A major shipping company is doubling down on its refusal to pay $1 billion in damages after one of its vessels contaminated nearly 50 miles of Sri Lanka's western coast.

What's happening?

Marine Insight reported that Singapore's Supreme Court ordered X-Press Feeders — a Singapore-based independent common carrier — to pay $1 billion after the sinking of the MV X-Press Pearl in June 2021.

The sinking led to the country's worst environmental pollution disaster after a nitric acid leak sparked a fire. As the ship went down, it released hundreds of tons of plastic pellets into Sri Lankan waters, along with acid and other hazardous materials.    

However, X-Press Feeders CEO Shmuel Yoskovitz told AFP that his company would not comply with the ruling, which occurred this July, calling it a "hanging guillotine" over normal operations and maritime trade, according to Marine Insight. 

Why is this important?

Sri Lanka had to close beaches and ban fishing along its western coast for months, making it harder for fishers to stay financially afloat when they were already struggling due to COVID-19 mobility constraints, per the Centre for Poverty Analysis, an independent Sri Lankan think tank. 

The fire also released up to 14,330 tons of toxic air pollutants into the atmosphere, while the 331 tons of bunker oil spillage should have "lasting effects," even if beaches look clean. 

Elsewhere, oil disasters have led to continued biodiversity loss years later. First responders have also reported health complications they attribute to toxic exposure.

Yoskovitz said his company has already paid $170 million toward cleanup, wreck removal, and fisher compensation, according to Marine Insight. He said the company is open to paying more as part of a settlement under standard maritime conventions. However, the Sri Lankan government feels this isn't enough. 

What is Sri Lanka doing about this?

Government spokesman Nalinda Jayatissa said Sri Lanka is exploring its legal options, as the UN Convention on the Law of the Sea recognizes the "polluter pays" principle. 

The court has also given police and prosecutors the green light to commence criminal proceedings if X-Press Feeders continues to buck the $1 billion fine, per Marine Insight. The ship's captain has not been allowed to leave Sri Lanka since the incident four years ago.

Sri Lanka has also filed a complaint against X-Press Feeders in the Singapore International Commercial Court. However, a pre-trial hearing isn't expected until May 2026. First, Sri Lanka is challenging a London Admiralty Court order limiting X-Press Feeders' liability to $25 million.

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