2000), 180.

  168. 168.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 4(3).

  169. 169.

    1976 Convention, art 2.

  170. 170.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 13 (draft arts 1 and 6).

  171. 171.

    European Parliament, Transport and Tourism Committee, Report on the proposal for a directive of the European Parliament and of the Council on the civil liability and financial guarantees of shipowners (6 March 2007), 19. Regulation 2.5 of the Maritime Labour Convention (23 February 2006), soon to be in force, requires financial security to be provided by flag states to ensure the repatriation of seafarers.

  172. 172.

    European Parliament, European Parliament legislative resolution of 29 March 2007 on the proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (29 March 2007), 9 (draft art 8). See also Maritime Labour Convention (23 February 2006), regs 2.5, 4.1 and 4.2.

  173. 173.

    European Commission, Amended Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (24 October 2007), 3; International Maritime Organization, Guidelines on Provision of Financial Security in case of Abandoned Seafarers (17 December 2001). See also Maritime Labour Convention (23 February 2006), reg 2.2.

  174. 174.

    Council of the European Union, Statement of the Council’s Reasons: Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008), 3.

  175. 175.

    See Hazelwood and Semark, P&I Clubs: Law and Practice (2010), ch 9; Gold, Gard Handbook on P&I Insurance (2002), 114–117.

  176. 176.

    Hazelwood and Semark, P&I Clubs: Law and Practice (2010), 209; Gold, Gard Handbook on P&I Insurance (2002), 81–83.

  177. 177.

    Gold, Gard Handbook on P&I Insurance (2002), 82.

  178. 178.

    See Damar, “Compulsory Insurance in International Maritime Conventions” (2009), 162–163.

  179. 179.

    See Gard P&I, The Athens Convention/EU Passenger Liability Regulation (November 2012).

  180. 180.

    See for example: Oil Pollution Convention, art VII(8); HNS Convention, art 12(8); Bunkers Convention, art 7(10); Wreck Removal Convention, art 12(10); Athens Convention, art 4bis(10).

  181. 181.

    Røsæg, “Compulsory Maritime Insurance” (2000), 189–190; see also Røsæg, “Multinational Transport Company Groups Above and Beyond Nation States: How Does the Law Respond to That?” (2009), 22–23.

  182. 182.

    Soyer, “Sundry Considerations on the Draft Protocol to the Athens Convention Relating to the Carriage of Passengers and their Luggage by Sea 1974” (2002), 528.

  183. 183.

    Røsæg, “Compulsory Maritime Insurance” (2000), 189–190; see also Gold, Gard Handbook on P&I Insurance (2002), 463.

  184. 184.

    Gold, Gard Handbook on P&I Insurance (2002), 75.

  185. 185.

    Nicolas Tsavliris, “Salvage: the P&I clubs may not have it covered” (Lloyd’s List, 3 June 2009); Haco van der Houven van Oordt, “Third EU safety package poses protection question” (Lloyd’s List, 20 January 2010).

  186. 186.

    Griggs, “Developing a Comprehensive Third-Party Liability Convention” (2010), 348–349.

  187. 187.

    See Jonathan Hare “Existing conventions offer enough protection” (Lloyd’s List, 28 January 2010).

  188. 188.

    See below Sect. 5.4.2.1.

  189. 189.

    See for example New Zealand’s Law Reform Act 1936, s 9.

  190. 190.

    See Chap. 3, Sect. 3.3.3.3.

  191. 191.

    For discussion of this category in relation to employment matters see Chap. 6, Sect. 6.4.2.

  192. 192.

    Jennings, “Extraterritorial Jurisdiction and the United States Antitrust Laws” (1957), 154; Røsæg, “Multinational Transport Company Groups Above and Beyond Nation States: How Does the Law Respond to That?” (2009), 18–19.

  193. 193.

    Conversely, the potential to arrest a vessel in port is certainly a powerful means of influencing a vessel owner regardless of how complex and diffuse their corporate structure might be: Røsæg, “Multinational Transport Company Groups Above and Beyond Nation States: How Does the Law Respond to That?” (2009), 16–17.

  194. 194.

    SOLAS, ch IX, reg 2(1). Valenzuela suggested that this shift from flag state- to ownership-focused compliance “may well in time prove to be the most revolutionary change adopted by IMO during its 40 years of existence”: Valenzuela, “Enforcing Rules against Vessel-Source Degradation of the Marine Environment: Coastal, Flag and Port State Jurisdiction” (1999), 502.

  195. 195.

    SOLAS, ch IX, regs 1(2) and 6(1).

  196. 196.

    See SOLAS, ch XI-2.

  197. 197.

    Maritime Labour Convention (23 February 2006), art V(5) and reg 5.3.

  198. 198.

    UNCLOS, art 94(1) and (2) (emphasis added). There is no suggestion in UNCLOS that administrative matters form a separate legal category. The term “administrative” is used only in its broad, descriptive sense.

  199. 199.

    Nandan and Rosenne, United Nations Convention on the Law of the Sea 1982: A Commentary (vol III, 1995), 152. One exception is arguably the granting of nationality to a vessel by its flag state. This appears to be an aspect of flag state jurisdiction that a port or coastal state cannot supersede, no matter how closely associated the vessel is with their jurisdiction: see Chap. 6 Sect. 6.7.1.

  200. 200.

    Collins (ed), Dicey, Morris and Collins on the Conflict of Laws (2012), 2002. The characteristic performance is the provision of cover (i.e. through the payment of money) in response to a claim.

  201. 201.

    Each of these conventions involves an element of port state control: Athens Convention, art 4bis(13); Wreck Removal Convention, art 12(12); Bunkers Convention, art 7(12); HNS Convention, art 12(11); Oil Pollution Convention, art VII(11).

  202. 202.

    See Chap. 4, Sect. 4.1.2.4.

  203. 203.

    46 USC 3507(g); see United States Coast Guard, http://www.uscg.mil/hq/cg2/cgis/CruiseLine.asp.

  204. 204.

    46 USC 3507(g)(4)(A).

  205. 205.

    United States Coast Guard, Cruise Vessel Security and Safety Act (CVSSA) of 2010 Statistical Compilation (1 April 2011 to 30 June 2011).

  206. 206.

    46 USC 3507(g)(4)(B). See for example Carnival Cruise Lines, http://www.carnival.com/cms/fun/cruise_control/security_safety_act.aspx.

  207. 207.

    Such companies may of course avoid the requirement by not visiting any United States ports.

  208. 208.

    Ogus, Regulation: Legal Form and Economic Theory (1994), 150–151; Baldwin and Cave, Understanding Regulation: Theory, Strategy, and Practice (1999), 49–50.

  209. 209.

    46 USC 3507(g)(3).

  210. 210.

    See Chap. 6, Sect. 6.7.

  211. 211.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 6.

  212. 212.

    Directive 2009/16/EC of 23 April 2009 on port State control, art 13(1)(a) and Annex IV.

  213. 213.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 6.

  214. 214.

    Referring to this possibility see Steel, “Ships are Different: The Case for Limitation of Liability” (1995), 81.

  215. 215.

    European Commission, Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (23 November 2005), 13–15 (draft arts 5, 7 and 8).

  216. 216.

    European Economic and Social Committee, Opinion of the European Economic and Social Committee on the [3 rd Maritime Safety Package] (2006), para 4.7.4.3.

  217. 217.

    European Parliament, Transport and Tourism Committee, Report on the proposal for a directive of the European Parliament and of the Council on the civil liability and financial guarantees of shipowners (6 March 2007), 13.

  218. 218.

    European Parliament, Transport and Tourism Committee, Report on the proposal for a directive of the European Parliament and of the Council on the civil liability and financial guarantees of shipowners (6 March 2007), 14.

  219. 219.

    European Parliament, Transport and Tourism Committee, Report on the proposal for a directive of the European Parliament and of the Council on the civil liability and financial guarantees of shipowners (6 March 2007), 15.

  220. 220.

    European Commission, Amended Proposal for a Directive of the European Parliament and the Council on the civil liability and financial guarantees of shipowners (24 October 2007), 4.

  221. 221.

    Council of the European Union, Statement of the Council’s Reasons: Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008), 3.

  222. 222.

    Council of the European Union, Statement of the Council’s Reasons: Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008), 4.

  223. 223.

    See International Maritime Organization, Guidelines for the Authorization of Organizations Acting on Behalf of the Administration (4 November 1993). In practice classification societies often fulfil this role: see for example UK P&I Club, Flag State Summary – Hong Kong (31 August 2010), available at www.ukpandi.com, noting that Hong Kong had delegated the issuing of certificates under the Bunkers Convention to the China Classification Society and the Korean Registry of Shipping.

  224. 224.

    Bunkers Convention, art 7(1); Athens Convention, art 4bis(1); Wreck Removal Convention, art 12(1); HNS Convention, art 12(1); see similarly Oil Pollution Convention, art VII(1).

  225. 225.

    See Røsæg, “Compulsory Maritime Insurance” (2000), 195–200; Damar, “Compulsory Insurance in International Maritime Conventions” (2009), 157–160.

  226. 226.

    Bunkers Convention, art 7(12); Athens Convention, art 4bis(13); Wreck Removal Convention, art 12(12); HNS Convention, art 12(13); Oil Pollution Convention, art VII(11).

  227. 227.

    International Maritime Organization, Summary of Status of Conventions (6 March 2013).

  228. 228.

    See Røsæg, “Compulsory Maritime Insurance” (2000), 194; Zhu, Compulsory Insurance and Compensation for Bunker Oil Pollution Damage (2007), 112–118.

  229. 229.

    See Directive 2009/16/EC of 23 April 2009 on port State control, art 22 and annex XI.

  230. 230.

    See Zhu, Compulsory Insurance and Compensation for Bunker Oil Pollution Damage (2007), 116.

  231. 231.

    Bunkers Convention, art 7(6); Athens Convention, art 4bis(6); Wreck Removal Convention, art 12(6); HNS Convention, art 12(5); Oil Pollution Convention, art VII(5).

  232. 232.

    This represents a divergence in enforcement procedures within a system that is supposed to rely on cooperation and conformity to accepted standards, and may become an issue to watch if the EU continues its ambitious regime of maritime regulation.

  233. 233.

    See Paris MOU, annexes 7, 8 and 11.

  234. 234.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 5(2).

  235. 235.

    Directive 2009/20/EC of 23 April 2009 on the insurance of shipowners for maritime claims, art 7.

  236. 236.

    Council of the European Union Statement of the Council’s Reasons: Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008, 14287/08 ADD 1), 5.

  237. 237.

    Directive 2009/16/EC of 23 April 2009 on port State control, art 19.

  238. 238.

    Directive 2009/16/EC of 23 April 2009 on port State control, art 16.

  239. 239.

    See Chap. 3, Sect. 3.1.3.

  240. 240.

    See Directive 1999/35/EC of 29 April 1999 on a system of mandatory surveys for the safe operation of regular ro-ro ferry and high-speed passenger craft services, art 10.

  241. 241.

    If the vessel finds itself in distress, for example, the absence of an insurance certificate does not provide sufficient reason in itself to deny that vessel access to Member States’ designated places of refuge: Directive 2002/59/EC of 27 June 2002 establishing a Community vessel traffic monitoring and information system and repealing Council Directive 93/75/EC, art 20c(1).

  242. 242.

    Council of the European Union, Statement of the Council’s Reasons: Common Position adopted by the Council with a view to the adoption of a Directive of the European Parliament and of the Council on the insurance of shipowners for maritime claims (24 November 2008), 3.

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    Bevan Marten

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Marten, B. (2014). Port States Behind the Scenes: The European Union’s 2009 Insurance Directive. In: Port State Jurisdiction and the Regulation of International Merchant Shipping. Hamburg Studies on Maritime Affairs, vol 26. Springer, Cham. https://doi.org/10.1007/978-3-319-00351-1_5

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