The Finnish Oil Pollution Compensation Fund, managed by the Ministry of the Environment, is used to reimburse the costs of oil spills and oil spill response on land and at sea when the party that caused the accident is not known or the culpable party is unable to reimburse the costs.
The Finnish Oil Pollution Compensation Fund is a secondary source of compensation for oil spills and the costs of responding to them. The amounts paid as compensations from the fund are recovered from the party that caused the oil spill, or from another party with primary responsibility for it.
Restoration of oil-contaminated soil and groundwater
On a discretionary basis the Finnish Oil Pollution Compensation Fund can be used to compensate for the costs of restoring soil and groundwater contaminated with oil if the party that caused the contamination is not known, cannot be reached, or cannot pay for the costs caused by the contamination. A further condition is that it is not considered reasonable to oblige the party that owns the polluted area to clean it.
Earlier soil contamination has typically been caused by fuel distribution, repair activities or other oil processing and storage. According to an estimate by the Environmental Administration, there are still around 800 possibly oil-contaminated high-risk sites in Finland. The sites are listed in the National Database System for Soil.
New clean-up projects concerning oil-contaminated soil not eligible for compensation from Oil Pollution Compensation Fund
Compensations from the Finnish Oil Pollution Compensation Fund have been paid on a discretionary basis for costs arising from the clean-up of oil-contaminated soil or groundwater, investigating the need for such clean-up and planning the works to be done (Act on the Finnish Oil Pollution Compensation Fund 1406/2004, section 15). The accrued oil waste charges transferred from the Budget to the Fund have been used to pay the compensations. Oil waste charges have not been collected since 2019, which means that there are no appropriations to be transferred to the Fund. What this means in practice is that, when the funds of the appropriations already transferred to the Fund run out, compensations will no longer be granted for clean-up projects. Damages caused by acute oil spills will continue to be compensated for because they are funded through the oil damage duty.
Based on the funding situation described above, the Board of the Finnish Oil Pollution Compensation Fund decided on its new policy on 24 May 2021. The decision enters into force immediately. The investigation and restoration projects that have already been started will be completed. Instead, after 24 May 2021 funding will not be granted for new investigation and clean-up projects concerning oil-contaminated soil or groundwater. The costs of investigation or clean-up projects the applicant may already have implemented are also not eligible for compensation.
Subsidies for investigation and clean-up projects concerning soil or groundwater may be applied for from the ‘Maaperä kuntoon’ soil restoration project of the Centre for Economic Development, Transport and the Environment for Pirkanmaa.
The JASKA project is a fixed-term project initiated by the Ministry of the Environment and the Finnish Oil Pollution Compensation Fund with the goal of studying and restoring old oil-polluted sites in high-risk areas.
The Centre for Economic Development, Transport and the Environment for Pirkanmaa has been in charge of the arrangements for the project.
Compensations to regions, municipalities and the state from the Finnish Oil Pollution Compensation Fund
Regional rescue services are entitled to compensation from the fund for expenses due to the acquisition of oil response equipment, the maintenance of oil spill prevention response preparedness, and training. The Finnish Oil Pollution Compensation Fund usually reimburses 50 to 90 per cent of the acquisition costs of oil spill response vessels. Regional rescue services and municipalities may also be granted discretionary compensation for the acquisition costs of storage facilities for oil spill response equipment. The state may be granted discretionary compensation for the acquisition costs of equipment to respond to oil accidents caused by vessels and for the costs of maintaining response preparedness. In the case of the Åland Islands compensations may be paid for the acquisition costs of oil spill response equipment for accidents caused by vessels.
Compensation decisions by the board of the Finnish Oil Pollution Compensation Fund
The board of the Finnish Oil Pollution Compensation Fund, appointed by the Government for a three-year term, makes decisions concerning compensations paid from the fund. The board has a representative from the Ministry of the Interior, the Ministry of Finance, the Ministry of the Environment, a nature and environmental conservation organisation, the oil industry, and the Association of Finnish Local and Regional Authorities. The chair of the board is impartial and does not represent any party that has an interest in oil pollution matters.
Processing of personal data at the Finnish Oil Pollution Compensation Fund
The application documents addressed to the Finnish Oil Pollution Compensation Fund contain personal data. When processing such documents the Finnish Oil Pollution Compensation Fund acts as a controller as referred to in the General Data Protection Regulation of the European Union and complies with the principles and requirements laid down for the processing of personal data and for the controller in the said regulation. Further information concerning the processing of personal data in the Finnish Oil Pollution Compensation Fund can be found in the following document.
Income and expenditure of the Finnish Oil Pollution Compensation Fund
The Finnish Oil Pollution Compensation Fund is an off-budget entity. Its operations are funded through the oil protection fees and transfers from the Budget.
The oil protection fee is collected for oil which is either imported to Finland or transported through Finland. If oil is transported by a vessel whose cargo section is not completely double-hulled, a double oil protection fee is collected.
Part of the oil waste duty may be transferred from the Budget to the Finnish Oil Pollution Compensation Fund to be used to cover the costs of clean-up operations in old oil-polluted land areas. Each year an average of EUR 2–3 million of the oil waste duties have been transferred to the fund.
Use of the Finnish Oil Pollution Compensation Fund
The compensations paid annually from the Finnish Oil Pollution Compensation Fund total about EUR 10 million. This roughly corresponds to the oil protection fees collected annually and oil waste duties transferred from the Budget. The higher oil waste duty payable in 2010-2015 increased the income of the fund and the compensations paid from it.
International Oil Pollution Compensation Fund
Compensations for oil spills caused by oil tankers in the Finnish territorial waters are paid from the International Oil Pollution Compensation Fund (1992) and its Supplementary Fund if compensations cannot be collected from the party that caused the accident or where the damage exceeds the vessel owner’s limit of liability.al Oil Pollution Compensation Fund (1992) and its Supplementary Fund in cases where compensation cannot be recovered from the party responsible for the oil spill, or where the damage surpasses the liability limit of the vessel owner.