Introduction

In early 2014, the Ministry of Transport sought public feedback on a proposal that New Zealand accedes to the Supplementary Fund Protocol, 2003. New Zealand’s accession to the Supplementary Fund Protocol, 2003, would give New Zealand access to compensation from the Supplementary Fund in the event of a major marine oil spill from an oil tanker. This would increase the compensation available to New Zealand from up to $377 million, to up to $1.392 billion.

Accession to the Supplementary Fund Protocol would provide New Zealand with access to a relatively inexpensive global insurance scheme. The costs associated with the Supplementary Fund Protocol are relatively minor, and are considered appropriate to the level of risk that New Zealand is exposed to from the transportation of oil.

The Supplementary Fund does not apply to offshore oil installations.

Background

The Supplementary Fund is part of the International Oil Pollution Compensation (IOPC) funds. The IOPC funds are intergovernmental conventions that provide three levels of compensation for oil pollution damage from marine oil spills from oil tankers.

New Zealand has acceded to the conventions for the first and the second level of the IOPC funds, which together provide compensation for oil pollution damage from oil tankers of up to $377 million in the event of an oil spill, regardless of fault.

The Supplementary Fund Protocol provides an additional level of compensation. The Supplementary Fund can provide up to $1.392 billion of compensation for marine oil pollution damage from oil tankers.

New Zealand’s accession to the Supplementary Fund Protocol, 2003, would require New Zealand to contribute to the Supplementary Fund when compensation is required. Contributions would be collected through a levy on the quantity of oil received by ship, and would be paid by New Zealand oil importers that receive more than 150,000 tons of oil per year.

Consultation and next steps

The consultation document [PDF, 2.3 MB] – New Zealand’s accession to the Supplementary Fund Protocol – provides background information about the Supplementary Fund Protocol.

Consultation on the Supplementary Fund Protocol closed on Friday 27 June 2014.

The Ministry of Transport is considered all submissions made on the consultation document, and provided advice to Cabinet in December 2014.

Cabinet approved accession to the Supplementary Fund Protocol on Monday 8 December 2014.

The Supplementary Fund Protocol will be presented to Parliamentary Select Committee for consideration (timetable to be confirmed)

Resources

View the Cabinet Paper: Approval to accede Supplementary Fund Protocol (December 2014) [PDF, 87 KB]

View the updated National Interest Analysis (December 2014) [PDF, 114 KB]

Read questions and answers

Read Texts of The 1992 Civil Liability Convention, the 1992 Fund Convention and the Supplementary Fund Protocol on the IOPC website (pdf 2.2mb) (external link)

Read more about Part 102 on the Maritime New Zealand website (external link) .

View the Consultation document [PDF, 2.3 MB]: New Zealand’s accession to the Supplementary Fund Protocol.

View the Cabinet Paper: Proposal to accede to the Supplementary Fund Protocol (May 2014) [PDF, 78 KB]

View the National Interest Analysis (May 2014) [PDF, 96 KB]

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Consultation on Marine Protection Rules Part 102