Singapore shipping firm refuses to pay $1 billion Sri Lankan pollution fine, citing global trade risks AURORATOTO GROUP

SINGAPORE: In a bold move that could reshape the rules of global shipping, a major maritime company has announced it will not pay the $1 billion fine ordered by Sri Lanka’s highest court — a penalty stemming from one of the worst environmental disasters in the island nation’s history.

X-Press Feeders, the Singapore-based operator of the ill-fated MV X-Press Pearl, says the court’s decision threatens the foundation of international maritime law and could set a dangerous precedent for how shipping accidents are handled worldwide.

“This judgment undermines the core principle of limited liability in maritime law,” said CEO Shmuel Yoskovitz in an exclusive interview with AFP. “If we comply, we open the floodgates for every shipowner to be held endlessly liable.”

A catastrophe at sea — and ashore

In June 2021, the X-Press Pearl caught fire and sank just off Sri Lanka’s coastline near Colombo Port, after a leak of nitric acid sparked a blaze that burned for nearly two weeks.

Onboard were 81 containers of hazardous cargo — acids, heavy metals, and an estimated 87 tonnes of plastic pellets — which washed ashore along 80 kilometres of Sri Lanka’s western coast, killing marine life, crippling fisheries, and causing long-term environmental damage.

Fishing bans were imposed, livelihoods were devastated, and environmentalists called it “Sri Lanka’s worst marine disaster.”

“The plastic may no longer be visible, but the impact will last for decades,” warned Hemantha Withanage, director of Sri Lanka’s Centre for Environmental Justice.

The court ruling — and a refusal

In July 2025, Sri Lanka’s Supreme Court ordered X-Press Feeders to pay an initial $1 billion in damages, including $250 million due this week. The judgment also left the door open for additional payments after further environmental assessments.

But the company has refused to comply.

“We’re not walking away,” said Yoskovitz. “We’ve already spent $170 million on cleanup, removing the wreck, and compensating fishermen. But this kind of open-ended liability is something no global shipowner can accept.”

X-Press Feeders points to international maritime conventions that cap liability for shipping accidents. In fact, a UK court ruling in 2023 limited the company’s liability to £19 million (about $25 million) — a judgment that Sri Lanka is now trying to overturn.

Meanwhile, a separate case in Singapore’s International Commercial Court has been paused while the legal battle plays out in London. A pre-trial hearing there isn’t expected until May 2026.

What about accountability?

Sri Lanka’s court has said non-compliance could trigger criminal proceedings — and while it’s unclear how a foreign company can be forced to pay, there are real human consequences.

Captain Vitaly Tyutkalo, the Russian national who was commanding the X-Press Pearl, has been barred from leaving Sri Lanka for more than four years. X-Press Feeders offered to pay a fine to release him — but Sri Lankan authorities declined.

Environmental activists say this isn’t just about corporate responsibility — it’s about justice for communities and ecosystems still suffering years later.

 A global reckoning for shipping?

At its heart, the standoff highlights a deeper question: Should the shipping industry be held fully accountable for environmental disasters — even if the costs are astronomical?

Yoskovitz believes the implications stretch far beyond Sri Lanka’s shores. “This is about more than one ship or one company,” he said. “It’s about how the global shipping industry can function if vessels are exposed to unlimited, unpredictable liabilities every time they enter a port.”

As the case unfolds across three continents, the final verdict could reshape how the world handles maritime accidents — and who pays the price when things go catastrophically wrong.