SUBSECTION E. THE ENTERPRISE SYSTEM
The Enterprise System
1. The Enterprise System shall be the operational part of the
2. Each Enterprise shall, within the framework of the
international legal personality of the Authority, have such legal capacity as is
provided for in the joint-venture agreement establishing each Enterprise. The
Enterprise system shall act in accordance with this Convention and the rules,
regulations and procedures of the Authority, as well as the general policies
established by the Assembly and shall be subject to the directives and control
of the Council.
3. Each State Party, desirous to participate in the Enterprise
System, shall designate an entity as a Signatory to the Enterprise System.
Signatories may be State enterprises or persons natural or juridical which
possess the nationality of States Parties or are effectively controlled by them
or their nationals, when designated by such States, or any group of the
foregoing, in accordance with the provisions of this Convention.
4. Any State Party, or group of States Parties, having designated
a Signatory, has the right to establish an Enterprise as a joint venture with
the Authority to carry out an approved project covering research and development
and/or exploration and/or production.
5. Each Enterprise should have at least one developing country as
a partner in the joint venture.
6. Each Enterprise is financed by the Authority and by the
Signatories in proportions to be determined by each Joint Venture Agreement.
(a) As a general rule, this proportion should
(b) For its part of the financing of an Enterprise, the Authority
shall initially seek the support of international funding and bilateral aid
agencies in accordance with their obligations under international law to assist
in the development and transfer of environmentally sustainable technology and
the conservation of biodiversity.
(c) Profits shall be shared between the Authority and the
Signatories in proportion to their investment.
6. Each Enterprise is governed by its own Joint-Venture Board.
(a) The Joint-Venture Board of an Enterprise shall
consist of 16 members.
(b) Eight of the members shall be designated by the Signatories,
and 8 shall be designated by the Council of the Authority, taking into account
the principle of equitable geographical representation, with due regard to the
interests of developing countries.
(c) The eight members designated by the Council of the Authority
may be designated to serve on more than one Joint-Venture Board.
(d) Each member of the Governing Board shall have one vote. Each
Signatory shall have a voting participation proportionate to his investment;
each member designated by the Council shall have a voting participation
equivalent to one-eighth of the Authority's investment.
7. Activities in the Area shall be carried out in accordance with
a plan of work and approved by the Council.
8. The Authority shall exercise such control over its Enterprises
as is necessary for the purpose of securing compliance with the relevant
provisions of this Part and the Annexes relating thereto, and the rules,
regulations and procedures of the Authority, and the plans of work approved in
accordance with paragraph 7. States Parties shall assist the Authority by taking
all measures necessary to ensure such compliance.
9. The Authority shall have the right to take at any time any
measures provided for under this Part to ensure compliance with its provisions
and the exercise of the functions of control and regulation assigned to it
thereunder or under any Joint-Venture agreement. The Authority shall have the
right to inspect all installations in the Area to ascertain compliance with
rules and regulations as well as reservation for exclusively peaceful purposes.
10. Joint-Venture agreements establishing an Enterprise for
Exploration and/or exploitation shall provide for security of tenure.
Accordingly, such agreements shall not be revised, suspended or terminated
without the consent of the Signatory or Signatories involved.
Inventions and technical
1. The Authority, in connection with any work performed by it or
on its behalf and in joint venture with it, shall acquire in inventions and
technical information those rights, but no more than those rights, which are
necessary in the common interests of the Authority and of the Signatories in
their capacity as such. In the case of work done under a joint-venture
agreement, any such rights obtained shall be on a nonexclusive basis.
2. For the purpose of paragraph 1, the Authority, taking into
account its principles and objectives and generally accepted industrial
practices, shall, in connection with such work involving a significant element
of study, research or development, ensure for itself:
(a) the right to have disclosed to it without payment
all inventions and technical information generated by such work;
(b) the right to disclose and to have disclosed to Parties and
Signatories and others within the jurisdiction of any Party such inventions and
technical information, and to use and to authorize and to have authorized
Parties and Signatories and such others to use such inventions and technical
information without payment.
3. The Authority shall also ensure for itself the right, on fair
and reasonable terms and conditions, to use and to have used inventions and
technical information directly utilized in the execution of work performed on
its behalf but not included in paragraph 2, to the extent that such use is
necessary for the reconstruction or modification of any product actually
delivered under an agreement co-financed by the Authority, and to the extent
that the person who has performed such work is entitled to grant such right.
4. The Council may in individual cases approve a deviation from
the policies described in 2 (b) and (3), where in the course of negotiation it
is demonstrated to the Council that failure to deviate would be detrimental to
the interests of the Authority.
5. With respect to inventions and technical information in which
rights are acquired by the Authority otherwise than pursuant to paragraph 2, the
Authority, to the extent that it has the right to do so, shall upon request:
(a) disclose or have disclosed such inventions and
technical information to any Party or Signatory subject to reimbursement of any
payment made by or required of the Authority in respect of the exercise of this
right of disclosure;
(b) make available to any Party or Signatory the right to disclose
or have disclosed to others within the jurisdiction of any Party and to use and
to authorize and have authorized such others to use such inventions and
(i) without payment in connection with any sea-bed
mining operation in conjunction therewith;
(ii) for any other purpose, on fair and reasonable terms and
conditions to be settled between Signatories or others within the jurisdiction
of any Party and the Authority or the owner of the inventions and technical
information or any other authorized entity or person having a property interest
therein, and subject to reimbursement of any payment made by or required of the
Authority in respect of the exercise of these rights.
6. The disclosure and use, and the terms and conditions of
disclosure and use, of all inventions and technical information in which the
Authority has acquired any rights shall be on a non-discriminatory basis with
respect to all Signatories and others within the jurisdiction of Parties.
7. Nothing in this article shall preclude the Authority, if
desirable, from entering into contracts with persons subject to domestic laws
and regulations relating to the disclosure of technical