UN-ECE Draft Protocol on Liability and Compensation for Damage Resulting from the Transboundary Effects of Industrial Accidents on Transboundary Waters
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This document summarizes a draft protocol on civil liability and compensation for damage from industrial accidents affecting transboundary waters. It discusses three major industrial accidents that occurred in Italy, Switzerland, and Romania to motivate the protocol. It then summarizes key aspects of the draft protocol, including its objectives to provide compensation for damage from cross-border pollution incidents. It outlines rules for operator liability, financial limits on that liability, required response measures, procedural rules for filing claims, and expectations for the protocol's adoption.
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UN-ECE Draft Protocol on Liability and Compensation for Damage Resulting from the Transboundary Effects of Industrial Accidents on Transboundary Waters
- 1. UN-ECE Draft Protocol on Liability and Compensation for Damage Resulting from the Transboundary Effects of Industrial Accidents on Transboundary Waters Bakhtiyor Mukhamadiev Environmental Law CEPMLP, University of Dundee
- 2. Industrial Accidents Seveso, Italy 1976 Explosion at chemical plant manufacturing pesticides and herbicides. Release of dioxide. Severe contamination of 10 m3 of area. Basel, Switzerland 1986 A fire at chemical warehouse. Release of toxic chemicals into the Rhine River killing thousands of fish Baia Mare, Romania 2000 A breach in the tailings dam. Release of cyanide-rich waste in the river system(s). February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 2
- 3. Tailings Spill Accident in Baia Mare, Romania February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 3
- 4. Tailings Spill Accident in Baia Mare, Romania February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 4
- 5. Response Convention on Environmental Impact Assessment (EIA) in a Transboundary Context (Espoo, 1991) Convention on the Transboundary Effects of Industrial Accidents (Helsinki, 1992) Convention on the Protection and Use of Transboundary Watercourses and International Lakes (Helsinki, 1992) Convention on Access to Information, Public Participation in Decisionmaking and Access to Justice in Environmental Matters (Aarhus, 1998) February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 5
- 6. Draft Protocol on Civil Liability: Objectives and Scope Objective (Article 1) To provide for a comprehensive regime for civil liability and for adequate and prompt compensation for damage resulting from the transboundary effects of industrial accidents on transboundary waters Scope (Article 3) The Protocol shall apply to damage resulting from industrial accident occurring in a hazardous activity that has caused transboundary effects on transboundary waters The Protocol shall apply only to damage as referred to in paragraph 1 suffered in an area under the national jurisdiction of a Party and arising from an industrial accident occurring under the national jurisdiction of another Party February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 6
- 7. Draft Protocol on Civil Liability: Strict Liability (Art 4) The operator who caused the damage shall be liable for it No liability…shall attach to the operator, if he or she proves that, despite there being in place appropriate safety measures, the damage was: The result of an act of armed conflict, hostilities, civil war or insurrection; The result of a natural phenomenon of exceptional, inevitable, unforeseeable and irresistible character; Wholly the result of compliance with a compulsory measures of a public authority of the Party where the industrial accident occurred; or Wholly the result of the wrongful intentional conduct of a third party. February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 7
- 8. Draft Protocol on Civil Liability: Financial Limits (Art 9&11 and Annex II) Limits of Liability (Art 9) (million of Unit of Account) Category Part I Part II Substances* Substances** Min Limits of Liability (Art 11) (million of Unit of Account) Part I Substances* Part II Substances** A 10 -- 2.5 -- B 40 -- 10 -- C -- 40 -- 10 *Classified as (1) very toxic (20 tons); (2) toxic (200 tons); and (3) dangerous for the environment (200 tons). ** Petroleum products (25,000 tons): gasoline and naphtha; kerosene (including jet fuels); gas oils (including diesel fuels, home heating oils and gas oil blending streams) February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 8
- 9. Draft Protocol on Civil Liability: Substantive Rules Response Measures …the operator shall take, following industrial accident, all reasonable response measures Right of Recourse Implementation The Parties shall adopt any legislative, regulatory and administrative measures to implement the Protocol Reporting to the Secretariat on a regular basis Information exchange and all other means of cooperation Financial Limits and Security International Responsibility of States February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 9
- 10. Draft Protocol on Civil Liability: Procedural Rules Claims for compensation may be brought in the [competent] courts only where: 1. The industrial accident occurred; or 2. The damage was suffered; 3. The defendant has his or her habitual residence or principal place of residence. February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 10
- 11. Draft Protocol on Civil Liability: What Effects? The Protocol gives individuals affected by the transboundary impact of industrial accidents on international watercourses a legal claim to compensation. Operators of industrial installations will be liable for damage under the Protocol depending on the risk they pose, i.e. the quantities of hazardous substances present and their toxicity. Protocol will draw the attention of operators to the need to minimize risk and prevent damage that they will henceforth be liable for. February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 11
- 12. Draft Protocol on Civil Liability: Adoption The Protocol is expected to be formally adopted and signed at the forthcoming Ministerial Conference “Environment for Europe” in Kiev, Ukraine, on 21 May 2003. The successful results of these regional negotiations will be shared in March with a worldwide audience at the third World Water Forum in Kyoto, Japan. February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 12
- 13. Draft Protocol on Civil Liability: UNECE Website February 4, 2014 Bakhtiyor Mukhamadiev, Environmental Law, C 13
Editor's Notes
- UNECE is one of the five regional commissions of the UN, the primary goal of which is to encourage greater economic cooperation among its 55 member states. The members of the Commission include all of the European countries as well as countries of the former Soviet Union and Canada and USA in N.America. Among its other activities the Commission develops conventions, regulations and standards aimed at closer integration and cooperation of its member states between each other and among the rest of the members of the UN. The present Protocol is set to fill one of the major gaps in international environmental legislation, namely international civil liability for damage caused by industrial activities.
- There are a number of industrial accidents took place and some of them had a devastating impact on population as well as on the environment. Industry is a risky activity in itself even if you have implemented all the regulations on safety it still possesses threat to population and environment. And it takes long time to recover and requires a lot of money to mitigate the consequences. I have here the three accidents which had happened in Europe, they are: The Seveso accident happened in 1976 at a chemical plant manufacturing pesticides and herbicides. A dense vapour cloud containing tetrachlorodibenzoparadioxin (TCDD) was released from a reactor, used for the production of trichlorofenol. Commonly known as dioxin, this was a poisonous and carcinogenic by-product of an uncontrolled exothermic reaction. Although no immediate fatalities were reported, kilogramme quantities of the substance lethal to man even in microgramme doses were widely dispersed which resulted in an immediate contamination of some ten square miles of land and vegetation. More than 600 people had to be evacuated from their homes and as many as 2.000 were treated for dioxin poisoning. Levels of dioxin in the soils contaminated by the 1976 industrial accident in Seveso, northern Italy, are still 10 times higher than the level which the Italian parliament's agriculture committee considers safe for food production, according to Greenpeace. Soil tests found that dioxin levels were similar to those in 1982. "Nothing has been done to solve the problem of dioxin contamination in the area of the accident", says Greenpeace.The explosion and leak at a chemicals plant in Seveso in July 1976 spewed out poisonous dioxin, killing farm animals and causing skin diseases among people. Another example is a fire at chemical storage facility in Basel Switzerland ten years later. It released toxic chemicals into the Rhine River killing thousands of fish causing a great damage to the downstream riparians of the river – Germany, France and Netherlands. Following the accident the the riparians of the Rhine River decided to establish the International Commission on the Protection of the Rhine which is today is considered as one of the effective and powerful international river commissions. And recently, another major accident happened in Northern Romania. A breach of the tailings dam caused a release of cyanide rich waste into the river system. This was the case after which the countries decided to draw up the present protocol and therefore I would like to describe it in further detail.
- On 30 January 2000, a breach in the tailings dam of the Aurul S.A. Baia Mare Company, released some 100,000 m³ of cyanide-rich tailings waste into the river system near Baia Mare in north west Romania. This spill released an estimated 50-100 tonnes of cyanide, as well as heavy metals, particularly copper, into the Somes, Tisza and finally into the Danube Rivers before reaching the Black Sea. Auril S.A. is a stock company, jointly owned by Esmeralda, Exploration Limited, Australia, and the Romanian Compania Nationala a Metalelor Pretiosasi si Neferoase, established in 1992. The company processes solid wastes from earlier mining activity to recover precious metals, especially gold and silver. In 1993, the company obtained an environmental permit from the Ministry of Waters, Forests and Environmental Protection. In 1997, after receiving the Site Construction Permit from the Maramures County Council, construction of the recovering plant commenced. In 1999, the operational permit, based on an environmental impact assessment (EIA), was obtained. The company started operation in May 1999, by processing an existing 30 year-old tailings dam (Meda dam) located near Baia Mare, to the west and close to the residential area. The spill was described by Aurul S.A. as follows: After extreme weather conditions (ice and snow on the tailing pond, high precipitation of 36 L/m2), the tailings deposited on the inner embankment became soaked. Stability was affected, causing local displacement, and this subsequently developed into breach of approximately 23 m. The water released through the breach filled the area between the two embankments and spilled over the outer embankment. The volume of water released from the dam was estimated to be around 100,000 m3.
- TYPE OF INCIDENT Tailings dam crest failure after overflow caused from heavy rain and melting snow Release of some 100,000 m3 of cyanide-rich tailings waste contaminated with heavy metals IMPACTS Contamination of the Somes/Szamos stream, tributary of the Tisza River Contamination and interruption of the drinking water in 24 locations and of 2.5 million people Massive fishkill and destruction of aquatic species in the river systems Severe negative impact on biodiversity, the rivers' ecosystems, drinking water supply and socio-economic conditions of the local population Cleanup costs = N/A
- In less than 20 years 14 international legally binding instruments, five conventions and nine protocols, have been developed in the UNECE. These legal instruments play an important role as effective tools to promote active, direct and action-oriented international cooperation at the regional level. The Convention on Environmental Impact Assessment (EIA) in a Transboundary Context (Espoo, 1991) stipulates the obligations of Parties to assess the environmental impact of certain activities at an early stage of planning. It also lays down the general obligation of States to notify and consult each other on all major projects under consideration that are likely to have a significant adverse environmental impact across boundaries. The EIA Convention entered into force on 10 September 1997. 1992 Convention on the Transboundary Effects of Industrial Accidents. Entered into force 19 April 2000. Status as of 5 August 2002: Signatories 26 and Parties 25 . The aim of the Convention on the Transboundary Effects of Industrial Accidents is to help its Parties to prevent industrial accidents that can have transboundary effects, to prepare for them and to respond to them. The Convention also encourages its Parties to help each other in the event of such an accident, to cooperate on research and development, and to share information and technology . 1992 Convention on the Protection and Use of Transboundary Watercourses and International Lakes. Entered into force 6 October 1996. Status as of 23 July 2002: Signatories 26 and Parties 22. The Convention of the Protection and Use of Transboundary Watercourses and International Lakes (Water Convention) is intended to strengthen national measures for the protection and ecologically sound management of transboundary surface waters and groundwaters. The Convention obliges Parties to prevent, control and reduce water pollution from point and non-point sources. The Convention also includes provisions for monitoring, research and development, consultations, warning and alarm systems, mutual assistance, institutional arrangements, and the exchange and protection of information, as well as public access to information. The UNECE Convention on Access to Information, Public Participation in Decision-making and Access to Justice in Environmental Matters was adopted on 25th June 1998 in the Danish city of Aarhus at the Fourth Ministerial Conference in the 'Environment for Europe' process. The Convention entered into force on 30 October 2001 and progress of ratification is relatively rapid. The Aarhus Convention is a new kind of environmental agreement. It links environmental rights and human rights. It acknowledges that we owe an obligation to future generations. It establishes that sustainable development can be achieved only through the involvement of all stakeholders. It links government accountability and environmental protection. It focuses on interactions between the public and public authorities in a democratic context and it is forging a new process for public participation in the negotiation and implementation of international agreements.
- The Conference of the Parties to the UNECE Convention on the Transboundary Effects of Industrial Accidents (Industrial Accidents Convention) and the Meeting of the Parties to the UNECE Convention on the Protection and Use of Transboundary Watercourses and International Lakes (Water Convention), acknowledging that major industrial accidents may cause far-reaching transboundary effects including accidental releases into transboundary waters, decided that an intergovernmental negotiation process should be entered into aimed at adopting a legally binding instrument on civil liability for transboundary damage caused by hazardous activities, within the scope of both Conventions.
- There are two types of liabilities distinguished in the protocol. The first one relates to the actual damage caused as a result of industrial accident. And the second one, requires the operators of the industrial installations to maintain financial security to cover liability for amounts not less than the minimum limits for financial security. These securities can be in the form of, for example, insurance bonds or other financial guarantees, or by the financial mechanisms providing compensation in the event of accident. The Unit of Account means the special drawing right as defined by the IMF. The protocol provides further details on specific substances and they are divided into two broad parts: non-petroleum and petroleum products. Part I Substances are further classified as very toxic, toxic and substances that are dangerous for the environment. Part II Substances include petroleum products. For the purposes of defining the limits of liability the hazardous (industrial) activities are grouped into three different categories, according to their hazard potential. So, the followings are the fixed numbers so far for calculations of liability amounts, if it is proven that operator is liable to provide compensation. For instance, according to this table and given numbers if we try to calculate the liability amount for the above accident which took place in Romania where 100,000 m3 cyanide-rich wastes (100 tons of cyanide) were released to the river streams the amount will be 50 mln Units of Account (USD). In order to cover this amount the operator has to insure at least 12.5 mln.
- The Protocol gives individuals affected by the transboundary impact of industrial accidents on international watercourses, e.g. fishermen or downstream waterworks, a legal claim to compensation. Operators of industrial installations, including tailing dams, and pipelines, will be liable for damage under the Protocol depending on the risk they pose, i.e. the quantities of hazardous substances present and their toxicity. For instance, following an accident at an enterprise where more than 80 tons of very toxic substances, e.g. cyanides, are present, the company will be held liable for some US$ 50 million. To cover this liability, companies will have to establish financial securities, such as insurance or other guarantees. It is expected that the Protocol will draw the attention of operators to the need to minimize risk and prevent damage that they will henceforth be liable for. So it will help to prevent industrial accidents from happening in the first place and limit their adverse effects on people and the environment.