IMO Hazardous Cargo Compensation Treaty to Enter Into Force in 2027, Strengthening Global Maritime Liability Framework
The International Maritime Organization (IMO) has confirmed that the International Convention on Liability and Compensation for Damage in Connection with the Carriage of Hazardous and Noxious Substances by Sea (2010 HNS Convention) will enter into force on 29 November 2027, establishing a comprehensive global compensation regime for accidents involving hazardous cargo transported by sea.
The treaty marks a significant advancement in international maritime law, addressing long-standing gaps in the shipping industry’s liability and compensation framework as global seaborne trade in chemicals, liquefied natural gas (LNG), liquefied petroleum gas (LPG), and alternative marine fuels continues to expand.
Entry Into Force Conditions Officially Achieved
The requirements for the Convention’s implementation were fulfilled on 29 May 2026, triggering the 18-month countdown to its formal entry into force. The 2010 HNS Convention consists of the original 1996 Convention as amended by the 2010 Protocol.
According to Article 21(1) of the Protocol, the Convention becomes effective 18 months after at least 12 States formally agree to be bound by the treaty, including four States each possessing no less than two million units of gross tonnage. Additionally, contracting States must collectively report at least 40 million tonnes of contributing cargo during the preceding calendar year.
The conditions were met following ratifications by Belgium, Germany, the Kingdom of the Netherlands, and Sweden in April 2026. Currently, 12 States are contracting parties to the Protocol, with nine of them exceeding the required two million gross tonnage threshold.
Cargo reports submitted to the IMO also confirmed that more than 40 million tonnes of contributing cargo were recorded during the 2025 reporting year, satisfying the final requirement for the treaty’s activation.
IMO Welcomes Long-Awaited Milestone
IMO Secretary-General Arsenio Dominguez described the achievement as a major step forward for global shipping regulation.
“The fulfilment of the conditions for the entry into force of the HNS Protocol is a long-awaited milestone that closes an important gap in the international liability and compensation regime for shipping,” he said.
He added that the treaty will provide fair and timely compensation to those affected by hazardous cargo incidents involving ships while offering greater legal certainty for governments and the maritime industry.
Expanding Protection Beyond Oil Pollution
The 2010 HNS Convention complements existing IMO liability regimes covering oil pollution and hazardous shipwrecks by extending protection to incidents involving more than 2,000 hazardous and noxious substances carried by sea.
The Convention covers a wide range of damages, including:
- Loss of life
- Personal injury
- Property damage
- Economic losses
- Environmental damage
- Pollution response and clean-up costs
The substances covered include chemicals, oils, acids, fertilizers, alcohols, LNG, LPG, and numerous other hazardous cargoes regularly transported through international shipping routes.
Shipowners Required to Maintain Financial Security
Under the Convention, shipowners will be subject to strict liability for damages arising from HNS incidents. They must maintain State-certified insurance or other approved financial security mechanisms to ensure compensation is available following an accident.
Industry estimates suggest that approximately 65,000 ships worldwide will be required to obtain HNS certificates of insurance or equivalent financial security once the Convention enters into force.
HNS Fund to Provide Additional Compensation
A key feature of the Convention is the establishment of the HNS Fund, designed to provide compensation when claims exceed the shipowner’s liability limits.
The Fund operates under the internationally recognized “polluter pays” principle, ensuring that both the shipping sector and industries handling hazardous cargo contribute to compensation for affected parties.
Funding for the HNS Fund will come from post-incident contributions paid by receivers of hazardous and noxious cargo in contracting States.
Total compensation under the Convention is capped at 250 million Special Drawing Rights (SDR) per incident, equivalent to approximately USD 360 million at current exchange rates.
The HNS Fund will be administered by participating States, with contributions calculated according to actual compensation requirements arising from incidents.
Current Contracting States
As of 29 May 2026, the 12 contracting States to the HNS Convention are:
Belgium, Canada, Denmark, Estonia, France, Germany, the Kingdom of the Netherlands, Norway, Slovakia, South Africa, Sweden, and Türkiye.
The Convention’s entry into force in 2027 is expected to strengthen maritime risk management, hazardous cargo liability coverage, environmental protection, and financial security across the global shipping industry, particularly as maritime transport of chemicals and alternative fuels continues to grow.
Read More:Trinidad and Tobago Strengthens Marine Spill Response for Hazardous and Noxious Substances
