Circular No. 4/99 - Recent California Legislation



JANUARY 29, 1999




Dear Member:


Recent Californian Legislation Regarding Dry Cargo Ships

The purpose of this Circular is to draw the attention of Members who trade in Californian waters to a new State law (California S.B. 1644) which came into force on January 1, 1999 and which, from September 1, 1999, will prohibit the operation of non-tank vessels of 300 gross tons or more in the marine waters of California unless the owner or operator has an oil spill contingency plan approved by the administrator of the California Office of Spill Prevention and Response (OSPR). For the purpose of this recent legislation, the marine waters of California are understood to be those within the three mile limit.

The new law requires relevant contingency plans to:

  • Be in writing, be reviewed for feasibility, be consistent with State and area contingency plans, and not be in conflict with the national contingency plan.
  • Identify a qualified individual (QI) located in the United States and available on a 24 hours basis, who is fluent in English and has full authority to implement the vessel operators' contingency plan.
  • Provide procedures for reporting oil spills to local, State and Federal agencies, and demonstrate shipboard training of personnel in notification procedure.
  • Establish a specific chain of command and specify the overall responsibilities of crew, supervisory, contract and volunteer personnel.
  • Identify lines of communication between the vessel, on-scene commanders, response teams and local, State and Federal response organizations.
  • Provide evidence of a contract with a spill response organization to meet in a timely and effective way the "reasonable worst case spill" (as defined by the statute).
  • Provide procedures for management of the resources to be used in response to an oil spill.
  • Provide evidence of compliance with the ISM Code as applicable.
  • Identify an agent for service of process in California who is designated to receive legal documents on behalf of the plan holder.

Plans may be prepared for vessels individually, or on a fleet basis for vessels which transit substantially the same route, or on a "State-wide" basis if such plans are prepared by a non-profit maritime association or non-profit corporation in accordance with the relevant provisions of the new statute.

It is expected that draft implementing regulations for the new statute will be published very soon. Public consultation will thereafter continue for a period before the regulations are finalized. Pending finalization, some uncertainty will exist as to the detail of what constitutes compliance and what arrangements in this respect are considered most effective.

In the context of their maintenance of regular contact with providers of contingency planning and spill management services, your Managers will continue to monitor developments and further information will be provided as soon as the effect of the implementing regulations is clear.

It should also be noted that the new statute in California requires the owner or operator of a non-tank vessel subject to the contingency planning requirement to obtain - from the administrator of the OSPR - aCertificate of Financial Responsibility for $300 million covering damages which might be caused by a pollution incident. It is not expected that this requirement will be implemented before June 1999 at the earliest - and may, indeed, come into effect even later. It is hoped that production of copies of Club Certificates of Entry will enable Members to obtain a California Certificate of Financial Responsibility from OSPR.

If any Member should require any further detail or elaboration of the contents of this Circular, the Managers will be pleased to respond.

Yours faithfully,

Joseph E.M. Hughes, Chairman & CEO
Shipowners Claims Bureau, Inc., Managers for