A special international regime for nuclear third party liability is necessary since ordinary common law is not well suited to deal with the particular problems in this field. The drafters of the Paris Convention set out to provide adequate compensation to the public for damage resulting from a nuclear accident and to ensure that the growth of the nuclear industry would not be hindered by bearing an intolerable burden of liability.
The Convention establishes a special legal regime founded on a number of important principles:
The Paris Convention provides for compensation for injury to or loss of life of any person, and for damage to, or loss of any property caused by a nuclear accident in a nuclear installation or during the transport of nuclear substances to and from installations. It does not cover damage to the nuclear installation itself.
Nuclear installations are defined as: reactors other than those comprised in any means of transport; factories for the manufacture or processing of nuclear substances, for the enrichment of uranium, and for the reprocessing of irradiated nuclear fuel; and facilities for the storage of nuclear substances. Facilities which do not involve high levels of radioactivity, such as those for uranium mining and milling and for the production of radioisotopes, are covered by general tort law rather than the Convention.
The Paris Convention also applies to nuclear substances in transport from one nuclear operator to another. Liability is, in principle, imposed on the operator sending the nuclear substances since it will normally be responsible for its packing and containment. In the case of transport to or from operators in states which are not party to the Convention, special provisions apply to ensure that an operator to which the Convention regime applies will be liable.
The Paris Convention generally applies when an accident causing damage occurs in the territory of a party and damage from this accident is suffered in the territory of a party, including the territorial sea. In 1968, the NEA Steering Committee recommended that the Convention cover nuclear incidents occurring or nuclear damage suffered on the high seas and in 1971, it recommended that the Convention apply to damage suffered in a Paris Convention state even if the nuclear incident occurs in a state not party to the Convention. Many of the Paris Convention states have adopted these recommendations.
The Paris Convention was adopted under the auspices of the OECD Nuclear Energy Agency and covers most Western European countries. It is open to any OECD country as of right and to any non-member with the consent of the other contracting parties.
The OECD Secretary-General is depositary for the Paris Convention.
*The unit of account used in the Paris Convention is the Special Drawing Right, a unit of account defined by the International Monetary Fund (IMF) based upon a basket of key international currencies. The currency value of the SDR is calculated daily and the valuation basket is reviewed and adjusted every five years.
Last reviewed: 7 November 2014