PRIORITIES FOR SEABED AUTHORITY ARE DEVELOPMENT OF REGULATIONS FOR SEABED MINERALS, ENVIRONMENTAL PROTECTION, STATES PARTIES TOLD

Meeting of States Parties

to Law of Sea Convention

72^nd Meeting (AM)       

PRIORITIES FOR SEABED AUTHORITY ARE DEVELOPMENT OF REGULATIONS FOR SEABED

MINERALS, ENVIRONMENTAL PROTECTION, STATES PARTIES TOLD

Concerns Expressed Regarding Tribunal’s Budget, Tax Reimbursement for Staff

States parties to the Convention on the Law of the Sea heard about key developments concerning the International Seabed Authority and the Commission on the Limits of the Continental Shelf, and discussed various budgetary and administrative issues, as they continued their thirteenth meeting this morning.

Satya N. Nandan, Secretary-General of the International Seabed Authority, said the Authority’s main priority in the immediate future was the development of a regulatory regime for polymetallic sulphides and cobalt-rich crusts, and he expected that would be the focus of discussions this year.  It was important for the Authority to develop itself as a depository of available data on mineral resources and encourage research on mineral resources and the deep ocean environment.  He also outlined work to address ecological threats, including through the adoption of rules, regulations and procedures relating to the protection of the marine environment. 

Noting the low level of attendance at the Authority’s meetings in Kingston, Jamaica, he said it had declined to the point where it was difficult to secure a quorum needed to take decisions.  Responding to that concern, speakers in today’s debate called on all members to participate more actively in the forthcoming ninth session of the Authority, which would take place in Kingston from 28 July to 8 August.

Speaking for developing countries, the representative of Sierra Leone said the most significant reason for poor attendance at Authority meetings was a lack of resources and competing priorities.  He proposed that a trust fund be set up to assist delegations from developing and least developed countries in participating.  Jamaica’s representative suggested looking into changing the dates of the sessions in the future, as some countries found it difficult to take part in the work of the Authority in summer.

Another briefing was presented today by the Chairman of the Commission on the Limits of the Continental Shelf, Peter Croker.  One of the three major bodies established by the Convention, the Commission considers the data submitted by coastal States concerning claims to outer limits of the continental shelf that may extend beyond 200 nautical miles.  

To date, the Russian Federation was the only State to have submitted an application for extended continental shelf jurisdiction and the Commission had adopted its recommendations on the matter during its eleventh session in June 2002, he said.  Recently, the Commission had received a letter from the Russian Federation requesting clarifications on certain provisions of its recommendations, and the subcommission dealing with the submission would likely be asked to draw up a response to that letter.

The Commission had received no further submissions by 25 May, and its thirteenth session in August had been cancelled, he said.  The Division for Ocean Affairs and the Law of the Sea was currently preparing a training manual to further knowledge and skills in preparing State submissions.  In addition, a trust fund had been created by the General Assembly to assist coastal States with submissions, to which interested developing States had already applied.

Also considered this morning were several proposals related to the administrative and budgetary functioning of the Tribunal, which were introduced by the Registrar of the court, Philippe Gautier (Belgium).  The meeting was presented with two options in connection with national tax imposed by some countries on staff earnings from the Tribunal.  In this connection, several delegations supported the proposal by the United Kingdom to disburse the amount of the Tribunal’s staff assessment among member States and reimburse staff and members of the Tribunal from the budget for 2004 and 2005.  They also stressed that States that did not levy taxes on their citizens working in international organizations should not participate financially in the reimbursement of citizens who were taxed by their governments. 

Other matters before the meeting included a draft decision on benefits for judges, who could suffer accidents while performing official duties, and the need to address a $200,000 increase in resources needed for the maintenance of premises due to exchange rate fluctuation.

Also participating in today’s discussion were representatives of Benin, Trinidad and Tobago, the Russian Federation, Japan, United States and Australia.

The States parties to the Convention on the Law of the Sea will meet again on Wednesday at 10 a.m.

Work of Seabed Authority

Secretary General of the International Seabed Authority, SATYA N. NANDAN, reminded States parties that the ninth session of the Authority would take place in Kingston from 28 July to 8 August and the Legal and Technical Commission would begin its meetings a week in advance of the main session.  The main priority for the Authority in the immediate future was development of a regulatory regime for polymetallic sulphides and cobalt-rich crusts, and he expected that it would be the focus of discussions this year.  Other important matters included the Authority’s future work programme and the outcome of a workshop on the establishment of a geologic model for the Clarion-Clipperton Fracture Zone in the Central Pacific Ocean, which had taken place in Fiji in May.

He expressed concern that over the past few years, the level of attendance at meetings in Kingston had continued to decline to the point where it was difficult to secure a quorum of 72 members of the Authority (one half of the total).  That situation was clearly unacceptable, and he hoped it would not arise again in 2003.

One of the issues to be taken up by the Commission related to the draft regulations on polymetallic sulphides and cobalt-rich crusts, he said.  It was apparent from the discussions to date that a cautious approach to regulation was warranted.  The objective should be to progressively develop a regulatory regime as prospecting and exploration activities took place, while also acquiring better knowledge of the resources and the environment in which they occurred.  Strong emphasis should be placed on the need to gather and analyse environmental data according to standardized methodologies and formats.

Among other efforts undertaken by the Authority, he outlined work in relation to managing ecological threats resulting from marine scientific research, prospecting and exploration, including through the adoption of rules, regulations and procedures relating to the protection of the marine environment.  Also important were international cooperative scientific projects. 

The most constructive and useful work the Authority could do was to develop its capacity as a depository of available data about mineral resources and to encourage research and disseminate information about mineral resources and deep ocean environment, he said.  To maximize benefits from scientific research, it was essential that such research and exploration were conducted within the parameters set by the Convention itself.  That again underlined the importance of broad participation in meetings of the Assembly in order to ensure that views of all member States were taken into consideration and there was ongoing involvement of a political and legal nature in the work of the Assembly.

STAFFORD O. NEIL (Jamaica) stressed the importance of the Authority’s work.  Having completed its initial work and concluded the Seabed Mining Code, the Authority was now moving to other important activities, including extending regulatory framework to mining operations.  Also important, especially to the developing countries, were the Authority’s efforts to provide training, in particular through workshops. 

He agreed that with the work of the Authority becoming increasingly more technical in nature, it was extremely important for members to be engaged in the formulation of the work programme and providing general policy guidance to the Authority.  He also shared Mr. Nandan’s concern about falling participation in the work of the Authority.  As some delegations found it difficult to participate in the meetings of the Authority during summer, different timing could be considered in the future.  For now, he urged member States to make as great an effort as possible to attend the forthcoming session at the end of July.

ALLIEU KANU (Sierra Leone) said the most significant reason for poor attendance at International Seabed Authority meetings, from the point of view of developing countries, was a lack of resources and competing priorities.  He proposed that a trust fund be set up to assist delegations from developing and least developed countries in participating in Authority meetings.

GAILE RAMOUTAR (Trinidad and Tobago) thanked delegations who had expressed condolences for Tribunal Judge Lennox Fitzroy Ballah, of Trinidad and Tobago, who had passed away in March 2003.

Mr. ZINSOU (Benin) added that the absence of some developing countries was due to the lack of resources.  He supported the idea of providing funds for participation of African States, especially least developed countries, in the work of the Authority. 

Commission on Limits of Continental Shelf

PETER CROKER, Chairman of the Commission on the Limits of the Continental Shelf, reported that the subcommission set up to examine the Russian submission had made recommendations to the Commission in June 2002.  The recommendations were adopted during the Commission’s eleventh session in June 2002, and then conveyed to the submitting State and the Secretary-General.

To further knowledge and skills in preparing State submissions, the Division for Ocean Affairs and the Law of the Sea was currently preparing a training manual, he said.  In addition, a trust fund had been created by the General Assembly to assist coastal States with submissions.  Interested developing States had already applied to the fund, and several requests for reimbursement from the fund had been received.  A second trust fund had been established to help developing nations defray costs incurred when members they had nominated participated in Commission meetings.

In other developments, he continued, the Commission had received no further submissions by 25 May, and its thirteenth session in August had been cancelled.  Also, the Commission had received a letter from the Russian Federation requesting clarifications on certain provisions of its recommendations on the Russian submission.  The subcommission dealing with the Russian submission would likely be asked to draw up a response to that letter.

STEPAN Y.KUZMENKOV (Russian Federation) noted that, as the Commission had begun its consideration of his country’s submission, which was related to a definition by States of their continental shelves beyond 200 nautical miles, it had opened a new chapter in international cooperation in ocean affairs.  He was fully aware of his country’s great responsibility as a pioneer in that area.  He was also aware of the complexity of the challenges before the Commission.  An important factor here was the absence of precedents on which future work in presenting relevant material to the Commission and the study of those materials could be based.  Consideration of such comprehensive cases, which involved significant segments of the underwater continental shelf, was a lengthy process that had to go through several stages. 

Russia intended to continue that work to ensure that the results of multi-year research by both Russian and international scientists were reflected in the decision of the Commission, he said.  The recommendation of the Commission prepared last summer had been carefully considered by Russian experts.  He hoped that the Commission would promptly respond to his country’s recent letter, which included several questions regarding specific provisions of the recommendations and asked for certain clarifications on the matter. 

Tribunal Staff Assessment Fund

PHILIPPE GAUTIER (Belgium), Registrar of the Tribunal, presented the agenda item on Consideration of the Staff Assessment Fund.  He explained that some States collected national taxes on salaries paid by the United Nations, and that a fund made up of staff contributions had been set up to reimburse those employees for tax they paid, with the remainder given to States parties.  The Tribunal had adopted the same system, with employees contributing to the Staff Assessment Fund, which reimbursed members required to pay national tax on Tribunal earnings.

He then made two proposals for dealing with possible increases in expenditure in connection with national tax on staff earnings.  The first would be to use the fund contributions, which now amounted to $2.3 million, to create a special trust fund.  That fund would generate interest, which would be used to finance the reimbursement of national taxes paid by Tribunal staff.  The fund would cover annual reimbursements to the amount of $35,000, and it would no longer be necessary to maintain the Staff Assessment Fund.  Parties would then be financing net rather than gross salaries, leading to a yearly saving of $500,000.

The second option would be to include a credit in the budget to cover the reimbursement of national taxes, which would come to about $35,000 annually.  Consequently, Parties would be financing the budget based on calculations of net rather than gross salaries, saving $500,000 annually.  The balance of what had been paid up to now could then be given to States parties.

Mr. ZINSOU (Benin) said the proposals would allow the Tribunal to resolve questions related to the contribution fund, as well as reducing the Tribunal budget.  They would allow the Tribunal to arrive at a budget based on net salaries, which would reduce the total budget amount, and, consequently, contributions made by States to finance it.  The first proposal had clear advantages over the second, since it retained the contribution fund.  It allowed for the fund to be invested, and to finance the reimbursement of national taxes through dividends received.

Mr. NEIL (Jamaica) said that he preferred the first proposal.  However, he wanted to know if the assumption of an interest rate of 1.1 per cent was realistic. 

Mr. GAUTIER said that the interest rate was, indeed, rather low.  However, it reflected the current situation in the market.  It also took into account the fact that only short-term investments were allowed under financial regulations.  At this time, the figure was realistic, but the situation could improve in the future.

Ms. MULVEIN (United Kingdom) proposed that the total amount in the Staff Assessment Fund as of 31 December 2002 -- $2.3 million -- be returned to States Parties pro rata to their contributions.  Also, a budget line should be established for the 2004 and 2005 Tribunal budgets to allow for reimbursement of national taxes paid by staff for Tribunal earnings.  After 2005, that budget line should be removed.  Finally, the Registrar should enter into bilateral negotiations with States levying national taxes on remuneration paid by the Tribunal.

She also asked the Registrar for clarification on his figure of $35,000 paid out in remuneration of national taxes paid, since the amount seemed considerably more than that paid out to date.

Mr. GAUTIER responded that the $35,000 amount was based on an estimate for future staff remuneration of national taxes paid, and was dependent on salary levels expected for 2004.  The estimate took into consideration that two staff members and one member of Tribunal would be affected by national taxes.

Mr. KUZMENKOV (Russian Federation) agreed with the United Kingdom, saying that neither of the two proposals on the taxation fund suited his delegation.  States that did not levy taxes on their citizens working in international organizations should not participate financially in the reimbursement of citizens who were taxed by their governments.  Two systems that met that main condition already existed within the United Nations, in particular at the Food and Agriculture Organization (FAO) and the International Labour Organization (ILO).  “We should not try to reinvent the wheel”, he said.  A new proposal by the United Kingdom should be further addressed in informal consultations.

YOSHIYUKI MOTOMURA (Japan) stressed the importance of two main issues in that respect:  dealing with the amount of $2.3 million, which should be surrendered to member States; and tackling the situation where some States did not exempt their citizens working in international organizations from tax liability.

Ms. HAYES (United States) said her Government did not want other countries to subsidize taxes of United States citizens and residents, and understood the reluctance of other delegations in that respect.  The United States had entered into tax agreements with about 20 organizations with United States citizens or residents on their staff.  However, because the United States was not yet party to the Convention on the Law of the Sea, it would have no source of funds to cover the tax liabilities of its members.

She added that her country was currently drafting a tax reimbursement agreement with the United Nations Educational, Scientific and Cultural Organization (UNESCO), since it would be rejoining that organization this year.  It could do the same when it acceded to the Convention on the Law of the Sea, but she said she did not know when that would occur.

ALLIEU KANU (Sierra Leone) said he could not support the proposals on staff remuneration for national taxes without further reflection or consultation with his mission.  He added, however, that the proposal from the United Kingdom seemed sound, and asked her to make it available to delegations.

CRISPIN CONROY (Australia) said the United Kingdom’s proposal was an attractive one, and that he would have concerns with the other two proposals, for the reasons stated by the Russian Federation.

Other Budgeting Matters

Presenting the agenda item on consideration of other budgetary matters, Mr. GAUTIER noted that the exchange rate fluctuation had reached more than 20 per cent in one year, which had a direct impact on “maintenance of premises”, since those costs were in euros.  When the budget for 2003 had been adopted, it had included a provision of $815,000, but the amount had increased by $200,000 by March, to cover the planned expenditure in euros.

Another proposal intended to cover the liability of the Tribunal with respect to accidents, which could occur to judges when they were performing official duties, Mr. Gautier said, introducing a draft decision contained in document SPLOS/2003/WP.4/Rev.1.  While the staff members of the Tribunal were covered in the event of work-related accidents under the staff regulations and rules, the judges did not have any scheme to cover them.  The risk of accidents was not hypothetical.  Recently, a judge had fallen on an icy floor and two others had suffered minor injuries from electrically operated doors in the building.  Such accidents could entail liability of the Tribunal. 

The proposal was, therefore, to apply to the judges a scheme similar to the one applicable to the judges of the International Court of Justice.  As application of such a scheme would depend on the approval of the Secretary-General, it was proposed to authorize the Tribunal to negotiate with him on the matter.  In the meantime, in order to cover the liability of the Tribunal pending such an agreement, it was proposed to approve a budget line of $6,000, which would allow the Tribunal to contract an insurance policy to provide benefits equivalent to those provided by the United Nations.

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