SHIPPING
KNOWING YOUR LIMITATIONS – HONG KONG
IMPLEMENTS 1996 PROTOCOL
With effect from 3 May 2015, the 1996 Protocol (the ‘Protocol’) Personal Injury / Loss of Life Claims
to the Convention on Limitation of Liability for Maritime Claims,
Gross Tonnage
Old Limit (SDRs)
New Limit (SDRs)
1976 (the ‘1976 LLC’) now applies in Hong Kong.
<500
333,000
2,000,000
The Merchant Shipping (Limitation of Shipowners Liability)
+500 per ton
2,000,000
500 – 2,000
(Amendment) Ordinance 2005 (the ‘Amendment Ordinance’)
2,001 – 30,000
+333 per ton
+800 per ton
contains provisions amending the Merchant Shipping
(Limitation of Shipowners Liability) Ordinance (Cap 434) (the
30,001 – 70,000
+250 per ton
+600 per ton
‘Limitation Ordinance’) so that the Protocol can apply in Hong
>70,000
+167 per ton
+400 per ton
Kong. The Amendment Ordinance specifies that these
provisions are to come into force on a day to be appointed.
The daily conversion rate for Special Drawing Rights (SDRs) is
They could not come into force immediately but only after the
available on the International Monetary Fund website here.
Central People’s Government of Mainland China (‘CPG’), as the
sovereign State, arranged to deposit the appropriate accession
How substantial are the increases?
instrument with the International Maritime Organisation
As appears, the new limits of liability are substantially higher.
(‘IMO’). The CPG has now done so; and in Law Notice L.N. 81
The table below shows the old and new limits of a shipowner’s
of 2015 issued on 22 April 2015, the Secretary for Transport
liability for property damage claims, and for loss of life and
& Housing (as successor to the Secretary for Economic
personal injury claims, using gross tonnages which are
Development & Labour following the re-organisation of the
representative of, respectively: a handy-size, panamax, and
Hong Kong Government Secretariat in 2007) appointed 3 May
cape-sized bulk carrier; a 5,000 TEU container ship; and a
2015 as the date for entry into force of these provisions.
VLCC; and using a conversion rate of US$1.4 = 1 SDR.
Accordingly, the Protocol now applies in Hong Kong having
force of law by reason of section 12 of the Limitation
Ordinance; and the new limits of liability are set out in
Schedule 2 thereof.
New Limits
As a result of these amendments to the Limitation Ordinance,
a shipowner’s limits of liability for both property damage
claims, and for personal injury or loss of life claims in Hong
Kong have been increased, and are now as follows:
Property Damage Claims
Property Damage Claims
Gross Tonnage
Old Limit (USD)
New Limit (USD)
Handy-size: 25,000
$5,961,900
$14,280,000
Panamax:
$8,880,900
$21,280,000
Cape-size: 85,000
40,000
$15,873,900
$38,080,000
5,000 TEU: 55,000
$11,505,900
$27,580,000
VLCC:
$24,588,900
$59,080,000
160,000
Personal Injury / Loss of Life Claims
Gross Tonnage
Old Limit (SDRs)
New Limit (SDRs)
Gross Tonnage
Old Limit (USD)
New Limit (USD)
<500
167,000
1,000,000
Handy-size: 25,000
$12,472,600
$28,560,000
501 – 2,000
+167 per ton
1,000,000
Panamax:
40,000
$18,303,600
$42,560,000
2,001 – 30,000
+167 per ton
+400 per ton
Cape-size: 85,000
$32,310,600
$76,160,000
30,001 – 70,000
+125 per ton
+300 per ton
5,000 TEU: 55,000
$23,553,600
$55,160,000
>70,000
+83 per ton
+200 per ton
VLCC:
$49,845,600
$118,160,000
160,000
Are there any other changes?
The limit of liability for the owner of a passenger ship for
claims for loss of life or personal injury to passengers has also
been substantially increased to 175,000 SDRs (from 46,666
SDRs) multiplied by the number of passengers which the ship
is certificated to carry; and the previous cap of 25,000,000
SDRs has been abolished. For the owner of a high-speed Hong
Kong–Macau ferry, the limit has accordingly increased from
some US$21,755,689 (old limit) to some US$81,585,000 (new
limit), assuming the ferry is certificated to carry 333
passengers, and using a conversion rate of: US$1.4 = 1 SDR.
It is to be expected therefore, that the new limits will be
further increased next month for both property damage
(‘property’) claims, and for loss of life and personal injury
(‘LOL/PI’) claims, as follows (figures are in SDRs):
Gross Tonnage
New Limits
(Property)
New Limits
(LOL/PI)
< 2,000
1,510,000
3,020,000
2,0001 – 30,000
+604 per ton
+1,028 per ton
30,001 – 70,000
+453 per ton
+906 per ton
+302 per ton
+604 per ton
The Protocol makes clear that claims for special compensation > 70,000
under Article 14 of the International Salvage Convention
1989, and claims for contributions in general average, are both Further Information
excepted from limitation.
If you require further information about these changes, or
about a shipowners right to limit liability generally in Hong
Practical Implications
Kong, then please contact any of the following:
With Hong Kong now a party to the Protocol, regional shipping
lawyers could see an increase in cases of forum shopping, and
particularly because Singapore – another popular common law
jurisdiction in Asia – is still currently a party to the 1976 LLC;
and because China, whilst not a State Party to the 1976 LLC,
applies the limitation provisions of the Chinese Maritime Code
which are modelled on the 1976 LLC.
The Protocol contains a “tacit acceptance” procedure for
updating (increasing) the limits of liability, and on 19 April
2012 the State Parties agreed to adopt higher limits with
effect from 8 June 2015. Section 28 of the Limitation
Ordinance provides that:
Harry Hirst
Regional Head of Admiralty,
Partner, Hong Kong
[email protected]
Max Cross
Partner, Hong Kong
[email protected]
Rory Macfarlane
Partner, Hong Kong
[email protected]
Su Yin Anand
Partner, Hong Kong
[email protected]
“The Chief Executive in Council may by order published in the
Gazette amend Schedule... 2 in accordance with any revision
to... the Convention on Limitation of Liability for Maritime
Claims, 1976, or to any protocol [to the Convention] which
may apply to Hong Kong.”
Ince & Co is a network of affiliated commercial law firms with offices in Beijing, Dubai, Hamburg, Hong Kong, Le Havre, London, Monaco,
Paris, Piraeus, Shanghai and Singapore.
E: [email protected]
incelaw.com
24 Hour International Emergency Response Tel: + 44 (0)20 7283 6999
LEGAL ADVICE TO BUSINESSES GLOBALLY FOR OVER 140 YEARS
The information and commentary herein do not and are not intended to amount to legal advice to any person on a specific matter. They are furnished for information purposes only and free of
charge. Every reasonable effort is made to make them accurate and up-to-date but no responsibility for their accuracy or correctness, nor for any consequences of reliance on them, is
assumed by the firm. Readers are firmly advised to obtain specific legal advice about any matter affecting them and are welcome to speak to their usual contact.
© 2015 Ince & Co International LLP, a limited liability partnership registered in England and Wales with number OC361890. Registered office and principal place of business:
International House, 1 St Katharine’s Way, London, E1W 1AY.