Brazil moves to ratify CLC/69 Protocols, increasing liability limits for marine pollution

Brazil’s Chamber of Deputies has approved Legislative Decree Project (PDL) 167/25, ratifying key updates to the International Convention on Civil Liability for Oil Pollution Damage (CLC/69). The move aligns Brazilian legislation with the latest International Maritime Organization (IMO) protocols, significantly raising compensation limits and expanding jurisdiction for tanker-related pollution incidents.

The bill now moves to the Senate. If ratified, Brazil will move away from antiquated regulations to adopt a civil liability regime already shared by 144 countries. For industry players operating along the Brazilian coast, this shift promises greater legal predictability but also necessitates immediate adjustments to insurance policies and financial guarantees.

Expanded Jurisdiction and Impact on Insurance Costs

For shipowners, the most significant change is the geographic expansion of civil liability. The current regime, based on obsolete standards, limits jurisdiction to the territorial sea (12 nautical miles). Under the new protocol, liability will cover the entire Exclusive Economic Zone (EEZ), extending up to 200 nautical miles from the coastline.

For freight forwarders and risk managers, the critical point is the substantial increase in indemnity limits. These updates significantly raise the compensation ceiling for oil spills. In practice, this entails:

• Coverage Reviews: Shipowners must secure more robust insurance certificates or bank guarantees compatible with the new IMO-mandated limits.
• Legal Certainty: A reduction in prolonged litigation is expected, as Brazil adopts international parameters for pricing environmental and economic damages.
• Operational Rigor: Hydrocarbon transport vessels operating in Brazilian waters will face higher financial exposure.

Alignment with P&I Clubs

Updating the CLC/69 has been a long-standing demand within the logistics sector to bring Brazilian operations in line with global safety standards. By ratifying the protocol, Brazil simplifies the framework for P&I Clubs (Protection and Indemnity Associations), which already utilize these parameters to assess risk in international waters.

Bill rapporteur Alencar Santana (PT-SP) emphasized that the measure is proportional to Brazil’s maritime traffic volume and the scale of offshore oil exploration. For foreign trade stakeholders, IMO compliance signals that Brazil is closing regulatory loopholes. While this increase in operational oversight may raise costs, it consolidates the country as a more transparent and secure environment for long-term maritime logistics investment.

Source: Chamber of Deputies

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