Opinion: To Support U.S. Interests, Ratify UNCLOS and Rotterdam Rules
From photos of anchored container ships waiting to unload at U.S. ports highlighting the supply chain crisis, to China’s maritime expansionism in the Pacific further threatening international trade and peace, current events point to two key international maritime treaties the Senate should ratify now: (1) the U.N. Convention on Contracts for the International Carriage of Goods Wholly or Partly by Sea, known as the “Rotterdam Rules” and (2) the U.N. Convention on the Law of the Sea, best known as the “Law of the Sea Convention” or “UNCLOS.”
The Rotterdam Rules
First, the Rotterdam Rules’ very goal is to encourage worldwide e-commerce to replace slow paper transactions dating from the earliest days of sail. Much of the world’s shipping industry is stuck in this archaic stamping, signing, sending, re-stamping, re-signing, copying, forwarding, and delivering of hard copy bills of lading and other shipping documents at each transportation link. This is due to outdated, sometimes conflicting shipping treaties. One, the Hague Rules, goes back to 1924, implemented in the U.S. by the 1936 Carriage of Goods by Sea Act. A lot has changed since then with multi-modal shipping of containers by ship, train, and truck.
Because shipping is so international, legal uniformity, commercial predictability, and worldwide harmonization with modern containerization and e-commerce is essential to reducing cargo processing time and errors which result in supply chain snags.
The Rotterdam Rules provide the needed international legal regime to support containerized e-commerce and reductions in transportation time resulting from more efficiently moving cargo on its ocean leg, as well as its prior and subsequent land legs in multi-national transportation transactions.
Because the U.S. role as cargo importer and cargo exporter occupies such a major segment of the world’s sea trade, the Rotterdam Rules will need to be adopted by the U.S. before the rest of the world’s maritime countries sign on -- and they will. The U.S. has to make the first move -- and we should.
The Rotterdam Rules will not only speed things up; they’re also good for the U.S. Most Americans are unaware that there are almost no commercial ships operated internationally by U.S. companies: Virtually all of our outgoing and incoming cargo is carried on foreign ships. Because the Rotterdam Rules level the liability playing field for U.S. cargo interests vis-à-vis foreign ships and incentivize onboard cargo safety, ratification of the treaty will benefit exporting American cargo growers, producers, and manufacturers as well as importing American consumers.
Certainly much of the supply chain crisis was brought on by the pandemic’s stay-at-home online shopping, which may or may not subside in the future. And while there will continue to be supply chain challenges in overcoming a shortage of truck drivers, chassis, and warehouse space at U.S. ports and in modernizing port infrastructure, speeding up millions upon millions of routine cargo transportation legs with e-commerce supported by uniform international law governing worldwide transactions is a no-brainer.
The Rotterdam Rules will accomplish that. Supported worldwide by ocean carriers, shippers, receivers, and insurers, the Rotterdam Rules will take advantage of e-commerce technology and smooth cargo discharge through our ports. The Senate should ratify the Rotterdam Rules now without any partisan bickering.
Second, recent maritime powerplays highlight the long overdue need for the Senate to ratify UNCLOS -- also without bickering. Because the U.S. advantageously negotiated its provisions back in the 1980s-90s, UNCLOS enshrines freedom of navigation on the high seas and if ratified by us will advance our interests as a global maritime power. Top U.S. military leaders -- not just the Navy and Coast Guard -- have consistently supported ratification. UNCLOS also advances U.S. interests as a coastal nation and our rights to the natural resources in our 200-mile offshore Exclusive Economic Zone. Further, UNCLOS promotes the environmental health of the world’s oceans.
Senate ratification of UNCLOS is now more urgent than ever so the U.S. can legally challenge China’s ongoing maritime expansionism, including China’s militaristic annexation of the Spratly Islands in the South China Sea and China’s bellicosity towards Taiwan, the Philippines, Australia, and Pacific trade routes used to transport U.S. cargo. China is also trying to restrict freedom of navigation and overflight on the high seas off its shores, contrary to UNCLOS.
Since the U.S. is not a party to UNCLOS, we are handcuffed and nothing but hypocritical when criticizing China for its UNCLOS transgressions. Troubling too, unless we ratify UNCLOS, the U.S. will be left ashore when China strikes paydirt following the issuance of deep-sea mining permits scheduled for 2023 by the UNCLOS-created International Seabed Authority.
Even with U.S. domestic political divisiveness, China’s maritime militarism and maneuvering is something Republicans and Democrats should agree to constrain by bilaterally mustering the two-thirds Senate vote needed under the U.S. Constitution to ratify this treaty.
China also needs to be closely watched in the Arctic -- another region where the U.S. is hamstrung without the force of UNCLOS behind us. China claims to be a “Near-Arctic State” and is conducting “scientific research” in the Arctic. To maintain its “Polar Silk Road” China is building its third Arctic icebreaker -- in contrast to the U.S. which now has only one old heavy icebreaker that splits its time between the Arctic and the Antarctic.
Russia of course is also a concern. Its aggressive claims in the Black Sea and to the Arctic continental shelf and international straits are contrary to UNCLOS, but again our protests are hollow since the U.S. is not a party to the treaty. As we all know, Arctic sea ice is melting quickly and just as quickly is opening up the Arctic to commercial shipping. Faster than using the Suez Canal, it is now viable in summer to sail from the Pacific through the Bering Strait west of Alaska and along the Northern Sea Route over the top of Russia to Europe.
In addition, cruise ships, commercial fishing, energy development, and mineral exploration are new and growing Arctic industries. These pose environmental risks including devastating cold water oil spills and other maritime casualties far, far, away from any nation’s Coast Guard and first responders. Circumpolar Inuit people and others face upheaval.
But without ratifying UNCLOS, the U.S. has limited sway over Arctic developments. Critically, unless we ratify UNCLOS, a U.S. representative cannot sit on the Commission on the Limits of the Continental Shelf to best protect the contours of our claim to a U.S. Exclusive Economic Zone north of Alaska.
The Arctic Ocean's resources are opening up, for good or bad, and so are geo-political claims to them -- but the U.S. is losing out on both.
With 161 other countries plus the European Union having already adopted UNCLOS, our failure to ratify the treaty gives credence to worldwide skepticism of U.S. leadership and declining respect for the U.S. in promoting the international rule of law. UNCLOS is recognized by the rest of the world as the international Law of the Sea -- and even the U.S. acknowledges that. International tribunals have rendered scores of Law of the Sea legal decisions. But because we are not an UNCLOS player, we have no influence on this emerging international jurisprudence and everything the U.S. argues on the world stage relating to maritime issues is taken with a grain of sea salt.
The U.S. should ratify UNCLOS now to derive our negotiated benefits from it.
There is no downside and only positives for the U.S. As a practical matter, we already closely adhere to UNCLOS standards, so the U.S. can ratify without any disruption to our military or commercial operations. Gaining seats at various UNCLOS tables, we will be able to influence evolving maritime developments and laws. And with our expanded oceanic access, U.S. maritime industries and workers will have more work.
It should also be recognized that any anti-U.N. sentiment opposed to UNCLOS not only lacks merit but would also have the U.S. miss the boat on an opportunity to best promote our maritime interests and sovereignty -- including the assertion of U.S. rights in the Arctic and elsewhere.
Ratify Both Treaties Now
The Maritime Law Association of the United States, joined fully by the American Bar Association, emphatically urges the Biden Administration and the Senate to take immediate action to ratify both of these international maritime treaties which should have bipartisan support. They will allow the U.S. to best address current and future global maritime issues.
In sum, the U.S. as a maritime power should endorse the universally accepted international Law of the Sea by ratifying UNCLOS so we can derive its benefits, and should also lead the world in adopting the Rotterdam Rules to facilitate electronic, interconnected, global ocean commerce.
David J. Farrell, Jr. is President of The Maritime Law Association of the United States, founded in 1899. Its membership consists of 2,200 maritime lawyers and industry leaders. The association does not lobby because its members professionally represent a wide variety of interests, often conflicting. But on especially worthy public policies that would benefit from a legal solution with no downside, it adopts consensus resolutions, as it has done urging U.S. ratification of UNCLOS and the Rotterdam Rules.
The opinions expressed herein are the author's and not necessarily those of The Maritime Executive.