- Supreme Court rules for $1B compensation over environmental catastrophe.
- Disaster involved major plastic and chemical pollution off Sri Lanka’s coast
- Vessel owners, operators, and agents held jointly liable under “Polluter Pays” principle.
Sri Lanka’s Supreme Court has delivered a landmark judgment, ordering the owners of a Singapore-flagged cargo vessel to pay US $1 billion in compensation to the government. The decision follows a devastating maritime disaster in 2021, which caused what the court described as the worst marine environmental damage in the country’s history, reports Barrons.
The vessel, which was carrying hazardous materials including nitric acid, plastic pellets, and heavy metals, caught fire and later sank off the coast near Colombo. The incident led to the release of pollutants along approximately 80 kilometers of Sri Lanka’s coastline.
Widespread Ecological and Economic Damage
The environmental toll was staggering. Authorities documented the deaths of 417 sea turtles, 48 dolphins, and 8 whales, alongside mass fish mortality and widespread damage to marine ecosystems. Coastal waters were heavily polluted by plastic nurdles and toxic substances, leading to severe disruptions in marine biodiversity and food chains.
The disaster also caused long-term economic hardship for fishing communities. A government-imposed fishing ban in the affected regions lasted more than a year, impacting the livelihoods of thousands of families who depended on the sea for income and sustenance.
Legal Responsibility and the Court’s Ruling
In its ruling, the court found multiple parties responsible, including the ship’s owner, charterers, operators, and the vessel’s local agent in Sri Lanka. All were held jointly and severally liable under the internationally recognized “Polluter Pays” principle. The court ordered the full amount of US $1 billion to be paid to the Sri Lankan Treasury within one year.
The decision emphasized that legal responsibility for environmental disasters must extend across the shipping and logistics chain—not just to the direct owner. It also highlighted Sri Lanka’s growing commitment to enforcing environmental accountability through the courts.
Previous Settlements and Ongoing Legal Action
Prior to this ruling, the shipping firm had voluntarily contributed US $7.85 million toward cleanup operations and support for affected fishing communities. However, a separate legal proceeding in the United Kingdom had previously limited the company’s liability to roughly £19 million (about US $25 million), a cap that Sri Lanka has actively appealed.
A related lawsuit filed in the Singapore International Commercial Court remains suspended, pending the outcome of the appeals process. Sri Lankan authorities have indicated they will pursue all available legal avenues to secure full restitution and environmental justice.
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Source: Barrons
