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10 Things You Should Know About Fund Convention 92

Written by Capt Rajeev Jassal on November 7, 2016
47
fund-convention I have earlier discussed at length about the civil liability convention. If you want to know about fund convention, I would strongly recommend reading the civil liability convention first as both are connected. Here are few of the points to recap about civil liability convention. CLC applies to the pollution incidents of persistent oils. Leaving few exceptions, it is ship owner who needs to pay for the damages resulting from the oil pollution incidents The maximum liability of the ship owner in any one pollution incident would be limited to 4,510,000 SDR for the vessel up to 5000 GRT. For vessels more than 5000 GRT, maximum liability would be SDR 631 per addition GRT. Maximum liability, in any case, will not be more than SDR 89,770,000. All ships that carry more than 2000 T of oil as cargo need to maintain insurance equal to the ship owner's liability as per CLC 92. Let us come straight to the point. If we have the CLC convention then what is the need of fund convention? 1. Why Fund convention ? Now let me tell you a story (I always like stories !!!). There is a loaded oil tanker of 5000 GRT and it gets aground. The oil spilled into the water because of this grounding. The estimate of the damages because of this oil spills are more than 10 million SDR. We all know that ship owner nee...

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Comments (47)

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  • SUBODH PILLAI December 20, 2016
    Nice article... Very well explained.
    1

    Rajeev Jassal January 13, 2017
    Glad you liked it Subodh..

  • Elen January 12, 2017
    High-quality blog posts! I am currently studying for the ICS PQE and your articles are very-very helpful, please continue your great work!
    1

    Rajeev Jassal January 13, 2017
    Thanks Elen.. All the best for ICS PQE.

  • samuel February 10, 2017
    excellent piece of information -made everything as clear as possible
    1

    Rajeev Jassal February 10, 2017
    Thanks Samuel..

  • GANESAN K March 15, 2017
    Very very useful article....I found many of the very specific points that I was looking for a long long time.....Sir can you tell me where I can find the same article like this for Bunker convention & LLMC.?
    1

    Rajeev Jassal May 22, 2017
    I will try to cover those topics..

  • Shahnawaz Ansari April 12, 2017
    Sir kindly tell what proof does owner has that he has been covered by supplementary fund ?
    1

    Rajeev Jassal May 22, 2017
    Owners are not covered by Supplementary fund. Supplementary fund is a centralised fund which is contributed by the oil receivers of the countries that have ratified the fund convention.

  • tapan May 22, 2017
    Thank you sir, for clear explaination on fund and clc conventions
    1

    Rajeev Jassal May 22, 2017
    Glad you liked it Tapan..

  • karthigayan June 16, 2017
    Dear sir, nicely explained. if the claim is above 750 million SDR then who will pay? sir can u please explain what s the role of stopia and topia? thanking you
    0

  • Pravin June 16, 2017
    Excellent...very simplified explaination sir.
    1

    Rajeev Jassal June 23, 2017
    Thanks, Pravin...

  • Pravin June 16, 2017
    Sir, in the CLC,IOPC , qualification requirements for contracting governments,...is there any thing specified that oil recieved must be persistent?....or it just an Oil.
    1

    Rajeev Jassal June 23, 2017
    Yes, it is oil received must be persistent oil. In these conventions, it is mentioned that "for the purpose of this convention, “Oil” means any persistent hydrocarbon mineral oil such as crude oil, fuel oil, heavy diesel oil and lubricating oil, whether carried on board a ship as cargo or in the bunkers of such a ship".

  • Manil Kori June 23, 2017
    As per your statement 'Unlike funds maintained as per fund convention, supplementary fund does not collect and maintains the funds.It only collect the contributions when it needs to pay for any claims." But as per IOPC official website it says "Annual contributions to the Supplementary Fund are made on the same basis as contributions to the 1992 Fund. However, the contribution system for the Supplementary Fund differs from that of the 1992 Fund in that, for the purpose of paying contributions, at least 1 million tonnes of contributing oil are deemed to have been received each year in each Member State". Thus i think both Fund and Supplementary fund contribute annually and maintain funds.
    1

    Rajeev Jassal June 23, 2017
    Thanks Manil for correcting me. I have made the correction now.

  • ASHUTOSH KUMAR August 15, 2017
    hello sir, my quiestion is who will pay if the oil pollution occur in high sea?
    1

    sunil singh August 23, 2017
    In high seas oil pollution resulting to loss of life or loss of property will be paid as per intervention convention.

  • Alinno Ann November 24, 2017
    Bravo, thanks for the good work. I want to know where and where (Incidents) have these laws been applied
    0

  • Ekeh Chisaa December 1, 2017
    Nice article. Pls which country has benefited from the provisions of either Fund Convention or supplementary Fund Convention and how much was paid in each incident. Thank u
    0

  • Kanav Malhotra December 6, 2017
    Very well explained. Easy to understand. Thanks sir. Please keep posting articles. Also post if you have unclos
    0

  • Aditya January 18, 2018
    Can IOPC fund give compensation before the compensation is paid by the tanker through P&I club?
    0

  • madhu kumar January 22, 2018
    Sir, can you please explain what is deffered call?
    0

  • Manish April 14, 2018
    So in supplementary fund, compensation to be paid by whom contracting state or receiving companies of that state? Please clear
    0

  • ANoop April 23, 2018
    I have read most of your articles. Really different from everyone. You undarstand the mind of a learner and explains in a simple way understood by anyone. Keep posting again congrata
    0

  • Veerappan Durairaj June 17, 2018
    Asper DG shipping web site, india not ratified the CLC 1992 and fund convention 1992, India ratified only the CLC 1969 convention, now if indian flag vessel need to call france, which is party to the 1992 clc convention, who will issue the CLC certificate for the indian vessel as per clc 1992. or the vessel can call france with the clc 1969 certificate. kindly clarify.
    0

  • Jay Shah July 11, 2018
    If pollution occurs in territorial water and limits of CLC have been exhausted, who shall pay if the state is not party to the IOPC Fund?
    1

    sumeet bose September 22, 2018
    No one pays .... the coastal state looses out . That is why is coastal states requires Benifit of additional compensation of fund convention they need to ratify it .....

  • Kaushal sharma December 8, 2018
    Sir very very helpful notes is there .thanks a lot sir
    0

  • Ravindra February 1, 2019
    Who will pay on high sea?
    0

  • Biju Antony April 29, 2019
    Excellent work ....really commandable
    0

  • Ajay yadav August 13, 2019
    Nice article sir....but sir can u tell me if any certifactes are issued or maintained on board regarding fund and supplementry convention
    0

  • Prasad October 7, 2019
    fund convention is not mandatory and maximum liability on a shipowner for single incident is fixed as per CLC 92. However big the pollution incident takes place but liability of owner is fixed as per CLC 92. So why states go for fund convention when they have to pay extra permium for it (funded by oil recievers).
    0

  • Amar Anand March 28, 2020
    Very nice article sir....very nicely explained....Appreciate your efforts....gradually i am going through all articles...please upload article on LLMC convention, and Djibouti code. Thanking you
    0

  • Binod kumar October 1, 2020
    Very nice sir
    0

  • ANILKUMAR BHAT March 9, 2021
    Very Nicely explained sir. Please try to cover Bunker convention and HNS also in future.
    0

  • Zhu Wenfu April 14, 2021
    One question about the Supplementary fund - is that fund entitled for non - tanker ships? eg. Bunker convention.
    0

  • Mangesh Bhangale May 3, 2021
    what is SDR?
    1

    ankit October 28, 2022
    special drawing rights........The currency value of the SDR is determined by summing the values in U.S. dollars, based on market exchange rates, of a basket of major currencies (the U.S. dollar, Euro, Japanese yen, pound sterling and the Chinese renminbi). The SDR currency value is calculated daily (except on IMF holidays or whenever the IMF is closed for business) and the valuation basket is reviewed and adjusted every five years.

  • Shailesh k. Yadav May 22, 2021
    what will happen if pollution happend due to non persistent oil
    0

  • uthandaraj kasiraj June 22, 2021
    If oil pollution takes place in same contracting states for more times (ie .3 times). In such a case is there any limitation on Fund?
    0

  • HEMANTH KUMAR October 11, 2021
    Good day sir, Who would pay if the expenses go beyond 750 M sdr. This question was asked to me during my cls 1 orals.
    0

  • Arshaan Shaikh April 8, 2022
    Good day sir,your blogs are very helpful. Thanks. Just wanted to confirm about FUND limits. As per IMO site, if oil rcvd by 3 contractions states is more than 600 mill tons then the Max amount is raised buy 200 million SDR. Pls share some explanation.
    0

  • waleed November 28, 2022
    if the pollution comes from a ship under the flag part of CLC 92 only and it is not worthy for sailing( no insurance, not comply with IMO conventions ) and the pollution reaches another country which is part of CLC 92 and Fund 92 . who shall pay the expenses
    0

Capt Rajeev Jassal

About Capt Rajeev Jassal

Capt. Rajeev Jassal has sailed for over 24 years mainly on crude oil, product and chemical tankers. He holds MBA in shipping & Logistics degree from London. He has done extensive research on quantitatively measuring Safety culture onboard and safety climate ashore which he believes is the most important element for safer shipping.

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