Liability and compensation for oil spill accidents: International regime and its implementation in China

Marine oil spill accidents have long been caused by ship collisions. However, the proliferation of offshore oil and gas installations portends a marked increase in oil spills from these sources. This presents a unique enforcement challenge for international and Chinese domestic systems for oil pollution liability and compensation that were developed in response to the threat of ship-based oil pollution. This article focuses on how the international liability and compensation regime for oil pollution has been implemented in China, and whether a combination of the international regime and domestic Chinese regulations could provide an adequate mechanism for holding offshore oil operators liable for accidents and for ensuring adequate compensation to injured parties. Analysis of Chinese law demonstrates that the current international liability and compensation regime for oil pollution, the 1992 Civil Liability Convention (CLC)–International Oil Pollution Compensation (IOPC Funds), has been only partially implemented in China and lacks domestic adaptation mechanisms. The CLC–IOPC Funds regime also does not extend to oil pollution accidents resulting from offshore operations. An international convention containing universal liability provisions for offshore oil spill accidents would require a long-term process of joint international efforts. Based on this international and domestic Chinese legal environment, this article concludes that China should first develop a domestic liability and compensation mechanism that implements the international regime for ship-source oil pollution in its entirety, but which also extends to pollution caused by offshore oil spills