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Strict/Absolute liability in redressing the issues of compensation post- Chernobyl Period: Role of Conventions in effective compensation

25 years after the Chernobyl accident, the international community has had time to reflect and prepare, more effectively the ways in which it responds to nuclear accidents. Moreover, at the centre of this reflection is the idea of protecting its victims and making the process of claiming compensation easier through various regimes and international liability.

The most important of these regimes are the Vienna Convention, the Paris Convention and the Convention on Supplementary Compensation. While these conventions aimed to provide some sort of relief to victims of nuclear accidents, they received major criticisms from the international community. The effectiveness of these conventions was truly tested by the Fukushima Daiichi Nuclear Accident in 2011, that took place in Japan, a country that was not a party to any of these.

The aim of this paper is to analyze and answer the question of the effectiveness of compensation and liability through Conventions and their subsequent amendments both, before and after Chernobyl.

Increasing Use of Commercial Nuclear Power:

The increasing use of commercial nuclear power post the Second World War created a vacuum in international law. Countries recognized the need for a harmonized liability system for governance. This lead to international agreements such as the Vienna and Paris Conventions that set out rules for cross-border legal actions for easy compensation claims against a nuclear operator in another state.

The conventions covered myriad issues such as jurisdiction, which laws would be applicable to the victims. The underlying idea of such regimes was to contribute to legal certainty with respect to liability. The Paris Convention on Third Party Nuclear Liability (1960) came into existence under Organization for European Economic Co- operation (now OECD).

The Vienna Convention on Civil Liability for Nuclear Damage came into force in 1963 with similar principles as the Paris Convention but a wider geographic scope.

The most important features under these conventions are the imposition of strict and exclusive liability for damage arising out of nuclear accidents. One of the major drawbacks of both conventions is the cap they put on liability claims. It is also important to note that these conventions did not apply to nuclear incidents occurring in the territory of non-contracting states, one of them being the former USSR. This fact would have major repercussions.

The Chernobyl Disaster

One of the worst nuclear accidents the world has ever seen, the Chernobyl disaster resulted in damage worth hundreds of millions of dollars. Thousands of square feet of agricultural land was irradiated, nearby towns had to be evacuated and the only reason that more people did not lose their lives is that the factory was in an isolated area. The economic damage was unprecedented.

The effects of radiation were felt across Europe and even reached USA and Japan.

Along with this, the realisation of the costs of damage, loss of life, personal injury and illness etc., were for the first time, brought into the harsh light. Extensive coverage has been laid in the damage caused by the accident, however; very little attention has been on the actual victims of Chernobyl and their fight to claim compensations wherever they may be situated. The magnitude of the accident and the consequences arising out of it were beyond the financial imagination or capability of any or state or international legal entity to be held accountable for the damages caused.

The lack of special legislation in the former USSR as well as the fact that it was not a part of the Vienna Convention and Paris Convention meant that the people affected by the disaster were completely at the mercy of their government 6.

However, it is interesting to note that had the former USSR been a part of either the Vienna or the Paris Conventions that would have allowed the people affected to claim compensation, the compensation received would have been extremely limited. Inevitably, one of the biggest questions raised in the aftermath of the Chernobyl disaster that was whether the current international nuclear liability regimes were enough to handle the trans- boundary nature of major disasters like Chernobyl itself.

One of the major fallouts of the Chernobyl Disaster was that it exposed the major gaps in the Vienna Convention and Paris Convention. The lack of special legislation within the USSR and the lack of its adherence to international compensation regimes meant that the most severely affected victims were left to the mercy of their governments, domestically and internationally.

Neighbouring countries were unable to hold the former Soviet Union liable for the damage caused. Another drawback of the conventions that would later become evident was with respect to the time period within which victims could claim damages. The period was limited to 10 years- a time span far too small to compensate victims for intergenerational injury that is a known side effect of radiation.

International Response to the Chernobyl Disaster

Post-Chernobyl, the international community rushed to amend the existing protocols.

These amendments took place in three stages:

  1. 1987, 1997 and 2004 Amendments to the Vienna and Paris Conventions: The hasty effort of bridging the gap between the Vienna Convention and the Paris Convention led to the establishment of the Joint Protocol that came into effect in 1992. The benefit of this stretched to the application of either of the conventions a state may be a party to, provided that they ratify the Protocol. However, the international community recognized soon enough that this was not enough to redress the issues of liability and compensation that were brought to light through the Chernobyl accident. The reform of the Protocol had to be far more reaching for it to be as effective as it initially aimed to be.

    In this regard, much greater compensation should be available to the victims of nuclear accidents. Therefore, a lacuna was identified in the implementation of the Joint Protocol in terms of compensation where it could only do so to the degree to which Paris and Vienna Conventions states were prepared to adhere to.

    In 1997, the Vienna Convention was amended further. It allowed countries that were not signatories to the convention to claim compensation under it. Furthermore, it increased the minimum liability that could be claimed to 300 million SDRs (Special Drawing Rights) that was roughly equivalent to 400 million USD. The period of limitations to bring in claims for increased to 30 years. Russia and Ukraine also became a signatory of the Vienna Convention in 1996.

    In 2004, the Paris Convention was also amended in a similar fashion to the Vienna amendments which detailed the definition of damage. The amendment also imposed a minimum liability of 700 million Euros which could be claimed.

  2. The Convention on Supplementary Compensation was adopted in 1997 by the IAEA. The Convention was supposed to be a tool that all countries could adhere to regardless of whether or not they were part of any other nuclear conventions or had nuclear reactors. The CSC was supposed to increase the amount of compensatory damages that were available to victims of a nuclear accident.

Major Criticisms:

While each of these conventions and their subsequent amendments were done in order to increase amount of compensation available to the victims, increases the liability of the operator, and broaden the definition of damages, the implementation of these was far from satisfying.
  1. Though the time span within which victims could claim damages under the Vienna Convention was extended, Russia and Ukraine, two countries that were most affected by the Chernobyl disaster still have not ratified the convention.
     
  2. High legal costs, security for costs, liability for costs, make it very difficult for the victims to actually claim damages.
     
  3. Despite being adopted in 1997, the CSC still had not come into force by 2011, the year the Fukushima Disaster took place. This is because the minimum number of countries (5) that need to ratify it for it to come into force still haven’t done so.
     
  4. Multiple studies estimate the costs of an average nuclear accident to be much higher than the limited amount of liability prescribed in the conventions. Moreover, there are serious differences between the national legislation implementing the conventions that can lower the liability amounts. However, even in cases where the amounts have been increased, they will never be sufficient to cover the average costs of a nuclear accident.
     
  5. The Vienna Convention also provides exceptions to damages that have resulted from armed conflicts, hostilities or civil war. The 1997 convention also included an exception to grave natural disasters that was later removed.
     
  6. The CSC has also been subjected to multiple criticisms. One major criticism is that compensation can only be claimed within 10 years of the nuclear accident.
     
  7. Limitations placed on liability in terms of the amount of compensation that can be claimed as well as statutory limitations on bringing claims, give favour to the nuclear operators rather than providing protection to the victims.

The Fukushima Disaster:

In 2011, a major earthquake triggered a massive tsunami in Japan. This tsunami caused widespread damage and led to the meltdown of 3 nuclear reactors at the Fukushima Daiichi Nuclear Power Plant. As a direct result of this meltdown, over 160,000 people had to be evacuated from their homes.

The presence of the Japanese “Act on Compensation for Nuclear Damage, 1963” that holds the nuclear operator solely liable for nuclear damage. However, the Japanese Government was also held liable for the damage resulting from the meltdown due the element of foreseeability thanks to a 2002 report that included a possibility of a major natural disaster in the next 20 years.

The damages caused by the disaster are estimated to be more than $100 billion in value. While the Japanese governments is making huge payouts as compensation to the victims, the underlying costs are mainly being paid by Japanese taxpayers in the form of taxes and electricity bills.
Post-Fukushima, the Japanese Government ended up ratifying the CSC post the Fukushima Disaster in order to encourage experienced US companies help clean up the radiation from the disaster.

Initially, when the CSC was proposed in 1997, Japan refrained from being a part of it as Japan’s internal laws governing nuclear activity and its liability provided superior protection to its victims.

Also, the Japanese government did not anticipate that Japan could be involved in a nuclear accident with trans-boundary effects, especially when none of its neighbouring countries were party to either of the Conventions. Japan’s interest in CSC re-emerged post the 2011 Fukushima incident. It prompted Japan’s ratification of CSC in 2015 that collectively possessed over 400,000 MW of installed nuclear capacity. A report produced by the House of Councillors, this change in position was mainly due to various re-evaluations post-Fukushima in terms of risks associated with the use of nuclear power and renewed interest in providing legal predictability for the nuclear industry.

Another emphasis of this report was on the fact that sanctioning the CSC would make it easier for the United States to aid in the process of clean up at Fukushima reactor by appeasing the concerns of U.S firms regarding liability. It further highlighted the effect of ratifying CSC by Japan which would help in promoting the adoption of CSC in the throughout Asia and in the countries that were aspiring to become nuclear powers.

Current Stance of Japan on Liability:

Currently in Japan, there are no limitations on liability. However, with the ratification of the CSC, this is expected to change. This is due to industry groups that are in favour of imposing limited liability. They are also in favour of sharing payouts with the general population. This stance is receiving support from the Japanese Government.

Conclusion:
To conclude, the existing treaties work in a way to protect the nuclear industry from liability over providing adequate compensation to its victims. The path of constant innovation has almost always been followed by accidents and there can be very little doubt that there will be more in the future.

As examined in this paper, the current regimes provides evolved principles of protection following the worst nuclear disaster at Chernobyl however, limitation on damages, short statutory limitations and poor membership of countries in various treaty systems is still scarce. The basic motive of the Joint Protocol has not been fully achieved as a number of States that have nuclear power programs continue to adhere only to either of the Conventions.

Therefore, membership remains fragmented with some nuclear powers not a part of any of the international nuclear regimes and only be governed by their national laws. Despite Chernobyl and Fukushima, none of the conventions follow absolute liability even though nuclear disasters are the worst form of ultra-hazardous accidents.

The exemptions allowed by the Conventions further water down their effectiveness. This ultimately begs the questions, to whom are these Conventions are actually catering to?
Ultimately, it is the test of time that shall see how the present frameworks hold up, in case of another accident with trans-boundary damages.

Bibliography
  • Currie D, The Problems And Gaps In The Nuclear Liability Conventions And An Analysis Of How An Actual Claim Would Be Brought Under The Current Existing Treaty Regime In The Event Of A Nuclear Accident (2006)
  • International Nuclear Law In The Post-Chernobyl Period (OECD 2006)
  • 'Japan Taxpayers Foot $100Bn Bill For Fukushima Disaster | Financial Times' (Ft.com, 2018)accessed 2 November 2018
  • Ram Mohan M, 'The Development Of Institutions And Liability Laws Relating To Nuclear Energy' [2015] Nuclear Energy and Liability in South Asia
  • Ram Mohan M, Nuclear Energy And Liability In South Asia (Springer India 2015) Schwartz J, International Nuclear Third Party Liability Law (OECD 2006)
  • University of Pennsylvania Asian Law Review:
  • Swartz, Nathan (2016) "The Impact of the Convention on Supplementary
  • Compensation for Nuclear Damage,"
  • Vol. 12 : Iss. 2 , Article 6.
  • Available at: https://scholarship.law.upenn.edu/alr/vol12/iss2/6

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