58 
agency of the United Nations, or, conceivably, some special purpose agency out- 
side the aegis of the United Nations. The purpose of the acquisition and distribu- 
tion of the revenues would be to make the regime acceptable; to buy out the inter- 
ests of nations in order to prevent them from breaking the regime.” The distribu- 
tion of revenues might follow any of several different patterns, meeting only the 
criterion of acceptability. One pattern that has a good deal of appeal is the devo- 
tion of the funds for the purpose of overcoming malnutrition. 
Aside from the questions about the establishment of an international agency, 
this regime raises questions about the determination of tax rates and their effect 
on production. Fees, such as license fees, to be paid prior to exploitation would be 
likely to deter initial efforts. Fixed taxes per area or per unit of output would 
not differentiate between high and low valued sites, unjustifiably rewarding one 
and penalizing the other. A tax on net income might avoid these difficulties, but 
there still remains the question of determining an appropriate rate. Negotiation 
of this rate would be fraught with difficulties and would provide no assurance 
that the entrepreneur would receive a fair return on his investment, or con- 
versely, that the public share would be appropriate. As in the allocation of ex- 
clusive rights, it would be desirable to avoid, insofar as possible, arbitrary 
decisions. 
D. An International Authority —The fourth alternative regime is an extension 
of the above; the chief difference being that it would establish a market for the 
exclusive rights to exploit the minerals of the deep sea. This regime would be 
analogous to that which governs the exploitation of the oil resources of the U.S. 
continental shelf. 
To achieve such a regime, the authority would have to acquire jurisdiction 
over the disposal of exclusive rights to the minerals resources of the deep sea 
floor. This jurisdiction must include the ability of the authority to extract rents, 
or royalties, through some form of market. It is suggested that the authority 
should not have the function of distributing the revenues received from the 
market. 
There is no necessity for the authority to operate under the aegis of the United 
Nations. Obviously, the United Nations does not have, at present, an agency that 
would be equipped to deal with such an authority, nor does it have the expertise 
that would be required for management. These problems do not, however, pre- 
elude the establishment of such an authority within the UN structure. If it is so 
established, it would be clearly desirable for the authority to have a high degree 
of autonomy (similar, perhaps, to that of the World Bank), so that it might 
operate without pressure from the General Assembly. 
The authority might be directed by a board with majority representation from 
the exploiting nations. These nations would be best equipped to provide the ex- 
pertise that is required and it would be in their self interest to provide rules 
that would permit efficient exploitation. The revenues received by the operation 
(above the costs of administration) should be turned over to another agency 
for distribution. The revenues might be distributed in any of several ways. At 
one extreme, they might be used for the general support of the UN (although 
this is not likely to be acceptable in view of the possible use for peace keeping 
forces). At another extreme, they might be returned to the exploiting nations 
(although this would defeat the purposes of the market). A more likely pos- 
sibility is that the revenues would be earmarked for some widely accepted goal, 
such as the overcoming of malnutrition. But in any case, the function of manage- 
ment should be separated from the function of revenue distribution. 
In its operation, the authority would follow the general principles that the 
U.S. Department of the Interior follows on the continental shelf. Markets would 
be held at certain intervals of time for certain areas of the sea floor (that might 
have been nominated by the entrepreneurs). Rights would be awarded on the 
basis of high bid. And the bid might be expressed as a certain percent of net 
income.” Certain rules might be invoked to ensure efficient operation, to ensure 
performance, and to prevent the abuse of the rights. But there would be no basis, 
outside of these rules, for vetoing an award to the high bidder. 
2To those (myself included) who hold the res communes theory, it might also be con- 
sidered as a justifiable payment to the “owners” of the resources. Or, to go a step further, 
it might be considered ethical and humanitarian for all peoples, but particularly those 
of the disadvantaged countries, to share in the wealth of the seas. 
30 Bids might be expressed in other ways as well—a bonus payment (such as that used 
on the U.S. continental shelf), as percent of gross income, as a payment per unit of out- 
put, ete. For an excellent discussion of these and other economic institutions that might 
be acceptable, see Brooks, “Deep Sea Manganese Nodules,” op. cit. 
