Liability for Nuclear Damage

In one line

Nuclear liability follows the oil pollution design of strict, channelled, capped and insured liability, and India departed from it in one respect that has kept foreign suppliers out of its market.

In exam wording: the international nuclear liability regime rests on the Vienna Convention on Civil Liability for Nuclear Damage 1963 as amended by its Protocol of 1997, the Paris Convention on Third Party Liability in the Field of Nuclear Energy 1960 with its Brussels Supplementary Convention, the Joint Protocol of 1988 linking the two, and the Convention on Supplementary Compensation for Nuclear Damage 1997; its four common features are strict liability without proof of fault, legal channelling of all liability to the operator of the nuclear installation, limitation of the amount and of the time within which claims may be brought, and compulsory financial security.

The four features, and why each exists

One: strict liability. The victim of a release cannot prove how a reactor failed, and requiring proof of negligence would make the remedy illusory.

Two: legal channelling to the operator. All liability is placed on the operator of the installation, and no other person is liable. The supplier of a component, the designer, the constructor, the carrier and the parent company are all immune. Two reasons are given: the victim knows immediately whom to sue, and the risk can be insured once rather than by every participant in a long supply chain.

Three: limitation of amount and of time. Liability is capped so that it can be insured, and claims must be brought within a period that reflects the long latency of radiation injury, which the 1997 Protocol extended to thirty years for loss of life and personal injury.

Four: compulsory financial security. The operator must maintain insurance or other security in the amount of its liability, and the installation State guarantees the difference if the security is insufficient.

The four are interlocking, exactly as in the oil pollution regime. Strict and unlimited liability would be uninsurable; a cap without insurance would be worthless; and channelling is what allows one policy to cover the whole risk.

What the 1997 Protocol changed

It raised the minimum liability amount substantially, expressed in Special Drawing Rights; it widened the definition of nuclear damage to include, beyond death, personal injury and property damage, the costs of measures of reinstatement of impaired environment, loss of income deriving from an economic interest in any use or enjoyment of the environment, the costs of preventive measures, and other economic loss, to the extent determined by the law of the competent court; it extended the geographical scope to damage suffered in the territory, maritime zones and exclusive economic zone of a Party and, in some circumstances, of a non-Party; and it extended the prescription period for death and personal injury to thirty years.