The Practice of Oil Pollution Liability: A Comparative Study of India And USA

Abstract

Oil pollution may result in loss of life, personal injury and other impairments of health, loss or damage to property, and short term or long term damage to the marine environment. Major issues include fixing liability for damage caused, and ascertaining the proportionate level of compensation for the same. The legal regime addressing the issues of oil pollution liability and compensation are primarily governed by the Merchant Shipping Act, 1958 (MSA) and its Amendment Acts of 2002 and 2003 in India, and the Oil Pollution 'Act, 1990 (OPA) in United States of America (USA). The MSA and OPA are founded on the principle of strict liability for ship owners and create a system of compulsory liability insurance. Claims for compensation for oil pollution damage maj be brought against the owner of the tanker, which caused the damage, or directly against the owner's P&I insurer. This paper gives an overview of the Indian and American legal framework for oil pollution liability and provides an insight in to the potential strengths and weaknesses of the same. The central argument made through the paper is that despite the straightforward claims procedure under the Indian law, claimants are less likely to obtain adequate compensation in the event of a catastrophic oil spill, in comparison to the OPA which guarantees that there are adequate funds available to provide sufficient compensation for successful claimants.