Regulatory Alert: New Requirements for Indonesian-Flagged Ships – Guarantee Funds for Oil Pollution Compensation
The Directorate General of Sea Transportation (“DGST”) as the Indonesian maritime regulatory authority, has issued a Circular Letter Number SE-DJPL 4 Of 2023 concerning The Obligation Of Indonesian Flag Vessels to have a Certificate for Oil Pollution Compensation Guarantee Fund and/or a Fuel Oil Pollution Compensation Guarantee Fund in Order to Ensure Seaworthiness (“CL 4/2023”). CL 4/2023 carried out the mandate on the obligation for obtaining certificate of prevention for oil pollution damage for certain Indonesia flagged vessels that was first introduced in Ministry of Transportation Number 29 of 2014 concerning Prevention of Maritime Environmental Pollution and its amendment (“MoT 29/2014”). CL 4/2023 features important changes concerning the liability and compensation mechanisms for oil and fuel oil pollution by ships.
This mandate has been introduced in the interest of affirming and ensuring ship seaworthiness. It also provides more details on the role DGST in issuing certificates of prevention for oil pollution damage.
Ships without the stipulated certificates may face operational restriction potentially impacting trade and shipping activities. According to CL 4/2023, harbormaster is authorized to delay the departure of ships to sail for failure to obtain certificates.
In addition to any potential compensation costs from pollution incidents, ship operators might need to consider additional financial provisions to obtain and maintain these certificates.
Non-compliance may lead to Port Clearance refusal or Port Clearance revocation.
If you operate an Indonesian-flagged ship, we recommend procuring the required certificates at the earliest to ensure uninterrupted operations.
Consider consulting with maritime legal experts to understand the nuances of the new requirements and the broader implications for your operations.
3. Engage with Authorities
It might be beneficial to engage directly with the maritime regulatory authority or relevant bodies to seek clarifications, if any.
This is a significant development for all stakeholders involved in the Indonesian maritime sector. We advise all our clients with operations or interests in the region to take cognizance of this change and act accordingly to ensure compliance and smooth operations.
 Number 5(a) CL 4/2023
 Ibid, Number 5(c).
 Ibid, Number 5(b); Article 39A(1) MoT 29/2014.
 Articles 39(1), 39(2), 39(3), 39(4) MoT 29/2014.
 Number 5(b) CL 4/2023
 Article 134 and Article 242 of Law Number 17 of 2008 concerning Shipping
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