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Increased tonnage limitation figures set to be adopted in Hong Kong

News / / Hong Kong

Consistent with most maritime jurisdictions, Hong Kong allows ship-owners to limit their liability for both property damage claims and for personal injury or loss of life claims.

History

In May 2015, Hong Kong adopted the 1996 Protocol to the 1976 Convention of Liability for Maritime Claims. Shortly thereafter, on 8 June 2015, the State Parties to the Protocol agreed higher limitation figures which were to apply if adopted locally through domestic legislation. The effect, if enacted, was to increase the tonnage limits by a little over 50%.   Hong Kong did not adopt those higher limits into its local law in 2015. That is soon to change.

The Present

On 11 October 2017, the Chief Executive tabled the Merchant Shipping (Limitation of Ship-owners Liability) Ordinance (Amendment of Schedule 2) Order 2017 with the Legislative Council. The effect of this is that the higher IMO limits for maritime accidents are to be enacted into Hong Kong law.  

As at time of writing, the revised limits for maritime incidents are expected to come into effect on 4 December 2017. The previous limits will remain applicable in incidents that occurred before this date. 

As a result of these amendments, a ship-owner’s limits of liability for both property damage claims, as well as for personal injury or loss of life claims in Hong Kong, will be increased as follows:

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The daily conversion rate for Special Drawing Rights (SDRs) is available on the International Monetary Fund website.

Comment

It remains to be seen what effect this change has on casualty dispute resolution in the region. However, with some of the major maritime states in Asia now applying very different limitation regimes, we anticipate that forum shopping will become an even more critical aspect to resolve in the early stages of a casualty.

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