Introduction

The International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea, 2010 (2010 HNS Convention)

In Canada, over the last nine years (2001-2010) there have been at least 98 chemical spills from vessels in Canadian waters.1 Although most of these were small spills, the high volume of HNS carried by sea-going vessels, particularly in our international trade, highlights the potential for a major chemical spill occurring in Canadian waters.

In the 1990's, several incidents involving water-borne spills of HNS highlighted a gap in the marine liability system and prompted the international community to take action. Through the International Maritime Organization (IMO), a liability regime was devised to compensate claimants in the event of spills involving chemicals and other hazardous substances. This effort culminated in the HNS Convention, which was adopted under the auspices of the IMO in 1996.

Canada signed the Convention in 1997 following widespread consultations with industry stakeholders, which resulted in the development of the Maritime Law Reform Discussion Paper. It was released in 2005 and recommended the ratification and implementation of the HNS Convention. This sent a signal to stakeholders and the international community that Canada intends to give favourable consideration to the Convention's ratification and to the legislation required to implement the regime in national law. The Maritime Law Reform Discussion Paper also allowed for initial consultations with stakeholders. Following the release of the paper, Canada was part of discussions among states at the international level, which focused on finding solutions to issues raised within the existing 1996 HNS Convention. However, in 2007 it was agreed that a Protocol was needed to deal with obstacles to the implementation of the Convention by states.

The Protocol is intended to address the underlying causes that have inhibited the entry into force of the HNS Convention, i.e.:

1) Contributions to the Liquefied Natural Gas (LNG) Account and the fact that titleholders to LNG cargoes in non-state parties would not contribute to cover compensation from LNG incidents. This would of lead to situations where those with certain types of LNG supply contracts would not have contributed to the HNS Fund if they were located outside of the jurisdiction of an HNS Convention state party;

2) The concept of 'receiver' and the difficulties in effectively implementing a reporting and contributions system for packaged HNS. The complex logistics chain for packaged HNS and uncertainty over who would be considered the actual "receiver" meant that states would of needed to put in place very burdensome reporting and tracking requirements for packaged HNS; and

3) Non-submission of contributing cargo reports by states, on ratification of the Convention and annually thereafter. The 1996 HNS Convention did not impose any sanctions against states that did not report the HNS received in their territory and this presented an unfair sharing of the burden among states when assessing contributions to the HNS Fund.

As it currently stands, the original HNS Convention of 1996 was signed, subject to ratification, by eight states2 and was ratified by 14 states3 but never came into force internationally as one of the entry into force provisions was never met. The particular entry into force provision that was never met by those states that ratified the Convention is the requirement to submit reports on its contributing cargo to the future HNS Fund (i.e. how much HNS received in that state over the thresholds established in the Convention).

The 2010 Protocol to the HNS Convention, was developed, first by a Working Group set up by the International Oil Pollution Compensation (IOPC) Fund's 1992 Fund Assembly, and then by the IMO's Legal Committee with the aim of facilitating the entry into force of the HNS Convention.

The Protocol, which addressed these practical problems that have prevented many states from ratifying the original Convention, was adopted by the IMO at a diplomatic conference held on April 26-30, 2010. That conference also adopted four resolutions relating to the setting up of the HNS Fund, the promotion of technical co-operation and assistance, avoidance of a situation in which two conflicting treaty regimes are operational, and the implementation of the 2010 HNS Protocol.

This section sets out an overview of the instrument's main provisions, Canadian legislation in this regard, the policy questions to be addressed if Canada were to ratify the Convention, and a recommended way forward.



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1 Canadian Coast Guard Marine Pollution Incident Reporting System (CCG MPIRS).
2 Canada, Denmark, Finland, Germany, Netherlands, Norway, Sweden, and the United Kingdom
3 Russian Federation, Liberia, Angola, Tonga, Slovenia, Samoa, St. Kitts and Nevis, Morocco, Cyprus, Syrian Arab Republic, Sierra Leone, Lithuania, Hungary, and Ethiopia.
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