CYIL Vol. 5, 2014

JAKUB HANDRLICA CYIL 5 ȍ2014Ȏ limitation of operator liability. Pursuant to Article III (1), “the liability of the operator as regards one nuclear ship shall be limited to 1,500 million francs in respect of any one nuclear incident notwithstanding that the nuclear incident may have resulted from any fault or privity of that operator; such limit shall include neither any interest nor costs awarded by a court in actions for compensation under this Convention.” 34 Concerning laying down liability limitations, it should be pointed out that even this principle was not un-controversial during negotiations within the Convention. Several countries defended the opinion that nuclear liability concerning the operation of nuclear-powered military vessels should be unlimited. However, in the end it was agreed to extend the benefit of limiting liability to military vessels as well. 35 A further controversy was linked to the setting of actual liability limits. Basically, two trends were represented at the Conference, the difference comprised mainly in the relation between liability limits and the possibilities within insurance markets. One group of delegations taking part at the Conference, represented basically by the United States, supported establishing a high limit of liability regardless of the possibilities of the insurance market. The opposite view was represented mainly by the Scandinavian states, the Soviet Union and Liberia, which favored setting the limit of liability with regard to the capacities of the international insurance market and without involving financial guarantees from the licensing state. 36 Subsequently, the Convention placed the liability limit much higher than the Paris Convention and the later Vienna Convention, to 1,500 million (Poincaré) francs (approximately $ 100 million). At the time of the Convention’s adoption and even for a decade after it 37 the limit was considered in excess of total coverage available in the existing insurance markets. Regarding the congruence between operator liability and his obligation to maintain insurance or other financial security, NS Convention, Article III (2) provides, that “the operator shall be required to maintain insurance, or other financial security covering his liability for nuclear damage, in such amount, of such type and in such terms as the licensing State shall specify. The licensing State shall ensure the payment of claims for compensation for nuclear damage established against the operator by providing the necessary funds up to the limit laid down in paragraph 1 of this Article to the extent that the yield of the insurance or the financial security is inadequate to satisfy such claims.” This provision means the Convention left both the amount and the quality of coverage to International Convention Relating to the Limitation of the Liability of Owners of Sea-Going Vessels, of 10 October 1957. 34 Concerning the currency used in the Convention, Article III (4) provided, that “the franc mentioned in paragraph 1 of this Article is a unit of account constituted by sixty-five and one half milligrams of gold of millesimal fineness nine hundred. The amount awarded may be converted into each national currency in round figures. Conversion into national currencies other than gold shall be effected on the basis of their gold value at the date of payment.” 35 Op. cit. sub note 11, at p. 102. 36 Op. cit. sub note 11, at p. 103, and special in notes 15, 17 and 18. 37 Op. cit. sub note 4, at p. 556.

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