INSIGHT: Nairobi International Convention on the Removal of Wrecks (Wreck Removal Convention) 2007

WRC 2007

The Wreck Removal Convention was adopted at an International Maritime Organisation Diplomatic Conference in Nairobi in 2007.

The Convention entered into force on 14 April 2015. There were 15 states party to the Convention when it entered into force and other states are continuing to ratify.

Article 12 of the Convention contains a compulsory insurance regime based upon the system which is familiar from other IMO Liability Conventions, including a requirement for state issued Certificates for vessels of 300 gt or more. All International Group P&I Clubs are able to issue "blue cards" which will enable members to obtain the Wreck Removal Convention Certificates which must be carried on board in order to comply with compulsory insurance requirements of the Convention. The Certificates must be issued by a State which is party to the Convention. The flag state will issue the Certificate if it is party to the Convention. If the flag state is not party to the Convention, owners will need to find a State party which is willing to issue Certificates for vessels not flying its flag.

The text of the Convention is attached.

The IMO Press Briefing 13 April 2015 on entry into force is also attached.

The European Commission has also issued a statement welcoming the entry into force of the Convention and pointing out its relevance to ships in distress being accommodated in places of refuge.

More information is also available from the attached link to the website of Colin de La Rue, Shipping and the Environment – Legal Consultancy.

Where in force

For more on EEZ and territorial sea, see under Application and scope.

Application and scope

Geographical scope

• Exclusive Economic Zone (EEZ)
  The Convention applies to the EEZ. The EEZ starts at the seaward edge of the territorial sea and extends to a distance of up to 200 nautical miles from the coastal baseline.

• Territorial sea
  States may extend the scope of the Convention to their own territory, including territorial sea. Territorial sea normally extends 12 nautical miles from the coastal baseline. If states do not extend the scope of the Convention, incidents in their territorial waters will remain subject to domestic law and the provisions of the Convention (including the compulsory insurance regime) will not apply.

More information on the application of the Convention to the territorial sea is available here on the website of Colin de La Rue Shipping and the Environment – Legal Consultancy.

Type of ship

• Any seagoing vessel and seaborne craft, of any type whatsoever
• Compulsory insurance requirements apply to ships of 300 gt or more
• "Wreck" includes any object which is or has been on the ship.

Liability

Strict liability

Claimants do not need to show fault.

Liable party

The registered owner of the ship is obliged to remove a wreck which constitutes a hazard.

Extent of liability

Costs of locating, marking and removing a wreck which constitutes a hazard:

• "hazard" is any condition or threat that imposes a danger to navigation or may result in harmful consequences to the marine environment or damage to the coastline or related interests;
• in determining what constitutes a hazard, reference should be made to a list of 15 criteria:
  (a) the type, size and construction of the wreck;
  (b) depth of the water in the area;
  (c) tidal range and currents in the area;
  (d) particularly sensitive sea areas identified and, as appropriate, designated in accordance with guidelines adopted by the Organization∗, or a clearly defined area of the exclusive economic zone where special mandatory measures have been adopted pursuant to article 211, paragraph 6, of the United Nations Convention on the Law of the Sea, 1982;
  (e) proximity of shipping routes or established traffic lanes;
  (f) traffic density and frequency;
  (g) type of traffic;
  (h) nature and quantity of the wreck's cargo, the amount and types of oil (such as bunker oil and lubricating oil) on board the wreck and, in particular, the damage likely to result should the cargo or oil be released into the marine environment;
  (i) vulnerability of port facilities;
  (j) prevailing meteorological and hydrographical conditions;
  (k) submarine topography of the area;
  (l) height of the wreck above or below the surface of the water at lowest astronomical tide;
  (m) acoustic and magnetic profiles of the wreck;
  (n) proximity of offshore installations, pipelines, telecommunications cables and similar structures; and
  (o) any other circumstances that might necessitate the removal of the wreck.

Exclusions

• Damage resulting from act of war (terrorism is not included in definition of act of war)
• Damage wholly caused by deliberate act of a third party or by negligent maintenance of navigational aids
• Claims for pollution damage arising under the Civil Liability Convention (CLC) or the Bunkers Convention

Limitation

Owners

The Convention does not affect the shipowners' right (if any) to limit liability under any applicable national or international regime. The limitation regime which commonly applies is the Limitation Convention 1976 as amended by the 1996 Protocol (LLMC). States ratifying LLMC are able to make a reservation against LLMC applying to wreck removal. Accordingly in some jurisdictions owners will have no right to limit for liabilities arising under the Convention.

The following states which are party to the Wreck Removal Convention have notified IMO of a reservation of the right to legislate for unlimited liability in respect of wreck removal.

• Croatia
• Cyprus
• France
• Germany
• Malta
• Netherlands
• Singapore
• United Kingdom

If owners have the right to limit, they may establish a limitation fund for all LLMC claims. There is no separate limitation fund for wreck removal liabilities.

Insurers

The insurer providing compulsory insurance is always able to limit liability to third parties to an amount calculated in accordance with LLMC.

Compulsory insurance and certification

Ship less than 300 gt

No compulsory insurance requirement.

Ship of 300 gt or more

From 14 April 2015, registered owners are required to have insurance to meet liabilities under the Convention for a ship which is:

• flying the flag of a state party, or
• entering or leaving a port or offshore facility in the territorial sea of a state party

Insurance must be evidenced by a Certificate carried on board the ship.

Obtaining a Certificate

The registered owners must obtain a "blue card" from their Club confirming that the Club accepts the responsibilities which the Convention places on the insurer. The blue card will be in pdf or similar electronic format.

Owners send the blue card with their application to the authorities of the state issuing the Certificate.

Ship registered in a State Party to the Convention

Owners apply to the authorities of that state.

Ship not registered in a State Party to the Convention

Owners apply to a state which is party to the Convention and willing to issue Certificates.

The Certificate will be issued in the form prescribed in the Convention. The original must be carried on board.

Liability of insurer to third party claimants

The insurer who has issued the blue card is named in the Certificate and will be:

• responsible for owners' liabilities under the Convention
• subject to direct action by claimants
• unable to rely on policy defences (except wilful misconduct)

War and terrorism

Clubs issuing blue cards become exposed to liabilities which they do not cover since

• there is no exclusion in the Convention for terrorism (though there is for war)
• terrorism is excluded from standard P&I Club cover

Owners' war risks policies will include terrorism risks. P&I Clubs only issue blue cards if they receive an undertaking from owners that they have and will maintain war risks cover on standard terms with a separate limit for P&I liabilities.

For background information about entry into force see IG Circulars published on 21 October 2014, 23 December 2014, 6 February 2015 and 30 December 2015.