HNS Convention 2010: liability for hazardous substances

Background: the gap between CLC and HNS-cargo incidents

The international maritime liability regime that emerged after Torrey Canyon 1967 addressed only persistent oil cargo from oil tankers. CLC 1969 and its 1992 Protocol channelled strict liability to the registered shipowner of a tanker carrying crude oil, fuel oil, heavy diesel oil, or lubricating oil. The IOPC Fund layered supplementary compensation financed by oil receivers above the shipowner’s per-ton cap. The two-tier framework gave coastal States a politically tractable, polluter-pays solution to the largest single class of marine pollution casualties, and by 2026 the CLC plus IOPC plus Supplementary Fund stack covers a single oil pollution incident up to 750 million SDR.

The CLC and IOPC architecture excluded by design every other class of marine cargo capable of causing comparable casualty damage. Chemicals carried in bulk under the IBC Code, liquefied gases carried in bulk under the IGC Code (LPG, LNG, ethylene, ammonia, vinyl chloride monomer, propylene, butadiene), bulk solid HNS such as sulphur, ammonium nitrate, direct reduced iron, and sodium hydrosulfide, and packaged dangerous goods carried under the IMDG Code in containers and reefer units all fell outside any compensation convention. A coastal State faced with a chemical tanker casualty had to recover under domestic tort law, with the practical consequence that the registered owner’s P&I cover was the only recoverable layer above LLMC limits, and the global fund layer that oil benefited from was simply absent.

The mismatch became visible whenever a major HNS casualty occurred. The MSC Napoli 2007 off Devon released packaged dangerous goods including pesticides, perfumes, and battery acid, with cleanup costs exceeding the registered owner’s LLMC fund. The Cheshire 2017 ammonium nitrate cargo fire and the Sanchi 2018 Iranian condensate casualty, each falling outside CLC because the cargo was non-persistent or non-oil, demonstrated the persistent gap. A hypothetical casualty involving equivalent volumes of acrylonitrile, vinyl chloride, or ammonia would leave the coastal State exposed to costs an order of magnitude beyond the LLMC ceiling with no fund recourse. The 2010 Protocol exists to close that gap.

1996 HNS Convention origin and ratification failure

The IMO opened diplomatic work on an HNS instrument in the late 1980s after the Bahia Paraiso 1989 chemical tanker grounding in Antarctica. After several years of drafting through the IMO Legal Committee, the International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea, 1996 was adopted at a diplomatic conference at IMO London on 3 May 1996. The substantive architecture closely paralleled CLC and IOPC: strict liability of the registered shipowner up to a tonnage-based cap, supplementary compensation from a fund financed by HNS receivers, compulsory insurance evidenced by a State-issued certificate, and a single-forum jurisdiction rule.

The 1996 Convention required for entry into force ratification by 12 States including 4 States with not less than 2 million units of gross tonnage, plus a contribution-receipts threshold tied to the prospective Fund’s contributor base. The convention attracted only a handful of full ratifications over the following decade. Several major prospective contributor States, notably Canada, the United Kingdom, the Netherlands, Norway, France, Greece, and Germany, identified consistent practical objections to the contributor-account mechanics rather than to the underlying liability principle. The most acute objection concerned the treatment of packaged HNS received in bulk container terminals: the 1996 text required receivers of packaged HNS to file annual returns and contribute to the Fund on a per-tonne basis, but in practice container line carriers delivered consignments whose chemical content was not visible to the terminal operator, and shipper-supplied dangerous goods declarations were inconsistently recorded. Receiving States feared that imposing contribution liability on container terminals or on small downstream consignees would be administratively unworkable and politically unsustainable.

The 1996 Convention also tied the LNG account to the title-holder of the cargo at the moment of discharge rather than to the receiver of the cargo at the terminal. In LNG trade the title flow at discharge frequently differs from the physical receiver under sale-and-purchase agreements concluded years before delivery, and several governments concluded that title-based contribution would be impossible to administer through customs records. By 2008 the 1996 Convention had eight ratifications, none from the major prospective contributor States, and the IMO Secretariat concluded that the Convention as drafted could not enter into force without structural amendment.

2010 Protocol re-engineering of the contributor architecture

A diplomatic conference at IMO London adopted the Protocol of 2010 on 30 April 2010. The Protocol does not replace the 1996 Convention; it amends it and is read together with it. The combined instrument is referred to in IMO documents as the HNS Convention 2010 and that nomenclature is used throughout this article.

The 2010 Protocol made three structural amendments aimed at making ratification politically tractable for receiving States. The packaged HNS exclusion from contribution removed the obligation on receivers of packaged HNS to file contribution returns; packaged HNS remains within the liability scope of the Convention so claims for packaged HNS damage can still be paid from the Fund, but the Fund is financed only from contributions on bulk HNS. The LNG account contributor was redefined from the title-holder at discharge to the receiver of the LNG, that is the entity taking physical delivery of LNG at the import terminal in the State Party. The non-submission penalty was clarified so that a State Party that fails to submit annual contribution data triggers loss of compensation entitlements for claimants resident in that State, providing a practical compliance lever.

The 2010 Protocol left the liability tiers, caps, geographical scope, and channelling rules of the 1996 text largely intact. The drafting committee took the view that the substantive liability architecture had broad support and that the obstacle to ratification was administrative, not principled. The Protocol entry-into-force formula remained the same: 12 States including 4 States with not less than 2 million units of gross tonnage, plus aggregate annual contribution receipts of at least 40 million tonnes of contributing cargo across the LNG, LPG, oil, and General accounts.

Entry-into-force status as of 2026

The HNS Convention 2010 is not in force. This is the single most important operational fact about the regime: every reference to HNS Certificates, Blue Cards, Fund contributions, and per-incident ceilings describes the architecture that will apply once the entry-into-force threshold is crossed, not current operative requirements.

The IMO Secretariat and the IOPC Funds HNS portal track ratification progress. The entry-into-force formula requires: (a) ratification by at least 12 States, including (b) at least 4 States each with not less than 2 million units of gross tonnage, and (c) aggregate annual HNS contribution receipts of at least 40 million tonnes across all Fund accounts from the ratifying group. The three conditions are conjunctive; meeting two of three does not trigger force.

As of early 2026, the ratification count stands well below the 12-State threshold. The group of ratifying States has not yet included any of the major tonnage States or the major HNS-receiver States that would satisfy conditions (b) and (c). The IMO Legal Committee has repeatedly encouraged ratification, and the European Union’s Council Decision (EU) 2018/313 of 6 March 2018 authorised EU Member States to proceed with ratification in the Union’s interest. Despite that authorisation, fewer than half of EU Member States had completed domestic implementing legislation as of early 2026. The trajectory through the IMO Legal Committee’s annual progress reviews suggests entry into force is a medium-term prospect contingent on coordinated ratification by Norway, Canada, the UK, the Netherlands, or France.

Until entry into force, the Convention creates no rights and no obligations. Coastal States facing HNS casualties fall back on national tort law, bilateral agreements, and P&I Club voluntary settlements. The gap that the Convention was designed to close remains open.

Scope: HNS defined by cross-reference to IMO carriage lists

The Convention defines hazardous and noxious substances by cross-reference to a series of IMO instruments rather than by an in-text chemical list. The definition captures any substance referenced in:

• The MARPOL Annex I Appendix I list of oils, where carried as cargo in bulk.
• The MARPOL Annex II IBC Code list of noxious liquid substances carried in bulk.
• The MARPOL Annex III IMDG Code list of harmful substances in packaged form, governed by MARPOL Annex III.
• The IBC Code Chapter 17 list of dangerous chemicals carried in bulk.
• The IGC Code product list, covering bulk liquefied petroleum gas (LPG, ethylene, propylene, butadiene), bulk liquefied natural gas (LNG), bulk liquid hydrogen (LH2), bulk anhydrous ammonia, bulk vinyl chloride monomer, and bulk chlorine.
• The IMSBC Code Group B list of bulk solid HNS, covering sulphur, ammonium nitrate, ammonium nitrate-based fertilisers, direct reduced iron in fines or briquettes, coal subject to self-heating, sodium hydrosulfide, and petroleum coke at elevated temperature.

The cross-reference architecture means that the HNS scope automatically expands as IMO updates the underlying lists. A new chemical added to the IBC Code Chapter 17 list at MEPC by tacit amendment becomes an HNS substance at the next entry into force of the IBC amendment without any further diplomatic action under the HNS Convention itself.

The Convention covers damage caused by HNS in four heads:

• Loss of life or personal injury on board the ship or external to it.
• Loss of or damage to property external to the ship.
• Loss or damage by contamination of the environment, with reasonable measures of reinstatement.
• The costs of preventive measures taken to prevent or minimise damage, and any further loss or damage caused by such preventive measures.

The personal-injury head is a significant departure from CLC. Crew and salvor personal-injury claims arising from a chemical exposure or LPG vapour cloud explosion are recoverable under HNS, whereas CLC limits compensation to property damage and pollution-damage measures.

Carve-out from CLC scope

The HNS Convention explicitly excludes pollution damage as defined in CLC 1992. The carve-out is operative in Article 4(3) of the consolidated text and prevents double-counting of any loss between the two regimes. Persistent oil cargo from a tanker is governed by CLC and IOPC; non-persistent oil cargo, chemicals, gases, packaged HNS, and bulk solid HNS are governed by HNS. A single ship can fall within either regime depending on the cargo carried at the time of the incident: a product tanker on a gasoline voyage falls within HNS; the same ship on a fuel oil voyage falls within CLC. A chemical tanker carrying a parcel cargo of paraxylene plus heavy fuel oil bunkers falls within HNS for the cargo and within the Bunkers Convention 2001 for the bunker fuel.

The carve-out resolves the difficult cases that arose under the 1969 CLC. Non-persistent oil products (gasoline, jet fuel, kerosene, naphtha, gas oil) were excluded from CLC because they dissipate rapidly and were thought to cause only short-lived pollution. Casualties such as Multitank Ascania 1999 and Tasman Spirit 2003 showed that non-persistent oil casualties can produce significant air-quality, fire, and explosion damage, and HNS extends compensation to those events.

Tier 1: shipowner strict liability with tonnage-based cap

Article 7 of the consolidated HNS Convention imposes liability on the owner of the ship at the time of the incident for damage caused by HNS in connection with their carriage by sea. Owner is defined as the registered owner in the ship’s flag State register; bareboat charterers are not the owner of record. The liability is strict: the claimant need not prove fault. Channelling protects the master, crew, pilot, salvor, and charterer from parallel claims. Defences are limited to act of war, hostilities, civil war, insurrection, exceptional natural phenomenon of an irresistible character, and acts of third parties intended to cause damage.

Article 9 sets the owner’s limit of liability on a tonnage-based sliding scale. The piecewise cap is:

A 2,000 GT chemical tanker faces a Tier 1 cap of 10 million SDR. A 25,000 GT product tanker faces 45.5 million SDR. A 50,000 GT VLGC LPG carrier reaches 82 million SDR at the calculation point within the linear segment, and every ship above 50,000 GT hits the 100 million SDR ceiling. A 145,000 GT QFlex LNG carrier or 260,000 GT VLEC ethane carrier both face the 100 million SDR cap. The ceiling is per incident, not per claim, and is constituted in court by depositing the limitation fund with the competent tribunal of any State Party where an action has been brought.

Compulsory insurance is required for every ship actually carrying HNS, regardless of cargo volume. The 2,000-tonne threshold that limits CLC compulsory insurance to substantial cargoes does not apply under HNS. Every laden chemical tanker, gas carrier, and product tanker, plus every cargo ship carrying packaged HNS or bulk solid HNS, requires a State-issued HNS Certificate backed by a P&I Club Blue Card. The compulsory insurance scope is therefore considerably broader than CLC in terms of the number of ships affected.

Tier 2: HNS Fund supplementary compensation up to 250 million SDR

Where damages exceed the Tier 1 owner cap, the HNS Fund provides supplementary compensation. The aggregate ceiling for owner plus Fund compensation is 250 million SDR per incident. That figure is fixed in the Convention text and combines Tier 1 owner liability and Tier 2 Fund payment into a single per-event ceiling.

The Fund is a separate international legal person established by the Convention with a Secretariat that the IMO Council assigns for administrative co-location with the IOPC Funds Secretariat in London. The Fund’s legal independence from IOPC is preserved: contributions are not co-mingled, and an incident’s claims do not draw on IOPC reserves or vice versa. The administrative co-location is a cost-efficiency arrangement that allows existing IOPC technical staff to handle HNS claims processing under separate accounts.

The Fund pays where the owner is exempt from liability under Article 7 defences, where the owner is financially incapable of meeting Tier 1 liability and the insurance is for any reason unavailable, or where the claims exceed the Tier 1 cap. The Fund’s right of recourse runs against the owner and the owner’s insurer for any payment the Fund makes that is properly the owner’s responsibility, and the Fund routinely subrogates against P&I Clubs once Tier 1 cover is exhausted.

Four contributor classes: General, Oil, LNG, LPG accounts

The Fund is financed by four separate accounts corresponding to four cargo classes. The account architecture prevents cross-subsidy between classes: an LNG casualty draws first on the LNG account, an LPG casualty on the LPG account, and so on, with the General account providing residual coverage if a class account is depleted.

The General account threshold is structured as an aggregate of bulk solid plus bulk liquid HNS receipts. A receiver below threshold in any single category may still be liable to contribute if the aggregate of bulk solid plus bulk liquid receipts crosses 20,000 t. The Oil account threshold replicates the IOPC Fund threshold, allowing oil receivers in States Party to both regimes to use a single tonnage figure. The LNG account has no minimum because LNG cargoes are large and concentrated; every LNG receiver in a State Party is a contributor. The LPG account threshold of 20,000 t excludes small LPG receivers serving rural distribution markets but captures every commercial LPG terminal.

The contributor is the physical receiver of the cargo at the import terminal, that is the entity taking physical delivery from the discharging ship. Title flow under the sale-and-purchase agreement is irrelevant; the regime works from physical receipts as recorded in customs and port statistics.

Contributor levy mechanics

The HNS Fund Secretariat calculates an annual levy in two cases. General contributions are levied annually to fund the Fund’s administrative costs, an emergency reserve, and projected claims arising from incidents already reported. Initial contributions are levied on entry into force to capitalise the Fund and to enable claims processing in the first calendar year. The General Assembly of the Fund sets the per-tonne rate for each account each year by Assembly resolution.

The levy calculation for each account A in {General, Oil, LNG, LPG}:

1. The Assembly approves the budget for year Y consisting of administrative costs, emergency reserve, and projected payouts.
2. The rate per tonne for account A in year Y is rate_A_Y = budget_A_Y / total_receipts_A_Y_minus_1.
3. The per-receiver levy for receiver R in account A in year Y is levy_R_A_Y = rate_A_Y * receipts_R_A_Y_minus_1.
4. The State Party submits annual returns from each receiver above threshold by 30 April each year.
5. The Fund issues invoices to receivers by 31 May; receivers pay direct to the Fund Secretariat.

A typical projected per-tonne rate at steady-state operation is in the range of 0.0005 to 0.005 SDR per tonne for the Oil and General accounts, with higher rates for the LNG and LPG accounts in active claims years. The rates are not fixed in the Convention text and vary year-on-year as claims and reserves require.

The State Party must collect annual return data from receivers and submit the data to the Fund Secretariat. Failure to submit returns triggers the non-submission penalty clarified by the 2010 Protocol: claimants resident in the non-reporting State lose the right to compensation from the Fund for any incident occurring during the non-reporting period. The penalty is severe enough to incentivise diligent reporting even where the underlying receivers are politically reluctant.

Political resistance: Canada, Norway, and major tonnage States

Three categories of State have shown sustained reluctance to ratify the 2010 Protocol despite the structural improvements over the 1996 text.

Canada is a major LNG and LPG exporter with growing import receipts on the Atlantic seaboard via Saint John and Quebec. Canada was a constructive participant at the 2010 conference and has a stated ratification policy. Canadian implementing legislation has been introduced multiple times without progressing to royal assent. Canada’s contribution share if ratifying would be material because of LPG imports from US Gulf and Persian Gulf sources.

Norway is among the largest LNG and LPG receivers in northern Europe via Mongstad and Karsto, and a substantial bulk chemical receiver. Norwegian class society interests support ratification; receiving-side commercial interests have objected on the basis that the per-tonne levy on LNG receivers is uncertain and could be material in a major-claim year. As of 2026 Norway has not ratified.

A second tier of slow-ratifying States includes Greece, India, Japan, Korea, and Brazil, each with substantial fleet ownership or HNS receipts but with domestic political timelines that have not aligned with the ratification requirement. The collective effect is that, as of 2026, the ratification count remains well short of the 12 required, and contribution receipts in the ratifying States remain well short of the 40 million tonne aggregate threshold. No large-tonnage State satisfying condition (b) of the entry-into-force formula has ratified.

Relationship to CLC 1992 (cross-link)

The HNS Convention and CLC 1992 are designed as complementary regimes covering disjoint cargo classes. CLC covers persistent oil cargo from oil tankers; HNS covers everything else of HNS character. The carve-out in HNS Article 4(3) ensures that a single incident cannot trigger compensation from both regimes for the same loss head.

A product tanker is the operative test case. The same ship on a heavy fuel oil voyage from Rotterdam to Singapore falls within CLC because heavy fuel oil is persistent oil cargo. The same product tanker on a gasoline voyage between the same ports falls within HNS because gasoline is non-persistent oil and excluded from CLC. The compulsory insurance certificates required on board are correspondingly different: CLC Certificate for the heavy fuel oil voyage, HNS Certificate for the gasoline voyage. Practical operators carry both certificates concurrently to avoid mid-voyage gaps.

The Tier 2 fund layers operate separately. The IOPC Fund and Supplementary Fund are financed by oil receivers under CLC architecture; the HNS Fund is financed by the four-account contributor base under HNS architecture. The Oil account of the HNS Fund overlaps in receiver identity with IOPC contributors, but contribution thresholds and rates are calculated independently and contributions are not interchangeable between the two Funds.

Relationship to Bunkers Convention 2001 (cross-link)

The Bunkers Convention 2001 covers bunker oil pollution from non-tanker ships, with strict liability of the registered shipowner subject to LLMC limitation. The relationship with HNS is operative when a non-tanker ship carries HNS cargo and discharges both bunker fuel and HNS in a single incident.

The X-Press Pearl 2021 case is the canonical example. The container ship caught fire and sank off Colombo in May 2021 with a cargo manifest including 1,486 metric tons of plastic nurdles, 25 metric tons of nitric acid, sodium methoxide, methanol, ethanol, and lead ingots, plus approximately 350 metric tons of fuel oil and gas oil bunkers. Had both Conventions been in force in Sri Lanka, bunker oil pollution would have been compensated under the Bunkers Convention and HNS cargo damage (nurdle pollution, fisheries contamination, beach restoration) under HNS up to the 250 million SDR Tier 2 ceiling. In practice Sri Lanka was party to Bunkers but not to HNS, and recovery for chemical and plastic damage proceeded through Singapore and English court actions plus P&I Club voluntary settlements over several years. The case is regularly cited in IMO Legal Committee debates as the most prominent recent illustration of the HNS gap.

Relationship to OPRC-HNS Protocol 2000 (operational response)

The OPRC-HNS Protocol 2000 is a separate instrument addressing operational preparedness, response, and cooperation for pollution incidents involving hazardous and noxious substances. Adopted at IMO London on 15 March 2000 and entered into force on 14 June 2007, the OPRC-HNS Protocol obliges States Party to maintain a national HNS pollution response capability, to participate in regional cooperation arrangements (Bonn Agreement, Lisbon Agreement, Helcom, REMPEC), and to require ships to carry an HNS shipboard pollution emergency plan analogous to the SOPEP for oil.

The OPRC-HNS Protocol is not a liability or compensation regime. It does not impose financial liability on the shipowner, does not establish a fund, and does not create a recovery mechanism for coastal States. It is purely operational. Its parallel relationship with the HNS Convention is analogous to the parallel relationship between the OPRC Convention 1990 and CLC 1992: one instrument addresses prevention and response, the other addresses liability and compensation. A coastal State should ideally be Party to both instruments, but the two are not bundled and ratification proceeds independently.

Historical incidents: X-Press Pearl 2021, Cheshire 2017, Sanchi 2018

A short review of HNS-class casualties since 2017 illustrates the practical scale of the compensation gap.

The Cheshire 2017 ammonium nitrate cargo fire occurred in the Sea of Japan when the bulk carrier Cheshire experienced spontaneous decomposition of approximately 42,000 metric tons of ammonium nitrate-based fertiliser cargo loaded in Norway. The crew was evacuated and the ship eventually towed to anchorage off the Canary Islands. Salvage, cleanup, and total cargo-loss costs ran into the low hundreds of millions of US dollars, with no Convention-based recovery available because HNS was not in force. Recovery proceeded through bulk carrier P&I cover and cargo insurance.

The Sanchi 2018 Iranian condensate casualty occurred in the East China Sea on 6 January 2018 when the Iranian Suezmax tanker Sanchi collided with the bulk carrier CF Crystal. Sanchi was carrying approximately 136,000 metric tons of South Pars condensate, a non-persistent oil cargo excluded from CLC. The tanker burned for eight days and sank with total cargo loss. The Chinese coast guard mounted a major response. The casualty fell outside CLC because condensate is non-persistent and would have fallen within HNS if the Convention had been in force in either flag State (Iran) or coastal State (China).

The X-Press Pearl 2021 container ship fire and sinking off Colombo released a mixed HNS cargo plus bunker fuel as described in the Bunkers cross-link section above. Estimated coastal damage in Sri Lanka is in the billions of US dollars, with plastic pellet pollution affecting more than 1,000 km of coastline, fisheries closure, and protected coastal habitat damage. The case is the most frequently cited contemporary illustration of the HNS coverage gap in IMO Legal Committee proceedings.

A common thread across the three incidents is that all of them, had HNS been in force, would have triggered Tier 1 owner liability up to 100 million SDR plus Tier 2 Fund liability up to a 250 million SDR aggregate, providing a coastal-State recovery mechanism quantitatively comparable to what CLC plus IOPC provides for persistent oil cargo casualties.

Per-state ratification status and EU push

As of 2026, the Convention’s ratification count remains well below the 12-State threshold. The ratifying States are predominantly coastal States with low fleet ownership and modest HNS imports. No State satisfying the 2 million GT tonnage condition has ratified; the aggregate annual contribution receipts in the ratifying group are well below 40 million tonnes. Until all three entry-into-force conditions are met concurrently, the Convention has no operative legal effect.

The European Union has been the most consistent advocate for ratification. Council Decision (EU) 2018/313 of 6 March 2018 authorised EU Member States to ratify or accede to the 2010 Protocol in the interest of the European Union, on the basis that the Convention covers matters falling partly within Union competence (jurisdiction and recognition of judgments under Brussels I) and partly within Member State competence. Fewer than half of EU Member States had completed domestic implementing legislation as of early 2026, with progress slowed by the same administrative concerns that delayed the 1996 Convention.

The IOPC Funds HNS portal publishes a ratification tracker, and the IMO Legal Committee receives an annual progress update each spring. The current trajectory points to entry into force in a medium-term window that depends on coordinated ratification by Norway plus two or more of Canada, the UK, the Netherlands, France, or Germany, plus aligned ratification by smaller contributor States meeting the tonnage and receipts conditions.

Commercial implications: P&I extension, chemical-tanker fleet, LNG fleet contributions

Entry into force will produce a step change in compulsory insurance scope and contributor architecture for the affected sectors.

Protection and Indemnity cover under International Group P&I Club rules will need to be extended from current bunker pollution and CLC tanker pollution scope to encompass HNS pollution, casualty, and personal-injury claims arising from chemical, gas, and packaged HNS carriage. The International Group has been pre-positioning since 2018 by drafting Blue Card templates for HNS Certificate issuance and by engaging with prospective State certificate-issuing authorities. The premium impact on member tonnage is expected to be modest because most HNS-relevant exposure is already covered under P&I Pollution Risks and Cargo Liability classes; the change is procedural (certificate issuance and verification) rather than risk-transfer.

The chemical tanker fleet consists of approximately 3,500 IMO-coded ships at the IBC Code Type 1, Type 2, and Type 3 levels, ranging from small coastal parcel tankers to ocean-going stainless-steel parcel tankers and product-chemical hybrids. Every member of this fleet will require an HNS Certificate, will face port State control HNS verification on entry into Party-State waters, and will see the per-voyage compulsory-insurance premium component flow through to charterer freight under standard time charter party clauses such as INTERTANKCO 5.

The LNG carrier fleet consists of approximately 600 ships as of late 2025 after the QFlex/QMax orderbook deliveries from the 2022-2025 boom, plus a further orderbook of approximately 350 ships scheduled for delivery 2026-2030. Receivers in States Party will face new annual contribution obligations to the LNG account once the Convention enters into force. The contribution rate is not yet determined but is expected to be modest at steady state and material in any year with an active LNG-class incident. The fund-flow analysis interacts with LNG well-to-wake emissions accounting and with ammonia carriage well-to-wake for prospective ammonia bunker and ammonia cargo trades after 2027.

The LPG carrier fleet of approximately 1,800 ships, the VLEC ethane fleet of approximately 35 ships, and the future liquid hydrogen carrier fleet beginning with the 1,250 m3 demonstration vessel Suiso Frontier and scaling toward 160,000 m3 commercial designs in the 2030s all fall within the LPG and General accounts. The architecture is forward-compatible with hydrogen carrier expansion because liquid hydrogen is captured by the IGC Code product list and therefore captured by the HNS scope cross-reference.

Comparison with US OPA 90 / FWPCA / CERCLA

The United States is not a party to CLC, IOPC, or HNS. The US domestic regime for marine pollution liability is a combination of the Oil Pollution Act 1990 (OPA 90), the Federal Water Pollution Control Act (FWPCA, commonly the Clean Water Act, CWA), the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), and the Resource Conservation and Recovery Act (RCRA). The framework is more fragmented than the IMO HNS architecture.

OPA 90 covers oil pollution from any vessel in US navigable waters, EEZ, or shoreline. It applies strict liability to the responsible party with a tonnage-based cap that is generally higher than CLC, with unlimited liability where gross negligence, wilful misconduct, or violation of an applicable federal regulation is shown. The Oil Spill Liability Trust Fund administered by the National Pollution Funds Center provides supplementary coverage up to USD 1 billion per incident. OPA 90 is oil-only: chemicals, gases, and packaged HNS are not within its scope.

The FWPCA / Clean Water Act Section 311 covers discharges of oil and hazardous substances into US navigable waters and EEZ. The hazardous substances list under CWA Section 311 is set by EPA regulation and broadly aligns with the IMO IBC and IMDG harmful substances lists. CWA imposes strict liability and an enforcement framework but does not provide for compulsory insurance, supplementary compensation fund coverage, or international jurisdictional reach. CERCLA covers hazardous substance releases on land or water with retroactive joint and several liability and a Superfund financing mechanism that draws from a tax on petroleum and chemical feedstocks. RCRA governs hazardous waste handling and disposal and intersects marine carriage where waste cargoes are involved.

The US framework is functionally equivalent to HNS for many incident classes, but the architecture is regulatorily heterogeneous: a single chemical tanker casualty in US waters can simultaneously trigger CWA Section 311 liability, CERCLA cost recovery, RCRA waste handling obligations, and state-law tort actions, with overlapping and sometimes inconsistent statutes of limitation, defences, and damages heads. The IMO HNS framework is structurally more coherent: a single Convention with a single liability principle, a single compulsory insurance certificate, a single forum, and a single Fund.

US accession to HNS is not anticipated. The US position since OPA 90 has been to maintain domestic legislative supremacy on marine pollution liability rather than to subordinate domestic remedies to a flag-State-driven IMO architecture. The HNS architecture is therefore likely to remain a non-US instrument with US chemical and gas trade flowing through the domestic statutory regime indefinitely.

Class society pre-positioning: DNV, LR, ABS, BV, NK

The five major class societies have all published HNS Convention guidance assuming entry into force in a medium-term window.

DNV published a guidance document covering chemical tanker, LNG carrier, and LPG carrier readiness, with technical notes on Blue Card application processes, port State control inspection scope, and shipowner data flow obligations. DNV’s view is that the practical impact on classed vessels is modest because the Convention does not impose new construction or equipment requirements, only documentation and certification.

Lloyd’s Register focuses on the OPRC-HNS interaction and on the practical interplay between the HNS Certificate and the SOPEP / SMPEP shipboard plans under MARPOL Annex I and Annex II. ABS has prepared a US-focused note acknowledging that the United States is unlikely to accede but that US-flag ships trading to Party States will require HNS Certificates from the flag State. Bureau Veritas has issued guidance for French and Mediterranean trade aligned with the Council Decision 2018/313 timeline. ClassNK has prepared guidance for the Japanese fleet, focused on LNG carrier owner readiness and the interaction between the LNG account contribution and the Japanese gas-import customs reporting framework. Japan is a critical prospective contributor State because its annual LNG receipts are among the highest in the world.

The collective class society position is that technical readiness exists, Blue Card templates are drafted, and the gating constraint is purely diplomatic. Once the 12-State and 4-large-tonnage condition is met, the Convention can be operational within the standard 18-month window. The convention does not require any new physical survey, survey code amendment, or structural construction standard; the compliance burden on entry into force is exclusively administrative.

The 250 million SDR aggregate cap: context and calibration

The 250 million SDR per-incident aggregate ceiling in the HNS Convention was set by political consensus at the 2010 diplomatic conference. The figure represents approximately one-third of the corresponding CLC plus IOPC Fund plus Supplementary Fund stack, which as of 2026 caps persistent oil pollution at 750 million SDR per incident.

The comparison is deliberate. IMO Legal Committee actuarial analysis presented at the 2010 conference estimated that the aggregate exposure from a plausible worst-case HNS incident, including a major chemical tanker casualty in a densely populated coastal zone, was lower than the worst-case persistent oil tanker casualty, because HNS chemical and gas casualties involve faster dispersion and shorter persistence in the marine environment. The 250 million SDR ceiling was calibrated against documented incident cost data from pre-2010 chemical and gas casualties and against the empirical claim distributions from oil fund payments.

The ceiling is not an absolute financial guarantee. Article 14 of the consolidated text empowers the Fund Assembly to defer or apportion payments where available reserves fall short of aggregate claims in a given year. In a scenario where an LNG or ammonia carrier casualty produces claims approaching the full 250 million SDR within a single account year, the Assembly may call additional contributions from receivers, but payment timing is subject to account liquidity. Claimants should treat the 250 million SDR as a legal maximum per incident, not a guaranteed payment floor.

The SDR values in the Convention are subject to the same revision procedures as LLMC and CLC: a formal amendment conference or a tacit-acceptance procedure with a qualified majority. No amendment to the 250 million SDR ceiling has been proposed as of 2026.

Bulk HNS versus packaged HNS: the liability-versus-contribution distinction

The packaged HNS exclusion from contribution introduced by the 2010 Protocol creates a distinction that practitioners must keep separate. Packaged HNS (chemicals shipped in drums, intermediate bulk containers, tank containers, or as IMDG Code-listed packaged goods) remains within the liability scope of the Convention. A claimant whose property or coastline is damaged by a packaged HNS spill from a container ship can bring a claim against the shipowner under Tier 1 and against the Fund under Tier 2.

What the 2010 Protocol removed was the contribution obligation on packaged HNS receivers. Under the 1996 text, a chocolate factory receiving a drum shipment of lecithin (an IMDG-listed substance) was potentially a HNS Fund contributor. The administrative burden of identifying, tracking, and billing thousands of small commercial receivers who each received a single drum consignment per year was the specific objection that blocked UK, Canadian, and Dutch ratification. The 2010 Protocol solved that problem by treating packaged HNS as liability-scope but contribution-exempt.

The practical consequence: the HNS Fund’s financial base is drawn exclusively from bulk HNS receivers. The General, Oil, LNG, and LPG accounts cover claims arising from both bulk and packaged HNS incidents, but the funding burden falls entirely on bulk receivers. This creates a minor structural asymmetry: the Fund compensates packaged-HNS claimants using money contributed entirely by bulk receivers. The Legal Committee noted this asymmetry at the 2010 conference but accepted it as the politically necessary price of making the contributor architecture workable.

For a large container ship operator, the entry into force of HNS means compulsory insurance obligations for every voyage on which IMDG-listed substances are on the cargo manifest, without any contributor obligation flowing from the cargo receiver’s side. The operator faces Tier 1 liability up to the Article 9 scale cap; the Fund compensates above that.

Limitations

Several constraints on the effectiveness of the HNS Convention framework are inherent in its design and should be noted by maritime lawyers, underwriters, and coastal State authorities.

Entry-into-force gap. The Convention does not apply until it enters into force. Every incident that occurs before that date, including every incident between 2010 and some future entry-into-force year, leaves claimants with no Convention-based recovery. The gap has already produced substantial uncompensated losses in the Cheshire, Sanchi, and X-Press Pearl casualties.

Non-Party State exposure. The Convention covers only damage in States Party and damage caused by ships of States Party. A coastal State that has not ratified cannot compel the operation of the Fund for incidents in its waters, and a ship flagged in a non-Party State that trades to Party-State waters is outside the compulsory insurance requirement until the Party State enacts port State access conditions.

SDR currency risk. All caps and contributions are denominated in Special Drawing Rights (IMF basket currency). The SDR value in local currency fluctuates with exchange rates. A coastal State whose cleanup costs are incurred in a depreciating domestic currency benefits from SDR denomination; a State in an appreciating currency faces the reverse. The IOPC Fund and HNS Fund do not index caps to inflation; the 250 million SDR ceiling set in 2010 has the same nominal value in SDR but is worth less in real terms in 2026 than it was at the diplomatic conference.

Fund account solvency under extreme claims. As noted above, the 250 million SDR ceiling is a legal maximum, not a financial guarantee. The Fund can defer payments where account reserves are insufficient. A catastrophic LNG carrier casualty in a densely populated port could generate claims at or near the full ceiling in a year when the LNG account has limited reserves from a small ratifying group.

Packaged HNS contributor gap. The exclusion of packaged HNS from contribution, while politically necessary, means the Fund compensates packaged HNS incidents from a revenue base that does not include the commercial receivers who benefit from packaged chemical trade. The asymmetry is an accepted structural feature, not a drafting error.

Bunkers double-accounting. Where a non-tanker ship carries HNS cargo and also causes bunker oil pollution, two separate liability regimes (HNS and Bunkers Convention 2001) operate in parallel. Claimants must separate the damage heads, and insurers must respond under two separate certificates. The practical administration of concurrent claims across two conventions in a single incident remains procedurally complex.

See also

• CLC 1992: civil liability for oil pollution damage
• IOPC Fund 1992 and Supplementary Fund Protocol 2003
• Bunkers Convention 2001
• MARPOL Annex II: noxious liquid substances in bulk
• MARPOL Annex III: harmful substances in packaged form
• MARPOL Convention overview
• LLMC Convention on Limitation of Maritime Claims
• LNG well-to-wake emissions
• Ammonia well-to-wake emissions by feedstock grade
• HNS Convention liability calculator
• IMO HNS 2010 substances calculator
• Bunker Convention liability scope
• Maritime calculator suite

References

The primary legal source is the consolidated text of the HNS Convention 2010 (1996 Convention as amended by the 2010 Protocol) maintained by the IMO Secretariat, supplemented by the IOPC Funds HNS portal at hnsconvention.org, EU Council Decision 2018/313, and class society guidance from DNV and Lloyd’s Register. US domestic regime citations are from the EPA Clean Water Act summary. Full citation links appear in the frontmatter.