National security as a foundation and a limit on a state's right to rely on permanent sovereignty over natural resources (D.S. Boklan, A.V. Korshunova, журнал "Kutafin University Law Review", N 2 (Volume 4), October 2017)

National security as a foundation and a limit on a state's right to rely on permanent sovereignty over natural resources

D.S. Boklan,

Doctor of Science (Law), Associate Professor, Department of

International Public and Private Law, Faculty of Law,

National Research University Higher School of Economics,

Moscow, Russia

A.V. Korshunova,

Postgraduate student, Department of International Law, Faculty of

International Law, Russian Foreign Trade Academy,

Moscow, Russia

Журнал "Kutafin University Law Review", N 2 (Volume 4), October 2017, р. 292-314.

The article focuses on the environmental and economic security of a State as the constituent elements of its national security protected by the principle of permanent sovereignty over natural resources. It also analyses interdependency of the two, exposing their practical interconnection in a way that a threat to environmental stability almost necessarily affects economic stability of a State. At the same time, a right to permanent sovereignty over natural resources is not absolute and should be exercised so as not to endanger environmental and economic security of others.

Table of contents

I. Introduction

II. Interaction between environmental and economic security as elements of national security of a State

III. Principle of sovereignty over natural resources as a principal mechanism for protecting national security of a State

IV. Interests of national security as a limit on State's right to rely on permanent sovereignty over natural resources

V. Conclusion

References

I. Introduction

It is common to think of international environmental and international economic law as areas protecting diagonal interests. However, a closer look reveals that there is a firm interconnection, and even more significantly, interdependency of the two. Both environmental and economic stability of a State are critical for its national security, which can only be preserved if full effect is given to the customary international law principle of permanent sovereignty over natural resources. At the same time, potential far-reaching effects of economic activity, including exploration of natural resources, within the territory of one state on environment of other States result in a prerequisite limitations of the ability of States to rely on the right to permanent sovereignty over natural resources. This can only be exercised to the extent, which does not endanger national security of other States as comprising environmental and economic security. As M. Koskenniemi put it, "where national governments intervene, they do this on the basis of advice from essentially non-national networks of financial, military, or environmental expertise. Even the domestic government may be a coalition not so much of domestic parties but of local representatives of intrinsically global financial, environmental, or security interests - a forum within which human rights and security experts, say, or representatives of trade and health interests, conclude barging about the allocation of social resources"*(1).

II. Interaction between environmental and economic security as elements of national security of a State

It is now undisputed that the concept of national security goes beyond military security of a State covering wide range of its interests, including economic stability, as was recognized by international tribunals*(2). And if these systems point in different directions - as the systems of trade and environment - then one should simply bargain to balance the stakes, to compromise, and to allocate jurisdiction in the most effective manner*(3). Further, there is a direct link between environmental security and economic stability of a State, which makes the former no less important essential for the overall national security of a State. Today national security of a State is equally affected by the growing pace of exploration of natural resources as a result of enhancement of economic activity, and world and regional environmental problems. Therefore, environmental and economic security are closely intertwined, both at global and local levels.

For this reason, currently, the international community faces urgent need to "enviromentalise" international economic relations. This process is warranted by objective reality of modern world which experiences degradation of environment along with lack of natural resources, on the one hand, and prolonged economic crisis, on the other consequently, development of international economic relations should also take into account the purposes of international environmental law*(4). These purposes, first of all, include ensuring environmental security.

Setting international legal standards for environmental security is a prerequisite for the economic development of a State. As it is stated by M. Kopylov: "at present the concept of environmental security is conditioned by interconnection with strategic issues of social and economic development creating an obligation for all States to attain and sustain environmental security"*(5). According to the Environmental Strategy of the Russian Federation*(6) national security of the Russian Federation is only ensured provided for natural ecosystems and adequate environment are preserved.

Already in 1987 USSR adopted a concept of comprehensive system of international security, where environmental security formed a part of economic security*(7). Environmental security means such conditions where all vital interests of a State, society and individuals are safe from real or potential threats created by human or natural impact on the environment*(8). At the first place Such anthropogenic activities include economic activity. Thus, according to the draft Federal law of the Russian Federation "On Technical Rules 'On Environmental Security, environmental security of business activity should be understood as a system of technological measures aimed at prevention of harm to environment and of any threat of emergency. Local law of Nizhniy Novgorod "On environmental security" defines this concept as "conditions ensuring protection of the environment and vital interest of a human being from potential adverse effect of business and other activity, emergencies of natural or technogenic nature and their consequences". Thus, both scholars and Russian lawmakers observe the link between environmental security and business activity.

At the same time, in the context of globalization and increasing economic interdependency of States, a significant part of such business activity is governed by rules of international economic law. It is noted that "globalization vanishes the line between international and merely domestic activity of States"*(9). In particular, such activity may include construction of energy projects, mineral resource and chemical enterprises; production of toxic and other dangerous substances; landfill; production of foodstuff and its elements, including those made up of genetically modified organisms, activity resulting in air pollution, as well as many other types of economic activity.

Consequently, practically any trans-border transfer of technology, goods and services, governed by rules of international economic law has direct effect on environmental security of each particular State and international community as a whole. Furthermore, shortage of natural resources in case of their inefficient and unreasonable use would also straightforwardly influence economic security of a State.

In this regard, international energy sector is an illustrative example. Traditional energy sources used today are hydrocarbons, hydro and nuclear energy, from the former: oil, natural gas, coal are all nonrenewable.

According to European Commission, by 2020-2030 dependency of Western Europe on third States for gas supply may reach 70%, for oil - 90% and for coal - 100%. Dependency of East and Central Europe on gas import is expected to increase from 60% to 90%, with regard to oil from 90% to 94% and these States may turn from net exporters of coal to coal importers forced to purchase abroad about 12% of the consumed coal*(10). On the other side, production and consumption of hydrocarbons causes serious pollution with saturation surrounding Caspian region (where States are major exporters of gas to the European Union with Russia as a transit State) serving a perfect example. The Caspian is a source of more than 130 species of sturgeon fish. At present, Caspian waters are devastatingly polluted by oil and gas exploration. In some of the regions the environmental situation is almost catastrophic. While in 1983 the scientists reported that the Caspian sea had over 114,7 mln sturgeon fish, in 1991 this number was 88,3 mln reducing in 2005 to scarce 42,4 mln. Thus, for comparatively short period of time the population of fish dropped almost by three times*(11).

Reliance on hydro energy is concerned with flooding of significant territories, which causes devastation of the ecosystems.

As for nuclear energy, recently both Europe and USA take approach to conserve or even demolish nuclear energy plans in the light of striking risk of harm to human health and environment. The following reasons were forcing States to reject nuclear energy consumption: life time of any nuclear plant is about 30 years; long-term facilitation of environmentally safe storage of radioactive components is increasingly complicated; risk of an accident given that radioactive pollution is one of the most dangerous types of pollution.

It was for a reason that notwithstanding independence of European States in terms of energy resources supply, the European Energy Charter comprises provisions on the effect of energy production, supply and consumption on the environment with the purpose to prevent or decrease the corresponding adverse environmental effects. As M. Kopylov notes: "since there is no alternative to economic development, nor to increasing measures for protection of the environment, ensuring environmental security should have firm grounds in international law"*(12). It is believed that such firm international law ground may be created by coordination of international economic and international environmental law. Transfer of goods, services and technologies that create a risk of causing harm to the environment constitutes a potential threat and makes vital interests of human beings, communities, nature and States vulnerable.

Therefore, a threat to environmental security of a State does not only directly affect life conditions of people of that State, but may potentially also undermine economic stability of that State. Both environmental and economic security are equally critical interests of a State, which both form consistent part of its national security.

III. Principle of sovereignty over natural resources as a principal mechanism for protecting national security of a State

There is a straightforward link between national security and principle of sovereignty of States. Indeed, a right of a State to freely exercise full power within its territorial borders is the primary mechanism designed by international law to allow States to control and protect national security. Permanent sovereignty of a State over its natural resources is the specification of a wider concept of territorial sovereignty, as applicable to international economic and environmental relations.

Pursuant to the principle of permanent sovereignty over natural resources all States enjoy inalienable right to "freely to dispose of their natural wealth and resources in accordance with their national interests" under their sovereignty*(13). This principle was expressly affirmed by the International Court of Justice to represent customary international law*(14). It is provided for in over than 80 UN General Assembly Resolutions*(15). Further, the said concept is enshrined in International Covenant on Civil and Political Rights 1996 and International Covenant on Economic, Social and Cultural Rights 1996, as well as in the whole set of international agreements predominantly governing international environmental relations*(16). Permanent sovereignty over natural resources also forms part of the Charter of Economic Rights and Duties of States 1974, 1974, both being sources of international economic law. Further, the same is provided in The Rio Declaration on Environment and Development 1992, a source of international environmental law.

Interestingly, some authors consider principle of State's sovereignty over natural resources as a lex specialis principle of international economic law*(17), whereas others treat it as a sectoral principle of international environmental law*(18). Moreover, some scholars point at this principle as that of both said areas of law*(19).

Natural resources constitute the major economic values of a State. Unlawful acquisition of natural resources of another State would constitute a breach of territorial integrity of that State. Hence the granting of a right to explore natural resources of third States is only possible upon permission of a State under which sovereignty they are located, since States are independent and have a right to take decisions regarding disposition of their natural sovereignty without interference. Thus, in Island of Palmas case (the Netherlands/USA) (1928) arbitrator M. Huber stated that "[s]overeignty in the relations between States signifies independence. Independence in regard to a portion of the globe is the right to exercise therein, to the exclusion of any other State, the functions of a State"*(20). As it is fairly observed by S. Chernichneko: "if a State grants another State a right to explore its national resources in a particular area, it only transfers part of its rights, but not its sovereignty over natural resources in general... It is more accurate to describe it as assignment of a right to explore to a certain limit the identified natural resources. and not even sovereign right or rights, which eventually rest with the sovereign"*(21).

United Nations General Assembly Resolution 1803 on Permanent Sovereignty over Natural Resources (1962) provides that "free and beneficial exercise of the sovereignty of peoples and nations over their natural resources must be furthered by the mutual respect of States based on their sovereign equality". According to V. Ivanenko and V. Kuznetsov, such mention of interconnection between sovereign equality and respect to State's rights, which is an inherent feature of sovereignty, both widens this principle, underlying international cooperation, and makes it more specific. This is especially true for economic relations, for which the problem of protection of sovereign rights of many States is of increased importance*(22).

In the same vein, the economic nature of a right to permanent sovereignty over natural resources is stressed in UNCTAD Resolution recalling numerous UN GA Resolutions on the subject, where it is stated that "the right of peoples and nations to permanent sovereignty over their natural wealth and resources must be exercised in the interest of their national development and of the well-being of the people of the State concerned"*(23).

IV. Interests of national security as a limit on state's right to rely on permanent sovereignty over natural resources

It should be noted that an opinion that the concept of absolute sovereignty shall be considered outdated*(24) or inconsistent with the existence of the global world and the general tendency to legal integration will become increasingly popular*(25). Such debate is particularly noticeable in the international economic and international environmental law.

"Sovereignty may be deemed actual for all the States only within international legal order"*(26). International law reflects States' recognitions of such legal feature as their sovereignty with all stemming consequences, and first of all their sovereign equality and corollary mutual respect of their sovereignty*(27).

Thus, Lauterpacht, referring to the judgments of the Permanent Court of International Justice in Interpretation of the Statute of the Memel Territory*(28) and Lighthouses in Crete and Samos*(29), concludes: "sovereignty is not in the nature of an absolute and rigid category"*(30).

Indeed, international courts, for instance, in S.S. Wimbledon case*(31) and Corfu Channel*(32), also gave full effect to the rules of international law imposing limitations upon sovereignty famously holding in the latter that each State bears "[an] obligation not to allow knowingly its territory to be used for acts contrary to the rights of other States"*(33). The Permanent Court of International Justice recognized that rights of other States would limit even such vital concept of international law as sovereignty in the Lotus case*(34), where it is declared that the "first and foremost restriction" imposed upon a state by international law is that in principle a state shall not exercise its power in the territory of another state, hence implying that other limitations on sovereignty, besides this "first and foremost restriction," have to exist.

Thus, sovereign power of a State is limited by sovereign powers of other States. Consequently, adverse effect on the environment of any other State is an attack on its sovereignty. On the other hand, all States have the equal right to independent economic development. This should mean that, according to the concept of permanent sovereignty over natural resources, States have a right to freely and independently determine their economic development and exploration of natural resources. However, such freedom is restricted by a duty not to cause damage to environment and economic development of other States, as well as by imperative implications of environmental security of other States and international community as a whole. In accordance with the above-mentioned UN GA Resolution "On permanent sovereignty over natural resources" 1962 "exploration, development and disposition of such resources, as well as the import of the foreign capital required for these purposes, should be in conformity with the rules and conditions which the peoples and nations freely consider to be necessary or desirable with regard to the authorization, restriction or prohibition of such activities." It further declares that "[t]he free and beneficial exercise of the sovereignty of peoples and nations over their national resources must be furthered by the mutual respect of States based on their sovereign equality," and violation of the sovereignty over natural resources is "contrary to the spirit and principles of the Charter of the United Nations and hinders the development of international cooperation and the maintenance of peace." Therefore, already in 1962 this Resolution flagged the prerequisites for restricting business activity by the "green" interests. The Resolution, inter alia, expressly appreciates the value of natural resources for economic development of States and stipulates that any measure in respect to natural resources should be taken on respect for the economic independence of States.

Similarly, United Nations General Assembly' Resolution 1515 (XV) declares that "the sovereign right of every State to dispose of its wealth and its natural resources should be respected in conformity with the rights and duties of States under international law."

Thus, permanent sovereignty over natural resources creates a corresponding duty to recognize and respect other states' sovereignty over their natural resources, which means States are obliged to retain from actions which may be prejudicial to permanent sovereignty over natural resources of other States*(35).

In particular, interpretation and application of the principle of permanent sovereignty of States over their natural resources should be carried out in line with the rules of international economic, as well as international environmental law. In this case these two sets of rules may be defined as a complex of rules, which G. Velyaminov calls "those formed around core concept rule-principle and specifying this rule, such as principle of sovereign equality and respect to the State's rights inherent to sovereignty"*(36). First and foremost, the "limitation" on sovereignty to freely explore natural resources is customary international obligation to prevent transboundary harm*(37).

As demonstrated, principle of permanent sovereignty over natural resources is the international cornerstone of facilitating economic development of a State, on the one hand, and environmental security, on the other. The discussed matter is of particular relevance for Russia, given that on one side, its natural resources related economy sectors are highly attractive for foreign investors, and on the other side, the ecosystems located in Russia are in itself a high-valued asset for Russia and international community as a whole. Territory of the Russian Federation has about 9 mln sq m of untouched ecosystems. Russia is the leading country by absorption (due to forests and morasses) of CO2 (approx. 40%). The second country by this characteristic is Brazil with absorption level of about 20%*(38). Environment-forming function of the Russian nature is the largest "natural asset" in the world, which determines the central role of the Russian Federation in solving issues of ensuring bio stability. Sustaining such stability of biosphere functioning goes to facilitating securing global environmental security, where the position of Russia is no less important that in building international energy security*(39).

The scope of environmental law, international and domestic, accordingly determines territorial scope of environment as a whole, as well as particular natural ecosystems. For domestic law it is limited by the territory of a State, and depending on the interests of a State - by the territory of a constituent element of the Russian Federation. Designation of geographical boarders of natural ecosystems is a mere convention*(40). It should also be noted that States enjoy rights with respect to protection of the environment of the exclusive economic zone and continental shelf.

In the 2005 National Human Development Report Russia it is stated that Russia is an environmental donor with substantial natural resources and with national territory that accounts for one-seventh of the global land area, which makes crucial its contribution to ensuring sustainable development*(41).

Long-term economic growth of every State and international community as a whole majorly hinges upon the condition of environment and natural resources being its constituent part. Hence, permanent sovereignty of a State over natural resources is an intersectoral principle intrinsic to both international environmental and economic law with its contents, interpretation and application conditioned by intertwined environmental and economic interests of States. Preservation of natural resources is a critical factor necessary for the long-term economic growth, especially given that all States differ in level of their economic development, as well as in range and extent of natural resources. However, unfortunately, at present the issues of environmental security are more often used as a leverage to exert political pressure in international relations rather than as an ultimate aim which warrants the urgent solution. As a result, the efficiency of the economic growth, similarly to that of prevention of environmental harm, including human health and ensuring financial stability, remains inadequate. As A. Vylegzhanin puts it discussing problematic aspects of application of international law rules: "since interests of States may objectively not coincide or even contradict each other, inter-State competition is reflected in ... differential, sometimes diagonal interpretation of the same legal norms"*(42). Therefore, international community needs to work out a coherent set of rules prohibiting unlawful exploitation of natural resources, as well as preventing harm to ecosystems as a result of lawful business operations and ensuring environmental security.

V. Conclusion

First, permanent sovereignty of a State over its natural resources is a primary international concept for protection of State's national security, including its economic and environmental element.

Second, States are not free to refer to State's sovereignty over natural resources to utilize them without any restriction. Sovereignty of a State should be exercised in a manner, which does not threaten national security of other States. In particular, States have to comply with established rules of international environmental law which are designed to protect environmental and economic security of other States.

References

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*(1) Martti Koskenniemi, What Use for Sovereignty Today? (2011) 1 Asian Journal of International Law, p. 61.

*(2) UNCTAD Series on International Investment Policies for Development, The Protection of National Security in IIAs (2009), p. 49. Available at: http://unctad.org/en/docs/diaeia20085_en.pdf.

*(3) Martti Koskenniemi, What Use for Sovereignty Today? (2011) 1 Asian Journal of International Law, p. 65.

*(4) Paolo Galizzi, Economic Instruments as Tools for the Protection of the International Environment (European Energy and Environmental Law Review, 1997, pp 155-157).

*(5) Kamil Bekyashev, Mikhail Kopylov, Revol Valeev and others (ed. Valeev), International environmental law: textbook (2012), p. 25.

*(6) Available at: http://www.rg.ru/oficial/doc/raspor_rf/1225-p.shtm.

*(7) Mikhail Gorbachev, Reality and Guarantees of the Secure World (Pravda, 1987).

*(8) Environmental security in Eurasia, Interview with professor of international law department of RUDN, Mikhail Kopylov PhD (Eurasian Law Journal, 2013, No 8 (63), p 7).

*(9) Pavel Biryukov, International Law: textbook (Yurist, 2013, p. 36).

*(10) Irina Pashkovskaya, European Union: formation of foreign energy policy (Analytical reports, 2008, No. 1 (20). Available at: http://www.mgimo.ru/files/15547/ad-20.pdf.

*(11) Oil curse of Caspian Sturgeon, Russian News. Available at: http://www.russianews.ru/newspaper/17764/17780.

*(12) Mikhail Kopylov, On the legal meaning of the concept "environmental security" (Pravovedenie, 2000, No. 1, p. 114).

*(13) Pavel Biryukov, International law: textbook (Yurist, 2006, p. 611).

*(14) Armed Activities on the Territory of the Congo (Democratic Republic of the Congo v. Uganda), Judgment, I.C.J. Reports 2005, p. 168, para. 244.

*(15) Schrijver N. Sovereignty over Natural Resources. Balancing Rights and Duties (Cambridge, 1997).

*(16) The Convention on Biological Diversity 1992 (Article 3), The United Nations Framework Convention on Climate Change 1992 (preambular 8), Vienna Convention on Succession of States in respect of Treaties 1978 (Article 13).

*(17) Vladimir Shoumilov, International Economic Law (2002), p. 89; L. Anufrieva, K. Bekyashev, G. Dmitrieva and others (ed. K. Bekyashev), Public International Law: textbook (2005), p. 420; Alexander Kovalev, Intetrnational economic law and legal framework of international economic activity: textbook (2007), p. 40; Eduard Kuzmin, International economic law: textbook (2007), p. 52; Alexander Purtov, Principle of mutual benefit in international economic law (2001), p. 26.

*(18) B. Ashavsky, M. Biryukov, S. Chernichenko and others (ed. A. Kovalev, S. Chernichenko), International law: textbook (2006), p. 527; O. Dubovik, L. Kremer, G. Luybbe-Volff (ed. O. Dubovik), Enviromental law: textbook (2005), p. 56; Mikhail Brinchuk, Enviromental Law (2004), p. 620; Irina Getman-Pavlova, International law: textbook (2006), p. 722; Igor Lukashuk, International law: textbook, special part (2008), p. 187; L. Anufrieva, G. Shinkaretckaya, V. Shoumilov and others (ed. G. Melkov), International law: textbook (2012), p. 533.

*(19) Pavel Biryukov, International law: textbook (Yurist, 2006, pp. 596, 611).

*(20) Island of Palmas case (Netherlands v. USA), 1928 II RIAA 829, 838.

*(21) Stanislav Chernichenko, Could we divide state sovereignty? (Eurasian Law Journal, 2010, No. 12 (31), p. 31).

*(22) A. Abshahidze, M. Kopylov, I. Lukashuk and others (ed. V. Kuznetsov, B. Tuzmukhamedov), International law: textbook (2007), pp. 196-197.

*(23) UNCTAD Trade And Development Board Resolution 88 (XII) Permanent sovereignty over natural resources (1972) recalling UN General Assembly resolutions 523 (VI) of 12 January 1952, 626 (VII) of 21 December 1952, 1515 (XV) of 15 December 1960, 1805 (XVII) of 14 December 1962, 2158 (XXI) of 25 November 1966 and 2386 (XXIII) of 19 November 1968, recalling in particular the principles stated in resolution 1803 (XVII).

*(24) Kamil Bekyashev, Principle of respect to sovereignty of a State as an underlying principle of general international law (Lex Russica, 2008, No. 4, pp. 913-928).

*(25) Pavel Biryukov, International law: textbook (Yurist, 2008, p. 38).

*(26) Igor Lukashuk, International law: textbook, general part (2008), p. 309.

*(27) Stanislav Chernichenko, Could we divide state sovereignty? (Eurasian Law Journal, 2010, No.12 (31), p. 27).

*(28) (U.K. v. Lith.) 1932 P.C.I.J. (ser. A/B) No. 49, pp. 313-314 (Aug. 11).

*(29) (France v. Greece) 1937 P.C.I.J. (ser. A/B) No. 71, p. 103 (Oct. 8).

*(30) Hersch Lauterpacht, The Development of International Law by the International Court (Grotius Publications Limited, 1958), p. 324.

*(31) (Gr. Brit., Fr., Italy, Japan v. Ger.), 1923 P.C.I.J. (ser. A) No. 1, pp. 24-25 (Aug. 17).

*(32) (U.K v. Alb.), 1949 I.C.J. 4 (Apr. 9).

*(33) Id., p. 22.

*(34) S.S. Lotus (Fr. v. Turk.), 1927 P.C.I.J. (ser. A) No. 10, p. 18 (Sept. 7).

*(35) Case Concerning East Timor (Portugal v. Australia) 1995 I.C.J. 90, 221 (Weeramantry, J., dissenting); Id. at 264, 270 (Skubiszewski, J., dissenting); Id. at 204 (Weeramantry, J., dissenting).

*(36) Georgy Velyaminov, International Economic Law and Procedure: Textbook (2004), p. 101.

*(37) Franz Xaver Perrez, The Relationship Between "Permanent Sovereignty" And The Obligation Not To Cause Transboundary Environmental Damage (26 Environmental Law 1187), p. 1207.

*(38) Yuriy Matveevsky, Environmental problems have significant impact on relations of Russia and European Union (Europe, 1999, No. 3, pp. 35-37).

*(29) D. Pavlov, E. Bukvareva, Biodiversity, ecosystem functions and life support of humanity (RAN Review, 2007, No. 11, p. 981).

*(40) Mikhail Brinchuk, The Universe as a universal natural environment: legal and philosophical aspects (Astrakhan Review of Environmental Education, 2012, No. 2 (18), p. 17).

*(41) S. Bobylev, A. Alexandrova. Russia in 2015: purposes and priorities of development. UNDP report on development of human potential in Russia for 2005, p. 200.

*(42) Alexander Vylegzhanin, Issues of correlation and interaction of international relations and international law (Modern science of international relations abroad, ed. Ivanov, 2015, p. 426).