Spain launches legal proceedings against sunken tanker's insurers

Nov 21, 2002 01:00 AM

Spain said it has launched legal proceedings against the British insurers of the Prestige, an aged oil tanker which split in two and sank off the country's north-western coast, raising fears of environmental catastrophe. An official statement from Madrid said it had first contacted the London Steamship Owners Mutual Insurance Association (the London Club) about financial reparations, two days after the Prestige -- loaded with 77 000 tons of heavy fuel oil -- began listing and leaking oil.
"The government has launched legal action to seek damages and reparations against the ship owner and the insurer for damage done to the marine environment, fishing in Galicia and also for the enormous damages done to tourism," Spanish Justice Minister Jose Maria Michavila said.

Maritime officials in La Coruna, in northwest Spain, have also asked the London Club for a $ 60-mm guarantee in anticipation of damages that are expected to be reaped from government lawsuits against the ship owners, operators and the captain of the sunken tanker. The London Club is a "protection and indemnity" company which provides third-party liability insurance to ship owners, operators and charterers.
The Madrid government also said it had been in touch with the International Oil Pollution Compensation Funds (IOPC), which provides compensation for oil spills. IOPC, a London-based non-governmental agency created in 1992, offers compensation when a ship owner’s liability does not cover all of the damages from an oil spill.

The Prestige is owned by Mare Shipping, which is registered in Liberia, and administered the Athens-based Universe Maritime company. The 26-year-old single-hulled tanker is registered in the Bahamas. Such "flags of convenience" -- flags of a country other than the country of ownership -- have been cited as allowing ageing, substandard boats like the Prestige to stay afloat.
The Japanese-built tanker -- which appears not to have been inspected since 1999, when the ports of Rotterdam and New York both complained about security lapses -- is a single-hull vessel, a type which the European Commission wants to phase out of operations with upgraded safety standards.

Source: iafrica.com
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