Finnish Oil Pollution Compensation Fund

Öljyntorjunta meripuomi
Photo: Jouko Pirttijärvi

The Finnish Oil Pollution Compensation Fund, managed by the Ministry of the Environment, is used to reimburse the costs of oil spills and oil spill response on land and at sea when the party that caused the accident is not known or the culpable party is unable to reimburse the costs.

The Finnish Oil Pollution Compensation Fund is a secondary source of compensation for oil spills and the costs of responding to them. The amounts paid as compensations from the fund are recovered from the party that caused the oil spill, or from another party with primary responsibility for it.

On a discretionary basis the Finnish Oil Pollution Compensation Fund can be used to compensate for the costs of restoring soil and groundwater contaminated with oil if the party that caused the contamination is not known, cannot be reached, or cannot pay for the costs caused by the contamination. A further condition is that it is not considered reasonable to oblige the party that owns the polluted area to clean it.

Compensations to regions, municipalities and the state from the Finnish Oil Pollution Compensation Fund

Regional rescue services are entitled to compensation from the fund for expenses due to the acquisition of oil response equipment, the maintenance of oil spill prevention response preparedness, and training. The Finnish Oil Pollution Compensation Fund usually reimburses 50 to 90 per cent of the acquisition costs of oil spill response vessels. Regional rescue services and municipalities may also be granted discretionary compensation for the acquisition costs of storage facilities for oil spill response equipment. The state may be granted discretionary compensation for the acquisition costs of equipment to respond to oil accidents caused by vessels and for the costs of maintaining response preparedness. In the case of the Åland Islands compensations may be paid for the acquisition costs of oil spill response equipment for accidents caused by vessels.

Compensation decisions by the board of the Finnish Oil Pollution Compensation Fund

The board of the Finnish Oil Pollution Compensation Fund, appointed by the Government for a three-year term, makes decisions concerning compensations paid from the fund. The board has a representative from the Ministry of the Interior, the Ministry of Finance, the Ministry of the Environment, a nature and environmental conservation organisation, the oil industry, and the Association of Finnish Local and Regional Authorities. The chair of the board is impartial and does not represent any party that has an interest in oil pollution matters.

Income and expenditure of the Finnish Oil Pollution Compensation Fund

The Finnish Oil Pollution Compensation Fund is an off-budget entity. Its operations are funded through the oil protection fees and transfers from the Budget.

The oil protection fee is collected for oil which is either imported to Finland or transported through Finland. If oil is transported by a vessel whose cargo section is not completely double-hulled, a double oil protection fee is collected.

Part of the oil waste duty may be transferred from the Budget to the Finnish Oil Pollution Compensation Fund to be used to cover the costs of clean-up operations in old oil-polluted land areas. Each year an average of EUR 2–3 million of the oil waste duties have been transferred to the fund.

Use of the Finnish Oil Pollution Compensation Fund

The compensations paid annually from the Finnish Oil Pollution Compensation Fund total about EUR 10 million. This roughly corresponds to the oil protection fees collected annually and oil waste duties transferred from the Budget. The higher oil waste duty payable in 2010-2015 increased the income of the fund and the compensations paid from it. 

International Oil Pollution Compensation Fund

Compensations for oil spills caused by oil tankers in the Finnish territorial waters are paid from the International Oil Pollution Compensation Fund (1992) and its Supplementary Fund if compensations cannot be collected from the party that caused the accident or where the damage exceeds the vessel owner’s limit of liability.al Oil Pollution Compensation Fund (1992) and its Supplementary Fund in cases where compensation cannot be recovered from the party responsible for the oil spill, or where the damage surpasses the liability limit of the vessel owner.

Inquiries

Merja Huhtala, Legal Adviser, tel. +358 295 250 088, firstname.lastname@ym.fi
Published 2014-08-06 at 10:12, updated 2017-10-13 at 12:49