The legal aspects of the development of the Northern sea route and North-­Western passage, like a new Arctic marine transportation system

The research of the USA National Center for the monitoring of the state of the snow and ice of the Northern Arctic Ocean are conducted since 1979. In 2007 was firstly registered the ice conditions, which allows to open two sea passages --‐ Northern Sea Route (NSP) and the North--‐ West Passage (NWS) for the summer season. 2007 was a record year for the reduction in the area of the polar cap in the Arctic Ocean, from that moment cease to form multi--‐year ice pack. Again, in August 2011, and the ice cover in the northern hemisphere was close to a record minimum in the whole history of its monitoring.

Such severe and rapid climatic change can not leave the international community indiffer--‐ ent to this situation. Moreover, this situation encourages Canada and Russia as Arctic powers to act decisively to the development of alternative transport route through the world of NSPs and NWP along the Russian and Canadian coasts, respectively.

From one side, NSP server and NWP through the Arctic Ocean opens up new opportunities for the international trade, 90% of which are carried by sea1, on the other side, the navigation in the Arctic waters has great risks.

Alternatice route compared t with the traditional scheme of the transporting goods from Europe to Asia and from the North America to Europe will shortern the distance for about 40 %2. Accordingly, reducing the amount of the spent fuel and with it the amount of CO2 emissions. With further development of the nuclear icebreaker fleet construction technology will be safer and less expensive. Finally, NSP and NWP safer in terms of the piracy and political instability in the Middle East, the northern and eastern African coast. Thus, the navigation on the NSR and NWP will be more cost--‐effective compared with overloaded Suez and Panama canals.

Intensive commercial shipping is equally interested in both Arctic coastal states and those countries that do not have direct access to the Arctic Ocean. First of all, it is the Asia--‐Pacific region, such as China, Japan, South Korea and India.

However, the question was who will manage and control resources in NSPs and NWP, and who will be responsible for the risks faced by Arctic sea shipping--‐agency? In other words, what the legal regime applicable to the NSPs and NWP? Which scenario will control navigation in the Arctic Ocean? Who will take a part in the development of commercial navigation on the NSR and NWP?

North--‐Western Passage

NSP and NWP extend along the Arctic coast of the North America from the Davis Strait in Baffin Bay to the east and to the Bering Bay in the west3. It is a system of seven Straits, of which only five are suitable for the navigation of large vessels.

In 1969 the USA oil tanker USA SS Manhattan became as the first commercial vessel which passed from Philadelphia (East Coast) through to Alaska and back. However, with the U.S. did not ask for permission from Canadian authoritie NWP to the vessel's transit and came back. A similar incident occurred in 1985 in USA. Coast Guard icebreaker USCGC Polar Sea proceeded from Green--‐ land to Alaska through the NWP without notice.

These two incidents have caused a lot of debate in the government of Canada about the national sovereignty over the waters of the Arctic Archipelago. Canada's first official position on the legal regime of NWP was made in 1975 by the Secretary of foreign policy by Alan Mc Ehenom.

In his speech he said that the waters adjacent to the Arctic Archipelago are internal waters of Can--‐ ada, and the regime of transit passage through the SMP can not be applied. Further, by imple--‐ menting regulations into the national legislation and the government began to form a more strin--‐ gent regime of navigation in the waters of the Canadian Arctic Archipelago, and accordingly, and create a legal framework to support national sovereignty.

Ice wiring of the American tanker SS Manhattan was a prerequisite of the Act on the Pre--‐ vention of Pollution of the Arctic waters, which was published in 1970. It first gives the definition of the "arctic waters" of Canada, and describes the geographical area of the action to ban disposal of any origin in this area 4. In 1972 issued a decree on Shipping safety control zones, according to which set of 16 special zones with the relevant requirements of the board, their class and charac--‐ teristics 5. At the same time were created several provisions of the Prevention of Pollution of the Arctic shipping by which introduced a set of controls, which are set by the prohibition on the dis--‐ charge of oil or petroleum substances 6. In 1977 was introduced a system of voluntary notification of the vessel positions (Nordregio). Since 2010 it becomes mandatory, especially when during the navigating in NWP.

It is worth noting that at the same time, Canada is actively involved in the negotiations on the UN Convention on the International Law of the Sea, which was adopted in 1982. That Canada initiated and promoted the introduction of the 1982 Convention of the Special regime in the areas covered by ice, which has been successfully entered into Article 234 7.

Coastal States have the right to adopt and enforce non--‐discriminatory laws and regulations for the prevention, reduction and control of marine pollution from vessels in ice--‐covered areas within the exclusive economic zone, where particularly severe climatic conditions and the pres--‐ ence of ice covering such areas for most of the year create obstructions or exceptional hazards to Navigation and pollution of the marine environment could cause major harm to the ecological bal--‐ ance or irreversible disturbance. Such laws and regulations shall have due regard to navigation and the protection and preservation of the marine environment based on the best scientific evidence8.

After the incident with the icebreaker USCGC Polar Sea additionally receives Canada in 1985 Regulations for the Prevention of Pollution of the Arctic waters, and sets straight baselines around the Canadian Arctic Archipelago9.

In 1996, the Act comes into theforce on the oceans, in which Canada is expanding its juris--‐ diction over marine areas10. In accordance with the UN Convention on the Law of the Sea in 1982, the territorial sea extends to 12 miles, contiguous zone --‐ up to 24 miles, the EEZ --‐ up to 200 miles, including the 200--‐mile zone of the continental shelf, and the begin--‐ning of the straight baselines established around Arctic Archipelago.

In 2003, Canada ratified the UN Convention on the Law of the Sea 1982. However, Canada has reserved the right not to consider solutions to disputes related to the interpretation or appli--‐ cation of articles 15, 74 and 83 required. Specifically, these articles include provisions concerning the delimitation of maritime boundaries, exclusive economic zones, historic bays or titles11.

All of the above regulations perpetuate the status surrounding waters of the Arctic Archi--‐ pelago, both internal to the national legislation. However, the United States, European Union, in particular Denmark, do not recognize these documents. Particularly critical in these States is the establishment of direct baseline, not normal baselines ¹² of the low water level along the coast, from which the breadth of the territorial sea is measured. Accordingly, the zone is significantly ex--‐ panded. According to the United States, does not observe the terms of Articles 7.1¹³ and 7.3¹⁴ of the 1982 Convention. As the United States does not recognize the sovereignty of Canada over the EWS, including its international strait. However, in 1988, Canada and the United States signed a bilateral agreement on cooperation in the Arctic, but the legal status of the waters of NWP does not fix it.

Nothing in this agreement on cooperation between the neighbors and friends of the Arctic, no action within it does not affect the position of the Government of Canada and the U.S. on mari--‐ time law in this or other sea areas, no matter their position in relation to third parties, respective--‐ ly¹⁵ .

After the Russian expedition "Arctic 2007" to the bottom of the Arctic Ocean, Canada ac--‐ tively starts to develop and implement a national strategy for the development of its northern Arc--‐ tic regions, as well as strengthening its sovereignty. In other words, Canada expands its presence in the Arctic in different industries on the basis of «use it or lose it» («use it or lose it"), which Prime Minister Stephen Harper called the chief in matters of sovereignty in the Arctic.16.

The Northern Sea Passage way

SMP is located in the inland sea waters, territorial sea (territorial waters) or in the econom--‐ ic zone of the USSR (Russia), adjacent to the northern coast of the USSR (Russia), its national transport links, including the fit to the climbing route of ships, the extreme points of which are bounded on the west by Western entrances to the Novaya Zemlya straits and meridian, which runs north from Cape Desire, and in the east of the Bering Strait parallel 66 ° north latitude and the meridian of longitude 168 ° 58'37 "west longitude17.

Navigating the NSR has been practiced for over 75 years. Arctic con--‐warriors of the Second World War was the first experience that opens the geostrategic importance of Arctic shipping. Transport activity in the sea along the NSR reached its peak in the 1980s. At the same time, the president of the USSR Mikhail Gorbachev proposed Murmansk Initiative, in which he laid the first stone of the international shipping along the Rus--‐sian Arctic coast. He proposed to open NSR navi--‐ gation by foreign ships supported by Soviet (at the time) icebreakers. However, the collapse of the Soviet Union, led to a significant stagnation of the economy, and the industry as a sea navigation is no exception.

However, current trends in the Arctic geopolitics suggest opening the NSR for the foreign ships and expand the navigation season due to the activation of the Russian icebreaker fleet and climatic changes. At the moment, nuclear fleet includes six icebreakers. In August 2011, Security Council Secretary Nikolai Patrushev announced the government's plans: up to 2015 in Russia will build four icebreakers, including universal icebreaker and three linear diesel icebreakers 18.

In August 2010, the Russian authorities have given permission for the first time on the ice channeling foreign cargo ship from Norway through Russian waters in China for the transportation of iron ore concentrate (bulker Nordic Barents, DWT --‐ 43.731 tons, cargo --‐ 41.000 tons of eco--‐fuel nomiya of approximately USD 180,000) 19. In the summer of 2011 the tanker STI Heritage (DWT --‐ 73,799 tons, cargo --‐ 61.000 tons) carrying condensate from Vitino port in China, set a record for the passage of the NSR for eight days at a speed of 14 knots20. Opening of the office of infor--‐ mation support navigation on the NSR in Kirkenes (Norway), the joint program "Rosatomflota" and the Norwegian High North Logistics Center demonstrates the desire and need for the commercial use of the Arctic waters.

Now operates the following system of the normative documents that establish the legal status of NSP:

• 4-    1971 --‐ Regulations about the Administration of the Northern Sea Route;

• 4-    1990 --‐ Rules about the traces along the Northern Sea Route;

• 4-    1996 --‐ Terms of the icebreaking pilotage through the Northeast Passage;

• 4-    1996 --‐ Requirements for the construction, equipment, and supply ships sailing the North--‐ ern Sea Route;

• 4-    1998 --‐ FZ "On the internal waters, territorial sea and contiguous zone of the Russian Feder--‐ ation";

• 4-    2011 --‐ Order of the FCS "On the establishment of tariffs for the icebreakers along the Northern Sea Route".

Thus, all the shipping, carried out by NSPs along the Russian coast of the governed, is first of all regulated by the Russian legislation in accordance with the international maritime law.

In 1997, Russia ratified the convention of the United Nations in 1982 with the same excep--‐ tions that took Canada to the provisions of Articles 15, 74 and 83. According to the Federal Law "On ratification of the UN Convention on the Law of the Sea," Russia is not provided for in section 2 of Part XV of the Convention procedures leading to binding on the parties to disputes relating to the delimitation of maritime boundaries, exclusive economic zones, historic bays or titles21.

In 2001 he published the Naval Doctrine of the Russian Federation for the period up to 2020, which sets long--‐term objectives for the economic development through the establishment of the Arctic marine infrastructure for the NSR. First of all it is about establishing a centralized gov--‐ ernment transport system, icebreaking services. Second, the need to provide equal access to in--‐ terested carriers. And third, it is essential to develop the shipbuilding industry, based on the ship--‐ ping in ice conditions, as well as updating and safe operation of the nuclear icebreaker fleet, and so on22.

Transport Strategy of Russia for the period up to 2020, adopted in 2005, aims at the devel--‐ opment and reform of the maritime transport. As for NSPs, the Eurasian transport corridor as it will stimulate the market for the transport services.

In 2007, a scientific expedition "Arctic 2007" was held, which is primarily for Russia has be--‐ come a new landmark in the Arctic policy issues, a key component of which is the infrastructural development of the NWP. The expedition was one of the impulses for the Russian government to follow a strategy of the economic development in the regions of the Far North.

In 2008, was issued the document "Principles of the State Policy of the Russian Federation in the Arctic for the period up to 2020 and beyond". In general, the document reiterates and rein--‐ forces the position of the maritime and the transport doctrines regarding the NWP, including items on the establishment and the development of the marine and coastal infrastructure, and to ensure the restructuring of the domestic freight volumes on the NWP.

Also, in 2012, the project is expected Fz "About the Arctic zone of the Russian Federation", which will make the northern territories, as an "independent object of the public policy" in the so--‐ cio--‐economic development.

On the world stage, Canada and Russia have positioned themselves as the two largest Arc--‐ tic Powers. For both countries, it is important to take an opportunity to demonstrate their sover--‐ eign rights over geostragic important region. All steps towards the recognition of the national sov--‐ ereignty over NWP and NSPs, as part of this.

Analyzing the legal regime of the two Arctic highways, it is important to define the state--‐ ment "sovereignty" and the reasons for its establishment.

Sovereignty – is a set of the rights such as autonomy and the independence of the State in the implementation of the foreign policy, the state's participation in the international treaties cod--‐ ifying the international law or the critical regulatory relationship between two or more States. Sovereignty includes the concept of the legal personality that is normative and legal authority of the state: the sovereignty extends to the territory of the state, as well as territorial waters, seabed and subsoil and is limited by the national boundaries 23.

As the part of the public international law, there are several key factors that form the basis for the establishment of the state sovereignty: a long period, the order to seize territory, sources of legal basis, effective occupation, effective and long--‐term demonstration of the state power, a manifestation of the sovereignty, and the geographical and historical reasons, etc 24.

Sovereignty issues have always been complicated. Their solution requires different princi--‐ ples of international law, taking into account the specifics of each situation.

First, the positions of Russia and Canada based on the doctrine of the historic waters. First ice channeling foreign ship on NWPs held in only 2010 (the Danish bulk carrier Nordic Barents). In the history of the development of NWP from 1906 to 2005, the foreign vessels were committed only 69 total passes. All of them were carried out with the permission of the Canadian government with the exception of incidents Polar Sea and Manhattan25. These low figures for such a long time are not sufficient to confer the status of the SPM and NWP are vital for the international naviga--‐ tion, with its modern system of routes.

Second, the application of the domestic law in relation to the vessels engaged in the trans--‐ portation NWP and NSPs for nearly 30 years, is a sufficient manifestation of the government au--‐ thority to establish the national sovereignty.

Canada and Russia as the two Arctic powers have similar geographical conditions. The Arc--‐ tic regions of the two states in its vast territory and rich in energy and the transport capacity. For both countries, issues of the internationalization of NWPs and NSP and the national sovereignty are a key strategy in the Arctic.

It should be noted that none of the countries does not prevent the international shipping on its highways as such. Conversely, the navigation routes and NWPs and NSP foreign vessels will help diversify the economy of the northern region, which is mainly dependent on the mining and oil company towns, and encourage sustainable howling socio--‐economic and infrastructure devel--‐ opment in general. In the end, the internationalization of NWPs and NSP will depend on the im--‐ portance of the straits for international navigation and on the measures to take coastal states.

Canada and Russia adhere to the position that all of the principles of freedom of the high seas, including the freedom of navigation, should be applied outside their territorial waters. As al--‐ ready mentioned, the implementation of the international shipping --‐ in the interests of both Rus--‐ sia and Canada and other countries. Therefore, Russia and Canada, according to the Convention on the Law of the Sea, guarantee the right of innocent passage along the NWPs and NSP Arctic coasts.

Ships of all States, whether coastal or not locked, enjoy the right of the innocent passage through the territorial sea 26.

This implies that foreign ships should not only inform the coastal States of its intentions, and requested permission to pass, and the government has the coastal state, in turn, given the ice conditions and the characteristics of the vessel, as well as in the accordance with Article 234 Con--‐ vention on the areas covered by ice, must give its permission for the application.

Anyway 1982 UN Convention does not clearly interpret the phrase "that bays are used for the international navigation". Accordingly, its interpretation can be different depending on the factors considered: for example, the number of vessels used the Straits tonnage, the number of flags of States, under which an aisle 27.

Effective preventive measure against the internationalization based on the right of the transit passage --‐ are continuing the use of NWPs and NSP with simultaneous support for and the development of the coastal infrastructure. These ships are oil tankers, trucks, even of the highest ice class "1A" in need of the port infrastructure, ice wiring information support on ice conditions, weather and other conditions. And this is exactly what has to be demonstrated to States in the proof of long and efficient use of NWPs and NSP in order to be recognized by the national water--‐ ways in the international community.

The northern regions of Russia and Canada are similar, and because countries have to face the same difficulties and solve the same questions: fragile environment, severe weather, perma--‐ frost, polar night, the lack of infrastructure to support economic activity and rapid response in the event of an environmental incident (eg oil spill tanker is damaged skin). So before SMP and FFP will be fully operational, it is necessary to find answers to the following questions: What risks ex--‐ posed to commercial shipping in the Arctic Ocean? What actions can take marine insurance clubs in case the insured event and what will be their policy in general? How quickly can respond in the event of the shore based environmental threat?

It should be mentioned draft Polar Code, developed by the International Maritime Organi--‐ zation (IMO). Polar Code will become a legally binding document, the regulatory requirements for the safety of navigation in ice conditions: the construction, equipment and operation of ships, specialized training for crews, search and rescue, counter the risk of environmental contamina--‐ tion. Polar Code will include the provisions of the Convention on the Law of the Sea, SOLAS 28, MARPOL 29, STCW 30 and other recommendations and requirements of the IMO 31.

NWP and NSP as a magnet, attracting and those countries that do not have direct access to either the Arctic Ocean or in the Arctic region as a whole. First of all, it is gaining momentum Asian economic powers such as China, South Korea, Japan and India. Also of interest in the commercial shipping industry is worth noting the U.S., Denmark, Germany and the European Union as a whole. These countries rely on the right of transit passage, as enshrined in the Convention on the Law of the Sea, and called the SMP and EWS part of the international transport system. All ships and air--‐ craft enjoy the right of transit passage, which shall not be impeded, except that, if the strait is formed by an island of a State bordering the strait and its mainland 32. Transit pass is the freedom of navigation and overflight solely for the purpose of continuous and expeditious transit of the strait between one part of the high seas or an exclusive economic zone and another part of the high seas or an exclusive economic zone. However, the requirement of continuous and expedi--‐ tious transit does not preclude passage through the strait for the purpose of entering, leaving or returning from a State bordering the strait, subject to the conditions of entry to that State (Art. 38, § 1).

In 2009, the USA published a presidential directive 33, which clearly expressed the position about NSP and NWP as straits used for the international navigation. They apply the regime of the transit passage.

The future development of the Arctic highways

Despite all the threats and risks, opportunities and benefits brought the Arctic transport system; the main question is to whom the Arctic Klondike will belong? At the moment, a single le--‐ gal regime, universally recognized by all nations in the Arctic Ocean does not exist.

First, the Convention on the Law of the Sea is not ratified by the United States. Secondly, the international community will have to face the problem of the legal regimes of NSP and NWP as the national highways to the concept of the international straits. In other words, the right of the innocent passage against the transit passage.

In this uncertain situation, any act of the manifestation of the sovereignty, including the application to the UN Commission on the Continental Shelf, political statements, development and the implementation of the internal regulations --‐ a demonstration of the political ambition, which is a country in the region. It's a way to make clear that the government has the intention and, moreover, there is the economic potential to realize these ambitions.

The rationale for sovereignty is not only the right of discovery, or the national legislation, but also long--‐lasting and effective use 34. «Use it or lose it».

From this perspective, the question arises, what is the scenario for the future development of NSP and NWP in the Arctic region? Report about the Arctic marine shipping, prepared by the working group of the Arctic Council, provides four options for the development. Took into account the following factors: the level of demand in the commercial shipping in the Arctic Ocean and sta--‐ bility control.

• a)    Arctic race: high demand and intermittent control (ad hoc) can prvocate the fight for the Arctic resources and wealth.

• b)    Polar depression: low demand and unstable governance turn the Arctic into a subsidized region with a poor economy.

• c)    Polar Reservation: low demand, but stable and efficient management will hamper the eco--‐ nomic development of the region, which will strengthen ecological protection with poten--‐ tial zones forbidden for the commercial navigation.

• d)    The Arctic Saga: high demand and stable management will bring economic prosperity in the interests of indigenous people and the ecosystem approach environmental protec--‐ tion 35, 36 .

While some politicians have questioned how NSP and NWP may be cost--‐effective if ship--‐ ping is not available throughout the year, you should take into account the trend of the last summer navigation season. Commercial shipping along the NSP in 2011 began June 29 and last--‐ ed until mid--‐November. According to "Rosatomflota 'transit through the NSP in 2010 was about 100 thousand tons in 2011 reached 820 thousand tons37. It is obvious that NSP and NWP even--‐ tually open competitiveness, alternative transportation system of sea communications needed by modern trade flows. The future of the legal regime will depend on what measures Russia and Canada will take to protect its sovereignty, and how the state will monitor international shipping.

While some politicians have questioned how NSP and NWP may be cost--‐effective if ship--‐ ping is not available throughout the year, you should take into account the trend of the last sum--‐ mer navigation season. Commercial shipping along the NSP in 2011 began June 29 and lasted until mid--‐November. According to "Rosatomfleet 'transit through the NSP in 2010 was about 100 thou--‐ sand tons in 2011 reached 820 thousand tons. It is obvious that NSPs with NWP eventually open competitiveness, alternative transportation system of sea communications needed by the modern trade flows. The future of the legal regime will depend on what measures Russia and Canada will take to protect its sovereignty, and how the state will monitor the international shipping.

Undoubtedly, the intensification of the Arctic navigation becomes a catalyst for the eco--‐ nomic development of the Far North, and the infrastructure will support the prosperity of the re--‐ gion. However, despite the optimistic predictions for the future of the Arctic thoroughfare, at the moment it is not clear to the full extent of the Arctic saga realistic scenario, since one can not deny the fact of increasing the economic potential along with the potential military. In this context it is particularly important to emphasize the significance of the instruments of international law in the conflict of interests of different countries to ratify the UN Convention on the Law of the Sea and the principles of the Declaration Ilulissatkoy resolve all disputes peacefully38. It is also important to strengthen the role of the International Maritime Organization and the effectiveness of the system of regulation of Arctic navigation, including the introduction of the Polar Code, completion of which is expected in 2012. Finally, it is important when negotiating the potential of the Arctic Council as an intergovernmental forum.