I hope we would not be expected to send the Navy out to try to protect these companies either under this bill or otherwise. I do not want to get into a war with other countries under this bill.

Mr. DOWNING. This bill does not contemplate that.

The bill protects a company against another domestic U.S. company.

Hopefully, other countries would enact similar legislation and then an international regime of sorts could be formed, if the Law of the Sea Conference reaches no agreement.

You have I have disagreed over this for many years, Mr. Fraser, and I do not suppose any long colloquy between you and me is going to settle the thing.

We do thank you for appearing.

Mr. FRASER. I appreciate the opportunity.

Mr. DOWNING. Any questions?

Mr. COHEN. Just one.

To follow up your line of questioning, we were able to achieve some concessions from other countries in terms of protecting our own fisheries resources, and I think, partially based upon the fact that there is such a movement or such a force within this committee to consider the 200-mile legislation, which I know you would be opposed to.

But, nevertheless, this did serve as some sort of catalyst to have some incentives made on behalf of protecting our own fishery stocks. And I wonder why you would reject that approach here?

Mr. FRASER. Well, Congress has often been used by the executive branch in international negotiations.

Mr. COHEN. The executive branch opposes the 200-mile limit.

Mr. FRASER. I understand that, but the executive branch can go to an international conference and say, "Look, we are under pressure from Congress," but I think that is different from actually passing a bill.

I think that is the crucial difference. If you go out and pass this bill, then it is no longer the executive branch saying if we do not get an agreement, then Congress will do this. When they see Congress moving ahead and enacting the legislation, the effect is harmfully unilateral. It then looks as though we are prepared to proceed

on our own.

There are not many countries that would look sympathetically on our mining companies who are so anxious to go ahead that they cannot wait a few more years. They would not understand that very well.

What I am saying is that I think Congress can play a role, but it should be in the form of a potential threat. I have seen this done repeatedly.

Mr. COHEN. I know you have done a great deal of work in the field of international relations, but some of the recent material we have been furnished-and I have one here just given to me by Mr. Shulberger, entitled "Subterranean Politics," which appeared in the Times and there seems to be a growing trend toward a nationalistic attitude protecting mineral resources and so forth.

Are you suggesting that if we hold off for this treaty, that we will somehow stem that tide?

Mr. FRASER. You mean if we hold off on this bill?

Mr. COHEN. Yes.

In other words, trying to accomplish this through negotiations, agreements, through a sharing of the world resources on a multinational basis simply rather than a nationalistic claim of 200 miles.

Mr. FRASER. Well, let me put it this way. There is a body of opinion in this country that looks askance at the whole effort to arrive at an international agreement, and the idea of an international regime in the sharing of the deep ocean resources. I think perhaps passage of this bill would look as though that body of opinion were the opinion of Congress as well. I am phrasing it this way because I do not necessarily impute that motive to members of Congress, but it may be read that way.

The United States is the strongest nation in the world-militarily and economically. It would be reaching out on its own and saying not worry about the rest of the world community because it is too weak and cannot do anything about it anyway. There would be a confirmation in the eyes of others-I do not mean in reality-that this was the course being followed by Congress.

Mr. COHEN. That is all I have to say.

Mr. DOWNING. Thank you very much, Mr. Fraser.

The next witness is Mr. John Norton Moore, Chairman, National Security Council, Interagency Task Force on Law of the Sea, and Deputy Special Representative of the President to the conference on the Law of the Sea.

Mr. Moore will be accompanied by the Honorable Howard Worthington, Deputy Assistant Secretary for Trade, Department of the Treasury; Mr. Pierce Elliott, Assistant Solicitor, International Law, Department of the Interior; the Honorable Howard W. Pollock, Deputy Administrator, National Oceanic and Atmospheric Administration, Department of Commerce; and Mr. Stuart P. French, Disrector, Law of the Sea Task Force, International Security Affairs, Department of Defense.

STATEMENT OF JOHN NORTON MOORE, CHAIRMAN, NATIONAL SECURITY COUNCIL, INTERAGENCY TASK FORCE ON LAW OF THE SEA, AND DEPUTY SPECIAL REPRESENTATIVE OF THE PRESIDENT FOR THE CONFERENCE ON THE LAW OF THE SEA, ACCOMPANIED BY HON. HOWARD WORTHINGTON, DEPUTY ASSISTANT SECRETARY FOR TRADE, DEPARTMENT OF THE TREASURY; PIERCE ELLIOTT, ASSISTANT SOLICITOR, INTERNATIONAL LAW, DEPARTMENT OF THE INTERIOR; HON. HOWARD W. POLLOCK, DEPUTY ADMINISTRATOR, NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION, DEPARTMENT OF COMMERCE; STUART P. FRENCH, DIRECTOR, LAW OF THE SEA TASK FORCE, INTERNATIONAL SECURITY AFFAIRS, DEPARTMENT OF

DEFENSE

Mr. MOORE. Thank you very much, Mr. Chairman.

It is a particular pleasure to again testify before this committee, first, because we are determined that the Law of the Sea negotiations

will have one of the closest working relations and liaison with Congress that we can possibly achieve. Second, because we greatly appreciate the assistance of you, Mr. Chairman, Congresswoman Sullivan, Congressman Pritchard, Congressman Fraser, and the other members of the Congress that have served on the U.S. Delegation to the Seabed Committee, and who will be continuing to give us good advice during the Caracas session of the Conference. And last, and not least, Mr. Chairman, because the chairman is a graduate of the university which is held in particularly high esteem by the person testifying.

Mr. DOWNING. You are getting to my soft side.

Mr. MOORE. Mr. Chairman, I welcome the opportunity to testify on H.R. 12233, the Deep Seabed Hard Minerals Act, and to discuss with this committee measures to encourage timely and efficient development of the mineral resources of the deep seabed. My testimony this morning has, in accordance with past practice, been coordinated through the NSC Interagency Task Force on the Law of the Sea and reflects the views of the executive branch. I am accompanied this morning by representatives of the Departments of Commerce, Interior, Treasury, and Defense.

The technology is now developing which will shortly permit commercial exploitation of manganese nodules on the deep ocean floor. This development will benefit not only those nations directly involved in mining or processing but also all nations as consumers of these minerals. Moreover, the generation of income for international community purposes as part of the common heritage can only be fulfilled if meaningful development occurs.

The United States has participated for the past several years in the preparatory work for the Third United Nations Conference on the Law of the Sea. It has done so in the belief that early development of deep seabed resources under an internationally agreed_regime would benefit the United States and all other nations. The substantive work of the Conference is now scheduled to begin on June 20 of this year in Caracas, Venezuela. We believe that timely international agreement on an effective regime for the development of deep seabed resources is the best way to assure the stable investment climate needed to encourage development, to ensure adequate protection of the marine environment, and to accommodate the interests of all nations. We are mindful, however, that for this approach to be successful in achieving our objectives, the international community must conclude timely agreement and one which will genuinely promote efficient development.

The General Assembly resolution convening the Third United Nations Conference on the Law of the Sea provides for completion of the work of the Conference in 1974 or 1975 at the latest. As we have previously testified in commenting on a predecessor bill, we would not view agreement as timely unless it were reached in accordance with this General Assembly schedule. Any delay after 1975 would deter the expected sequence of development. Accordingly, we agree with the underlying premise of the bill that by January 1, 1976 three must be an adequate legal regime for deep seabed mining under an internationally agreed regime in force on a provisional basis or, if this is not possible, then under appropriate legislation.

In either event, we will support appropriate legislation regarding the conduct of U.S. nationals and the role of Federal agencies. We are mindful in this regard that U.S. firms are making substantial investments in deep seabed mining and are rapidly approaching the point where they must make even greater investment decisions.

Similarly, for an international approach to be successful, the agreement must genuinely promote efficient development. We believe that such development will best be served by a legal regime which permits access to the resources of the deep seabed under reasonable conditions that will facilitate investment. For that reason, any machinery established could not have discretion to deny access to those resources or to alter the conditions upon which security of investment depends.

In previous testimony on this subject, we have underscored the importance that the United States attaches to protecting access to the mineral resources of the deep seabed. World events in recent months have heightened our awareness of the potential value to the United States and all nations of this source of important minerals. Within the context of the energy crisis, the international community has begun to understand how a shortage of critical supplies can jeopardize the economic growth and stability of all nations. Such shortages, through both their primary and secondary effects, impact harshly not only on industrialized countries but, in particular, on developing nations with scarce supplies of foreign exchange. Although the primary interest in the deep seabeds is in hard minerals rather than hydrocarbons, these recent events have reinforced the importance of a legal regime for deep seabed mining which would encourage sound development without introducing restrictions on access, price, or production levels. We hope that in the light of recent events, many countries will approach the international negotiations on the deep seabeds with a new circumspection.

It is against this background of the effort to obtain timely international agreement on a legal regime for efficient development of deep seabed mineral resources that we must assess H.R. 12233. This bill would authorize the Secretary of the Interior to issue licenses to persons subject to the jurisdiction of the United States for the exploration and commercial recovery of hard mineral resources on the surface of the deep seabed. Such licenses would authorize commercial recovery of hard mineral resources after January 1, 1976. However, after the act took effect, exploration would be permitted immediately upon issuance of a license. Licenses issued pursuant to the act would become subject to the provisions of an international agreement concerning the development of deep seabed minerals. which becomes binding on the United States. The proposed legislation also details certain terms and conditions to be included in licenses issued for deep seabed minerals development and authorizes the Secretary of the Interior, in consultation with other interested Federal agencies, to promulgate such additional rules and regulations as may be necessary to insure the orderly development of these resources under conditions which do not unduly damage the marine environment. Under the provisions of the bill, the U.S. Government would be required to compensate the holders of all licenses issued in accordance with the terms of the bill for certain losses or im

pairment of their investment resulting from new obligations placed upon them by an international convention to which the United States becomes a party.

On several occasions during 1973, the executive branch provided its view on H.R. 9, a bill similar in purpose to H.R.12233. Our opposition to the enactment of interim legislation for deep seabed minerals development at that time was based, in large part, on the assessment that such actions could seriously jeopardize our ability to achieve a timely and successful international agreement which would encourage development of deep seabed resources, as well as accommodate a variety of other important ocean uses. We have carefully reviewed this new version of the deep seabed interim legislation and take note of the constructive efforts that have been made to accommodate our previous difficulties with the interim approach. Among the improvements in the bill is that while it would establish a legal regime for granting exclusive rights to ocean miners, these rights would not apply to commercial recovery of deep seabed minerals prior to January 1, 1976. In addition, such licenses would be subject to the provisions of any international agreement accepted by the United States.

Nevertheless, we cannot support enactment of this bill for the following reasons.

We believe the enactment of this bill prior to the Caracas session of the Law of the Sea Conference would adversely affect progress on the deep seabeds as well as other aspects of the law of the sea negotiation. We will be in a better position to assess progress toward an international agreement after the Caracas session.

Our remaining reasons deal with the substance of the bill. First, we believe that issuance of any license prior to 1976 is unnecessary and undesirable in the absence of a determination that a timely and successful Conference is not possible. Second, the bill does not give the Secretary of the Interior sufficient flexibility to deal with the important contingency of provisional application of an internationally agreed regime applicable to all mineral resources of the deep seabeds. Third, we do not believe the U.S. Government should assume liability to private investors for the exercise of its normal treatymaking powers, and we cannot support the insurance provisions of the bill. Finally, we do not agree with all of the resource management provisions of the bill.

Let me elaborate on each of these points in turn.

With respect to the impact on the negotiations of enactment of the bill at this time, passage of legislation prior to Caracas would permit the opponents of a timely and successful Conference to focus the attention of the Conference on this legislation rather than on constructive efforts to reach international agreement.

Turning to the first substantive objection to the bill, that of licensing before 1976, I wish to reiterate that the United States remains firmly committed to the creation of an international legal order for the exploration and exploitation of the deep seabeds. While most of the provisions of the bill would not become effective prior to the scheduled conclusion of the Law of the Sea Conference, some nations might regard our enactment of a detailed resource management system as an attempt to preempt the international negotia