The Kerala High Court has allowed MSC Elsa 3 compensation talks to resume alongside ongoing litigation, according to reports by The Times of India and LiveLaw. The decision on 27 October 2026 permits a state-appointed committee to restart discussions with Mediterranean Shipping Company (MSC).
The committee can evaluate damage and negotiate compensation, but cannot conclude a final settlement or a legally binding agreement. The outcome of its discussions must be submitted to the court.
Its work covers the costs of restoring coastal and marine environments, measures to address pollution, and economic damage suffered by the state and fishing communities. The court lifted the restriction imposed in June 2025 after considering subsequent developments and the state’s position that it did not oppose the committee resuming its work.
Preparations are also proceeding for a multibeam survey of the wreck. A contractor was selected during meetings convened by the Director General of Shipping on 17 and 20 October. The vessel owner will bear the survey costs.
The court gave stakeholders one week to submit proposals for the scope of the survey. The Kerala State Pollution Control Board and the state government are among those expected to provide input. The Director General of Shipping will consolidate the submissions, forward the finalised scope to the contractor and monitor the work.
The financial claims remain unresolved. Kerala has sought approximately $1.1 billion through an admiralty claim, while MSC has disputed the amount and applied to limit its liability to about $14.8 million. Court reporting separately records that the company furnished a bank guarantee of ₹1,227.62 crore under a judicial direction.
MSC Elsa 3 sank off Kerala in May 2025. Containers and plastic nurdles washed ashore after the casualty, affecting fishing activities and prompting cleanup operations along the coast. Concerns persist about pollution from the wreck and the containers still aboard.
Cargo manifests listed calcium carbide, rubber chemicals and nurdles among the goods carried by the vessel. Authorities have raised the possibility that containers remaining underwater may need to be removed.
MSC‘s lawyers have argued that lifting waterlogged containers could cause them to rupture and release further pollutants. They have also pointed to pumping operations already undertaken to recover fuel from the wreck.
The court is due to consider the matter again on 24 November 2026.
