Our mandate

For 30 years, the Fund has been mandated to compensate victims of oil pollution damage (including costs incurred for preventive measures) caused by ships and then take action to recover the costs from the polluters or other responsible parties.

  • Simply put, we receive and assess claims for any type of damage caused by any type of oil spilled by any class of ship or boat in Canadian waters.

Summary of 30 years of compensating victims of oil pollution from ships

Impacts of the 2018 modifications to the Marine Liability Act on the Fund

Legislative amendments to the Marine Liability Act (MLA) to modernize the Fund came into force in December 2018. They:

  • Removed the Fund’s per-incident liability cap, meaning compensation for claimants is now unlimited;
    • If the Fund is ever emptied, the Consolidated Revenue Fund may provide temporary replenishment;
  • Added a new simplified and fast-tracked process for most claims up to $35,000;
  • Made available emergency funding up to $10 million to Fisheries and Oceans Canada in the event of a major oil spill;
    • If the initial funds are exhausted, additional funding can be provided up to $50 million;
  • Clarified that certain forms of economic loss (including loss of revenue) are compensable;
  • Expanded the Fund’s liability when Fisheries and Oceans Canada takes preventive measures before a “grave and imminent threat” of oil pollution damage arises.
  • Modernized the levy (fee per tonne, inactive since 1976) that can be charged to oil importers and exporters;
    • Administrative monetary penalties have been created for contraventions of these provisions.

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The Canadian Compensation Regime

Canada flag and the IOPC Funds logo

The Canadian Compensation Regime for ship-source oil pollution damage is based on the polluter-pays principle as well as on many international conventions. It covers damage caused by oil pollution (or anticipated pollution) in Canadian waters (including the exclusive economic zone), as long as the pollution emanates from an identified or unidentified ship or vessel.

Role of the Fund

The Fund may be used as a fund of last resort or of first resort; the choice is that of the claimant.

Fund of Last Resort. The claimant may file a claim against the owner of the ship responsible for oil pollution damage (up to the owner’s limit of liability) and can then submit to the Fund a claim for compensation for damages or for a portion of damages that haven’t been reimbursed to him (this could be due to the fact that the limit exceeded the owner’s liability limit, or because the owner was not financially solvent to compensate the claimant).

Fund of First Resort. The claimant may submit his claim directly to the Fund. The Administrator has the obligation of investigating and assessing the claim. If the claim is established, the Administrator will offer a settlement to the claimant, who will then have 60 days to accept the offer.

2018-2019 File Portfolio (Incidents & Claims)

A record year in the number of assessments performed and in the amounts granted.

During the 2018-2019 fiscal year, the Fund managed a portfolio of 89 files, 72 claim files (25 new claims and 47 carried over from 2017-2018), and 17 incident files (3 new incidents and 14 carried over from 2017-2018).

Contributors to the regime

The contributors to the regime are the oil shippers and receivers in Canada. Contributors have not paid contributions since 1976 as the Fund is fully capitalized.

Contributors who are oil receivers must however file an information return no later than February 28 if the volume of contributing cargo for the preceding calendar year exceeded

  • 150,000 metric tonnes of persistent oil, or
  • 17,000 metric tonnes of non-persistent oil

(refer to Marine Liability and Information Return Regulations: http://laws-lois.justice.gc.ca/eng/regulations/SOR-2016-307/index.html)

This information return allows to determine Canada’s annual contribution to the International Fund and Supplementary Fund (this contribution is then paid directly by the Fund’s Administrator). It also allows Canada to collect the data needed in order to ratify the Convention on Hazardous and Noxious Substances.

Information returns should be filed via the portal https://stats.tc.gc.ca/HNS/Login.aspx, which is managed by Transport Canada.

Before filing their return, contributors must request the creation of an account by contacting the following address: TC.HNS-SNPD.TC@tc.gc.ca.

How to File a Claim

Our Claims Manual is currently being revised.