Mr. Chair, and committee members, thank you for having invited the Shipping Federation of Canada to testify before you this morning about part 4 of Bill C-3, the safeguarding Canada's seas and skies act.
The federation, incorporated by an Act of Parliament in 1903, is the representative in Canada of the owners, operators, and agents of ocean ships trading at ports across Canada from the Atlantic to the St. Lawrence and the Great Lakes to the west coast. The ships operated by our members carry Canada's imports and exports throughout the world. These ships are part of the world ocean fleet that sails around the clock, 365 days a year, from one country to another to deliver world trade.
These fleets are governed by a web of international conventions that cover the ship, its building and equipment, manning requirements, and operations, etc. These conventions are incorporated into Canadian law through the provisions and regulations flowing from the Canada Shipping Act, 2001. This world ocean fleet is also governed by a set of liability conventions. These liability conventions are incorporated into Canadian law through the Marine Liabilities Act, which will be amended by part 4 of Bill C-3, which we are here today to support.
These amendments to the Marine Liabilities Act do not come as a surprise to us as they are a step in a long process that started many years ago with the 1996 HNS convention, which did not gain much traction due to a number of implementation issues. Canada subsequently stepped in and provided leadership in the development of a protocol that solved these issues. The upgraded 2010 HNS convention therefore benefits from Canada's input.
The federation, along with industry and other stakeholders, has participated in the government's consultation and Canada's ratification of this upgraded 2010 HNS convention, and has expressed strong support for such ratification. We are not alone in that respect. The 2010 HNS convention has been targeted by the Comité Maritime International, which is the international association of maritime law national associations, and various international industry associations, as one of the priority conventions for worldwide ratification.
We support this international liability regime introduced by part 4 of Bill C-3 because we believe it is the most efficient way to offer efficient liability coverage for ship-source chemical spills. We believe so because for mobile assets that trade across the world on a continual basis, as ocean ships do, an international regime avoids the high transactional costs that would be attached to a fragmentation of national liability regimes, each of which would have its own rules, liability limits, paperwork, and so on. For us, the first element of an efficient regime is that it is an international regime.
Maybe of more interest to your side, the international regime contained in the 2010 HNS convention pools the risk and its financing among a large number of players, which minimizes the marginal cost of covering the risk for each of them. The international regime grants access to an international fund funded by HNS receivers at a higher limit of indemnification than shipowners alone could provide. Also, this regime is modelled on the ship-source oil pollution liability regime that has been in place and is functioning well.
For all these reasons, we respectfully submit to this committee that Parliament should pass the amendments to the Marine Liabilities Act that are contained in part 4 of Bill C-3, and it's why our organization sent a letter on January 23 to this committee to support the passing of this part of the bill.