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1. The operator shall transfer to the Authority, in accordance with its
rules, regulations and procedures and the terms and conditions of the plan
of work, at time intervals determined by the Authority all data which are
both necessary for and relevant to the effective exercise of the powers and
functions of the principal organs of the Authority in respect of the area
covered by the plan of work.
2. Transferred data in respect of the area covered by the plan of work,
deemed proprietary, may only be used for the purposes set forth in this
article. Data necessary for the formulation by the Authority of rules,
regulations and procedures concerning protection of the marine environment
and safety, other than equipment design data, shall not be deemed
proprietary.
3. Data transferred to the Authority by prospectors, applicants for
contracts or contractors, deemed proprietary, shall not be disclosed by the
Authority to the Enterprise or to anyone external to the Authority, but
data on the reserved areas may be disclosed to the Enterprise. Such data
transferred by such persons to the Enterprise shall not be disclosed by the
Enterprise to the Authority or to anyone external to the Authority.
The contractor shall draw up practical programmes for the training of
personnel of the Authority and developing States, including the
participation of such personnel in all activities in the Area which are
covered by the contract, in accordance with article 144, paragraph 2.
Article 16
Exclusive right to explore and exploit
The Authority shall, pursuant to Part XI and its rules, regulations and
procedures, accord the operator the exclusive right to explore and exploit
the area covered by the plan of work in respect of a specified category of
resources and shall ensure that no other entity operates in the same area
for a different category of resources in a manner which might interfere
with the operations of the operator. The operator shall have security of
tenure in accordance with article 153, paragraph 6.
Article 17
Rules, regulations and procedures of the Authority
1. The Authority shall adopt and uniformly apply rules, regulations and
procedures in accordance with article 160, paragraph 2(f)(ii), and article
162, paragraph 2(o)(ii), for the exercise of its functions as set forth in
Part XI on, inter alia, the following matters:
- administrative procedures relating to prospecting, exploration and
exploitation in the Area;
- operations:
- size of area;
- duration of operations;
- performance requirements including assurances pursuant to
article 4, paragraph 6(c), of this Annex;
- categories of resources;
- renunciation of areas;
- progress reports;
- submission of data;
- inspection and supervision of operations;
- prevention of interference with other activities in the marine
environment;
- transfer of rights and obligations by a contractor;
- procedures for transfer of technology to developing States in
accordance with article 144 and for their direct participation;
- mining standards and practices, including those relating to
operational safety, conservation of the resources and the protection
of the marine environment;
- definition of commercial production;
- qualification standards for applicants;
- financial matters:
- establishment of uniform and non-discriminatory costing and
accounting rules and the method of selection of auditors;
- apportionment of proceeds of operations;
- the incentives referred to in article 13 of this Annex;
- implementation of decisions taken pursuant to article 151, paragraph
10, and article 164, paragraph 2(d).
2. Rules, regulations and procedures on the following items shall fully
reflect the objective criteria set out below:
- Size of areas:
The Authority shall determine the appropriate size of areas for
exploration which may be up to twice as large as those for
exploitation in order to permit intensive exploration operations. The
size of area shall be calculated to satisfy the requirements of
article 8 of this Annex on reservation of areas as well as stated
production requirements consistent with article 151 in accordance
with the terms of the contract taking into account the state of the
art of technology then available for sea-bed mining and the relevant
physical characteristics of the areas. Areas shall be neither smaller
nor larger than are necessary to satisfy this objective.
- Duration of operations:
- Prospecting shall be without time-limit;
- Exploration should be of sufficient duration to permit a
thorough survey of the specific area, the design and construction of
mining equipment for the area and the design and construction of
small and medium-size processing plants for the purpose of testing
mining and processing systems;
- The duration of exploitation should be related to the economic
life of the mining project, taking into consideration such factors as
the depletion of the ore, the useful life of mining equipment and
processing facilities and commercial viability. Exploitation should
be of sufficient duration to permit commercial extraction of minerals
of the area and should include a reasonable time period for
construction of commercial-scale mining and processing systems,
during which period commercial production should not be required. The
total duration of exploitation, however, should also be short enough
to give the Authority an opportunity to amend the terms and
conditions of the plan of work at the time it considers renewal in
accordance with rules, regulations and procedures which it has
adopted subsequent to approving the plan of work.
- Performance requirements:
The Authority shall require that during the exploration stage
periodic expenditures be made by the operator which are reasonably
related to the size of the area covered by the plan of work and the
expenditures which would be expected of a bona fide operator who
intended to bring the area into commercial production within the
time-limits established by the Authority. The required expenditures
should not be established at a level which would discourage
prospective operators with less costly technology than is prevalently
in use. The Authority shall establish a maximum time interval, after
the exploration stage is completed and the exploitation stage begins,
to achieve commercial production. To determine this interval, the
Authority should take into consideration that construction of
large-scale mining and processing systems cannot be initiated until
after the termination of the exploration stage and the commencement
of the exploitation stage. Accordingly, the interval to bring an area
into commercial production should take into account the time
necessary for this construction after the completion of the
exploration stage and reasonable allowance should be made for
unavoidable delays in the construction schedule. Once commercial
production is achieved, the Authority shall within reasonable limits
and taking into consideration all relevant factors require the
operator to maintain commercial production throughout the period of
the plan of work.
- Categories of resources:
In determining the category of resources in respect of which a plan
of work may be approved, the Authority shall give emphasis inter alia
to the following characteristics:
- that certain resources require the use of similar mining methods;
and
- that some resources can be developed simultaneously without
undue interference between operators developing different resources
in the same area.
Nothing in this subparagraph shall preclude the Authority from
approving a plan of work with respect to more than one category of
resources in the same area to the same applicant.
- Renunciation of areas:
The operator shall have the right at any time to renounce without
penalty the whole or part of his rights in the area covered by a plan
of work.
- Protection of the marine environment:
Rules, regulations and procedures shall be drawn up in order to
secure effective protection of the marine environment from harmful
effects directly resulting from activities in the Area or from
shipboard processing immediately above a mine site of minerals
derived from that mine site, taking into account the extent to which
such harmful effects may directly result from drilling, dredging,
coring and excavation and from disposal, dumping and discharge into
the marine environment of sediment, wastes or other effluents.
- Commercial production:
Commercial production shall be deemed to have begun if an operator
engages in sustained large-scale recovery operations which yield a
quantity of materials sufficient to indicate clearly that the
principal purpose is large-scale production rather than production
intended for information gathering, analysis or the testing of
equipment or plant.
1. A contractor's rights under the contract may be suspended or terminated
only in the following cases:
- if, in spite of warnings by the Authority, the contractor has
conducted his activities in such a way as to result in serious,
persistent and wilful violations of the fundamental terms of the
contract, Part XI and the rules, regulations and procedures of the
Authority; or
- if the contractor has failed to comply with a final binding decision
of the dispute settlement body applicable to him.
2. In the case of any violation of the contract not covered by paragraph 1
(a) or in lieu of suspension or termination under paragraph l(a), the
Authority may impose upon the contractor monetary penalties proportionate
to the seriousness of the violation.
3. Except for emergency orders under article 162, paragraph 2(w), the
Authority may not execute a decision involving monetary penalties,
suspension or termination until the contractor has been accorded a
reasonable opportunity to exhaust the judicial remedies available to him
pursuant to Part XI, section 5.
Article 19
Revision of contract
1. When circumstances have arisen or are likely to arise which, in the
opinion of either party, would render the contract inequitable or make it
impracticable or impossible to achieve the objectives set out in the
contract or in Part XI, the parties shall enter into negotiations to revise
it accordingly.
2. Any contract entered into in accordance with article 153, paragraph 3,
may be revised only with the consent of the parties.
Article 20
Transfer of rights and obligations
The rights and obligations arising under a contract may be transferred only
with the consent of the Authority, and in accordance with its rules,
regulations and procedures. The Authority shall not unreasonably withhold
consent to the transfer if the proposed transferee is in all respects a
qualified applicant and assumes all of the obligations of the transferor
and if the transfer does not confer to the transferee a plan of work, the
approval of which would be forbidden by article 6, paragraph 3(c), of this
Annex.
1. The contract shall be governed by the terms of the contract, the rules,
regulations and procedures of the Authority, Part XI and other rules of
international law not incompatible with this Convention.
2. Any final decision rendered by a court or tribunal having jurisdiction
under this Convention relating to the rights and obligations of the
Authority and of the contractor shall be enforceable in the territory of
each State Party.
3. No State Party may impose conditions on a contractor that are
inconsistent with Part XI. However, the application by a State Party to
contractors sponsored by it, or to ships flying its flag, of environmental
or other laws and regulations more stringent than those in the rules,
regulations and procedures of the Authority adopted pursuant to article 17,
paragraph 2(f), of this Annex shall not be deemed inconsistent with Part
XI.
The contractor shall have responsibility or liability for any damage
arising out of wrongful acts in the conduct of its operations, account
being taken of contributory acts or omissions by the Authority. Similarly,
the Authority shall have responsibility or liability for any damage arising
out of wrongful acts in the exercise of its powers and functions, including
violations under article 168, paragraph 2, account being taken of
contributory acts or omissions by the contractor. Liability in every case
shall be for the actual amount of damage.
Previous
Convention on the Law of the Sea: Index
Parts:
I -
II -
III -
IV -
V -
VI -
VII -
VIII-IX -
X -
XI -
XII -
XIII -
XIV -
XV -
XVI -
XVII
Annexes:
I -
II -
III -
IV -
V -
VI -
VII -
VIII -
IX
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