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Web Alert: OPA 90 Limits of Liability Increased by USCG

20 August 2019

On 13 August 2019, the United States Coast Guard issued a final rule in the Federal Register to provide for consumer price index adjustments of the Oil Pollution Act of 1990 (OPA 90) limits of liability. The coast guard is required by statute to adjust the limits of OPA 90 not less than every three years to account for increases in the consumer price index (CPI). The intent of the adjustments is to prevent the statutory limits of liability from depreciating due to inflation.

OPA 90 proscribes that the responsible parties or facility from which oil is discharged or which poses a substantial threat of discharge of oil, into or upon navigable waters or the adjoining shorelines are strictly liable, jointly and severally under 33 U.S.C. 2702. The coast guard is responsible for adjusting the limits of liability for ships, deepwater ports and onshore facilities. The procedure for determining the amount of adjustment is defined by the coast guard’s regulations and found at 33 CFR 138.240. The limits are drawn from a formula based on the ship’s type and size. Please see the below table that lists some of the applicable OPA 90 limits of liability for ships.

Members should note that the responsible party, as defined under OPA 90, will lose the right to limit liability if the discharge was caused by gross negligence or willful misconduct or if there was a violation of federal safety, construction, or operating regulation by the responsible party, agent employee or contractual privy. A responsible party will also lose the right to limit liability if it fails to report the incident, provide reasonable cooperation and assistance with removal of the spill as requested or comply with the authority’s orders.

OPA 90 Limits of Liability
Vessel Type
Previous limit of liability                      
Current limit of liability
Non-Tank Vessel
The greater of $1,100 per gross ton or $939,800
The greater of 1,200 per gross ton or $997,100
Tank Vessel
Single Hull*
< 3,000/GRT
The greater of $3,500 per gross ton or $7,048,800
The greater of $3,700 per gross ton or $7,478,800
>3,000/GRT
The greater of $3,500 per gross ton or $25,845,600
The greater of $3,700 per gross ton or $27,422,200
Double Hull
< 3,000/GRT
The greater of $2,200 per gross ton or $4,699,200
The greater of $2,300 per gross ton or $4,985,900
>3,000/GRT
The greater of $2,200 per gross ton or $18,796,800
The greater of $2,300 per gross ton or $19,943,400
 

*Note that tank vessels not equipped with a double hull can no longer operate on waters subject to the jurisdiction of the US, including the EEZ carrying oil in bulk as cargo or cargo residue. However, OPA 90 continues to specify limits of liability for single hull tank vessels so the USCG continues to adjust those limits of liability for inflation.