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P&I Club intensifying approaches to the authorities in Sri Lanka over the compensation awarded to cover damages
The London P&I Club, acting as assurer to the owners of the 'X-Press Pearl', was intensifying its approaches to the authorities in Sri Lanka over the compensation awarded to cover damage caused by the shipwreck of the vessel in May 2021 As a precautionary measure, the Sri Lankan authorities had halted local fishing due to fears of acid contamination and also to allow salvage operations to continue safely. In July 2025, Sri Lanka's Supreme Court ruled in favour of local fishermen in a human rights claim. The finding criticised both X-Press Feeders for not sharing information and the government for not responding effectively enough. Without hearing expert evidence on the quantum, the court set the value of the loss at an arbitrary figure $1 billion, to be paid by the owner as the polluter, with further sums to be calculated by a committee. X-Press Feeders have financed the clean-up efforts made so far, covering fisheries and beach clean-up, as well as salvage, wreck and debris removal. But, along with the London P&I Club, they have declined to make further payments, asserting that jurisdiction for environmental damage in this case lies in Singapore. Further, they contended that the cost calculations in other areas were largely based on theoretical estimates of damage using unapproved methodologies, which diverged from recorded evidence on the ground. They have referenced impartial technical advice issued by the International Tanker Owners Pollution Federation (ITOPF), which recommends internationally-accepted methodologies for assessing Oil Spill Damage, Nitrogen Added to Ocean, Human Health Air Pollution Impacts, Turtle Damage, Impacts on Whales, Microplastic Related Damages - Fisheries, Microplastic and Chemical Related Damages - Fish Consumers and Beach Users, Fisher Livelihoods, Incurred Costs and Future Monitoring. The London P&I Club was now seeking the UK government's support to help with opening a dialogue with the Sri Lankan government, which was standing by its judiciary's findings. Neither the British nor the Sri Lankan government appears to be communicating with the other over the matter. The London P&I Club's position was that a negotiated settlement was in the best interests of the Sri Lankan government and the international maritime community. They were working with X-Press Feeders to achieve a rules-based outcome compliant with the norms of international trade.
X-Press Feeders refusing to pay a preliminary compensation
The shipping company X-Press Feeders and its insurance company are refusing to pay a preliminary compensation of $250 million, as demanded in a judgment issued by the Sri Lankan Supreme Court in July. The total compensation could amount to a billion dollars and perhaps much more. "While we respect the legal process, the judgment opens the possibility of further and potentially unlimited compensation. Any payment could set a dangerous precedent for how maritime incidents will be resolved in the future," said Shmuel Yoskovitz, CEO of X-Press Feeders. The 'X-Press Pearl' sank off Colombo in June 2021 after a fire broke out in a container with leaking nitric acid, triggering the worst pollution disaster ever in Sri Lanka. According to the shipping company, it has paid more than $170 million to date for the wreck removal, cleanup and compensation claims.
Operator challenged court ruling
X-Press Feeders as the former operator of the 'X-Press Pearl', has challenged the recent Sri Lankan Supreme Court ruling that ordered the company to pay an initial $1 billion in damages within one year related to the vessel’s casualty. The judgment, handed down in late July 2025, has been called by the London P&I Club “an extraordinary and deeply troubling turn of events” that potentially undermined fundamental principles of maritime law. At the heart of the dispute was the continued detention of the vessel’s master, who has been unable to leave Sri Lanka for 4,5 years due to a court-ordered travel ban. X-Press Feeders noted that despite offering to deposit the maximum possible fine for the charges he faced, he was still separated from his family and unable to resume his life or career.
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