Opinion Liability truths
Post-Bhopal concerns about the N-liability bill arent justified....
The judgment on the Bhopal disaster has incited the Bharatiya Janata Party and the Left parties to renew their attacks on the Civil Liability for Nuclear Damage Bill,2010,which is pending before the Parliamentary Standing Committee on Science and Technology.
Several misconceptions are prevailing about the bill: that the compensation limit of Rs 500 crore is too low in the light of Bhopal; that the bill permits foreign suppliers of defective equipment to get away scot free; and so on. But in fact,the bill will bring speedy compensation to the victims of a nuclear accident,unlike Bhopal where the victims had to wait long years. Indeed,the present bill adheres to international best practices and is far better than the national laws of countries such as Canada.
First,it is a no-fault bill,and relieves the victims of the burden of proving negligence (that is,it is a strict liability bill). The plant operator is compelled to pay compensation irrespective of the cause of the accident (that is it is also an absolute liability bill). Second,unlike the victims of Bhopal who had to wait for years to receive compensation,Clause 16 of the bill provides that the claims commissioner shall make his award within three months of the incident occurring,and ensure that payment reaches the victims within a further 15 days.
Third,even though it is not mentioned in the bill,under the common law of torts,the victims retain their rights to file claims for damages over and above the operators no-fault liability limit. Fourth,the state continues to retain its right to file criminal charges of culpable homicide or causing death due to negligence.
At present there is no law in India which compels either the government,or the operator of a nuclear plant,or an equipment or material supplier to pay compensation until negligence is proved in a court of law. The Public Liability Insurance Act of 1991 specifically excludes nuclear and radiological accidents. Moreover,the Indian Atomic Energy Act of 1962 makes no mention at all of liability or compensation in the event of a nuclear accident. Most life and health insurance policies also specifically exclude death or damage due to nuclear accidents or radiation.
Indeed,India is the only major country already operating as many as 18 nuclear power plants which is not a member of either the 1963 Vienna Convention on Civil Liability for Nuclear Damage of the IAEA,or the 1960 Paris Convention on Third Party Liability in the Field of Nuclear Energy of the OECD.
In addition to wanting vendors of equipment,components,and raw materials to be directly liable,the opposition criticises the Rs 500 crore limit on operator liability as far too low,and the supplementary liability of the government,as passing on the burden to the Indian taxpayer. They also say the 10-year limit for claiming damages is too short.
But all these objections are contrary to both the Vienna and Paris conventions,signed by over 80 countries. Both share the following main principles. First,liability is channelled exclusively to the operators of the nuclear installations; second,liability of the operator is absolute,that is,the operator is held liable irrespective of fault; third,liability is limited in amount; fourth,liability is limited in time. Compensation rights are extinguished if an action is not brought within ten years from the date of the nuclear incident.
Indeed,the cap of liability of an Indian operator at Rs 500 crore per incident is well above those of several other countries. China has a liability cap of Rs 205 crore,Canada of Rs 335 crore,and France is about the same at Rs 575 crore. Moreover,this limit of Rs 500 crore can be easily raised,as clause 6(2) of the bill permits the Central government to do so by issuing a notification.
A controversial issue is the liability of the suppliers of faulty equipment. Clause 17 as tabled in Parliament stated that the operator of a nuclear installation shall have a right of recourse where: (a) Such right is expressly provided for in a contract in writing; (b) The nuclear incident has resulted from the willful act or gross negligence on the part of the supplier of the material,equipment,or services,or of his employee; (c) The nuclear incident has resulted from the act of commission or omission of a person done with the intent to cause nuclear damage. This is stricter than IAEAs model law which contains only 17(a) and 17(c) and not 17(b). There are reports that the government plans to drop Clause 17(b). That would be fatal; they should stand firm in retaining it,so that suppliers are not negligent and exercise due diligence in design and manufacturing.
With a bit of tweaking,especially on the clauses relating to faulty equipment and enhancement of the liability cap,the bill would exceed international norms.
The writer heads a telecom consulting firm in Delhi
express@expressindia.com
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