Royalty payments in UNCLOS are neither unique nor burdensome which is why the oil and gas industry views them as a bargain and favors UNCLOS ratification

If the words “United Nations” are a red flag to some, the concept of a foreign entity taxing a U.S. corporation is anathema. This is what some, including Senator Risch, see in UNCLOS. He argues that since 1776, the United States has never ceded its authority to tax anyone else.²⁹ As Secretary Clinton pointed out, UNCLOS is a royalty agreement related to drilling and extraction in areas beyond 200 nautical miles from a coast.³⁰ She has stated that U.S. companies already pay royalties to at least one commission—the Inter- national Telecommunication Union—so a precedent exists.³¹ U.S. oil and gas companies routinely pay royalties to foreign nations based on profits made from the materials pumped or extracted in these countries. Another leading isolationist, Senator James Inhofe of Oklahoma, argued that the royalties were taxes paid to a foreign entity. The Chairman of the Committee, Senator John Kerry, responded that President Reagan renegotiated this issue “with the oil companies and gas companies at the table” and they all agreed to the royalties. He also pointed out that the UNCLOS royalties were far less than the royalties paid in the Gulf of Mexico. Indeed, while certain isolationists may object to these royalties, those who would be paying them—the Exxons, Shells and Lockheed Martins—support UNCLOS. These companies realize that 93 percent of some profit is much better than 100 percent of nothing, as they are wary of drilling on the Continental Shelf since the United States has not ratified UNCLOS.