Dr. Sc. Adriana Vincenca Padovan, Adriatic Institute of the Croatian Academy of Sciences and Arts

RECOVERY AND REMOVAL OF WRECKS AND SUNKEN OBJECTS

ACCORDING TO THE

LAW ON AMENDEMENTS OF THE CROATIAN MARITIME CODE 2013

1. Introduction

The need for an amendment of the Croatian Maritime Code (further: the CMC) of 2004[1] in respect of the maritime law concepts of recovery and removal of wrecks and other sunken objects has been recognized due to the fact that there was a serious lack of positive law regulating the particular legal relationships arising in relation to the respective operations.

Namely, in Croatia, recovery of sunken objects, including compulsory wreck removal, had been regulated as a separate maritime law concept until 2004 under the Maritime Code of 1994, and prior to that, under the Yugoslav Law on Marine and Inland Water Navigation of 1978. In 2004 the entire chapter of the CMC dealing with the recovery of sunken objects and compulsory wreck removal was deleted, and no other provisions were introduced to replace them. Only a few basic administrative issues were partly regulated within the chapter on salvage,[2] the explanation being that the recovery of sunken objects is simply a form of salvage. Consequently, a legal lacuna was created.

On the other hand, it is interesting to note that the Law on Inland Navigation and Ports of 2007 has maintained a special chapter regulating the concept of the recovery of sunken objects, including compulsory wreck removal (similar to the old deleted chapter of the CMC 1994).

It is important to point out that the recovery of sunken objects and wreck removal are primarily administrative maritime law concepts regulating the relationship between the owner of wreck or other sunken object and the coastal state under whose jurisdiction the wreck or sunken object is located. On the other hand, salvage is primarily a private shipping law concept dealing with the relationship between the owner of the salved property and the salvor. Therefore, these maritime law concepts should not be confused.

2. Recovery and removal of wrecks and sunken objects under the amended CMC 2013

The new Chapter VI of the Part VIII (Articles 840.a – 840.z) of the CMC has been introduced under the title: Recovery and removal of wrecks and sunken objects. The chapter primarily consists of administrative law provisions regulating the relationship between the owner of the wreck or sunken object and the state as the coastal state under whose jurisdiction the wreck or sunken object is located. In addition, there are a minor number of private law provisions (including property law) dealing with the regime of third party liability and the liability for the costs of wreck removal of the owner of wreck or sunken object, the law of finds and some other private law implications of the abandoned wrecks or sunken objects.

Structurally, the chapter is divided into three sections:

I. General provisions

II. Provisions on the recovery of wrecks and sunken objects

III. Provisions on the compulsory removal of wrecks and sunken objects

2.1. General provisions

The general provisions section contains the legal definitions of wreck, sunken object, marine casualty, hazard, related interests (affected by the hazardous wreck or sunken object), removal, recovery, bona fide finder, etc. The said definitions to a high extent represent an implementation of the definitions from the Nairobi Wreck Removal Convention 2007 (further: the WRC). Although the WRC has neither entered into force nor been ratified by Croatia, the solutions adopted therein were considered adequate and desirable for the Croatian legal system. In addition, several entirely new definitions relating to the voluntary raising and recovery of wrecks and sunken objects and the law of finds were added. It is hereby clarified that according to the new definitions, the term wreck is equally defined as under the WRC, i. e. it corresponds to all sorts of maritime wreck (vessels, ship cargo, parts thereof), whereas the term sunken objects relates to all other sorts of objects that may be sunken, lost or stranded at sea regardless of maritime casualties.

As regards the territorial scope of application of the respective provisions, it has been established that the provisions on the recovery (voluntary raising) of wrecks and sunken objects shall apply in the territorial sea and internal waters, whilst the compulsory removal provisions shall apply in the territorial sea, internal waters, continental shelf and the eco-fisheries zone.

The CMC now prescribes an absolute obligation of the owner to remove the wreck or a sunken object, and applies a regime of strict third party liability for damage arising from the breach of such an obligation.

Furthermore, there is a general duty imposed on all persons having any knowledge of a wreck or a sunken object to report such wreck or sunken object to the public authorities. Any unauthorized interference with a wreck or a sunken object is strictly forbidden.

According to the new provisions, wrecks and sunken objects remaining in the sea for more than two years become the property of the state.

Some additional public protection is provided for the historical, cultural and military wrecks.

2.2. Provisions on the recovery of wrecks and sunken objects

The second section of the respective chapter deals with the voluntary raising and recovery of wrecks and sunken objects, where there is no element of hazard for the environment and safety at sea, i.e. where there is no compulsory order of a public authority to remove or raise a wreck or a sunken object. These provisions establish an administrative procedure regulating the relationship between the owner of the wreck or sunken object that voluntarily undertakes the raising, i.e. the recovery operations, and the state authorities. The important distinction compared to compulsory removal is that in these cases there is no determination of hazard. The administrative provisions deal in particular with the licensing and supervision of the respective operations.

Furthermore, there are special provisions dealing with the law of finds regarding the lost or abandoned wrecks and sunken objects. A special procedure is established for the raising and recovery operations undertaken by the public authority and by the bona fide finder of the wreck or sunken object. The rules on the custody of the wreck or sunken object recovered by the public authority or bona fide finder are envisaged, as well as the acquisition of ownership over the abandoned wreck or sunken object by the bona fide finder. Due respect is paid to the minimal protection of the original (unknown) owner's rights through the provisions on notification, service of documents and the periods of prescription.

The rules on the sale of the recovered abandoned wreck and sunken object in a public auction are introduced, including the rules on the court deposit and distribution of the proceeds.

The liability of the contractor performing the recovery operations is presumed and based on fault (ordinary negligence). The contractor's claim for the price of his services is secured by the lien and the right of retention of the recovered wreck or sunken object.

2.3. Provisions on the compulsory removal of wrecks and sunken objects

The section on the compulsory removal of wreck and sunken objects largely implements the solutions adopted in the WRC, plus it extends to the compulsory removal of all other sorts of sunken and stranded objects representing a hazard to the environment or safety at sea, not only maritime wrecks, i.e. wrecks as defined under the WRC.

There are special administrative law provisions regarding the procedure of determination of hazard by the competent public authorities and provisions dealing with the procedures of the reporting on, locating, marking and removal of wrecks and sunken objects. In particular there are detailed rules on the issuing and notification of the order for removal to the owner, the approval of the removal operations by the competent authorities, their right to intervene in those operations and to undertake them on their sole initiative in urgent cases or where there is no timely response by the owner.

As regards the private law implications of the compulsory removal of wrecks, a regime of strict liability of the owner is introduced for the costs of removal operations, equal to the one adopted in the WRC, coupled with compulsory insurance and the right of direct action against the insurer. The insurance is compulsory for all vessels over 300 GRT. There is no limitation of the owner's liability for the removal costs, whereas the insurer’s liability is limited to the same amounts of limitation of liability as prescribed by the International Convention on Limitation of Liability for Maritime Claims 1976 as amended by the Protocol of 1996.

Likewise, there is a strict and unlimited liability of the owner for the costs of the compulsory removal of hazardous sunken objects; however, for obvious reasons, there is no compulsory liability insurance prescribed in respect of these objects.

The state’s claim for the costs of compulsory removal is additionally secured by the state’s lien and the right of retention of the removed wreck or sunken object. There are special provisions regulating the sale of the removed hazardous wrecks and sunken objects in a public auction, including the rules on court deposit and distribution of the proceeds of such sale. The said state's security rights rank higher than the maritime liens prescribed by the CMC.

The contractor's third party liability is presumed and based on fault.

The state's claim to recover the costs of compulsory removal shall be extinguished unless an action is brought within five years from the date when the hazard has been determined. In no case shall an action be brought ten years after the date when the competent authorities became aware of the wreck or sunken object.

3.Removal of substandard ships

It is important to distinguish the provisions on compulsory wreck removal presented above from the Article 171 of the CMC dealing with the compulsory removal of substandard ships. Namely, whilst wreck is defined as resulting from a marine casualty, substandard ships are identified as such in the process of the ship safety inspection, e.g. through port state control. According to the CMC as amended in 2013, it shall be ordered that such substandard ships be removed at the cost of their owners. The state is entitled to intervene and to remove such a ship when there is no timely response from the owners or in the case of emergency when such a ship poses an imminent hazard to the environment or safety at sea.

The removal may include the sale of the ship in a public auction. Special rules regulating the notification, preclusive periods, distribution of proceeds and court deposit of the excess of the proceeds are envisaged.

The state has a lien on the removed ship to secure the claim for the costs of removal.

4. Marine offences

Certain breaches of particular provisions relating to recovery and removal of wrecks and sunken objects by owners, masters, finders and contractors are defined as marine offences, and adequate fines are prescribed.

5. Conclusion

An entirely new chapter of the CMC dealing with the recovery and removal of maritime wrecks and other sunken objects has been introduced by the Law on Amendments of the Maritime Code of 2013, to eliminate the legal lacuna that was created in 2004, when the provisions dealing with the recovery of sunken objects including the compulsory removal of wrecks were deleted from the CMC. The new provisions fully regulate the concepts of the recovery of maritime wrecks and other sunken or stranded objects, and of the compulsory removal of hazardous wrecks and sunken objects. Besides the predominantly administrative law provisions, necessary rules of private law are envisaged to address the issues of acquisition and prescription of the proprietary interests over the abandoned or lost wrecks and sunken objects, as well as of the liability for the costs of compulsory removal and for the damage caused by the wreck or sunken object, or in relation to the operations of their recovery or removal. Furthermore, there are provisions dealing with the security rights and the enforcement of claims arising in relation to the concepts of the recovery and removal of wrecks and sunken objects.

The concept of compulsory removal as adopted in the new CMC provisions to a high extent implements the solutions envisaged by the WRC, although this convention has neither entered into force nor been ratified by Croatia. Nevertheless, the Croatian legislator found it adequate and desirable to rely on the WRC solutions and apply them with some minor modifications in the national maritime law, extending them also to other sorts of sunken objects, besides maritime wrecks. The provisions addressing the recovery of wrecks and sunken objects were inspired by the idea of creating an incentive for the specialised and adequately equipped entrepreneurs to engage into the operations of raising the abandoned wrecks and sunken objects on a commercial basis. It is hoped that the overall result of these newly adopted provisions will represent a considerable progress in the protection of marine environment in the Adriatic Sea.

1

[1] The Maritime Code of the Republic of Croatia, Narodne novine no. 181/2004, 76/2007, 146/2008, 61/2011.

[2] Only a couple of administrative law provisions were kept to assure that the state is entitled to intervene in the salvage operations when there is an element of hazard for the environment or safety at sea in broader terms.