LOST at Sea: Why America Should Reject the Law of the Sea Treaty
The Treaty’s ineffectiveness was exemplified by events in the South China Sea in September 2012. China deployed six surveillance ships in response to the Japanese government’s attempt to buy the disputed Senkaku islands (which the Chinese call the Daioyus) from their current owner, a wealthy Japanese family.20 Both countries are signatories to LOST, which was supposed to settle disputes over maritime boundaries by creating the International Tribunal for the Law of the Sea.
The Tribunal has so far largely failed to settle such disputes. The Senkaku/Daioyus dispute is not the first case brought before the Tribunal, whose approach seems to be to let countries talk among themselves until they reach a solution. The court established to settle disputes has repeatedly abdicated its responsibility, while continuing to claim jurisdiction. Frustration with this process has led at least one party to return to gunboat diplomacy. Despite filing a lawsuit with the Tribunal, China appears to be dissatisfied with a legalistic approach. China Ministry of Foreign Affairs Spokesperson Hong Lei stated, “Isn’t it a weird thing in international affairs to submit a sovereign country’s territory to international arbitration? What a chaos the world will be in if this happens?”21
Virtually all the cases thus far have involved impounding fishing vessels, but the Tribunal has not actually finally settled any serious international dispute; thus, regardless of the merits of the case, China’s frustration is not surprising. Where it has acted, the Tribunal has essentially told the parties to sort the issues out amongst themselves — as in the Southern Bluefin Tuna case examined below.
The Tribunal did decide one case, between Bangladesh and Myanmar, but that suit only arose due to confusion over the application of the Treaty in the first place, leading Eric Posner, the Kirkland and Ellis Professor of Law at the University of Chicago, and John Yoo, Professor of Law at the University of California Berkeley, to conclude:
“Early indicators suggest that the ITLOS will not be an effective international Tribunal... Because of the independence of the tribunal, states have little influence over how it resolves disputes. They cannot expect outcomes that are satisfactory to both parties, and thus they cannot expect widespread compliance. If compliance is likely to be weak, there is little point in using the Tribunal in the first place.”22
Another source of the Tribunal’s ineffectiveness arises from its very constitution. As Cato Institute Senior Fellow Doug Bandow points out:
“The new International Tribunal for the Law of the Sea is supposed to offer dispassionate adjudication of disputes. Yet membership is decided by quota: Each “geographical group” is to have at least three representatives. In its early days the Tribunal served as a dumping ground for frustrated LOST politicos such as Cameroon’s Paul Engo and Tanzania’s Joseph Warioba, both of whom once had hoped to become the Authority’s Secretary- General.”23
Ineffectiveness has an economic cost. States and companies will defer investment in disputed areas, as there is little hope for speedy resolution. Thus, as cases remain tied up in costly legal knots, areas become off-limits for development, and all economic benefit is lost.
There are also the costs from the redistribution of payments from the Authority to governments of developing countries. Many of these governments are less than savory, and traditional aid funds or revenues from existing natural resources are already being channeled into the pockets of the governing class and used to keep them in power. An additional revenue stream from the Authority would further cement their positions and worsen the condition of their peoples, further suppressing global growth. Add to this the aforementioned risk of allocating funds to separatist or terrorist organizations, which could turn the Authority into a backdoor source of funding for the arms trade. Thus, if the Authority works in the way it is constituted, it would represent a perverse cost to the poorest people in the world.
Can Resources Be Developed without LOST? The first argument — that LOST will advance the development of the seabed — is outlined in a letter from the U.S. Chamber of Commerce, sent to the U.S. Senate in July 2012:
“America’s extended continental shelf, which in some areas extends hundreds of miles beyond U.S. territorial waters, contains abundant oil and natural gas reserves that can provide reliable, affordable energy to America’s homes and factories for decades to come — but only if the Senate acts to approve Law of the Sea. Likewise, by joining the Convention, U.S. companies would gain exclusive access to abundant rare earth mineral resources that are essential to high-tech manufacturing. China currently controls 90 percent of the world supply of rare earth minerals. Law of the Sea represents America’s best opportunity to take control of its own resource destiny. No U.S. company will make the multi-billion- dollar investments required to recover these resources without the legal certainty the Convention provides.”30
This argument is demonstrably false. U.S. companies are already successfully investing in an area of the extended continental shelf — the “western gap” in the Gulf of Mexico.31 There are two areas of submerged continental shelf in the Gulf, outside the Exclusive Economic Zones of both the United States and Mexico, known as the Western Gap and the Eastern Gap. The Eastern Gap shares a nautical boundary with Cuba, and its precise boundaries have not been negotiated. The boundaries of the Western Gap, however, were defined by a treaty signed with Mexico in June 2000.
This bilateral treaty has allowed both nations to proceed with confidence in developing the extended continental shelf in the Western Gap. No objections have been raised to the bilateral treaty and none are expected. As a result, the U.S. Bureau of Ocean Energy Management has sold development rights in the Western Gap in several auctions since the treaty was ratified in 2001.
What of the Arctic? A 2011 Bloomberg BusinessWeek editorial argued:
“The U.S. continental shelf off Alaska extends more than 600 miles into the Arctic Ocean. American companies have been reluctant to invest in exploiting this underwater terrain, which contains vast untapped reserves of oil and natural gas. That’s because the U.S., as a nonparticipant in the sea convention, has no standing to defend its ownership of any treasures that are found there.”32
Yet this is exactly the same case as in the Gulf of Mexico. Only three nations contest the ownership of resources in the extended North American continental shelf in the Arctic: the United States, Canada and Russia. American relations with Canada are friendly; therefore, a United States-Mexico-style treaty with Canada demarcating appropriate lines north of Alaska should be relatively easy to achieve. Russia might be perceived as a more intractable problem; but a 1990 treaty between the United States and the Soviet Union defines the maritime boundary between the two powers.33
Under the Treaty, Russia has claimed vast areas beneath the Arctic Ocean, but these claims in no way infringe upon the 1990 Treaty. Actually, they are a challenge to Canada rather than the United States. South of the Arctic Ocean, the treaty line protects U.S. claims to large areas of extended continental shelf in the Bering Sea and in the Pacific Ocean southwest of the Alaskan Aleutian Islands. Accordingly, there is no barrier (barring the low one of a necessity to negotiate a treaty with Canada) to the United States developing the extended continental shelf in the Arctic and its environs in the same way it has in the Western Gap.
The problem of intellectual property protections was supposedly solved in the 1994 agreement, but it is vague, and the Authority’s latent powers remain to make it a continuing issue. Sponsoring states are still required to facilitate technology transfer “if the Enterprise or developing states are unable to obtain” the advanced equipment commercially. Thus, if a contractor develops a breakthrough mining technology, it will be compelled to sell it commercially to rivals or face the prospect of giving it away to the Enterprise (a direct competitor) and developing states. Neither of these options will be attractive to an entrepreneurial company, thereby further deterring investment in deep sea mining Research and Development. (Defense technology transfers are also a concern, but beyond the scope of this study.
Those who are concerned that the marine environment is being damaged by pollution could put their case before the Tribunal, but the obligations of Part XII would have a special effect on the United States, where citizens may sue to ensure the government follows its laws. Under the U.S. Constitution, international treaties have the force of law. Ratifying LOST would therefore enable environmental groups to sue to ensure the release of toxic substances is minimized “to the fullest possible extent” if there is a chance the material will enter the marine environment.
Consider: The nation’s coal-fired power plants release mercury into the atmosphere. Some of this mercury consolidates in rivers, and eventually reaches the ocean. As a result, fish that swim in the ocean have slightly higher levels of mercury in their systems. Sharks that eat these fish have even higher mercury concentrations. The concern that pregnant mothers who eat shark meat are damaging the cognitive development of their unborn children has led environmentalists to demand that the U.S. Environmental Protection Agency issue regulations to reduce the risk to unborn children.
However, consider what the Treaty text implies. There is no requirement to prove that the emissions actually cause significant harm. If the substance emitted is “harmful” to any degree, states are simply required to minimize emissions “to the fullest possible extent.” To all practical purposes, taking the Treaty at its word would require the closure of most if not all coal-fired electricity generation in the United States.
This kind of activism has not taken place in any of the other signatory states, likely because they offer fewer opportunities for concerned citizens to require their governments to follow the spirit and word of the Treaty. In the United States, however, environmental groups would probably sue the day after formal ratification, and the courts would be unlikely to throw out their challenges.
The Treaty would also significantly reduce the United States’ discretion in applying laws. America’s constitutional system gives its courts significant powers of judicial review. In the area of international rules on environmental pollution, however, accession to LOST would delegate those powers to the Tribunal or a similar court. That is the missed meaning of Article 213, on enforcement with respect to pollution from land-based sources:
“States shall enforce their laws and regulations adopted in accordance with article 207 and shall adopt laws and regulations and take other measures necessary to implement applicable international rules and standards established through competent international organizations or diplomatic conference to prevent, reduce and control pollution of the marine environment from land-based sources.”
As Christopher C. Horner, attorney and senior fellow with the Competitive Enterprise Institute, has noted, “That is a power grab not even the Kyoto Treaty dared attempt. The United States rejects Kyoto; why would we join Kyoto with a court?”46
It would therefore be disturbing to see precautionary thinking permeate the operation and application of the Treaty, given the potential effects on trade, innovation, and the economy at large. Yet that is precisely what has happened. In the Southern Bluefin Tuna Case (Australia and New Zealand v. Japan) on the over-fishing of Bluefin tuna, the Tribunal implicitly referred to the precautionary principle in its verdict, which generally instructed the parties to sort the matter out among themselves:
“Considering that, although the Tribunal cannot conclusively assess the scientific evidence presented by the parties, it finds that measures should be taken as a matter of urgency to preserve the rights of the parties and to avert further deterioration of the southern Bluefin tuna stock.”53
As Alana Rubin of the Michigan State University’s Animal Legal and Historical Center points out, this paragraph, “...further supported by paragraphs 77 and 79, refers to the scientific uncertainty regarding the stock of southern Bluefin tuna, and due to this uncertainty, conservation measures must be taken to prevent serious harm to the stock. In making its decision, the Tribunal noted that all parties agreed that the stock was at its lowest levels historically and that, therefore, Japan, Australia and New Zealand must implement conservation measures. In effect, the scientific evidence, even if ‘uncertain’ triggered the ITLOS’ [Tribunal’s] application of the precautionary principle. Thus, in making its decision to stop Japan’s actions, the ITLOS [Tribunal] applied the precautionary principle.”54