Why in News?

Recently, the Singapore-flagged vessel MV Wan Hai 503 caught fire 88 nautical miles off Kerala’s Beypore coast while carrying over 2,000 tonnes of fuel and hundreds of containers, raising concerns about ecological damage. Search operations for hazardous containers continue.

Earlier, on May 25, the Liberian container ship MSC ELSA 3 sank off the Kochi coast.

What’s in Today’s Article?

• Regulating Framework for Global Shipping
• Decoding Liability: Cargo Loss and Environmental Damage at Sea
• Salvaging a Sunken Ship: Owner’s Responsibility
• Why Ships Still Sink Despite Modern Technology

Regulating Framework for Global Shipping

• Global Oversight: Role of the IMO
  • The International Maritime Organization (IMO), a UN agency, is the primary global regulator of merchant shipping.
  • It sets standards on pollution control, safety, accidents, liabilities, and responsibilities.
  • Member countries, including India, adopt these conventions by passing domestic laws aligned with IMO norms.
• India’s Maritime Regulation Framework
  • In India, the Directorate General (DG) of Shipping implements IMO conventions through official notices and regulations.
  • In certain cases, parliamentary approval is required.
  • While India has ratified many IMO conventions, it has yet to adopt key ones like:
    • The 2004 Ballast Water Convention
    • The 2010 Hazardous and Noxious Substances (HNS) Convention, which governs liability for accidents involving harmful cargo.
• Case Study: MSC ELSA 3 and the HNS Gap
• In the case of MSC ELSA 3, which sank off Kochi carrying hazardous substances like calcium carbide, India will seek legal remedies under its own maritime laws, as it hasn’t ratified the HNS Convention.
• The incident underscores the need for India to adopt this treaty amid rising coastal shipping incidents.
• Flags of Convenience: Regulatory Loopholes
  • Though ships are owned by companies in countries like Greece and China, many are registered under “Flags of Convenience” (FOC) nations such as Liberia or the Marshall Islands.
  • These countries offer minimal regulatory oversight despite being IMO members, enabling shipowners to reduce costs and bypass stricter national laws.

Decoding Liability: Cargo Loss and Environmental Damage at Sea

• Cargo Liability Lies with Ship Owner
  • The ship owner is legally responsible for the loss or damage of cargo.
  • This is governed by a contract known as the bill of lading, issued during cargo loading.
  • It serves as both a receipt and a contract of carriage between the ship owner and the exporter.
  • Eventually, the bill is transferred to the importer via bank channels using letters of credit.
• Protection Through P&I Clubs
  • Ship owners are protected by Protection and Indemnity (P&I) Clubs, a consortium of insurance companies that cover:
    • Loss of cargo
    • Environmental damage
    • Loss of life
    • Legal claims arising from shipping accidents
  • These clubs provide insurance against liabilities, while hull and machinery insurance covers damage to the vessel itself.
• Environmental Damage and Unlimited Liability
  • Under international conventions, liability for cargo loss is capped.
  • However, claims for environmental damage (such as oil spills or toxic chemical leaks) are not capped.
  • This includes:
    • Fishery losses
    • Tourism impacts
    • Coastal business disruptions
    • Transportation issues
  • Such claims are governed by the International Convention for the Prevention of Pollution from Ships, which upholds the “polluter pays” principle.
• Legal Safeguards and National Laws
  • Although ship owners may face extensive environmental claims, national laws sometimes place limits on liabilities to avoid open-ended legal and financial consequences.

Salvaging a Sunken Ship: Owner’s Responsibility

• The ship owner is responsible for salvaging a sunken vessel. If refloating is not feasible, especially in deep waters, the owner remains liable for any resulting damage.
• Legal Framework: Nairobi Convention, 2007
  • This obligation is governed by the Nairobi Convention on the Removal of Wrecks, 2007, to which India is a signatory.
  • The convention applies to wrecks located within India’s sovereign waters, extending up to 200 nautical miles from the coastline.

Why Ships Still Sink Despite Modern Technology

• Modern ships are built with advanced materials and expertise, but they remain vulnerable to the unpredictable forces of the sea.
• For example, ELSA 3 began listing due to falling containers in rough waters, eventually leading to its sinking.
• Small Errors, Big Consequences
  • Often, a chain of minor human or technical errors can escalate into a major maritime disaster.
  • Many such incidents are man-made and preventable, such as poor navigation or ignoring weather warnings.
• Risky Behaviour at Sea
  • In search of mobile phone signals, some merchant ships sail too close to the coast, increasing the risk of grounding.
  • The Wakashio oil spill off Mauritius in 2020 occurred due to such behaviour, especially during the COVID-19 pandemic when seafarers were under emotional stress.
• Legacy of the Titanic: SOLAS Convention
  • The sinking of the Titanic due to human error led to the creation of the Safety of Life at Sea (SOLAS) convention.
  • A key rule now requires lifeboats on one side of a ship to hold all passengers, ensuring safety even if one side becomes inaccessible.