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Pemmaraju Sreenivasa Rao, International Liability for
Transboundary Harm, 34 Envtl. Pol'y & L. 224
(2004)

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224
UN/ILC
International Liability for Transboundary Harm
by Pemmaraju Sreenivasa Rao*
Introduction: The Need for an International
Liability Regime
It may be recalled that for a long time the question of
international liability for transboundary harm was gener-
ally unregulated in international law. Where States engaged
in nuclear test activities on the high seas, for example, no
responsibility or liability was accepted for damage caused
to persons and property. Only ad hoc compensation was
paid ex gratia. Payment of compensation was regarded as
ex gratia, because activities engaged in were considered
necessary for security and lawful. 2 It was contended that
they were lawful in the absence of any express prohibi-
tion agreed upon by States. Similarly, when the smelter at
Trail in Canada caused harm in Washington State in the
US, the matter of compensation was settled by arbitration
between the US and Canada. The activity itself was not
considered unlawful or prohibited, but was allowed to
continue under controlled conditions to avoid further and
future transboundary damage.3 The case since then is cited
as authority to hold that every State should ensure that
activities within its territory or control are so conducted
as not to cause serious harm in
another State or in areas beyond
national jurisdiction. 4
The Latin maxim sic utere
tuo ut alienum non laedas indi-
cates that, at least in some na-
tional legal systems, this obliga-
tion has been recognized even
before the award in the Trail
Smelter Arbitration. It was reiterated by Principle 21 of
the 1972 Stockholm Declaration and Principle 2 of the
1992 Rio Declaration. The International Court of Justice
(ICJ) in its advisory opinion of 8 July 1996 on the Legal-
ity of the Threat or Use of Nuclear Weapons case stated
that this principle 'is now part of the corpus of interna-
tional law relating to the environment'.
Principles 2 and 21 have in turn generated several
important legal principles, such as the principle of pre-
ventive action, the principle of cooperation, principle of
sustainable development, the precautionary principle, the
polluter-pays principle, the principle of common but dif-
* Additional Secretary and Legal Adviser, Ministry of External Affairs, Gov-
ernment of India (1975-2002) (retired), Member, International Law Commission
(1987-), Associate Member, Institute of International Law (1999-). The views
expressed in this article are the author's alone and do not reflect the views of the
ILC or any other body with which the author is or was associated.
0378-777X/04/$17.00 @ 2004 lOS Press
ENVIRONMENTAL POLICY AND LAW, 34/6 (2004)
ferentiated responsibility, and the principle of inter-
generational or intra-generational equity. Several decla-
rations and draft principles and the efforts of the United
Nations Environment Programme (UNEP), the United
Nations Conference on Environment and Development
(UNCED) and the ILC have given some solidity and fur-
ther content to these principles. While some of these prin-
ciples, particularly the principle of prevention and coop-
eration, may be regarded as rules of customary law, not
all belong in that category. Even then, principles of li-
ability and compensation in cases of transboundary dam-
age are not well developed and the State practice and treaty
formulations at the global level continue to show varia-
tion and disparity in content. Approaches to State or pri-
vate operator liability, strict or fault liability, liability for
damage to persons or property or liability to environment
per se or liability for global commons appear to differ
widely both on policy and substantive as well as on pro-
cedural levels.
Against the above background, after nearly 27 years
of work, the International Law Commission adopted, on 5
August 2004, on first read-
ing, a set of eight draft prin-
ciples on international liabil-
ity. The commentaries were
in the nature of explanation
mn of the scope and context of
each draft principle as well
as an analysis of relevant
trends and possible options
which States may consider for the development of their
own national regimes on liability.' The ILC plans to com-
plete the second reading of the draft principles by the end
of the present quinquennium in 2006. Together with the
draft articles on prevention which it adopted after the sec-
ond reading in 2001,' the work of the ILC on the topic of
international liability is now poised for completion of a
comprehensive regime on international liability.
When the topic of international liability was first put
on the ILC's agenda in 1978, the main focus was on li-
ability, although principles of prevention were considered
as part of the exercise. However, it was proposed that fail-
ure to perform obligations of prevention would not trig-
ger any responsibility or liability unless actual damage
occurred, as part of the consequences for causing trans-
boundary damage. This approach caused considerable dif-
ferences in position both within the Commission and
ENVIRONMENTAL POLICY AND LAW, 34/6 (2004)
among States and prevented the Commission from mak-
ing rapid progress. To facilitate progress, the Commis-
sion took a decision in 1992 to separate the two aspects
and give priority to the development of a legal regime on
prevention, before deciding on the future course of action
concerning the liability portion of the topic. Some States
and a few members of the ILC were not in favour of the
Commission proceeding to consider the matter of liability
after completing the regime on liability.
State Responsibility and International
Liability: Related but Distinct Branches of
International Law
The International Law Commission first identified the
need for a separate topic on international liability in the
course of its work on State responsibility for internation-
ally wrongful acts. The Commission concluded that '[it]
fully recognizes the importance, not only of questions of
responsibility for internationally wrongful acts, but also
of questions concerning the obligations to make good any
harmful consequences arising out of certain lawful activi-
ties, especially those which, because of their nature, present
certain risks'. However it felt that the latter category of
questions 'cannot be treated jointly with the former'.' Mr.
Robert Ago, Special Rapporteur on State responsibility,
described that the nature of issues falling under this latter
category derived their legal basis from 'responsibility for
risk'.9 This gave rise to the inclusion in the agenda of the
Commission of a separate topic on international liability
for injurious consequences arising from acts not prohib-
ited by international law, which has been on the agenda of
the International Law Commission since 1978.10
Several of the initial years of the Commission were
consumed in identifying the precise title and scope of the
topic. First it had to be distinguished from the topic of
State responsibility for wrongful acts. The phrase 'not pro-
hibited by international law' was chosen instead of, for
example, 'lawful acts' to distinguish the topic from that
of State responsibility. A lawful act in turn would have to
be defined if it is used as a factor in this equation. Under
international law, not all acts are positively authorized for
them to be lawful." It is felt therefore safer or more ac-
ceptable for most to refer to 'acts not prohibited by inter-
national law' to distinguish the topic of international li-
ability from that of the study of the responsibility of States
for internationally wrongful acts. This was however not
considered helpful in distinguishing the nature of the topic
of liability from that of State responsibility. Brownlie, for
example, argued that very few acts were in fact prohibited
by international law, and that the focus of the international
liability topic, like the topic of the State responsibility for
wrongful acts, should not be on the acts themselves but
on the wrongful consequences of the acts. 12 In that sense,
there cannot be any real distinction between the topic of
State responsibility and international liability, particularly
if the focus is on State liability.
On the other hand, there were those who defended the
long title of the topic and the reference in particular to the
words 'acts not prohibited by international law' as impor-
tant. They argued that the focus of the topic was essen-
225
tially on the wrongful consequences of acts but this did
not mean that the acts themselves must be treated as wrong-
ful and requiring to be stopped or prohibited because of
such consequences.13
Second, on the scope of the topic, initially a wide vari-
ety of 'activities and situations' 14 were conceived by
Quentin Quentin-Baxter, the first Special Rapporteur.s
However, in 1996, the Commission was able to settle on
the scope of the topic as a working arrangement without
the need for a list of activities to be specified. The limita-
tion on the scope of the topic was instead constructed in
terms of certain criteria that had been agreed upon. It was
agreed that the focus should first be on activities that carry
a risk of causing transboundary harm. Second, for this
purpose, transboundary harm would refer to risk of harm
likely to be caused in the territory or within places under
the jurisdiction or control of a State because of activities
situated in the territory or within the jurisdiction or con-
trol of another State. Third, such harm must be able to be
related to the 'physical consequences' of such activities
or must be determinable by clear direct causal connection
between the activity and the harm.
Such delimitation would exclude, for example, from
the scope of the topic harm to global commons, that is
areas beyond the national jurisdiction of any State. Dam-
age to the environment per se not within national jurisdic-
tion, or air pollution and creeping pollution not attribut-
able to any one source are also excluded. In addition, eco-
nomic consequences arising from policies and decisions
of one State over another will also not fall within the scope.
This orientation on the scope of the topic has guided the
work of the Commission since then both on the topic of
prevention until 2001 and on liability since then.
The New Focus: Allocation of Loss instead
of International Liability
The draft principles adopted on 5 August 2004 are the
result of an important change in the orientation of the
Commission on the topic of international liability. Until
1996, the focus had been on the development of princi-
ples of international liability and on State liability com-
plementing operators' liability. But the present emphasis
of the principles is on allocation of loss among different
actors involved in the conduct of hazardous activities,
while stressing the obligation of the State to ensure pay-
ment of prompt and adequate compensation to victims of
transboundary harm. The factors that lead to this change
in focus may need some explanation. We will return to
these below, but first it may be opportune to note that the
Commission had less difficulty in agreeing to deal with
only 'significant' transboundary damage. This is with a
view to maintaining the same scope and threshold for trig-
gering the articles, as has been agreed to for the legal re-
gime on prevention. 6 It may be recalled that the Commis-
sion clarified in its commentary to the draft articles on
prevention that it means something that is not de minimus
or not negligible but which is more than 'detectable' and
'appreciable', without being at the level of 'serious' or
'substantial'."
However, several issues proved more difficult to re-
0378-777X/04/$17.00 @ 2004 lOS Press
226 ENVIRONMENTAL POLICY AND
solve, and to find a way out the Commission changed its
fundamental orientation on the topic of liability and now
emphasized the guiding principles on allocation of loss.
For some time, the Commission considered the idea of
imposing strict liability on the State in whose territory the
hazardous activity was situated, instead of channelling the
same to the private operators in charge of the activity. There
are some good reasons for favouring this policy; for ex-
ample, it would be easier to arrange expeditious and equi-
table compensation to victims of transboundary damage.
Reversing the burden of proof and placing the same on
the respondent, that is, the person in charge of the hazard-
ous operations, is another. Otherwise, it would be very
difficult for the transboundary victims to prove failure of
due diligence or fault to the required degree as per the law
of the land. In addition, it would facilitate processing of
claims without having to seek remedies in foreign juris-
dictions, which are subject to the policy of the forum State
and applicable law.
It is feared, on the other hand, that in the absence of
established, scientifically substantiated international stand-
ards for the determination of adverse transboundary ef-
fects in various spheres, the State liability approach would
amount to absolute liability for non-prohibited activities.
An undue emphasis on strict or absolute liability at the
international level appeared inappropriate while States in
practice adopted a more pragmatic approach to compen-
sation, without relying upon any one consistent concept
of liability. For these and other reasons, it has been pointed
out that States have consistently shown their reluctance to
accept liability for the actions of private parties.
Attributability of responsibility to States of wrongful
conduct of private citizens or operators, in the absence of
involvement of State officials or agents, is not normally
provided for in international law. Trail Smelter arbitra-
tion offered an example of a State, in this case Canada,
accepting responsibility for the wrongful emission of gases
from a private smelter which escaped into the neighbour-
ing territory of the USA. But that remains an exception. It
was a voluntary act on the part of Canada. It was felt there-
fore that any emphasis on State liability would be mis-
placed.
Many developing countries would also not be in a po-
sition to pay prompt and equitable compensation to trans-
boundary victims for damage caused by private operators.
This would be ironic, it is argued, if these operators were
multinational corporations, with better financial standing
than the developing country concerned. Moreover, it is
the operator who would be the primary beneficiary of any
financial gains of the operation. Hence it is suggested that
it is logical for the operator to take the first charge on any
loss arising from the operation as well.
It is also argued that the subject of international liabil-
ity is best dealt with at the bilateral or regional or sectoral
level, and is not suitable for a comprehensive regulation
at the global level. This is opposed to abandoning the
mandate given to the Commission and that it is under a
duty to complete the remainder of the work concerning
liability. In this connection the decision of the Commis-
sion to deal first with prevention and later to deal with
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LAW, 34/6 (2004)
international liability is once again recalled. Equally re-
called was the decision of the UNGA to seek completion
of the work on liability, when it noted with satisfaction
the completion of the work on prevention. In the light of
this, a Working Group of the Commission considered
afresh the whole question at its 2002 session and recom-
mended a new policy framework, which stressed the de-
velopment of guiding principles on the allocation of loss
for transboundary damage, instead of a strict regime of
liability.
Recommendations of the 2002 Working
Group of the ILC
The Working Group (2002) recommended that the
Commission should:
(a) concentrate on harm caused for a variety of reasons
but not involving State responsibility;
(b) better deal with the topic as allocation of loss among
different actors involved in the operations of the haz-
ardous activities than in the format of liability;
(c) cover within the scope of the topic loss to persons,
property, including the elements of State patrimony
and natural heritage, and the environment within na-
tional jurisdiction; and
(d) adopt the same focus and scope as the draft articles on
prevention for the remainder of the work.
The Commission endorsed these recommendations
and appointed the Special Rapporteur.
The significance of the framework suggested by the
2002 Working Group of the ILC is that it attempted to
open a new approach that would not have to rely exclu-
sively on any one concept of liability, much less on State
liability. It is also helpful in settling many of the unre-
solved issues concerning the nature of activities that the
criteria for delimiting 'transboundary damage' and thresh-
old of damage be brought within the scope of the topic.
At the policy level, there is general support for the
proposition that any regime of liability and compensation
should aim at ensuring that the innocent victim is not, as
far as possible, left to bear the loss resulting from trans-
boundary harm arising from hazardous activity. It is how-
ever acknowledged that full and complete compensation
may not be possible in every case. Problems with the defi-
nition of damage, difficulties concerning proof of loss,
and problems relating to the applicable law, as well as
limitations imposed on the operator's liability as well as
limitations within which contributory and supplementary
funding mechanisms operate often prevent the possibility
of obtaining such full and complete compensation. At the
same time, there is agreement that any regime for alloca-
tion of loss should be designed to provide incentives for
those concerned with hazardous operations to take pre-
ventive or protective measures in order to avoid damage.
Second, it should facilitate expeditious dispensation of
equitable compensation to victims of transboundary dam-
age through inexpensive claim resolution procedures.
Third, it should make the polluter pay as far as possible
and thus promote an economic function through the con-
cept of internalization of costs.
ENVIRONMENTAL POLICY AND LAW, 34/6 (2004)
Emergence of an Outline of a Regime of
International Liability
On the basis of a report (2003) submitted by the present
Special Rappaorteur, which examined several models of
allocation of loss" in cases of transboundary damage, there
was agreement within the Commission on a number of
points.
The various models of allocation of loss or liability
and compensation schemes make one point very clear.
They demonstrate that States have a duty to ensure that
some arrangement exists to guarantee equitable allocation
of loss. It does not follow that in every case this duty is
best discharged by negotiating a liability convention, still
less one based on any particular set of elements. It could
equally well be discharged, if it is considered appropriate,
as in EC law, by allowing forum shopping and letting the
plaintiff sue in the most favourable jurisdiction, or by ne-
gotiating an ad hoc settlement, as in the Bhopal litigation.
While the schemes do show common elements, they also
show that each scheme is tailor-made for its own context.
On the matter of civil liability of an operator, the first
report concluded that the legal issues involved are com-
plex and could be resolved on a case by case basis. That
resolution would also depend upon the jurisdiction in
which the case is taken up and the applicable law. Any
attempt at crafting a global regime would then have to
make a variety of choices, which inevitably would end up
as an exercise in harmonization. But such an exercise, if
considered desirable, would properly belong to forums
concerned with harmonization and progressive develop-
ment of private international law. The Commission was
persuaded that it is desirable to fashion, at the global level,
a general and residuary regime of liability to give States
sufficient flexibility to develop schemes of liability to suit
their special needs and particular circumstances.
The Issue of Damage to Global Commons
Some questions still remained on the treatment to be
accorded to damage to global commons per se. There was
general agreement that it was an important subject and
one that required prevention and suitable regulation with
a view to ensure remedial action in case of harm. The
matter was thoroughly discussed within the Commission
at its last session (2004). The Commission also took note
of the fact that the matter was studied at different times in
the past and each time the conclusion was reached that it
required a separate treatment. It was also understood that
the sources of pollution, the techniques of evaluating the
damage, the standing to present claims and identification
of the respondent liable were not easy and did not fall
squarely into the framework of the topic of international
liability.
The matter of providing suitable reimbursement for
the costs incurred for clean-up (or restoring the environ-
ment, or response measures taken to prevent damage to
the environment or natural resources per se within the
national jurisdiction of a State) is another issue, however.
Reference to damage to the environment or natural re-
sources, which are in the domain of public property and
cultural heritage, as part of the definition of damage is
227
widely recommended. The 2002 Working Group of the
Commission agreed that loss to persons, property (includ-
ing elements of State patrimony and natural heritage) and
the environment within national jurisdiction should be
covered. 19
The Draft Principles: Prompt and Adequate
Compensation as the Main Focus
The Draft Principles on International Liability should
be seen in the context of the relevant provisions of the Rio
Declaration on Environment and Development but more
specifically in the context of the Draft articles on the Pre-
vention of Transboundary Harm from Hazardous Activi-
ties. They are based on the assumption that transboundary
damage could occur in spite of the best efforts of the State
of origin to fully comply with all its due diligence obliga-
tions. They stress that those who suffer harm or loss as a
result should not be left to carry those losses and should
be able to obtain prompt and adequate compensation.
These principles establish the means by which this may
be accomplished. Draft principles 4 and 6 are particularly
noteworthy. The value of necessary arrangements for com-
pensation, which may be provided under international
agreements covering specific hazardous activities, is high-
lighted. Draft principle 7 encourages the development of
such agreements at the international, regional or bilateral
level, as appropriate. The principles are therefore intended
to contribute to the further development of international
law in this field.
The commentaries provide some guidance to States in
respect of hazardous activities, not covered by specific
agreements, by indicating the matters that should be dealt
with in future agreements. The approach adopted here is
consistent with the initial emphasis of Quentin-Baxter in
his schematic outline, which suggested a negotiated re-
gime of international liability on the basis of 'shared ex-
pectations' with 'boundless choices' for States. A work-
ing group of the Commission in 1996 also endorsed this
approach when it elaborated, under the direction of
Barboza, a scheme of negotiated reparation or compensa-
tion. Several factors were indicated at that time to facili-
tate such a negotiated settlement. These are noted in Arti-
cle 22 of the 1996 Report of the Workings of the Interna-
tional Law Commission. The possibility of claiming com-
pensation by resorting to court action was, however, not
ruled out. Article 20 of the 1996 draft was instructive on
this point. Claiming compensation on the basis of the le-
gal principle of strict liability, endorsed in many national
jurisdictions, was also kept as an option if compensation
either could not be negotiated among the States concerned
or if a negotiated settlement is not satisfactory to the
victim(s).
The general principles adopted reflect the basic un-
derstanding to adopt a scheme of allocation of loss, spread-
ing the loss among multiple actors, including the State.
Further, to keep the regime adopted general and residual
in character, the shares of different actors are not prede-
termined and the role to be assigned to the State is not
precisely identified. It is emphasized at the same time that
the State has, under international law, duties of preven-
0378-777X/04/$17.00 @ 2004 lOS Press
228 ENVIRONMENTAL POLICY AND
tion and these entail certain minimum standards of due
diligence.20 States are obliged in accordance with such du-
ties to allow hazardous activities with a risk of significant
transboundary harm, as noted above, only upon prior au-
thorization, utilizing environmental and transboundary
impact assessments, as appropriate, to exercise strict moni-
toring of the activity.
The attachment of primary and preferably strict liabil-
ity as suggested in principle 4 on the operator, in other
words, does not in any way absolve the State from dis-
charging its own duties of prevention under international
law. The preamble to the draft principles makes the point
that States are responsible under international law for com-
plying with their prevention obligations. The principles
are therefore without prejudice to the rules relating to State
responsibility and any other claim that may lie under those
rules in the event of a breach of the obligations of preven-
tion.
Definition of Damage: A Necessary Basis
for Claims of Compensation
There is broad agreement on the basic elements to be
incorporated in the definition of damage governing the
scheme of allocation of loss in cases of damage arising
from hazardous activities. This is stated in draft principle
2. The definition of damage suggested in principle 2, para-
graph (a) as read with the definition of environment in
principle 2, paragraph (b), goes beyond the definition
employed in most cases, which is generally confined to
damage to persons and property. 21 It may also be noted
that the reference to reasonable costs of 'reinstatement' in
principle 2 (a) (iv), and reasonable costs of response meas-
ures in principle 2 (a) (v) may also be seen as the accept-
ance of a new trend in the development of law. In com-
parison to the civil liability conventions covering oil pol-
lution, they indicate that 'there is a shift towards a greater
focus on damage to the environment per se rather than
22
primarily on damage to persons and to property'. Simi-
lar provisions were incorporated in the 1989 Basel Proto-
col on Liability and Compensation for Damage resulting
from Transboundary Movements of Hazardous Wastes and
their Disposal.
Response or restoration measures may be regarded as
reasonable if authorized by the State or provided for un-
der its laws or regulations or adjudged as such by a court
of law. Costs could be regarded as reasonable if they are
proportional to the results achieved or achievable in the
light of available scientific knowledge and technological
means. Further, recent treaty practice has tended to ac-
knowledge the importance of such measures, but has left
it to domestic law to indicate who may be entitled to take
such measures. Such measures have been described as any
reasonable measures aiming to assess, reinstate or restore
damaged or destroyed components of the environment or
where this is not possible, to introduce, where appropri-
ate, the equivalent of these components into the environ-
23
ment.
The invocation of the principle of 'equivalence', when
restoration of the damaged or destroyed environment is
not possible, is a further progressive step in the direction
0378-777X/04/$17.00 @ 2004 lOS Press
LAW, 34/6 (2004)
of environmental protection. This element is not reflected
in the Basel Protocol, but found its place in the US Oil
Pollution Act, 1990,24 1997 Protocol to amend the Vienna
Convention on Civil Liability for Nuclear Damage, 25 the
1993 Lugano Convention, the 2003 Kiev Protocol on Civil
Liability and Compensation for Damage caused by the
Transboundary Effects of Industrial Accidents on Trans-
boundary Waters 26 and the EU Common Position on a
proposed Directive on Liability of 18 September 2003.27
International and Domestic Remedies
With respect to providing specific remedies, several
procedures may be envisaged. For example, States could
in cases of transboundary damage negotiate and agree on
the amount of compensation payable. 28 These may include
mixed claims commissions, negotiations for lump sum
payments, etc. The international component does not pre-
clude possibilities whereby a State of origin may make a
contribution to the State affected to disburse compensa-
tion through a national claims procedure established by
the affected State. Such negotiations need not, unless oth-
erwise desired, bar negotiations between the State of ori-
gin and the private injured parties and such parties and the
person responsible for the activity causing significant dam-
age. Lump sum compensation could be agreed either as a
result of a trial or an out of court settlement. 2 9 Victims
could immediately be given reasonable compensation on
a provisional basis, pending a decision on the admissibil-
ity of claim and the actual extent of payable compensa-
tion. National claims commissions or joint claims com-
missions established for this purpose could examine the
claims and settle the final compensation payments.30 The
United Nations Compensation Commission3 1 and the US-
Iran Claims Commission3 2 may be useful models for some
of the procedures envisaged under paragraph 2 of princi-
ple 6.
The Commission is aware of the heavy costs involved
in pursuing claims on an international plane. It is also aware
of how long it could take to resolve some international
claims. Principle 6 (2) reflects the desire not to overbur-
den the victim with a lengthy procedure akin to a judicial
trial or procedures, which may act as a disincentive. It is
understood that it is the right of the individual to pursue
other remedies under domestic law.
Further, principle 6 (3) stresses the importance of ef-
fective domestic remedies, and this may require remov-
ing hurdles in order to ensure participation in administra-
tive hearings and proceedings. It also deals with two as-
pects of the equal right of access. It emphasizes the im-
portance of non-discriminatory standards for determina-
tion of claims concerning hazardous activities; and, sec-
ond, it deals with equal access to information. The refer-
ence to 'appropriate' access is intended to indicate that in
certain circumstances access to information or disclosure
of information may be denied. It is, however, important
that even in such circumstances information is readily
available concerning the applicable exceptions, the
grounds for refusal, procedures for review, and the charges
applicable, if any. Where feasible, such information should
be accessible free of charge or at a minimal expense.
ENVIRONMENTAL POLICY AND LAW, 34/6 (2004)
The access to national procedures and remedies to be
made available in the case of transboundary damage should
be equal to those that a State provides under national law
to its own nationals. It may be recalled that Article 16 of
the draft articles on prevention provides for a similar obli-
gation for States in respect of the phase of prevention dur-
ing which they are required to manage the risk with all
due diligence. A similar provision covering the phase
where injury actually occurred, despite all best efforts to
prevent damage, can be found in Article 32 of the 1997
Convention on the Law of the Non-Navigational Uses of
International Watercourses.
It is understood that in most cases the substantive or
applicable law to resolve compensation claims may in-
volve either civil liability or criminal liability or both, and
depends on a number of variables. Principles of civil law
or common law or private international law governing
choice of forums as well as applicable law may come into
focus depending upon the context and the jurisdiction in-
volved. Accordingly, the proposed scheme is not only
general and residuary but is also flexible without any preju-
dice to the claims that might arise and the applicable law
and procedures.
Historical map of the Amazon delta from Meyers encyclopadia (1888)
The Question of Final Form of the Draft
Principles
Finally, on the form of instrument, different views have
been advanced. On the one hand, it has been suggested
that they should be cast as draft articles and thereby be a
counterpart in form as well as substance to the draft arti-
cles on prevention. On the other hand, it has been pointed
out that as they are inevitably general and residuary in
character, they are more appropriately cast as principles.
The different characteristics of particular hazardous ac-
229
tivities may require the adoption of different approaches
with regard to specific arrangements. In addition, the
choices or approaches adopted may vary under different
legal systems. Further, such choices and approaches and
their implementation may also be influenced by different
stages of economic development of the countries con-
cerned.
On balance, the Commission concluded that recom-
mended principles would have the advantage of not re-
quiring a potentially unachievable harmonization of na-
tional laws and legal systems. It is also of the view that
the goal of widespread acceptance of the substantive pro-
visions is more likely to be met if they are cast as recom-
mended principles. But, as noted in the footnote to the
title, the Commission has reserved the right to reconsider
the matter of the final form of the instrument at the second
reading in the light of comments and observations made
by governments.
Assessment
At present, there is little clarity at the international level
on the material interests that merit compensation and on
the assessment and valuation of the damage involved. This
is true in the case of environmental damage, as
well as in the case of reparation for material dam-
age in general international law. ILC draft arti-
cles on State responsibility posit the principle of
reparation for every wrongful act, but without
adopting the same to any particular activity or
area. It is recognized that consequences for a
breach of an obligation are dependent upon the
substance of the concerned primary rule.3 3
Against this background, the draft principles on
allocation of loss attempted to adopt the general
law of liability to the particular context of sig-
nificant transboundary harm arising from hazard-
ous activities. In the process it defined 'damage'
in sufficiently broad terms to include not only
damage to persons and property but also damage
to the environment per se, natural resources, land-
scape and cultural heritage. The draft principles
adopted by the ILC leave a lot of flexibility to
States in fashioning regimes of liability to suit
the particular characteristics of each hazardous
activity and their special needs and circum-
stances, but they have attempted to take the law
of liability for environmental harm to a different
level from its present position in general interna-
tional law.
Second, by providing for reimbursement of reasonable
costs incurred by way of response or restitution measures
actually undertaken in connection with the transboundary
harm, the draft principles have added the necessary clar-
ity and specificity to the regime of liability governing en-
vironmental harm. Equally important is the specification
of the principle of equivalence, in case the environment
damaged cannot be restored to the condition existing prior
to the damage. These principles stated in the commentary
may be regarded as a further contribution to the evolving
law of liability for environmental harm and are the result
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230 ENVIRONMENTAL POLICY AND
of application of the general principles of responsibility
or liability to the concrete situation of transboundary dam-
age.
Notes:
1 E. Margolis, 'The Hydrogen Bomb Experiments and International law', 64
Yale Law Journal 629 (1955). Cited in Philippe Sands, PrinciplesofEnvironmen-
tal Law, second edition, 2003, p. 887.
2 M. McDougal and N. Schlei, 'The Hydrogen Bomb Tests in Perspective:
Lawful Measures for Security', 64 Yale Law Journal 648 (1955).
3 Philippe Sands, supranote 1, 885-886.
4 Patricia Birie and Alan Boyle, InternationalLaw & the Environment, sec-
ond edition, 2002, p. 115.
5 Philippe Sands, note 1, p. 232.
6 For the text and commentaries of the draft principles on international liability
in case of loss from transboundary harm arising out of hazardous activities, see
Report of the International Law Commission, UNGA, Official Records, Fifty-ninth
(2004) session, A/59/10, Ch. VII, paras 158-176.
7 It may be recalled that draft article 3 imposed on the State the obligation of
due diligence. One of the consequences of the obligation is that State can no longer
permit the conduct of a hazardous activity within its territory or in areas under its
jurisdiction without its prior authorization. The requirement of prior authorization
is in turn linked to a number of other obligations, which gained currency in the
context of the evolving global standards aimed at the prevention of harm to envi-
ronment. For example any application for prior authorization should contain an
environmental impact assessment along with an assessment of transboundary im-
pact of the activity in question. Any decision on the application should take into
consideration the principles of precaution and 'polluter pays'. In other words, as
far as possible any risk of irreversible damage should be avoided, even if there is
no scientific certainty about such damage. Further the costs of harm or pollution
should be internalized in the costs of the operation of the hazardous activity. Fur-
ther, the State is also obliged to undertake the broad management of significant
risk of transboundary necessary monitoring. As part of good governance the State
authorities also are required to promote a positive and productive engagement of
different sections of the society in the management of the risk. More importantly,
the draft articles on prevention specified the obligation to notify States concerned
and provide them with the right of consultation. However, the prevention regime
does not provide for any veto in favour of States likely to be affected or concerned
with respect of the projects on which they are given the right of consultation. Fail-
ure of due diligence obligations and obligations of notification and consultation by
the State of origin would engage State responsibility. For the LC draft articles and
commentary, see the Report of the International Law Commission, UNGA, Offi-
cial Records, Fifty-sixth (2001) session, A/56/10, Ch. V, paras 78-98.
8 Official Records of the GeneralAssembly, Thirty-second Session, Supple-
ment No 10 (A/32/10), para. 17.
9 Second Report on State Responsibility, Yearbook ILC, 1970, vol. II, p. 178,
document A/CN.4/SER.A/1970/Add.1 para. 6.
10 Prior to that the United Nations General Assembly noted in 1973 the desir-
ability of studying the injurious consequences of acts not treated as wrongful. This
aspect came to light because of the decision of the Commission in 1970 to confine
the study of the topic of State responsibility generated by a breach of an intema-
tional obligation, and thus to the origin and consequence of the wrongful conduct
of States.
11 In the Lotus case (1927), the Permanent Court of International of Justice stated
that restrictions on the freedom of States to act could not easily be presumed. Hence
it is argued in some cases that what is not positively prohibited is permitted and
hence lawful. This argument is not universally shared and today is rejected as
anachronistic. Strict positivism and the centrality of State consent for international
obligations is no longer viewed as correct reflection of the evolution and operation
of law in the modern world. Contemporary world is marked by interdependence
and globalization. Further, community interests are as dominant today as the bilat-
eral and reciprocal relationships and the ensuing interests they seek to protect. For
a discussion of some of these issues see Alain Pellet, 'The Normative Dilemma:
Will and Consent in International Law-Making', The Australian Yearbook of In-
ternationalLaw, Vol. 12(1992), pp. 22-53.
12 Ian Brownlie, System of the Law of Nations: State Responsibility, Part I(1983),
p. 50.
13 Daniel B. Magraw, 'Transboundary Harm: The International Law Commis-
sion's Study of International Liability', 80 A. J. I. L 305-330 (1986).
14 'Situations' are defined as 'a state of affairs, within the territory or control of
the source State, which does or may give rise to physical consequences with trans-
boundary effects', and examples given are an approaching oil slick, danger from
floods, or drifting ice, or risks arising from an outbreak of fire, pests or disease.
Fifth Report, Yearbook... 1984, Vol. II (Part One), p. 155, document A/CN.4/383
and Add.1 , at p. 166 and para. 31.
15 The following were mentioned: 'Use and regulation of rivers crossing or form-
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LAW, 34/6 (2004)
ing an international boundary and avoidance of damage from floods and ice; use of
land in frontier areas; spread, across national boundaries, of fire or any explosive
force, or of human, animal or plant disease; activities which may give rise to trans-
boundary pollution of fresh water, of coastal waters or of national airspace, or to
pollution of the shared human environment, including the oceans and outer space;
development and use of nuclear energy, including the operation of nuclear instal-
lations and nuclear ships and the carriage of nuclear materials; weather modifica-
tion activities; overflight of aircraft and space objects involving a risk of accidental
damage on the surface of the earth in airspace or in outer space; and activities
physically affecting common areas or natural resources in which other States have
rights or interests'. Fourth Report, Yearbook ILC, 1983, Vol. II (Par One), p. 201,
document A/CN.4/373 at p. 202 (footnote 8).
16 In the context of the draft articles on non-navigational uses of international
watercourses, the Commission considered several different types of thresholds for
triggering the obligations involved. In this connection 'appreciable', 'serious' or
'significant' harm or damage were considered as possible options for a threshold.
While in fact none of them would by themselves yield any particular understand-
ing as to what is permitted or not, it is the general feeling that 'significant' harm or
damage is in between the other two thresholds suggested.
17 See para (4) of the Commentary to Article 2 of the draft articles on Prevention
of Transboundary Harm from Hazardous Activities, Report of the International
Law Commission, 53rd Session, UNGA, Official Records, 56 Session, Suppl. No.
10, A/56/10, p. 388.
18 Relevant provisions of the liability conventions concluded in the field of oil
pollution, nuclear damage, environment, transboundary movement of hazardous
wastes, exploration and exploitation of seabed minerals, regulations concerning
the prospecting and exploration of polymetallic nodules in the international seabed
area, evolving trends in negotiations on a liability regime governing activities in
and around Antarctica were examined. It also touched upon the issues that arise in
the operation of civil liability of the operator, including conflict of laws. The First
Report concludes with a number of submissions on the basis of models surveyed:
(a) State liability is not generally favoured except in the case of outer space activi-
ties; (b) in the case of significant damage liability is channelled through a single
entity; and in the case of stationary operations, to the operator of the installation.
However, other possibilities exist; (c) the liability of the person in control of the
activity is strict but limited in the case of hazardous or dangerous activities; (d)
most liability regimes concerning dangerous activities provide for additional or
supplementary sources of funding created by contributions either from operators
of the same type of dangerous activities or from entities for whose direct benefit
the dangerous or hazardous activity is carried out; (e) strict liability has been rec-
ognized in several jurisdictions in all the legal systems around the world, and hence,
arguably it is a general principle of international law or, in any case, could be
considered as a measure of progressive development of intemational law; (f) fault-
based liability is not unlikely to better serve the interests of the innocent victims
and it is been retained as an option for liability.
See Pemmaraju Sreenivasa Rao, First Report on the legal regime for allocation of
loss in case of transboundary harm arising out of hazardous activities, Fifty-fifth
session of the International law commission, UN Doc. A/CN.4/531, 21 March 2003.
19 Official Records of the GeneralAssembly, Fifty-seventh session, Supplement
10 (A/57/10), para. 448.
20 Birnie and Boyle have observed, in respect of the draft article on prevention,
that '... there is ample authority in treaties and case law, and state practice for
regarding ... provisions of the Commission's draft convention as codification of
existing international law. They represent the minimum standard required of states
when managing transboundary risks and giving effect to Principle 2 of the Rio
Declaration', Patricia Birnie and Alan Boyle, supra note 4, p. 113.
21 For a concise discussion of the differing approaches on the definition of envi-
ronmental damage, see Philippe Sands, supra note 1, pp. 876-878.
22 Louise de la Fayatte, 'The Concept of Environmental Damage in Interna-
tional Law', in Michael Bowman and Alan Boyle, Environmental Damage in In-
ternationaland Comparative Law: Problems of Definition and Valuation (Oxford,
2002), pp. 149-190.
23 See, for example, the 1997 Protocol to Amend the 1963 Vienna Convention
on Civil Liability for Nuclear Damage, Article I, paragraph I (k) (iv): 'the costs of
measures of reinstatement of impaired environment, unless such impairment is
insignificant, if such measures are actually taken or to be taken, and insofar as not
included in sub-paragraph (ii)'; the annex to the 1997 Convention on Supplemen-
tary Compensation for Nuclear Damage, Article 1 (v) 'loss of income deriving
from an economic interest in any use or enjoyment of the environment, incurred as
a result of a significant impairment of that environment, and insofar as not in-
cluded in sub-paragraph (ii)'; the 2004 Paris Convention on Third Party Liability
(Article I (vii)(4): 'the costs of measures of reinstatement of impaired environ-
ment, unless such impairment is insignificant, if such measures are actually taken
or to be taken, and insofar as not included in sub-paragraph 2'. Article 1, para. 6 of
the 1992 of the International Convention on Civil Liability for Oil Pollution Dam-
age refers to impairment of the environment other than loss of profit from such
impairment shall be limited to costs of reinstatement actually undertaken or to be
undertaken. See also Article 2 (2) (c) (iv) and (d) of the Basel Protocol, Article 2
ENVIRONMENTAL POLICY AND LAW, 34/6 (2004)
(7) (c) and (8) of the Lugano Convention and Article 2 (2) (d) (iv) and (g) of the
Kiev Protocol.
24 Pub. L. No. 101-380, 104 Stat 480 or 33 U.S.C.A, sects. 2701 et seq.
25 36 ILM (1997), p. 1473.
26 See for a reference P. S. Rao, First Report, pp. 24, 32, 34, and Article 2(g) of
the Kiev Protocol, UNECE, Document MP.WAT/ 2003/1, CP.TEIA/2003/3 of 11
March 2003.
27 See the Common Position (EC) No. 58/2003 adopted by the Council on 18
September 2003, Official Journal of the European Union, C277 E/10 of 18 No-
vember 2003, p. 13, Article 2 (11).
28 In the case of damage caused to the fishermen, nationals of Japan due to
nuclear tests conducted by the US in 1954 near the Marshall Islands, the latter paid
to Japan US$2 million. See E. Margolis, supra note 1. For similar payment of C$3
million by way of compensation by the USSR to Canada following the crash of
Cosmos 954 in January 1978, see Philippe Sands, ibid, p. 887. The author also
noted that although several European States paid compensation to their nationals
for damage suffered due to the Chernobyl nuclear accident, they did not attempt to
make formal claims for compensation, even while they reserved their right to do
so; ibid, pp. 886-889. Mention may also be made of draft articles 21 and 22 adopted
by the Working Group of the Commission in 1996. Article 21 recommended that
the State of origin and the affected States should negotiate at the request of either
party on the nature and extent of compensation and other relief. Article 22 referred
to several factors that States may wish to consider for arriving at the most equitable
quantum of compensation. For the report of the Working Group of the Commis-
sion, 1996, see Official Records of the GeneralAssembly, Fifty-first session Sup-
plement 10 (A/51/10), pp. 320-327.
UNEP
From Stockholm to Nairobi
by Nicholas Kimani*
This articleprovides a historicalinsight into the United
Nations Environment Programme (UNEP), the pioneer-
ing United Nations agency headquarteredin the develop-
ing world. The first part considers the internationalde-
velopments that took place immediatelyprior to the Stock-
holm Conference, followed by an account of
the diplomaticandpoliticalactivitiesthat even-
tually led to the establishmentof UNEP and its
location in a developing country -Kenya. The
final section reviews the work of UNEP to date,
from the context of its historicalmandate.
Introduction
The historical United Nations Conference
on the Human Environment (Stockholm, 5-16
June 1972) is rightly considered as the "cocoon
from which the chrysalis of international envi- Maurice Str ong
ronmental law emerged as a legal subject in its
* Nicholas Kimani assisted by Elizabeth Mrema. He is a formerintern at UNEP,
and presently a lecturer of Law at United States International University-Nairobi
while Elizabeth Mrema is a Senior Legal Officer with the Division of Environ-
mental Policy Implementation in UNEP. However, the full account of what hap-
pened for Kenya to win the bid to host UNEP is the full credit of Mr Donald
Kaniaru, former Director of the Division of Environmental Policy Implementation
in UNEP until February 2003 who participated in those negotiations as the then
Government of Kenya delegate. Thanks also go to Ms Maria Mutua, also a former
intern at UNEP, for initial research work done on the preparation of this paper.
Views expressed in this paper are those of the authors and not necessarily of the
United Nations.
231
29 In connection with the Bhopal gas leak disaster, the government of India
attempted to consolidate the claims of the victims. It sought to seek compensa-
tion by approaching the US court first but on grounds of forum non-conven-
ience the matter was litigated before the Supreme Court of India. The Bhopal
Gas Leak Disaster (Processing of Claims) Act, 1985 provides the basis for the
consolidation of claims. The Supreme Court of India in the Union Carbide Cor-
porationv. Union of India and others, All India Reports 1990 SC 273 gave an
order settling the quantum of compensation to be paid in lump sum. It provided
for the Union Carbide to pay a lump sum of $470 million to the Union of India
in full settlement of all claims, rights and liabilities related to and arising out of
the Bhopal gas disaster. The original claim of the Indian Government was over
$1 billion.
30 For the April 2002 award of $324,949,311 to the people of Enewatak in re-
spect of damage to the land arising out of the nuclear programme carried out by the
US between 1946 and 1958.
31 On the procedure adopted by the UN Claims Commission, see Mojtaba Kazazi,
'Environmental Damage in the Practice of the UN Compensation Commission', in
Michael Bowman and Alan Boyle, supra note 22, pp. 111-113.
32 The Iran-United States Claims Tribunal came into existence as one of the
measures taken to resolve the crisis in relations between the Islamic Republic of
Iran and the US arising out of the detention of 52 US nationals at the US Embassy
in Teheran which commenced in November 1979, and the subsequent freeze of
Iranian assets by the US. For background information visit www.iusct.org.
33 See Alan Boyle, 'Reparation for Environmental Damage in International Law:
Some Preliminary Problems', in Michael Bowman and Alan Boyle, supra note 22,
pp. 17-26, especially p. 18.
own right". It was arguably the first time that sovereign
nations acknowledged a responsibility for domestic ac-
tions that affected the environments of other nations and
the planet as a whole. The Conference gave the impetus
towards the development of international environmental
law, and also led to the establishment of the
United Nations Environment Programme
(UNEP) in 1972 as the global environmental
voice. Consequently, this article reviews and
assesses the events between 1968, when the
Stockholm Conference was first proposed, and
1973 when UNEP was established in Nairobi,
Kenya. In assessing whether its presence in
the developing world has made any signifi-
cant difference to the developing countries, it
sheds light on the background to the Stock-
holm Conference, and the role that was played
Co urtesy: UNEP by developing countries in ensuring that
UNEP was located in a fellow developing
country, amid strong competition to situate it among the
rest of the United Nations organs and specialised agen-
cies in North America, New York, or in Western Europe.
Background to the Stockholm Conference
While humanity has exploited the earth's natural re-
sources for thousands of years, it was only in the twenti-
eth century that serious concerns began to be raised re-
garding the environmental impacts of human activities.
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