India recently ratified the Convention on Supplementary Compensation (CSC) which it has signed in 2015.
What is CSC
Compensation in case of any nuclear accident is governed by three international conventions Vienna Convention, Paris Convention and CSC.
Vienna and Paris Convention puts the liability for damage completely on operator. Along with this liability is limited in time and amount and the host country's courts are given complete jurisdiction. But these do not cover liability in case of damage to third country. Therefore the need for CSC was felt whose main principles are:
1. Liability is channeled exclusively to the operator of the nuclear installation.
2. Only courts of the state in which the nuclear accident occurs would have jurisdiction (exclusive jurisdiction);
3. Limitation of the amount of liability and the time frame for claiming damages (limited liability).
4. The operator is required to have adequate insurance or financial guarantees to the extent of its liability amount (liability must be financially secured).
Other important provisions of CSC are:
• The international convention provides for compensation in case of trans-national implications of a nuclear accident and has been signed by 14 countries, including India.
• The CSC provides for establishment of an international fund to increase the amount available to compensate victims and allows for compensating civil damage occurring within a State's exclusive economic zone, including loss of tourism or fisheries related income.
• It also sets parameters on a nuclear operator's financial liability, time limits governing possible legal action, requires that nuclear operators maintain insurance or other financial security measures and provides for a single competent court to hear claims.
• Another special feature of the CSC is that 50% of the international funds are to be used to compensate damage suffered both inside and outside the installation state, while the remaining 50% is to be used exclusively to compensate transboundary damage.
CSC and India's Civil Nuclear Liability Law:
Many foreign countries and their nuclear suppliers have raised concerns over the Indian Civil Nuclear Liability and said that it is not in conformity with CSC. Some of the concerns raised are:
• Section 17(b) provides Right of Recourse (RoR) to Operator. Under this operator can sue supplier for damage in case of latent or patent defects in supplied equipments.
• Sec 46 provides RoR to victims also by saying that this law is in addition to other domestic laws in force thus allowing criminal liability and other tort claims
Indian government establishments have constantly said that Indian law is in conformity with CSC. Any issue of RoR of the operator has to be inbuilt into the contract signed by the two and will not be automatic. This provision is in confirmation with art 9 of the CSC.
How the ratification will impact ?
The ratification of the CSC is going to give assurance to the nuclear commercial establishments of different countries that India's nuclear liability regime is in conformity with the international laws.
This will start the flow of the investment in Indian Nuclear Energy field.