Seabed Minerals Amendment passed unanimously in Parliament

Prime Minister Brown speaking on the Seabed Minerals Amendment Bill 2021

The Seabed Minerals Amendment Bill 2021 passed in Parliament on Tuesday 23 March receiving unanimous support from both Government and the Opposition.

The purpose of the amendment was simple and straightforward: to make clear that only Cook Islands limited companies may apply for a seabed minerals licence or permit.

One of the four applications received by the Seabed Minerals Authority (Authority) was by a Limited Liability Company (LLC), whilst the other three applicants were Cook Islands registered companies. An LLC has special rules and some exemptions to the requirements that a Cook Islands limited company would have to follow.

While the intent of the Seabed Minerals Act 2019 (Act) was clear, there was some potential ambiguity in certain provisions, which could allow an LLC to apply. The 2021 amendment has tightened those provisions to prevent that.

Addressing the house, Prime Minister Mark Brown said to allow an LLC to apply for and hold a licence would create an uneven playing field, as it would potentially mean that an LLC would not have to comply with certain tax and reporting requirements. “We cannot allow that” he said.

Prime Minister Brown said that the amendment “sent a message to companies wanting to operate in our waters that they have to play by the rules, and that we will not hesitate to take action if we perceive that any company is trying to take advantage of possible loopholes.”

He added, “It also sends a message to our people and the wider community that again we take our role as ocean stewards seriously.”

“We are building a world leading seabed minerals sector based on best principles and practices, with an effective, robust legal framework, to benefit the Cook Islands and our people,” said Prime Minister Brown.

The Leader of the Opposition Tina Browne also supported the amendment.

Both leaders spoke about the exploration phase which the country was about to enter through the current licensing process.

Prime Minister Brown remarked, “As we enter the Exploration phase, the Government will continue to proceed with caution, taking actions based on the best available science, to manage our seabed mineral resources, while ensuring that the marine environment is protected.”

Opposition leader Browne shared similar sentiments noting, “The Opposition’s approach to exploration is consistent with the policy that Government has adopted. It makes sense to the Opposition that if we are going to collect data to enable us at some later stage determine as to whether we enter into the second phase, then we need to do that very carefully, and be very sensitive about our environment.”

Seabed Minerals Commissioner Alex Herman shared that the applicant had been notified of the requirement to resubmit their application as a Cook Islands limited company, and given a short grace period by which to comply.

The Authority is currently processing the exploration licence applications, and will be sharing updates on progress shortly.

Queries relating to this release may be directed to Dede Mingi ([email protected]).