ACTIO Regulatory Analysis The Aftermath of The Bow Jubail: IOPC Funds Amended Guidance for Member States on the Definition of a “Ship”

 By Setyawati Fitrianggraeni, Tiyana Sigi Pertiwi, Orima Melati Davey

 

A. EXECUTIVE SUMMARY

The IOPC Funds Secretariat published revised guidance (approved by the Funds’ governing bodies in November 2025 and issued December 16, 2025) clarifying when a vessel is to be regarded as a “ship” for the purposes of the 1992 Civil Liability Convention (1992 CLC). The amendment adds a footnote (inserted into the Funds’ existing “Guidance for Member States”) that: (1) defines “residues” as remnants of a persistent oil cargo that represent a material pollution risk; and (2) establishes a practical, prima facie procedure, centered on tank-cleaning in accordance with MARPOL Annex I Chapter 4 and the Master’s countersigned Oil Record Book (ORB) entries, for showing the vessel is free of such residues. The amendment was prompted by the Bow Jubail litigation and aims to reduce divergent State practice and evidentiary uncertainty. This has immediate consequences for Member States investigating spills, for insurers and P&I clubs, and for coastal States that are not Fund Members (whose remedies and access to Fund compensation remain constrained).

B. FACTUAL BACKGROUND

Case Brief: The Bow Jubail Incident

Prior to the incident of 23 June 2018 in Rotterdam, the 23,196 GT oil/chemical product tanker Bow Jubail had completed a transatlantic voyage from Houston via Antwerp, to Rotterdam. During this voyage, the vessel transported eight different persistent oils within the meaning of the International Convention on Civil Liability for Oil Pollution Damage 1992 (“1992 CLC”), distributed across eighteen cargo tanks. Two tanks contained blended pyrolysis pitch, an asphalt-like substance believed to fall within the Convention’s definition of “oil.” In other words, the vessel had recently functioned squarely as a persistent-oil tanker under the CLC regime.

On 23 June 2018, the tanker Bow Jubail (an oil/chemical product tanker) was in ballast at a Rotterdam terminal when it collided with a jetty, rupturing the hull and releasing approximately 217 tonnes of bunker oil polluted the port area (not cargo oil). The spill contaminated the port extensively. Damages including pollution of harbour waters and shore facilities, fouling of numerous third-party vessels, loss of hire and port disruption, large-scale wildlife mortality (hundreds of protected birds, including more than 500 swans), with a total claimed damage exceeding EUR 80 million.

The tanker vessel had in fact discharged a persistent oil cargo on a prior leg and had undertaken tank cleaning, pre-washes and slop discharge before arriving in Rotterdam. In view of this fact, the legal question became as to whether the vessel can still qualified as a “ship” under the 1992 CLC for that incident (i.e., whether residues remained), so as to make the CLC/Fund regime applicable?

This is because under the 1992 CLC, a “ship” is defined as:

“… a sea-going vessel constructed or adapted for the carriage of persistent oil in bulk as cargo, including when empty, unless it is proved that it has no residues of such cargo onboard.”

Therefore, if the vessel is to be considered ceased to be a “ship” under the 1992 CLC because all persistent-oil residues had been removed, only Bunkers Convention/domestic law shall apply. However if it is still considered as a “ship” under the 1992 CLC convention despite the tank cleaning has been claimed to be completed, the 1992 CLC and the IOPC Fund regime applies.

Dutch courts ultimately rejected the shipowner’s contention that the vessel was not a “ship” for CLC purposes, finding insufficient proof it was free of residues. Consequently, the 1992 CLC (and hence Fund compensation) into play.

What is the relationship of this incident to IOPC

The International Oil Pollution Compensation Funds (IOPC Funds) is a governing body part of an international liability and compensation regime for oil spills from tankers. It is rooted in a 3-tier compensation provided by the following international treaties:

 Table 1. Illustration on the compensation regime through IOPC Funds between the 1992 CLC & IOPC Funds Conventions

Compensation Tier	Convention	Limitation of Liability
Tier-1	The 1992 CLC	Strict liability for shipowners and insurers. The limits of liability of shipowners as established in the 2000 Amendments to the CLC are, as follows: • For a ship not exceeding 5,000 GT, liability is limited to 4.51 million SDR • For a ship with 5,000 to 140,000 GT:  liability is limited to 4.51 million SDR plus 631 SDR for each additional GT over 5,000 • For a ship over 140,000 GT: liability is limited to 89.77 million SDR
Tier-2	The 1992 Fund Convention	Under the Fund Convention, the IOPC Fund’s maximum payment for incidents occurring on or after 1 November 2003 is SDR 203 million, including the amounts paid by the shipowner or insurer.
Tier-3	The Supplementary Fund	The additional compensation allowed by the Supplementary Fund Protocol is up to SDR 750 million for member States, including any amounts actually recovered from the shipowner, his insurer and the 1992 Fund.

The International Oil Pollution Compensation Fund 1992 (the 1992 Fund) was established under the 1992 Fund Convention in order to provide compensation for victims who do not obtain full compensation under the 1992 CLC. By becoming Party to the 1992 Fund Convention, a State becomes a Member of the 1992 Fund. In other words, in order to utilize the tier-2 of the compensation through the IOPC Fund, the State must become a Member of both the 1992 CLC and the 1992 Fund Convention. Further, to access the tier-3 compensation through the IOPC supplementary fund, the state must become a member of the Supplementary Fund Protocol.

In this case,  the Netherlands is a Contracting Party to the IOPC Funds, specifically the 1992 Civil Liability Convention, the 1992 Fund Convention, and the Supplementary Fund Protocol. The Bow Jubail litigation exposed inconsistent national approaches across States and courts as to (a) what counts as “residues”, and (b) what proof is necessary to show a ship is no longer a “ship” under the 1992 CLC.  The legal uncertainty faced in the Bow Jubail case prompted the IOPC Funds’ governing bodies to direct  the Secretariat to prepare guidance for Member States.

C. REGULATORY ANALYSIS

 What is changed by the Amended Guidelines/Footnote

Consequently, the governing bodies of the IOPC Funds approved the insertion of a footnote into the Funds’ “Guidance for Member States” in section 3.1(2) and 3.1(4) of the IOPC Funds’ publication ‘Guidance for Member States – Consideration of the definition of ‘ship’ under the 1992 Civil Liability Convention’ (the amended text was adopted November 2025 and published in December 2025), as follows:

“For the purposes of the 1992 CLC, ‘residues’ are the remnants of a persistent oil cargo of a quantity that represents a material pollution risk. Tank cleaning conducted in accordance with Annex I, Chapter 4 of MARPOL 73/78 will remove residues, and any corresponding material pollution risk. Where a vessel undergoes cleaning and flushing of its cargo tanks, slop tanks, residual oil tanks and all associated pumps and pipelines in accordance with Annex I, Chapter 4 of MARPOL 73/78; and any oil, tank washing and/or oily mixture have been discharged or transferred off the vessel, the completed Oil Record Book countersigned by the Master as required under MARPOL, will be prima facie evidence that the vessel is free of residues.”

Here is an analysis of the key points of the new footnote:

• Interpretation on the definition of “residues”: “Residues” in Art 1(2) of the 1992 CLC are remnants of a persistent oil cargo in a quantity that presents a material pollution risk (i.e., the relevant legal threshold is material risk of pollution, not absolute absence of hydrocarbon molecules). It does not require proof that no oil whatsoever remains in the tanks, but only that the tanks have been cleaned sufficiently so that they no longer represent a material pollution risk.
• Tank-cleaning standard: If tank cleaning and flushing have been carried out in accordance with Annex I Chapter 4 of MARPOL 73/78, including cleaning of cargo, slop and residual oil tanks and associated lines and any oil/tank washings have been discharged or transferred ashore as required, then that process removes residues such that a material pollution risk no longer exists.
• Oil Record Book (ORB) as prima facie evidence: A completed Oil Record Book, countersigned by the Master as required under MARPOL, will be accepted as prima facie evidence that the vessel is free of residues (i.e., it provides the starting evidential presumption that tanks no longer present a material pollution risk). That presumption can be rebutted by contrary evidence in a concrete case.
• No new obligation on industry: The Funds emphasize the guidance does not create obligations beyond MARPOL. Rather it clarifies how MARPOL-compliant cleaning and the ORB will be treated for the narrow question of whether a vessel remains a “ship” under the 1992 CLC.

Implications for State Members (what changes, and what doesn’t) 

(A) Change to the Evidential Regime

Member State authorities and the Funds’ Secretariat will treat a MARPOL-compliant cleaning standard and Master’s countersigned ORB as prima facie proof that the vessel no longer presents a material residue risk. This simplifies early assessment and reduces divergent outcomes when the ORB and MARPOL compliance are documented. At the same time the footnote preserves the Fund/State’s ability to rebut the presumption with countervailing evidence (e.g., laboratory sampling showing persistent oil residues, contradictory ORB entries, CCTV/port logs showing non-compliant discharges).

(B) No Change to the Legal Scope of Compensation under the 1992 regime

• No change to legal scope: The amendment does not change the statutory definitions in the 1992 CLC or the Fund Convention. The legal definition of “ship” in the Convention remains the same; the footnote provides a standard procedural/evidential approach for applying that definition. The Funds therefore preserve the Conventions’ substantive law while offering a uniform evidentiary test.
• Member-State receipts of Fund compensation remain conditional: Compensation from the 1992 Fund is available only where the pollution damage occurred in a State Party to the 1992 Fund Convention (and where claimants cannot obtain full compensation under the 1992 CLC). The amendment does not extend Fund coverage to non-Member States or change the Fund’s geographic/party limitations. States that are not party to the 1992 Fund Convention remain outside the Fund’s compensation net.

(C) Interaction with other instruments (MARPOL, Bunkers Convention)

• MARPOL: Because the guidance treats MARPOL Annex I Chapter 4-compliant cleaning as the key evidence, MARPOL compliance now has heightened practical significance in compensation determinations under the 1992 CLC. This tightens the operational link between pollution-prevention rules (MARPOL) and the liability/compensation regime.
• Bunkers Convention: Where a vessel switches between persistent oil cargo and non-persistent cargo / bunkers (or is unladen after carrying persistent oil), whether the Bunkers Convention or the 1992 CLC applies may hinge on residues. The Funds’ guidance reduces legal uncertainty by clarifying when a tanker that was formerly laden should still be treated as a “ship” for 1992 CLC purposes.

Note: What it Means for Indonesia (A non-member state of the IOPC Funds Convention)

Indonesia has ratified UNCLOS, MARPOL 73/78, the Bunkers Convention and the 1992 CLC, but not the IOPC Funds (both the 1992 Fund Convention and the Supplementary Fund Protocol). So as a non-member state, what are the immediate implications to the change of the footnote of these guidelines for Indonesia, if any?

Limited Access Remain to IOPC Funds

Since Indonesia has not yet acceded to the 1992 Fund Convention/IOPC Funds, the 1992 IOPC Fund will not pay compensation for pollution damage occurring in Indonesian territory, notwithstanding the amendment to the guidelines and as to whether there has been a broadening definition on what is considered as a “ship” falling under the CLC or not. Further, the amendment does not change this membership rule. It only guides Member States how to treat residues when assessing Fund involvement. This of course may not apply to non-member states of the IOPC Funds.

If Indonesia wants access to the IOPC Fund, accession to the 1992 Fund and/or the Supplementary Fund is still required. Victims can only rely on remedies under the 1992 CLC (direct claims against the shipowner and its insurer) and on Indonesian domestic law only. They cannot claim for the second and third tiered compensations under the IOPC Fund.

However, as to the question on whether a “ship” should be considered as falling under the 1992 CLC or not, this amendment to the IOPC Funds member guidance may be helpful and referred to by judges in domestic litigations, with the effect that MARPOL-compliant tank cleaning standards and ORB are to be treated as prima facie evidence in domestic litigations.

Conclusion

The IOPC Funds’ amendment of guidance for member states is an evidentiary refinement driven by the uncertainty in the Bow Jubail litigation. It does not rewrite the existing Conventions nor does it add a more stringent obligation from MARPOL. However,  it provides Member States of the IOPC Funds with a usable standard for national interpretation in domestic courts for oil spillage. In this regard, it clarifies that  MARPOL-compliant tank cleaning and the Master’s countersigned ORB, are prima facie proof that tanks are free of residues causing material pollution risk. On the question of whether a vessel remains a “ship” under the 1992 CLC, this should be treated narrowly.

 

Bibliography

International Conventions

International Convention on Civil Liability for Oil Pollution Damage (adopted 27 November 1992, entered into force 30 May 1996) (1992 CLC).

International Convention on the Establishment of an International Fund for Compensation for Oil Pollution Damage (adopted 27 November 1992, entered into force 30 May 1996) (1992 Fund Convention).

International Convention for the Prevention of Pollution from Ships (adopted 2 November 1973, as modified by the 1978 Protocol, entered into force 2 October 1983) (MARPOL 73/78), Annex I, ch 4.

United Nations Convention on the Law of the Sea (adopted 10 December 1982, entered into force 16 November 1994) (UNCLOS).

International Convention on Civil Liability for Bunker Oil Pollution Damage (adopted 23 March 2001, entered into force 21 November 2008) (Bunkers Convention).

Official Guidelines by IOPC Funds

International Oil Pollution Compensation Funds, ‘IOPC Funds publishes revised guidance for Member States on the definition of “ship”’ (Press Release, 16 December 2025) <https://iopcfunds.org/news/iopc-funds-publishes-revised-guidance-for-member-states-on-the-definition-of-ship/#>

International Oil Pollution Compensation Funds, Guidance for Member States: Consideration of the Definition of “Ship” under the 1992 CLC (IOPC Funds, 2025) <https://iopcfunds.org/wp-content/uploads/2025/12/Guidance-for-Member-States%E2%80%94Definition-of-ship_e.pdf>

International Oil Pollution Compensation Funds, Bow Jubail – Incident Summary and Case Study (IOPC Funds archive case study, 2020 update)

Other Secondary Sources

Skuld, ‘IOPC Funds Amended Guidance for Member States on the definition of ‘ship’ under the 1992 Civil Liability Convention’ (2026) <https://www.skuld.com/topics/environment/oil-pollution/marpol-annex-i/iopc-funds-amended-guidance-for-member-states-on-the-definition-of-ship-under-the-1992-civil-liability-convention/>

Swedish Club, ‘Circulars – P&I– No: 2740/2025: IOPC Funds Amended Guidance for Member States on the definition of ‘ship’’ (2025), < https://www.swedishclub.com/news/circulars/iopc-funds-amended-guidance-for-member-states-on-the-definition-of-ship/>

West of England P&I Club, ‘Notice to Members No.14 2025/26 – Amended guidance on definition of ‘ship’ under 1992 CLC’ (2025), < https://www.westpandi.com/News-and-Resources/Notice-To-Members/2025-2026/no-14-2025-26-amended-guidance-on-definition-of/ >