B — The Supplementary Fund

If the limits were not subject to too large an increase, then, in the view of the CMI, the provision for ‘roll-back’ provision (article 5) of the 1971 Fund Convention was made necessary because the 1969 Convention had greatly increased the shipowner’s per ton liability for oil pollution beyond that of the 1957 Limitation Convention for other types of property damage. However, since it was currently foreseen that both conventions may be revised simultaneously, the same ‘roll-back’ provision might not be necessary, particularly if the shipowner’s liability for oil pollution claims was not greatly in excess of its liability for other types of property damage claims. Only if such excess liability were decided upon, would it be necessary, in CMI’s view, that the ‘roll-back’ provision of the Fund Convention should be retained in such a way that the limit of the shipowner’s liability after the ‘roll-back’ would be co-ordinated with the limits of 1976 Convention on Limitation of Liability for Maritime Claims, just as the 1971 Fund Convention was co-ordinated with the 1957 Limitation Convention.

10. The comment made by the CMI in this connection was reported as follows (Official Records, supra, note 6, vol. 1, p. 170, para. 10):
The CMI took the view that the argument advanced by OCIMF that small ships can, on occasion, cause sufficiently large and expensive oil pollution problems so that a mere monetary amount per ton limit would not be adequate to compensate claims, was not without merit. However, in the CMI view, the argument did not have such validity that it would warrant abandoning the time-honoured and thoroughly tested tonnage system for limitation of liability. Further, it could be argued that it was not practical to involve the Fund with respect to relatively minor claims. For these reasons, it was the position of the CMI that the solution would be to set a reasonable minimum tonnage.

11. A proposal had been made by OCIMF that the shipowner would be responsible for the first $50 million for pollution damage per incident and the cargo-related compensation fund, the IOPC Fund, would provide a supplement coverage of $75million per incident (Official Records, supra, note 6, vol. 1, p. 170, para. 6).

12. For an analysis of art. 4 see infra, para. 5. For the history of this Protocol and the influence of the United States for its adoption see Mans Jacobsson, ‘The International Liability and Compensation Regime for Oil Pollution from Ships — International Solutions for a Global Problem’, 32 Tulane Maritime Law Journal (2007), 2 at p. 11.

13. Jacobsson (supra, note 12, p. 12) explains that the entry into force conditions had been drafted in such a way that the Protocol for its entry into force required the ratification of Japan and the United States and indicates the five reasons for which the United States had decided to abstain.

14. Official Records, supra, note 6, vol. 4, pp. 97–98 and 111.

15. This provision provided:
(b) payments to be made by the Fund in the relevant year for the satisfaction of claims against the Fund due under article 4 or 5, including repayments on loans previously taken by the Fund for the satisfaction of such claims, to the extent that the aggregate amount of such claims in respect of any one incident does not exceed 15 million francs.

16. That provision, however, pursuant to the subsequent para. 4, operates until the total quantity of contributing oil received in all Contracting States in a calendar year has reached 750 million tons or until a period of five years after the date of entry into force of the 1992 Protocol has elapsed, whichever occurs earlier.

17. Article 30(1)(b) of the Protocol.

18. Jacobsson, supra, note 12, p. 3.

19. Jacobsson, supra, note 12, p. 14.

20. Supra, Chapter 11, para. 3.

21. This double qualification originates from the Resolution adopted by the Legal Conference of 1969 by which the CLC 1969 was adopted (see Chapter 11, para. 4) and was quoted in the first Interim Report of the Working Group appointed by the Legal Committee of IMCO (LEG/WG (FUND) I/4 of 10 June 1970, in which the following statement was made (at pp. 3–4):
The Working Group unanimously agreed that one of the basic purposes of an international compensation fund was to ensure that victims of oil pollution incidents would be able in principle to have full and adequate compensation as promptly as possible. To achieve this it was agreed that the Fund should provide victims, in appropriate cases, with: (a) compensation which would be additional to what would be available to them under the 1969 Convention on Civil Liability for Oil Pollution Damage, and (b) compensation where no compensation would be due to them under the 1969 Convention.

22. Supra, Chapter 11, para. 4.

23. LEG/CONF. 2/C.1/WP.55, Official Records, supra, note 6, p. 285.

24. Official Records, supra, note 6, pp. 516–517.

25. In connection with this problem see Mans Jacobsson, ‘How clean is clean? The Concept of “Reasonableness” in the Response to Tanker Oil Spills’, in Scritti in Onore di Francesco Berlingieri, Il Diritto Marittimo, 2010, p. 565.

26. [1998] 2 Lloyd’s Rep 552.

27. At p. 563.

28. In the Milad incident the claimants were unable to trace the owners and the following analysis of a claim of the Marine Emergency Mutual Aid Centre (MEMAC) by the Executive Committee is reported in FUND/EXC.3/7 of 29 April 1999:
3.2.6 A number of delegations expressed the view that there were various additional steps which MEMAC could take to trace the shipowner. It was suggested that enquiries could be made of the Belize Registry regarding the status of the vessel and whether it was free from mortgages, any other registered encumbrances and other liens or charges. It was pointed out that a vessel of the size of the Milad 1