limitation of liability for maritime claim (LLMC)

Convention on Limitation of Liability for Maritime Claims (LLMC), 1976

Adoption: 19 November 1976
Entry into force: 1 December 1986

Introduction
Protocol of 1996
Special drawing rights

Introduction

The Convention replaces the International Convention Relating to the Limitation of the Liability of Owners of Seagoing Ships, which was signed in Brussels in 1957, and came into force in 1968.

Under the 1976 Convention, the limit of liability for claims covered is raised considerably, in some cases up to 250-300 per cent.  Limits are specified for two types of claims - claims for loss of life or personal injury, and property claims (such as damage to other ships, property or harbour works).

In the Convention, the limitation amounts are expressed in terms of units of account.  Each unit of account is equivalent in value to the Special Drawing Right (SDR) as defined by the International Monetary Fund (IMF), although States which are not members of the IMF and whose law does not allow the use of SDR may continue to use the old gold franc (referred to as "monetary unit" in the Convention).

With regard to personal claims, liability for ships not exceeding 500 tons is limited to 330,000 SDR (equivalent to around US$422,000). For larger vessels the following additional amounts are used in calculating claims:

For each ton from 501 to 3,000 tons, 500 SDR (about US$640)

For each ton from 3,001 to 30,000 tons, 333 SDR (US$426)

For each ton from 30,001 to 70,000 tons, 250 SDR (US$320)

For each ton in excess of 70,000 tons, 167 SDR (US$214)

For other claims, the limit of liability is fixed at 167,000 (US$214,000) for ships not exceeding 500 tons.  For larger ships the additional amounts will be:

For each ton from 501 to 30,000 tons, 167 (US$214).

For each ton from 30,001 to 70,000 tons, 125 SDR (US$160)

For each ton in excess of 70,000 tons, 83 SDR (US$106)

The Convention provides for a virtually unbreakable system of limiting liability.  It declares that a person will not be able to limit liability only if "it is proved that the loss resulted from his personal act or omission, committed with the intent to cause such a loss, or recklessly and with knowledge that such loss would probably result".

Protocol of 1996

Adoption: 3 May 1996

Entry into force: 90 days after being accepted by 10 States.

Status: See status of conventions.

The Protocol will result in the amount of compensation payable in the event of an incident being substantially increased and also introduces a "tacit acceptance" procedure for updating these amounts.

For ships not exceeding 2,000 gt, liability is limited to 2 million SDR (US$2.56million) for loss of life or personal injury and 1 million SDR (US$1.28 million) for other claims.

Liability then increases with tonnage to a maximum above 70,000 gt of 2 million SDR (US$2.56 million) + 400 SDR (US$512) per ton for loss of life or personal injury and 1 million SDR  (US$1.28 million) + 200 SDR (US$256) per ton for other claims.

Special Drawing Rights

The daily conversion rates for Special Drawing Rights (SDRs) can be found on the International Monetary Fund website at http://www.imf.org/