OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        1
CHAPTER 351
OIL POLLUTION (LIABILITY AND 
COMPENSATION) ACT
 To provide for Malta’s accession to the 1969 International Convention
on Civil Liability for Oil Pollution Damage and the 1971 International
Convention on the Establishment of an International Fund for
Compensation for Oil Pollution Damage, and for the implementation of the
provisions of these Conventions.
(9th September, 1991)
(26th December, 1991) *
Enacted by ACT XV of 1991 as amended by Act XXIV of 1995.
Short title.
Compensation) Act.
Interpretation.
"Conventions" means the Fund Convention and the Liability
Convention;
"Fund Convention" means the International Convention on the
Establishment of an International Fund for Compensation for Oil
Pollution Damage, adopted at Brussels on 18 December, 1971, as
amended by the Protocol thereto done in London on the 19
November, 1976; 
"IOPC Fund" means the International Oil Pollution
Compensation Fund established under the provisions of the Fund
Convention;
"Liability Convention" means the International Convention on
Civil Liability for Oil Pollution Damage adopted at Brussels on 29
November, 1969, as amended by the Protocol thereto done at
London on the 19 November, 1976;
"Minister" means the Minister responsible for shipping;
Cap. 234.
"Registrar-General" means the Registrar-General of Shipping
and Seamen appointed under section 363 of the Merchant Shipping
Act and includes any person acting under his authority;
Cap. 226.
"territorial waters of Malta" shall have the same meaning as is
assigned to the term in the Territorial Waters and Contiguous Zone
Act.
(2) In this Act and in any regulations made thereunder, if there
is any conflict between the English and Maltese text, the English
text shall prevail.
(3) Unless the context otherwise requires words and
expressions used in this Act shall have the same meaning assigned
to them in the Conventions.
* See  subsection (2) of section 1 of the Act as originally enacted, which subsection has
been omitted under the Statute Law Revision Act, 1980, and Legal Notices 135 and
189 of 1991.
  2      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
Ratification of 
Conventions.
3. For the purposes of any law thereto applicable the
Government of Malta is hereby authorised to accede to the Fund
Convention and the Liability Convention.
Certain provisions 
of the Liability 
Convention given 
force of law in 
Malta.
Amended by: 
XXIV.1995.362.
4. (1) Subject to the provisions of subsections (2) to (5) of
this section and notwithstanding the provisions of any other law,
the provisions of articles I to XI of the Liability Convention, which
articles are reproduced in the First Schedule to this Act, shall form
part of and be enforceable as part of the Law of Malta.
(2) Where any action is being brought in Malta in terms of the
provisions of the Liability Convention any reference in that
convention to "the Court", or to "the Court or other competent
authority", shall in each case be read and construed as reference to
the Civil Court, First Hall.
Cap. 12.
(3) Where pollution damage, resulting from an incident has
been sustained in Malta, including the territorial waters of Malta, or
if measures have been taken to prevent or minimise such damage in
that area, action for compensation under the provisions of the
Liability Convention shall be brought in Malta before the Civil
Court, First Hall, by presenting a claim before such court. Such a
claim shall be instituted in accordance with subtitle III of Title VIII
of Part I of Book Second of the Code of Organization and Civil
Procedure.
(4) The Civil Court, First Hall, shall determine the distribution
of the limitation fund, and where such fund is insufficient to satisfy
the claims of those who are entitled to compensation, the amount of
compensation of each claimant shall be reduced  pro rata .
(5) The appropriate authority for the purpose of issuing a
certificate of insurance in respect of Maltese ships, or in respect of
ships flying the flag of a State not party to the Liability Convention
that enter or leave any port in Malta, shall be the Registrar-General
who shall, for the purposes of paragraph 6 of article VII of that
convention and subject to the provisions of that same convention
and of any regulations made under this Act, determine the
conditions of issue and validity of such certificate.
Certain provisions 
of the Fund 
Convention given 
force of law in 
Malta.
Amended by: 
XXIV.1995.362 .
5. (1) Subject to the provisions of subsections (2) to (6) of
this section, the provisions of articles 1 to 15 of the Fund
Convention, which articles are reproduced in the Second Schedule
to this Act, shall form part of and be enforceable as part of the Law
of Malta.
(2) Any person who in a calendar year has received
contributing oil so as to be liable to contribute to the IOPC Fund
pursuant to article 10 of the Fund Convention, shall, not later than
the 1 March of the following year, inform the Minister of the
quantity of such oil received by him.
(3) The Minister shall, at a time and in the manner prescribed
in the Internal Regulations of the IOPC Fund, communicate the
information mentioned in paragraph 2 of article 15 of the Fund
Convention to the Director of the IOPC Fund.
(4) ( a ) For the purposes of this subsection "associated person"
OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        3
means a company or other body corporate which in either case is
another company’s subsidiary, associate or holding company, or is
the manager of or managed by, or otherwise controls or is
controlled by that body corporate or a subsidiary or associate of
that body corporate’s holding company - and associate of a body
corporate means a body corporate being the subsidiary of the same
holding company.
( b ) Any person having received in a calendar year contributing
oil in ports or other installations in Malta in the manner specified in
sub-paragraphs ( a ) and ( b ) of paragraph 1 of article 10 of the Fund
Convention in total quantities exceeding 150,000 tonnes shall pay
contributions to the IOPC Fund in accordance with articles 10 to 13
of that convention in the amount and by the date determined by the
IOPC Fund Assembly:
Provided that, notwithstanding that the quantity received in
Malta in a calendar year by any such person does not exceed
150,000 tonnes but when aggregated with the quantity of
contributing oil received in the same calendar year in Malta by any
associated person or persons exceeds 150,000 tonnes, such person
shall pay contributions in respect of the actual quantity received by
him.
(5) Where pollution damage resulting from an incident has
been sustained in Malta, including the territorial waters of Malta, or
if measures have been taken to prevent or minimise such damage in
that area, any action against the IOPC Fund for compensation under
article 4 of the Fund Convention or for indemnification under
article 5 of that same convention shall be brought in Malta before
the Civil Court, First Hall.
(6) The notification to the IOPC Fund under paragraph 6 of
article 7 of the Fund Convention shall be made by means of a
judicial act against the IOPC Fund and notified in the office of the
Minister.
(7) The IOPC Fund shall be entitled to take action against
defaulting contributors before the Civil Court, First Hall.
Procedure. 
Amended by: 
XXIV.1995.362.
6. Notwithstanding the provisions of any other law -
( a ) the Civil Court, First Hall, shall have jurisdiction to
try and determine cases and actions that in accordance
with this Act are to be brought before it;
( b ) when a written pleading or other judicial act is to be
filed against the IOPC Fund, it shall be sufficient if in
such pleading or act there is designated the IOPC Fund
and it shall not be necessary in such pleading or act to
name the office or the name of the person for the time
being holding the office having, in accordance with the
constitution of the IOPC Fund, the judicial
representation of that Fund;
( c ) the pleadings and acts referred to in paragraph ( b ) of
this section shall be notified at the office of the
Minister who shall within five working days transmit
  4      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
the same to the headquarters of the IOPC Fund through
the Ministry responsible for foreign affairs;
( d ) all judicial terms for the filing of any written pleadings
or other acts by the IOPC Fund shall be extended by
five working days and no such times may be abridged
to less than five working days.
Power to make 
regulations, etc.
 7. (1) The Minister may make regulations, rules or orders, or
give instructions, as are necessary for carrying into effect the
provisions of the Liability Convention or the Fund Convention.
(2) Regulations, rules and orders made under any of the
provisions of this Act, may be made in the English language only.
Language of 
Schedules.
8. The Schedules to this Act shall be in the English language
only, and such text shall apply also to the Maltese text of this Act.
OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        5
FIRST SCHEDULE 
(Sections 4 and 8)
Text of articles I to XI of the 1969 International Convention on Civil Liability 
for Oil Pollution Damage as amended by the 1976 Protocol thereto
 Article I
For the purposes of this Convention:
1. "Ship" means any sea-going vessel and any seaborne craft of any type
whatsoever, actually carrying oil in bulk as cargo.
2. "Person" means any individual or partnership or any public or private body,
whether corporate or not, including a State or any of its constituent subdivisions.
3. "Owner" means the person or persons registered as the owner of the ship or,
in the absence of registration, the person or persons owning the ship. However in the
case of a ship owned by a State and operated by a company which in that State is
registered as the Ships’ operator, "owner" shall mean such company.
4. "State of the ship’s registry" means in relation to registered ships the State
of registration of the ship, and in relation to unregistered ships the State whose flag
the ship is flying.
5. "Oil" means any persistent oil such as crude oil, fuel oil, heavy diesel oil,
lubricating oil and whale oil, whether carried on board a ship as cargo or in the
bunkers of such a ship.
6. "Pollution damage" means loss or damage caused outside the ship carrying
oil by contamination resulting from the escape or discharge of oil from the ship,
wherever such escape or discharge may occur, and includes the costs of preventive
measures and further loss or damage caused by preventive measures.
7. "Preventive measures" means any reasonable measures taken by any person
after an incident has occurred to prevent or minimize pollution damage.
8. "Incident" means any occurrence, or series of occurrences having the same
origin, which causes pollution damage.
9. "Organization" means the Inter-Governmental Maritime Consultative
Organization.
Article II
This Convention shall apply, exclusively to pollution damage caused on the
territory including the territorial sea of a Contracting State and to preventive
measures taken to prevent or minimize such damage.
Article III
1. Except as provided in paragraphs 2 and 3 of this Article, the owner of a ship
at the time of an incident, or where the incident consists of a series of occurrences at
the time of the first such occurrence, shall be liable for any pollution damage caused
by oil which has escaped or been discharged from the ship as a result of the incident.
2. No liability for pollution damage shall attach to the owner if he proves that
  6      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
the damage:
( a ) resulted from an act of war, hostilities, civil war, insurrection or a
natural phenomenon of an exceptional, inevitable and irresistible
character, or
( b ) was wholly caused by an act or omission done with intent to cause
damage by a third party, or
( c ) was wholly caused by the negligence or other wrongful act of any
Government or other authority responsible for the maintenance of lights
or other navigational aids in the exercise of that function.
3. If the owner proves that the pollution damage resulted wholly or partially
either from an act or omission done with intent to cause damage by the person who
suffered the damage or from the negligence of that person, the owner may be
exonerated wholly or partially from his liability to such person.
4. No claim for compensation for pollution damage shall be made against the
owner otherwise than in accordance with this Convention. No claim for pollution
damage under this Convention or otherwise may be made against the servants or
agents of the owner.
5. Nothing in this Convention shall prejudice any right of recourse of the
owner against third parties.
Article IV
When oil has escaped or has been discharged from two or more ships, and
pollution damage results therefrom, the Owners of all the ships concerned, unless
exonerated under Article III, shall be jointly and severally liable for all such damage
which is not reasonably separable.
Article V
1. The owner of a ship shall be entitled to limit his liability under this
Convention in respect of any one incident to an aggregate amount of 133 units of
account for each ton of the ship’s tonnage. However, this aggregate amount shall not
in any event exceed 14 million units of account.
2. If the incident occurred as a result of the actual fault or privity of the owner,
he shall not be entitled to avail himself of the limitation provided in paragraph 1 of
this Article.
3. For the purpose of availing himself of the benefit of limitation provided for
in paragraph 1 of this Article the owner shall constitute a fund for the total sum
representing the limit of his liability with the Court or other competent authority of
any one of the Contracting States in which action is brought under Article IX. The
fund can be constituted either by depositing the sum or by producing a bank
guarantee or other guarantee acceptable under the legislation of the Contracting
State where the fund is constituted, and considered to be adequate by the Court or
another competent authority.
4. The fund shall be distributed among the claimants in proportion to the
amounts of their established claims.
5. If before the fund is distributed the owner or any of his servants or agents or
any person providing him insurance or other financial security has as a result of the
OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        7
incident in question, paid compensation for pollution damage, such person shall, up
to the amount he has paid, acquire by subrogation the rights which the person so
compensated would have enjoyed under this Convention.
6. The right of subrogation provided for in paragraph 5 of this Article may also
be exercised by a person other than those mentioned therein in respect of any amount
of compensation for pollution damage which he may have paid but only to the extent
that such subrogation is permitted under the applicable national law.
7. Where the owner or any other person establishes that he may be compelled
to pay at a later date in whole or in part any such amount of compensation, with
regard to which such person would have enjoyed a right of subrogation under
paragraphs 5 or 6 of this Article, had the compensation been paid before the fund
was distributed, the Court or other competent authority of the State where the fund
has been constituted may order that a sufficient sum shall be provisionally set aside
to enable such person at such later date to enforce his claim against the fund.
8. Claims in respect of expenses reasonably incurred or sacrifices reasonably
made by the owner voluntarily to prevent or minimize pollution damage shall rank
equally with other claims against the fund.
9. ( a ) The "unit of account" referred to in paragraph 1 of this Article is the
Special Drawing Right as defined by the International Monetary Fund. The amounts
mentioned in paragraph 1 shall be converted into the national currency of the State in
which the fund is being constituted on the basis of the value of that currency by
reference to the Special Drawing Right on the date of the constitution of the fund.
The value of the national currency, in terms of the Special Drawing Right, of a
Contracting State which is a member of the International Monetary Fund, shall be
calculated in accordance with the method of valuation applied by the International
Monetary Fund in effect at the date in question for its operations and transactions.
The value of the national currency, in terms of the Special Drawing Right, of a
Contracting State which is not a member of the International Monetary Fund, shall
be calculated in a manner determined by that State.
9. ( b ) Nevertheless, a Contracting State which is not a member of the
International Monetary Fund and whose law does not permit the application of the
provisions of paragraph 9 ( a )   of this article may, at the time of ratification,
acceptance, approval of or accession to the present Convention, or at any time
thereafter, declare that the limits of liability provided for in paragraph 1 to be
applied in its territory shall, in respect of any one incident, be an aggregate of 2,000
monetary units for each ton of the ship’s tonnage provided that this aggregate
amount shall not in any event exceed 210 million monetary units. The monetary unit
referred to in this paragraph corresponds to sixty-five and a half milligrammes of
gold of millisimal fineness nine hundred. The conversion of these amounts into the
national currency shall be made according to the law of the State concerned.
9. ( c ) The calculation mentioned in the last sentence of paragraph 9 ( a ) and the
conversion mentioned in paragraph 9 ( b ) shall be made in such a manner as to
express in the national currency of the Contracting State as far as possible the same
real value for the amounts in paragraph 1 as is expressed there in units of account.
Contracting States shall communicate to the depositary the manner of calculation
pursuant to paragraph 9   ( a ), or the result of the conversion in paragraph 9 ( b ) as the
case may be, when depositing an instrument referred to in Article IV and whenever
there is a change in either.
10. For the purpose of this Article the ship’s tonnage shall be the net tonnage of
the ship with the addition of the amount deducted from the gross tonnage on account
of engine room space for the purpose of ascertaining the net tonnage. In the case of a
  8      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
ship which cannot be measured in accordance with the normal rules of tonnage
measurement, the ship’s tonnage shall be deemed to be 40 per cent of the weight in
tons (of 2,240 lbs.) of oil which the ship is capable of carrying.
11. The insurer or other person providing financial security shall be entitled to
constitute a fund in accordance with this Article on the same conditions and having
the same effect as if it were constituted by the owner. Such a fund may be constituted
even in the event of the actual fault or privity of the owner but its constitution shall
in that case not prejudice the rights of any claimant against the owner.
Article VI
1. Where the owner, after an incident, has constituted a fund in accordance
with Article V, and is entitled to limit his liability,
( a ) no person having a claim for pollution damage arising out of that
incident shall be entitled to exercise any right against any other assets of
the owner in respect of such claim;
( b ) the Court or other competent authority of any Contracting State shall
order the release of any ship or other property belonging to the owner
which has been arrested in respect of a claim for pollution damage
arising out of that incident, and shall similarly release any bail or other
security furnished to avoid such arrest.
2. The foregoing shall, however, only apply if the claimant has access to the
Court administering the fund and the fund is actually available in respect of his
claim. 
Article VII
1. The owner of a ship registered in a Contracting State and carrying more than
2,000 tons of oil in bulk as cargo shall be required to maintain insurance or other
financial security, such as the guarantee of a bank or a certificate delivered by an
international compensation fund, in the sums fixed by applying the limits of liability
prescribed in Article V, paragraph 1 to cover his liability for pollution damage under
this Convention.
2. A certificate attesting that insurance or other financial security is in force in
accordance with the provisions of this Convention shall be issued to each ship. It
shall be issued or certified by the appropriate authority of the State of the ship’s
registry after determining that the requirements of paragraph 1 of this Article have
been complied with. This certificate shall be in the form of the annexed model and
shall contain the following particulars:
( a ) name of ship and port of registration;
( b ) name and principal place of business of owner; 
( c ) type of security;
( d ) name and principal place of business of insurer or other person giving
security and, where appropriate, place of business where the insurance
or security is established;
( e ) period of validity of certificate which shall not be longer than the period
of validity of the insurance or other security.
3. The certificate shall be in the official language or languages of the issuing
OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        9
State. If the language used is neither English nor French, the text shall include a
translation into one of these languages.
4. The certificate shall be carried on board the ship and a copy shall be
deposited with the authorities who keep the record of the ship’s registry.
5. An insurance or other financial security shall not satisfy the requirements of
this Article if it can cease, for reasons other than the expiry of the period of validity
of the insurance or security specified in the certificate under paragraph 2 of this
Article, before three months have elapsed from the date on which notice of its
termination is given to the authorities referred to in paragraph 4 of this Article,
unless the certificate has been surrendered to these authorities or a new certificate
has been issued within the said period. The foregoing provisions shall similarly
apply to any modification which results in the insurance or security no longer
satisfying the requirements of this Article.
6. The State of registry shall, subject to the provisions of this Article,
determine the conditions of issue and validity of the certificate.
7. Certificates issued or certified under the authority of a Contracting State
shall be accepted by other Contracting States for the purposes of this convention and
shall be regarded by other Contracting States as having the same force as certificates
issued or certified by them. A Contracting State may at any time request consultation
with the State of a ship’s registry should it believe that the insurer or guarantor
named in the certificate is not financially capable of meeting the obligations imposed
by this Convention.
8. Any claim for compensation for pollution damage may be brought directly
against the insurer or other person providing financial security for the owner’s
liability for pollution damage. In such case the defendant may, irrespective of the
actual fault or privity of the owner, avail himself of the limits of liability prescribed
in Article V, paragraph 1. He may further avail himself of the defences (other than
the bankruptcy or winding up of the owner) which the owner himself would have
been entitled to invoke. Furthermore, the defendant may avail himself of the defence
that the pollution damage resulted from the wilful misconduct of the owner himself,
but the defendant shall not avail himself of any other defence which he might have
been entitled to invoke in proceedings brought by the owner against him. The
defendant shall in any event have the right to require the owner to be joined in the
proceedings.
9. Any sums provided by insurance or by other financial security maintained in
accordance with paragraph 1 of this Article shall be available exclusively for the
satisfaction of claims under this Convention.
10. A Contracting State shall not permit a ship under its flag to which this
Article applies to trade unless a certificate has been issued under paragraph 2 or 12
of this Article.
11. Subject to the provisions of this Article, each Contracting State shall ensure,
under its national legislation, that insurance or other security to the extent specified
in paragraph 1 of this Article is in force in respect of any ship, wherever registered,
entering or leaving a port in its territory, or arriving at or leaving an off-shore
terminal in its territorial sea, if the ship actually carries more than 2,000 tons of oil
in bulk as cargo.
12. If insurance or other financial security is not maintained in respect of a ship
owned by a Contracting State, the provisions of this Article relating thereto shall not
be applicable to such ship, but the ship shall carry a certificate issued by the
appropriate authorities of the State of the ship’s registry stating that the ship is
  10      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
owned by that State and that the ship’s liability is covered within the limits
prescribed by Article V, paragraph 1. Such a certificate shall follow as closely as
practicable the model prescribed by paragraph 2 of this Article.
Article VIII
Rights of compensation under this Convention shall be extinguished unless an
action is brought thereunder within three years from the date when the damage
occurred. However, in no case shall an action be brought after six years from the
date of the incident which caused the damage. Where this incident consists of a
series of occurrences, the six years’ period shall run from the date of the first such
occurrence.
Article IX
1. Where an incident has caused pollution damage in the territory including the
territorial sea of one or more Contracting States, or preventive measures have been
taken to prevent or minimize pollution damage in such territory including the
territorial sea, actions for compensation may only be brought in the Courts of any
such Contracting State or States. Reasonable notice of any such action shall be given
to the defendant.
2. Each Contracting State shall ensure that its Courts possess the necessary
jurisdiction to entertain such actions for compensation.
3. After the fund has been constituted in accordance with Article V the Courts
of the State in which the fund is constituted shall be exclusively competent to
determine all matters relating to the appointment and distribution of the fund.
Article X
1. Any judgement given by a Court with jurisdiction in accordance with Article
IX which is enforceable in the State of origin where it is no longer subject to
ordinary forms of review, shall be recognized in any Contracting State, except:
( a ) where the judgment was obtained by fraud; or
( b ) where the defendant was not given reasonable notice and a fair
opportunity to present his case.
2. A judgment recognized under paragraph 1 of this Article shall be
enforceable in each Contracting State as soon as the formalities required in that State
have been complied with. The formalities shall not permit the merits of the case to
be re-opened.
Article XI
1. The provisions of this Convention shall not apply to warships or other ships
owned or operated by a State and used for the time being, only on Government non-
commercial service.
2. With respect to ships owned by a Contracting State and used for commercial
purposes, each State shall be subject to suit in the jurisdictions set forth in Article IX
and shall waive all defences based on its status as a sovereign State.
SECOND SCHEDULE 
OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        11
(Sections 5 and 8)
Text of articles 1 to 15 of the 1971 International Convention on the 
Establishment of an International Fund for Compensation for Oil Pollution 
Damage
General Provisions 
Article 1
For the purposes of this Convention:
1. "Liability Convention" means the International Convention on Civil
Liability for Oil Pollution Damage, adopted at Brussels on 29 November 1969.
2. "Ship", "Person", "Owner", "Oil", "Pollution Damage", "Preventive
Measures", "Incident" and "Organization", have the same meaning as in Article I of
the Liability Convention, provided however that, for the purposes of these terms,
"oil" shall be confined to persistent hydrocarbon mineral oils.
3. "Contributing Oil" means crude oil and fuel oil as defined in sub-paragraphs
( a )   and   ( b ) below:
( a ) "Crude Oil" means any liquid hydrocarbon mixture occurring naturally
in the earth whether or not treated to render it suitable for
transportation. It also includes crude oils from which certain distillate
fractions have been removed (sometimes referred to as "topped crudes")
or to which certain distillate fractions have been added (sometimes
referred to as "spiked" or "reconstituted" crudes).
( b ) "Fuel Oil" means heavy distillates or residues from crude oil or blends
of such materials intended for use as a fuel for the production of heat or
power of a quality equivalent to the "American Society for Testing and
Materials’ Specification for Number Four Fuel Oil (Designation D 396-
69)", or heavier.
4. "Unit of Account" or "Monetary Unit" means the unit of account or
monetary unit as the case may be, referred to in Article V of the Liability
Convention, as amended by the protocol thereto adopted on 19 November 1976.
5. "Ship’s tonnage" has the same meaning as in Article V, paragraph 10, of the
Liability Convention.
6. "Ton", in relation to oil, means a metric ton.
7. "Guarantor" means any person providing insurance or other financial
security to cover an owner’s liability in pursuance of Article VII, paragraph 1, of the
Liability Convention.
8. "Terminal Installation" means any site for the storage of oil in bulk which is
capable of receiving oil from waterborne transportation, including any facility
situated off-shore and linked to such site.
9. Where an incident consists of a series of occurrences, it shall be treated as
having occurred on the date of the first such occurrence.
Article 2
  12      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
1. An International Fund for compensation for pollution damage, to be named
"The International Oil Pollution Compensation Fund" and hereinafter referred to as
"The Fund", is hereby established with the following aims:
( a ) to provide compensation for pollution damage to the extent that the
protection afforded by the Liability Convention is inadequate;
( b ) to give relief to shipowners in respect of the additional financial burden
imposed on them by the Liability Convention, such relief being subject
to conditions designed to ensure compliance with safety at sea and other
conventions;
( c ) to give effect to the related purposes set out in this Convention.
2. The fund shall in each Contracting State be recognized as a legal person
capable under the laws of that State of assuming rights and obligations and of being
a party in legal proceedings before the courts of that State. Each Contracting State
shall recognize the Director of the Fund (hereinafter referred to as "The Director") as
the legal representative of the Fund.
Article 3 
This Convention shall apply:
1. With regard to compensation according to Article 4, exclusively to pollution
damage caused on the territory including the territorial sea of a Contracting State,
and to preventive measures taken to prevent or minimize such damage;
2. With regard to indemnification of shipowners and their guarantors according
to Article 5, exclusively in respect of pollution damage caused on the territory,
including the territorial sea, of a State Party to the Liability Convention by a ship
registered in or flying the flag of a Contracting State and in respect of preventive
measures taken to prevent or minimize such damage.
Compensation and indemnification 
Article 4
1. For the purpose of fulfilling its function under Article 2, paragraph 1( a ), the
Fund shall pay compensation to any person suffering pollution damage if such
person has been unable to obtain full and adequate compensation for the damage
under the terms of the Liability Convention,
( a ) because no liability for the damage arises under the Liability
Convention;
( b ) because the owner liable for the damage under the Liability Convention
is financially incapable of meeting his obligations in full and any
financial security that may be provided under Article VII of that
Convention does not cover or is insufficient to satisfy the claims for
compensation for the damage; an owner being treated as financially
incapable of meeting his obligations and a financial security being
treated as insufficient if the person suffering the damage has been
unable to obtain full satisfaction of the amount of compensation due
under the Liability Convention after having taken all reasonable steps to
pursue the legal remedies available to him;
( c ) because the damage exceeds the owner’s liability under the Liability
Convention as limited pursuant to Article V, paragraph 1, of that
OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        13
Convention or under the terms of any other international Convention in
force or open for signature, ratification or accession at the date of this
Convention.
Expenses reasonably incurred or sacrifices reasonably made by the owner
voluntarily to prevent or minimize pollution damage shall be treated as pollution
damage for the purposes of this Article.
2. The Fund shall incur no obligation under the preceding paragraph if:
( a ) it proves that the pollution damage resulted from an act of war,
hostilities, civil war or insurrection or was caused by oil which has
escaped or been discharged from a warship or other ship owned or
operated by a State and used, at the time of the incident only on
Government non-commercial service; or
( b ) the claimant cannot prove that the damage resulted from an incident
involving one or more ships.
3. If the Fund proves that the pollution damage resulted wholly or partially
either from an act or omission done with intent to cause damage by the person who
suffered the damage or from the negligence of that person, the Fund may be
exonerated wholly or partially from its obligation to pay compensation to such
person provided, however, that there shall be no such exoneration with regard to
such preventive measures which are compensated under paragraph 1. The Fund shall
in any event be exonerated to the extent that the shipowner may have been
exonerated under Article III, paragraph 3, of the Liability Convention.
4. ( a ) Except as otherwise provided in sub-paragraph ( b ) of this paragraph the
aggregate amount of compensation payable by the Fund under this Article shall in
respect of any one incident be limited, so that the total sum of that amount and the
amount of compensation actually paid under the Liability Convention for pollution
damage caused in the territory of the Contracting States, including any sums in
respect of which the Fund is under an obligation to indemnify the owner pursuant to
Article 5, paragraph 1, of this Convention, shall not exceed 30 million units of
account or 450 million monetary units.
( b ) The aggregate amount of compensation payable by the Fund under this
Article for pollution damage resulting from a natural phenomenon of an exceptional,
inevitable and irresistible character shall not exceed 30 million units of account or
450 million monetary units.
5. Where the amount of established claims against the Fund exceeds the
aggregate amount of compensation payable under paragraph 4, the amount available
shall be distributed in such a manner that the proportion between any established
claim and the amount of compensation actually recovered by the claimant under the
Liability Convention and this Convention shall be the same for all claimants.
6. The Assembly of the Fund (hereinafter referred to as "the Assembly") may,
having regard to the experience of incidents which have occurred and in particular
the amount of damage resulting therefrom and to changes in the monetary values,
decide that the amount of 30 million units of account or 450 million monetary units
referred to in paragraph 4, sub-paragraphs ( a )   and   ( b ) ,  shall be changed; provided,
however, that this amount shall in no case exceed 60 million units of account or 900
million monetary units or be lower than 30 million units of account or 450 million
monetary units. The changed amount shall apply to incidents which occur after the
date of the decision effecting the change.
7. The Fund shall, at the request of a Contracting State, use its good offices as
  14      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
necessary to assist that State to secure promptly such personnel, material and
services as are necessary to enable the State to take measures to prevent or mitigate
pollution damage arising from an incident in respect of which the Fund may be
called upon to pay compensation under this Convention.
8. The Fund may on conditions to be laid down in the Internal Regulations
provide credit facilities with a view to the taking of preventive measures against
pollution damage arising from a particular incident in respect of which the Fund may
be called upon to pay compensation under this Convention.
Article 5
1. For the purpose of fulfilling its function under Article 2, paragraph 1( b ) ,  the
Fund shall indemnify the owner and his guarantor for that portion of the aggregate
amount of liability under the Liability Convention which:
( a ) is in excess of an amount equivalent to 100 units of account or 1,500
monetary units for each ton of the ship’s tonnage or of an amount of
8,333,000 units of account or 125 million monetary units, whichever is
the less, and
( b ) is not in excess of an amount equivalent to 133 units of account or 2,000
monetary units for each ton of the said tonnage or an amount of 14
million units of account or 210 million monetary units, whichever is the
less, provided, however, that the Fund shall incur no obligation under
this paragraph where the pollution damage resulted from the wilful
misconduct of the owner himself.
2. The Assembly may decide that the Fund shall, on conditions to be laid down
in the Internal Regulations, assume the obligations of a guarantor in respect of ship
referred to in Article 3, paragraph 2, with regard to the portion of liability referred to
in paragraph 1 of this Article. However, the Fund shall assume such obligations only
if the owner so requests and if he maintains adequate insurance or other financial
security covering the owner’s liability under the Liability Convention up to an
amount equivalent to 100 units of account or 1,500 monetary units for each ton of
the ship’s tonnage or an amount of 8,333,000 units of account or 125 million
monetary units, whichever is the less. If the Fund assumes such obligations, the
owner shall in each Contracting State be considered to have complied with Article
VII of the Liability Convention in respect of the portion of his liability mentioned
above.
3. The Fund may be exonerated wholly or partially from its obligations under
paragraph 1 towards the owner and his guarantor if the Fund proves that as a result
of the actual fault or privity of the owner:
( a ) the ship from which the oil causing the pollution damage escaped did
not comply with the requirements laid down in:
(i) the International Convention for the Prevention of Pollution of the
Sea by Oil, 1954, as amended in 1962; or
(ii) the International Convention for the Safety of Life at Sea, 1960;
or 
(iii) the International Convention on Load Lines, 1966; or
(iv) the International Regulations for Preventing Collisions at Sea,
1960; or
(v) any amendments to the above-mentioned Conventions which have
OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        15
been determined as being of an important nature in accordance
with Article XVI(5) of the Convention mentioned under (i),
Article IX( e ) of the Convention mentioned under (ii) or Article
29(3)( d )   or (4)( d ) of the Convention mentioned under (iii),
provided, however, that such amendments had been in force for at
least twelve months at the time of the incident;
and 
( b ) the incident or damage was caused wholly or partially by such non-
compliance.
The provisions of this paragraph shall apply irrespective of whether the
Contracting State in which the ship was registered or whose flag it was flying is a
Party to the relevant Instrument.
4. Upon the entry into force of a new Convention designed to replace, in whole
or in part, any of the Instruments specified in paragraph 3, the Assembly may decide
at least six months in advance a date on which the new Convention will replace such
Instrument or part thereof for the purpose of paragraph 3. However, any State Party
to this Convention may declare to the Director before that date that it does not accept
such replacement; in which case the decision of the Assembly shall have no effect in
respect of a ship registered in, or flying the flag of, that State at the time of the
incident. Such a declaration may be withdrawn at any later date and shall in any
event cease to have effect when the State in question becomes a Party to such new
Convention.
5. A ship complying with the requirements in an amendment to an Instrument
specified in paragraph 3 or with requirements in a new Convention, where the
amendment or Convention is designed to replace in whole or in part such Instrument
shall be considered as complying with the requirements in the said Instrument for the
purposes of paragraph 3.
6. Where the Fund, acting as a guarantor by virtue of paragraph 2, has paid
compensation for pollution damage in accordance with the Liability Convention, it
shall have a right of recovery from the owner if and to the extent that the Fund would
have been exonerated pursuant to paragraph 3 from its obligations under paragraph 1
to indemnify the owner.
7. Expenses reasonably incurred and sacrifices reasonably made by the owner
voluntarily to prevent or minimize pollution damage shall be treated as included in
the owner’s liability for the purposes of this Article.
Article 6
1. Rights to compensation under article 4 or indemnification under Article 5
shall be extinguished unless an action is brought thereunder or a notification has
been made pursuant to Article 7, paragraph 6, within three years from the date when
the damage occurred. However, in no case shall an action be brought after six years
from the date of the incident which caused the damage.
2. Notwithstanding paragraph 1, the right of the owner or his guarantor to seek
indemnification from the Fund pursuant to Article 5, paragraph 1, shall in no case be
extinguished before the expiry of a period of six months as from the date on which
the owner or his guarantor acquired knowledge of the bringing of an action against
him under the Liability Convention.
Article 7
  16      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
1. Subject to the subsequent provisions of this Article, any action against the
Fund for compensation under Article 4 or indemnification under Article 5 of this
Convention shall be brought only before a court competent under Article IX of the
Liability Convention in respect of actions against the owner who is or who would,
but for the provisions of Article III, paragraph 2, of that Convention, have been
liable for pollution damage caused by the relevant incident.
2. Each Contracting State shall ensure that its courts possess the necessary
jurisdiction to entertain such actions against the Fund as are referred to in paragraph
1.
3. Where an action for compensation for pollution damage has been brought
before a court competent under Article IX of the Liability Convention against the
owner of a ship or his guarantor, such court shall have exclusive jurisdictional
competence over any action against the Fund for compensation or indemnification
under the provisions of Article 4 or 5 of this Convention in respect of the same
damage. However, where an action for compensation for pollution damage under the
Liability Convention has been brought before a court in a State Party to the Liability
Convention but not to this Convention, any action against the Fund under Article 4
or under Article 5, paragraph l, of this Convention shall at the option of the claimant
be brought either before a court of the State where the Fund has its headquarters or
before any court of a State Party to this Convention competent under Article IX of
the Liability Convention.
4. Each Contracting State shall ensure that the Fund shall have the right to
intervene as a party to any legal proceedings instituted in accordance with Article IX
of the Liability Convention before a competent court of that State against the owner
of a ship or his guarantor.
5. Except as otherwise provided in paragraph 6, the Fund shall not be bound by
any judgment or decision in proceedings to which it has not been a party or by any
settlement to which it is not a party. 
6. Without prejudice to the provisions of paragraph 4, where an action under
the Liability Convention for compensation for pollution damage has been brought
against an owner or his guarantor before a competent court in a Contracting State,
each party to the proceedings shall be entitled under the national law of that State to
notify the Fund of the proceedings. Where such notification has been made in
accordance with the formalities required by the law of the court seized and in such
time and in such a manner that the Fund has in fact been in a position effectively to
intervene as a party to the proceedings, any judgment rendered by the court in such
proceedings shall, after it has become final and enforceable in the State where the
judgement was given, become binding upon the Fund in the sense that the facts and
findings in that judgment may not be disputed by the Fund even if the Fund has not
actually intervened in the proceedings.
Article 8
Subject to any decision concerning the distribution referred to in Article 4,
paragraph 5, any judgement given against the Fund by a court having jurisdiction in
accordance with Article 7, paragraphs 1 and 3, shall, when it has become enforceable
in the State of Origin and is in that State no longer subject to ordinary forms of
review, be recognized and enforceable in each Contracting State on the same
conditions as are prescribed in Article X of the Liability Convention.
Article 9
OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        17
1. Subject to the provisions of Article 5, the Fund shall, in respect of any
amount of compensation for pollution damage paid by the Fund in accordance with
Article 4, paragraph 1, of this Convention, acquire by subrogation the rights that the
person so compensated may enjoy under the Liability Convention against the owner
or his guarantor.
2. Nothing in this Convention shall prejudice any right of recourse of
subrogation of the Fund against persons other than those referred to in the preceding
paragraph. In any event the right of the Fund to subrogation against such person
shall not be less favourable than that of an insurer of the person to whom
compensation or indemnification has been paid.
3. Without prejudice to any other rights of subrogation or recourse against the
Fund which may exist, a Contracting State or agency thereof which has paid
compensation for pollution damage in accordance with provisions of national law
shall acquire by subrogation the rights which the person so compensated would have
enjoyed under this Convention.
Contributions 
Article 10
1. Contributions to the Fund shall be made in respect of each Contracting State
by any person who, in the calendar year referred to in Article 11, paragraph 1, as
regards initial contributions and in Article 12, paragraphs 2 ( a )   or   ( b ), as regards
annual contributions, has received in total quantities exceeding 150,000 tons:
( a ) in the ports or terminal installations in the territory of that State
contributing oil carried by sea to such ports or terminal installations;
and
( b ) in any installations situated in the territory of that Contracting State
contributing oil which has been carried by sea and discharged in a port
or terminal installation of a non-Contracting State, provided that
contributing oil shall only be taken into account by virtue of this sub-
paragraph on first receipt in a Contracting State after its discharge in
that non-Contracting State.
2. ( a ) For the purposes of paragraph 1, where the quantity of contributing oil
received in the territory of a Contracting State by any person in a calendar year when
aggregated with the quantity of contributing oil received in the same Contracting
State in that year by any associated person or persons exceeds 150,000 tons, such
person shall pay contributions in respect of the actual quantity received by him
notwithstanding that quantity did not exceed 150,000 tons.
( b ) "Associated person" means any subsidiary or commonly controlled entity.
The question whether a person comes within this definition shall be determined by
the national law of the State concerned.
Article 11
1. In respect of each Contracting State initial contributions shall be made of an
amount which shall for each person referred to in Article 10 be calculated on the
basis of a fixed sum for each ton of contributing oil received by him during the
calendar year preceding that in which this Convention entered into force for that
State.
  18      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
2. The sum referred to in paragraph 1 shall be determined by the Assembly
within two months after the entry into force of this Convention. In performing this
function the Assembly shall, to the extent possible, fix the sum in such a way that the
total amount of initial contributions would, if contributions were to be made in
respect of 90 per cent of the quantities of contributing oil carried by sea in the world,
equal 5 million units of account or 75 million monetary units.
3. The initial contributions shall in respect of each Contracting State be paid
within three months following the date at which the Convention entered into force
for that State.
Article 12
1. With a view to assessing for each person referred to in Article 10 the amount
of annual contributions due, if any, and taking account of the necessity to maintain
sufficient liquid funds, the Assembly shall for each calendar year make an estimate
in the form of a budget of:
(i) Expenditure
( a ) costs and expenses of the administration of the Fund in the relevant year
and any deficit from operations in preceding years;
( b ) payments to be made by the Fund in the relevant year for the
satisfaction of claims against the Fund due under Article 4 or 5,
including repayment on loans previously taken by the Fund for the
satisfaction of such claims, to the extent that the aggregate amount of
such claims in respect of any one incident does not exceed 1 million
units of account or 15 million monetary units;
( c ) payments to be made by the Fund in the relevant year for the
satisfaction of claims against the Fund due under Article 4 or 5,
including repayments on loans previously taken by the Fund for the
satisfaction of such claims, to the extent that the aggregate amount of
such claims in respect of any one incident is in excess of 1 million units
of account or 15 million monetary units;
(ii) Income
( a ) surplus funds from operations in preceding years, including any
interest; 
( b ) initial contributions to be paid in the course of the year;
( c ) annual contributions, if required to balance the budget; 
( d ) any other income.
2. For each person referred to in Article 10 the amount of his annual
contribution shall be determined by the Assembly and shall be calculated in respect
of each Contracting State:
( a ) in so far as the contribution is for the satisfaction of payments referred
to in paragraph 1(i)( a ) and ( b ) on the basis of a fixed sum for each ton
of contributing oil received in the relevant State by such persons during
the preceding calendar year; and
( b ) in so far as the contribution is for the satisfaction of payments referred
to in paragraph 1(i)( c ) of this Article on the basis of a fixed sum for
each ton of contributing oil received by such person during the calendar
year preceding that in which the incident in question occurred, provided
OIL POLLUTION (LIABILITY AND COMPENSATION)    [ CAP. 351.        19
that State was a party to this Convention at the date of the incident.
3. The sums referred to in paragraph 2 above shall be arrived at by dividing the
relevant total amount of contributions required by the total amount of contributing
oil received in all Contracting States in the relevant year.
4. The Assembly shall decide the portion of the annual contribution which
shall be immediately paid in cash and decide on the date of payment. The remaining
part of each annual contribution shall be paid upon notification by the Director.
5. The Director may, in cases and in accordance with conditions to be laid
down in the Internal Regulations of the Fund, require a contributor to provide
financial security for the sums due from him.
6. Any demand for payments made under paragraph 4 shall be called rateably
from all individual contributors.
Article 13
1. The amount of any contribution due under Article 12 and which is in arrear
shall bear interest at a rate which shall be determined by the Assembly for each
calendar year provided that different rates may be fixed for different circumstances.
2. Each Contracting State shall ensure that any obligation to contribute to the
Fund arising under this Convention in respect of oil received within the territory of
that State is fulfilled and shall take any appropriate measures under its law, including
the imposing of such sanctions as it may deem necessary, with a view to the effective
execution of any such obligation; provided, however, that such measures shall only
be directed against those persons who are under an obligation to contribute to the
Fund.
3. Where a person who is liable in accordance with the provisions of Articles
10 and 11 to make contributions to the Fund does not fulfil his obligations in respect
of any such contribution or any part thereof and is in arrear for a period exceeding
three months, the Director shall take all appropriate action against such person on
behalf of the Fund with a view to the recovery of the amount due. However, where
the defaulting contributor is manifestly insolvent or the circumstances otherwise so
warrant, the Assembly may, upon recommendation of the Director, decide that no
action shall be taken or continued against the contributor.
Article 14
1. Each Contracting State may at the time when it deposits its instrument of
ratification or accession or at any time thereafter declare that it assumes itself
obligations that are incumbent under this Convention on any person who is liable to
contribute to the Fund in accordance with Article 10, paragraph 1, in respect of oil
received within the territory of that State. Such declaration shall be made in writing
and shall specify which obligations are assumed.
2. Where a declaration under paragraph 1 is made prior to the entry into force
of this Convention in accordance with Article 40, it shall be deposited with the
Secretary General of the Organization who shall after the entry into force of the
Convention communicate the declaration to the Director.
3. A declaration under paragraph 1 which is made after the entry into force of
this Convention shall be deposited with the Director.
4. A declaration made in accordance with this Article may be withdrawn by the
  20      CAP. 351. ]       OIL POLLUTION (LIABILITY AND COMPENSATION)
relevant State giving notice thereof in writing to the Director. Such notification shall
take effect three months after the Director’s receipt thereof.
5. Any State which is bound by a declaration made under this Article shall, in
any proceedings brought against it before a competent court in respect of any
obligation specified in the declaration, waive any immunity that it would otherwise
be entitled to invoke.
Article 15
1. Each Contracting State shall ensure that any person who receives
contributing oil within its territory in such quantities that he is liable to contribute to
the Fund appears on a list to be established and kept up to date by the Director in
accordance with the subsequent provisions of this Article.
2. For the purposes set out in paragraph 1, each Contracting State shall
communicate, at a time and in the manner to be prescribed in the Internal
Regulations, to the Director the name and address of any person who in respect of
that State is liable to contribute to the Fund pursuant to Article 10, as well as data on
the relevant quantities of contributing oil received by any such person during the
preceding calendar year.
3. For the purposes of ascertaining who are, at any given time, the persons
liable to contribute to the Fund in accordance with Article 10, paragraph 1, and of
establishing, where applicable, the quantities of oil to be taken into account for any
such persons when determining the amount of his contribution, the list shall be
prima   facie  evidence of the facts stated therein.
