A Singaporean Ship Caught Fire in Sri Lankan Waters. Who Pays for the Environmental Damage?

Updated on 27th July, 2021.

The container ship X-Press Pearl lived a short life. The vessel entered service in February of 2021, setting sail from Malaysia. In May, while returning from its third voyage to Malaysia from Qatar, it caught fire. The suspect: a reaction between the many chemicals it was carrying. This blaze lit up Sri-Lanka’s shoreline for thirteen days and by late June, just four months after it had first set sail, the ravaged ship was sitting 70 feet below the Indian Ocean.

The environmental damage that this accident caused is slowly washing up on Sri Lanka’s beaches. Tonnes of small, white plastic pellets that the ship was carrying are now littered on the island’s sea shores and even in the gills and bellies of dead fish. Other cargo on the ship included chemicals like nitric acid, sodium dioxide, copper, and lead—all of which would not take long to enter human bloodstreams thanks to the wide consumption of fish here.

But, who is responsible for this pollution? After all, the characters in this story pan across nations—X-Press Pearl, a vessel owned and operated by a Singapore-based company, registered to the flag of Singapore, insured by a company in the United Kingdom, on its way to Malaysia from Saudi Arabia via India caused an environmental disaster for Sri Lanka. To add to these complexities, the crew became aware of the nitric acid—a “corrosive, toxic, and flammable liquid”—in early May when it was loaded on the ship in Dubai, but they were denied permission by Qatar and India to dock the ship there. This lack of cooperation between the concerned nations, along with limited offshore capacities to deal with the leak, made matters worse. The vessel then progressed into Sri Lankan waters, with its controversial cargo onboard. So, whose fault was the crisis?

There are no easy answers. “The question of liability depends on a case to case basis,” shares Ananya Mukherjee, an independent international maritime lawyer and researcher. “But, as lawyers, we would first break down which countries were involved in the accident, in what capacity, and the international conventions these countries have ratified and enforced. This is followed by putting together the factual details of the case in hand.”

Although chemical and oil spills at sea have dropped over the last 50 years, they still occur. As for oil spills alone, between 2010 and 2019, the world’s oceans recorded 54 oil spills where more than 7 tonnes of oil spilled into the Earth’s waters, harming marine life and coasts. For India, along whose coastline about 70% of the world oil demand is ferried, the threat of spills looms large. In this case, working towards a future where threats of oil and chemical spills do not become a frequent reality would not only require pinning accountability on countries, but also more collaborative efforts between them to prevent such accidents, instead of only reacting to them retrospectively. 

Laws of the Sea Lay Down Responsibility

“The civil liability of damages usually falls upon owners of the vessel, in case of pollution,” Mukherjee shares, implying that flag states are not always held liable. In other words, the company that owns the vessel and the country to which the vessel is flagged—or registered in—can be two different ones.

This is possible through ‘Flags of Convenience’, a practice that allows owners to register their vessel in a different country. Upon registration, the vessel operates and is taxed under the laws of the country where it is registered. A popular Flag of Convenience choice is Panama, where the labor costs are cheap, marine regulations are much less stringent, and foreign owners don’t have to pay income tax. As of 2019, 9,367 vessels in the world were flying Panama’s flag, ranking it as the top choice for Flag of Convenience—which is almost 4500 vessels ahead of the country’s next competitor, China. 

Now, for such flag states, the United Nations Convention on the Law of the Sea, 1982 (UNCLOS)—an international agreement that defines the roles and responsibilities of using the world’s oceans—enforces a number of responsibilities on the countries that ratify it and flag states. These responsibilities include ensuring that vessels comply with the applicable rules and standards of the registered state, periodic inspections of the vessels, and prohibiting vessels from flying their flags in cases of noncompliance.

But, UNCLOS in and of itself does not hold flag states liable in cases of pollution violations. 

Take for instance MV Rak, a vessel that sank 20 nautical miles offshore of Mumbai in 2011—causing heavy damage with oil spills and tar balls gracing India’s northwest coast. It was on its way to Indonesia from Gujarat. Five years later, the National Green Tribunal fined the owners of the ship—based in Panama and Qatar—₹100 crore for environmental damages. Adani Enterprises, whose cargo the ship was carrying, was charged ₹5 crore too. In the case involving X-Press Pearl, on the 14th of July, the vessel’s operators paid the Sri Lankan government an initial payment of $3.6 million against the $300 million USD in damages that it had sought. Discussions on this payment are ongoing. 

“Domestic cases are fairly easier to deconstruct and hold parties liable,” Mukherjee comments. Mukherjee is referring to those accidents that occur within a country’s territorial waters (12 nautical miles or 21 kilometres into the sea) upto Exclusive Economic Zones (200 nautical miles). “But in the high seas, which are considered a “common heritage of all mankind”, a country’s jurisdiction gets murkier. Parties that can be held liable or compensated, as well as the extent of such damage caused, becomes a much more complex issue where geopolitics also plays a key role.”

Since multiple parties are at play, the UNCLOS facilitates the need for “international communication,” especially in case of polluting events in the ocean. 

Cross-Border Collabs to Prevent Pollution, Not Just React to It

To mitigate ocean pollution, Section 3 of the UNCLOS suggests cooperation mechanisms between countries for several purposes: such as preserving marine life, notifying nearby nation states of an imminent polluting disaster, or eliminating the impacts of pollution through contingency plans. This is also reflected in India’s National Oil Spill Disaster Contingency Plan, developed in 2015 as an obligation under the UNCLOS. Not only does the Plan facilitate the import of overseas equipment and personnel in case India requires it during an environmental accident at sea, but it also extends a helping hand to neighbouring countries in the case of oil spills in their waters. 

Such high-level consultation and cooperation was on display in the case of X-Press Pearl’s accident too: the Indian Coast Guard sent 3 ICG ships into Sri Lanka’s water for the joint “Sagar Aaraksha-II” operation, to douse the blazing vessel. “As a member State of the South Asia Co-operative Environment Programme (SACEP), India is keen to extend assistance to SACEP maritime countries and other countries of the Indian Ocean Region,” a representative of Indian Coast Guard (ICG) informs The Bastion . “Under SACEP’s umbrella, international collaboration with Pakistan, Bangladesh, Sri Lanka, and Maldives is already in place.”

“Protecting territorial waters is a matter of protecting sovereignty. So, the activation of international coordination between concerned agencies is relatively quick in the case of polluting accidents at sea involving international entities,” says Aarthi Sridhar, Founder Trustee of Bengaluru-based Dakshin Foundation.

Help on way! Responding promptly as ever to the request by #SriLanka, #India dispatches #ICGVaibhav, #ICGDornier and Tug Water Lilly for fighting the fire on MV X Press Pearl off Colombo.@MFA_SriLanka pic.twitter.com/x9D9XyrkyJ

— India in Sri Lanka (@IndiainSL) May 25, 2021

Apart from collaboration already in place, ICG has also signed a Memorandum of Understanding with neighbouring friendly countries to respond to any oil spills occurring in their Area of Responsibility. “We also provide training on marine pollution response through conduct of IMO level courses and PR exercises. ICG’s Maritime Rescue Co-ordination Centres also act as the international emergency response centres in the Indian Ocean Region,” informs the ICG representative.

But, most of this coordination and collaboration happens post the accident, and is a reactive stance. “A reactive action towards ocean pollution is bound to fall short,” says Siddharth Chakravarty, an independent researcher working on fisheries and a former merchant navy navigator. “After an accident, fires can be doused [as in the case of X-Press Pearl], but the ecological damage of a chemical leak would have already happened.” A preventive mechanism would require countries to have off-shore capacities in place, which would allow them to deal with leaks on ships—especially those carrying hazardous cargo. In the case of X-Press Pearl, both India and Dubai did not possess such facilities, which explains why they did not allow the ship to dock, the consequences of which are clear. 

“As preventive methods, ICG issues directives to ports and oil handling agencies to augment their pollution response equipment inventories to deal with any inadvertent oil spills,” says the ICG representative. “But, we are of the firm view that more preventive measures like pollution response exercises, seminars, workshops, and training sessions need to be conducted in order to build a robust and effective preventive mechanism for oil spills at sea.”

Building these capacities is essential and would require skill training and better technology which can be garnered through inter-governmental collaborations. 

Some nations have been successful in creating off-shore capacities. The United States, under its Oil Pollution Act of 1990, makes vessels entering US waters responsible for acquiring a Certificate of Financial Responsibility. The certificate acts as proof of the vessel’s ability to be able to pay for clean-up and damages in case an oil spill occurs, no matter which flag the vessel may belong to. “When the world’s richest country offloads the cost of clean-ups via such a stringent mechanism, it is only logical to extend this mechanism to other nations so they do not have to bear the financial burden of the clean-ups via their already stressed financial conditions,” Chakravarty adds.

This might be easier said than done. After all, setting up a preventive mechanism that requires skills, technology, and human resources requires funds that many nations in the Indian Ocean Region might not have. “The littoral nations of the Indian Ocean Region are all developing nations (discounting Singapore),” shares Aarthi. “Investing in sustained marine (or shipping related) pollution prevention measures, is considered somewhat of a luxury for their governments. I can’t see it being a priority investment for any of these coastal nations’ governments right now–not at the scale at which it will actually be effective. Instead, states prefer to invest in collaborative defence and security-related preventive exercises which are of higher priority, in a geopolitically charged space like the Indian Ocean.”

In the same vein of maintaining security and other maritime issues in the Indian Ocean, the Indian Navy conceived the Indian Ocean Naval Symposium (IONS) in 2008. By organising annual fora for discussions, IONS seeks to enhance maritime cooperation for security purposes, and maintain friendly relations amongst the navies of the littoral states of the Indian Ocean Region. It has 24 member states, including six from South Asia. But it is an open secret that such collaborations are partly geo-political in nature.

“There are cross-border collaborations for conservation as well, but I still remain skeptical of their impact,” shares Kartik Shanker, faculty at the Indian Institute of Science, Bangalore, and Founding Trustee of Dakshin. Shanker points towards one such collaborative effort, IOSEA Marine Turtles, a 2001 Memorandum of Understanding between countries in the Indian Ocean and Southeast Asia to conserve and manage marine turtles. “At best, these have helped spread some degree of awareness of sea turtles in government and led to the development of national action plans (which aren’t implemented). Over the years, though, the MoU has likely achieved less than 10% of the goals they set out in the beginning.”

“While UNCLOS and the International Maritime Organization push for collaboration, very localised, granular information can be lost in the text on global agreements on liability, damage and compensation,” says Aarthi. “This granular data is however very important to give life to these agreements, especially in cases of compensation for coastal communities for the environmental impacts that a ship accident may have caused. It helps answer questions of the nature and degree of environmental damage, which will help decide the compensation and liability.” 

The government may not always have the bandwidth to conduct such long-term, low-scale  monitoring. Then, to monitor pollution and ecological health, inter-border collaboration shouldn’t be limited solely to the government; Civil Society Organizations too could do the same. 

Take for instance, fly-ash accidents that occur along the inland Indo-Bangladesh Protocol Route. 97 percent of the trade along this route carries this toxic byproduct of coal. Many vessels have also capsized in transit, leaking the fly-ash out into the surroundings that include the ecologically sensitive Sunderban mangroves. To keep track of such accidents, Manthan Adhyayan Kendra, a research organisation, created an interactive tracker.

Questioning Global Inequalities of Shipping

Pollution accidents in the oceans—and how countries are able to manage them—also reveal the unequal revenue distribution that shipping generates between the Global North and South. “Insurers, charterers, and owners of ships are usually placed in the Global North, but the vessel manufacturers are in East Asia, and the crewmembers of the ship, or those who would recycle parts of old ships, are from South Asia,” Chakravarty points out. Revenue is skewed in favour of the Northern countries: as of 2019, Greece, Japan, Norway, and Germany are a few of the top ten shipowning nations of the world, while most of the officers on the ships come from China, Philippines, and India.

“Now, when pollution accidents occur in the ocean routes of the Global South, then the countries which already share less profit from global shipping business are left to fend for themselves,” Chakravarty adds. “We have to begin by acknowledging that the shipping industry today started out as a means for the global colonial conquest of the British Empire. Inequalities are thus built into this model and to share the costs of ship-based pollution, a redistribution of the profits has to be undertaken.” 

Trade along the ocean routes will only increase in the future. Accidents are almost inevitable. But, a strong regional and cross-border collaboration between governments and civil society organisations can help prepare them better. After all, oceans are one of the largest commons in the world, and would benefit from a common goal of collaboration.

Featured image: the Indian Coast Guard dousing a fire on a ship in 2020; courtesy of the Indian Coast Guard (Government Open Data Licence-India GODL).