In April 2012, the Legal Committee of the International Maritime Organization (IMO) resolved to raise by 51% the limits of liability set out in article 6 and article 7 of the Convention on Limitation of Liability for Maritime Claims, 1976, amended by the Protocol of 1996 (LLMC 1996).
Therefore, on June 8, 2015, by means of the tacit amendment procedure set out in the LLMC1996, the 45 States that ratified the LLMC 1996 resolved to set the limits of liability for maritime claims at the following amounts:
- (i) for loss of life or personal injury
- (a) 3.02 million special drawing rights (SDR) (up from 2 million SDR) on ships not exceeding 2,000 gross tonnage; and for larger ships the following additional amounts are used in each case;
- (b) for each ton from 2,001 to 30,000 tons, 1,208 SDR (up from 800 SDR);
- (c) for each ton from 30,001 to 70,000 tons, 906 SDR, and for each ton in excess of 70,000 tons, 604 SDR (up from 400 SDR);
- (ii) for all other claims (including property claims)
- (a) million SDR for ships not exceeding 2,000 gross tonnage (up from 1 million SDR); and for larger ships the following additional amounts are used;
- (b) for each ton from 2,001 to 30,000 tons, 604 SDR (up from 400 SDR); and
- (c) for each ton from 30,001 to 70,000 tons, 453 SDR (up from 300 SDR), and for each ton in excess of 70,000 tons, 302 SDR (up from 200 SDR).
By setting these increased limits, the IMO has dealt with both the movements in the States’ currencies and with certain claims in connection with an oil spill where the amounts and claims were higher than the LLMC 1996 limits.
Although the increased limits will have an effect on the cost of P&I (protection and indemnity) coverage for the industry, this increase is seen as being intended to preserve the current limitation of liability system for shipping companies, a system which is fundamental for shipowners to be able to insure that liability.
Source: GARRIGUES Newsletter Transport and Shipping www.garrigues.com