The Prospect of a Fragmented Legal Regime of Mining of Seabed Mineral Resources in the Exclusive Economic Zone
By Digvijay Rewatkar
Published on 7 April 2025
Introduction
As the politics of climate change oscillates between its striking effects and denialism, the global energy, technological industry and minerals supply chains have been under a shift. For instance, the projected growth of AI datacentres, expansion of renewable energy projects and electric vehicles, and increasing defence applications, all portend towards a rise in the demand of minerals such as copper, nickel, cobalt, lithium, rare-earth elements etc. Inevitably, geopolitical competition is also sharpening for the access to minerals. Existing conflicts such as in Ukraine and DR Congo or the pending status of Greenland have all coalesced around mineral-related discourses. Whether one appreciates or not, the reality is that there is a discerning shift in how natural resources, particularly mineral resources are being perceived in the current global order.
In this regard, one such emerging source of minerals is the deep seabed in areas beyond national jurisdiction. As the International Seabed Authority (the ISA or the Authority) meets this year in March and July, it will attempt to complete the negotiations of the much-delayed ‘Exploitation Regulations’ to facilitate a rule-based mining order for deep seabed mineral resources. There exists much opposition to it, with 32 countries either calling for a precautionary pause or a moratorium or a complete ban owing to the negative environmental footprint of deep seabed mining especially considering the uncertainty of its effects in otherwise pristine environments. There has been a multi-year deadlock at the ISA which has already missed its 2-year deadline for the completion of the exploitation regulations for polymetallic nodules. Legally, speaking this now enables any contractor to submit an application [Section 1(15)(c), Annex, 1994 Implementation Agreement] for the approval of the plan of work, compelling the Council of the ISA to “consider and provisionally approve such plan of work based on the provisions of the Convention and any rules, regulations and procedures that the Council may have adopted provisionally, or on the basis of the norms contained in the Convention and the terms and principles contained in this Annex as well as the principle of non-discrimination among contractors.” Nauru Ocean Resources Inc. (or NORI) has expressed its intention to do submit its plan of work for approval in June 2025. Further, about Eight contractors have written a letter to the ISA Secretary-General calling for the timely completion of the exploitation regulations owing to their ‘legitimate expectations’, that their years of investment in exploration of deep seabed would translate into an exploitation regime at the end of their contract cycles for exploration.
Legal experts have weighed-in their views on different aspects of this issue, some suggesting that irrespective of the decision of the ISA on this approval for plan of work, there is likely to arise a dispute or a call for an advisory opinion. While other experts have questioned whether there exists a legitimate expectations on part of the Contractors to transition from exploration to exploitation. To much consternation amongst member states, and non-governmental stakeholders, the Metals Company in this regard, has upped the ante by announcing its intentions to apply for mining permit with the National Oceanic and Atmospheric Administration (NOAA) in the Area under the US Deep Sea Hard Minerals and Recovery Act, 1980.
However, as the negotiations on the exploitation of the deep seabed mineral resources in areas beyond national jurisdiction persists, there has been a concerted shift within States for exploring, with a view to exploiting, mineral resources within their Exclusive Economic Zone (EEZ). In the EEZ, coastal states exercise sovereign rights over the mineral resources i.e. national initiatives and laws determine the exploration and exploitation of mineral resources. This is manifested in the attempts by Norway to open an area within its EEZ and extended Continental Shelf; India opening blocks for offshore mineral mining in the Bay of Bengal; Japan considering mining off Minami-tori Shima; China entering into an agreement for exploration of seabed mineral resources in the EEZ of Cook Islands; the United States revoking the ban on mining in its continental shelf, or Kiribati ending its agreement with The Metals Company, and looking to make a deal with other foreign partners. As we reach this inflection point, it raises the question, as to what is the legal regime which governs the exploration and exploitation of mineral resources in the EEZ, and are there any links with the emerging exploitation regulations of the ISA? Further, in absence of the finalization of the exploitation regulations, what are the likely effects for states considering mining in their EEZ, and vice versa on the exploitation regulations?
What does the UNCLOS say about Mining in the EEZ?
The regime of the EEZ under Art. 56(1)(a) of the United Nations Convention on Law of the Sea (UNCLOS or the Convention) grants sovereign rights to the coastal state for the purpose of exploring and exploiting minerals resources on the seabed and its subsoil. However, it also calls for the due regard to the rights and duties of other states under Art. 56(2) of the Convention. At this stage, it is important to recognize that the EEZ is an extension of the economic interests of the coastal states, and does not reflect the ecosystem separation in the oceans. Consequently, while the coastal states enjoy sovereign rights over the mineral resources, the question arises with respect to the nature and scope of the obligations that coastal states owe to the other states. Art. 193 encapsulates such an obligation wherein states must exercise their sovereign rights in pursuance to their environmental policies and in accordance with their duty to protect and preserve the marine environment.
Art. 194 of the Convention mandates states to take all necessary measures to ensure that activities under their jurisdiction and control do not cause pollution beyond the areas where they exercise sovereign rights. States must minimize pollution from seabed exploration and exploitation to the fullest extent possible by regulating safety, design, construction, operation, and handling emergencies to prevent accidents, ensuring the protection of the marine environment. Linked to this obligation is the duty to cooperate [Art. 197] on a global and regional basis for the protection and preservation of the marine environment.
To this end, Art. 208 obliges the coastal states to adopt laws and regulations to prevent, reduce and control pollution of the marine environment from the seabed activities within their national jurisdiction, and take measures as may be necessary to prevent, reduce and control such pollution. Further, it lays the obligation that such laws, regulations and measures must be no less effective than international rules, standards and recommended practices and procedures [Art. 208(3)]. Finally, States acting especially through competent international organizations i.e. the ISA shall establish global and regional rules, standards and recommended practices and procedures to prevent, reduce and control pollution of the marine environment.
However, in absence of such global rules being established, the standards of protection and preservation of the marine environment will be varying across regions and states – leading to a fragmented regulatory landscape. Such a fragmented regulatory landscape while necessary to some degree owing to special regional characteristics, must not lead to ineffective protection and preservation of the marine environment.
Given the complexities and considerations involved in the exploration and exploitation of seabed mineral resources within the EEZ, the following question could be posed to address the nuanced legal and environmental aspects: “What are the specific obligations and standards of environmental protection that coastal states must adhere to when engaging in the mining of seabed mineral resources within their EEZ, and can these standards be harmonized with the emerging regulations of the International Seabed Authority (ISA) to ensure comprehensive marine environmental protection?”
Due diligence obligations of states involved in mineral activities
The 2011 Seabed Dispute Chamber Advisory Opinion on responsibilities and obligations of States sponsoring persons and entities with respect to activities in the Area (SDC Advisory Opinion), has articulated these obligations as best effort obligations. To fulfil these obligations, states must take measures within their legal system and that the measures taken must be “reasonably appropriate” [para 120, SDC Advisory Opinion]. However, due diligence obligations is a variable concept which could mean differently for different states. In the scenario where the ISA is unable to adopt the rules, regulations and procedures in a timely manner, there is a risk of fragmentation in the marine environmental protection, and pollution regime with differential standards existing for national jurisdiction and for areas beyond national jurisdiction or worse yet, there being no guidance on ‘global standards’.
However, independently of the ISA regulations, the due diligence obligations especially concerning the protection and preservation of the marine environment entail not only the adoption of appropriate rules and measures, but also a certain level of vigilance in their enforcement and the exercise of administrative control applicable to public and private operators [para 197, Pulp Mills Case]. In this respect, due diligence requires States to “ensure” that such activities within their jurisdiction or control do not cause significant adverse effects. This means that the states are required to develop a suite of regulations which concern not only the protection of the marine environment but, must also concern the monitoring, reporting, verification, enforcement and adjudication rules and regulations to ensure vigilance in the implementation of the national rules. It also requires taking into account the context and evolving standards of both regulation and technology [Guideline 3, ILC Draft Guidelines on the Protection of the Atmosphere].
The SDC further articulated the circumstances in which a state fails to meet its due diligence obligation: “A sponsoring State would not meet its obligation of due diligence if it disregarded risks [arising from scientific uncertainty]. Such disregard would amount to a failure to comply with [the due diligence obligation] [para 131, SDC AO]. Therefore, a state must continuously manage its compliance with this due diligence obligation, and account for emerging risks to fulfil its obligations. The continuous and evolutionary nature of due diligence obligation has also been a subject of discussion elsewhere. The International Law Commission has understood the duty of due diligence as not intending to guarantee a [certain outcome] such as no environmental harm [ILC Work on Transboundary Harm, p. 154, para 7-8]. The standard of due diligence against which the conduct of the State of origin should be examined is that which is generally considered to be appropriate and proportional to the degree of risk [Art. 7, ILC Draft Articles on Law of the Non-Navigational Uses of International Watercourses]. Therefore, “[t]he State may be responsible […] for not enacting necessary legislation, for not enforcing its laws […], or for not preventing or terminating an illegal activity, or for not punishing the person responsible for it”.
In the least, what is expected of states is to have a functional legal and regulatory system for the governance of activities in their EEZ. This due diligence obligation requires deploying adequate means, making best efforts, and doing the utmost to achieve this result. In international law terms, it is an obligation “of conduct” rather than “of result”. As per Art. 208(3) of the Convention what remains amiss are the international standards against which such national laws could be benchmarked. It is now more urgent that ever for the ISA to complete these regulations lest seabed minerals activities proceed without global standards – causing the risk of pollution or harm to the marine environment.
We have arrived at an inflection point in the governance of mineral resources in the deep seabed. It is critical to either establish an international regulatory system for managing these resources – including licensing, monitoring, enforcement, and adjudication – or risk fragmentation across different jurisdictions with less effective rules and regulations, which could undermine environmental protection. This also raises the prospect of a stillborn deep seabed mining industry but, an evolving seabed minerals industry within national jurisdiction, and it must make the opposition to deep seabed mining in the Area consider if such a pyrrhic victory is worth winning.
Digvijay Rewatkar is a Research Associate with the Ocean Law and Policy Team at the Centre for International Law at National University of Singapore. The views expressed here are of the author, and do not reflect the view of his affiliations.