INTERNATIONAL SEABED AUTHORITY, IN TWO-WEEK SESSION, MAKES PROGRESS ON PREPARATION OF MINING CODE
Press Release
SEA/1608
INTERNATIONAL SEABED AUTHORITY, IN TWO-WEEK SESSION, MAKES PROGRESS ON PREPARATION OF MINING CODE
19980831 Termination of Provisional Membership Creates Budgetary Problems for 1999; October Meeting in New York Planned to Conclude Fourth Session(Reissued as received.)
KINGSTON, 28 August (International Seabed Authority) -- The International Seabed Authority, which temporarily adjourned its fourth session in Kingston, Jamaica today, made progress in its work on the draft seabed mining code. The code is a set of regulations to govern exploration of polymetallic nodules in the international area of the seabed, as part of the "common heritage" regime set up by the 1982 United Nations Convention on the Law of the Sea and related 1994 Agreement.
The review of regulations, based on a text prepared by the Legal and Technical Commission, was carried out in informal meetings of the 36-member Council, open to all 138 members of the Authority. The work will continue on a priority basis at the Authority's fifth session, scheduled to be held from 9 to 27 August 1999 in Kingston.
"Deep sea mining is still far away, but it is important to have the rules in place", said Council President Joachim Koch (Germany).
While the work continues on the code covering polymetallic nodules -- mineral-bearing lumps of minerals lying on the deep seabed -- a new code-writing task for the Authority was initiated at the Kingston meetings from 17 to 28 August. The Russian Federation formally requested the Authority to adopt regulations on rules for exploration of seabed resources other than nodules -- such as heat-generated polymetallic sulphides and cobalt-bearing crusts. Under a provision of the Convention, the Authority is required to adopt rules on resources other than polymetallic nodules within three years from the date of a request by an Authority member.
The Authority was established in 1994 when the Convention entered into force, and was financed by the United Nations regular budget until this year. The Authority is facing immediate financial problems due to non-payment of the
1998 assessed contributions by a number of members. An appeal for payment of the outstanding contributions was made by the Assembly.
The budgetary problem is compounded by the uncertain future membership status of the 11 provisional members which together account for one-third of the total assessments this year -- among them Belgium, Canada, Switzerland and the United States. The provisional members are those which have not yet ratified the 1982 United Nations Convention on the Law of the Sea. Provisional members which have not ratified by 16 November 1998 will no longer be members of the Authority after that date, and the other members will have to assume a larger part of the Authority's costs.
Budget for 1999
The Assembly approved a 1999 budget of $5,011,700 for the Authority's operations, about 10 per-cent below the amount proposed by Secretary-General Satya N. Nandan. Mr. Nandan described this as "a bare-bones budget". In addition to keeping the Authority's staff to a minimum (a total of 36 professional and general service staff), budget savings were effected by a shift in the 1999 meeting schedule. The Assembly decided that "in view of the prevailing exceptional budgetary situation," only one session of three weeks will be held, from 9 to 27 August 1999, in Kingston -- instead of the two two-week sessions normally held in March and August. The Latin American and Caribbean group stressed that this cost-cutting decision must not be taken as a precedent regarding the schedule of future Authority sessions.
Scale of Assessments
The question of how to determine the scale of assessments for contributions to the 1999 budget became an issue, and the controversy led to an unprecedented formal vote in the Council. The Eastern European group argued, as a matter of principle, that the Authority should use the 1999 scale set by the United Nations General Assembly to apportion the Authority's assessments for the 1999 budget. The amendment to this effect, proposed by the Russian Federation, was rejected by a vote of 26 to 3, with the majority favouring the use of the 1998 United Nations scale instead.
The Assembly decided to postpone a decision on this question until later this year, when it will meet for a day or two at United Nations Headquarters in New York to decide which year's scale will apply. With this issue unresolved, the fourth session was not concluded but was "temporarily adjourned". Secretary-General Nandan said the New York meeting could be convened between 12 and 16 October. At the same time, the Council has asked the Finance Committee to examine next year the question of which year's United Nations scale should be used as basis for the Authority's scale of assessments.
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Progress on Mining Code
Efforts were made by the Council during the two weeks to complete its first review of the draft regulations on prospecting and exploration for polymetallic nodules in the international seabed area. Council President Koch reported at the final meeting Friday that real progress was made and that he and the secretariat had prepared an informal revision of regulations 2 to 21 of the code, to be circulated later. The Council agreed that, in the organization of its work for the fifth session, priority should be given to the Mining Code.
The draft mining code was presented to the Council by the 22-member Legal and Technical Commission during the Authority's March session. It contains proposals on how the Authority will oversee prospecting and exploration by private and public contractors interested in recovering mineral-rich lumps containing manganese, nickel, cobalt and copper from ocean bottoms beyond any nation's jurisdiction. The code has a basic text of 33 regulations, with annexes containing a model contract and standard clauses. Its terms are based on provisions in the two basic instruments governing the work of the Authority -- the 1982 United Nations Convention on the Law of the Sea and the 1994 Agreement relating to the implementation of Part XI (seabed provisions) of the Convention.
The document will be taken up in formal meetings only after consensus is reached on the entire text.
Comments from a number of representatives highlighted the need for a revision of some regulations to make clear that prospecting has to observe the provisions on the protection of the environment. Allied to this was the issue of "financial and technical capabilities" of contractors, and their liability for damage to the environment. Delegates debated various suggestions, including one that pioneer investors be required to give environmental guarantees to ensure that the financial resources would be available to cover the speedy repair of damage in the event of an ecological disaster, and that contractors be obliged to obtain insurance coverage. Confidentiality and compliance
The issue of confidentiality was raised in connection with a number of provisions, including one stating that the Secretary-General shall "from time to time inform all members of the Authority, without reference to a particular prospector, of the areas in which prospecting is being conducted". Some delegates questioned the need to conceal the identity of prospectors. On the provision covering "receipt, acknowledgement and safe custody of applications", delegates wanted clarification on guidelines to determine the difference between confidential information in an application and information of a "general nature" which would be circulated to the members of the Legal and Technical Commission.
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The issue of compliance by contractors with international standards was also highlighted. Some delegates felt that contractors should not be limited to the rules, regulations and procedures of the Authority and that the mining code should also take into account existing international standards relevant to the marine environment, such as those contained in the Barcelona Convention. The Council President said that while Contractors required some guarantee of certainty, it would not be justifiable to exempt them from abiding by new rules on the protection of the environment which may become applicable.
Rights of Contractors
Delegates spent time considering conditions under which the Commission may decide to deny an application from any potential contractor, and the method the Secretary-General should use to indicate the reasons for the action. On other regulations, a number of delegations felt that specific references should be made to the interests of coastal States, and some sought clarification on the distinction between the Area and national jurisdiction.
There was extensive debate on regulation 20, which refers to the priority given to contractors holding approved plans of work for exploration over other applicants submitting plans of work for exploitation of the same area or resources. Views were also mixed on the provision for withdrawal of priority if a contractor fails to comply with requirements of the work plan within a specified time. Also discussed were regulations dealing with the total area allocated to the contractor, and the requirements regarding relinquishment of a part of the allocated area.
Russian Proposal
At the Assembly meeting on 17 August the Russian Federation called for the Authority to start work on rules for exploration of seabed resources other than polymetallic nodules (document ISBA/4/A/CRP.2).
The proposal invokes article 162, subparagraph 2 (o) (ii) of the 1982 United Nations Convention on the Law of the Sea. This requires the Authority to adopt rules on resources other than polymetallic nodules within three years from the date of a request by any Authority member. The Russian Federation said its statement was "an official request to the Authority".
The Russian statement noted that seabed mineral resources other than polymetallic nodules -- particularly hydrothermal polymetallic sulphides, and cobalt-bearing crusts -- may be of greater economic significance than nodules. Research carried out by American, Russian and other scientists shows that "deposits of these resources discovered in the international seabed area are comparable in size to the deposits on land"; for example, the zinc in polymetallic sulphides may amount to 37 percent of the zinc available on land.
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Cobalt resources in crusts are also very large, the Russian paper states. Metals available from one ton of such crusts in some sites increased in value from $83 in 1972 to $571 in 1998, while the metals in a ton of nodules would have been worth $85 in 1972 but only $288 in 1998.
It was no secret that "systematic research" on other kinds of mineral resources has been carried out in the Pacific and Atlantic Oceans, according to the Russian statement. Russian enterprises have carried out research and survey work on cobalt-bearing crusts (in the Magellan Seamount Area) and on polymetallic sulphides (on the Mid-Atlantic Ridge), "and there is a certain priority in discovering the deposit areas".
"We cannot exclude the possibility that in connection with the situation in the metals market, more focus may now turn to other kinds of raw materials," the Russian Federation said in requesting the Authority to begin work on its rules for such exploration.
Training
The Legal and Technical Commission considered the reports it received from the pioneer investors during 1997 and 1998 (which are not made public), as well as the implementation of the training program submitted by the Government of the Republic of Korea and approved by the Commission during its meeting in August 1997. Of the 60 applications received, four candidates and four alternate candidates were selected for training which will commence in March 1999. The candidates are from Ukraine and the Philippines, for studies in marine geology; Bangladesh (marine geophysics) and Cameroon (electronic engineering). The alternates are from Brazil, Kenya, Malaysia and Uruguay.
A number of delegations expressed their approval of the workshop on the development of guidelines for the assessment of possible environmental impacts arising from exploration for polymetallic nodules, convened by the Authority and held in China in June 1998. Secretary-General Nandan said the guidelines will be submitted to the Legal and Technical Commission for its consideration.
In his report to the Assembly, the Secretary-General said approval of plans of exploration work by seven registered pioneer investors was among the Authority's most important milestones. These plans of work, approved by the Council last August, will be issued by the Secretariat in the form of contracts when the mining code is completed.
The pioneer investors, in order of approval, are: the Government of India; French Institute of Research for the Exploitation of the Sea (IFREMER)/French Association of Studies and Research of Nodules (AFERNOD); Deep Ocean Resources Development Co., Ltd. (DORD), Japan; Yuzhmorgeologiya, Russian Federation; China Ocean Minerals Research and Development Association (COMRA); Interoceanmetal Joint Organization (IOM), consisting of Bulgaria,
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Cuba, Czech Republic, Poland, Russian Federation and Slovakia; and the Government of the Republic of Korea.
Finances of Seabed Authority
The authorized budget of $5,011,700 for 1999 takes into account a reduction in the meeting schedule for next year to a single three-week, instead of two two-week sessions. The 1999 budget reflects an increase of 6.5 per cent over the current year's budget.
Of the total, $3,811,400 is for operational and administrative functions including staff costs. While it had been envisaged that the Secretariat would require a total of 44 posts by 1999, no additional posts have been requested for 1999. The remaining $1,200,300 is to cover conference services for the 1999 session. The decision to reduce the meeting schedule, which saves an estimated $240,500, was made in the light of the critical budgetary situation being faced by the Authority.
At the first meeting of the Assembly, President Tadeusz Bachleda-Curus (Poland) made an urgent appeal for members to pay their assessed contributions to the Authority. The appeal was repeated in a resolution of the Assembly. Only 59 members had paid a total of $2,856,283 towards the 1998 budget, leaving an outstanding balance of $1,847,617. The amount received by the working capital fund stood at $118,430, representing a shortfall of $77,570.
Secretary-General Nandan informed the Council that with a current monthly expenditure of approximately $250,000, the Authority would be in arrears to the tune of $184,961 by the end of August unless additional contributions were received. The Council was also informed that in the draft financial regulations to be taken up next session, the Finance Committee had proposed the adoption of a biennial budgetary system. It was felt that this would be more cost-effective and better address the practical needs of the Authority.
Scale of Assessed Contributions
In view of the uncertainty over the status of the 11 provisional members of the Authority after 16 November 1998 (whose membership after that date depends upon their ratification of the Convention), the Secretariat prepared two "indicative" 1999 scales of assessment based on the $5,011,700 budget. One scale included all 138 members while the other omitted the 11 provisional members. These 11 countries are assessed to pay approximately one third of the total budget.
Under the "indicative" scenario in which none of the provisional members would remain next year, Japan would become the largest contributor, assessed at 25 per cent of the budget for 1999 (over $1,200,000). The Council held
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prolonged consultations in an effort to reach consensus on the scale of assessment of contributions of members of the Authority. The scale of assessments adopted in 1997, covering the 1998 budget of the Authority, was based on the 1997 United Nations scale. Assessments range from 0.01 per cent at the bottom to a top rate of 25 per cent.
Although the Council had voted to recommend Assembly adoption of the 1998 scale, the Assembly was not in a position to vote due to the lack of a quorum for voting. Only 66 of the 138 Authority members were represented at the August meetings, less than a majority of the 138 members required by the Convention for voting in the Assembly.
Since the matter could not be resolved by consensus, the Assembly decided to defer further action on the scale of assessments until later this year when it meets at United Nations Headquarters in mid-October.
Headquarters Discussion
Updating the Assembly on the headquarters situation, Mr. Nandan referred to the letter of 10 March 1998 in which the Government of Jamaica had offered the building currently occupied by the Authority for its permanent use. The Authority had been awaiting an assessment of the condition of the building and an estimate of the costs for its future maintenance. It was only on 13 August that the engineers had been permitted to enter the building to make this assessment.
The additional space offered since August 1997 as an interim measure had also failed to materialise and as a result, the staff of the Secretariat were obliged to work under very cramped conditions which were not conducive to efficient operation. The representative of Jamaica gave the assurance that action at the highest political level would be taken to ensure a speedy resolution.
Provisional Members
The Assembly heard comments of delegates and the Secretary-General referring to the uncertain future membership status of the 11 provisional members of the Authority. As noted in the Secretary-General's report, provisional members which by 16 November have not ratified the 1982 Convention related 1994 Agreement would no longer be members of the Authority, under the terms of the 1994 Agreement.
There are potential budgetary implications, since the Authority assesses contributions from provisional members as well as regular members. For the 11 provisional members, the assessed contributions for the 1998 period amounted to $1,525,923 -- nearly one third of the total Authority budget of $4,703,900 for 1998. The largest assessments were for the United States ($1,175,975, not
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yet paid), Canada ($149,532, paid), and Switzerland ($58,178, paid $52,996). Assessed amounts due for 1998 have not been paid by the other provisional members (Bangladesh, Belarus, Belgium, Nepal, Poland, Qatar, Ukraine, and United Arab Emirates). One provisional member, Poland, has informed the Authority that its ratification process would soon be completed.
The representative of the United States, saying her country remained "committed to the Law of the Sea Convention", briefed delegates on efforts of the United States Government to obtain early action by the Senate to approve the Convention. Delegates expressed concern about the status of the provisional members after 16 November. The Assembly asked the Secretary-General to communicate with provisional member Governments to remind them of the situation.
Protocol on Privileges and Immunities
At a formal treaty signing ceremony held on 26 August, the first signatures were recorded approving the Protocol on the Privileges and Immunities of the International Seabed Authority.
Countries signing the Protocol during the ceremony included Bahamas, Indonesia, Jamaica, Netherlands and Trinidad and Tobago. Two other countries, Brazil and Kenya, signed later.
The signing ceremony was supervised by Palitha Kohona, Chief of the Treaty Section of the United Nations Office of Legal Affairs, on behalf of United Nations Secretary-General Kofi Annan. Present also were the President of the Assembly of the International Seabed Authority, Tadeusz Bachleda-Curus (Poland); Secretary-General Satya N. Nandan and delegates to the International Seabed Authority's session.
The Protocol, which was adopted by the Assembly of the Authority on 26 March, will be open for signature until 16 August 2000 at United Nations Headquarters in New York. It will enter into force 30 days after the tenth instrument of ratification or accession.
The Protocol is based substantially on the Convention on the Privileges and Immunities of the United Nations of 1946. It covers such matters as the legal personality of the Authority, inviolability of Authority premises, financial facilities of the Authority, privileges and immunities of representatives of members of the Authority and Authority officials, and related matters.
Election to the Legal and Technical Commission
The resignations of three members of the Legal and Technical Commission were reported to the Council. Pierre Athomo-Ndong (Gabon), Helmut Beiersdorf
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(Germany) and Yuji Kajitani (Japan) were elected to replace Hans Amann (Germany), Marcellin Mve-Ebang (Gabon) and Toshio Sakasegawa (Japan). The new members will serve on the Commission until 31 December 2001.
Other Matters
According to the agenda adopted during the first part of the present session (document ISBA/4/C/2), the Council was also to consider the agreement between the Authority and the Government of Jamaica concerning the Headquarters of the Authority, an agreement concerning the relationship between the Authority and the International Tribunal for the Law of the Sea, and the staff and financial regulations of the Authority. These matters were not yet ready for its consideration and were deferred to the fifth session.
Members of Authority
The 138 members of the Authority, including 11 provisional members (P), are: Algeria, Angola, Antigua and Barbuda, Argentina, Australia, Austria, Bahamas, Bahrain, Bangladesh (P), Barbados, Belarus (P), Belgium (P), Belize, Benin, Bolivia, Bosnia and Herzegovina, Botswana, Brazil, Brunei Darussalam, Bulgaria, Cameroon, Canada (P), Cape Verde, Chile, China, Comoros, Cook Islands, Costa Rica, Cote d'Ivoire, Croatia, Cuba, Cyprus, Czech Republic, Democratic Republic of the Congo, Djibouti, Dominica, Egypt, Equatorial Guinea, European Community, Fiji, Finland, France, Gabon , Gambia, Georgia, Germany, Ghana, Greece, Grenada, Guatemala, Guinea, Guinea-Bissau, Guyana, Haiti, Honduras, Iceland, India, Indonesia, Iraq, Ireland, Italy, Jamaica, Japan, Jordan, Kenya, Kuwait, Lao People's Democratic Republic, Lebanon, Malaysia, Mali, Malta, Marshall Islands, Mauritania, Mauritius, Mexico, Micronesia (Federated States of), Monaco, Mongolia, Mozambique, Myanmar.
Also Namibia, Nauru, Nepal (P), Netherlands, New Zealand, Nigeria, Norway, Oman, Pakistan, Palau, Panama, Papua New Guinea, Paraguay, Philippines, Poland (P), Portugal, Qatar (P), Republic of Korea, Romania, Russian Federation, Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Samoa, Sao Tome and Principe, Saudi Arabia, Senegal, Seychelles, Sierra Leone, Singapore, Slovakia, Slovenia, Solomon Islands, Somalia, South Africa, Spain, Sri Lanka, Sudan, Suriname, Sweden, Switzerland (P), The former Yugoslav Republic of Macedonia, Togo, Tonga, Trinidad and Tobago, Tunisia, Uganda, Ukraine (P), United Arab Emirates (P), United Kingdom, United Republic of Tanzania, United States (P), Uruguay, Viet Nam, Yemen, Yugoslavia, Zambia and Zimbabwe.
Three former provisional members -- European Community, Gabon and the Lao People's Democratic Republic -- are now regular members, following their ratification of the Law of the Sea Convention this year.
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