International Laws Of The Sea – Part 15

Pursuant to the earlier topic of Introduction to Maritime Law in Malaysia, published on 22 February 2021, in the coming series the basis and elements of International Laws of The Sea, will be explored.

International Seabed Authority

1. Institutional structure of the International Seabed Authority

   The Authority is comprised of three principal organs:

   1. an Assembly made up of all members of the Authority and entrusted with the powers to set general policy
   2. a Council with powers to make executive decisions, made up of 36 members elected from among the members of the Authority
   3. a Secretariat headed by a Secretary-General.
      The 1982 Convention establishes two organs of the Council to assist it in carrying out its responsibilities – an Economic Planning Commission and a Legal and Technical Commission. The Convention also establishes a mining arm of the Authority called the Enterprise.

2. The Enterprise

   Article 170 of the 1982 Convention establishes the Enterprise as the mining arm of the International Seabed Authority. According to this article and the Statute of the Enterprise adopted together with the Convention, the Enterprise is the organ of the Authority responsible for carrying out activities in the Area directly as well as the transporting, processing and marketing of minerals recovered from the Area. In developing the resources of the Area, the Enterprise is required to operate in accordance with sound commercial principles. It must also act in accordance with the general policies of the Assembly and the directives of the Council, and it enjoys autonomy in the conduct of its operations.
   The Enterprise has its own Governing Board, a Director-General and the staff necessary for the exercise of its functions. It must conduct its initial deep seabed mining operations through joint ventures. Upon the approval of a plan of work for exploitation by an entity other than the Enterprise, or upon receipt by the Council of an application for a joint-venture operation with the Enterprise, the Council will take up the issue of the functioning of the Enterprise independently of the Secretariat of the Authority. If joint-venture operations with the Enterprise accord with sound commercial principles, the Council will issue a directive providing for such independent functioning.

3. Functions of the Authority

   Outlining the system of exploration and exploitation, Article 153 of the 1982 Convention states:
   Article 153System of exploration and exploitation

   1. Activities in the Area shall be organized, carried out and controlled by the Authority on behalf of mankind as a whole in accordance with this article as well as other relevant provisions of this Part and the relevant Annexes, and the rules, regulations and procedures of the Authority.
   2. Activities in the Area shall be carried out as prescribed in paragraph 3:
      1. by the Enterprise, and
      2. in association with the Authority by States Parties, or state enterprises or natural or juridical persons which possess the nationality of States Parties or are effectively controlled by them or their nationals, when sponsored by such States, or any group of the foregoing which meets the requirements provided in this Part and in Annex III.
   3. Activities in the Area shall be carried out in accordance with a formal written plan of work drawn up in accordance with Annex III and approved by the Council after review by the Legal and Technical Commission. In the case of activities in the Area carried out as authorized by the Authority by the entities specified in paragraph 2(b), the plan of work shall, in accordance with Annex III, article 3, be in the form of a contract. Such contracts may provide for joint arrangements in accordance with Annex III, article 11.
   4. The Authority shall exercise such control over activities in the Area as is necessary for the purpose of securing compliance with the relevant provisions of this Part and the Annexes relating thereto, and the rules, regulations and procedures of the Authority, and the plans of work approved in accordance with paragraph 3. States Parties shall assist the Authority by taking all measures necessary to ensure such compliance in accordance with article 139.
   5. The Authority shall have the right to take at any time any measures provided for under this Part to ensure compliance with its provisions and the exercise of the functions of control and regulation assigned to it thereunder or under any contract. The Authority shall have the right to inspect all installations in the Area used in connection with activities in the Area.
   6. A contract under paragraph 3 shall provide for security of tenure. Accordingly, the contract shall not be revised, suspended or terminated except in accordance with Annex III, articles 18 and 19.With a view to simplifying matters and making the exploitation regime more acceptable to all groups of states, paragraphs 1–3 of s.1 of the 1994 Agreement add:
      1. The International Seabed Authority (hereinafter referred to as ‘the Authority’) is the organization through which States Parties to the Convention shall, in accordance with the regime for the Area established in Part XI and this Agreement, organize and control activities in the Area, particularly with a view to administering the resources of the Area. The powers and functions of the Authority shall be those expressly conferred upon it by the Convention. The Authority shall have such incidental powers, consistent with the Convention, as are implicit in, and necessary for, the exercise of those powers and functions with respect to activities in the Area.
      2. In order to minimize costs to States Parties, all organs and subsidiary bodies to be established under the Convention and this Agreement shall be cost-effective. This principle shall also apply to the frequency, duration and scheduling of meetings.
      3. The setting up and the functioning of the organs and subsidiary bodies of the Authority shall be based on an evolutionary approach, taking into account the functional needs of the organs and subsidiary bodies concerned in order that they may discharge effectively their respective responsibilities at various stages of the development of activities in the Area.

4. System of exploration and exploitation

   The Authority can exercise such control over activities in the Area as is necessary for the purpose of securing compliance with the relevant provisions of Part XI and the Annexes relating thereto, and the rules, regulations and procedures of the Authority, and the plans of work approved by the Council. The Authority has the right to take at any time any measures provided for under Part XI to ensure compliance with its provisions and the exercise of the functions of control and regulation assigned to it thereunder, or under any contract. It will also have the right to inspect all installations in the Area used in connection with activities in the Area.

5. Pioneer Investors

   After the adoption of the Convention on the Law of the Sea in Montego Bay, Jamaica in 1982, a Preparatory Commission for the International Seabed Authority and for the International Tribunal for the Law of the Sea was established to prepare for the setting-up of both institutions. The Preparatory Commission proceeded with the implementation of an interim regime adopted by UNCLOS III, designed to protect those states or entities that had already made a large investment in seabed mining.
   This so-called Pioneer Investor Protection regime allowed a state, or a consortium of mining companies sponsored by a state, to be registered as a Pioneer Investor. The Authority was required to reserve for the Pioneer Investor a specific mine site in which the registered Investor was allowed to explore for manganese nodules. A Pioneer Investor was also obligated to explore a mine site reserved for the Enterprise and undertake other obligations, including the provision of training to individuals designated by the Preparatory Commission.
   This was one way of enabling the Authority and the Enterprise to gain experience and acquire the technology and skills required to engage in mining activities on their own. Accordingly, the Preparatory Commission registered seven Pioneer Investors: China, France, India, Japan, the Republic of Korea and the Russian Federation, as well as a consortium known as the Interoceanmetal Joint Organization (IOM).When the 1982 Convention entered into force and the International Seabed Authority became functional, these Pioneer Investors were supposed to become contractors according to terms contained in the 1982 Convention and the 1994 Agreement as well as regulations adopted by the International Seabed Authority.

6. Challenge of mining the ocean floor

   Deep seabed mining is an enormous challenge. It is supposed to take place at a depth of more than 15,000 feet of open ocean, hundreds of miles from land. Mining ships are expected to remain on station five years at a time, working without a stop, and to transfer the seabed minerals they bring up to auxiliary vessels to carry to the shore.
   The initial target of this mining activity was the potato-sized manganese nodules found on the deep ocean floor and containing a number of important metals and minerals. The road to market for these metals and minerals is long, hard and expensive. The potato-sized nodules seem to lie two to three miles – about five kilometres – down, in pitch-black water where pressures exceed 7,000 pounds per square inch and temperatures are near freezing. What is more, many of the ocean floors are known to be filled with treacherous hills and valleys, making the task of mining and transporting the minerals to the shore all the more challenging.
   Companies have tried many mining systems, including the hydraulic suction dredge method, a continuous-line bucket system and the so-called shuttle system. Under the shuttle system a remotely operated vehicle with television ‘eyes’ and powerful lights is sent down to crawl over the ocean floor, gobble up and crush nodules and resurface with its catch. Under the continuous-line bucket system, empty buckets are lowered to the bottom of the ocean and later raised, partially filled with nodules. But this system has been discarded because of low recovery rates. The shuttle system too has been shelved because its operational and investment costs far exceed the costs of more conventional approaches. Thus, the one method remaining under positive active consideration is the hydraulic suction and dredge system. Even here there appear to be a number of technological problems to be worked out before this method is ready for commercial application.
   Apart from the mineral resources of the deep seabed, there are other resource exploitation possibilities in the high seas and the deep seabed. The potential for the economic exploitation of biodiversity resources is one example. As the finite resources to be found on land start to dwindle, states may look to exploit various resources of the sea, including biodiversity. The seas and oceans are rich not only in mineral resources and fossil fuels, but also in other forms of resources, and the process to exploit them could accelerate in years to come.

7. International Seabed Authority in action

   After some delays the International Seabed Authority, an autonomous international organisation established under the 1982 Convention and the 1994 Agreement relating to the Implementation of Part XI of the United Nations Convention on the Law of the Sea, has started to carry out its activities. The Authority has issued:

   1. the Regulations on Prospecting and Exploration for Polymetallic Nodules in the Area (adopted 13 July 2000) which was later updated and adopted on 25 July 2013
   2. the Regulations on Prospecting and Exploration for Polymetallic Sulphides in the Area (adopted 7 May 2010)
   3. the Regulations on Prospecting and Exploration for Cobalt-Rich Crusts (adopted 27 July 2012).

   The complete set of these regulations will form part of the Mining Code, together with recommendations by the Authority’s Legal and Technical Commission for the guidance of contractors on the assessment of the environmental impacts of exploration for polymetallic nodules.

8. Summary and conclusions

   The slow progress in mining the ocean floor is attributable not only to technological problems but also to the changed political and economic environment of the world since the adoption of the Convention of the Law of the Sea in 1982. Indeed, prospects for seabed mining, and especially the commercial viability of the undertaking, depend to a large degree on the market conditions for the metals to be produced from seabed nodules. Economic and political conditions have changed a great deal since the adoption of the Convention, and the degree of optimism that existed at the time is no longer there. Hence, although an enormous amount of time, effort and energy was spent developing and establishing a comprehensive regime for mining the deep seabed, the idea has not taken off and the real benefits.

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This article is written by our Principal Associate, Chakaravarthi