Author(s): Yushan Bai
Paper Details: Volume 4, Issue 4
Citation: IJLSSS 4(4) 04
Page No: 33 – 41
ABSTRACT
A considerable number of shipping containers are lost at sea yearly, with the international maritime law viewing them as property loss and physical navigational hazards. However, recent incidents that have resulted in the spillage of plastic pellets (nurdles) and toxic chemicals have demonstrated that container loss can lead to substantive ecological disasters. This paper analyses the legal paradigm shift that coastal states are undertaking in response to the emerging cause of marine pollution, classifying these incidents as offenses. The paper examines the application of aggressive domestic absolute liabilities in the cases of MSC Zoe and X-Press Pearl and rejection of UNCLOS and MARPOL Annexes III and V. Through the analysis, the paper highlights the existing legal friction regarding the reclassification of accidental cargo loss as illegal discharge of garbage. Furthermore, analysis of the recent regulatory amendments through MEPC.384(81) alongside the cases of MSC Zoe and X-Press Pearl, the paper concludes that because of persistent loopholes in international maritime law, sovereign states will likely continue to apply absolute liability to polluters.
Key Words: MARPOL, Container loss, Plastic Nurdles, UNCLOS, Marine pollution, X-Press Pearl
INTRODUCTION
The global supply chain is inextricably connected to maritime transport with overreliance on ultra-large container vessels (ULCVs) for packaging and transportation. The sheer volume of modern shipping has, however, exacerbated the risk of cargo loss during loading, unloading, or freight movement. The World Shipping Council (WSC, 2025) reports that the containers lost at sea for the year 2024 were approximately 576. While the number of containers lost at sea has decreased in comparison to the 10-year average of 1,274 containers, the WSC (2025) indicates that the loss is influenced substantively by geopolitical shifts in global trade patterns. For example, the disruptions on maritime transport through the Red Sea occasioned by the attacks on merchant ships have forced a 191% increase in merchant ships opting to reroute to the Cape of Good Hope. This alone led to the loss of 200 containers along the Cape of Good Hope region for the year 2024 (WSC, 2025).
The historical approach that international maritime law has had towards the accidental loss of shipping containers is to consider them as a matter of property loss, physical navigational hazard, and cargo liability. This approach is based on the Nairobi International Convention on the Removal of Wrecks (International Maritime Organization [IMO], 2007), whose main focus was the locating, marking, and removing sunken cargo or vessels to maintain safety across shipping lanes. However, the Nairobi Convention does not provide legal and commercial mechanisms to address the catastrophic ecological devastation caused by modern container spills. Jo (2020) notes that extreme navigational challenges exemplified by head-sea parametric rolling, result in vessels violently ejecting cargo into the ocean. Upon sinking or rupture of these containers, consequences extend beyond physical damage into ecological damage. According to Wan et al. (2022), container ship accidents are definitive critical sources of emerging marine pollution. This is because the ruptured containers crush seabed habitats while possibly releasing pollutants such as toxic industrial chemicals, and microplastics (Wan et al., 2022). Hence, the traditional salvage laws remain fundamentally inadequate when it comes to addressing environmental damage caused by container loss at sea. This review article analyses the contemporary legal transition in reference to container casualties. The paper argues that there has been a substantive shift in the legal definition of a lost container from a commercial maritime casualty to a prosecutable environmental offense. Furthermore, the paper demonstrates how coastal states are forced to bypass traditional liability caps and impose strict environmental liability on the shipping industry due to the failure of international treaties in addressing the emerging marine pollution.
MATERIALS AND METHODS
Considering the conceptual nature of this review paper, the doctrinal legal research methodology is utilised to trace the evolution of maritime liability concerning container loss. Foundational materials analysed include the primary environmental laws and maritime treaties. The United Nations Convention on the Law of the Sea (UNCLOS) and the International Convention for the Prevention of Pollution from Ships (MARPOL) are examined and contrasted with the Nairobi International Convention on the Removal of Wrecks (IMO, 2007). In addition, the research also incorporates recent regulatory amendments to Protocol I of MARPOL adopted by IMO during the MEPC.384(81) Resolution in 2024 (IMO, 2024).
In a bid to bridge the gap between theoretical treaty frameworks and practical enforcement, a qualitative analysis of recent institutional reports and legal mechanisms at the state level is utilised. It comprises the evaluation of empirical container loss data as reported by WSC (2025), analysis of the United Nations Environmental Programme’s (UNEP) advisory mission reports regarding X-Press Pearl disaster (UNEP, 2021). Furthermore, the paper undertakes a critical review of policy submissions to the MEPC 84 sessions by non-governmental organisations who are focused on environmental pollution and conservation within the marine system (FOEI et al., 2024). Focus is directed towards a comprehensive assessment of the landmark judgement from the Supreme Court of Sri Lanka regarding the X-Press Pearl case in 2025. Through the synthesis and analysis of scientific publications, legal texts, and real-world jurisprudence, the paper isolates specific ambiguities within the current legal frame that shipowners are exploiting while demonstrating how national judiciaries are implementing strict liability precedents.
DATA ANALYSIS: THE ENVIRONMENTAL LIABILITY PARADIGM
UNCLOS AND DUTY TO PROTECT
UNCLOS provides a foundational aspect to maritime law. It establishes obligations that extend beyond traditional, narrow definitions of maritime trade. For example, Article 192 obligates coastal states with the responsibility of protecting and preserving the marine environment (UN, 1982). Article 194 enhances this obligation by requiring the coastal states to prevent, reduce, and control pollution within the marine environment (UN, 1982). This calls on the states to ensure that activities occurring within their jurisdictions do not result in damage through pollution of neighbouring state’s marine environment (UN, 1982).
The maritime industry has continuously attempted to differentiate accidental loss of shipping containers from the broad environmental obligations and mandates by framing these losses as navigational hazards and unpreventable commercial casualties. However, the current interpretation seeks to challenge this differentiation according to Wan et al. (2022). Wan et al. (2022) indicate that upon rupture of the lost containers at sea, their impact extends beyond physical seabed obstruction as they constitute a substantive, multifaceted source of marine pollution. Furthermore, their impact includes physical destruction of sensitive marine habitats while in some cases, rupture may release organic pollutants, heavy metals, toxic industrial chemicals, and microplastics (Wan et al., 2022). As captured by Zhang et al. (2023), the loss of cargo due to mis-declared contents, inadequate stowage, and poor packing leads to collapse of localized ecosystems.
Since the loss of containers at sea actively introduces hazardous synthetic materials into marine habitats, real-world context necessitates legal reinterpretation of UNCLOS obligations to shipowners. For example, when loss of containers is triggered by harsh weather or parametric rolling, it represents a violation of Article 192 of the UNCLOS mandate which is to protect and preserve the marine environment. As such, failure by flag states and shipowners to implement adaptive rerouting to avoid severe weather conditions or implement adequate stowage measures cannot be considered an “Act of God” as historically done. Guided by scientific research by Wan et al. (2022) and Zhang et al. (2023), coastal states are asserting strict liability for preventable dropping of cargo since it is a breach of the duty to protect the marine environment under UNCLOS. Consequently, the legal reinterpretations provide a theoretical bridge that shifts unavoidable navigational accidents to transboundary environmental breach demanding comprehensive redress.
MARPOL’S APPLICABILITY AND EXISTING REPORTING LOOPHOLES
MARPOL provides the primary technical mechanism intended to regulate and prohibit specific polluting activities in a bid to bolster the overarching mandate that shipowners have to protect marine environment under UNCLOS. Annex III of MARPOL is specifically targeting the packaging of harmful substances, while Annex V is focused on prohibition of the discharging of garbage – which includes all classifications of plastics – into the marine environment (IMO, 1973/1978). However, there is a significant gap in the application of MARPOL when it comes to the accidental loss of shipping containers which coastal states have to grapple with.
Legal ambiguity in the application of MARPOL to the accidental loss of shipping containers arises from the definitional interpretation of “discharge” and “accidental loss.” Historically, MARPOL was drafted to regulate the intentional and deliberate dumping of waste. As a result, shipowners have argued that containers lost at sea due to severe weather events do not qualify as illegal discharge of garbage as described in Annex V of MARPOL. Instead, shipowners cite that the loss was unintended since the containers were meant for delivery as opposed to disposal. With specific reference to plastic nurdles, CE Delft (2023) highlights that the legal deflection is problematic because preventing plastic pellet spills is not enforceable since plastic pellets do not have a specified UN number under the International Maritime Dangerous Goods (IMDG) Code. This leads to a lack of strict, and mandatory packaging and stowage practices under MARPOL’s Annex II. Consequently, shipowners argue that the lack of classification of the plastics as harmful elements cannot be prosecuted under illegal discharge of hazardous waste (CE Delft, 2023).
Analysis also indicates that the response from the international community to this legal loophole remains underwhelming. IMO adopted the MEPC.384(81) regulations in 2024 with the aim of amending Protocol I of MARPOL so that ship masters are mandated to report lost freight, and transmit relevant danger messages regarding the potentially hazardous nature of the lost goods (IMO, 2024). In addition, IMO went on to publish regulatory guidelines – though non-binding – that detail proper cleaning practices for pellet spills (IMO, 2025). However, the MEPC 84 session has been criticised because mere reporting and post-release guidelines do not address the basis of pollution (FOEI et al., 2024). The criticism argues that for the persistent nature of pellet pollution, prevention is superior to clean-up (FOEI et al., 2024). A proposed remedy is the classification of pellets as hazardous materials to make their disposal a legal liability so that it prevents dumping in oceans (FOEI et al., 2024). Thus, without consequential liabilities, MARPOL will remain restricted by its existing loopholes that allow shipowners to exploit the definitional gaps between a catastrophic event and commercial accident.
COASTAL STATE ENFORCEMENT AND STRICT LIABILITY (THE X-PRESS PEARL AND MSC ZOE)
The persistent legal ambiguities that have characterized international treaties as discussed have forced coastal states to rely on their domestic legal frameworks to enforce accountability on shipowners. For example, traditional maritime defences such as “perils of the sea” are being bypassed by the coastal nations in favour of applying the “Polluter Pays” principle as well as the strict liability doctrine in a bid to address the slow pace at which international tribunals are addressing the emerging problem. This paradigm shift is starkly evidenced in the MSC Zoe disaster of 2019 in which a vessel lost more than 340 containers in the North Sea (Saliba et al., 2022). As reported by Saliba et al. (2022), the MSC Zoe incident resulted in the spilling of plastics that included 22.5 tonnes of polymeric beads into the Wadden Sea, a UNESCO World Heritage Site. A remedy pursued by Germany and the Netherlands for the MSC Zoe incident was the rejection of the characterization of the incident as an unavoidable “Act of God” in favour of enforcement of strict liability under their domestic frameworks (Saliba et al., 2022). Doing so forces shipowners to absorb the exorbitant cost of cleaning microplastics across multinational coastlines.
The devastating impact that the X-Press Pearl catastrophe had off the coast of Sri Lanka in 2021 is another demonstration of coastal states rebelling against the limited international conventions. According to UNEP (2021), the X-Press Pearl catastrophe vessel had inadequately declared carrying nitric acid which leaked during transit resulting in a fire breaking out and ultimately sank the vessel. The catastrophe released 70 to 75 billion plastic nurdles, and toxic chemicals resulting in a substantive environmental damage (UNEP, 2021). Furthermore, UNEP (2021) reports that clean-up efforts were severely hindered by prevailing monsoon weather as well as operational challenges that led to the spread of the pollutants across a vast area leading to widespread damage to coral reefs, sensitive mangroves, and coastal fisheries. Sri Lankan authorities opted to treat the incident as a monumental environmental offense that required aggressive domestic adjudication as opposed to conventional wreck removal operations that are guided by maritime salvage laws.
In 2025, the Supreme Court of Sri Lanka delivered a landmark judgement unequivocally declaring that the incident infringed on the Sri Lankan citizen’s rights to a clean and safe environment (Supreme Court of Sri Lanka, 2025). In explaining the judgement, Supreme Court of Sri Lanka (2025) bypassed standard maritime liability caps that historically limit financial exposure based on the vessel’s tonnage. Furthermore, the Court noted the gross neglect in transportation of hazardous materials adopting a standard of absolute liability (Supreme Court of Sri Lanka, 2025). This ruling also established that enterprises involved in the transportation of hazardous chemicals – such as maritime transit of toxic chemicals and plastic polymers – be obliged with a non-delegable duty to the impacted coastal state so that they ensure no ecological harm occurs. Analysing the judgement also indicates that the Sri Lankan Supreme Court applied the “Polluter Pays” principle thus penalizing the firm US$ 1 billion (Supreme Court of Sri Lanka, 2025). Hence, sovereign states are no longer constrained by the limited navigations hazard paradigm and are likely to implement absolute liability to ensure that commercial shippers are motivated to be environmentally conscious.
CONCLUSION
The past decade has witnessed a paradigm shift in the legal principles governing the loss of commercial shipping containers. This change has been necessitated by the inadequacies of international maritime law that has continued to treat lost cargo as mere property loss or localized navigational hazards to be governed only by standard salvage conventions. However, the staggering volume of toxic chemicals, persistent release of microplastics, and organic pollutants into the marine environment forces coastal states to have vital redefinition of accidental container loss and the emerging form of marine pollution. Foundational frameworks such as UNCLOS have presented a non-delegable duty to protect and preserve the marine environment but the MARPOL convention that is designed to provide technical guidelines remains fragmented. For instance, Annex III and Annex V of MARPOL do not provide adequate redress to modern cargo spills because of their inherent systemic definitional loopholes. The continued lack of classification of highly polluting substances such as plastic nurdles in the IMDG Code gives shipowners adequate ability to exploit legal ambiguity between commercial accidents and illegal environmental discharge. This paper demonstrates that sovereign coastal states are actively closing the regulatory gap by applying domestic adjudication. The active rejection of “perils of the sea” defence in favour of “Polluter Pays” principle, coastal states are implementing constitutional environmental rights as exemplified by the X-Press Pearl and MSC Zoe disasters. Hence, commercial shipping companies can no longer externalize the substantive ecological costs of their lost cargo.
RECOMMENDATIONS
To bridge the identified gaps, it is recommended that the international maritime community should transition from reactionary remedies to proactive and preventive governance.
- Firstly, IMO must amend the IMDG code to assign a specific UN number to plastic pellets and polymeric materials (CE Delft, 2023) which will trigger legal, mandatory obligations regarding their stowage and packaging according to MARPOL Annex III. This will close the definitional loopholes currently shielding shipowners from liability.
- Secondly, IMO has to transcend the voluntary framework given by MEPC 84 conference and implement a legally binding and dedicated code (FOEI et al., 2024). The code should prescribe adequate below-deck stowage of the plastic nurdles to prevent atmospheric ejection.
- Thirdly, it is recommended that all containers be fitted with a mandatory telemetry and tracking device during transportation of hazardous materials. This will aid in rapid accountability and localization of spills which is paramount to the prevention of widespread pollution and damage.
- Fourthly, the international maritime liability framework should be systematically restructured because the traditional principles are no longer adequate. For instance, the traditional financial caps linked to vessel tonnage are not sufficient to cover costly ecological damages during spills. Possibly, the introduction of mandatory levies on commercial shipping to fund ecological restoration may be necessary to support coastal nations in their efforts to protect and preserve the marine environment.
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