Russian Administration of the Northern Sea Route - Central or Regional

(By Yu. Ivanov, A. Yakovlev, A. Ushakov ; INSROP Working Paper No. 106 – 1998, IV.2.5)

The ultimate goal of this paper is to reveal the possible directions in development of the central and regional administrative bodies of the NSR under the conditions of political and economic reforms in Russia. In this connection, the paper first gives a brief analysis of the NSR management in Soviet times, current status of the NSR management and management of shipping practised by the foreign Arctic States.

A retrospective analysis of the NSR management in the Soviet period shows that successful accomplishment of the most difficult tasks in development of the NSR became feasible due to establishment of centralised management based on State ownership of all the NSR elements.

The uncontrolled process of privatisation (since 1991) of the shipping companies servicing the NSR broke the central management system of the NSR. Decisions of the RF government concerned basically particular matters of delivering goods to the North and did not set forth the principles of the NSR management under conditions of market relations. The legislative basis of the new administrative system of the NSR has been formed by the Constitution of the RF (1993) and the Decree of the president of the RF (1993) in conformity with which the ice-breaking, rescue and salvage and hydrographic fleet, port facilities, hydrographic bases, hydrometeorological service and means of radio communication are the Federal property. These objects will be managed centrally at all times.

The region administrative bodies of the NSR will be formed as the new finance and economic relations are introduced and traffic volume increases, with the active participation of the RF subjects and industrial enterprises in the Arctic. This is confirmed by foreign experience (Canada). The idea of founding a regional Arctic stock shipping company may become reality when the annual traffic volume through the NSR exceeds 20 m t and the rate of ice-breaking fee will be not more than 5 USD for 1 GRT. Under these conditions the Company may be profitable and renovated.

At all stages of the NSR development the State will retain the NSR as an integral national marine transport line meeting the internal and external interests of Russia. In compliance with the UN Convention on the Law of the Sea (Article 234), 1982, the State will adopt laws and rules concerning regulation of the Russian and international shipping along the NSR and marine environment protection.

Yu. Ivanov, A. Yakovlev, A. Ushakov, 1998, Russian Administration of the Northern Sea Route - Central or Regional, INSROP.©