A Worldwide Review of Marine Oil Spill Fines and Penalties
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A Worldwide Review of Marine Oil Spill Fines and Penalties
By Dagmar Schmidt Etkin, Ph.D. Environmental Research Consulting 41 Croft Lane Cortlandt Manor, NY 10567-1160 USA www.environmental-research.com
A Worldwide Review of Marine Oil Spill Fines and Penalties Table of Contents Introduction Oil Spill Penalties in North America United States Federal Coastal States Alabama Alaska California Connecticut Delaware Florida Georgia Hawaii Louisiana Maine Maryland Massachusetts Mississippi New Hampshire New Jersey New York North Carolina Oregon Pennsylvania Rhode Island South Carolina Texas Virginia Washington Canada Mexico
Oil Spill Penalties in Latin America Panama Chile Brazil Venezuela Oil Spill Penalties in Europe and the Russian Federation Netherlands Greece Germany United Kingdom Finland Ireland Norway Sweden Denmark France Estonia Latvia Lithuania Poland Russia Ukraine Albania Bulgaria Oil Spill Penalties in Africa Kenya Nigeria South Africa Mauritius Oil Spill Penalties in Asia Australia Thailand People’s Republic of China Singapore Japan Taiwan Vietnam India Kampuchea (Cambodia) Philippines Malaysia Indonesia
Appendices Sample Cases of Oil Spill Fines and Penalties Per-Tonne Oil Spill Fines and Penalties Per-Gallon Oil Spill Fines and Penalties International Summary of Marine Oil Spill Fines and Penalties US Coastal State Oil Pollution Liabilities, Fines, and Penalties
© 2003 Environmental Research Consulting
Worldwide Review of Marine Oil Spill Fines and Penalties Introduction Violations of national laws and international conventions regarding the discharge of oil into marine waters is generally subject to some sort of penalty imposed by national authorities, though the severity of these penalties varies greatly between nations and even between offenses within the same nation. Spills ranging from bilge washing or other illegal but intentional discharges from ships, to major accidental oil spills due to groundings or collisions, are all subject to fines and other penalties in many nations, especially those that are parties to the International Convention for the Prevention of Pollution from Ships 1973, as Amended in 1978 (known as “MARPOL 73/78”) and various regional conventions. FACTORS CONSIDERED IN SETTING PENALTIES •
Amount of oil spilled
Degree of spiller culpability
Whether spill was reported to authorities in required time
Environmental and/or property damages resulting from spill
Spiller efforts to respond to spill or mitigate impacts
Financial gain or benefit of noncompliance of discharge regulations
Most national legislation regarding oil pollution fines and penalties related to shipsourced pollution is based on national implementation of these international conventions, which requires that the signatory country enact laws to carry out the actions and responsibilities outlined in the treaties. Factors Affecting Fines and Penalties The fine and/or prison term is imposed by a court in the jurisdiction in which the alleged violation occurred or . If the fine is not pre-determined or purely based on the amount of oil spilled, the court generally takes into account a number of contributing factors in setting the fine or penalty.
Often courts are also influenced, at least to some degree, by more “emotional factors,” such as the notoriety of the spiller, public reaction to the spill, the political climate at the time of the spill, the location of the spill, or the history of other similar incidents by other parties. Certainly, a number of courts have sentenced convicted violators to “precedent-setting” fines or penalties to “set an example for others.” © 2003 Environmental Research Consulting
There appears to be a trend in the last few years to strengthen fines, to begin imposing pollution fines if none previously existed, and to enhance enforcement policies in an effort to increase compliance with MARPOL 73/78 and other international and regional conventions related to marine oil pollution, as well as national laws regarding the spillage of oil. This report contains descriptions of oil spill fine and penalty schemes currently in place in 42 nations, as well as case studies of fines and penalties imposed in specific oil spill cases. The magnitude of the fines and penalties varies considerably from one nation to another based on legal and socioeconomic factors in each nation. What may be considered an excessive fine to the inhabitant of one nation may seem miniscule if imposed at the same level in another nation (particularly when the fine amounts are REGIONAL OIL POLLUTION TREATIES converted from national currency into US currency for comparison Bonn Agreement (North Sea) purposes). Helsinki Agreement (Baltic Sea) It is important to bear in mind that the regulations may change at any time, and that the penalties imposed in a particular case may fall outside the parameters described because of specific circumstances surrounding that pollution incident. Additionally, violations, particularly by ships, can fall under several jurisdictions and may expose the spillers to several levels of fines.
Oslo Convention (North Atlantic Ocean) Barcelona Convention (Mediterranean Sea) Kuwait Convention (Persian Gulf) Jiddah Convention (Red Sea/Gulf of Aden) Adidjan Convention (West/Central Africa) Nairobi Convention (East Africa) Lima Convention (Southeast Pacific Ocean) Noumea Convention (South Pacific Ocean) Cartagena Convention (Caribbean Sea)
Jurisdictional Issues for Ships When oil spills from land-based sources, such as refineries or storage terminals, it is clear that the national government, and possibly the state, provincial, or local government, has jurisdiction and can imposed various fines and penalties as stipulated by relevant pollution laws. When oil pollution can be traced to a moving source – i.e. a ship – the issue of jurisdiction becomes much less clear and is potentially wrought with the complexities of international law. The jurisdictional issue for oil pollution cases is addressed by international conventions, particularly MARPOL 73/78 and, to some extent, the International Convention Relating to Intervention on the High Seas in Cases of Oil Pollution Casualties 1969 (known as the “Intervention Convention”). © 2003 Environmental Research Consulting
The Intervention Convention, drafted by the International Maritime Organization in the wake of the spill from the Liberian tanker Torrey Canyon which impacted the British coastline. The spill was a painful reminder that flag states cannot always be relied upon to contain pollution from marine casualties before they adversely affect coastal nations. Before the entry into force of the Intervention Convention in 1975, coastal nations had no right to take action against spills outside of territorial waters even if the incident impacted their waters or coastlines. The Intervention Convention gives signatories the right to intervene in the high seas if deemed necessary to protect their interests after notification of the flag state. MARPOL 73/78 allows a coastal state to report a pollution violation to the flag state of the vessel. The flag state, if it is a MARPOL 73/78 signatory, is then obligated under the convention to facilitate action against the offending ship. Flag state jurisdiction is a long-standing rule of international law. The affected coastal state can only prosecute an alleged violator when the violation took place in the nation’s own territorial waters. When there is question as to where the violation actually took place, the coastal or port state can report the violation to the appropriate flag state for action.
Parties to MARPOL 73/78 are obligated to enact national legislation that allows for the prosecution of vessels that spill oil or violate oil prevention regulations within their territorial waters and vessels that commit violations in other nation’s waters or on the high seas while flying under the nation’s flag.
Despite the fact that MARPOL 73/78 allows coastal and port states to prosecute violators under certain conditions, they have not often exercised that right. Even the US whose officials upon ratifying the convention declared their intentions to “prosecute all violators” has rarely been successful. Public prosecutors proceeding against shipmasters have often faced difficulties in determining the exact location of a discharge violation which leaves the issue to the flag state in most cases. In other cases there have been complexities involved in gathering evidence such as oil fingerprinting. Flag states have also not aggressively prosecuted flagship violations outside of their territorial waters. The Changing Scene of Oil Pollution Prosecution The outlook for oil pollution prosecution appears to be changing, however. There has been a dramatic increase in fines and penalties imposed and an increase in the level of those fines and penalties. Several recent high-profile cases of hefty fines and prison sentences for polluters have struck a nerve in the international shipping community as well as made owners of land-based facilities more vigilant. Stiff penalties are not only the purview of the US or EU nations. Recently, a tanker © 2003 Environmental Research Consulting
captain was detained in Venezuela for over one year for an oil spill resulting from a grounding on an uncharted object in the shipping channel. For the first time, a Singapore court sentenced a tanker captain to imprisonment for oil record book violations. Record fines were recently imposed for spills in Brazil. Flag states are also taking greater responsibility. The first successful US prosecution of a high-seas MARPOL 73/78 violation occurred in 1997 for an offense from a US-flagged vessel that occurred in 1993. Surveillance efforts for nabbing polluters are escalating and advancing technologically, as are cooperative efforts among nations with respect to surveillance programs. Canada has been particularly active in this arena with an enhanced surveillance program in North Atlantic waters. In 1999, a Canadian judge imposed a record fine on the operator of a ship caught by aerial surveillance without chemical analysis of oil samples. Another advance in dealing with the coastal versus flag state issue, which has gained popularity in the last decade, is port state control. This approach controls the entry into port of foreign-flagged ships through inspection for MARPOL violations. Though it is the responsibility of flag states to inspect its ships to insure that they are operating at uniformly high standards as set by international conventions, this is not always carried through Port state authorities have taken the matters into their own hands and are increasing inspections to catch discharge violations and other oil prevention violations on problematic minority of noncompliant vessels.
EU MEMORANDUM OF UNDERSTANDING ON PORT STATE CONTROL Alerting other nations and ports on inspection results Sharing identities of violators through computerized database Increased inspection and detention Aerial surveillance to detect illegal discharges at sea Issuance of all-points-bulletins to ports concerning dischargers
Violating vessels are detained in port, which gives an economic incentive for compliance with pollution regulations. Reporting violations to other ports that then bar entry to non-compliant vessels creates further economic loss – and hence incentive for compliance - for vessel operators. The economic factors may act as a greater incentive than fines and penalties in some cases. Memoranda of understanding (MOU) and cooperation between various port states have increased the inspection and vessel detention levels, as well as the effectiveness of port state control. The EU and many other nations are participating in these agreements. © 2003 Environmental Research Consulting
© 2003 Environmental Research Consulting
MARPOL 73/78 SIGNATORIES (as of August 2000)
Algeria Antigua & Barbuda Argentina Australia Austria Bahamas Barbados Belarus Belgium Belize Benin Bolivia Brazil Brunei Darussalam Bulgaria Cambodia Canada Chile China (inc. Hong Kong) Colombia Cote d'Ivoire Croatia Cuba Cyprus Czech Republic Dem. Rep. Korea Denmark Djibouti Dominica Dominican Republic Ecuador Egypt Equatorial Guinea Estonia Finland France Gabon Gambia
Georgia Germany Ghana Greece Guatemala Guyana Hungary Iceland India Indonesia Ireland Israel Italy Jamaica Japan Kazakhstan Kenya Latvia Lebanon Liberia Lithuania Luxembourg Malaysia Malta Marshall Islands Mauritania Mauritius Mexico Monaco Morocco Myanmar Netherlands New Zealand Norway Oman Pakistan Panama
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Papua New Guinea Peru Poland Portugal Rep. of Korea Romania Russian Federation Saint Kitts and Nevis Saint Lucia St. Vincent & Grenadines Sao Tome & Principe Senegal Seychelles Singapore Slovakia Slovenia South Africa Spain Sri Lanka Suriname Sweden Switzerland Syrian Arab Republic Togo Tonga Trinidad & Tobago Tunisia Turkey Tuvalu Ukraine United Kingdom United States Uruguay Vanuatu Venezuela Viet Nam Yugoslavia
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Oil Spill Penalties in North America United States The US has the reputation of having the most Spillers in US waters face stringent regulations worldwide with regard to the strictest fines and marine oil spills, including a strict system of penalties worldwide on both fines and penalties – both on the federal level the federal and state levels. and in each of the coastal states. In some spill situations, the responsible party (RP), or even the cleanup contractor hired by an RP can face criminal fines or civil penalties because of alleged negligent conduct. In some cases an otherwise fully-compliant RP can wind up in an accidental situation resulting in the spillage of oil and thus incur a penalty for an accidental discharge, as a violation of the Oil Pollution Act of 1990 (OPA 90).
US Civil Penalties US Coast Guard Civil Penalties Spillers who violate the statutes of the US Federal Water Pollution Control Act (FWPCA) and the US Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA) are subject to civil penalties (see Figure 1). The USCG enforces the FWPCA violations broadly, processing about 3,400 violations annually. The more limited nature of the CERCLA violations has led to the initiation of only a few cases each year. Methods of Enforcement OPA 90 provided the US Coast Guard with greater judicial and administrative means to pursue even higher monetary penalties against responsible parties for flagrant violations under more formal court proceedings.
Until the enactment of OPA 90, the US Coast Guard (USCG) only had the authority to adjudicate FWPCA and CERCLA violations through information and non-adversarial administrative hearings. OPA 90 provided the USCG with greater judicial and administrative means to pursue even higher monetary penalties against RPs for flagrant violations under more
formal court proceedings. The USCG can now adjudicate violations under the existing pre-OPA 90 or “Class © 2003 Environmental Research Consulting
I” procedures, or adjudicate under the new “Class II” or “Judicial Civil Penalties (JCP)” forums, depending on the severity of the violations. According to the USCG, Class II and JCP enforcement options provide a more measured civil penalty to fit the serious nature of the FWPCA and CERCLA violations. These cases will undoubtedly take more time to close, but will provide a more effective deterrence to would-be violators.
Figure 1: Comparison of FWPCA/CERCLA Civil Penalties FWPCA CERCLA Oil and hazardous material spills Violation of statutes: Violation of regulations for • Requirements for Civil penalty facilities transporting oil in bulk code of financial enforcement responsibility • Violation of regulations for applicability pollution prevention by vessels • Failure to report release • Oil transfer operations Statutorily driven: • Seriousness (nature of offense; impact/threat to health, welfare, and environment; duration of days; number of violations; volume spilled) Policy driven: • Culpability Factors in • Merits of each determination • Prior violations case (e.g., repeat of appropriate • Degree of success of any offenders merit mitigation efforts by the potencivil penalty higher penalties) tial responsible party • Economic benefit of noncompliance • Penalties imposed by state/local governments • Other relevant factors Source: Etkin 1998, Financial Costs of Oil Spills in the United States • •
Class I Penalties Under OPA 90 and CERCLA, the USCG can assess a civil penalty on any owner, operator, or person in charge of a vessel, onshore facility, or offshore facility, who fails to notify the appropriate authorities of the discharge of oil or who fails or refuses to comply with regulations issued under the National Response System. The maximum civil penalty for class I penalties is US$10,000 per violation, but not more than © 2003 Environmental Research Consulting
US$25,000 per case. The USCG generally holds a hearing at the request of the RP where the RP then has the opportunity to present evidence in its defense. Class II Penalties For more flagrant violations, the USCG has the option of imposing class II penalties, which may not exceed US$10,000 per day for each day of violation up to a maximum of US$125,000. With the enactment of OPA 90, the USCG received the authority to issue rules regarding hearing procedures for these penalties. On 30 March, 1994, the USCG issued a final rule concerning practices and procedures for assessing class II civil penalties. The final rule on class II penalties is divided into the following sections: •
Administrative law judges (ALJs): The ALJ administers, hears, and decides class II civil penalty cases, and specifically has the power to: schedule and hold settlement conferences; rule on pre-hearing motions or any other motions that may occur during a hearing; order discovery; and adjudicate a case and prepare a proposed order.
Pleadings and motions: The USCG will send or hand deliver a complaint to the respondent, to which the respondent must reply within 20 days after service of the complaint. If the respondent does not file an answer, or appear at a hearing, then the ALJ may issue a default judgment. A party may be represented by himself or herself, an attorney, or any other authorized representative, provided that the representative files a notice of appearance. All documents related to the penalty proceedings must be sent to USCG headquarters in the format outlined in the rule.
Proceedings: The rule establishes procedures for participation in class II penalty proceedings, as well as procedures for pre-hearings and settlement discussions. The final rule does not permit "non-party" intervention. The USCG argues that "permitting non-parties to intervene would not be appropriate for class II proceedings . . . the provisions of the interim final rule [published in April 1993] allow an appropriate mechanism for nonparties to present additional relevant information to the administrative law judge."
Discovery: Based on the Federal Rules of Civil Procedure, the final rule establishes limited discovery requirements that authorize the ALJs to order discovery as appropriate. The rule addresses: interrogatories, requests for documents, depositions, protective order, sanctions for failure to comply, subpoenas, and motions to quash or modify.
Hearings: The next phase covers such issues as scheduling and notice of the hearing, procedures to follow when the party fails to appear at the hearing, the role of witnesses, and telephone testimonies. © 2003 Environmental Research Consulting
Evidence: This phase includes the determination of the admissibility of evidence, objections and offers of proof, hearsay evidence, proprietary information, official notice, exhibits and documents, and written testimony.
Decisions and orders: The rule allows any party to request a summary decision at any time up to 15 days before a hearing.
Appeals: The rule provides for appeals on any question of law or finding of fact. An appeal must be submitted to the USCG commandant within 60 days after service of the ALJ's decision and order.
Judicial Civil Penalties The federal government may also, in lieu of USCG penalties, assess larger civil penalties by action in the US district court in any district in which the responsible party is located, resides, or is doing business. The owner, operator, or person in charge of a vessel illegally discharging oil can also be assessed penalties of up to US$25,000 per day of violation or up to US$1,000 per barrel [US$24/gallon or US$7,000/tonne] of oil spilled. In the case of proven gross negligence or willful misconduct, these penalties may be increased to not less than US$100,000 and not more than US$3,000 per barrel [US$71/gallon or US$21,000/tonne] of discharged oil. The responsible party can also be subject to a penalty of up to US$25,000 per day or up to three times the costs incurred by the Oil Spill Liability Trust Fund as a result of failure to comply with a removal order. EPA Civil Penalties In some oil spill cases, particularly those involving land spills or spills in inland waterways, the US Environmental Protection Agency (EPA) has the authority under OPA 90 to impose civil penalties on oil spillers. Prior to OPA 90's implementaEPA’s civil penalties are based on tion, according to the Federal Water gravity and economic benefit. The Pollution Control Act (Clean Water gravity component reflects the Act), a violation of EPA oil spill seriousness of the violation. regulations (including an unauthorized The economic benefit component discharge of oil) was limited to an focuses on the violator’s economic administrative penalty of up to gain from noncompliance. US$5,000 per day of violation. OPA 90 amended the Clean Water Act, however, stating that violators may be assessed a Class I penalty of up to US$10,000 per violation (up to a maximum of US$25,000), or a Class II penalty of up to US$10,000 per day of violations (up to a maximum of US$125,000). © 2003 Environmental Research Consulting
In addition, OPA 90 elevated the penalty for failing to notify the government of a discharge from a misdemeanor (which carries with it a fine of not more than US$10,000 or imprisonment for not more than one year, or both) to a felony. OPA 90 mandates that this felony carries with it a fine based on a formula in accordance with title 18 of the US Code, or imprisonment for not more than five years, or both. OPA 90 also allows EPA to seek judicial civil penalties of up to US$25,000 per day of violation or US$1,000 per barrel [US$24/gallon or US$7,000/tonne] of oil, and, in the case of willful misconduct, a civil penalty of not less than US$100,000 and not more than US$3,000 per barrel [US$71/gallon or US$21,000/tonne] of oil. Previously, EPA could only seek judicial civil penalties up to US$50,000 per violation or up to US$250,000 for discharges resulting from willful misconduct. Calculation of Economic Benefit of Noncompliance The EPA’s civil penalty program is based on two components: gravity and economic benefit. The gravity component reflects the seriousness of the violation and is generally determined through the application of the appropriate civil penalty policy. The economic benefit component focuses on the violator’s economic gain from noncompliance, which may occur in one of three ways. The violator can be shown to: • • •
Delay necessary pollution control expenditures; Avoid necessary pollution control expenditures; and/or Gain an illegal competitive advantage during the period of noncompliance.
Competitive advantage may occur if, for example, a company engages in illegal practices and is thus able to capture additional market shares by selling its products or services at a lower cost than its compliant competitors. The EPA uses a computer model called “BEN” (“Benefits of Environmental Noncompliance”) to establish an appropriate penalty. This model is designed to estimate the degree to which an offender has financially benefited from not complying with spill prevention regulations. For example, if it costs US$300,000 to install an appropriate safety check valve in a tanker, the penalty for failing to install this required equipment should be at least US$300,000. The model requires inputs on: capital investment; one-time non-depreciable expenditure; annual expenses; useful life of pollution control equipment; marginal income tax rates; inflation rates; and discount rates. [Note: This model can be downloaded at http://www.epa.gov/oeca/datasys/dsm2.html.] First OPA 90 Judicial Settlements © 2003 Environmental Research Consulting
On 10 February 1993, the Department of Justice (DOJ) filed the first two judicial settlements under OPA 90 with a US district court in Washington State. The settlements totaled US$14.7 million in civil penalties, cost recovery, and cleanup costs, and resolved two complaints brought by DOJ (on behalf of the USCG and the EPA) against Texaco Refining and Marketing, Inc., and US Oil & Refining Company. DOJ brought the first complaint against Texaco for a 210,000-gallon [714-tonne] pipeline oil spill in Anacortes, Washington, on 22 February 1991, and four additional spills, resulting in the discharge of a total The US$14.7 million Department of 400 gallons [1.4 tonnes] of oil, at the of Justice settlements for a same location. The second complaint 210,000-gallon Texaco Refining against US Oil involved a 600,000-gallon spill and a 600,000-gallon US Oil [2,041-tonne] pipeline oil spill in pipeline spill demonstrated that Tacoma, Washington, on 6 January 1991. OPA 90 had “put teeth into” the In both cases, the DOJ sought civil federal spill law. penalties, cost recovery for monies spent by the US government, and agreements from the companies to continue mitigating spill damage and prevent future spills. The settlements were hailed by US officials as proof of OPA 90's impact. DOJ said that these cases against Texaco Refining and Marketing and US Oil demonstrated that OPA 90 had “put teeth into” the federal oil spill law. This could not have been achieved under previous law. Under OPA 90, responsible parties are liable for a civil penalty of up to US$1,000 per barrel [US$24/gal or US$7,000/tonne] of oil or unit of reportable quantity of hazardous substances discharged. This would not have been possible under the Clean Water Act. In fact, in the past, EPA would not have had jurisdiction in these cases. According to a memorandum of understanding between EPA and the USCG, the USCG took charge of the oil spill cases and EPA took the charge of cases on hazardous wastes. This time, however, EPA was the first to send an on-scene coordinator to the US Oil spill and consequently became lead agency on that case; the USCG was lead agency in the Texaco case. Case Study: Texaco Settlement Under the terms of the Texaco settlement, Texaco agreed to continue the spill cleanup in Anacortes at a cost of US$8 million, to install and maintain state-of-the-art spill prevention equipment at a cost of nearly US$800,000, pay the government's removal costs of US$125,000, and pay a civil penalty of US$480,000 to the US government. Texaco had already paid a US$20,000 civil penalty to the state of Washington. The settlement required Texaco to carry out activities in the areas of cleanup and © 2003 Environmental Research Consulting
prevention and to perform an environmental audit of certain pipelines at the Anacortes facility. With regard to the cleanup response, Texaco agreed to carry out activities according to a plan that accompanied the settlement agreement. The plan listed specific actions that Texaco had to take, or in some instances had already taken, and listed deadlines for the completion of these actions. The spill plan also required Texaco to install groundwater monitoring devices at locations selected by the Washington Department of Ecology and to land farm a portion of oil-contaminated soil. The settlement also contained a detailed oil spill prevention plan for the Texaco facility. The plan specified the tasks Texaco had to complete and deadlines for completion. The tasks included: • • • • • • •
Installation of a video camera at certain locations to allow pipeline operators to more quickly detect spills; Installation of a system of gated valves at certain locations to prevent the flow of oil through culverts; Installation (within 12 months of DOE publication of oil spill prevention standards) of a continuous leak detection system on all dock transfer lines; Installation, testing, and maintenance of automated line shutoff equipment; Identification of all remaining pumps in the refinery with cast-iron casing and inspection of each pump to determine its structural integrity; Annual pressure testing of all dock lines and submission of standard operating procedures to DOE; and Performance of ultrasonic tests on all above-ground transfer lines at intervals not exceeding three years and submission of standard operating practices to DOE.
The settlement required Texaco to submit a written report to the USCG and DOE within 30 days of performing all tasks outlined in the spill prevention and cleanup plans. The report was to be approved by a professional engineer. Had Texaco failed to comply with the items listed in the spill cleanup and prevention plans by the listed deadlines, it would have been subject to penalties of US$500 per day for days 1-30 and US$1,000 per day thereafter. Case Study: US Oil Settlement Under the terms of the US Oil settlement, the company agreed to complete the cleanup of the spill site at a cost of approximately US$4 million, to install and maintain state-of-the-art spill prevention cleanup equipment at a cost of US$800,000, to pay the government's removal costs of almost US$60,000, and to pay a civil penalty of US$425,000 to the US government. US Oil & Refining had already paid a US$45,000 civil penalty to the state of Washington. As in the Texaco settlement, the US Oil settlement contained a spill cleanup plan © 2003 Environmental Research Consulting
and a spill prevention plan. It did not contain a requirement for US Oil to conduct an environmental audit. US Oil had already completed all of the items listed in the oil spill cleanup plan. It had also completed some of the items listed in the oil spill prevention plan, including installation of a leak detection system, replacement of line markers, and an increase in the number of pipeline inspections. The prevention plan listed a number of items that US Oil had left to complete. These included: • • • • •
Installation of gear reducers on critical pipeline isolation valves to allow closing in a timely fashion; Evaluation of pressure relief of all transfer pipelines in certain areas; Review of US Oil's facility operations manual; Evaluation of the need for cathodic protection for all buried pipelines; and An upgrade to supports under certain dock lines.
As in the Texaco settlement, US Oil had to verify in writing to the USCG and DOE that it had performed this work. Had US Oil failed to comply with the terms of the spill cleanup or prevention plans, it would have been subject to fines of US$100 per day for days 1-15, US$500 per day for days 16-30, and US$1,000 per day thereafter.
US Criminal Fines/Penalties The federal government can also assess criminal fines of US$25,000 per day of violation and/or one year imprisonment against a party that negligently causes an oil spill. “Knowingly” causing a spill Though OPA 90’s criminal fines are based may lead to fines of up to on the responsible party “knowingly” US$50,000 per day of violation violating regulations, government prosecuand/or up to three years impristors often seek to convict corporate, onment. “Knowingly” violating supervisory, and operational personnel OPA 90 regulations with the even when there has been no criminal knowledge of seriously endangerintent, or knowledge of a criminal act or ing another person holds penalties omission. of up to US$250,000 in fines and/or up to 15 years imprisonment in the case of an individual and up to US$1 million in fines for a corporate violator. With the second offense, each of these maximum penalties doubles. Though OPA 90’s criminal fines are based on the responsible party “knowingly” violating regulations, government prosecutors often seek to convict corporate, supervisory, and operational personnel even when there has been no criminal intent, or knowledge of a criminal act or omission. The government contends that corporate personnel are criminally liableConsulting as they © 2003 Environmental Research an obligation to supervise an operation and to detect and prevent a particular criminal act from occurring.
Both corporations and individuals are presently exposed under OPA 90 to severe criminal penalties 17
relative to oil spills and related federal violations. In the wake of substantial public interest, government prosecutors exhibit great “zeal” in pursuing criminal penalties against corporate and individual violators. The government has contended that corporate personnel are criminally liable because they are “responsible corporate officials with an obligation to supervise an operation and to detect and prevent a particular criminal act from occurring.” The government has thus sought to impose strict criminal liability, that is, criminal liability on an individual without a specific criminal act or specific intent.
New Developments in Liability and Penalty Legislation In late July 2000, two pairs of bills pertinent to oil spill liability and penalties were introduced into the US Congress: •
Zero Tolerance For Repeat Polluters Act of 2000 (H.R. 5077 & S. 2934): These bills (one each to the House of Representatives and to the Senate) provide for the assessment of increased civil penalties in cases in which: 1.) a person or entity that is the subject of a civil enforcement action has previously violated an environmental law; or 2.) a violation of an environmental law results in a catastrophic event.
Affirmation of Penalties Under Oil Pollution Act of 1990 (H.R. 5100 & S. 2944): These bills (one each to the House of Representatives and to the Senate) provide for a clarification that certain penalties provided for in OPA 90 are the exclusive criminal penalties for any action or activity that may arise in connection with certain discharges of oil or a hazardous substance. This bill is aimed at changing the definition of liability for oil spills in as much as “strict liability,” as currently exists in OPA 90, calls for criminal sanctions without requiring a showing of “knowledge” or “intent” as a basis for criminal prosecution for oil spill incidents. The sponsors of this bill are of the opinion that federal actions imposing strict liability “have created an atmosphere of extreme uncertainty for the maritime industry about how to respond to and cooperate with the government and federal agencies in cleaning up an oil spill.” The Congressional sponsors have stated that “Such criminal liability statutes as the Migratory Bird Treaty Act and the Refuse Act, statutes that were enacted at the turn of the [last] century to serve other purposes, have been used to harass and intimidate the maritime industry, and, in effect, have turned every oil spill into a potential crime scene without regard to the fault of intent of companies, corporate officers and employees, and mariners.” The bill would impose criminal liability only where a discharge is caused by conduct which is truly “criminal” in nature, i.e. where a discharge is caused by reckless, intentional, or other conduct deemed criminal by OPA 90.
US State Fines and Penalties © 2003 Environmental Research Consulting
In addition to federal, civil, and criminal penalties imposed by OPA 90, RPs are also separately subject to state penalties and fines in many situations. The following pages show the discharge penalties and other penalties imposed by all US coastal states. In nearly all spill situations, the RP is required by state and federal law to “immediately” notify the appropriate authorities of the discharge of oil or the probable discharge of oil. The definition of “immediately,” however, is sufficiently vague and subjective to cause considerable misunderstanding, particularly when “failure to notify” carries stiff penalties on the state and federal levels. The vagueness of the time limit for spill reporting has worried agency officials and legislators in that it does not fully stress the importance of alerting the right authorities quickly following a spill or threat of a spill, nor does it pave a clear path for penalty assessment when a spiller fails to report a All of the tough new state stanspill, since the meaning of the word is open to dards are meant to send a interpretation. Nearly a dozen states have message to potential spillers implemented or are in the process of implethat state authorities want to menting stricter notification requirements. be informed of a spill and be That is, they have defined “immediately” as assured that the responsible anywhere from 72 hours to 15 minutes from parties are handling the the time of the spill, or from the time the situation effectively. person has knowledge of the spill. The trend toward amending spill reporting requirements was not necessarily prompted by a specific incident. In terms of spill violations, “failure to report” is not a high priority; and for those that fail to report, states have had no trouble assessing minor penalties. Rather, the issue seems to have been combined with an agenda of sending the message that state authorities want to be informed of a spill and be assured that the responsible parties are handling the situation effectively. The state reporting requirements usually specify: • • • • •
The minimum amount of oil spilled that must be reported; Who in the company is responsible for reporting; What information should be included in the report; To whom they should report; and If reporting to the USCG National Response Center satisfies obligations.
Some states have also opted to increase the maximum civil (and sometimes criminal) penalty for failure to report a spill. Maximum state civil penalties range up to US$250,000 per day. Some states more often assess criminal fines. Though minor penalties and settlements are common, cases resulting in a maximum penalty are rare.
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In the US, spill fines and penalties are generally steep in order to act as a deterrent to potential polluters. In addition, most other aspects of OPA 90 are arguably the most stringent worldwide. However, the most significant factor in deterring oil spills, and the factor that has probably shown the most influence on reducing the number of spills and overall spillage amounts over the last decade has been industry concern over the tremendous costs associated with the response and damage assessments (natural resources and third-party damage claims) that are incurred after a spill incident. The experience of the Exxon Valdez oil spill in March 1989 and the tremendous cleanup costs, natural resource damage costs, and third-party claims associated with this notorious spill has acted as a deterrent to potential spillers. With OPA 90’s statutes allowing individual states to set their own liability limits, including the right to set unlimited liability for cleanup and damage costs, the costs of dealing with an inopportune spill are formidable, perhaps even greater than the costs of fines and penalties that may be imposed.
With OPA 90’s statutes allowing individual states to set their own liability limits, including the right to set unlimited liability for cleanup and damage costs, the costs of having to deal with an inopportune spill are formidable, perhaps even greater than the costs of fines and penalties that may be imposed.
Alabama Lead State Agency: Alabama Department of Environmental Management, Water Division Notification Requirements: Spills into surface or ground waters must be reported to the Alabama Department of Environmental Management as well as to the US Coast Guard. Financial Responsibility Requirements: None Cleanup/Damage Discharge Liability Limits: Unlimited. The responsible party is liable for any and all oil removal costs and damages resulting from an oil spill, except for any damages that result from actions taken or omitted in the course of rendering care, assistance, or advice consistent with the National Contingency Plan or as directed by the Federal On-Scene Coordinator or by any state official responsible for oil spill response. Other Liabilities: The spiller is liable for civil damages including, but not limited to, any reasonable costs to prevent, minimize, or clean up any damages resulting from oil pollution resulting from a wrongful act, omission, or negligence. Both punitive and compensatory damages may be recovered in a case where pollution resulted from willful or wanton conduct on the part of the defendant; compensatory damages alone may be awarded when the pollution is caused by a negligent act or omission. The spiller is liable © 2003 Environmental Research Consulting
for an additional amount equal to the amount of money reasonably necessary to restock such waters or replenish wildlife. If the pollution caused fish or wildlife damage in excess of US$5,000, the damage shall be presumed to be the direct result of negligence and the burden shall be on the spiller to prove absence of negligence. Criminal Penalties/Fines: The spiller who willfully or with gross negligence violates state pollution laws shall be fined not less than US$2,500 nor more than US$25,000 per day of violation or by imprisonment of not more than one year or both. A second conviction carries a fine of US$5,000-$50,000 per day or by imprisonment of one to two years or both. Knowingly making a false statement, record, report, or document, or tampering with any monitoring device or method is subject to a fine of up to US$10,000 or by up to six-month imprisonment or both. Civil Penalties/Fines: None
Alaska Lead State Agency: Alaska Department of Environmental Conservation, Office of Oil Spill Prevention and Response Notification Requirements: Spills into waters, surface, or subsurface lands must be reported to the US Coast Guard and to the Alaska Department of Environmental Conservation within 24 hours, except: if the discharge is less than one-half pint (0.5 liters) or causes a sheen, film, or discoloration affecting less than 100 ft2 (9.3 m2), it must be reported within 7 days; if the discharge is in excess of 55 gallons (208 liters/0.19 t) to water, causes a sheen, film, or discoloration of 1,000 ft2 (93 m2) or more, or causes a sludge or emulsion to be deposited beneath the water surface, it must be reported as soon as the spiller has knowledge of the discharge; if the discharge exceeds 55 gallons (208 liters/0.19 t) solely to land, it must be reported within 5 hours; if the discharge is solely to land but greater than 10 gallons (38 liters/0.034 t) and less than 55 gallons (208 liters/0.19 t), it must be reported within 24 hours of knowledge of the spill; and if the spill is 10 gallons (38 liters/0.034 t) or less and solely to the land it must be reported within 7 days of knowledge. Financial Responsibility Requirements: A tank vessel operator must have proof of financial responsibility for US$337.50 per incident per barrel [US$8.06 per gallon or US$2,363/tonne] of crude oil storage capacity or US$112,500,000, whichever is greater; and US$112.50 per incident per barrel [US$2.68 per gallon or US$788/tonne] of noncrude oil storage capacity or US$1,125,000, whichever is greater, subject to a maximum of US$39,375,000. Cleanup/Damage Discharge Liability Limits: Unlimited © 2003 Environmental Research Consulting
Other Liabilities: None Criminal Penalties/Fines: If gross negligence applies, all civil penalties (described below) are multiplied by a factor of five for all spills except for crude oil spills in which it is multiplied by a factor of four. Civil Penalties/Fines: Civil penalties are calculated on the basis of the sensitivity of the receiving environment, as well as the the toxicity, degradability, and dispersibility of the oil, as shown in Figures 2 and 3.
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Figure 2: Alaska Oil Spill Civil Penalty Schedule Environment
Freshwater US$10.00/gal US$2,940/tonne
Marine US$2.50/gal US$735/tonne
Public Land US$1.00/gal Critical US$294/tonne US$0.75/gal Very sensitive N/A N/A US$221/tonne US$5.00/gal US$2.00/gal US$0.50/gal Sensitive US$1,470/tonne US$588/tonne US$147/tonne Without significant US$1.00/gal US$1.00/gal US$0.25/gal resources US$294/tonne US$294/tonne US$74/tonne The civil penalties are multiplied by the oil property factors as per Figure 3.
Figure 3: Alaska Oil Property Penalty Modifying Factors Property Toxicity1
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Degree Highly toxic Moderately toxic Less toxic Relatively nontoxic Low degradability Moderate degradability High degradability High dispersibility Moderate dispersibility Low dispersibility
Factor 1.0 0.75 0.50 0.25 1.0 0.50 0.25 0.15 0.50 1.0
The toxicity factor is determined by a fraction whose denominator is 45 and whose numerator is the percent concentration of aromatic compounds. (The toxicity factor cannot exceed 1.0.) Highly toxic products include: jet fuels, diesel fuels, gasoline, kerosene, and heating oils. Moderately toxic products include: waste oils, lubricating oils, and non-A or non-B jet fuels. Less toxic products include bunker and residual oil fuels, crudes, asphalts, tars, and hydraulic fluids. 2 Low degradable products include: asphalt, tar, bunkers, crudes, and residual oil fuels. Moderately degradable products include: hydraulic fluids, lubricating oils, and waste oils. Highly degradable products include: gasoline, diesel fuels, heating oil, jet fuels, and kerosene. 3 Highly dispersible products include: gasoline, jet fuels, kerosene, diesel fuels, heating oils, hydraulic fluids, and turbine fuels. Moderately dispersible products include: emulsified mixtures, lubricating oils, and waste oils. Low dispersible products include: bunker and residual fuels, asphalts, tars, and crudes.
In addition to the above, civil penalties of US$500-$100,000 can be applied for any initial violation, and up to US$5,000-$10,000 per day thereafter.
California Lead State Agency: California Department of Fish and Game, Oil Spill Prevention and Response Office
As of February 2000, California’s financial responsibility requirement is US$1 billion.
Notification Requirements: Spills must be reported to the US Coast Guard and the California Department of Fish and Game, Oil Spill Prevention and Response Office. Financial Responsibility Requirements: US$1 billion Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: None Criminal Penalties/Fines: US$5,000-$50,000 per day for failing to follow state oil spill administrator’s directions, failing to notify the US Coast Guard, for causing a spill, or for failing to begin cleanup; US$2,500-$250,000 per day for failing to notify the Office of Emergency Services, operating without an approved contingency plan, failing to follow plan; other “knowing” violations, up to US$50,000. © 2003 Environmental Research Consulting
Civil Penalties/Fines: US$25,000-$500,000 per intentional or negligent day per violation if the US Coast Guard is not notified, state oil spill administrator’s orders not followed, for causing a spill, or if cleanup is not begun; up to US$250,000 per day for other violations. Administrative penalties of US$10 per gallon [US$2,940/tonne] spilled reduced by the amount recovered or up to US$100,000 per day. (This cannot be applied in addition to civil penalties.) The administrative penalty can be increased to US$30 per gallon [US$8,820/tonne] in cases of gross negligence or reckless conduct.
Connecticut Lead State Agency: Connecticut Department of Environmental Protection, Bureau of Waste Management, Oil & Chemical Spill Response Division Notification Requirements: Immediately report spill to the US Coast Guard and the Connecticut Department of Environmental Protection; submit written report within 48 hours of incident. Financial Responsibility Requirements: None Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: None Criminal Penalties/Fines: The responsible party may be liable for paying up to one and a half times the cost of cleanup (plus interest) if the damage was negligently caused and up to two and a half times the cost of cleanup (plus interest) if the damage was willfully caused. Civil Penalties/Fines: Responsible party may be fined US$5,000 or US$1,000 for an individual, for failure to report a spill to the US Coast Guard and state authorities.
Delaware Lead State Agency: Department of Natural Resources and Environmental Control, Division of Air & Hazardous Waste Notification Requirements: Immediately report all spills to the US Coast Guard and the Department of Natural Resources and Environmental Control, Division of Air & Hazardous Waste Financial Responsibility Requirements: For all vessels over 300 gross tons, US$150 per gross ton for nontank vessels; US$300 per gross ton or US$250,000, whichever is © 2003 Environmental Research Consulting
greater, up to a limit of US$30 million for tank vessels. Cleanup/Damage Discharge Liability Limits: For all vessels over 300 gross tons, US$150 per gross ton for nontank vessels; US$300 per gross ton or US$250,000, whichever is greater, up to a limit of US$30 million for tank vessels. Other Liabilities: None Criminal Penalties/Fines: None Civil Penalties/Fines: None
Florida Lead State Agency: Florida Department of Natural Resources Notification Requirements: Immediately report to the US Coast Guard and the Florida Department of Natural Resources Financial Responsibility Requirements: OPA 90 amounts (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater) Cleanup/Damage Discharge Liability Limits: OPA 90 amounts (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater) Other Liabilities: Natural resource damages shall be no less than US$1 per gallon [US$294/tonne] spilled or no greater than US$1,000 per gallon [US$294,000/tonne] spilled or equivalent unit as determined by the square footage of habitat impacted. Criminal Penalties/Fines: If the spill is due to gross negligence of willful misconduct, the spiller is liable to pay all cleanup costs and damages, regardless of extent. Civil Penalties/Fines: First offense for failure to submit a spill contingency plan makes responsible party subject to a US$5,000 fine; a second violation carries a US$10,000 penalty. Failure to have proper financial security carries a civil penalty of US$25,000. Other civil penalties of up to US$50,000 per day. Exceptions: Acts of God (unforeseeable acts exclusively occasioned by the violence of nature without the interference of any human agency), acts of government, acts of war, and acts or omissions of a third party can exempt a spiller from responsibility for damages, costs, cleanup, and abatement.
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Georgia Lead State Agency: Georgia Department of Natural Resources, Environmental Protection Division Notification Requirements: Immediately report spill to the US Coast Guard and to Georgia Department of Natural Resources, Environmental Protection Division Financial Responsibility Requirements: None Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: None Criminal Penalties/Fines: Knowingly violating any oil spill laws, causing any personal injury or property damage, or failing to comply with any court order makes the responsible party subject to criminal penalties of US$2,500-$25,000 per day or imprisonment of up to one year or both. Upon a second conviction, the criminal penalties go up to US$50,000 per day and/or imprisonment of up to two years. Civil Penalties/Fines: Knowingly violating any oil spill laws or failing to comply with any emergency order makes the responsible party subject to civil penalties of up to US$25,000 per day.
Hawaii Lead State Agency: Hawaii Department of Health, Environmental Health Administration Notification Requirements: Immediately report spills to the US Coast Guard or to the Hawaii Department of Health, Hazard Evaluation and Emergency Response Program Financial Responsibility Requirements: None Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: None Criminal Penalties/Fines: Negligence can be punished with a fine of US$2,500 to US$25,000 per day and imprisonment of up to one year or both. With a second violation this increases to up to US$50,000 per day and/or two years of imprisonment. Knowingly spilling oil carries a fine of US$5,000 to US$50,000 per day and/or imprisonment of up to three years. A second conviction carries a fine of up to US$100,000 per day and/or © 2003 Environmental Research Consulting
imprisonment of up to six years. An individual knowingly endangering another person during a spill incident shall be punished with a fine of up to US$250,000 and/or imprisonment of up to 15 years. An organization is subject to a fine of US$1,000,000]. Upon a second violation, the fine and imprisonment are doubled. False statements and reports or tampering with monitoring equipment or safety devices carries a fine of up to US$10,000 per day and/or imprisonment of two years. A second conviction doubles the fine and imprisonment. Civil Penalties/Fines: Up to US$10,000 per day with an additional US$5,000 imposed if responsible party interferes with official inspections.
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Louisiana Lead State Agency: Louisiana Office of the Oil Spill Coordinator Notification Requirements: All oil spills of one or more barrels must be reported to the US Coast Guard and the Louisiana Department of Environmental Quality. A written report must be submitted to the state in 7 days. For spills in Louisiana, Financial Responsibility Requirements: OPA private claimants can seek 90 limits (i.e., for tankers over 3,000 gross tons, up to US$10,000 per day US$1,200 per gross ton or US$10 million, from the spiller. whichever is greater). Must have federal certificate of financial responsibility (COFR). Cleanup/Damage Discharge Liability Limits: OPA 90 limits (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater) Other Liabilities: Private claimants can seek up to US$10,000 per day. Criminal Penalties/Fines: Withholding information or false representation can bring criminal penalties of US$25,000 per day. If human life is threatened, penalties of up to US$1 million or cleanup cost plus US$100,000 per day plus 10 years hard labor can be imposed. If human life not threatened, penalties of up to US$25,000 per day can be imposed.
Maine Lead State Agency: Maine Department of Environmental Protection Notification Requirements: Report spills as soon as possible, but within two hours to Maine Department of Environmental Protection, as well as to the US Coast Guard. Written report must be submitted within 10 days. In Maine, there are no fines or penalties imposed Financial Responsibility Requirements: None if the responsible party beyond federal requirements for certificate of promptly reports and financial responsibility (COFR) removes the discharge in accordance with the rules, Cleanup/Damage Discharge Liability Limits: regulations, and orders of Unlimited state officials. © 2003 Environmental Research Consulting
Other Liabilities: None Criminal Penalties/Fines: Failure to comply with official orders or providing false information can bring penalties of up to US$10,000. If the economic benefit of a violation is greater than the maximum fine, the penalty can be raised to up to twice the economic benefit. Civil Penalties/Fines: There are no fines or penalties imposed if the responsible party promptly reports and removes the discharge in accordance with the rules, regulations, and orders of state officials. Any violation of oil pollution laws can bring fines of US$100-$25,000 per day. If the economic benefit of a violation is greater than the maximum fine, the penalty can be raised to up to twice the economic benefit.
Maryland Lead State Agency: Maryland Department of the Environment, Hazardous & Solid Waste Management Administration, Oil Control Section Notification Requirements: Report spills to the Maryland Department of the Environment and to the US Coast Guard within two hours. Written report due ten days after completion of removal and cleanup work. Financial Responsibility Requirements: Must have a bond showing financial backing for US$500 [C$732] per gross ton Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: None Criminal Penalties/Fines: If the responsible party fails to comply with official orders the state may impose a fine of up to US$50,000 and/or a one-year imprisonment. Additional violations can bring fines up to US$50,000 per day and/or a two-year imprisonment. Knowingly making false statements or reports, or tampering with monitoring or safety devices can bring fines of up to US$10,000 and/or six-months imprisonment. Civil Penalties/Fines: Any violations of oil spill regulations makes the responsible party subject to a penalty of up to US$25,000, plus up to US$10,000 per day up to US$100,000. In spills of over 25,000 gallons (85 tonnes), the responsible party is subject to additional civil penalties of up to US$100 per gallon [US$29,400/tonne] spilled. © 2003 Environmental Research Consulting
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Massachusetts Lead State Agency: Massachusetts Department of Environment Quality Engineering Notification Requirements: Report spills as soon as possible to the US Coast Guard and the Massachusetts Department of Environment Quality Engineering. Financial Responsibility Requirements: None beyond federal certificate of financial responsibility (COFR) Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: None Criminal Penalties/Fines: Responsible parties are subject to fines of up to US$25,000 and/or up to two years imprisonment. Failure to promptly report a known spill is punishable by a fine of up to US$100,000 or by imprisonment in a state prison for not more than 20 years or in a jail or house of correction for up to two and one-half years or both. Civil Penalties/Fines: Violators of state pollution laws are subject to civil penalties of US$25,000. Exceptions: Acts of God (unforeseeable acts exclusively occasioned by the violence of nature without the interference of any human agency), acts of government, acts of war, and acts or omissions of a third party can exempt a spiller from responsibility for damages, costs, cleanup, and abatement.
Mississippi Lead State Agency: Mississippi Department of Natural Resources and Mississippi State Oil and Gas Board Notification Requirements: Report all spills to the US Coast Guard and to the Mississippi Department of Natural Resources. Report all spills of over 100 barrels (4,200 gallons) [14 tonnes] to the Mississippi State Oil and Gas Board Financial Responsibility Requirements: None beyond federal certificate of financial responsibility (COFR) Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: RPs that violate orders of state officials to remove oil and cause harm © 2003 Environmental Research Consulting
to fish and/or wildlife must pay all costs to restock the affected wildlife and/or fish. Criminal Penalties/Fines: None Civil Penalties/Fines: Violators of state pollution laws are subject to penalties of up to US$25,000 for each violation.
New Hampshire Lead State Agency: New Hampshire Department of Environmental Services, Water Supply & Pollution Control Division Notification Requirements: Notify the US Coast Guard and the New Hampshire Department of Environmental Service of spills of over 25 gallons [0.085 tonnes] or any spill that is not immediately contained. Financial Responsibility Requirements: None beyond federal certificate of financial responsibility (COFR) Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: Responsible party is liable for costs up to twice the costs spent by the state to investigate, remediate, and clean up the spill site if it does not comply with state orders. Criminal Penalties/Fines: None Civil Penalties/Fines: Willful discharge of oil into waters that could impact public water supplies carries a fine of up to US$10,000 per day. There is an additional administrative fine of US$2,000.
New Jersey Lead State Agency: New Jersey Department of Environmental Protection Notification Requirements: Immediately notify the US Coast Guard and the New Jersey Department of Environmental Protection Financial Responsibility Requirements: None beyond federal certificate of financial responsibility (COFR) © 2003 Environmental Research Consulting
Cleanup/Damage Discharge Liability Limits: Unlimited liability for cleanup. US$150 per gross ton of vessel for damages, except in cases of willful misconduct or gross negligence, in which case damage liability is unlimited. Other Liabilities: None Criminal Penalties/Fines: None Civil Penalties/Fines: Discharge penalties up to US$50,000 for spills of less than 100,000 gallons [340 tonnes], and penalties of up to US$10 million for spills of 100,000 gallons [340 tonnes] or more. The maximum fine for a non-corporation is the greater of US$100,000 or double the violator’s gain. For a corporation, the maximum fine is three times whatever is otherwise levied. Administrative penalty of up to US$50,000 per violation per day. Additional civil penalty of up to US$50,000 per day.
New York Lead State Agency: New York State Department of Environmental Conservation Notification Requirements: Within two hours report all spills to the US Coast Guard and the New York State Department of Environmental Conservation Financial Responsibility Requirements: OPA 90 limits (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater). Must have federal certificate of financial responsibility (COFR) Cleanup/Damage Discharge Liability Limits: OPA 90 limits (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater) Other Liabilities: None Criminal Penalties/Fines: Intentional, knowing, or reckless violation of US$2,500$25,000 per day, with second offense up to US$50,000 per day. Violation of booming requirement for transfers of over 1 million gallons [3,400 tonnes] has penalty of US$50,000. Civil Penalties/Fines: Discharge penalties of up to US$25,000 per day
North Carolina Lead State Agency: North Carolina Department of Environment, Health & Natural Resources, Division of Environmental Management © 2003 Environmental Research Consulting
Notification Requirements: Report all spills to the US Coast Guard and the North Carolina Department of Environment, Health & Natural Resources, Division of Environmental Management. Financial Responsibility Requirements: None beyond federal certificate of financial responsibility (COFR) Cleanup/Damage Discharge Liability Limits: OPA 90 amounts (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater) Other Liabilities: None Criminal Penalties/Fines: Intentionally, knowingly, or willfully discharging oil carries a criminal penalty of up to US$10,000 and/or six-month imprisonment. Civil Penalties/Fines: Intentionally or negligently spilling oil or failing to report a discharge carries a penalty of up to US$5,000.
Oregon Lead State Agency: Oregon Department of Environmental Quality Notification Requirements: Report all spills to the US Coast Guard and the Oregon Department of Environmental Quality Emergency Management Division. Financial Responsibility Requirements: Federal certificate of financial responsibility (COFR) with evidence of financial responsibility of OPA 90 amounts (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater) required Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: Willful or negligent discharge brings damage liability up to amount of damages. Criminal Penalties/Fines: None Civil Penalties/Fines: Failure to make good-faith cleanup efforts, brings penalties of up three times cleanup costs.
Pennsylvania Lead State Agency: Pennsylvania Department of Environmental Protection © 2003 Environmental Research Consulting
Notification Requirements: Report all spills to the US Coast Guard and Pennsylvania Department of Environmental Protection. Written report due to Pennsylvania Department of Environmental Protection in 15 days. Financial Responsibility Requirements: None beyond federal certificate of financial responsibility (COFR) Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: None Criminal Penalties/Fines: None Civil Penalties/Fines: Civil penalties of up to US$10,000 per day
Rhode Island Lead State Agency: Rhode Island Department of Environmental Management Notification Requirements: Report all spills to the US Coast Guard and the Rhode Island Department of Environmental Management Financial Responsibility Requirements: Federal certificate of financial responsibility (COFR) with evidence of financial responsibility of OPA 90 amounts (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater) required Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: None Criminal Penalties/Fines: Violating orders of officials or rules of oil spill laws carries a fine of up to US$25,000 and/or five years imprisonment. Each day is considered a separate offense. Knowingly making false statements or reports or tampering with monitoring devices is punishable with a fine of up to US$25,000 and/or five years imprisonment.
STATES WITH PENALTY EXEMPTIONS FOR ACTS OF GOD, WAR, GOVERNMENT, OR THIRD-PARTIES Florida Massachusetts Rhode Island South Carolina
Civil Penalties/Fines: The maximum civil penalty for oil discharge is US$25,000. Penalty is based on the amount of oil spilled, the oil type, the toxicity, degradability, and dispersal characteristics of the oil, and any mitigating action the responsible party may © 2003 Environmental Research Consulting
have taken to stop or control the discharge. Exceptions: Penalties cannot be imposed if the discharge was solely due to acts of God (unforeseeable acts exclusively occasioned by the violence of nature without the interference of any human agency), acts of government, acts of war, and acts or omissions of a third party.
South Carolina Lead State Agency: South Carolina Department of Health and Environmental Control Notification Requirements: Report all spills to the US Coast Guard and the South Carolina Department of Health and Environmental Control. Financial Responsibility Requirements: None beyond federal certificate of financial responsibility (COFR) Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: None Criminal Penalties/Fines: None Civil Penalties/Fines: Civil penalties of up to US$5,000 per day Exceptions: Acts of God (unforeseeable acts exclusively occasioned by the violence of nature without the interference of any human agency), acts of government, acts of war, acts or omissions by law enforcement officers, and acts or omissions of a third party can exempt a spiller from responsibility for damages, costs, cleanup, and abatement.
Texas Lead State Agency: Texas General Land Office (TGLO) Notification Requirements: Report all spills to the US Coast Guard and the TGLO. Financial Responsibility Requirements: OPA 90 amounts (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater) Cleanup/Damage Discharge Liability Limits: OPA 90 amounts (i.e., for tankers over 3,000 gross tons, US$1,200 per gross ton or US$10 million, whichever is greater) for natural resource damages; limits for cleanup costs and other damages of US$1 million © 2003 Environmental Research Consulting
for vessels of 300 gross tons or less that do not carry oil as cargo, US$5 million for vessels of 8,000 gross tons or less, and US$600 per gross ton for vessels greater than 8,000 gross tons. Other Liabilities: None Criminal Penalties/Fines: Failure to report a discharge carries a fine of US$500-$250,000 for an individual or US$500-$500,000 for a corporation or other entity. Failure to abate, contain, and remove oil carries a fine of up to US$25,000 per day or three times the cost incurred as a result of the spill. Any violation of pollution law carries fine of US$100-$100,000 per day up to US$125,000.
AGGRAVATING CIRCUMSTANCES THAT CAN BRING HIGHER PENALTIES IN TEXAS •
Failure of responsible party to respond to spill with appropriate resources within reasonable time frame.
Failure of responsible party to modify identified deficient procedures that contribute to subsequent spills.
• Failure of responsible party to fulfill Civil Penalties/Fines: Responsible duties in accordance with Texas Oil party is subject to fine of US$250 Spill Prevention and Response Act for spills of less than one gallon. For (OSPRA) spills over one gallon, fines of up to US$500 plus $250 per barrel • Repeat unauthorized discharges of [US$6/gallon or $1,750/tonne]. New similar nature or oil handling, storage, regulations that entered into force on or transfer process failure. 1 August 2000 encourage the implementation of Sound Management Practice (SMP) programs by stipulating lower penalties for entities with these programs in place. The minimum requirements for an SMP program include: •
A written statement dated prior to a spill from the owner/operator submitted to the Texas Land Office committing to an SMP program.
Written policies and procedures to be utilized by company personnel in the handling of oil in a location where a spill could threaten Texas coastal waters, a description of the methods or procedures, and the mechanism to conduct quality assurance of initial and refresher training. Effective August 2000, Written documentation of spill prevention the Texas General and response training including subjects preLand Office allows for sented, dates of training, and list of attendees. reduced penalties for entities with Sound Management Practice © 2003 Environmental Research Consulting programs.
A post-spill auditing process.
The penalty structure is shown in Figure 4. Additional prevention and response penalties are shown in Figure 5. The TGLO will use the matrix shown with the intention of assessing penalties at the minimum levels. Aggravating circumstances may cause the penalty to be assessed higher.
Figure 4: Texas Oil Spill Penalties (as of 1 August 2000) Spill Size
1st Spill1 2nd Spill 3rd Spill 4th Spill Sound Management Practice Program in Place
1 Gallon or Less Over 1 Gallon
$300 plus $350 plus $400 plus $450 plus $100/bbl $100/bbl $100/bbl $100/bbl [$700/t] [$700/t] [$700/t] [$700/t] No Sound Management Practice Program in Place
1 Gallon or Less
5th Spill2 $250 $500 plus $100/bbl [$700/t] $250
$350 plus $400 plus $450 plus $550 plus $550 plus $200/bbl $200/bbl $200/bbl $200/bbl $200/bbl [$1,400/t] [$1,400/t] [$1,400/t] [$1,400/t] [$1,400/t] 1 Time period of 12 months immediately preceding spill in question. 2 Figure applies to all spill greater than the fourth spill in the 12 months preceding the spill in question. Over 1 Gallon
Figure 5: Texas Oil Spill Prevention and Response Penalties Violation Category
Failure to Notify
Failure to notify the TGLO of an unauthorized discharge
Failure to cooperate with state on-scene coordinator (SOSC)
Failure to comply with orders from SOSC and failure to give written reasons for noncompliance Denying access to property
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Base Penalties $500 Penalty to be determined based on review of circumstances and mitigating factors regarding time, size, and environmental impacts of the spill
Failure to report material changes that occur prior to arrival of SOSC
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Figure 5: Texas Oil Spill Prevention and Response Penalties (cont.) Violation Category
Description Failure to immediately initiate response actions Failure to take reasonable action to abate, contain, and remove pollution Taking actions not consistent with plan or deviating from plan
Insufficient response actions
No site safety plan or plan not consistent with National Contingency Plan or Area Contingency Plan Unauthorized discharge cleanup organization (DCO)
Failure to notify adjacent property owners or local responders
Failure to inform state onscene coordinator about location for waste disposal Failure to remove waste from spill site within 14 days after cleanup complete Failure to provide documentation of waste disposal as directed
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Base Penalties $500 $1,000 Penalty to be determined based on review of circumstances and mitigating factors regarding time, size, and environmental impacts of the spill Penalty to be determined based on review of circumstances and mitigating factors regarding time, size, and environmental impacts of the spill Penalty to be determined based on review of circumstances and mitigating factors regarding time, size, and environmental impacts of the spill $500 Penalty to be determined based on review of circumstances and mitigating factors regarding time, size, and environmental impacts of the spill $100
Figure 5: Texas Oil Spill Prevention and Response Penalties (cont.) Violation Category
Failure to file completion report
$100 Assuming that reasonable requests for extensions were granted
Making a material false statement with fraudulent intent in application or report Operating a facility or vessel without required certificate of financial responsibility Operating a facility or vessel without an approved plan Removing a vessel from which a spill has emanated from jurisdiction without showing proof of financial responsibility
Criminal referral Penalty to be determined based on a review of the circumstances and mitigating factors regarding the failure to comply with regulations $1,000
Virginia Lead State Agency: Virginia Department of Environmental Quality Notification Requirements: Report all spills to the US Coast Guard and the Virginia Department of Environmental Quality. Financial Responsibility Requirements: Proof of financial responsibility of US$500 per gross ton required in addition to federal certificate of financial responsibility (COFR) Cleanup/Damage Discharge Liability Limits: Unlimited for cleanup costs Other Liabilities: Damage liability limited to US$500 per gross ton or US$10 million whichever is greater. Criminal Penalties/Fines: Knowingly violating any regulation or administrative or judicial order can result in up to one-year imprisonment and/or US$100,000 fine. False statements and reports are punishable by imprisonment of 1-3 years and/or a fine of © 2003 Environmental Research Consulting
US$100,000. Negligently discharging oil into state waters is punishable by up to oneyear imprisonment and/or a fine of US$50,000. The felony of knowingly or willfully discharging oil is punishable with imprisonment of 1-10 years and a fine of US$100,000. With the second felony conviction the imprisonment term is 2-10 years and the fine is increased to up to US$200,000 or both. Upon conviction of violation of any regulations or judicial orders, responsible party is subject to a fine of up to US$1,000,000 or an amount that is three times the economic benefit realized by the defendant as a result of the defense, whichever is greater. Civil Penalties/Fines: Failure to maintain contingency plan brings a fine of US$1,000$50,000 for the initial violation, with additional fines of US$5,000 per day thereafter. Failure to maintain evidence of financial responsibility (marine insurance broker’s certificate or protection and indemnity club membership) can be fined US$1,000$100,000 or the initial violation with an additional US$5,000 per day thereafter. For discharging oil, responsible party is subject to penalties of up to US$100 per gallon [US$29,400/tonne]. Failure to cooperate in containment and cleanup of discharge brings penalty of US$1,000-$50,000, with an additional US$10,000 per day after the initial violation.
Washington Lead State Agency: Washington Department of Ecology (DOE) Notification Requirements: Report all spills to the US Coast Guard and the Washington Department of Ecology Financial Responsibility Requirements: US$500 million for tank vessels carrying oil in bulk Cleanup/Damage Discharge Liability Limits: Unlimited Other Liabilities: Natural resource damage liability determined by a state compensation schedule of between US$1-$50 per gallon [US$294-$14,700/tonne] spilled depending on the characteristics of the oil and the sensitivity of the impacted environment. Criminal Penalties/Fines: Any willful violation of oil spill regulations or official orders is punishable with fines up to US$10,000 per day plus the cost of prosecution. Failure to maintain a contingency plan or proof of financial responsibility can be fined up to US$100,000 per day. For violations of oil spill response system, fines up to US$1,000. Civil Penalties/Fines: Negligently spilling oil is punishable by up to US$20,000 per violation per day of risk to the environment. Intentional or reckless discharge is punishable with fines of up to US$100,000 per violation per day of risk to the environ© 2003 Environmental Research Consulting
ment. In December 1999, DOE began to take companies to court for not paying fines.
© 2003 Environmental Research Consulting
US Case Studies Case Study: M/V Frances Hammer On 7 April 1993, the US-flagged bulk liquid carrier Frances Hammer (18,720 GRT) was charged with intentional illegal oil discharge on the high seas in the Atlantic Ocean, off Florida, USA. An estimated 60,000 gallons [204 tonnes] of oily waste (slop) were spilled. No impacts on shorelines or wildlife, or any other property or natural resource damage were reported in connection with this incident. No response took place due to location at sea and the failure of the vessel operators to report the spill. According to US Coast Guard inIn December 1997, the US vestigators, the M/V Frances Hammer prosecuted its first successful flagleft the Port of Hamburg, Germany, on state MARPOL enforcement for a 30 March 1993 after inquiring about a discharge that occurred in the reception facility for port disposal of high seas. oily wastes from the slop tank. The captain was advised by Hamburg port authorities that the pumping could not take place for several days. To avoid delay, the vessel left and later disposed of the waste enroute to Tampa, Florida, USA. The US Coast Guard determined from an inspection and oil log books that an illegal discharge had taken place. In December 1997, the US attorney for the Middle District of Florida sentenced the owner/operator to paying a fine of US$50,000 and two years probation. The company was also ordered to pay US$200,000 in restitution for harming the environment (by oil input into the sea) and to issue a public apology. The captain also pleaded guilty to the same charges and faced a maximum of five years in prison and a US$250,000 fine. The captain also agreed to a 24-month suspension of his license and documents. The chief mate agreed to pay a US$5,000 fine, surrender his license and documents for one year, and to apologize to the US Coast Guard. This was the first federal prosecution in the US involving the known discharge of oily waste in international waters in violation of the Act to Prevent Pollution From Ships, i.e., the first successful flag-state MARPOL enforcement in the high seas, by the US. Case Study: M/V Command Oil Spill On 27 September 1998, the T/V Command (61,000 DWT) discharged 51,000 gallons [175 tonnes] of No. 6 fuel (Bunker C) from its bunker tanks in the Pacific Ocean, off San Francisco, California, USA (37.45N;122.26W), according to a US Coast Guard investigation which exactly matched collected oil with the bunkers on the tanker. The discharge created a 24-km oil slick. Later, tarballs washed up on 24 km of beaches. Over © 2003 Environmental Research Consulting
180 birds, including brown pelicans, an endangered species, were killed as a result of oiling. The spill also affected two national marine sanctuaries, the Gulf of Farallones National Marine Sanctuary and the Monterey Bay National Marine Sanctuary. The spill was discovered after the tanker had left the area. After the spill, the US Coast Guard located and boarded the tanker on the high seas with the permission of Liberia, the flag state, and later inspected the ship in port in Panama with the permission of the Panamanian government. It was the first time a ship was ever intercepted on the high seas for suspicion of pollution charges.
In September 1998, for the first time, US Coast Guard officials intercepted a tanker on the high seas for suspicion of pollution charges. One year later, a judge sentenced the tanker owner to pay over US$9.4 million in criminal and civil penalties.
The owners of the Command, Anax International Agencies of Greece, denied that the vessel was the source of the oil and planned to fight any criminal charges brought by the US Department of Justice. In November 1998, a US grand jury indicted the tanker owner, captain, and chief engineer. If convicted, the tanker owner faced US$1.5 million in fines and five years of probation of their operations. The captain and engineer each faced US$750,000 in fines and 13 years in prison. The defendants were indicted by the federal grand jury in San Francisco on 2 December 1998. Exactly one year after the spill, on 27 September 1999, the tanker owners pleaded guilty in US federal court to criminal charges stemming from the Command incident. According to the US Department of Justice, during the plea agreement, the defendants admitted the following: The fuel tank of the Command was damaged during a trip to Central America in September 1998. After some repairs were made, the Command traveled to Ecuador, where it took on a cargo of crude oil bound for the Tosco Refinery at the Richmond Long Wharf in the San Francisco Bay, USA. The ship arrived in San Francisco on 22 September and discharged its oil. On 24 September 1998, as the ship was being refueled for its next voyage, oil began to leak into the Bay from a crack in the damaged tank. Refueling was stopped and the US Coast Guard was notified, as required by law. After inspecting the Command, the US Coast Guard directed that repairs be made before the ship could leave port. In order to get the ship repaired as quickly as possible, and after consulting with representatives of Anax [the tanker owner], the captain, Dimitrios Georgantas, ordered that all fuel be removed from the damaged tank, and placed into all other available fuel tanks. Those tanks all were quickly filled, however, and more than 200 tonnes of fuel remained in the damaged tank. The captain directed that the © 2003 Environmental Research Consulting
remaining fuel from the damaged tank be transferred to a clean slop tank, and the temporary repairs were made. After a US Coast Guard inspection, the ship was permitted to sail, with an order of the captain of the port that it not use the damaged tank until more permanent repairs could be made. During the evening of 26 September 1998, the ship left San Francisco, heading south toward Ecuador. Once the ship set sail, the captain ordered a crew member to transfer the fuel from the slop tank back In announcing the guilty verdicts, into the temporarily repaired starboard the US attorney said, “The coasts fuel tank, in violation of the US Coast of California are a precious Guard’s orders. The re-transfer procedure resource. Those who criminally required constructing an on-deck bypass pollute that resource will be system using hoses and a powerful pump. prosecuted criminally. Would-be During the transfer operation, one of the polluters should be on notice that hoses came unfastened and oil rapidly we can and will use the powers of began spilling onto the deck of the ship the US government, the California and into the Pacific Ocean. When the state government, and local captain was told of the spill, he failed to governments to prosecute notify the US Coast Guard as required by environmental crimes.” law. According to the Anax plea agreement, the captain also instructed crew members to deny that any oil spill had occurred. In their pleas, the tanker owner and the captain admitted that the Command negligently spilled oil into the ocean and then failed to report the spill to authorities. The judge sentenced the tanker owner to pay US$9,413,213 in criminal and civil penalties. The ship’s captain was also sentenced to probation and was prohibited from being on any ship in a US port for the next three years. The chief engineer had been placed on pretrial diversion for a period of 18 months during which he was prohibited from working on any ship that sails into a US port. In announcing the guilty verdicts, the US attorney said, “The coasts of California are a precious resource. Those who criminally pollute that resource will be prosecuted criminally. Would-be polluters should be on notice that we can and will use the powers of the US government, California state government, and local governments to find and prosecute environmental crimes.” The state attorney said, “This remarkable settlement of criminal charges – coming a year to a day of the oil spill – provides more than US$5 million for state and federal projects to restore and enhance coastal resources, as well as holds the tanker company and ship’s captain accountable. The case is a great example of modern-day sleuthing of oil spills – and the cooperation among federal, state, and local agencies in protecting our valuable coastal resources from pollution.” © 2003 Environmental Research Consulting
The US Environmental Protection Agency administrator for enforcement and compliance assurance said, “We will vigorously pursue and prosecute those who intentionally release oil into our coastal water. This case demonstrates our resolve to find who is responsible for polluting our beaches and killing our wildlife and make them pay significant penalties when they are brought to justice.” The message is clear, if you spill oil and don’t take responsibility, the US Coast Guard will use all available resources to find the spiller and hold you accountable.
The US Coast Guard captain said “The response to the oil spill and subsequent investigation serve as a model of interagency cooperation at the federal, state, and local level. The message is clear, if you spill oil and don’t take responsibility, the US Coast Guard will use all available resources to find the spiller and hold you accountable.”
Anax’s payment includes restitution, criminal fines and penalties, and damages for unlawful conduct in connection with both the San Francisco Bay spill on 24 September 1998 and the Pacific Ocean spill on 26-27 September 1998, including violations of the Negligent Discharge of Oil, Endangered Species Act, National Marine Sanctuaries Act, Violation of Captain of the Port Order, and False Statements. The US Coast Guard will be reimbursed US$1,231,738 for the costs of cleanup and investigation, US$2,463,475 will go toward the Oil Spill Liability Trust Fund (the national oil pollution cleanup fund) as a criminal fine, and more than US$5.5 million will go to the state of California and to the federal government to enhance and rehabilitate natural resources affected by the spill. Another US$200,000 will go to the Endangered Species Reward Fund. Case Study: Royal Caribbean Cruise Lines On 24 February 1999, a federal grand jury in Los Angeles, California, USA, indicted Royal Caribbean Cruise Lines (RCCL) on three counts of falsifying oil record books of the Nordic Prince, a 192-m liner running between Los Angeles and Miami, Florida, USA, during 1994. Conviction on each count cost RCCL US$500,000. The jury based the amount of the fines on double the Royal Caribbean Cruise Lines amount of gross monetary gain from each agreed to pay US$18 million in fines violation. Dumping reportedly saved the and plead guilty to 21 US pollution company hundreds of thousands of felonies for systematically and dollars, and it paid bonuses to ship covertly dumping oil and hazardous engineers for cutting costs. waste at sea from passenger ships. The penalty, a record for pollution by On 22 March 1999, RCCL pleaded a cruise line, involves offenses from guilty to the federal pollution crimes. eight ships operating from six US Sentencing was set for July. The fines in ports. the Nordic Prince case were levied in addition to a US$9 million fine paid in the © 2003 Environmental Research Consulting
previous year on charges stemming from illegal oil dumping that occurred in San Juan, Puerto Rico, and Miami, Florida, USA. On 21 July 1999, RCCL agreed to pay US$18 million in fines and plead guilty to 21 US pollution felonies for systematically and covertly dumping oil and hazardous waste at sea from passenger ships. The penalty, a record for pollution by a cruise line, involves offenses from eight ships operating from six US ports. The counts included violations of OPA 90, the Resource Conservation and Recovery Act (RCRA) and the Clean Water Act, as well as falsifying information to the US Coast Guard through doctored oil record books and false statements. All offenses occurred after RCCL knew that it was under investigation for pollution violations in 1994, and one violation continued through 1998. [Two RCCL engineers indicted by a federal grand jury in San Juan, Puerto Rico, USA, are fugitives.] The charges to which RCCL plead guilty include: •
Anchorage, Alaska, USA: Four OPA 90 violation for “deliberate and routine midnight dumping” of waste oil into Alaska’s Inside Passage and other waters from the liners Nordic Prince and Sun Viking in 1995, and two felony counts for falsifying oil record books on the two ships.
Juneau, Alaska, USA: Violation of the Clean Water Act for dumping photographic and dry cleaning waste into the port of Juneau and Alaskan coastal waters, from the Legend of the Seas, the Nordic Prince, and the Sun Viking. Total fines for Alaskan offenses: US$6.5 million.
Miami, Florida, USA: One felony count for falsifying the oil record book of the Grandeur of the Seas in 1997, one violation of RCRA for storing ignitable waste on a pier without a permit from 1997 to 1998, and two felony violations of the Clean Water Act for dumping hazardous waste at sea and in the port of Miami in 1994 and 1995. Fine: US$3 million.
New York, New York, USA: Two felony counts for false oil record books on the Song of America in 1994, and two felony counts for dumping photo and dry cleaning waste into the port of New York and other coastal waters. Fine: US$3 million.
Los Angeles, California, USA: Three felonies for false statements and a false oil record book aboard the Nordic Prince in 1994. Fine: US$3 million.
St. Croix, US Virgin Islands: Felony violation of the Clean Water Act for dumping photo and dry cleaning waste into the Port of St. Croix and coastal waters, and one felony count for a falsified oil record book aboard the Grandeur of the Seas in 1997. Fine: US$1.5 million.
© 2003 Environmental Research Consulting
San Juan, Puerto Rico, USA: One felony for falsifying the oil record book of the Song of Norway in 1994. Fine: US$1 million.
© 2003 Environmental Research Consulting
• Case Study: Holland America Lines In June 1999, Holland America Lines (HAL) paid the US Coast Guard a fine of US$250 after admitting that its cruise ship Noordam spilled 19 liters of diesel fuel into the harbor at Juneau, Alaska, USA, on 24 May 1999. The ship’s officers blamed the a fuel line leak in a lifeboat flushed through scuppers by heavy rain for sheen reported by harbor officials. The Noordam crew mopped up some fuel with sorbents, but wind and tide dispersed most of it. HAL was already on federal probation after pleading guilty in 1998 to deliberate oil pollution of Alaskan waters by its former flagship Rotterdam in 1994, for which it paid a US$2 million penalty. Case Study: Barge RTC-320 On 15 May 1997, the tank barge RTC-320 spilled 50,000 gallons [170 tonnes] of No. 2 fuel oil into the Arthur Kill waterway, in New York, USA, causing shoreline oiling. The spill occurred when the tankerman failed to personally monitor fuel loading operations and instead went below deck and consumed alcohol. On 29 March 2000, the seaman was sentenced to one year in prison for negligently causing the spill. The seaman was also ordered to pay a fine of US$2,000. The US District Court had determined that he was not capable of repaying the US$564,962 in cleanup costs. Case Study: Delmarva Power & Light Company In June 2000, the Delmarva Power & Light Company in Delaware, USA, agreed to pay US$350,000 after having discharged an estimated 600,000 gallons [2,040 tonnes] of oil from its power plant into the Indian River over the course of 10 years. The Indian River feeds three saltwater bays which empty into the Atlantic Ocean. Although no specific environmental damages were attributed to the spill, the Delaware Department of Natural Resources and Environmental Control [DNREC] was concerned that the oil had contaminated a biologically-rich area, habitat of many birds and other wildlife, as well as major fisheries. The specific charges included: 1.) discharge of pollutants into the river and its tributaries without a permit; 2.) undertaking an activity in a manner that can cause or contribute to the discharge of a pollutant into surface water or groundwater; and 3.) failure to take timely steps to prevent, remove, and/or respond to the release of a pollutant. The Delmarva Power & Light Company was additionally liable for paying cleanup costs, which reached US$1.2 million, as well as the US$11,560 spent by DNREC investigating and responding to the spill. © 2003 Environmental Research Consulting
Case Study: M/V Anadyr On 1 January 1998, the Russian container ship Anadyr spilled 7,500 gallons [25 tonnes] of heavy fuel oil into the Sitcum Waterway while bunkering at the Port of Tacoma, Washington, USA. Investigators from the Washington Department of Ecology (DOE) determined that vessel crewmembers had violated 13 state bunkering rules and allowed two fuel tanks to overflow when they failed to predict how fast the fuel tanks were filling. In May 1998, the DOE fined the vessel and its owner, Far Eastern Shipping Co. (FESCO) of Vladivostock, Russia, US$182,000 for the spill. This was the state’s second largest oil spill fine to date. The spill was the first bunkering-related incident involving 1,000 gallons [3.4 tonnes] since the state adopted its tough new fueling-operation standards in 1994. In addition, the state Attorney General’s Office issued a US$93,872 claim for environmental damages. FESCO vessels had been involved in two other smaller spills in the previous three years. In 1995, state environmental officials ordered FESCO to comply with state bunkering rules and procedures after vessel inspectors found numerous safety and spillprevention violations aboard seven different company ships. FESCO was fined US$6,500 for violating the order in 1996. In addition, the M/V Anadyr was involved in another smaller oil spill while bunkering at the Port of Tacoma. As a result of its history and in conjunction with the January 1998 incident involving the Anadyr, the DOE issued an additional administrative order that FESCO give 24hour notice and receive approval from DOE before undertaking bunkering operations in state waters. In addition, FESCO vessels were ordered to bunker during daylight hours only. The administrative order was effective for one year. Case Study: Chevron Pipeline On 14 May 1996, an 8-inch [20-cm] pipeline at a shoreline Chevron Pipeline facility in Pearl Harbor, Honolulu, Hawaii, USA, ruptured spilling 41,000 gallons [140 tonnes] of No. 6 fuel oil into Waiau Stream. The oil spread into the harbor, oiling Ford Island, Hotel Piers, and Aiea Bay. The Arizona Memorial to servicemen killed in the December 1941 attack on Pearl Harbor was among the facilities oiled in the spill. In May 1999, the state of Hawaii sentenced Chevron to a US$100,000 fine. In addition, Chevron agreed to pay more than US$3 million in restoration costs (US$1.5 million to repair the memorial and US$1 million toward ecological restoration). © 2003 Environmental Research Consulting
Canada In Canada, oil pollution crimes are prosecuted The passage of several under the Canadian Environmental Protection amendments to the Canadian Act (CEPA), the Fisheries Act (FA) (for Shipping Act in 1995 gave discharges into waters containing fish), and the Canadian authorities greater Canadian Shipping Act. Under all three laws, power in prosecuting oil the maximum fine for minor offenses or pollution from ships. “summary convictions” is Can$250,000 [US$168,175] and/or six months in prison. Major indictable offenses carry maximum penalties of Can$1 million [US$672,700] and/or three years in prison. Offenses under the Migratory Bird Act (MBA) for discharges into waters frequented by migratory birds, carry fines of up to Can$520,000 [US$350,000]. If prosecutors exercise the option to try a case without a jury, fines are limited to Can$250,000 [US$168,175]. Examples of prosecutions under the Canadian Environmental Protection Act and Fisheries Act are shown in Figure 6.
Figure 6: Oil Spill Prosecutions Under Canadian Environmental Protection Act and Fisheries Act Date
23 Mar 1988
Shell Products Canada
24 Jun 1988
Shell Product Canada
14 Jun 1988
Melville Oil Products
16 Feb 1989
Shell Canada Refinery
9 Mar 1991
Petro-Canada Alert Bay Marine
Offense Penalty Jet fuel spill Vancouver, from bulk British storage to water Can$5,000 [US$3,364] Columbia containing fish (FA) Goose Bay, Spills to water Can$15,000[US$10,091] Labrador, containing fish (Can$5,000/count) Newfoundland (3 counts) (FA) [US$3,364/count] Goose Bay, Spills to water Labrador, containing fish Can$2,000 [US$1,345] Newfoundland (FA) Spills to water Two counts withdrawn Montreal, containing fish Can$27,000 Quebec (3 counts) (FA) [US$18,163] 70,000 ltrs (63 Marine Bay, t) partially Can$65,000 British refined crude [US$43,726] Columbia spilled into inlet (FA)
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Figure 6: Oil Spill Prosecutions (cont.) Date
30 May 1991
Burrard Inlet, British Columiba
23 Jul 1993
Mill & Timber Products
Surrey, British Columbia
Spill of diesel fuel into river
Can$500 [US$336] plus Can$3,500 [US$2,354] penalty
15 Jan 1993
Ultramar Canada, et al.
Valleyfield, Nova Scotia
6,500-8,200 ltrs (5.8-7.4 t) diesel leak at fuel plant
Can$9,000 [US$6,054] Total fines (3 parties)
31 Jan 1993
Westminster Marine Svcs.
New Westminster, British Columbia
Oil discharged from barge (3 counts) (FA)
1 Jan 1994
Consolidated Aviation Svcs./Transpor t Canada
Lester Pearson Airport, Toronto, Ontario
Spills of jet fuel to water containing fish (9 counts) (FA)
25 Apr 1994
Bay Bulls Harbour, Newfoundland
200 gallons (0.7 t) furnace oil spilled Spilled 7,100 ltrs (6.4 t) unleaded gasoline from storage tank
28 Jan 1997
Irving Oil Ltd.
Greenwood, Nova Scotia
Offense 1,117,600 ltrs (1,004 t) spilled at bulk facility (FA)
Penalty Can$15,000 [US$10,091] Can$800 [US$538]
Can$7,500 [US$5,045] Fine reduced from Can$75,000 [US$50,450] due to bankruptcy Consolidated Aviation: Can$10,000 [US$6,727] plus court order Can$40,000 [US$26,908] Transport Canada: Can$2 [US$1.35] fine plus court order Can$140,000 [US$94,178] Can$500 [US$336] Irving Oil: Can$25,000 [US$16,818] Responsible person: Can$1,500 [US$1,009]
Prosecutions Under Canadian Shipping Act The passage of several amendments to the Canadian Shipping Act in 1995 gave Canadian authorities (Canadian Coast Guard, Environment Canada, and Transport Canada) greater power in prosecuting oil pollution from ships. As with the CEPA and © 2003 Environmental Research Consulting
the FA, the maximum fine for minor offenses or “summary convictions” is Can$250,000 [US$168,175] and/or six months in prison. Major indictable offenses carry maximum penalties of Can$1 million [US$672,700] and/or three years in prison. Transport Canada has the authority to investigate incidents and recommend prosecution if warranted. In 1997,Canada stepped up its aerial and surface-based surveillance programs in the Atlantic region after a rash of spills from passing tankers and other vessels resulted in the oiling of migratory birds and their habitats. Transport Canada, the Canadian Coast Guard, Environment Canada, Justice Canada, and the Department of National Defence currently cooperate in the Protection of Oiled Wildlife (POW) program, which led to 119 investigations during 1999. In December 1999, contending that “fines must be large enough to deter pollution,” a Canadian judge imposed a record fine on the operator of a ship caught by aerial surveillance without chemical analysis of oil samples.
In December 1999, contending that “fines must be large enough to deter pollution,” a provincial court judge in Halifax, Nova Scotia, Canada, imposed a record fine of Can$40,000 [US$26,746] on the operator of the Bahamian-flagged tanker Nordholt (39,777 DWT). A Transport Canada pollution surveillance pilot had spotted the tanker trailing a 11-km slick off Nova Scotia on 29 March 1998. It was the largest fine ever imposed for a ship caught by aerial surveillance without chemical analysis of oil samples. The tanker owner’s lawyers had argued unsuccessfully for a Can$10,000 [US$6,816] which they claimed was supported by previous Canadian court decisions. The same vessel was spotted again in February 1999 off Nova Scotia having spilled an estimated 15 liters (4 gallons) of oil. The Canadian authorities fined the owner Can$35,000 [US$23,400] for the second offense. This case and other recent prosecutions against vessels are shown in Figure 7.
Figure 7: Recent Prosecution Cases Against Vessels in Canada Date
S of St. John’s, NF
19 Nov 1997
M/V Atlantic Cartier
139 km SE Cape Race, NF
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Offense 109-km slick suspected of killing migratory birds (MBA) 15-km oil slick in territorial waters; 8 offenses under FA and MBA; failure to report spill under CSA
Penalty Up to Can$520,300 [US$350,000] Defendants acquitted Can$1,061,400 [US$714,000] (MBA) Charges dropped Total fines: Can$24,340 [US$16,373] 55
Figure 7: Recent Prosecution Cases Against Vessels in Canada (cont.) Date
16 Feb 1998
110 km S Cape St. Mary’s Ecological Reserve, NF
11.6 km x 100 m slick in territorial waters (9 offenses under FA, MBA, CSA)
M/V Pine Islands
Oil discharges during 18-month anchorage
29 Mar 1998
Off Halifax, NS
11-km oil slick
7 Oct 1998
Bay Roberts, NF
100-ltr spill and tampering with oil alarms/detectors
25 Sep 1998
32 km S NF
37 liters spilled
14 Apr 1999
2,000 ltrs (520 gallons] [1.8 t] spilled
30 Apr 1999 1 Oct 1999 10 Nov 1999 22 Jun 1999 13 Mar 1999 28 May 1999 8 Feb 1999 21 Jun 1999 4 Jan 2000
Geco Sigma Riverton Solborg Ocean Castle
Halifax Harbour, NS Sable Island oil field, NS Roberts Harbour, NF Harbour Grace, NF
15-liter spill 155-liter spill 50-liter spill 100-liter spill
250 km off NS
Halifax Harbour, NS
345 km off NS
Harbour Grace, NF
F/V Chokyu Maru
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Penalty Liable for: Can$1,025,717 [US$690,000] Fine reduced to Can$36,000 [US$24,154] Can$12,000 [US$8,100] Fine reduced to Can$239,000 [US$161,000] Can$40,000 [US$26,746]
Can$5,000 [US$3,343] Can$5,000 [US$3,343] Can$7,500 [US$5,014] Can$10,000 [US$6,686] Can$20,000 [US$13,371] Can$5,000 [US$3,343] Can$35,000 [US$23,400] Can$6,000 [US$4,011] Can$10,000 [US$6,686] 56
Mexico The Mexican Federal Oceans Law, which deals with national sovereignty and boundary rights, stipulates that the prevention, reduction, and control of marine pollution be regulated under the General Law of Ecological Balance and Environmental Protection (known as the Ecology Law), the National Waters Law, the General Health Law, the Ocean Dumping Law, and their implementing regulations. The Navigation Law prohibits vessels from discharging petroleum and petroleum byproducts, wastewater, and other hazardous or noxious substances that could contaminate waters under Mexican jurisdiction. These laws complement the Coastal Zone Regulation, which covers pollution unrelated to maritime facilities and ports. Incidents are subject to Violations under the Coastal Zone Regulation carry fines fines of 20 to ranging from 50 to 500 times the minimum daily wage in the 20,000 times Federal District, depending on the severity and circumstances of the violation. Authorities can impose an additional penalty of 500 the minimum daily wage in times the minimum daily wage for recurring pollution violations. Mexico. Marine pollution incidents that violate the pollution control measures of the Ecology Law are subject to fines ranging from 20 to 20,000 times the minimum daily wage in the Federal District on the day of the violation. Under the National Waters Law, unauthorized wastewater discharges into the ocean are punishable by fines of 100 to 10,000 times the minimum daily wage in the area in which the violation occurs. Violations of Ocean Dumping Law regulations can incur the following penalties: • • • • •
Fines of 300 to 1,300 Pesos [US$33 to US$143] for unauthorized dumping of Annex I substances; Fines of 100 to 600 Pesos [US$11 to US$66] for unauthorized dumping of Annex II substances; Fines of 100 to 600 Pesos [US$11 to US$66] for unauthorized dumping of substances not listed in Annex I or Annex II but pose a contamination hazard; Fines of 300 to 750 Pesos [US$33 to US$83] for vessel or platform abandonment; and Fines of up to 750 Pesos [US$83] in addition to all civil penalties where a vessel owner or operator dumps wastes under emergency conditions [as permitted by law] but fails to report the dumping to the Secretariat of the Environment, Natural Resources, and Fisheries [SEMARNAP].
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Oil Spill Penalties in Latin America Panama According to Panamanian national law, the Maritime Authority of Panama can fine oil polluters a maximum of 200,000 Panamanian Balboas [US$197,720]. Case Study: Atlantic Pacific, S.A.
Panamanian authorities imposed the maximum fine on a company that did not report a spill for three days and then misreported the spill amount.
On 5 February 1999, the refueling company, Atlantic Pacific, S.A., spilled an estimated 140-200 tonnes (41,160-58,800 gallons) of No. 145 fuel oil into the creek Brazos Brooks when a worker negligently overfilled a fuel tank, but did not report the spill for three days. The company also initially reported the spill as being 70 tonnes (20,580 gallons) of oil, of which they claimed to have recovered 70%. The oil spill cleanup response took 40 days.
In April 1999, the Maritime Authority of Panama fined the company the maximum 200,000 Panamanian Balboas [US$197,720] penalty.
Chile In Chile, the Navigation Act of 1978 covers issues relating to oil spill fines and penalties. The law covers vessels of any registry in Chilean waters and Chilean vessels even when they are not in national waters and thus under the jurisdiction of another nation’s laws. According to the Navigation Act, the Maritime Directorate can impose administrative fines of up to 1 million gold Pesos [US$1,860] for most pollution violations. In the case of violators of the London Dumping Convention, imposed fines may be up to 5 million gold Pesos [US$9,300]. The fines are commensurate with the amount of oil illegally dumped and other circumstances aggravating or extenuating the effects of events. The fines can be repeated for subsequent events. The fines are applicable to Chilean vessels that spill oil in other jurisdictions when no punishment is exacted by the © 2003 Environmental Research Consulting
other jurisdictions’ authorities.
Brazil In Brazil, state environmental agency authorities can impose fines for oil pollution in marine waters up to a maximum of 50 million Brazilian Reals [US$28 million]. In addition, the federal government can impose further fines. The authority of the federal government and state environmental agencies to The authority of Brazilian impose fines and other criminal penalties against federal government and polluters was greatly strengthened with the state environmental adoption of a provisional act with binding powers agencies to impose fines in February 1998. and other criminal penalties against polluters was Case Study: Petrobras Pipeline Spill strengthened in 1998. The new potency was demonOn 19 January 2000, an underwater Petroleos strated with the imposition Brasileros (Petrobas) pipeline spilled 1,150 tonnes of over US$100 million in (338,000 gallons) of oil into Guanabara Bay, fines for a July 2000 Brazil, impacting beaches, marshlands, and refinery spill. mangroves in what was called the bay’s “worst ecological disaster” in 25 years. The Rio de Janeiro state government imposed the maximum fine of 50 million Brazilian Reals [US$28 million] on Petrobas. Case Study: Petrobras Tanker Spill On 26 June 2000, a Petrobas tanker leaked 0.34 tonnes (100 gallons) of crude oil into Guanabara Bay. The incident occurred while crew members were flushing the tanker’s hold, a practice illegal in Brazil. The state government fined Petrobas 500,000 Brazilian Reals [US$280,000]. Case Study: Petrobras Refinery Spill On 16 July 2000, a pipeline at a Petrobras refinery in Parana, Brazil, spilled over 3,400 tonnes (1 million gallons) of crude oil into the Barigue River. The spill impacted drinking water supplies for several cities along the river. Within days, the Parana state environmental agency imposed the maximum fine of 50 million Brazilian Reals [US$28 million]. In addition, on 24 July 2000, the federal government imposed an additional fine of 150 million Brazilian Reals [US$84 million]. The fines were due within one © 2003 Environmental Research Consulting
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Venezuela In 1992, Venezuela enacted the Penal Law of the Environment, which defines environmental offenses, including oil pollution, and authorizes the government to impose fines of up to 17,150,000 Venezuelan Bolivars [US$25,000], imprisonment, and other penalties on violators. The penalties include prison, fines, and community work. Case Study: T/V Nissos Amorgos In February 1997, the Greek-flagged tanker Nissos Amorgos (50,563 GRT, 89,000 DWT) grounded on a submerged object in the Gulf of Venezuela, near San Carlos Island, at the mouth of Lake Maracaibo, Venezuela. The tanker ruptured its hull and spilled 3,400 tonnes (1 million gallons) of crude oil and then spilled an additional 5,170 tonnes (1.52 million gallons) while being towed to an anchorage spot 30 km off the Paraguana coast. The oil impacted 75 km of shoreline, including several mangroves. The tourist and fishing industries were impacted. Venezuelan officials detained the Venezuelan officials detained the shipshipmaster and tanker involved in master and tanker for five months awaiting a grounding-related oil spill for an “unconditional” security guarantee of over one year despite the fact that 27,440,000,000 Venezuelan Bolivars there was evidence that the [US$40 million] and 4.1 billion Venezuelan shipmaster did not have proper Bolivars [US$6 million] in legal expenses information on uncharted objects that met the approval of the court. The and shipping channel depth. shipmaster was detained for over a year awaiting trial. He was fined 17,150,000 Venezuelan Bolivars [US$25,000] and sentenced to 16 months in prison in May 2000. The case was under appeal as of July 2000 on the basis of evidence that the channel at the time of the incident contained uncharted submerged objects and that the master was not provided proper information on the channel’s condition and depth. The case was cited by the International Association of Independent Tanker Owners (INTERTANKO) as an example of unreasonable detention for the master.
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Oil Spill Penalties in Europe and the Russian Federation In the European Union, the public prosecutor has the authority to impose fines and penalties, but, in most cases, the polluter and prosecutor settle the case. Only in situations in which the polluter does not accept the fines or offer an appropriate settlement does the case go to court under penal law. The guidelines used by prosecutors in determining the fines and penalties are generally set by national legislation related to MARPOL 73/78 implementation. Relevant factors generally include: the amount of oil spilled, the resulting damages, and the profit FACTORS USED BY EU gained by the polluter. Many nations follow the PROSECUTORS IN guidelines of regional pollution conventions, such SETTING PENALTIES as the Helsinki Convention for Baltic nations, in Amount of oil spilled setting fines and penalties. Resulting damages Profit gained by polluter
Netherlands Case Study: T/V World Prophet In May 1999, the Dutch government finally finished a protracted settlement case with the Greek owners of the tanker World Prophet, accused of spilling oil in the North Sea in March 1993. The 30-km oil “mystery slick “ was investigated by Dutch officials who fingerprinted the oil and traced it to the World Prophet. Six years later, in court, the owners agreed to pay a settlement of 181,050 Dutch Guilders [US$87,034]. It was the nation’s first effort to recover cleanup costs from a spiller. The tanker owners, Balham Shipping Company, settled without admitting guilt in the case. By Dutch law, the company could have faced a maximum 296,266 Dutch Guilders [US$142,418] fine. In the final settlement, Balham Shipping Company paid an additional 28,804 Dutch Guilders [US$13,846] over the 152,248 Dutch Guilders [US$73,190] fine, which amounts to about 4% interest.
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Greece In accordance with Greek national legislation, polluters face criminal, administrative and disciplinary consequences. In addition, the “polluter pays principle” is applied to all costs resulting from oil pollution damages. Administrative Fines The Minister of Mercantile Marine has the authority to impose fines of up to 5,000,000 Greek Drachmas [US$16,145]. The ministry can impose a fine of up to 250,000,000 Greek Drachmas [US$807,240] in the case of a very serious marine pollution incident. During 1998, Greek authorities imposed pollution sentences In the case of marine pollution caused by on 200 ships and 141 offshore onshore installations, a similar fine of up to installations. 10,000,000 Greek Drachmas [US$32,290] can be imposed by the prefecture. In addition, the Minister of Environment, Physical Planning, and Public Works and by other competent ministries can jointly impose a further fine of up to 100,000,000 Greek Drachmas [US$322,896] in offshore pollution cases.
Figure 8: Administrative Fines/Sentences Imposed on Ships and Onshore Installations in Greece During 1998 Number of sentences 200 to ships Number of sentences 141 to onshore installations and other sources Total amount of fines 203,573,216 Greek Drachmas to ships [US$657,330] Average fine 1,017,866 Greek Drachmas per ship [US$3,287] Total amount of fines 77,260,000 Greek Drachmas to onshore installations and other sources [US$249,469] Average fine 547,943 Greek Drachmas per installation or other source [US$1,769] Source: Greek Ministry of Mercantile Marine, Marine Environment Protection Division
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Disciplinary Penalties Greek seamen responsible for marine pollution are tried before the Disciplinary Tribunal of Merchant Marine and, if found guilty, face punishments ranging from temporary suspension to permanent disqualification and discharge. The Greek Ministry of Mercantile Marine reports that fines and penalties imposed on oil polluters have significantly reduced the amount of oil spillage and number of spills in recent years and have made vessel owners/operators and facility operators more careful in transporting and handling oil.
Any person found guilty of spilling oil by the Greek Criminal Court is punished with imprisonment from 10 days to 5 years.
Criminal Consequences Any person found guilty of spilling oil by the competent Greek Criminal Court is punished with imprisonment from 10 days to 5 years. Prison sentences are based on the amount of oil spilled, whether there was negligence involved in causing the incident, and the environmental and/or property damages involved. Case Study: T/V LaGuardia On 1 October 1994, the Italian-flagged tanker LaGuardia (49,964 DWT; 28,645 GT) rammed into supply pipes at the Aspropyrgos Hellenic Refinery, 20 km southwest of Athens, Greece, while maneuvering out of a dock after unloading crude oil. A spillage of 401 tonnes (117,890 gallons) of heavy crude oil resulted. While the refinery installations and port In Greece, prison terms for area were heavily impacted, environmental damage oil pollution offenses can was minimal due to the heavily industrialized nature be “bought off” for 200,000 of the port. Drachmas [US$646] per month. Investigators determined that the accident was due to “human error caused by bad communication.” Four days after the accident, a Greek court sentenced the Greek pilot and Italian tanker captain to 32 months in prison and 1,302,668 Greek Drachmas [US$4,207] in fines on three counts of violating antipollution laws. The court charged the tanker captain and pilot with criminal negligence, violation of laws on marine safety, and violation of laws dealing with marine accidents. The captain paid his fine and “bought off” his prison sentence for 6,314,108 Drachmas [US$20,392], a practice allowable under Greek law. The pilot also paid his fine and immediately appealed his prison sentence. Greek Ministry of Mercantile Marine also fined the tanker © 2003 Environmental Research Consulting
owner 195,246,945 Drachmas [US$630,576].
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Case Study: T/V Kriti Sea On 9 August 1996, the Greek-flagged tanker Kriti Sea (123,436 DWT; 62,678 GT) was struck by lightning during a sudden thunderstorm while the tanker was unloading at the Motor Oil Refinery Installations in the Korinthós Canal, Agioi Theordori port, Isthmia, Greece. The jolt of the lightning caused the loading pipes to break off, spilling 300 tonnes (88,200 gallons) of light crude oil. The rocky shores of the port and stretches of nearby beach were heavily oiled. Seven fish farms were also impacted. Four days after the incident, the Greek Ministry of Mercantile Marine announced that it had fined the shipowner, Varmina Corporation International S.A., 91,953,035 Greek Drachmas [US$297,531] for causing the oil spill. On 5 November 1996, Greenpeace activists chained themselves to the docking facilities at the refinery demanding that the refinery be held responsible for polluting the environment. The protestors also demanded that the Greek government enact stricter oil pollution laws, ban the use of chemical dispersants, and prohibit unloading at the refinery in bad weather or at night. Terminal officials pointed out that they had assisted in the cleanup operations beyond their responsibility by law. Nevertheless, on 13 November 1996, the ministry imposed a 199,231,500-Drachma [US$643,444] fine on the refinery. The Motor Oil Refinery had already paid an initial deposit of 98,083,200 Drachmas [US$316,772] to the ministry for causing pollution before authorities allowed the ship to leave the port.
Germany In Germany, the Penal Code covers breaches of MARPOL 73/78 and the Helsinki Convention. Under penal law, intentional unauthorized oil pollution of water carries a penalty of imprisonment of up to five years or the imposition of a court fine. The fine is imposed per diem and amounts to a maximum of 10,000 German Marks (DM) [US$5,388] per day. In the case of a specific jeopardy to certain legal rights, such as the life and limb of third persons, or injury to components of the natural environment of considerable ecological significance, imprisonment from six months to 10 years can also be imposed by the German authorities. In addition to the penal code, breaches of the discharge provisions of MARPOL 73/78 and the Helsinki Convention area also considered breaches of administrative © 2003 Environmental Research Consulting
regulations under the jurisdiction of German authorities if the violation was committed by a German citizen or by a foreigner on a German-flagged ship. An offender who is a foreigner on a ship not flying the German flag can be prosecuted by the German administration if the violation was committed in the German exclusive economic zone, territorial sea, or internal waters on which MARPOL 73/78 is applicable. Offenses against MARPOL 73/78 discharge regulations and the Helsinki Convention which do not simultaneously fulfill one of the aforementioned parts of the criminal offense, can be punished with an administrative fine of up to 100,000 DM [US$53,823]. Violations regarding the keeping of oil or cargo record books carry administrative fines of up to 50,000 DM [US$26,911]. For breaches of duty to keep oil record books, the German courts differentiate between cases in which the amount of sludge is not recorded but is still on board the vessel or has been properly incinerated, and cases in which it has been discharged illegally. In cases involving illegal discharges, the fines imposed will be up to four times as high as for cases with proper disposal or retention. Case Study: T/V Kuzzbass In June of 1996, oil began to wash up on the North Sea coastline of Germany near the Frisian Islands and Cuxhaven. Oil from the “mystery spill” formed hard, granular balls which were fairly easily removed from the sandy beaches with extensive and aggressive mechanical and manual shoreline cleanup operations. There were reports of oiled birds, as well as reports of impacts on fishing and tourism in the area connected with this incident. From the oil recovery figures by German authorities, it appears that at least 764 tonnes (225,000 gallons) of oil were spilled. German government officials investigated the source of the “mystery spill” and eventually named the Russian-flagged tanker Kuzzbass (150,500 DWT; 88,692 GT) as the responsible party based on oil sample and drift analyses. The suspicion against the tanker was based on information that the tanker had spent 53 hours on its good-weather passage from the German Bight to the Dover passage in a trip that normally takes about 30 hours While no formal fines or with a normal speed of 14 knots. The investigators penalties were imposed on suspected that the tanker was engaging in tank the tanker owners when a washing in violation of MARPOL 73/78 Annex I tanker was charged with Regulation 9. The recovered oil was eventually illegal tank washing, the fingerprinted as Libyan crude oil from the tanker German government Kuzzbass. brought legal action against the owners and insurers for The state attorney of Flensburg (capital of compensation of the Schleswig-Holstein) made charges against the US$1,570,957 in costs for tanker captain. This action was carried further by the the extensive shoreline cleanup operations.
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appropriate authorities in the other localities involved -- Hamburg and Niedersachsen. The tanker was charged with illegal tank washing. An investigation by the German Federal Maritime and Hydrographic Agency showed that the oil found on the beaches had the higher paraffin content typical of tanker washings. Drift analysis indicated that the oil found on all the various beaches and islands had all originated from the same location. The Kuzzbass had offloaded the Libyan crude oil in Wilhelmshaven and was on its way to Malta via Dover. Fingerprint analysis ruled out the possibility that the oil originated from North Sea exploration and production platforms or pipelines. In some cases officials While no formal fines or penalties were ever pursue a discharge violator imposed on the tanker owners in this case, the not for imposing fines but to German federal government brought legal action obtain reimbursement for against the tanker’s owners (and insurers) in July cleanup costs. 1998 for the compensation of the DM2,900,274 [US$1,570,957] in costs for the extensive shoreline cleanup operations. After a decision by the Minister of Traffic and the Justice Ministry, cost information was also sent to the 1992 IOPC Fund of which Germany is a member. According to German authorities, the IOPC Fund is should pay cleanup costs, if, despite intensive efforts, the tanker cannot be positively identified or legally cited. The Water and Shiptransport Directorate North in Kiel was in charge of the investigation against the Kuzzbass. The Russian shipping company Novorossiysk and its insurance agent disputed the charges and have asked for a qualified decision of their innocence. The IOPC Fund can only reimburse the response costs if the Directorate cannot establish the guilt of the Novorossiysk in a civil proceeding. It is understandable that, since this is likely to involve a lengthy suit, the IOPC Fund will repeatedly press the tanker owner to take financial responsibility. Consequently, in a written decision the Fund reiterated that all legal possibilities have to be exhausted in pursuing the Kuzzbass owners to uphold the CLC. The case is still pending in court and with the IOPC Fund.
United Kingdom In the UK, the Enforcement Unit of the Maritime and Coastguard Agency (MCA) consists of a small team of specialist enforcement officers, tasked to enforce the UK Merchant Shipping legislation, including the Merchant Shipping (Prevention of Oil Pollution) Regulations of 19996, which implement MARPOL 73/78. © 2003 Environmental Research Consulting
The maximum fine under these regulations is £250,000 [US$409,641] in the Magistrate’s Court. The fine is unlimited in the Crown Court. Most proceedings are conducted in the Magistrate’s Court. The majority of these cases involve MARPOL offenses. The court considers each case on its individual merits. The amount spilled, intention, negligence, and environmental impact are all considered by the court in imposing fines. In September 1997, the UK shipping minister boosted the maximum fine for spilling oil from a ship five-fold – from £49,610 [US$81,109] to £257,125 [US$420,382]. Officials hoped to “send a strong message to all tanker owners and masters that antipollution offenses will be enforced vigorously and that offenders will be named.” According to Shipping Minister Glenda Jackson, shaming and sterner punishment fits into a four-part strategy of combating illegal discharges of ship’s waste. The UK strategy includes: • • • •
Discouraging pollution; Encouraging responsible disposal of waste in port; Advocating tighter international restrictions on ocean discharge; and Enforcement.
According to the UK Shipping Minister, shaming and sterner punishment fits into a four-part strategy of combating illegal discharges of ship’s waste: •
Encouraging responsible waste disposal in port
Advocating tighter international restrictions on ocean discharge
• Enforcement The ministry’s position is that, in order to deter polluters, fines should generally exceed the savings that disreputable shipowners can make by discharging wastes illegally at sea. The ministry cites daily operating cost figures for tankers at £2,965 to £11,920 [US$4,847 to US$19,486] per day. The ministry also stresses that courts should note the significant cost to government of dealing with discharges.
Recent UK MCA Pollution Offense Prosecutions Case Study: M/V Sirte Star On 24 September 1999, Seatide Shipping Ltd., owners of the St. Vincent & Grenadinesflagged cargo vessel Sirte Star, were fined £25,000 [US$41,074] and ordered to pay court costs of £1,1,90 [US$1,955] for violating the Prevention of Pollution Regulations after being caught spilling oil 40 km off the Norfolk, UK, coast. On 19 April 1999, the vessel had been spotted trailing a 4.8-km oil slick -- which © 2003 Environmental Research Consulting
would have contained an estimated 3-30 tonnes (882-8,800 gallons), depending on the thickness of the slick -- by a Dutch antipollution aircraft on routine surveillance. Another 20-km slick -- which would have contained an estimated 32-320 tonnes (9,40094,000 gallons), depending on the thickness of the slick -- was spotted in the vicinity. The owners pleaded guilty to the smaller slick. In the UK court, German authorities reported that they had inspected the vessel on its arrival in Bremen and found it to have a “dirty and badly maintained engine room.” The German inspectors found a recent “tide mark” 40 cm high in the engine room and suspected that the engine room bilges had been pumped at the time the Dutch authorities spotted the vessel trailing oil. There were no entries made in the oil record book. In court, the crew denied any pumping activities. The port state control history of the vessel indicated that there had been a number of deficiencies over the previous six months, including a detention by Dutch authorities in February 1999 for oily water separator deficiencies. Case Study: F/V Liliane J. On 3 March 1999, the UK court convicted Johnson Sea Enterprises, owners of the fishing vessel Liliane J., of violating the Prevention of Oil Pollution regulations. The vessel had been spotted by a Dutch surveillance aircraft discharging an oily mixture into the sea. The slick measured approximately 9 km in length -- which would have contained an estimated 27-270 tonnes (7,900-79,000 gallons), depending on the thickness of the slick. The UK court fined the owners £9,000 [US$14,787] plus £960 [US$1,577] in court costs. Case Study: Luckyman On 13 January 1999, the UK court convicted Lindos Shipping Co., Ltd., Cyprus, owners of the Cypriot-flagged bulk carrier Luckyman (27,000 DWT; 17,512 GT) for violating the Prevention of Oil Pollution regulations. The vessel had been spotted by Dutch surveillance aircraft trailing a 30-km oil slick -- which would have contained an estimated 90-900 tonnes (26,000-260,000 gallons), depending on the thickness of the slick -- 64 km east of Wick, UK. Photographs of the slick were passed on to MCA. The UK court sentenced the owners to £7,500 [US$12,382] in penalties plus £960 [US$1,577] in court costs. Case Study: M/V Anglian Duke On 15 September 1998, the UK court convicted Klyne Tugs, Ltd., owners of the M/V Anglian Duke, of violating the Prevention of Oil Pollution Regulations, after a Dutch © 2003 Environmental Research Consulting
surveillance aircraft spotted the vessel discharging an oily mixture overboard. The Dutch coast guard subsequently found the spill to have been caused by a faulty oily water separator and faulty wiring on the alarm system. The UK court sentenced the owners to £35,000 [US$57,503] in penalties plus £2,130 [US$3,499] in costs. Upon appeal on 27 November 1998, the court reduced the fine to £20,000 [US$32,859]. Case Study: M/V Weser On 22 July 1998, the UK court convicted Bent Emanual Christiansen, owners of the Danish-flagged bulk carrier Weser (3,981 DWT; 2,709 GT) of causing oil pollution off the Cornwall, UK, coast, in violation of the Prevention of Oil Pollution Regulations. The vessel had been spotted and reported by a passenger aircraft, upon which a fisheries patrol surveillance aircraft tracked the spill. The UK court sentenced the vessel owners to £250,000 [US$410,734] in penalties plus £1,243 [US$2,042] in court costs. Upon appeal on 18 December 1998, the court reduced the fine to £25,000 [US$41,074]. Case Study: M/V Resolution Bay On 30 June 1998, the UK court convicted P&O Nedloydm, owners of the Gibraltarflagged combined carrier Resolution Bay The court assessed a “modest” (38,757 DWT; 43,674 GT), of violating the fine in the case of the T/V Prevention of Oil Pollution Regulations. The Havrim spill, because the ship vessel had been spotted by Dutch surveillance had discharged oil accidentally aircraft trailing an 80-km oil slick -- which and the owners cooperated with would have contained an estimated 240-2,400 investigators. tonnes (70,000-700,000 gallons), depending on the thickness of the slick -- in the North Sea in August 1997. The vessel was reported to German authorities for port state control, who in turn passed the information on to MCA. The UK court sentenced the vessel owners to £15,000 [US$24,644] in penalties plus £2,000 [US$3,286] in court costs. Case Study: T/V Havrim On 30 March 1998, the UK court convicted Bergersen DY ASA, owners of the Norwegian-flagged tankvessel Havrim (25,663 DWT; 26,207 GT), of discharging engine oil bilges in violation of the Prevention of Oil Pollution Regulations. The tanker had been spotted off Scotland by a Royal Air Force crew trailing a slick 11 km long by 300 meters wide -- an estimated 33-330 tonnes (9,900-99,000 gallons), depending on slick thickness. © 2003 Environmental Research Consulting
The UK court sentenced the vessel owners to £5,000 [US$8,215] in penalties plus £15,000 [US$24,644] in costs. The court assessed a “modest” fine in this case, because the ship had discharged oil accidentally and the owners cooperated with investigators. Case Study: T/V Whitstar and T/V Whitspray On 26 February 1998, the UK court convicted John H. Whitaker Tankers, Ltd., owners of the Gibraltar-flagged tankers Whitstar (2,140 DWT; 1,116 GT) and Whitspray (1,200 DWT; 899 GT), of two separate oil spills off the Kent coast. The 1997 incidents both involved the opening of the wrong valve during a blending procedure. The UK court sentenced the tanker owners a total of £20,000 [US$32,859] in penalties plus £5,680 [US$9,322] in court costs for the two incidents. Case Study: T/V Sea Empress/Milford Haven UK Port Authority On 15 February 1996, the tanker Sea Empress ran aground at the hands of an inexperienced pilot assigned by the Milford Haven UK Port Authority. The Sea Empress spilled 72,000 tonnes (21.2 million gallons) of crude oil, oiling 200 km of the Welsh coastline. Cleanup costs ran as high as £289,734,500 A Welsh judge fined the port [US$474,241,000]. The port authority authority a record US$6,535,797, subsequently pleaded guilty to violating the plus prosecution costs of 1991 UK Water Resources Act. US$1,386,381. The judge said that “genuine and justified public On 15 January 1999, a Welsh judge concern” over the spill merited the fined the port authority a record £3,993,000 “substantial” penalty. [US$6,535,797], plus prosecution costs of £847,000 [US$1,386,381]. The judge said that “genuine and justified public concern” over the spill merited the “substantial” penalty. The UK Environment Agency chief praised the judgment “as an important landmark in environmental protection” which would “send a strong message of deterrence to those operating in the marine environment” and aid the agency’s campaign for safer ports. In its prosecution, the agency dropped a public nuisance charge against the authority. The judge formally acquitted the harbormaster of three criminal charges related to the spill after the Environment Agency offered no evidence against him. With its plea the port authority issued a statement qualifying its culpability, defending its safety efforts, and warning that the Sea Empress judgment threatens not only its own operations but future pollution-combating efforts. The port authority maintains that the precedent set by this strict criminal liability is dangerous in that it may cripple future salvage efforts and result in greater environmental impacts in future spills. According to the Milford Haven UK Port Authority, “the UK courts have now interpreted the Water Resources Act so broadly that any parties remotely responsible for pollution could be convicted of a crime, regardless of what they did to prevent it or to limit the damage.” © 2003 Environmental Research Consulting
The port authority cited a 1998 decision by the House of Lords, the UK’s highest court, holding a company responsible under the Water Resources Act for an oil spill apparently caused by vandals who opened a tap on one of the company’s storage tanks. Declaring that the company had created a situation in which oil could spill into a river, the court held the company responsible for the pollution, despite someone else having caused the spill. Likewise, the Environment Agency argued that since the Port Authority created a situation where the tanker pilot might err, it was responsible for the consequences. The ruling left the port authority with no choice but to plead guilty and avoid an expensive trial. The Water Resources Act allows an accused party to proclaim innocence if it Calling the original fine “manifestly excessive,” the reported the discharge and took reasonable action British Court of Appeal cut to limit damage, but only if the spill was an the penalty, stating the court emergency measure to protect life and health. had taken into consideration Since the court ruled out the emergency clause, it the port authority’s guilty plea pleaded guilty rather than face a ruinous trial. at the original hearing, its ability to pay such a large On 26 January 1999, the port authority ansum, and the size of fines in nounced an appeal to the criminal fine, but agreed comparable cases. to pay the prosecution costs of £847,000 [US$1,386,381]. On 17 March 2000, the British Court of Appeal called the fine of £3,993,000 [US$6,535,797] “manifestly excessive” and cut the penalty to £750,000 [US$1,180,000]. The chief justice said that the court had taken into consideration the port authority’s guilty plea at the original hearing, its ability to pay such a large sum, and sizes of fines in comparable cases. The Sentencing Advisory Panel had said that the fines should be based on the financial means of the defendants. In the case of the port authority, the managing director had said that the original fine would have threatened jobs and the long-term future of the business. The advisory panel recommended that fines be “substantial enough to have a real economic impact, which together with the attendant bad publicity resulting from prosecution, will create sufficient pressure on management and shareholders to tighten regulatory compliance and change company policy.
Figure 9: Prosecutions Brought by UK Authorities in 1995 UK Authority Prosecutions undertaken Convictions Cases lost/dismissed Total fines
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imposed Awards for cleanup of which: 1. From fines 2. Addition to fines Source: ACOPS
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Figure 10: Oil Spill Prosecutions Brought by UK Authorities in 1995 Date
3 Nov 1994
Manchester Ship Channel
National Rivers Authority
20 Nov 1994
28 Jan 1995 2 Feb 1995 5 Feb 1995 22 Feb 1995 28 Feb 1995 10 Mar 1995 11 Mar 1995 21 Mar 1995 29 Mar 1995
Aberdeen Harbour Aberdeen Harbour
Procurator Fiscal Procurator Fiscal Procurator Fiscal National Rivers Authority Milford Haven Port Authority Milford Haven Port Authority Milford Haven Port Authority Milford Haven Port Authority Procurator Fiscal
3 Apr 1995 20 May 1995 25 Jun 1995 4 Jul 1995
Sullom Voe Parrett Estuary Milford Haven Milford Haven Milford Haven Milford Haven Montrose Harbour Inner Harbour Douglas Tate and Lyle Jetty Aberdeen Harbour Southend Anchorage
25 April 1995
6 Apr 1995
30 Jan 1995 Not reported 6 May 1995 20 Dec 1995 13 Jun 1995 14 Jun 1995 12 Sep 1995 15 Nov 1995 15 Apr 1996
£1,000 [US$1,635] £100 [US$163] £250 [US$409] £1,750 [US$2,861] £1,000 [US$1,635] £2,000 [US$3,269] £250 [US$409] £600 [US$981] £500 [US$817]
Isle of Man Dept. Transport
Douglas Gas Company
13 Jun 1995
Port of London Authority Procurator Fiscal Port of London Authority
M/V Tadorne II M/V Maersk Promoter M/V Good Seaman
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Source British Gas plc. Ellesmere Port M/V Grampian Chieftain M/V Mikelbaka M/V Speyside T/V Lucina M/V Conto
Coastal tanker Trawler Trawler
£5,000 [US$8,173] Not £1,000 reported [US$1,635] £2,000 27 Jul 1995 [US$3,269] 18 Jul 1995
Figure 10: Oil Spill Prosecutions Brought by UK Authorities in 1995 (cont.) Date
2 Aug 1995
Dept. Trade and Industry
22 Aug 1995 14 Sep 1995 4 Oct 1995 14 Oct 1995
Peterhead Bay Harbour Milford Haven Off Hemsby, Norfolk River Mersey
Littlebrook Power Station Source: ACOPS All spills under 2 tonnes. 5 Nov 1995
Source Rig Sedco Explorer
M/V Far Sky
Milford Haven Port Authority
14 Nov 1995
12 Oct 1995
Crossfield Chem. Warrington
26 Mar 1996
£30,000 [US$49,04 8]
Port of London Authority
21 Dec 1995
Figure 11: Prosecutions Brought by UK Authorities in 1996 UK Authority Prosecutions undertaken Convictions Cases lost/dismissed Total fines imposed Awards for cleanup of which: 1. From fines 2. Addition to fines
15 0 £54,800 [US$89,6 97)
£10,029 [US$16,4 16)
Source: ACOPS © 2003 Environmental Research Consulting
Figure 12: Oil Spill Prosecutions Brought by UK Authorities in 1996 Date
14 Oct 1995
Dec 1995 22 Jan 1996 22 Jan 1996 28 Jan 1996 22 Feb 1996 Mar 1996 22 Apr 1996 May 1996 4 May 1996 24 May 1996 14 Jun 1996 14 Aug 1996 Sep 1996 8 Dec 1996
River Ewenny, Bridgend Aberdeen Harbour Aberdeen Harbour Aberdeen Harbour Garston Dock, Liverpool Long Reach, Port of London Gravesend Reach, Port of London Dagenham, Port of London Aberdeen Harbour Aberdeen Harbour Felixstowe Milford Haven Mobil Refinery, No. 4 Jetty Peterhead Bay
Procurator Fiscal Procurator Fiscal Procurator Fiscal
Source M/V Barra Supplier (2 t spilt) Cardiff Demolition Ltd. M/V River Dee M/V Amoria M/V Dea Mariner
S. Evans & Sons, Ltd.
25 Jul 1996
Port of London Authority
M/V Maersk Anglia
18 Sep 1996
23 Jul 1996
Port of London Authority
24 Jul 1997
Procurator Fiscal Procurator Fiscal Felixstowe Dock & Railway Co. Milford Haven Port Authority
M/V Northern Prince M/V Hornbeck Swan M/V Borocay (2 t spilt) T/V Echoman
Port of London Authority Procurator Fiscal
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not known not known not known
not known not known
£300 [US$490] £500 [US$817] £500 [US$817]
£2,500 [US$4,088] £500 [US$817]
6 Dec 1996
25 Feb 1997
Mobil Oil Co., Ltd.
26 Feb 1997
ASCo Oil Service Co.
10 Jul 1997
£1,000 [US$1,635] 77
Source: ACOPS All spills under 2 tonnes except as noted.
Finland In Finland, marine protection is regulated by the Act on the Protection of the Sea, the Water Act, and the Act on the Prevention of Pollution from Ships. The Act on the Protection of the Sea governs the areas outside of Finnish territorial waters. The Water Act prohibits pollution within Finnish territorial waters. The Act on the Prevention of Pollution from Ships regulates waste and oil discharges resulting from the normal operation of ships, as well as the response to oil pollution incidents, as is thus Finland’s implementation of MARPOL 73/78 as well as the Helsinki Convention. The marine protection acts contain reference to the Finnish Penal Code applicable to more severe environmental offenses that occur within Finnish territory or Finnish territorial waters. According to the penal provisions of the Water Act, and the Act on the Finnish pollution fines are in the form of day-fines based on the Prevention of Pollution from Ships, offenses offender’s daily income. are punishable by fines. If the pollution violation is the result of gross negligence or through willful misconduct, it comes under the penal code. The violation can then lead to a sentence that includes imprisonment of up to six years along with a fine for the individual or corporation indicted. In Finland, fines are generally issued in the form of day-fines, the number of which corresponds to the blame-worthiness of the act. The amount of a day fine is determined on the basis of the offender’s daily income. The court can also impose a corporate fine, when the offense is committed by a member of the management of a corporation. The corporate fine is discretionary in that it does not require than any one person be sentenced for an environmental offense. The minimum amount of a corporate fine is 5,000 Finnish Markka [US$888]. The maximum corporate fine is 5,000,000 Finnish Markka [US$887,964].
Ireland According to Irish environmental law, criminal penalties for oil spills are capped at 1,000 Irish Punts [US$1,345] for cases heard in district court, but can be raised to © 2003 Environmental Research Consulting
25,000 Irish Punts [US$33,635] in a higher court. District courts are disadvantaged in that they do not have the authority to make spillers pay. If there is a dispute over the amount of the fine or over spill responsibility or culpability, the local county council has no redress. But district court action is generally swifter than higher court cases. In January 1998, the Irish Environmental Protection Agency announced that it would prosecute Irish Refining for spilling 31 tonnes (9,100 gallons) of heavy fuel oil into Cork Harbor on 4 November 1997. The spill caused extensive shoreline damage and significant environmental damage, according to local officials. Cleanup costs totaled 1 million Irish Punts [US$1,345,000].
Norway The Norwegian Pollution Control Act stipulates that serious pollution violations are punishable by prison sentences of up to five years, and that “very serious” violations are punishable by prison sentences of up to ten years. In addition, vessel owners can be fined 50,000 to 120,000 Norwegian Krona [US$6,347-US$15,233]. Crew members can be fined about one month’s salary. The Norwegian Pollution Control Authority notes that these fines will likely be adjusted upwards in the near future. The Norwegian Pollution Control Authority believes The fines and sentences are imposed by a that fines imposed on Norwegian court, which takes into account the shipowners and crews have amount of oil spilled, the environmental contributed to the decline in damages, and the degree of negligence in setting recorded oil spills. the fines and sentences. In 1998, 78 oil spills totaling 148 tonnes (43,500 gallons) were recorded from ships in Norwegian waters. These were the lowest numbers since the oil spill registry was started in 1987, when 144 spills occurred. The Norwegian Pollution Control Authority believes that fines imposed on shipowners and crews have contributed to this decline. Case Study: M/V Arisan In 1992, the M/V Arisan grounded and became a total loss on the Norwegian coast, spilling 150 tonnes (44,100 gallons) of heavy fuel oil. Cleanup costs totaled 35 million Norwegian Krona [US$4,442,847]. The captain of the ship was sentenced to 30 days in jail and fined 30,000 Norwegian Krona [US$3,808] for negligence that led to the grounding and total loss of the vessel. © 2003 Environmental Research Consulting
Case Study: M/V Petter Wessel In 1999, the crew of the M/V Petter Wessel accidentally pumped about 4,000 liters (3.6 tonnes or 1,060 gallons) of lubricating oil into the Oslofjord. The owner of the vessel was fined 50,000 Norwegian Krona [US$6,347] and one of the crew members was fined one month’s salary for negligence on duty.
Sweden The primary Swedish regulations regarding the enforcement of MARPOL 73/78 and the Helsinki Convention are the Act (1980.224) Concerning Measures for the Prevention of Water Pollution From Ships, the Ordinance (1980.789) Concerning Measures for the Prevention of Water Pollution From Ships, and In Sweden, a pollution fine is the Decree by the National Maritime Adminiconsidered a complement to stration (SJÖFS 1985.19) which contains criminal punishment, not a regulations concerning measures for the replacement for it . prevention of water pollution from ships. An administrative fine (water pollution fee) is imposed if the oil discharge prohibition has been violated and the discharge is not insignificant. The Swedish authorities can also impose such a fine if the oil discharge is accidental but the polluter neglected to try to limit the discharge to the best extent possible. The fine (fee) is considered a complement to criminal punishment, not a replacement for it. The magnitude of the fine depends on the extent of the discharge and the size of the ship (gross tonnage). Fines are imposed as day-fines or, if the punishment for the crime should be less than 30 day-fines, to money-fines. The number of day-fines reflects the blameworthiness of the offense and the amount reflects the income level of the person convicted. The number of day-fines varies from 30 to 150, or, if it is a joint punishment for several crimes, at most 200. The amount of a day-fine may vary from 30 to 1,000 Swedish Krona [US$4 to US$121]. Money-fines may vary from 100 to 2,000 Swedish Krona [US$12 to US$242], or in the case of joint punishment, at most 5,000 Swedish Krona [US$606].
Denmark © 2003 Environmental Research Consulting
The Danish Act for the Protection of the Marine Environment 1980, as amended in 1993, contains the main anti-pollution regulations concerning the sea. The act is based on the regulations of MARPOL 73/78 and the Helsinki Convention (as regards regulations in the Baltic Sea). The act states that sanctions can be imposed on oil polluters depending on evidence of intent or degree of negligence in conduct by the master or crew members of the offending vessel. If intent or negligence in conduct can be proven in court and the infringement has damaged the environment, or the infringement has been committed due to economic considerations (i.e., there appears to be an economic benefit for noncompliance), prison terms of up to two years can be imposed by the court. Other infringements of discharge standards are punishable by fines. Masters are normally fined for illegal discharges at sea. The amount of the fine varies between 2,100 Danish Krones [US$297] to 5,600 Danish Krones [US$793]. Cases of violations of the duty regarding oil or cargo record books are mostly withdrawn or closed with a warning. A shipowner however, can be fined by the Danish court for infringement of discharge standards without reference to intent or negligence.
France Regulations implementing MARPOL 73/78 in France call for maximum penalties of two years in prison and a 1-million French Franc [US$146,228] fine for the masters of larger tankers. Penalties for violations from smaller tankers are a one-year prison term and a 300,000-French-Franc [US$43,875] fine.
In June 2000, the French National Assembly passed a bill increasing penalties for captains of large tankers that clean their tanks by dumping oil in banned areas.
In June 2000, the French National Assembly passed a bill increasing penalties for captains of large tankers that clean their tanks by dumping oil in banned areas. Under the new bill, the penalties would be raised to four years in prison and a 3-million French Franc fine [US$438,685] for larger tankers and a two-year prison sentence and 900,000-French-Franc [US$131,228] for smaller tankers.
Estonia In Estonia, the Water Act, Code of Administrative Offenses, Pollution Charge Law, and Merchant Marine Code cover oil discharges at sea, and act as national implementation of MARPOL 73/78. © 2003 Environmental Research Consulting
Administrative fines pursuant to the Estonian oil pollution legislation can be issued in amounts up to 4,430 Estonian Kroons [US$298] for individuals and up to 114,789 Estonian Kroons [US$7,729] for legal entities [corporations]. In addition, the shipowner has to pay a pollution charge of 188,371 Estonian Kroons [US$12,684] per tonne of oil discharged (US$44/gallon]. Violations of duty for keeping proper oil record books carry fines of from 1,840 Estonian Kroons [ US$124] to 3,973 Estonian Kroons [US$268].
Latvia In Latvia, all legal actions with respect to the enforcement of antipollution regulations are fixed in the Administrative Code of administrative offense of Latvia. In the case of oil record book violations, the masters and responsible crew members of Latvian citizenship can be fined up to 250 Latvian Latvian authorities can Lats [US$426]. Foreign masters and responsible crew impose fines on foreign members can be fined from 500 Latvian Lats masters and crews that [US$853] to 3,000 Latvian Lats [US$5,119]. are up to 40 times higher than those imposed on The Administrative Code provides for the followLatvian seamen. ing penalties in the case of violations of antipollution regulations in Latvia’s exclusive economic zone and territorial sea: the masters and responsible crew members of Latvian citizenship can be fined up to 250 Latvian Lats [US$426]. Foreign masters and responsible crew members can be fined from 2,000 Latvian Lats US$3,413] to 10,000 Latvian Lats [US$17,064]. The Administrative Code provides for the following penalties in the case of violations of the obligation to report discharges to the nearest port: the masters and responsible crew members of Latvian citizenship can be fined up to 250 Latvian Lats [US$426]. Foreign masters and responsible crew members can be fined from 500 Latvian Lats US$853] to 3,000 Latvian Lats [US$5,119]. The levels of administrative fines are different depending on the vessel’s flag, Latvian-flagged ships face fines of from 20 Latvian Lats [US$34] to 250 Latvian Lats [US$426]. Ships flying foreign flags face fines from 1,162 Latvian Lats [US$1,984] to 5,812 Latvian Lats [US$9,918]. For actual pollution, the violator must also pay an environmental damage reimbursement of 32 Latvian Lats [US$54] per kilogram (US$54,000/tonne or © 2003 Environmental Research Consulting
US$184/gallon) of oil spilled. The Latvian government is also in the process of revising a “natural resources tax” in which pollutants are classified according to their toxicity and fines are set accordingly. For oil, the current tax rate for water pollution is 2,500 Latvian Lats [US$4,266] per tonne (US$15/gallon) of oil spilled. The tax rates are expected to be increased with the new legislation.
Lithuania Lithuania is preparing its new Law on Marine Environmental Protection. In the interim, penal and administrative codes cover fines for oil pollution offenses. The Lithuanian Administrative Law Violation Code (Article 56) The Lithuanian penal provides for fines up to 1 million Lithuanian Litas code calls for personal [US$247,688] for violations of regulations preventpunishment of up to five ing oil pollution of the sea. The penal code provides years in prison for oil for personal punishment of up to five years in prison. pollution cases. According to national legislation, offenses against MARPOL 73/78 or the Helsinki Convention may be fined as breaches of administrative regulations as follows: •
Illegal discharges: Fines of 8,000 Lithuanian Litas [US$1,982] up to 100,000 Lithuanian Litas [US$24,782] or 240 Lithuanian Litas [US$59] per kilogram (US$59,000/tonne or US$628/gallon) of oil spilled; and
Violations of oil or cargo record books: Fines of 3,000 Lithuanian Litas [US$743] up to 5,000 Lithuanian Litas [US$1,239].
In addition to the above fines, MARPOL 73/78 discharge offenses can carry additional administrative fines of up to 1,000,525 Lithuanian Litas [US$247,818] for responsible persons. The penal code provides for an administrative court fine and imprisonment of up to five years for intentional unauthorized pollution of water with heavy consequences to the sea fauna or flora.
© 2003 Environmental Research Consulting
Poland In Poland, authority for prosecuting violation of laws and regulations on the protection of the marine environment is provided for in the Act of March 21, 1991 On Marine Areas of the Republic of Poland and One Maritime Administration, as well as the Act of March 16, 1995, on the Prevention of Pollution of the Sea From Ships. Oil pollution fines of up to Oil pollution in Polish waters due to dumping of oil is punishable by fines of 1,000,000 Special Drawing Rights, as defined by the International Monetary Fund [currently about US$1,371,289].
20 times the average monthly salary in the Polish national economy can be imposed on shipmasters and crews.
The following oil pollution violations in Polish waters on the part of the shipmaster or other crew member carry fines of up to 20 times the average monthly salary in the national economy for the preceding year: • Failure to take care of ship seaworthiness or other pollution prevention functions; •
Failure to keep oil or cargo record books;
Failure to have the ship inspected;
Causing oil pollution at sea;
Failure to notify authorities in the event of oil discharge;
Failure to take necessary measures to prevent or limit oil discharge;
Failure to provide information in oil pollution cases;
Failure to use oil and waste reception facilities as required in port; and
Failure to report equipment failures.
Russia © 2003 Environmental Research Consulting
The Russian Department of Maritime Transport of the Ministry of Transport is the national authority that administers the implementation of MARPOL 73/78 requirements. The Ministry for Environmental Protection and Natural Resources is responsible for the implementation of the Helsinki Convention. In 1994, Russia revised the Instruction for the Prevention of Pollution From Ships and its regulations of “operations with oil, oil products, and other substances harmful to human health and to the marine environment, and their mixtures produced on ships and other floating means.” Administrative fines for MARPOL 73/78 and other oil pollution violations are calculated in accordance with the minimum monthly salary in the Russian national economy. The maximum fines are 3,000 times the minimum salary. This protocol may be modified in connection with the reform of tax law. Court proceedings are required to impose fines on a legal entity (e.g., a corporation), but not on an individual.
Ukraine Penalties for oil pollution in Ukrainian waters are based on the assessed damages, with additional fines set by the Water Resources Act. Case Study: T/V 25 M On 12 August 1998, the Russian-flagged tanker 25M was cited for dumping bilge oil into the Azov Sea in early July 1998. The 5-km oil slick was carried out to sea and dispersed.
A Ukrainian court indicted the operator of a Russian tanker for dumping bilge oil into the Azvov Sea and assessed a fine equivalent to over US$106,000.
A Ukrainian court had indicted the shipowner on 24 July 1998 on pollution charges. 1995 Ukrainian laws allow authorities to calculate and assess damages caused by pollution from ships and impose fines for violation of the nation’s Water Resources Act. The tanker 25M was assessed a fine of 592,020 Ukrainian Hryvnias [US$106,564].
© 2003 Environmental Research Consulting
Albania In Albania, oil polluters are prosecuted under the 1991 Law on Environmental Protection. The fines for illegal discharges are Lek 1,000 [US$10] up to Lek 50,000 [to US$500] for individuals and Lek 5,000 [US$50] up to Lek 500,000 [US$5,000] for corporations and other entities.
© 2003 Environmental Research Consulting
Bulgaria The Bulgarian Environmental Protection Act of 1991 (as amended in 1992, 1995, 1997, 1998, and 1999) regulates fines and penalties associated with oil pollution. Penalties under the Environmental Protection Act include: •
Pollution offenses that do not othFines for repeat offenders in erwise constitute a crime are punBulgaria can exceed ishable by fines from 50,000 to US$3.2 million. 3,500,000 Bulgarian Leva [US$23,000 to US$1,610,000]; Repeat offenders or offenses by individuals acting in an official capacity are liable to fines of 100,000 to 7,000,000 Bulgarian Leva [US$46,000 to US$3,220,000]; Obviously insignificant violations are subject to fines not to exceed 50,000 Bulgarian Leva [US$23,000];
© 2003 Environmental Research Consulting
Oil Spill Penalties in Africa Exposed to some of the most heavily-traveled shipping lanes, African nations remain vulnerable to oil pollution from passing tankers and merchant ships. African shores are also vulnerable to spills related to their own oil industry, particularly in Nigeria. The United Nations Environment Program is working with African nations to increase their oil spill response preparedness and to implement legislation aimed at escalating penalties for oil polluters.
Kenya Kenya’s Merchant Shipping Act provides for a maximum penalty of 12,050 Kenyan Shillings [US$158] against vessels that spill oil in a harbor or within 185 km of the Kenyan coast. Kenya’s oil pollution policy is noted for being particularly weak.
The oil pollution policies and fines in Kenya and Nigeria are noted for being particularly weak.
Nigeria The Nigerian Oil in Navigable Waters Act of 1968 covers illegal discharges of oil into Nigerian waters. The legislation, which was intended to act as Nigeria’s implementation of the IMCO convention OILPOL 54/62. Discharges of oil from vessels, oil transfer operations, and discharges of oil from facilities are covered. Unless it can be proven that a discharge was due to measures needed to save human life or securing the safety of the vessel or facility, or if reasonable measures were taken to prevent spillage and the unintentional discharge was immediately reported, violators are subject to prosecution. The fines that can be imposed, however, are extremely low when compared to those of other nations. For illegal discharges or failures to maintain oil spill prevention equipment on vessels, the Nigerian court can impose a fine of in excess of 2,000 Naira [US$21]. For failure to maintain oil record books, the court can impose a fine of 1,000 © 2003 Environmental Research Consulting
Naira [US$11] and/or a prison term of up to six months. For oil transfer operations at night without the appropriate permits and 96-hour notifications, the fine is up to 200 Naira [US$2]. Illegal discharges of oil residues/oily ballast in harbors are punishable by fines up to 20 Naira [US$0.20] per day. For failure to pay fines the court can seize vessels and equipment.
South Africa The South African Marine Pollution (Prevention of Pollution From Ships) Act allows the South African Maritime Safety Authority (SAMSA) to require shipowners to deposit money as an “admission of contravention” when there is an oil spill or illegal discharge of oil. This money may later be forfeited on the part of the shipowner in lieu of a fine when and if a fine is set by the principal officer investigating the incident and the offender does not wish to pursue the matter in The South African Maritime court. Safety Authority requires shipowners to deposit The pollution act also allows for additional money as an “admission of fines of 200,000 South African Rands [US$32,693] contravention” in the event for serious incidents and 500,000 South African of an oil discharge. This Rands for the most serious offences. Generally, money can later be forfeited only severe oil spill incidents make it to a South in lieu of a fine and court African court, as most owners chose to take proceeding. Most owners advantage of the “admission of contravention” take advantage of this facility, if offered. facility when offered. According to SAMSA, the polluter is also required to pay cleanup costs and, as the South African regime is “not very litigious,” the matter generally “seems to die away” as long as the polluter carries out a proper cleanup response. Nevertheless, during the years 1998-1999, there were only 13 relatively minor oil pollution incidents, four of which emanated from South African vessels and nine from foreign-flagged vessels, that were investigated under the Marine Pollution (Prevention of Pollution From Ships) Act. None of the incidents were tested in court as all the vessel owners chose to take advantage of the “admission of contravention” facility. The amount of 567,500 South African Rands [US$92,767] was forfeited in this manner. Fines ranged from 500 South African Rands [US$82] to a maximum of 100,000 to a maximum of 100,000 South African Rands [US$16,347]. In three incidents, South African fishing vessels were fined for pumping oily bilge © 2003 Environmental Research Consulting
water overboard. Two vessels were photographed by South African pollution aircraft trailing oil slicks. The two vessels “admitted contravention” and deposited 100,000 South African Rands [US$16,347] and 75,000 South African Rands [US$12,260], respectively. Two ships suffered spills during cargo discharge operations. Six ships, including a South African bunker barge, suffered spills during bunkering operations.
Mauritius In Mauritius, the Mauritius Ports Authority imposes fines on oil spillers as per the nation’s Ports Act. The fines tend to be imposed for recovering cleanup costs as well as for imposing punitive measures. The fines are based on the amount of oil spilled, the standby response charges, the amount of dispersant used [the primary response strategy in Mauritius], the cost of labor, the utilization of pollution equipment, and the administrative cost. Recent examples of fines imposed for oil spills are shown in Figure 13.
Figure 13: Fines Imposed for Oil Spills in Mauritius Spill Date
14 August 1997
M/V Fas Columbo
328,000 Mauritius Rupees [US$12,919]
10 November 1997
M/V Cape Flower
136,000 Mauritius Rupees [US$5,357]
10 April 1998
M/V Cisne Verde
22,438 Mauritius Rupees [US$884]
© 2003 Environmental Research Consulting
Oil Spill Penalties in Asian and Pacific Nations Australia In Australia, the national MARPOL legislation, the Marine Pollution Act of 1987, provides for monetary penalties of up to A$200,000 [US$130,907) for the vessel master and up to A$1,000,000 [US$654,537) for the vessel owner. The same penalty applies to all types of MARPOL discharges. The penalty Australian Maritime Safety is determined by an Australian court. The Authority officials believe that its court judge generally weighs the following enforcement actions have factor in setting the sentence: the amount of halted the increase in oil oil actually spilled; the degree to which pollution incidents that they had negligence was involved; and the environmental and/or property damages that occurred been recording in the early 1990s. as a result of the oil spill or illegal discharge. Officials at the Australian Maritime Safety Authority (AMSA) are of the opinion that the enforcement actions that it has pursued have halted the increase in the types of oil pollution incidents that they had been recording in the early 1990s. Recent prosecutions by AMSA are shown in Figure 14. The Australian Environmental Protection Authority (EPA) prosecutes spills from facilities, such as the 153-tonne (45,000-gallon) spill from the Port Stanvac oil refinery in Adelaide, South Australia, in June 1999. The charges, in this case, included the maximum penalty of Aus $200,000 (US$117,606) for discharging oil into the marine environment and two breaches of license conditions, each carrying a maximum penalty of Aus $120,000 (US$70,558). Case Study: T/V Laura D’Amato In March 2000, an Australian court ordered the owners of the tanker Laura D’Amato to pay Aus$5.5 million [US$3.3 million] in penalties for an oil spill of 267 tonnes (78,500 gallons) of light crude oil into Botany Bay, Sydney, that occurred in August 1999. The oil spilled after sea-chest valves were opened when the tanker was docked at the Gore Bay Shell Terminal. Investigators concluded that the valves were probably tampered © 2003 Environmental Research Consulting
with by a crew member during an earlier refueling stop in Singapore. The New South Wales Land and Environment Court ruled that the ship’s owner would have to pay Aus$510,000 [US$308,000] for its role in the spill in addition to cleanup costs of Aus$4.5 million [US$2.7 million] and Aust$400,000 [US$242,000 in legal fees.] The penalties, which were the largest in Australian history for a marine oil spill, were nevertheless below that which the prosecution had demanded – Aus$825,000 [US$500,000]. The chief officer was held directly responsible for the spill and fined Aus$110,000 [US$66,000]. The ship’s master was cleared of any wrongdoing in the case.
Figure 14: Australian Maritime Safety Authority Oil Pollution Prosecutions Prosecution Date Incident Date 1 Jun 1998 14 Dec 1996 30 Jul 1998 9 Feb 1996 13 Aug 1998 29 Jul 1997 1 Sep 1998 9 Sep 1997 16 Feb 1999 4 Jun 1997
NSW NSW VIC VIC NSW
Vessel Stolt Otome Kopopo Chief Capitaine Fern Alam Tenaga Asian Glory
Amount Spilled Liters (tonnes) 40 ltr (0.04 t) 150 ltr (0.13 t)
4 Mar 1999 28 Jul 1997
25 Jun 1999 19 Aug 1998
12 Aug 1999 19 Apr 1998
Dalrymple Bay Mooloolaba Boat Harbour
26 Feb 1997 28 Jan 1995 14 Mar 1997 22 Nov 1992 10 Apr 1997 27 Mar 1996 23 Jul 1997
NSW NSW VIC VIC
Pyrmont Bridge Anro Australia Capitaine Cook Lijnsbaan-
White Bay Brotherson Dock Geelong No. 4 VIC
© 2003 Environmental Research Consulting
500 ltr (0.45 t) 50 ltr (0.04 t) 18,000 ltr (16.18 t) 45 ltr (0.04 t) 180 ltr (0.16 t) 150 ltr (0.14 t) 1,000 ltr (0.90 t) 2,500 ltr (2.25 t) 10 liters
Penalty Aus$40,000 US$26,181 Aus$61,000 US$39,927 Aus$40,000 US$26,181 Aus$12,500 US$8,182 Aus$100,000 US$65,454 Aus$72,000 US$47,127 Aus$20,000 US$13,090 Owner Aus$20,000 US$13,090 Aus $50,000 US$32,727 Aus$110,000 US$72,000 Aus$6,500 US$4,255 Aus$42,000 92
(16 May 1996)