Government of Jersey

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A decision made (30/05/2008) regarding: Extension of Protocol - Limitation of Liability for Maritime Claims (LLMC).

Decision Reference: MD-E-2008-0073
Decision Summary Title :	Extension of Protocol - Limitation of Liability for Maritime Claims (LLMC)		Date of Decision Summary:	27 May 2008
Decision Summary Author:	Dr J Lane, Director, Regulatory Services		Decision Summary: Public or Exempt? (State clauses from Code of Practice booklet)	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title :	Extension of the 1996 Protocol to the Convention on Limitation of Liability for Maritime Claims (LLMC) 1976		Date of Written Report:	10 April 2008
Written Report Author:	Dr J Lane, Director, Regulatory Services		Written Report : Public or Exempt? (State clauses from Code of Practice booklet)	Public
Subject: Extension of the 1996 Protocol to the Convention on Limitation of Liability for Maritime Claims (LLMC).
Decision(s): The Minister approved the report and proposition entitled, ‘Draft Shipping (Amendment No. 2) (Jersey) Law 200-‘ and agreed that it should be lodged au Greffe as soon as possible.
Reason(s) for Decision: The United Kingdom has previously ratified the Convention on behalf of the Island and the Insular Authorities have requested the UK to extend the Protocol to Jersey. Amendments to the Shipping (Jersey) Law 2002 are necessary to give effect to the Protocol locally, without which the limitation of liability will remain artificially low within Jersey’s jurisdiction. The United Kingdom has also specifically recommended that all Crown Dependencies and Overseas Territories now progress this. For their part, the UK can only request extension of the Protocol and the denouncing of the original Convention once the States have passed the amendments.
Resource Implications: There are no new financial, property, ICT or human resources issues arising.
Action required: Following the Ministerial Decision, the draft Law amendment will be lodged au Greffe for debate as soon as possible.
Signature: Senator P.F.C.Ozouf		Position: Minister
Date Signed:		Date of Decision (If different from Date Signed):

Extension of Protocol - Limitation of Liability for Maritime Claims (LLMC).

PROPOSITION

THE STATES are asked to decide whether they are of opinion -

(a) to approve the draft Shipping (Amendment No. 2) (Jersey) Law 200-;

(b) to agree that on the passing of the Law, the Government of the United Kingdom should be requested to extend the 1996 Protocol to the Convention on Limitation of Liability for Maritime Claims 1976 to the Island and simultaneously denounce the Convention.

Extension of the 1996 Protocol to the Convention on Limitation of Liability for Maritime Claims (LLMC) 1976

Background

The aim of the Convention on Limitation of Liability for Maritime Claims (LLMC) and that of its associated Protocol is to provide a manageable liability regime for maritime claims. Limitation is necessary for a variety of reasons not least to prevent the liability and consequential insurance being prohibitive.

Limitation is achieved on an agreed international sliding scale that relates to the size of the ship. Large ships carrying more passengers or greater quantities of cargo carry higher liability than small ships.

The Convention came into force in Jersey in 1976. The Protocol to that Convention was agreed internationally in 1996 and raises the limits of liability. It came into force in the United Kingdom in 2004. It is not in force in Jersey.

Partial provision was made for the 1996 Protocol in the Shipping (Jersey) Law 2002 and the Insular Authorities wrote in November 2003 requesting the United Kingdom to extend it to Jersey. The intention was for the Protocol to be in place in Jersey on the coming into force of the Shipping Law, on 1 June 2004 but this did not happen.

The Purpose of the Protocol

Primarily the Protocol will have the effect of raising the limitation of liability to more appropriate levels. The passage of time inevitably has reduced the real monetary value of the original limits.

In terms of vessels visiting Jersey and considering a claim for serious injury or loss of life, liability based on the old rates is currently limited to approximately £780,000 for a small cargo vessel of 3,000 tons in size, rising to £2.1m for a large roll-on/roll-off freighter of 11,000 tons.

For the same vessels, the new rates will be in a range of £1.38m up to £4.5m 1 .

Legal Changes

There are procedural issues in the Shipping (Jersey) Law 2002 concerning both this Convention and the Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea 1996. As the Law stands, the States can only bring in relevant Regulations once these Conventions, or revisions to them, have been agreed to on behalf of Jersey by the UK Government. The Economic Development Department has received advice that this will not work and that the correct way round is for the Regulations or other implementing legislation to be in place first. The Island can then request the UK to agree the relevant international instrument on our behalf.

In order for the Protocol to be effective, the Shipping (Jersey) Law 2002, as the implementing legislation, needs amending. It must specify the new limits and other aspects of the Protocol which improve and clarify the purposes of the original Convention.

Once this is done, the United Kingdom’s Ministry of Justice will be requested to extend the Protocol to the Island and simultaneously denounce the Convention. We are advised by the UK that this is necessary to avoid a potential conflict between the old and new systems for setting the limits and determining which limits should apply.

Details of Articles

Articles 2 and 3

Articles 117 and 119 are amended so as to ensure Regulations can be made as soon as the UK has ratified the relevant instrument for itself. This avoids the problem that Jersey might face if it asked the UK to ratify on behalf of the Island before it had the right implementing legislation in place first.

Article 4

Article 4(1) (a) to (d) amend schedule 6 of the primary Law so that the new financial limits established by the Protocol replace the old 1976 limits. These are set as a number of Units of Accounts depending on the tonnage of the ship concerned. At the time of writing one Unit of Account (being defined as the same as a Special Drawing Right), equates to one US dollar.

Article 4(1)(e) amends article 15 of the Convention. It introduces some flexibility for participating States regarding inland waterways and vessels of less than 300 tons.

Article 4(1)(f) inserts the new chapter on reservations that was agreed in the Protocol.

Finally, article 4(2) makes some small but important law drafting corrections that were identified both in the Jersey and UK legislation.

Resources Implications

There are no financial, manpower, property, ICT or other implications for the States of Jersey.

European Convention on Human Rights

Article 16 of the Human Rights (Jersey) Law 2000 requires the Minister in charge of a Projet de Loi to make a statement about the compatibility of the provisions of the Projet with the Convention rights (as defined by Article 1 of the Law).

In the view of the Minister for Economic Development the provisions of the Draft Shipping (Amendment No. 2) (Jersey) Law 200- are compatible with the Convention Rights.

10 April 08

1 These rates vary, as they are based on Special Drawing Rights (SDR) where 1SDR = 1$. As the dollar value has fallen, so has the actual liability in sterling.