Section 167p. 167

PUBLIC INTERNATIONAL LAW COMPENDIUM VOLUME I

Article 22. Responsibility

The contractor shall have responsibility or liability for any

damage arising out of wrongful acts in the conduct of its

operations, account being taken of contributory acts or

omissions by the Authority. Similarly, the Authority shall

have responsibility or liability for any damage arising out

of

wrongful

acts in the exercise of its powers and

functions,

including

violations

under

article

168,

paragraph 2, account being taken of contributory acts or

omissions by the contractor. Liability in every case shall be

for the actual amount of damage.

ANNEX IV. STATUTE OF THE ENTERPRISE

Article 1. Purposes

1. The Enterprise is the organ of the Authority which shall

carry out activities in the Area directly, pursuant to article

153,

paragraph

2

(a),

as

well

as

the

transporting,

processing and marketing of minerals recovered from the

Area.

2. In carrying out its purposes and in the exercise of its

functions, the Enterprise shall act in accordance with this

Convention and the rules, regulations and procedures of

the Authority.

3. In developing the resources of the Area pursuant to

paragraph

1,

the

Enterprise

shall,

subject

to

this

Convention,

operate

in

accordance

with

sound

commercial principles.

Article 2. Relationship to the Authority

1. Pursuant to article 170, the Enterprise shall act in

accordance with the general policies of the Assembly and

the directives of the Council.

2. Subject to paragraph l, the Enterprise shall enjoy

autonomy in the conduct of its operations.

3. Nothing in this Convention shall make the Enterprise

liable for the acts or obligations of the Authority, or make

the Authority liable for the acts or obligations of the

Enterprise.

Article 3. Limitation of liability

Without prejudice to article 11, paragraph 3, of this Annex,

no member of the Authority shall be liable by reason only

of its membership for the acts or obligations of the

Enterprise.

Article 4. Structure

The

Enterprise

shall

have

a

Governing

Board,

a

Director-General and the staff necessary for the exercise

of its functions.

Article 5. Governing Board

1. The Governing Board shall be composed of 15 members

elected by the Assembly in accordance with article 160,

paragraph 2(c). In the election of the members of the

Board, due regard shall be paid to the principle of

equitable

geographical

distribution.

In

submitting

nominations of candidates for election to the Board,

members of the Authority shall bear in mind the need to

nominate

candidates

of

the

highest

standard

of

competence, with qualifications in relevant fields, so as to

ensure the viability and success of the Enterprise.

2. Members of the Board shall be elected for four years

and may be re-elected; and due regard shall be paid to

the principle of rotation of membership.

3. Members of the Board shall continue in office until

their successors are elected. If the office of a member of

the

Board

becomes

vacant,

the

Assembly

shall,

in

accordance with article 160, paragraph 2(c), elect a new

member for the remainder of his predecessor's term.

4. Members of the Board shall act in their personal

capacity. In the performance of their duties they shall not

seek or receive instructions from any government or from

any other source. Each member of the Authority shall

respect the independent character of the members of

the Board and shall refrain from all attempts to influence

any of them in the discharge of their duties.

5. Each member of the Board shall receive remuneration

to be paid out of the funds of the Enterprise. The amount

of remuneration shall be fixed by the Assembly, upon the

recommendation of the Council.

6. The Board shall normally function at the principal office

of the Enterprise and shall meet as often as the business

of the Enterprise may require.

7. Two thirds of the members of the Board shall constitute

a quorum.

8. Each member of the Board shall have one vote. All

matters before the Board shall be decided by a majority

of its members. If a member has a conflict of interest on a

matter before the Board he shall refrain from voting on

that matter.

9. Any member of the Authority may ask the Board for

information in respect of its operations which particularly

affect that member. The Board shall endeavour to provide

such information.

Article 6. Powers and functions of the Governing Board

The Governing Board shall direct the operations of the

Enterprise. Subject to this Convention, the Governing

Board shall exercise the powers necessary to fulfil the

purposes of the Enterprise, including powers:

(a) to elect a Chairman from among its members;

(b) to adopt its rules of procedure;

(c) to draw up and submit formal written plans of work to

the Council in accordance with article 153, paragraph 3,

and article 162, paragraph 2(j);

(d) to develop plans of work and programmes for carrying

out the activities specified in article 170;

(e) to prepare and submit to the Council applications for

production authorizations in accordance with article 151,

paragraphs 2 to 7;

(f) to authorize negotiations concerning the acquisition of

technology, including those provided for in Annex III,

article 5, paragraph 3(a), (c) and (d), and to approve the

results of those negotiations;

(g) to establish terms and conditions, and to authorize

negotiations, concerning joint ventures and other forms

of joint arrangements referred to in Annex III, articles 9

and 11, and to approve the results of such negotiations;

(h) to recommend to the Assembly what portion of the

net income of the Enterprise should be retained as its

reserves in accordance with article 160, paragraph 2(f),

and article 10 of this Annex;

(i) to approve the annual budget of the Enterprise;

(j) to authorize the procurement of goods and services in

accordance with article 12, paragraph 3, of this Annex;

(k)

to

submit

an

annual

report

to

the

Council

in

accordance with article 9 of this Annex;

(l) to submit to the Council for the approval of the

Assembly

draft rules in respect of the organization,

management, appointment and dismissal of the staff of

the Enterprise and to adopt regulations to give effect to

such rules;

(m) to borrow funds and to furnish such collateral or other

security as it may determine in accordance with article 11,

paragraph 2, of this Annex;

(n) to enter into any legal proceedings, agreements and

transactions and to take any other actions in accordance

with article 13 of this Annex;

(o) to delegate, subject to the approval of the Council, any

non-discretionary powers to the Director-General and to

its committees.

Article 7. Director-General and staff of the Enterprise

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