Cape Town - Eight years after South Africa signed two international conventions that would cover the clean-up costs of a major oil spill off our coast, two bills aimed at incorporating the conventions into South African law are due to be tabled in Parliament on Wednesday.
The conventions provide for compensation of up to R3.04-billion to be paid after an incident involving an oil tanker. But without the enabling legislation South Africa cannot access the funds. Currently a shipowner can limit the compensation payable to just R210-million.
This means in the event of a major oil spill, such as the 1989 Exxon Valdez disaster in Alaska, in which 87 000 tons of crude oil were spilt, generating a clean-up bill of more than $5-billion, South African taxpayers would have to pick up the tab.
The first bill being tabled today is the Merchant Shipping (Civil Liability Convention) Bill, which limits a shipowner’s liability. If this bill is passed the maximum limit of a shipowner’s liability would rise from R210m to R3.04bn.
The second is the Merchant Shipping (International Oil Pollution Compensation Fund) Bill, which provides for access to the International Oil Pollution Convention Fund, that can be drawn on as a second tier of cover.
The conventions apply only to spills from oil tankers; bunker fuel spills from a ship such as the Kiani Satu, which ran aground near Knysna last week, are covered by different laws and conventions.
Lawyer Patrick Holloway, a member of Webber Wentzel’s insurance, shipping and transport group, who has been working on the project for years, is pleased that the two bills are “eventually” being tabled on Wednesday.
At present South Africa has no mechanism to raise the levies it must pay into the international fund in order to claim from the fund in the event of a disaster. Levies are collected from oil importers, but each country needs legislation to govern the collection.
Another two bills, known as the “money bills”, were tabled during July and the transport portfolio committee convened public hearings in respect of them on Tuesday.
“Three of these bills, the ‘money bills’ and the Fund Bill, must be promulgated before South Africa will have access to the fund convention,” said Holloway.
“The four proposed statutes would protect the taxpayer by enabling South African claimants to claim higher amounts from a shipowner in the first instance, and then, if need be, to claim against the international fund for any shortfall.”
Holloway said South African legislation also needed to be urgently updated to increase a shipowner’s liability in the case of a bunker fuel spill from a cargo ship such as the Kiani Satu.
In terms of present legislation the maximum we can claim from the owners of the Kiani Satu would be R33m, based on the size of the ship – and the ship’s cargo of rice is worth more than that. - Cape Argus