The 16th session of the International Seabed Authority concluded last week with the Authority making the first request for an advisory opinion in relation to Part XI of the Law of the Sea Convention. Under Article 191 of the Convention, either the Assembly or the Council of the Authority may make a request to the Seabed Disputes Chamber for an advisory opinion on legal questions arising within the scope of their activities.
The request from the Authority asks for clarification on a number of issues arising under Part XI of the Convention, namely:
1. What are the legal responsibilities and obligations of States Parties to the Convention with respect to the sponsorship of activities in the Area in accordance with the Convention, in particular Part XI, and the 1994 Agreement relating to the Implementation of Part XI of the United Nations Convention on the Law of the Sea of 10 December 1982?
2. What is the extent of liability of a State Party for any failure to comply with the provisions of the Convention, in particular Part XI, and the 1994 Agreement, by an entity whom it has sponsored under Article 153, paragraph 2 (b), of the Convention?
3. What are the necessary and appropriate measures that a sponsoring State must take in order to fulfill its responsibility under the Convention, in particular Article 139 and Annex III, and the 1994 Agreement?
The advisory opinion request has its origins in a communication from Nauru asking for clarification as to the obligations imposed by the Convention on states sponsoring mining companies under Part XI of the Convention. Nauru had initially sponsored an application from a private company to the Authority to undertake exploration activities in the Area but it had withdrawn its sponsorship for a number of reasons, including the uncertainty over the obligations it would incur as the sponsoring state. As noted in the communication from Nauru:
Nauru, like many other developing States, does not yet possess the technical and financial capacity to undertake seafloor mining in international waters. To participate effectively in activities in the Area, these States must engage entities in the global private sector (in much the same way as some developing countries require foreign direct investment). Not only do some developing States lack the financial capacity to execute a seafloor mining project in international waters, but some also cannot afford exposure to the legal risks potentially associated with such a project. …
Ultimately, if sponsoring States are exposed to potential significant liabilities, Nauru, as well as other developing States, may be precluded from effectively participating in activities in the Area, which is one of the purposes and principles of Part XI of the Convention
All private companies wishing to participate in mining activities in the International Seabed Area must be sponsored by a State Party to the Law of the Sea Convention. According to Article 4(4) of Annex III of the Convention:
“The sponsoring state or states shall, pursuant to Article 139, have the responsibility to ensure, within their legal systems, that a contractor so sponsored shall carry out activities in the Area in conformity with the terms of its contract and its obligations under this Convention. A sponsoring State shall not, however, be liable for damage caused by any failure of a contractor sponsored by it to comply with its obligations if that State Party has adopted laws and regulations and taken administrative measures which are, within the framework of its legal system, reasonably appropriate for securing compliance by persons under its jurisdiction.”
The question raised by Nauru is precisely what states must do in order to satisfy this responsibility. On the one hand, it might simply require states to provide a means in their legal systems through which contractors can be held to account. Yet, as suggested by Nauru, the simple enactment of legislation may not “ensure … conformity” with the Convention. The alternative interpretation is that sponsoring states have some duty to oversee the activities of contractors when operating in the Area and to audit their activities. As noted above, developing countries may struggle to fulfil an obligation to monitor whether companies they have sponsored are actually complying with the Convention. In my view, however, this latter interpretation is less convincing. The responsibility is expressly to “ensure within their legal systems.” The second sentence also provides context to the interpretation by suggesting that the adoption of laws, regulations or other administrative measures is sufficient to satisfy this requirement. Moreover, it is foreseen by the Convention that the Authority itself will “inspect activities in the Area to determine whether provisions of [Part XI], the rules, regulations and procedures of the Authority, and the terms and conditions of any contract with the Authority are being complied with.” (see Article 165(2)(m) of the Convention). Requiring sponsoring states to oversee seabed activities as well would simply duplicate this regulatory function. On this view, it would seem that the most convincing interpretation is that sponsoring states are required to provide remedies against contractors if they are found by the Authority to be failing in their contractual or other obligations.
The request will be considered by the Seabed Disputes Chamber, an international court composed of 11 judges elected from amongst the judges of the International Tribunal for the Law of the Sea. The Chamber is currently presided over by Tullio Treves from Italy. The response to this request will be one further step towards clarifying the legal framework that applies to deep seabed mining. Who knows, one day there might actually be some deep seabed mining!