Civil Liability for Nuclear Damage: Indian and International Perspectives

India’s Position

The concept of civil liability for nuclear damage is embodied in The Civil Liability For Nuclear Damage Act, 20101 . The Act defines the ‘operator’ as the Central Government, any authority or corporation established by the government or a Government Company who has the license granted by the government. Nuclear Installation has been construed to include a nuclear reactor except mobile nuclear reactors because nuclear reactors used in transport, especially military vessels, are covered under maritime and defence laws and not civil liability. Apart from this, it includes any facility using nuclear fuel for production, processing or re-processing of nuclear material and a facility used to store nuclear material, excluding storage which is incidental to transport of such material. Nuclear Material includes nuclear fuel except uranium that can produce energy by a self-sustaining reaction and radioactive products and waste. Nuclear Damage has been given a very wide definition which includes loss of life, injury, damage to property, economic loss arising from such loss or damage, loss of income due to damage to an environment used for deriving such income, costs of preventive measures and any other economic loss permitted under the general law of civil liability. This widens the rules for establishing liability on the operator.

Section 4 of the Act provides for fixed rules to establish liability so victims are not left confused about whom to sue. Normally, the operator of an installation is liable when the nuclear incident is caused in an installation or involves nuclear material originating from that installation before the liability has been assumed by another operator. Furthermore, it gives specific situations in case the material is being moved from one place to another.

(i) If material is being sent from one place to another, the sending operator is liable until the receiving operator accepts liability through a written agreement.

(ii) If the operator who is supposed to receive the material physically takes charge of it, liability shifts onto that operator.

(iii) If material is taken from a ship, submarine or any transport that uses nuclear reactor as a power source, the moment the operator takes charge of it, liability stands transferred.

(iv) If material is being imported and is loaded on a transport from a foreign country with written consent of the operator, liability starts from that point itself. Even before it enters India, liability is fixed.

This section provides for liability on no-fault basis which ensures that the victims receive compensation without any burden of proving negligence on the part of the operator. If multiple operators are involved in the damage, liability is joint and several i.e. the victim can claim the entire amount from any one of them 1 The Civil Liability For Nuclear Damage Act 2010 also, if the other is not in a state to pay or refuses to pay. The one who has paid can later claim the amount due to him through a separate action against him. These provisions reflect that the legislation has been enacted for social welfare.

Section 6 provides for the amounts payable as compensation by the operators. The upper mark for liability has been fixed at three hundred million Special Drawing Rights, but may be increased by the Central Government. Nuclear reactors having thermal power equal to or above 10 MW shall pay one thousand five hundred crores, fuel reprocessing plants shall pay three hundred crores and research reactors having thermal power below 10 MW shall pay one hundred crores. The Government retains the right to review the amounts and increase them, if required. This provision stipulates exemplary amounts which may be increased with regards to the extent of damage, thereby, allowing flexibility.

Section 7 provides that the Government shall be liable in cases of liability of operator exceeding that specified in Section 6, or if an incident occurs in an installation owned by it, or occurs due to a grave natural disaster or an act of armed conflict, war, terrorism etc. It also allows the government to assume full liability for an installation not operated by it, if public interest so requires. Section 8 requires the operator to insure himself or take financial security for any future damage, and renew it from time to time. The case is adjudicated by the Claims Commission and the award made by it is final.

Section 17, however, provides a remedy to the operator, after he has deposited the award if, such right is expressly mentioned in the contract, or the incident resulted due to sub-standard or defective equipment being delivered by the supplier or it resulted from an act done with the intention to cause such damage. This reflects India’s unique position because India is one of those few countries which has provision for supplier liability, marking a departure from international practice. India adopted this because the Bhopal Gas Tragedy created a deep distrust of corporations escaping liability. The Parliament wanted the suppliers to be accountable. Incidents like the Three Mile Island Disaster, Chernobyl and Fukushima Disaster are testimonies to this concern because they took place either due to faulty equipment or substandard services provided by suppliers.

Section 46 is another controversial section of the act, which states that even after compensation is paid under this act, victims may still have the right under tort law, environmental law, criminal law or other constitutional remedies. This breaks another international law principle that nuclear liability law should be the sole remedy. Under international law, once compensation has been paid under the law, there cannot be any further suits or proceedings. Yet section 46 allows for this possibility leading to legal uncertainty, fear among foreign investors and insurance complications. Suppliers opposed this since they were made to pay under nuclear liability law in addition to other laws. India swiftly responded that the purpose is to ensure environmental safety and protect victim’s constitutional rights.

International Position

1. Vienna Convention on Civil Liability for Nuclear Damage, 1963

This convention was enacted to establish benchmarks for providing compensation against damage as a result of peaceful use of nuclear energy and develop friendly relations among nations. The provisions of India’s CLND Act conform to this barring two exceptions.

1. No-Fault Liability: Both conventions allow for compensation without requirement of any proof of negligence. However, proof of causation is required i.e. liability arises once it is shown that a nuclear incident occurred and damage resulted from that.

2. Jurisdiction: Under Vienna Convention, only courts of the installation state have jurisdiction. In India, jurisdiction lies with Claims Commission and civil courts cannot entertain these cases. Both concentrate jurisdiction to allow better handling of cases.

3. Limitation and Financial Security: Vienna Convention allows states to limit operator liability and requires them to maintain insurance and financial security, similar to India.

Section 17 and 46 conflict with this because it limits liability only to operators and compensation only under this act.

2. Convention on Supplementary Compensation for Nuclear Damage, 19974

India is a signatory to this Convention. It does not talk about who is liable but about how victims can get more compensation if an accident is very large. It creates an international compensation fund in addition to the operator’s liability. The purpose is that when a nuclear incident is very serious and operator’s liability fixed under national law is not sufficient, victims can turn to international fund. Article III introduces a twotier compensation mechanism, first being the national compensation. When it is exhausted, an international fund comes into play. All Party States contribute to it in proportion to their installed nuclear capacity and their UN rate of assessment. This makes the burden of compensation collective and international, rather than solely on the victim state.

CSC also does not align with Sections 17 and 46 yet India choose to sign it because it of political and diplomatic reasons. It links India to the global nuclear liability framework, reassures foreign investors that India follows international norms and gives access to the international fund. Moreover, it is more flexible than Vienna convention which requires direct adoption of the model. CSC allows countries to keep their own national laws as long as they broadly follow nuclear liability principles.

Conclusion

India’s hybrid model of signing CSC and retaining Sections 17 and 46 in CLND is a great example of balancing both international cooperation and its domestic concerns of justice and accountability.