Report of the 10th Meeting of the Ad Hoc Working Group of Legal and Technical Experts to Consider and Develop a Draft Protocol on Liability and Compensation for Damage Resulting from Transboundary Movements of Hazardous Wastes and Their Disposal

by Basel Action Network 

30 August - 3 September 1999

What was expected to be the final negotiating session to develop a protocol on Liability and Compensation for the Transboundary Movement and Disposal of Hazardous Wastes broke down with a major North/South impasse over two key provisions. The North/South split, reminiscent of the Basel Ban negotiations before 1996, occurred on the second day of the meeting when it was revealed that most of the vocal OECD countries present never intended to abide by the protocol. Rather they intended to make use of a massive loophole which they insisted remain within the text. This loophole would allow countries that entered intobilateral, multilateral and regional agreements (e.g. OECD Council Decision on Waste Shipments for Recycling, EU Waste Shipment Regulation etc.) to opt out, "provided their exists a liability and compensation regime ...that meets the aims of the protocol." This weak language about "meeting the aims" and the intention by OECD countries to utilize this loophole was decried by developing countries as creating a double standard with non-OECD countries expected to adhere to the protocol while OECD countries would not.

While OECD countries argued strenuously for the opt-out provision, they were also insisting that they would not commit to a compensation and preparedness fund sought primarily by developing countries. It was this one-two punch by OECD countries that so angered developing countries to the point where they balked on any further compromise unless OECD countries demonstrated a commitment to the protocol. A ten person contact group was formed to try and resolve these two issues.

The two issues were seen as being strongly linked due to the fact that non-OECD countries believed that if OECD countries never intended to utilize the protocol, it would be unlikely that they would ever ratify and thus without the OECD contributions, the fund would be an empty one.

Meanwhile the Basel Action Network (BAN) and BAN member organization West Coast Environmental Law Association (WCELA), of Canada, denounced the entire draft as having been successively, meeting after meeting, reduced to a largely meaningless and redundant document, made only more impotent by the massive exclusion and lack of a fund.

The environmental NGOs noted that the protocol's failure to hold the generators liable simply allowed hazardous waste producers to avoid liability by utilizing waste brokers -- "mailbox companies," a practice already all too common. They also decried the draft for its failure to extend liability to a time frame longer than the point of deposit, combustion, or processing of the hazardous waste. They likewise called for a deletion of the entire exemption mentioned above that allowed for countries entering bilateral, multilateral, or regional agreements as well as deletion of a paragraph which called for stronger national liability laws to be rendered inoperative (see Article 23). Finally the NGOs also called for commitment to the so-called "emergency fund." (For more information on the BAN position see "Saving the Liability Protocol", "Position Paper on Article 23" and "Position Paper on Bilateral, Multilateral Liability Protocol Opt-Out" on BAN website http:www.ban.org, under Subsidiary Bodies Section).

The meeting ended without agreement on the two primary issues of the opt-out and the fund. The developing countries clearly stated their preference for moving the negotiations to COP5 in hopes that Ministerial level representatives may be able to resolve the dispute in a manner favorable to a stronger rather than a weaker protocol.

It is our view however that unless the draft protocol is substantially revised to:

• Require that Generators are Liable;
• Extend the Time-Frame of applicability to "after-care" of disposal operations;
• Eliminate the Article 11, protocol opt-out;
• Allow national laws to be stronger;
• Commit to establishment of an Emergency Fund;

then it is not worth saving as it will largely be redundant (IMO's Hazardous and Noxious Substances (HNS) Convention will have already covered almost the entire scope of the new protocol); will actually have counterproductive impacts particularly in those countries where national liability laws are already stronger; and moreover will set a very dangerous precedent for liability regimes to come. As much as we would like to see a strong international liability protocol for hazardous waste trade and disposal, it is unlikely that the above flaws can be corrected at COP5.

In our view the failure of the Liability Protocol has been due to bad faith negotiations of many of the OECD countries and in particular Germany, Austria, Japan, USA, Canada, South Korea, Australia and New Zealand. These countries have since the beginning of the negotiations have sought to weaken the scope and protections available to victims in the protocol to the point of narrow impotence. Then after they succeeded in reducing the protocol to the barest minimums they announced that they had no intention of ever abiding by it. It has become very clear that despite indicating good faith by signing the Basel Convention and thus its Article 12 calling for the Liability Protocol negotiations, these countries never wanted the protocol in the first place. Instead of removing themselves from the negotiations they have sought to undermine them.

BAN was represented at the meeting by BAN Secretariat coordinator Jim Puckett, BAN Secretariat Legal Advisor Roger Kluck, and BAN member organization representative Waldemar Braul of the West Coast Environmental Law Association (WCELA).

Below we will review the steps taken for each of the remaining contentious articles. Articles that had already been agreed by the Ninth Session are entitled: Objective; Definition; Fault-Based Liability; Preventive Measures; Combined Cause of the Damage; Right of Recourse; Contributory Fault; Implementation; Time Limit of Liability; State Responsibility; Competent Courts; Related Actions; Applicable Law; Mutual Recognition and Enforcement of Judgements; Relationship of this Protocol with the Basel Convention; Signature; Ratification, Acceptance, Formal Confirmation or Approval; Accession; Entry into Force; Reservations and Declarations; Withdrawal; Depository; Authentic Texts. The text of these articles can be found on the Basel Convention Secretariat Website at http://www.unep.ch/basel/.

The following articles, then, were the subject of the meeting. At the outset, the concept for negotiation was that of a "package" deal, wherein countries agreed that they would compromise on their national preferences in the event that a "package" could be achieved with provisions that most countries "could live with." However, inexplicably, on the last day of the meeting, the chair of the plenary, allowed the package concept to fall away and a landslide of reservations on various articles were noted. This was a destructive development for those wishing to conclude a deal at COP5 or soon thereafter.

The meeting itself was organized into an Open-Ended Group (Articles 3,4,16,23) and a Financial Group (Articles 12,13,15). These two groups often met simultaneously, severely disadvantaging countries with only one person on their delegations. Fortunately BAN Secretariat and BAN affiliate West Coast Environmental Law Association (WECLA) provided ample cover to all but the closed contact groups. During the course of the meeting their were various meetings (closed to observers) of the Group of Latin American and Caribbean (GRULAC), Asian Group, EU, Western Europe and Others Group, and JUSCANZ (Japan, United States, Canada, South Korea, Australia, New Zealand). Later a legal drafting group was formed to clean up the text that had been decided, and a contact group was formed to try to resolve the impasse described above. Mrs. Flor de Maria Perla de Alfaro (El Salvador) chaired the meeting. Ms. Katherine Kummer (Switzerland) chaired the Open-Ended subgroup and Mr. Henrik Kjellin (Sweden) was chair of the Financial group.

Note: the quotations below were taken from notes and may not be the precise verbatim quotation. They are meant to be accurate reflections of the meaning of interventions made during the meeting in order to give a picture of the sentiments expressed.

Article 3 -- Scope of Application

BAN entered the record of the meeting noting that we could not agree with the draft scope of application as it failed to apply to the vast majority of expected harmful incidents arising from the transboundary movement and disposal of hazardous wastes -- the time frame following the deposit, combustion or processing of the hazardous wastes. Unfortunately the Parties attending the meeting did not wish to discuss this critical flaw of the protocol, refusing to even discuss the sub-category of disposal of residues from recycling operations.

Rather, the biggest battle within this Article, and one of those which caused the breakdown in the negotiations had to do with a proposed massive loophole or exclusion from the Protocol whereby any countries entering a bilateral, multilateral, or regional agreement in accordance with Article 11 of the Basel Convention can opt-out as long as they have a liability regime which "meets the aims of the protocol." This very weak language would allow any hazardous waste transaction in the world to be exempt from the protocol as long as the countries involved claimed that they had a liability regime in place "meeting the aims" of the protocol. This weak exemption language was the strongest language deemed acceptable by some of the Parties involved in the Ninth session.

However this gaping exemption carried over from the last meeting, did not receive its due condemnation until delegations from countries like Germany and Austria stated openly on the floor that their countries did not need the protocol and would not use it but rather make use of OECD or EU agreements under this exclusion. They claimed that unless such an exemption existed they would never ratify. This bit of news was shocking to developing countries, which began to convene jointly to protest this development. On the suggestion of the delegate from Pakistan, the Asian group joined the "African and Arab Group," the "Group of Latin American and Caribbean" (GRULAC), into one group reminiscent of the old G-77. Instead they called themselves the "Like-Minded Group".

First, the "Like-Minded Group" were angered that at the last hours, the OECD would suddenly surprise the meeting with the notion that they were somehow "too good" for the protocol -- creating a double standard. Austria, Sweden, Germany and others claimed in their defense that they already had their own liability regimes which they claimed were stronger in many respects than the Protocol. BAN however pointed out the hypocrisy of these countries because on the one hand they claimed that they wanted to opt-out of the protocol in order to maintain higher standards, while on the other hand these were the same countries that argued against maintaining stronger national standards within the protocol in Article 23. BAN released a floor document and made an intervention calling for a deletion of the entire exclusion and the reinstatement of stronger national standards in Article 23. (See "Position Paper on Bilateral, Multilateral Liability Protocol Opt-Out").

The other serious concern of the "Like-minded Group" was the fact that OECD countries would have no incentive to ever ratify the Protocol if they were thinking of never applying it in any event. All the OECD would be likely "achieve" by ratifying would be to enter into obligations such as the obligation to contribute to a fund. While Austria and Germany stated that they would only ratify the Protocol if they could opt-out, it was quickly realized that they would in fact have little reason to do so. A fund without the OECD would be an empty fund and the fund was one of the most important provisions to the "Like-Minded Group." As the Egyptian delegate described it, "My country derives 60% of its income from the Suez Canal when all the related tourism and commerce is counted. If there were to be an accident in the Canal that could not be cleaned up, what would that mean to our country? You can see how important this fund is to us."

The French delegate made one of the more interesting defenses of the opt-out when she stated that France wants to be able to opt out not so much because we have stronger laws, indeed she stated that their laws were often not very good at all, but we have different laws. Nobody was bold enough to note at that point that all countries have different laws, but the purpose of an international treaty is to establish a global level of protection (a floor) which could then be built upon on a national or regional basis. In any international accord, it was incumbent on all countries to modify their national laws to accommodate the global norms.

The delegate from Colombia, serving as spokesperson for the "Like-Minded Group" made several eloquent interventions. She noted that 70% of current waste trade was among OECD countries alone. That meant that more than 70% of waste trade would not be covered by the protocol. "We wish to know whether you are proposing a double standard," she said. She went on to ask for a deletion of the entire exemption calling strongly for "a consensus on the same set of rules," finally noting that "the article 16 fund is useless until we have a clear understanding that all will abide by the protocol."

A contact group was formed in the last three days of the meeting to try and make progress on the fund/opt-out impasse. However a real breakthrough was not reached as OECD countries were not willing to concede anything to the "Like-Minded Group" and likewise the "Like-Minded Group" was unwilling to allow the OECD the massive exclusion and non-commitment to the protocol and the fund. "We want to see some political will and commitment to the protocol," said the delegate from Colombia. By the end of the meeting new, bracketed (undecided) text was inserted by Colombia on behalf of the like-minded group which served to shore-up the language of "meets the aims of." Instead using the words "and which provides victim compensation rights and remedies which meet or exceed those of the Protocol in..." and then the text lists all of the key articles of the protocol.

In addition to the above stumbling block, there was also a great deal of discussion during the course of the week regarding the complex Article 3 issue of when and where the protocol will apply when not all of the states concerned (importing, exporting and transit) are Contracting Parties to the protocol, or in the case of re-import. These sections were discussed at length and elaborated. It was mostly decided that transit states that are not parties can still find rights of recourse in the Protocol provided that such states are listed in a special annex which at the outset is only supposed to include the small island developing states (A.O.S.I.S.) which are also subject to a Basel Article 11 agreement which is in force. This latter provision was a concession made by Australia on behalf of Waigani Convention countries (in the South Pacific). However this listing ignores other high risk areas of the world such as shipping canal states and other coastal states and also ignores regional agreements such as the Bamako Convention, Izmir Protocol and Central American Agreement. Despite the protests and reservations of such excluded developing countries the annex as confined, remained in the text.

Finally, there was considerable debate about the applicability of hazardous wastes defined under Article 1 (1) (b) of the Convention -- nationally defined hazardous wastes. Despite opposition from some quarters (e.g. India, Turkey, Denmark), the surviving language, albeit with much in brackets (undecided), will disallow application of Article 1 (1) (b) wastes unless the wastes in question have been shipped illegally. However at the last minute, Australia insisted that they had asked for brackets to go around the qualification language in its entirety which if removed would leave all Article 1 (1) (b) waste exempt from the protocol. In BAN's view there is no worthy reason to exclude this entire sector of Basel defined hazardous waste from the protections meant to be afforded victims by the protocol.

Article 4 -- Strict Liability

BAN duly noted for the record that it was a very serious mistake for the Parties to exclude generators from the net of strict liability. The exclusion was contrary to all notions of the Polluter Pays Principle and the clear need for incentives to promote the minimization of hazardous waste generation and its transboundary movement. The exclusion in fact has the perverse effects of providing strong incentives for generators to both pass wastes to brokers and to ensure that these brokers then engage in transboundary movements of hazardous wastes.

BAN and Greenpeace have argued strenuously from the beginning of Basel liability discussions that continuous unbroken generator liability is the only way to assure that generators pick capable and responsible transporters and disposal/recycling facilities and verify their continued proper management. Absent such continuing liability, generators will seek only the lowest cost services without regard to environmental or human health protection. This will inevitably lead to dire results. (More on the need for generator liability can be found in BAN paper "Saving the Liability Protocol").

However, having abandoned earlier notions that the waste generator should remain strictly liable for his wastes, the Ninth session and forwarded two alternatives for paragraph 1 of Article 4 on Strict liability:

• Alternative 1 - holding the notifier liable until the disposer takes possession (Note that the notifier will not necessarily be either the generator or exporter, but can be a broker);
  
• Alternative 2 - holding liable the person in operational control of the wastes at the time of the incident.

Despite reservations by Australia, Germany, Japan, Austria, Korea and New Zealand, who opted for alternative 2, alternative 1 prevailed as the working option.

Two new paragraphs were added to Article 4 providing for liability for re-importation scenarios where wastes were rejected or refused. These provisions tie liability again to the notifier and to the exporter. While these provisions provide some certainty in re-importation/ re-export scenarios, and as such are necessary given the choice made above, continued generator liability would resolve this issue more simply, clearly and fairly.

Article 12 -- Conflicts with other Liability and Compensation Agreements

As reported from the Ninth Session the first paragraph of Article 12 was meant to assure that the Basel Convention and the protocol would not conflict with the Hazardous and Noxious Substances (HNS) Convention, specifically, and other such transportation treaties more generally. Parties wished to make sure that the presence of different limits on strict liability insurance requirements, etc. did not lead Parties to forego signing a former Convention in favor of a latter one in an effort to choose the most favorable regime for their own circumstance. This purpose was retained and with minor wording changes the first paragraph was approved by the Plenary.

However the second paragraph of Article 12, proved to be more contentious. This provision under went a radical last minute substitution, in the financial working group (under the leadership of the UK) -- a meeting whose attendance at that juncture was dominated almost exclusively by OECD countries (The GRULAC and other developing nations were largely absent due to their assignment to concurrent drafting groups and the key contact group on the fund/opt-out).

In that meeting, the bracketed provision from the Ninth Session, which would have recognized only subsequent agreements providing for greater rights of compensation, was replaced with a provision for a prohibition from entering "bilateral" agreements "incompatible with the protocol." BAN and other delegates quickly pointed out that this provision did not preventmultilateral or regional agreements from being incompatible, and in fact implied that such agreements to evade the protocol were permissible. The UK chair, however, quickly called the meeting to a close and the provision was reported to the plenary as having been resolved with only one reservation.

In the open-ended group and plenary session the same issues were raised again. The evasive "justifications" for not expanding the provision to include multilateral or regional agreements in conjunction with the insistence on the above mentioned exclusion found in Article 3 led many to a conclusion that OECD countries were not bargaining in good faith and in fact wanted to utilize multilateral liability regimes in conjunction with the exclusions that were in fact incompatible with the objectives of the protocol.

Article 13 -- Financial Limits

As reported from the Ninth Session this article was intended to provide a cap to the strict liability of Article 4. Fault based liability would remain unlimited according to Article 5.

Paragraph 1 delivered from the Ninth session in brackets sought to establish a variable strict liability limit based on per tonne basis with a maximum cap. Some argued against the use of the arbitrary per tonne measure noting many extremely hazardous compounds could do extensive damage in quantities of less than one tonne. These parties stressed a desire of one simple number as a cap on strict liability. The German proposal was put forward as providing a cap of 50 million SDR (Special Drawing Rights -- monetary standard established by International Monetary Fund (IMF) based on a combination of hard currencies). Others urged consistency with the HNS Convention limit of 100 million SDR.

Several parties, most notably the United States, Australia, and Canada, quickly sought to move away from a simple maximum limit for strict liability. These same parties argued that because Article 15 requires that the full potential liability under Article 4 be insured, the limit of liability should be on a sliding risk-based scale to allow for insurability at cheaper rates. Discussions quickly grew more complicated as delegates argued for different rates for transporters, recyclers and disposers.

Some Parties. Especially the United States, urged to defer the complex nature of this discussion by creating an Annex in which all these issues would be resolved and then deferring discussion of the Annex until the end of the negotiation on the Article. Some saw this as an effort to create a series of complexities incapable of resolution within the 10th session designed to keep the protocol from being resolved at the meeting. The US delegate kept repeating "We're going to need some time." While there were many objections, the chair of the financial working group opted for this annex and defer approach.

With the deferral of these issues to an eventual annex, the financial working group quickly decided that the paragraph 2 alternatives, which denied the limited liability cap to those acting either intentionally or recklessly were unnecessary as these scenarios were captured under the unlimited liability of Article 5. Japan argued repeatedly for extending the strict liability cap (limited) to negligent actions, but could find no other support in the group for this position.

The bracketed language of paragraph 3 from the Ninth session, providing that there is no limit to fault liability under Article 5, was quickly re-adopted.

Paragraph 4 from the Ninth session requiring a regular review of the liability cap was moved somewhat illogically into the new Annex.

The heart of the Annex itself proved, as many feared, far too difficult to resolve once the decision was made to move away from a single cap figure. Subsequent discussions merely added more and more layers of complexity. Limits were even proposed as low as 1 million SDR per tonne with a cap as low as 5 million SDR. Some Parties indicated that absent solid numbers from the insurance industry these figures could not be reasonably assessed. A few persuasive parties argued that there was no need to make the difficult formulations of risk. They argued that these would be done by the insurance industry and reflected in the cost of the premiums. The United States, Canada and Australia however, argued vehemently that insured should not have to pay the extra premiums for low risk wastes.

BAN believes that reducing the strict liability limit to accommodate insurance premiums reflects a fundamental mistake. This notion robs victims of the certainty and prompt payment possible under strict liability, to allow for smaller premiums for insures. It would be far better to do away with the requirement that the full amount of strict liability be insured (Article 15 para 1) than to limit victims' rights and chances of recovery. Mandatory insurance coverage could then be more flexible while preserving victims compensation rights.

In the end all strict liability limit numbers were removed and the annex was forwarded with brackets around empty figures.

Article 15 -- Insurance and Other Financial Guarantees

Paragraph one as reported from the Ninth Session, established a principle that the full amount of strict liability of Article 4 (the amount of which was left to be determined in the Annex to Article 13) should be fully insured or otherwise available under bonds or other financial guarantees. Again, BAN believes that this idea was perversely used to seek to lower the strict liability limits available to victims for recovery to make insurance more "affordable". The principle was quickly adopted in the earliest sessions of the financial group and the first paragraph underwent only minor editorial changes. The bracketed language reported from the Ninth session concerning states acting as exporter, importer, generator, or disposer was deleted as superfluous.

The United States argued persistently throughout financial group meetings, and open-ended group and plenary sessions that parties other than states should be allowed to self-insure under this provision. Their position saw little or no support, however from others. Belgium and BAN repeatedly pointed out that unlike states, self-insured companies or individuals could easily be found insolvent or unavailable at the time of incident or court decision. The incident itself could so hurt the stock value of a company as to make the financial guarantee unavailable or encourage other creditors to insist on expedited payments, etc. There were also questions raised as to which national regime would be relied upon for the certificate of self-insurance, and other scenarios of subsequent bankruptcy, insolvency or flight of liable parties.

While some asked if the general expression "other financial guarantees" in Paragraph 1 allowed for self-insurance, the general consensus was that the very existence of the self-insurance exception for states, following as it does directly after this language created a presumption against self-insurance for potentially liable parties that were not states.

Paragraph 3, as reported from the Ninth session required that proof of insurance accompany notifications under Article 6(1) of the Convention. Canada objected to having the proof of insurance for the disposer sent to the exporting country and insisted this was unnecessary paper work. While BAN objected that this burden was extremely minimal and that having the proof of insurance recorded in the notification of the exporting nation gave additional opportunities for State or public access to this information to ensure compliance, the paragraph was eventually changed so that disposers needed only to deliver proof of insurance to their home country, the state of import.

Paragraphs 4 and 5 as reported from the Ninth Session, were deleted due to the creation of the Annex to accommodate lower cost insurance premiums in Article 13, negating the need for these paragraphs. Yet again BAN would point out that this resolution results in limiting victim rights through strict liability to attain lower insurance costs, an illogical solution to a largely overstated problem.

Paragraph 6 reported from the Ninth session became paragraph 4 of the new report, after the deletion of the two paragraphs above. This section originally provided that victims could proceed directly against the insurance company in cases where the insured was bankrupt, had wound up their business, or was insolvent. Several countries quickly expressed that limiting direct action to this narrow range of situations was unnecessary and a consensus was quickly reached to delete the limiting language and make direct action available to all victims.

The United States (still not a Party to the Convention) objected strenuously and repeatedly to any direct action against insurers. They stated this was not customarily done under US law and might create difficulties in obtaining insurance. The IMO and others pointed out there are several other treaties for transport and maritime accidents that provide for such direct action. BAN noted also that US law could readily and easily accommodate such a cause of action through implementing legislation. Belgium, the IMO and others noted also that the insurance companies would adjust to insure in the face of direct action.

The United States refused to relent on this point though and returned to it at every level. The United States wished simply to have a notification as to whether direct action was available by Parties, while Belgium sought to make such countries affirmatively opt out of this provision. The United States offered long, confusing defenses in the plenary on its position that were not understood. However because of the apparent complexity, these interventions led many to consent on what seemed to them a minor point. The United States prevailed in the final report which required a notification to the Depository concerning whether signatories' laws provide for direct action.

Article 16 -- Compensation Mechanism

As in many conventions, the question of who will pay for protecting the environment loomed large in the proposed protocol. This is particularly the case in those instruments with impacts from pollution as in the protocol where the richer countries not only are responsible for most of the global problem, but moreover have the resources to do something about it.

For many developing countries the protocol fund was the most important of its aspects. A case in point regarding its utility would be last year's very costly illegal dumping of hazardous wastes in Cambodia. Action to respond to the dump in a safe and responsible manner was severely hampered by the unwillingness by entities involved to take responsibility for it, the lack of adequate emergency response, and the lack of funds to pay for the expensive appropriate response. As a result, persons were killed by an unnecessary panic and a riot stemming from a lack of accountability and action. Furthermore, the immediate environment and workers involved in the clean-up were not protected by state of the art protections. There are few developing countries that are resourced to adequately deal with this type of disaster or another involving spills or sinkings during transport. Even more important are funds for prevention and preparedness for such disasters.

The compensation fund is very much linked to another fund called for under the Convention -- the so-called emergency fund (Article 14 of the Convention) to respond to emergency situations. As the delegate of Colombia stated,"it has been 10 years since the beginning of the Convention and we still don't have an emergency fund. We were constantly told, that the deliberations on such a fund should be deferred until the outcome of a decision by the Liability drafting group as to the nature of the compensation fund. Now the issue is being further deferred."

Despite the stated needs of developing countries, the majority of OECD countries stubbornly refused to commit to such a fund. Rather they offered language that would only go so far as to commit to a study as to the possible need. The Western Europe and Others Group (WEOG) along with Korea and Japan offered one version of Article 16 that called for: "an evaluation...in order to decide on the need for a compensation mechanism and its possible nature." In response, the Asian, the African and GRULAC groups presented another proposal which started with the words: "A technical and financial mechanism that shall include a compensation fund is herewith established."

The delegate from Canada articulated the view of WEOG, stating that the appropriate way to proceed on any problem was to analyze it and then decide on a course of action. "To call for a fund ahead of that process was tantamount to signing a blank check," she argued. Malaysia backed Canada in this stand.

Pakistan on the other hand, said"This is not the first meeting, this decision comes after 10 years. I have here a document full of references to incidents of damage. We now have the information to show that the necessity of establishing the fund is beyond any doubt. Certainly the modalities can be worked out after further study but we need a commitment to do it now. We should be serious and rationale here. An accident of disastrous proportions can happen in any part of the world at any time."

These disparate positions were unable to come together, rather the two versions were melded in an uncomfortable matrimony with key words distinguishing the two versions put into brackets which both sides cling to.

Article 23 -- Relation between the Protocol and the Law of the Competent Court

The hypocrisy of OECD countries was revealed when many of these countries (e.g. Sweden, Germany, Austria) argued on the floor of the plenary that the reason they need the bilateral multilateral agreement exclusion from the protocol was because they wished to retain their own higher national standards. Yet at the same time many of these same countries insisted on an "exclusivity" clause in the second paragraph of Article 23 which states:

"No claims for compensation for damage based on the strict liability of the notifier or exporter liable under Article 4 shall be made otherwise than in accordance with this Protocol."

This wording is precisely designed to prevent countries from using their own national standards if they are acting under the protocol, even if those national standards are higher or more rigorous.

BAN and WCELA intervened during the meeting, and also issued a floor paper "Position Paper on Article 23" (found on BAN website) as well as issued a floor paper "Position Paper on Article 23" (found on website) pointing out the hypocrisy of those countries that claimed they wanted out of the protocol to retain stronger standards and at the same time arguing that the protocol itself disallow the use of stronger national standards. Our paper pointed out the regressive nature of forcing countries with sophisticated and very strong liability regimes, such as those in Canada and the USA to lower their standards -- meaning that for many the protocol would serve to provide weaker protections rather than stronger ones!

The United States delegation also made some protests in this regard but failed to rigorously defend their position to the same extent as they were prone to do with so many other issues (e.g. those that served the interests of their national industries and insurance companies). They stated that they intended to maintain high U.S. standards by using yet another exclusion found in the first paragraph of Article 3 which allows exporting states to exclude the application of the protocol if they so notify the Depository. However even if the United States makes use of their own domestic liability laws with respect to the export of wastes, this exclusion would not be of service to victims if the US were an importing or transit state.

While BAN, and WCELA strongly opposed this exclusivity provision, the meeting passed the language unbracketed, with only Japan reserving their position on it.

END