Section 10June 02, 2007, Sec./Art. 10

Limitation of Liability. - The Owner shall be entitled to limit his liability under this Act with respect to a particular Incident to a total amount calculated as follows:

(a) Three million (3,000,000) units of account for a Ship not exceeding five thousand (5,000) units of tonnage;

(b) For a Ship with a tonnage in excess thereof, for each unit of tonnage, four hundred twenty (420) units of account for each unit in addition to the amount mentioned in paragraph (a) : Provided, however, That this aggregate amount shall not, in any event, exceeds 59.7 million units of account:

Provided, further, That the limit of liability of the Owner as aforementioned shall be subject to adjustment according to subsequent amendments to the 1992 Civil Liability Convention.

The limited liability, under this Section may not be availed of by the Owner if it has been established that such Pollution Damage resulted from his personal act or omission, committed with intent to cause such damage, or committed recklessly and with knowledge that such damage would probably result.

The "unit of account" referred to in this Section is the Special Drawing Right (SDR) as defined by the International Monetary Fund as set forth in the 1992 Civil Liability Convention. The said amount shall be converted into national currency on the basis of the value of the currency by reference to the SDR on the date that the fund is constituted under Section 11 of this Act.

The SDR is an international reserve asset, created by the IMF in 1969 to supplement the existing official reserves of member countries. SDRs are allocated to member countries in proportion to their IMF quotas. The SDR also serves as the unit of account of the IMF and some other international organizations. Its value is based on a basket of key international currencies.