Untouchable metals: How the obligations of UNCLOS States Parties limit the commercial viability of unilateral deep sea mining

Reflecting an extraordinary and unprecedented act of multilateralism, Part XI of the UN Convention on the Law of the Sea (‘UNCLOS’) protects the mineral resources of the seabed beyond national jurisdiction (‘the Area’) from a global free-for-all. It declares the Area and its resources as “the common heritage of [hu]mankind” (‘CHM’) and provides that the resources can only be exploited with the approval of the International Seabed Authority (‘the Authority’), and in accordance with the Authority’s rules, regulations and procedures.

UNCLOS is widely but not universally ratified (169 ratifications). Significant coastal states that are non-States Parties (‘NSPs’) include Turkey, Venezuela, Peru, Israel and the United States. On 24 April 2025, the White House issued an Executive Order expediting a domestic process unilaterally to authorise the exploitation of resources in the Area under the Deep Seabed Hard Mineral Resources Act (‘DSHMRA’), without reference to the Authority and without observing the CHM principle. Five days later, on 29 April 2025, The Metals Company USA LLC (‘TMC USA’) – the US subsidiary of a Canadian parent company The Metals Company (‘TMC’) – applied for a commercial recovery permit under DSHMRA.

This blog has already considered whether the US, as a NSP to UNCLOS, is entitled, under international law, unilaterally to authorise the exploitation of mineral resources of the Area. As explained in an excellent post by Coalter Lathrop, that seems unlikely because: i) the US is a signatory to the 1994 Agreement (an implementing agreement to UNCLOS which amended Part XI) and is bound not to take steps that defeat the object and purpose of that treaty; ii) the CHM principle has likely crystallised into a customary rule; and iii) the US has not been a persistent objector to the formation of that customary rule.

In this article, we look beyond the question of whether the Executive Order heralds an impending violation of international law or the lawful exercise of sovereign rights by a NSP to UNCLOS. In practical terms, the response of UNCLOS States Parties (‘SPs’) should be the same. That is, the obligations on SPs under Articles 137-139 UNCLOS have a similar effect to the customary obligation not to aid or assist an internationally wrongful act as codified in Article 16 of the Articles on the Responsibility of States for Internationally Wrongful Acts (‘ARSIWA’). Moreover, they apply irrespective of whether the unilateral activity is internationally wrongful. In short, provided that US unilateralism is not system-breaking and SPs perform their obligations diligently, it is difficult to see how unilateral exploitation activities under DSHMRA could be commercially viable.

Article 137 UNCLOS

Article 137 UNCLOS is critical to the practical implementation of the CHM principle and provides potentially far-reaching obligations for SPs. Article 137(1) provides:

“No State shall claim or exercise sovereignty or sovereign rights over any part of the Area or its resources, nor shall any State or natural or juridical person appropriate any part thereof. No such claim or exercise of sovereignty or sovereign rights nor such appropriation shall be recognized.”

Article 137(3) provides:

“No State or natural or juridical person shall claim, acquire or exercise rights with respect to the minerals recovered from the Area except in accordance with this Part. Otherwise, no such claim, acquisition or exercise of such rights shall be recognized.”

These provisions are unusual. As noted by Joanna Dingwall in her monograph on International Law and Corporate Actors in Deep Sea Mining, they are framed in a manner which appears to impose obligations on SPs and NSPs and on SP nationals and corporations and NSP nationals and corporations. It is strongly arguable that that is a necessary corollary of the CHM principle and the rejection of all claims to sovereignty or sovereign rights over the Area.

Whether or not Article 137 has the broad effect suggested by Dingwall, it certainly requires SPs not to recognise: (i) any claim to sovereignty or sovereign rights over the Area indicated by unilateral exploitation activity; and (ii) any claim to, acquisition, or exercise of rights over the minerals recovered from the Area in unilateral exploitation activity. In practical terms, Article 137(1) means that SPs are prohibited from participating in operations under a DSHMRA permit because to do so would “recognise” as valid the claim or exercise of sovereignty or sovereign rights over the Area. Article 137(3) means that SPs must not receive, process, refine, purchase or otherwise acquire or deal with any minerals recovered from the Area through operations under a DSHMRA permit, because to do so would “recognise” as valid the claim to, acquisition, or exercise of rights over those minerals.

Those obligations bind the organs of the state and other persons or entities exercising governmental authority: see Articles 4 and 5 of ARSIWA. But what about private actors within the jurisdiction of SPs? Are they also prohibited from “recognising” the actions identified in Article 137(1) and (3)? We suggest that the unqualified language in those provisions (‘no such claim… shall be recognized’) implies an obligation on SPs to put in place legislative or administrative measures to ensure that private actors within their jurisdiction do not “recognise” those actions. Any alternative interpretation that excludes private actors from the scope of these provisions would render them ineffective and undermine the CHM principle that is the foundation of Part XI.

Articles 138 and 139 UNCLOS

Article 138 UNCLOS requires the general conduct of SPs in relation to the Area to be in accordance with Part XI and other rules of international law.

Article 139(1) UNCLOS complements Articles 137 and 138. It provides:

“[SPs] shall have the responsibility to ensure that activities in the Area, whether carried out by States Parties, or state enterprises or natural or juridical persons which possess the nationality of States Parties or are effectively controlled by them or their nationals, shall be carried out in conformity with [Part XI]…”

Article 139(1) is most obviously applicable to the obligations of sponsoring states as regards the activities of their sponsored contractors. That is the context in which the Seabed Disputes Chamber, in its 2011 Advisory Opinion, found that this provision imposed a “due diligence” standard, requiring the adoption of appropriate legislative and administrative measures and a certain level of vigilance in their enforcement. But the text of Article 139(1) does not limit its application to the sponsorship relationship. A responsibility to ensure that activities in the Area are carried out in conformity with Part XI necessarily implies a concomitant responsibility to ensure that activities in the Area are not carried out in a manner that is not in conformity with Part XI. This obligation is likely of an erga omnes character by virtue of the shared interest of all humankind in the responsible use and protection of the Area under the CHM principle (see para 180 of the SDC’s 2011 Advisory Opinion). Article 139(1) thus applies not only to SPs’ sponsored contractors, but also to those “natural or juridical persons which possess the nationality of [SPs]” or “are effectively controlled by… their nationals.”

Practical consequences

Accordingly, when read together, we suggest that UNCLOS Articles 137-139 require the following:

First, SPs must take reasonable steps to ensure that they, the corporations under their jurisdiction and their nationals do not participate in unilateral operations carried out under a DSHMRA permit either directly, or indirectly by – for example – contributing necessary and material elements of such an operation such as environmental, engineering and design services, vessels, equipment, bunkering and supplies. Specifically, as regards TMC-USA’s pending application for a DSHMRA permit, that means that:

• Canada must consider the position as regards TMC, the Canadian parent company of TMC-USA, Nauru must consider the position as regards Nauru Ocean Resources Inc (‘NORI’), the Nauru-domiciled subsidiary of TMC, and Tonga must consider the position as regards Tonga Offshore Mining Ltd (‘TOML’), the Tonga-domiciled subsidiary of TMC. In particular, each SP must ascertain whether TMC or NORI or TOML is functionally independent from TMC-USA such that it does not, for example, share critical data, designs, personnel etc which enable TMC-USA to carry out unilateral activities in the Area. If there is no functional independence, the SP must take reasonable steps to prevent the company over which it has jurisdiction from participating in activities in the Area that are not in conformity with Part XI.

• Australia and New Zealand must consider the position as regards the consultancy services provided to TMC by their state agencies (Australia’s CSIRO and New Zealand’s NIWA). In particular, they must be satisfied that their services will not indirectly support TMC-USA’s application under DSHMRA, or its intended unilateral activity in the Area.

• Switzerland must consider the position as regards AllSeas, the Swiss owner and operator of the vessel Hidden Gem, used by TMC for its exploration activities. Switzerland must take reasonable steps to ensure that AllSeas does not make Hidden Gem available to TMC-USA for activities in the Area that are not in conformity with Part XI.

• Malta must consider the position as regards Hidden Gem, the Maltese flagged vessel owned and operated by AllSeas, and used by TMC for its exploration activities. Malta must take reasonable steps to ensure that Hidden Gem is not used as part of any activities in the Area that are not in conformity with Part XI.

• The Republic of Korea must consider the position as regards Korea Zinc, the Korean investor in TMC, to ascertain whether its recent investment of $85m is, as reported, intended to benefit TMC-USA’s unilateral activities. If that is the case, the Republic of Korea must take reasonable steps to prevent Korea Zinc from financing activities in the Area that are not in conformity with Part XI.

Second, Articles 137-139 require SPs to take reasonable steps to ensure that they, the corporations under their jurisdiction, and their nationals do not acquire, receive, or deal with minerals recovered through unilateral activity in the Area, or otherwise benefit from the unilateral recovery of such minerals. Specifically, as regards TMC-USA’s pending application for a DSHMRA permit, that means:

• Japan must consider the position as regards Pacific Metals Co. Ltd (PAMCO), the Japanese metallurgical company which has processed nodules collected by NORI (pursuant to a 2023 MoU). Japan must ensure that PAMCO does not receive the minerals recovered by TMC-USA for processing under any current or future MoUs.

• All SPs need to consider taking legislative or administrative steps to i) prevent the importation of minerals that derive from unilateral activity in the Area or products containing such minerals; and ii) control the proceeds of transactions involving the minerals that derive from unilateral activity in the Area.

Potential criminal consequences

Some SPs already criminalise the participation of their nationals in unilateral activities in the Area (see e.g. section 1 of the UK’s Deep Sea Mining Act 1981; section 8 of New Zealand’s United Nations Law of the Sea Convention Act 1996; article 44 of Japan’s Act on Interim Measures for Deep Seabed Mining).For those SPs, money laundering legislation may already (in certain circumstances) treat the proceeds of such transactions as the proceeds of crime. Other SPs may be required to amend their domestic legislation to achieve the same effect.

Conclusion

The upshot is that, even if the US is not prohibited under international law from carrying out unilateral exploitation activity in the Area, the obligations of SPs under Articles 137-139 UNCLOS may well mean that any such US activity must be financed, resourced, and supported exclusively by NSP-nationals, NSP-domiciled companies, and NSP-flagged vessels, and the minerals extracted unilaterally from the Area may only be processed, refined, used and sold within NSP economies. That is not a wildly attractive proposition for investors, particularly when – at least in some SP jurisdictions – the proceeds of activity under a DSHMRA permit risk being treated as the proceeds of crime, giving rise to the risk of money laundering offences.

All of this depends, of course, on US unilateralism not being system-breaking and on the determination of SPs to defend the CHM principle through proactively upholding and diligently performing their UNCLOS obligations.