
From the U.S. Code Online via GPO Access
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[Laws in effect as of January 23, 2000]
[Document not affected by Public Laws enacted between
  January 23, 2000 and December 4, 2001]
[CITE: 42USC9608]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
  CHAPTER 103--COMPREHENSIVE ENVIRONMENTAL RESPONSE, COMPENSATION, AND 
                                LIABILITY
 
  SUBCHAPTER I--HAZARDOUS SUBSTANCES RELEASES, LIABILITY, COMPENSATION
 
Sec. 9608. Financial responsibility


(a) Establishment and maintenance by owner or operator of vessel; 
        amount; failure to obtain certification of compliance

    (1) The owner or operator of each vessel (except a nonself-propelled 
barge that does not carry hazardous substances as cargo) over three 
hundred gross tons that uses any port or place in the United States or 
the navigable waters or any offshore facility, shall establish and 
maintain, in accordance with regulations promulgated by the President, 
evidence of financial responsibility of $300 per gross ton (or for a 
vessel carrying hazardous substances as cargo, or $5,000,000, whichever 
is greater) to cover the liability prescribed under paragraph (1) of 
section 9607(a) of this title. Financial responsibility may be 
established by any one, or any combination, of the following: insurance, 
guarantee, surety bond, or qualification as a self-insurer. Any bond 
filed shall be issued by a bonding company authorized to do business in 
the United States. In cases where an owner or operator owns, operates, 
or charters more than one vessel subject to this subsection, evidence of 
financial responsibility need be established only to meet the maximum 
liability applicable to the largest of such vessels.
    (2) The Secretary of the Treasury shall withhold or revoke the 
clearance required by section 91 of title 46, Appendix, of any vessel 
subject to this subsection that does not have certification furnished by 
the President that the financial responsibility provisions of paragraph 
(1) of this subsection have been complied with.
    (3) The Secretary of Transportation, in accordance with regulations 
issued by him, shall (A) deny entry to any port or place in the United 
States or navigable waters to, and (B) detain at the port or place in 
the United States from which it is about to depart for any other port or 
place in the United States, any vessel subject to this subsection that, 
upon request, does not produce certification furnished by the President 
that the financial responsibility provisions of paragraph (1) of this 
subsection have been complied with.
    (4) In addition to the financial responsibility provisions of 
paragraph (1) of this subsection, the President shall require additional 
evidence of financial responsibility for incineration vessels in such 
amounts, and to cover such liabilities recognized by law, as the 
President deems appropriate, taking into account the potential risks 
posed by incineration and transport for incineration, and any other 
factors deemed relevant.

(b) Establishment and maintenance by owner or operator of production, 
        etc., facilities; amount; adjustment; consolidated form of 
        responsibility; coverage of motor carriers

    (1) Beginning not earlier than five years after December 11, 1980, 
the President shall promulgate requirements (for facilities in addition 
to those under subtitle C of the Solid Waste Disposal Act [42 U.S.C. 
6921 et seq.] and other Federal law) that classes of facilities 
establish and maintain evidence of financial responsibility consistent 
with the degree and duration of risk associated with the production, 
transportation, treatment, storage, or disposal of hazardous substances. 
Not later than three years after December 11, 1980, the President shall 
identify those classes for which requirements will be first developed 
and publish notice of such identification in the Federal Register. 
Priority in the development of such requirements shall be accorded to 
those classes of facilities, owners, and operators which the President 
determines present the highest level of risk of injury.
    (2) The level of financial responsibility shall be initially 
established, and, when necessary, adjusted to protect against the level 
of risk which the President in his discretion believes is appropriate 
based on the payment experience of the Fund, commercial insurers, courts 
settlements and judgments, and voluntary claims satisfaction. To the 
maximum extent practicable, the President shall cooperate with and seek 
the advice of the commercial insurance industry in developing financial 
responsibility requirements. Financial responsibility may be established 
by any one, or any combination, of the following: insurance, guarantee, 
surety bond, letter of credit, or qualification as a self-insurer. In 
promulgating requirements under this section, the President is 
authorized to specify policy or other contractual terms, conditions, or 
defenses which are necessary, or which are unacceptable, in establishing 
such evidence of financial responsibility in order to effectuate the 
purposes of this chapter.
    (3) Regulations promulgated under this subsection shall 
incrementally impose financial responsibility requirements as quickly as 
can reasonably be achieved but in no event more than 4 years after the 
date of promulgation. Where possible, the level of financial 
responsibility which the President believes appropriate as a final 
requirement shall be achieved through incremental, annual increases in 
the requirements.
    (4) Where a facility is owned or operated by more than one person, 
evidence of financial responsibility covering the facility may be 
established and maintained by one of the owners or operators, or, in 
consolidated form, by or on behalf of two or more owners or operators. 
When evidence of financial responsibility is established in a 
consolidated form, the proportional share of each participant shall be 
shown. The evidence shall be accompanied by a statement authorizing the 
applicant to act for and in behalf of each participant in submitting and 
maintaining the evidence of financial responsibility.
    (5) The requirements for evidence of financial responsibility for 
motor carriers covered by this chapter shall be determined under section 
31139 of title 49.

(c) Direct action

                      (1) Releases from vessels

        In the case of a release or threatened release from a vessel, 
    any claim authorized by section 9607 or 9611 of this title may be 
    asserted directly against any guarantor providing evidence of 
    financial responsibility for such vessel under subsection (a) of 
    this section. In defending such a claim, the guarantor may invoke 
    all rights and defenses which would be available to the owner or 
    operator under this subchapter. The guarantor may also invoke the 
    defense that the incident was caused by the willful misconduct of 
    the owner or operator, but the guarantor may not invoke any other 
    defense that the guarantor might have been entitled to invoke in a 
    proceeding brought by the owner or operator against him.

                    (2) Releases from facilities

        In the case of a release or threatened release from a facility, 
    any claim authorized by section 9607 or 9611 of this title may be 
    asserted directly against any guarantor providing evidence of 
    financial responsibility for such facility under subsection (b) of 
    this section, if the person liable under section 9607 of this title 
    is in bankruptcy, reorganization, or arrangement pursuant to the 
    Federal Bankruptcy Code, or if, with reasonable diligence, 
    jurisdiction in the Federal courts cannot be obtained over a person 
    liable under section 9607 of this title who is likely to be solvent 
    at the time of judgment. In the case of any action pursuant to this 
    paragraph, the guarantor shall be entitled to invoke all rights and 
    defenses which would have been available to the person liable under 
    section 9607 of this title if any action had been brought against 
    such person by the claimant and all rights and defenses which would 
    have been available to the guarantor if an action had been brought 
    against the guarantor by such person.

(d) Limitation of guarantor liability

                         (1) Total liability

        The total liability of any guarantor in a direct action suit 
    brought under this section shall be limited to the aggregate amount 
    of the monetary limits of the policy of insurance, guarantee, surety 
    bond, letter of credit, or similar instrument obtained from the 
    guarantor by the person subject to liability under section 9607 of 
    this title for the purpose of satisfying the requirement for 
    evidence of financial responsibility.

                         (2) Other liability

        Nothing in this subsection shall be construed to limit any other 
    State or Federal statutory, contractual, or common law liability of 
    a guarantor, including, but not limited to, the liability of such 
    guarantor for bad faith either in negotiating or in failing to 
    negotiate the settlement of any claim. Nothing in this subsection 
    shall be construed, interpreted, or applied to diminish the 
    liability of any person under section 9607 of this title or other 
    applicable law.

(Pub. L. 96-510, title I, Sec. 108, Dec. 11, 1980, 94 Stat. 2785; Pub. 
L. 99-499, title I, Secs. 108, 127(c), Oct. 17, 1986, 100 Stat. 1631, 
1692.)

                       References in Text

    The Solid Waste Disposal Act, referred to in subsec. (b)(1), is 
title II of Pub. L. 89-272, Oct. 20, 1965, 79 Stat. 997, as amended 
generally by Pub. L. 94-580, Sec. 2, Oct. 21, 1976, 90 Stat. 2795. 
Subtitle C of the Solid Waste Disposal Act is classified generally to 
subchapter III (Sec. 6921 et seq.) of chapter 82 of this title. For 
complete classification of this Act to the Code, see Short Title note 
set out under section 6901 of this title and Tables.
    The Federal Bankruptcy Code, referred to in subsec. (c)(2), probably 
means a reference to Title 11, Bankruptcy.

                          Codification

    In subsec. (b)(5), ``section 31139 of title 49'' substituted for 
``section 30 of the Motor Carrier Act of 1980, Public Law 96-296'' on 
authority of Pub. L. 103-272, Sec. 6(b), July 5, 1994, 108 Stat. 1378, 
the first section of which enacted subtitles II, III, and V to X of 
Title 49, Transportation.


                               Amendments

    1986--Subsec. (a)(1). Pub. L. 99-499, Sec. 127(c)(1), inserted ``to 
cover the liability prescribed under paragraph (1) of section 9607(a) of 
this title'' after ``whichever is greater)''.
    Subsec. (a)(4). Pub. L. 99-499, Sec. 127(c)(2), added par. (4).
    Subsec. (b)(2). Pub. L. 99-499, Sec. 108(a), inserted provisions 
relating to evidence of financial responsibility and authority of the 
President regarding establishment of that evidence.
    Subsec. (b)(3). Pub. L. 99-499, Sec. 108(b), substituted ``as 
quickly as can reasonably be achieved but in no event more than 4 
years'' for ``over a period of not less than three and no more than six 
years''.
    Subsec. (c). Pub. L. 99-499, Sec. 108(c), amended subsec. (c) 
generally. Prior to amendment, subsec. (c) read as follows: ``Any claim 
authorized by section 9607 or 9611 of this title may be asserted 
directly against any guarantor providing evidence of financial 
responsibility as required under this section. In defending such a 
claim, the guarantor may invoke all rights and defenses which would be 
available to the owner or operator under this subchapter. The guarantor 
may also invoke the defense that the incident was caused by the willful 
misconduct of the owner or operator, but such guarantor may not invoke 
any other defense that such guarantor might have been entitled to invoke 
in a proceeding brought by the owner or operator against him.''
    Subsec. (d). Pub. L. 99-499, Sec. 108(c), amended subsec. (d) 
generally. Prior to amendment, subsec. (d) read as follows: ``Any 
guarantor acting in good faith against which claims under this chapter 
are asserted as a guarantor shall be liable under section 9607 of this 
title or section 9612(c) of this title only up to the monetary limits of 
the policy of insurance or indemnity contract such guarantor has 
undertaken or of the guaranty of other evidence of financial 
responsibility furnished under this section, and only to the extent that 
liability is not excluded by restrictive endorsement: Provided, That 
this subsection shall not alter the liability of any person under 
section 9607 of this title.''

                  Section Referred to in Other Sections

    This section is referred to in section 9609 of this title.
