Confusion over stricter new liability guidelines under the Oil Pollution Act of 1990 could create troubled waters for cruise lines, petroleum companies and an array of other businesses that qualify as owners or operators of tankers, cargo ships and other large vessels visiting U.S. ports, according to a maritime law expert.

Jonathan Gutoff, an admiralty law professor at the Roger Williams University School of Law in Rhode Island, asserts many owner-operators are in the dark about the new standards or mistakenly believe that they'll enjoy the same limited liability under a now-outdated interpretation of OPA.

Enacted in 1990 on the heels of the Exxon Valdez oil spill disaster in Alaska, the law affects “anyone who operates a vessel with petroleum as its cargo or its source of propulsion” and “imposes liability not just for direct property damage and personal injury but for all the economic consequences of the environmental damages,” Gutoff said.

For years, the Coast Guard has interpreted OPA as requiring operators to contract with so-called “vessels of opportunity” that agree to respond to oil spills and fires—but only if they happen to be in the area and available, Gutoff said. He asserted the interpretation was “legally incorrect.”

The Coast Guard changed its position late last year, when it announced that OPA requires companies responsible for ships to “ensure by contract or other approved means that response resources are available to respond” to incidents.

The new guidelines appear to torpedo the traditional response plans that relied on vessels of opportunity, which would mean that ship owners, operators and subcontractors can no longer argue that they are entitled to limited liability under OPA because they made a good faith effort to respond to a maritime disaster, even when no response resources were available.

Now, legal departments for affected companies need to review contracts with oil spill response providers and “make sure that whatever provider the business selects is actually able to point to particular marine firefighting and salvage assets that are in place and able to respond within the time limits set by the regulations,” Gutoff said.  

He added the companies must also be able to identify those assets “and not simply say I promise to have necessary assets in place. You'd want to be able to point to particular vessels with firefighting capabilities and particular trained crew who had undergone regular firefighting drills.”

The new regulations haven't been tested in court. But Gutoff said if a company had a response plan that depended on vessels of opportunity and had an oil spill, “the proper legal result would be that they would not be able to limit their liability because they were out of compliance with the regulations.”

Proving limited liability for an oil spill was already difficult, according to John Giffin, the senior maritime shareholder in Keesal, Young & Logan's office in San Francisco. He has represented several oil companies in the wake of spills, including Cosco Busan's ship owner and manager after a 2007 oil spill in the San Francisco Bay.

“The government is very aggressive about challenging any attempt by a ship owner from limiting its liability under OPA,” Giffin said.

He added major oil companies operating in the Bay Area are likely prepared for the new regulations, because they “have been requiring that their response contractors conduct drills to make sure that they can respond timely under an oil spill.”

But that might not be the case in more remote areas where the resources that would be needed to respond to a major spill are scarce or nonexistent, according to Giffin. He cited the Lost Coast of Northern California as an example of an area that's unprepared.  

“It is a problem up there,” he said. “We've been dealing with that for a number of years.”