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Outline
·
Under STOPIA, the
limits of liability under CLC 92 for tankers up to 29,548 gross tons will
be increased voluntarily to SDR 20 million for spills affecting States
ratifying the Supplementary Fund Protocol.
·
The increased limits
will take effect from 3rd March 2005 and will be implemented by
indemnifying the IOPC Fund for liability in excess of CLC 92 limits, up to
SDR 20 million.
·
The Association
provides cover for the increased liability under Rule 2, Section 12.
·
A guide to STOPIA is
attached as Annex 1.
·
A related agreement
between the Group Clubs and the IOPC Fund is attached as Annex 2.
·
A recommended
charterparty clause for warranting owners' participation in STOPIA is
attached as Annex 3.
TO THE MEMBERS
Dear Sirs
Small Tanker Oil Pollution
Indemnification Agreement (STOPIA)
On 3rd March 2005, the Supplementary Fund Protocol of 2003 will come into
force in Denmark, Finland, France, Germany, Ireland, Japan, Norway and
Spain. A number of other States are expected to ratify the Protocol
shortly.
The Protocol provides an additional layer of compensation in respect of oil
pollution damage to which the 1992 Civil Liability Convention (CLC 92)
and/or 1992 Fund Convention (1992 Fund) apply. The maximum amount of
compensation available in States where the Protocol is in force will be SDR
750 million (approximately US $1.15 billion). This figure is inclusive of
the compensation payable under the 1992 Fund (up to SDR 203 million) which
is, in turn, inclusive of any compensation payable under CLC 92 (between
SDR 4.51 million and SDR 89.77 million depending upon vessel tonnage).
In 2001, at the time when the Supplementary Fund Protocol was being drawn
up, the Boards of all International Group Clubs agreed to put in place a
mechanism for increasing the minimum limit of shipowner liability under CLC
92 in order to:-
·
Demonstrate the
support of shipowners for the compensation scheme established by CLC
92/1992 Fund.
·
Demonstrate the
commitment of shipowners to the notion of sharing and in recognition of the
potential increased burden for contributing oil receivers under the
proposal to introduce a third tier of compensation through the
Supplementary Fund Protocol.
·
Avoid the necessity
to amend the Conventions.
Following the adoption of the draft Protocol at the IMO two agreements were
drawn up in order to implement the scheme approved by Club boards.
The first agreement, known as Small Tanker Oil Pollution Indemnification
Agreement (STOPIA) has the effect of substituting the limit of liability
under CLC 92 of SDR 4.51 million (approximately US$ 6.7 million) for a
tanker not exceeding 5,000gt with a limit of SDR 20 million (approximately
US$ 30 million) for a tanker not exceeding 29,548gt.
STOPIA is an agreement between the owners of tankers of 29,548 gt or less
to indemnify the 1992 Fund in respect of the Fund's liability for the
difference between the shipowner's limit of liability under CLC 92 and SDR
20 million. The indemnity will only apply in the event of tanker spills
affecting a State in which the Supplementary Fund Protocol is in force and
when liability is imposed on the ship owner under CLC 92. Neither the flag
of the vessel nor the ownership of the cargo is relevant. Provided that the
amount of compensation payable exceeds the shipowner's limit under CLC 92,
the scheme will operate even if there is no claim upon the Supplementary
Fund. Because the indemnity is payable to the 1992 Fund, all contributors
to the 1992 Fund will benefit when STOPIA applies. The scheme is based upon
the liability and compensation system established by the 1992 Conventions
and shipowners and their Clubs reserve the right to withdraw the scheme if
and when any material change to the provisions regarding tanker owners'
liability is made. Although the 1992 Fund is not a party to STOPIA, legally
enforceable rights of indemnification are created for the benefit of the
1992 Fund.
The second agreement (currently awaiting the approval of the 1992 Fund
Assembly) takes the form of additional provisions to be inserted into the
Memorandum of Understanding (MOU) which has been in existence between the
1992 Fund and the International Group of P&I Clubs for many years.
Under these new provisions, the Clubs undertake to provide cover against
the liabilities incurred by their Members to indemnify the 1992 Fund in
accordance with STOPIA and to give the 1992 Fund the right of Direct Action
against the insuring Club in respect of those liabilities. The Clubs also
undertake to provide for automatic entry of relevant vessels in STOPIA as a
condition of pollution cover and to advise the Fund of the names of all
such vessels.
Therefore with effect from 3rd March 2005, Section 12 of Rule 2 of the
Association's Rules will have the effect of entering in the STOPIA scheme
Members who are owners of tankers of 29,548 gt or less which may carry
persistent oil in bulk as cargo. A Member's liability to indemnify the 1992
Fund under STOPIA will be insured by the Club in accordance with the Rules
and the Member's terms of entry.
A copy of STOPIA, plus a more detailed explanatory note is attached to this
circular as Annex 1. A copy of the MOU amendment is attached to this
circular as Annex 2.
Charterparty Clause
It is likely that charterers will require relevant tanker owners to warrant
their participation in STOPIA under the terms of charterparties. A
recommended clause for inserting into charterparties is attached as Annex
3.
Yours faithfully
THOMAS MILLER (BERMUDA) LTD.
ANNEX 1
EXPLANATORY NOTE AND TEXT OF STOPIA
AGREEMENT
This Note explains the purpose behind the Small Tanker Oil Pollution
Indemnification Agreement (STOPIA) and gives a short summary of its main
features. It does not form part of the Agreement but is intended to serve as
an informal guide for those interested in understanding how it is intended
to operate.
The Agreement establishes the STOPIA Scheme, the object of which is to
provide a mechanism for shipowners to pay an increased contribution to the
funding of the international system of compensation for oil pollution from
ships, as established by the 1992 Civil Liability Convention, the 1992 Fund
Convention and the 2003 Supplementary Fund Protocol. The Scheme reflects
the desire of shipowners to support efforts to ensure the continuing
success of this international system. It is also intended to encourage
widest possible ratification of the Protocol, and has been drawn up in
recognition of the potential additional burden imposed by the Protocol on
receivers of oil.
STOPIA is designed to compensate for this additional burden by adjusting
the financial effect of the limitation of liability provisions in CLC 92 in
respect of incidents causing pollution damage in States where the
Supplementary Fund Protocol is in force. The Scheme reflects the fact that
CLC 92 provides for the liability limit of the shipowner to be calculated
by reference to the tonnage of the ship, subject to a minimum limit of SDR
4.51 million for ships of 5,000 gross tons or less. Given that the 1992 Fund
pays compensation where claims exceed the CLC 92 limit, incidents involving
small tankers may result in the 1992 Fund bearing a relatively high
proportion of the compensation payable, and paying compensation in a larger
number of incidents than would be the case if the minimum limit under CLC
92 were higher. Against this background the Scheme provides for shipowners
to bear the cost of oil spills up to a minimum level of SDR 20 million.
That amount is equivalent to the liability limit under CLC 92 for a ship of
29,548 gross tons. STOPIA therefore re-apportions the ultimate cost of oil
spills involving ships up to that size.
The Scheme is established by a legally binding Agreement between the owners
of ships in this category which are insured against oil pollution risks by
P&I Clubs in the International Group. In all but a relatively small
number of cases, ships of this description will automatically be entered in
the Scheme as a condition of Club cover. Their owners will be parties to
the Agreement and are referred to as "Participating Owners".
As the Scheme is contractual it does not affect the legal position under
the 1992 Conventions, and the victims of oil spills continue to enjoy their
existing rights against the 1992 Fund. For this reason the Scheme provides
for the owner of the ship involved in an incident to pay Indemnification to
the 1992 Fund, rather than to pay extra sums directly to claimants.
Although the 1992 Fund is not a party to STOPIA the Agreement is intended
to confer legally enforceable rights on the 1992 Fund, and it expressly
provides that the 1992 Fund may bring proceedings in its own name in
respect of any claim under the Scheme. The Scheme is governed by English
law, and English legislation enables legally enforceable rights to be
conferred in this manner.
Insurers are not parties to the Agreement, but all Clubs in the
International Group have amended (or agreed to amend) their Rules to
provide shipowners with cover against liability to pay Indemnification
under STOPIA. The Clubs are also authorised under the Scheme to enter into
ancillary arrangements enabling the 1992 Fund to enjoy a right of direct
action against the relevant Club in respect of any claim under the Scheme.
It is envisaged that these and other terms supporting the operation of the
Scheme will be incorporated in a revised version of the current Memorandum
of Understanding between the 1992 Fund and the International Group of
P&I Clubs.
Whilst the above are the main features of the Scheme, its eleven clauses
address numerous matters of detail. Clause I sets out various definitions,
most of which are intended to dovetail with the terminology and provisions
of the relevant international conventions. Clauses II and III contain
general provisions relating to the Scheme and provide for it to apply to
"Relevant Ships". Apart from a relatively small category of ships
mentioned below, all tankers will be Relevant Ships if they are of 29,548
tons or less and are insured by an International Group Club. The Scheme
provides that the owner of any such ship shall become a party to the
Agreement when made a party by his Club in accordance with its Rules, and
normally this will result in him automatically becoming a party as a
condition of cover against oil pollution risks. The Agreement also provides
for any Relevant Ship which he owns to be entered automatically in the
Scheme.
An exception to these arrangements relates to ships which are insured by an
International Group Club but are not reinsured through the Group's Pooling
arrangements. A ship in this category is not automatically entered in the
Scheme, but may nonetheless be deemed to be a Relevant Ship (and be entered
in the Scheme) by written agreement between the owner and his Club. Certain
Japanese coastal tankers are insured outside the International Group
Pooling arrangements, but it appears that fewer than 200 of these exceed
200 gross tons. By contrast, some 6,000 tankers are expected to be entered
in STOPIA.
Clause IV sets out the precise circumstances in which the Participating
Owner of a Relevant Ship is liable to pay Indemnification to the 1992 Fund,
and it includes detailed provisions affecting the calculation of the
precise amount payable.
Clause V deals with recourse against third parties, and provides for Indemnification
of the 1992 Fund to be postponed until a final conclusion has been reached
in any recourse action it decides to bring against other potentially
responsible parties. Credit is to be given for any sums recovered, but the
1992 Fund retains an absolute discretion as to the commencement, conduct
and any settlement of such proceedings. In the event of Indemnification
being paid before recourse proceedings have been completed, provision is
made for it to be treated as an interest-free loan until the proceedings
are over. (This is to avoid the recourse claim being prejudiced as a result
of the defendant being able to argue that Indemnification has reduced the
loss for which the 1992 Fund may claim recovery.)
Clause VI contains time bar provisions designed to dovetail with the 1992
Conventions (and to allow the 1992 Fund a further 12 months in which to
claim Indemnification after the time limit for claims against it under the
1992 Fund Convention).
Clause VII deals with amendment of the Scheme and enables changes to be
made by the International Group acting as agent for all Participating
Owners. No amendment is to have retrospective effect, and the Clubs have
agreed that new arrangements in a revised Memorandum of Understanding
should provide for consultation with the 1992 Fund in good time prior to
any decision to amend the Scheme.
Clause VIII provides for the Scheme to enter into effect simultaneously
with the entry into force of the Supplementary Fund Protocol. Provision is
also made for termination of the Agreement in certain circumstances,
notably in the event of developments which materially and significantly
change the system of compensation established by the current international
regime. Again, the Clubs have agreed to consult with the 1992 Fund prior to
any decision to terminate STOPIA.
Under Clause IX a Participating Owner may withdraw from the Scheme, and the
terms on which he may do so are set out. However it is anticipated that the
owner of a Relevant Ship will not normally be able to withdraw from STOPIA
without prejudicing his Club cover in respect of oil pollution risks.
Clause X sets out the legal rights under the Scheme of the 1992 Fund, and
the authority of the International Group to agree ancillary arrangements
with the 1992 Fund in respect of direct actions. The Clubs have agreed to
bear direct liability on a similar basis to that prescribed by CLC 92.
Finally the Agreement provides by Clause XI that it is to be governed by
English law and that the English High Court of Justice shall have exclusive
jurisdiction in relation to any disputes thereunder.
SMALL TANKER OIL POLLUTION
INDEMNIFICATION AGREEMENT (STOPIA)
INTRODUCTION
The Parties to this Agreement are the Participating Owners as defined
herein.
The Participating Owners recognize the success of the international system
of compensation for oil pollution from ships established by the 1992 Civil
Liability and Fund Conventions, and they are aware that it may need to be
revised or supplemented from time to time in order to ensure that it
continues to meet the needs of society.
A Protocol has been drawn up and adopted to supplement the 1992 Fund
Convention by providing for additional compensation to be available from a
Supplementary Fund in States which opt to accede to the Protocol. The
Parties wish to encourage the widest possible ratification of the Protocol,
with a view to facilitating the continuance of the existing compensation
system in its current form (but as supplemented by the Protocol).
In consideration of the potential additional burden imposed by the Protocol
on receivers of oil, the Participating Owners have agreed to establish the
scheme set out herein, whereby the Participating Owners of tankers below a
specified tonnage will indemnify the International Oil Pollution
Compensation Fund 1992 ("the 1992 Fund") for a portion of its
liability to pay compensation under the 1992 Fund Convention for pollution
damage caused by such tankers in States in respect of which the Protocol
establishing the Supplementary Fund is in force.
This Agreement is intended to create legal relations and in consideration
of their mutual promises Participating Owners of each Entered Ship have
agreed with one another and do agree as follows -
I. DEFINITIONS
A. The following terms shall have the same meaning as in
Article I of the Liability Convention:
"Incident", "Oil", "Owner",
"Person", "Pollution Damage", "Preventive
Measures", "Ship".
B. "1992 Fund" means the International Oil Pollution
Compensation Fund 1992 as established by the 1992 Fund Convention.
C. "1992 Fund Convention" means the International
Convention on the Establishment of an International Fund for Compensation
for Oil Pollution Damage, 1992, as amended and/or supplemented from time to
time, and any domestic legislation giving effect thereto.
D. "Club" means a Protection and Indemnity (P&I)
Association in the International Group; "the Owner's Club" means
the Club by which a Relevant Ship owned by him is insured, or to which he
is applying for Insurance; "his Club", "Club Party" and
similar expressions shall be construed accordingly.
E. "Entered Ship" means a Ship to which the Scheme
applies, and "Entry" shall be construed accordingly.
F. "Indemnification" means the indemnity payable
under Clause IV of this Agreement.
G. "Insurance", "insured" and related
expressions refer to protection and indemnity cover against oil pollution
risks.
H. "International Group" means the International
Group of P&I Clubs.
I. "Liability Convention" means the International
Convention on Civil Liability for Oil Pollution Damage, 1992, as amended
from time to time, and any domestic legislation giving effect thereto.
J. "Participating Owner" means the Owner of an
Entered Ship who is a Party.
K. "Party" means a party to this Agreement.
L. "Protocol" means the Protocol of 2003 to
Supplement the 1992 Fund Convention, and any domestic legislation giving
effect thereto; and "Protocol State" means a State in respect of
which the said Protocol is in force.
M. "Relevant Ship" has the meaning set out in Clause
III(B).
N. "Scheme" means the Small Tanker Oil Pollution
Indemnification Agreement (STOPIA) as established by this Agreement.
O. "Supplementary Fund" means the Fund established by
the Protocol.
P. "Tons" means the gross tonnage calculated in
accordance with the tonnage measurement regulations contained in Annex I of
the International Convention on Tonnage Measurement of Ships, 1969; the
word "tonnage" shall be construed accordingly.
Q. "Unit of account" shall have the same meaning as
that set out in Article V, paragraph 9 of the Liability Convention.
II. GENERAL
A. This Agreement shall be known as the Small Tanker Oil
Pollution Indemnification Agreement (STOPIA).
B. The Owner of any Relevant Ship shall be eligible to become a
Party and shall do so when made a Party by the Club insuring that Ship as
the Rules of that Club may provide.
III. THE STOPIA SCHEME
A. This Agreement is made to establish STOPIA for payment of
Indemnification to the 1992 Fund on the terms set out herein.
B. A Ship shall be eligible for Entry in the scheme if:
1. it is of not more than 29,548 Tons;
2. it is insured by a Club; and
3. it is reinsured through the Pooling arrangements of the
International Group.
Such a ship is
referred to herein as a "Relevant Ship".
C. Any Relevant Ship owned by a Participating Owner shall automatically
be entered in the Scheme upon his becoming a Party to this Agreement in
accordance with Clause II(B) above.
D. A Ship which is not a Relevant Ship by reason of the fact
that it is reinsured independently of the said Pooling arrangements may
nonetheless be deemed to be a Relevant Ship by written agreement between
the Owner and his Club.
E. Once a Relevant Ship has been entered in the Scheme it shall
remain so entered until
1. it ceases to be a Relevant Ship (as a result of tonnage
re-measurement and/or of ceasing to be insured and reinsured as stated in
Paragraph (B) above); or
2. it ceases to be owned by a Participating Owner; or
3. the Participating Owner has withdrawn from this Agreement in
accordance with Clause IX.
IV. INDEMNIFICATION OF 1992 FUND
A. Where as a result of an Incident an Entered Ship causes
Pollution Damage in a Protocol State in respect of which liability is
incurred both under the Liability Convention by the Participating Owner of
that Ship and under the 1992 Fund Convention by the 1992 Fund, the said
Owner shall indemnify the 1992 Fund up to an amount calculated in
accordance with Paragraph (E) below.
B. Pollution Damage in a Protocol State means:
1. Pollution Damage caused:
i.
in the territory,
including the territorial sea, of a Protocol State; and/or
ii.
in the exclusive
economic zone of a Protocol State, established in accordance with
international law, or, if such a State has not established such a zone, in
an area beyond and adjacent to the territorial sea of that State determined
by that State in accordance with international law and extending not more
than 200 nautical miles from the baselines from which the breadth of its
territorial sea is measured; and/or
2. the costs of Preventive Measures, wherever taken, to prevent
or minimize such Pollution Damage.
C. Indemnification shall not be payable for:
1. the costs of any Preventive Measures to the extent that the
Participating Owner is exonerated from liability under Article III,
paragraph 3 of the Liability Convention, and for which the 1992 Fund is
liable by virtue of Article 4, paragraph 3 of the 1992 Fund Convention;
2. any other Pollution Damage to the extent that liability is
incurred by the 1992 Fund but not by the Participating Owner.
D. Indemnification due under this Agreement shall be payable irrespective
of whether any payments are made from the Supplementary Fund in respect of
the Incident.
E. The amount for which Indemnification is payable by the
Participating Owner shall be the aggregate amount of compensation paid by
the 1992 Fund for Pollution Damage in a Protocol State, provided always
that –
1. for the purpose of this Clause IV(E) the aggregate amount of
compensation paid by the 1992 Fund shall be the total amount of
compensation paid by the 1992 Fund less any sums recovered by the 1992 Fund
in recourse action pursuant to Clause V below (net of the costs of such
recourse action);
2. the Indemnification amount shall not exceed in respect of
any one Incident an amount equivalent to 20 million units of account less –
i.
the amount of the
Owner's liability under the Liability Convention as limited by Article V,
paragraph 1 thereof; and
ii.
any amounts which he
or his Club is entitled to recover from the 1992 Fund in respect of the
Incident, whether in their own right, by subrogation, assignment or
otherwise.
F. The deduction referred to in Paragraph (E)(2)(i) above shall
be made irrespective of whether the Participating Owner is entitled to
avail himself of limitation.
G. For the purposes of this Agreement the conversion of units
of account into national currency shall be made in accordance with Article
V, paragraph 9 of the Liability Convention.
V. RECOURSE AGAINST THIRD PARTIES
A. Any decisions as to whether the 1992 Fund is to take
recourse action against any third parties, and as to the conduct of any
such action, including any out-of-court settlement, are in the absolute
discretion of the 1992 Fund.
B. Unless otherwise agreed, payment of Indemnification to the
1992 Fund shall be postponed until such time as the 1992 Fund gives notice
to the Participating Owner that a final conclusion has been reached in
relation to all and any recourse action taken or contemplated by the 1992
Fund against any third parties in respect of the Incident. For these
purposes a final conclusion may include a decision by the 1992 Fund not to
take such action, or to discontinue any such action already commenced.
C. Paragraph (B) above shall not prevent the 1992 Fund from
commencing proceedings against the Participating Owner and the Club in
order to protect its rights hereunder from becoming time-barred.
The Participating
Owner and his Club agree to grant to the 1992 Fund any extension of time
which the 1992 Fund may reasonably require in respect of the commencement
or conduct of such proceedings in circumstances where recourse action is ongoing
and/or no notice of final conclusion has been given in accordance with
Paragraph (B) above.
D. Without prejudice to Paragraph (A) above, the 1992 Fund may
consult with the Participating Owner and/or his Club in relation to any
recourse action in which they are actual or potential claimants. Nothing in
this Agreement shall prevent the 1992 Fund, the Owner and the Club from
agreeing on any arrangements relating to such action as may be considered
appropriate in the particular case, including any terms as to the
apportionment of the costs of funding such action, or as to the allocation
of any recoveries made.
E. If the 1992 Fund decides not to take recourse action against
any third party or, after such action has been taken, decides not to pursue
the action, Indemnification is payable on condition that the 1992 Fund will
execute such reasonable documentation as may be required to transfer to the
Participating Owner and/or his Club, by subrogation, assignment or
otherwise, any rights of recourse which it may have against third parties,
to the extent of any interest which they may have in recoveries from such
parties by virtue of Indemnification paid under this Agreement.
F. In the event of the Participating Owner agreeing to pay
Indemnification before the 1992 Fund has given notice as mentioned in
Paragraph (B) above, such payment shall (unless otherwise agreed) be
subject to the condition that it is to be treated as an interest-free loan
repayable on demand until such notice is given, whereupon it shall cease to
be repayable.
G. Indemnification is also paid on the condition that if, after
it has been paid, the 1992 Fund for any reason recovers any sums from any
third party, the 1992 Fund will account to the Participating Owner for such
recoveries (net of any costs incurred by the 1992 Fund in making them), so
as to reimburse the Participating Owner any Indemnification paid by him in
excess of the amount which would have been payable in accordance with
Clause IV(E) above.
H. Save where the 1992 Fund has been notified to the contrary,
the Club insuring the Participating Owner shall be deemed to be authorised
to act on his behalf in receiving notice from the 1992 Fund under Paragraph
(B) above; in granting any time extension or extensions under Paragraph (C)
above; in receiving any reimbursement pursuant to Paragraph (G) above; and
in agreeing all and any other matters relating to the operation of this
Clause V.
VI. PROCEDURE AND MISCELLANEOUS
Any rights of the 1992 Fund to Indemnification under this Agreement shall be
extinguished unless an action is brought hereunder within four years from
the date when the Pollution Damage occurred. However, in no case shall an
action be brought after seven years from the date of the Incident which
caused the damage. Where this Incident consists of a series of occurrences,
the seven years' period shall run from the date of the first such
occurrence.
VII. AMENDMENT
A. This Agreement may be amended at any time by the
International Group acting as agent for all Participating Owners.
Any such amendment
to this Agreement will take effect three months from the date on which
written notice is given by the International Group to the 1992 Fund.
B. Each Participating Owner agrees that the International Group
shall be authorized to agree on his behalf to an amendment of this
Agreement if -
1. it is so authorized by his Club, and
2. his Club has approved of the amendment by the same procedure
as that required for alteration of its Rules.
C. Any amendment to the Agreement shall not affect rights and
obligations in respect of any incident which occurred prior to the date
when such amendment enters into force.
VIII. DURATION
A. This Agreement shall enter into effect simultaneously with
the entry-into-force of the Protocol.
B. Subject to the following provisions of this Clause VIII,
this Agreement may be terminated at any time by the International Group
acting on behalf of all Participating Owners.
C. Each Participating Owner agrees that the International Group
shall be authorized to terminate this Agreement on his behalf if
1. the Clubs cease to provide Insurance against the liability
of Participating Owners to pay Indemnification under this Agreement; or
2. any international instrument is adopted or agreement is
reached, or any relevant domestic or regional law is made or adopted
(including any binding judicial decision or precedent), which does or will
materially and significantly change the system of compensation established
by the Liability Convention, the 1992 Fund Convention and the Protocol,
and/or the operation of that system in any one or more Protocol States
(hereinafter referred to as a "material change"); or
3. termination is authorized by his Club, and his Club has
approved of the termination by the same procedure as that required for
alteration of its Rules.
D. Termination shall not take effect until three months after
the date on which the 1992 Fund is notified thereof in writing by the
International Group. In the event of termination on the grounds stated in
Paragraph (C)(2) above, such notice may specify that termination is take
effect -
1. at such later date, if any, on which the material change
takes effect; and/or
2. either entirely, or in relation only to Pollution Damage in
any State or States specified in the notice as being affected by such
change.
E. The termination of this Agreement shall not affect rights or
obligations in respect of any Incident which occurs prior to the date of
termination.
IX. WITHDRAWAL
A. A Participating Owner may withdraw from this Agreement –
1. on giving not less than 3 months' written notice of
withdrawal to his Club; or
2. by virtue of an amendment thereto, provided always –
i.
that he exercised any
right to vote against the said amendment when his Club sought the approval
thereto of its members; and
ii.
that within 60 days
of the amendment being approved by the membership of his Club he gives
written notice of withdrawal to his Club; and
iii.
that such withdrawal
shall take effect simultaneously with the entry-into-effect of the
amendment, or on the date on which his notice is received by his Club,
whichever is later.
B. If a Participating Owner ceases to be the owner of a
Relevant Ship he shall be deemed, in respect of that ship only, to withdraw
from this Agreement with immediate effect and shall give written notice to
the 1992 Fund that he has ceased to be the owner of that Relevant Ship.
C. A Participating Owner withdrawing from this Agreement shall
have no further liability hereunder as from the date when his withdrawal
takes effect; provided always that no withdrawal shall affect rights or obligations
in respect of any Incident which occurs prior to that date.
X. LEGAL RIGHTS OF 1992 FUND
A. Though not a Party to this Agreement, the 1992 Fund is
intended to enjoy legally enforceable rights of Indemnification as
described herein, and accordingly the 1992 Fund shall be entitled to bring
proceedings in its own name against the Participating Owner in respect of
any claim it may have hereunder.
B. Notwithstanding Paragraph (A) above, the consent of the 1992
Fund shall not be required to any amendment, termination or withdrawal made
in accordance with the terms of this Agreement.
C. The Parties to this Agreement authorize the International
Group to agree terms with the 1992 Fund on which a claim for
Indemnification under this Agreement in respect of an Entered Ship (or
previously Entered Ship) may be brought directly against the Club insuring
the Ship at the time of the Incident. They also agree that in the event of
the 1992 Fund bringing proceedings to enforce a claim against a Club in
respect of an Entered Ship, the Club may require the Participating Owner to
be joined in such proceedings.
XI. LAW AND JURISDICTION
This Agreement shall be governed by English law and the English High Court
of Justice shall have exclusive jurisdiction in relation to any disputes
hereunder.
ANNEX 2
STOPIA – ADDITIONAL PROVISIONS FOR
THE MOU BETWEEN THE CLUBS AND THE 1992 FUND
Draft - 27/01/05
6A. STOPIA
i.
The following terms
in this Clause 6A shall have the same meaning as in Clause 1 of STOPIA:-
'Club', 'Indemnification', 'Insurance', 'Insured', '1992 Fund', 'Relevant
Ship', 'Entered Ship', 'Pollution Damage', 'Incident', 'Owner',
'Participating Owner', 'Liability Convention', 'Ship'.
ii.
The Clubs shall
provide cover, on terms similar to those governing other forms of oil
pollution risk, against any liabilities incurred by their members to pay
Indemnification to the 1992 Fund under the Small Tanker Oil Pollution
Indemnification Agreement (STOPIA).
iii.
In respect of
Relevant Ships, Club cover shall provide for automatic entry in STOPIA by
virtue of entry in the Club for Insurance against oil pollution risks.
However, nothing in this Clause 6A shall require the terms of Club cover -
a.
to apply such
automatic entry to any Ship the Owner of which expressly objects to
becoming a Participating Owner or has previously withdrawn from STOPIA; or
b.
to affect the right
of the Participating Owner to withdraw from STOPIA at a later date; or
c.
to exclude any Ship
not entered in STOPIA from cover against pollution risks.
iv.
a.
The Clubs, through
the International Group Secretariat, shall notify the 1992 Fund annually of
the names of all Ships entered in each Club which are Entered Ships.
b.
A Club shall notify
the 1992 Fund as soon as practicable of the name of any Entered Ship which
was not included in the most recent annual notification made to the 1992
Fund under Clause (iv)(a) above.
c.
A Club shall notify
the 1992 Fund as soon as practicable of the name of
1.
any Relevant Ship
which is accepted for entry in that Club for Insurance against oil pollution
risks without being or becoming entered in STOPIA; or
2.
any Ship which has
been entered in the scheme (whether as a Relevant Ship or pursuant to
Clause III(D) of STOPIA) and which ceases to be entered in STOPIA whilst
remaining insured against such risks by that Club.
v.
Where Pollution
Damage is caused by an Incident involving an Entered Ship, a claim by the
1992 Fund under STOPIA may be brought directly against the Club by which
the Ship is insured. The Club may avail itself of the defence that the Pollution
Damage resulted from the wilful misconduct of the Participating Owner
himself but it shall not avail itself of any other defence which it might
have been entitled to invoke in proceedings brought by the Participating
Owner against it. The Club shall in any event have the right to require the
Participating Owner to be joined in proceedings against it. Save as
aforesaid, any such proceedings against the Club shall be subject to the
same provisions of STOPIA as those applying to a claim against the Participating
Owner.
vi.
Where Pollution
Damage is caused by an Incident involving a Relevant Ship which is not an
Entered Ship at the time of the Incident, the 1992 Fund shall enjoy the
same rights against the Club insuring the Ship at that time as are set out in
Clause 6A(v) above, and notwithstanding that there is no liability under
STOPIA on the part of the Owner, unless the 1992 Fund has previously
received notice, whether under Clause 6A(iv)(c) above or otherwise, of the
Ship's non-entry (or cesser of entry) in STOPIA.
vii.
For the avoidance of
doubt, this Clause 6A does not apply to any Ship which at the time of the
Incident is not a Relevant Ship as defined by STOPIA, and it does not
confer on the 1992 Fund any rights of action against any insurer other than
the Club insuring the Relevant Ship at the time of the Incident.
viii.
Rights of direct
action conferred by this Clause 6A shall apply irrespective of whether the
Relevant Ship is required by Article VII of the Liability Convention to
carry a certificate of insurance.
ix.
Notwithstanding
Clause X(B) of STOPIA, the International Group undertakes to consult with
the 1992 Fund well in advance of any decision being taken if it considers
terminating or amending STOPIA, so as to enable the 1992 Fund to present
its views.
x.
This Clause 6A of
this Memorandum shall cease to have any effect in the event that STOPIA is
terminated in its entirety in accordance with Clause VIII thereof.
xi.
The 1992 Fund may
terminate Clause 6(A) by giving three months notice to the International
Group.
xii.
Any claims or
disputes in relation to Clause 6A of this Memorandum shall be governed by
English law and be subject to the exclusive jurisdiction of the English
High Court of Justice.
ANNEX 3
RECOMMENDED STOPIA CHARTERPARTY
CLAUSE
"Owner warrants that it is a Participating Owner and that the vessel
is entered in the Small Tanker Oil Pollution Indemnification Agreement
(STOPIA) and shall so remain during the currency of this charter, provided
always that:-
i.
the vessel is and
remains a Relevant Vessel as defined in cl.III of STOPIA.
ii.
STOPIA is not
terminated in accordance with cl. VIII of that agreement."
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