06/2004 - Japan - Compulsory insurance requirements on nontank vessels

Circular No. 6/2004 December 2004

TO THE MEMBERS OF ASSURANCEFORENINGEN GARD -gjensidig-

Dear Sirs

Japan - Compulsory insurance requirements on nontank vessels

From 1st March 2005, in accordance with the newly amended Japanese Law on Liability for Oil Pollution Damage, all ocean-going non-tanker vessels of 100 gross tons or more must comply with the requirements of compulsory insurance when calling at a Japanese port.

Liability

The English version of the amended Law on Liability for Oil Pollution is not available. However the Japan Ministry of Land, Infrastructure and Transport (MLIT) has posted a summary on its website from which it is clear that the new law imposes strict, joint and several liability on the shipowner and charterer of the vessel for damage caused by a bunker spill.

Insurance

MLIT’s summary announcement indicates that insurance required under the new law must include coverage for damage caused by bunker pollution and coverage for the expenses of wreck removal. The amounts of insurance cover must be sufficient to meet both personal claims and other claims in accordance with the limits provided under the 1976 Limitation of Liability for Maritime Claims (LLMC).

Charterers - which may include time charterers but not voyage charterers - are also liable under the law. However MLIT has confirmed that if the owner has a Club Certificate of Entry on board the vessel, the charterer will not be required to supply another insurance certificate.

What Members should do in order to comply with the new requirements?

1. Carry the relevant original certificate of insurance on board

For owners insured with any of the International Group of P&I Clubs, the Club’s Certificate of Entry will be accepted. However the Certificate of Entry must be an original.

1. Report the status of insurance before entering a port or certain designated sea areas

A report form must be filled out and faxed to the relevant District Transport Bureau before noon on the previous working day before the entry of the vessel in a Japanese port or entry into certain designated sea areas, these being Tokyo Bay, Isewan Bay and the Inland Sea. (For details of the bureaux and the report form when it is available, visit MLIT’s website). MLIT’s announcement appears to indicate that this notification requirement also applies to CLC tankers.

This circular provides preliminary advice in response to queries from Members, but as noted above, since an English version of the law is not available, Members are encouraged to visit the MLIT website for updated information and to download the report form, when it is made available. The website also includes the MLIT’s contact details and can be found at the following address: http://www.mlit.go.jp/english/maritime/insurance_portal3eng.htm.

Summary

• This is a preliminary advice on new insurance requirements for non-tanker vessels trading to Japan.

• These requirements will be effective from 1st March, 2005.

• The requirements can be met by keeping an original Club Certificate of Entry on board and by reporting the status of insurance before entering a Japanese port or certain designated sea areas

If you have any questions, please contact the P&I underwriting department.

Yours faithfully, GARD AS As agent only for Assuranceforeningen Gard -gjensidig-

Chief Executive Officer