France teeters on salvage threshold

ON January 30, 2001, the French parliament authorised the government to adhere to the International Convention on Salvage adopted in London on April 28, 1989, under the auspices of the International Maritime Organisation (IMO). But this does not mean it is immediately enforceable. The French government has yet to deposit the instrument of accession with the secretary-general of IMO and thereafter to have it published in the Official Gazette - an essential prerequisite before treaties and laws can enter into force in France.

Surprisingly, nothing has been done to date. It would be natural to ponder over the reasons behind the procrastination of the French authorities in acceding to this convention, which has been in force since July 14, 1996, especially as the diplomatic conferences that gave birth to the convention were initiated by the French government in the aftermath of the 1978 Amoco Cadiz casualty. The French reluctance to ratify the convention can be traced to its wish to incorporate therein the concept of "imposed salvage", whereby the authorities of the coastal state could compel salvors to intervene whenever a casualty was deemed to threaten the environment.

France can no longer afford to lag behind the big shipping nations in issues as delicate as salvage and pollution.

But things have evolved since then, and France can no longer afford to lag behind the big shipping nations in issues as delicate as salvage and pollution. The inertia on the part of the French authorities is indeed having severe consequences on the safety of French waters by deterring salvors from intervening to fight against the spread of pollution or to prevent polluting vessels from becoming dangerous wrecks. More particularly, French salvors are finding themselves deprived of the 'enhanced award' that would otherwise reward salvors' efforts to prevent or minimise damage to the environment, whenever the distressed vessel flies a French flag and the salvage is performed in French waters.

At the moment, under French law, salvage is still governed by the 1910 Brussels Convention (France did not ratify the 1967 modifying protocol) and the domestic law of July 7, 1967 and its 1968 decree of application, which in fact has very close affinities to the 1910 convention. The implementation of the 1989 convention into French law should therefore not drastically disrupt the state of things, although there will surely be material innovations, some of them critical.

The 1989 convention will first trigger an enlargement of the scope of salvage. The principle of salvage under French domestic law - and to a narrower extent the 1910 convention - has been traditionally confined to any assistance rendered by one vessel to another, the latter including inland navigation boats as well as buoys, drilling units and other floating structures. The 1989 convention takes one big leap further as its definition of a salvage operation encompasses any act undertaken to assist any property in danger in any waters whatsoever, so long as the property is not permanently and intentionally attached to the shoreline.

This extension is rather inopportune as it wipes out any distinction between vessels, or floating structures, and wrecks. Therefore, when acceding to the London Convention, France will surely be forced to revise its specific domestic regime governing the removal of wrecks (in particular Statute Nos 61-1262 of November 24, 1961 and 85-662 of July 3, 1985, and their respective amendments). It is also dangerous as it purports to apply an international convention to the salvage of any object in danger within French inland waters. Therefore, it is to be hoped that, when ratifying the 1989 convention, France will formulate an appropriate reservation.

On the other hand, surprisingly - and unlike the 1967 law - the 1989 convention excludes fixed or floating platforms or mobile offshore drilling units when they are engaged in the exploration, exploitation or production of seabed mineral resources, as well as warships or state-owned vessels. In the latter respect, however, an option is available to decide otherwise by notifying the terms of such inclusion to the secretary-general.

On another scale, the 1989 convention's application is left to the goodwill of the plaintiff, insofar as it is held to be applicable whenever judicial or arbitral proceedings relating to matters dealt with in the convention are brought in a state which is party to the convention. The 1910 convention is only applicable whenever either the salving or the distressed vessel flies the flag of a state which is party to it.

The 1989 convention also establishes, in the much-discussed Article 14, the widespread exception to the principle of 'no cure, no pay', the cornerstone of the salvage concept. This exception, which was first suggested in the 1980 Lloyd's Form (LOF) following the severe casualties of the 1970s, is stretched even further to cover many more situations than mere oil pollution or laden tankers. Henceforth, the 'safety net' indemnity will be granted to those salvors whose efforts are aimed at minimising 'damage to the environment' - as widely defined by the same article.

It is of paramount importance to note, however, that this article could find a much wider construction in France than that given in the 1997 Nagasaki Spirit case where, after a long-running legal battle, the House of Lords finally confirmed the view that the "fair rate" referred to in Article 14 did not include a profit element but was strictly based on the expenses incurred by the salvors in fighting pollution. A reading of the French version of this same article of the convention would indeed lead to the understanding that the compensation to be paid to the salvor could embrace remuneration for the salvor's services.

This wide interpretation, which is already backed by eminent authors of the French doctrine, could also be justified by the declared purpose of this convention as well as its spirit, which is obviously to entice salvors to intervene for the protection of the environment. Following implementation of the 1989 convention, French judges should also start taking into account salvors' success in preventing or mitigating pollution damage as a single factor that would enhance any ultimate award. Until now, and despite their authority to grant an "equitable" reward, French judges in the wake of the 1997 Tereva case are still refusing to consider this criterion on the ground that it is not expressly mentioned by the 1910 convention or the 1967 law, and that in maritime salvage it is not possible to refer to the concept of the agency of necessity established under the French civil code.

Last, but not least, Article 6 of the 1989 convention allows parties to contract out of the convention. It is true that this contractual freedom is limited and that it cannot alter the basic principle that remuneration should always be equitable as well as the freshly provided duty to preserve or minimise damage to the environment. However, Article 6 can still void the convention of its entire spirit, if not its raison d'être. It paves the way to the profusion of a jungle of heterogeneous agreements and regimes and could eventually be a spur to forum shopping, at the expense of the environment.

It has been suggested that France, when ratifying the 1989 convention, should not denunciate the 1910 convention, which should then be applicable whenever the 1989 convention is waived by the parties. This, however, may add even more confusion and inconsistency. Fortunately enough, and thanks to the efforts of the International Salvage Union (ISU), the most commonly used salvage agreements, particularly the Lloyd's forms and even their French counterparts ('Contrats Villeneau') expressly incorporate the provisions of the 1989 convention as is. The ISU took this a step further by devising, together with P&I clubs and hull underwriters, an alternative remuneration system to Article 14, the SCOPIC Clause.

Unfortunately, here as well, France remained on the fringe of major developments. In particular, the 'Villeneau' standard forms, unlike the Lloyd's forms, have not been updated sufficiently and have accordingly been deemed inadequate to meet environmental concerns. It is time for urgent action, for the sake of French salvors' interests and, more importantly, for the safety of the French coast and waters.