Increased limits of liability

Amendments by the International Maritime Organisation (IMO) to increase the limits of liability entered into force on Monday (June 8).

These raised the amount claimable for loss of life or personal injury on ships (not exceeding 2 000 gross tonnage) to 3.02 million special drawing rights (SDR)*, up from 2 million SDR. Additional amounts are claimable on larger ships.

The 1976 Limitation of Liability for Maritime Claims (LLMC) Convention sets specified limits of liability for certain types of claims against shipowners. These were claims for loss of life or personal injury, and other claims, such as property claims (including damage to other ships, property or harbour works), delay, bunker spills, pollution damage, etc.

The Convention also allows for shipowners and salvors to limit their liability except if “it is proved that the loss resulted from his personal act or omission, committed with the intent to cause such loss, or recklessly and with knowledge that such loss would probably result”.

*The SDR is an international reserve asset, created by the IMF in 1969 to supplement its member countries’ official reserves. Its value is based on a basket of four key international currencies, and SDRs can be exchanged for freely usable currencies. 3.02m SDRs equalled R52 481 396.91 as of June 11.

Source: IMO