precedent. We prefer to await experience with the 

 recommended alternative of no competitive 

 bidding. 



(iv) Whether the claim sought to be registered 

 pertains to the intermediate zone, or to an area of 

 the deep seas beyond the intermediate zone, the 

 United States shall not require— as it does on the 

 outer continental shelf— that the business entity on 

 whose behalf a claim to exploit is registered pay to 

 it a fixed annual rent per acre or square mile or a 

 royalty on the value of production. But the United 

 States shall require such business entity to pay to 

 it the portion of the value of the extracted 

 minerals which the United States is obligated, 

 under the recommended framework, to pay to the 

 Registry Authority. In this way, the rights of the- 

 international community to the mineral resources 

 of the deep seas will be recognized without unduly 

 burdening American private enterprise. 



These payments to the Authority, which the 

 U.S. representative on the Authority will partici- 

 pate in fixing, may prove to be greater or less than 

 the rents and royalties paid on the outer conti- 

 nental shelf. In the intermediate zone, such dif- 

 ferences would probably be reflected in different 

 levels of competitive bidding. 



7. Equitable Distribution of Registered Claims 



The panel has considered the question whether 

 the "first come, first registered" principle, in the 

 light of aE the elements of the recommended 

 framework, may nevertheless work inequity 

 among nations. In answering this question, it should 

 be recalled that any State may register a claim 

 beyond the intermediate zone on behalf of any 

 business entity which may or may not be its 

 national. Under our recommendations, too, the 

 choice of a State Registrant by a prospective 

 explorer or exploiter is not likely to be determined 

 by the size of the "bonus" demanded for the 

 privilege of registration, for reasons earlier indi- 

 cated. Nor will the choice be influenced by the 

 competition of States to extend their "sover- 

 eignty" or "sovereign rights" over new areas, 

 because registration wiU have neither of these 

 consequences. Choice is likely to be influenced by 

 estimates of which State will offer, on the one 

 hand, the most effective protection to the explora- 

 tion and exploitation activities in question and, on 

 the other, the domestic laws making possible the 



most profitable operations. In some cases, these 

 two factors may lead in opposite directions. 



If experience with the recommended frame- 

 work should result in a distribution of registered 

 claims which is harmful to the interests of particu- 

 lar nations, the "first come, first registered" 

 principle may have to be modified or supple- 

 mented to achieve greater equity. This might be 

 accomplished by setting a limit on the number of 

 claims a State may register or by agreeing upon 

 some geographic distribution of claims which 

 might even go so far as to fix national or regional 

 quotas. These quotas would take into account 

 such factors as population; domestic production, 

 consumption and reserves of the mineral resource 

 in question; the quantities of the mineral resource 

 in question already extracted under claims regis- 

 tered by each State; and the quantities of the 

 mineral resource sold abroad by each State. 



8. Regional Cooperation 



The panel recommends that the United States 

 should encourage regional cooperation of States in 

 mineral resources exploration and exploitation in 

 order to promote regional economic stability and 

 cohesiveness and narrow the growing disparity 

 between United States technology and that of 

 other nations. Under the recommended frame- 

 work, States wishing to cooperate may form a 

 regional association of States and have the associa- 

 tion register the claims with the International 

 Registry Authority. 



9. Military Uses 



It may be helpful to clarify the relationship 

 between the recommended framework for the 

 exploration and exploitation of the mineral re- 

 sources of the bed of the deep seas and its subsoil 

 and the military uses thereof. At the outset, it 

 should be stated that the recommended frame- 

 work does not subject military uses to any control 

 or regulation; they will be governed by existing 

 principles of international law and any arms 

 control agreements that may be reached. 



Subject to such arms control agreements, mili- 

 tary uses may continue to be made of the bed of 

 the deep seas and its subsoil. If such a use was 

 intended to be covert and is uncovered in the 

 course of mineral resources exploration or exploi- 



Vlll-42 



