A Netherlands flagged vessel, the Arctic Sunrise, was in the exclusive economic zone of the Russian Federation. Russian authorities detained the vessel and the 30 people onboard. The vessel was subsequently towed to the port of Murmansk. The Netherlands instituted proceedings under Annex VII to the United Nations Convention on the Law of the Sea 1982 (UNCLOS) requesting that an arbitral tribunal be constituted under Annex VII to adjudge and declare that the boarding and detention of the Arctic Sunrise constituted a breach by the Russian Federation of arts 58.1 and 87.1.a of UNCLOS and customary international law. The Netherlands contended that the sovereign rights of a coastal state in maritime areas beyond its territorial sea were resource-oriented and limited in scope. Additionally, as the exercise of jurisdiction to protect these sovereign rights was functional, the law of the sea restricted the right of a coastal state to exercise jurisdiction in these areas. Accordingly, a coastal state could not unilaterally extend such sovereign rights.

On 21 October 2013, the Netherlands filed with the tribunal a request for the prescription of provisional measures under art 290.5 of UNCLOS to require the Russian Federation to release the Arctic Sunrise, to suspend all judicial and administrative proceedings, and ensure that no other action was taken which might aggravate or extend the dispute, pending the constitution of the arbitral tribunal under Annex VII to UNCLOS. The Russian Federation indicated that it did not intend to participate in the proceedings of the tribunal concerning this request as it was entitled to inspect the vessel in accordance with rules of international law but stressed its readiness to continue to seek a mutually acceptable solution to this situation. The Netherlands requested the tribunal to continue the proceedings and make its decision on the request for provisional measures despite the non-appearance of the Russian Federation pursuant to art 28 of the Statute of the Tribunal. The Netherlands argued that prescription of provisional measures was urgent as the vessel required intensive maintenance and was at risk of perishing and that continued detention of the crew would have irreversible consequences.

There were several issues for the tribunal’s consideration in this request. First, whether the non-appearance of the Russian Federation constituted a bar to the proceedings to preclude the tribunal from prescribing provisional measures. Second, whether the Annex VII arbitral tribunal had prima facie jurisdiction. Third, whether the tribunal could prescribe a bond or other financial security as a provisional measure for the release of the vessel and the persons detained. Fourth, what were the provisional measures that the tribunal should prescribe.

Held: The tribunal decided (by 19 votes to 2) to prescribe the provisional measures under art 290.5 of UNCLOS to oblige the Russian Federation to release immediately the vessel Arctic Sunrise and all persons who had been detained, upon the posting of a bond or other financial security with the Russian Federation in the form of a bank guarantee by the Netherlands which should be in the amount of EUR 3,600,000; and that, upon such posting of security, the Russian Federation should ensure that the vessel Arctic Sunrise and all detained persons were allowed to leave the territory and maritime areas under the jurisdiction of the Russian Federation. Additionally, the Netherlands and the Russian Federation were each to submit a report and information on compliance with any prescribed provisional measures to the tribunal.

On the first issue, the non-appearance of the Russian Federation and failure to defend its case did not constitute a bar to the proceedings. The prescription of provisional measures must observe the principle of equality and consider the procedural rights of both parties where the absence of a party may hinder the regular conduct of the proceedings and affect the good administration of justice. The Russian Federation was given ample opportunity to present its observations but declined to do so. The Netherlands should not be put at a disadvantage because of the non-appearance of the Russian Federation in the proceedings. Hence, the Russian Federation was a party to the proceedings with ensuing rights and obligations and the tribunal was not precluded from prescribing provisional measures.

On the second issue, the tribunal had to satisfy itself that the Annex VII arbitral tribunal would have prima facie jurisdiction before provisional measures under art 290.5 of UNCLOS could be prescribed. The Netherlands invoked art 288.1 of UNCLOS as the basis of jurisdiction, which reads: ‘A court or tribunal referred to in art 287 shall have jurisdiction over any dispute concerning the interpretation or application of this Convention which is submitted to it in accordance with this Part.’ A dispute existed between these two states concerning the interpretation or application of UNCLOS on the difference of opinion as to the applicability of its provisions concerning the rights and obligations of a flag state and a coastal state on arts 56, 58, 60, 87 and 110 of UNCLOS even though the tribunal was not called upon to establish definitively the existence of the rights claimed by the Netherlands at this stage. Golitsyn J dissented on this point, suggesting that the obligation to exchange views under art 283.1 of UNCLOS was not met. However, the tribunal was of the view that the requirements of art 283 were satisfied as the Netherlands and Russian Federation had been exchanging diplomatic notes and other official correspondence, and there had been discussions between the respective Ministers of Foreign Affairs. Since the Netherlands had concluded that the possibilities of reaching agreement were exhausted, it was no longer obliged to continue with an exchange of views. This was supported by the declaration of Anderson J (judge ad hoc) that the emphasis was more upon the expression of views regarding the most appropriate peaceful means of settlement, rather than the exhaustion of diplomatic negotiations over the substantive issues dividing the parties. The main purpose of art 283 is to avoid the situation whereby a state is taken completely by surprise by the institution of proceedings against it. These provisions of UNCLOS invoked by the Netherlands afforded a basis on which the jurisdiction of the arbitral tribunal might be founded. The tribunal found that the Annex VII arbitral tribunal has prima facie jurisdiction over the dispute and accordingly, provisional measures under art 290.5 of UNCLOS could be prescribed.

On the third issue, the tribunal could prescribe a bond or other financial security pending the constitution of the Annex VII arbitral tribunal as a provisional measure for the release of the vessel and the persons detained so long as it considered that the urgency of the situation so requires (art 290.5 of UNCLOS). Upon considering the circumstances of the present case, the tribunal considered that the situation was urgent, requiring the prescription of provisional measures. Golitsyn J dissented, suggesting that assigning respective responsibilities to competent Russian authorities would provide sufficient guarantees that the Arctic Sunrise would be properly maintained and would not ‘perish’.

On the fourth issue, reading art 290.5 in conjunction with art 290.1 of UNCLOS allows the tribunal to prescribe any provisional measures, which it considers appropriate under the circumstances, to preserve the respective rights of the parties to the dispute or to prevent serious harm to the marine environment, pending the final decision. Additionally, the tribunal might prescribe measures different in whole or in part from those requested (art 89.5 of the Rules of the Tribunal). The Annex VII arbitral tribunal, once constituted, may modify, revoke or affirm any provisional measures prescribed by the Tribunal (art 290.5 of UNCLOS). The tribunal considered the respective rights claimed by the parties and the particular circumstances of the case and determined that it was appropriate to order that the Arctic Sunrise and all persons who had been detained in connection with the present dispute be released upon the posting of a bond or other financial security in the amount of EUR 3,600,000 in the form of a bank guarantee, by the Netherlands, issued by a bank in the Russian Federation or a bank having corresponding arrangements with a Russian bank. In addition, the tribunal decided that the vessel and the persons were allowed to leave the territory and maritime areas under the jurisdiction of the Russian Federation.