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Time is ticking for high seas conservation

• Ratification of the BBNJ Agreement is moving fast - with 54 of the 60 States needed to be completed
• Likely to reach ratification threshold for adoption prior to PrepCom schedule completion
• Critical to define the financial mechanisms operation for BBNJ prior to the first Conference of the Parties, as without sufficient and equitable finance, the Agreement’s objectives of high seas conservation and sustainable use cannot be achieved.
• Steady progress made at PrepCom2 on the operationalisation of the BBNJ financial mechanism.  

In June 2023, the United Nations adopted a new treaty under the United Nations Convention on the Law of the Sea (UNCLOS), the Agreement on the Conservation and Sustainable Use of Marine Biological Diversity of Areas beyond National Jurisdiction (BBNJ). Also known as the High Seas Treaty, it is now on the verge of obtaining the 60 country ratifications required to bring it into force, with Saint Kitts and Nevis becoming the 54th State to ratify in August.

This treaty will create a comprehensive global framework for conserving and sustainably using marine biodiversity in the high seas–the roughly 60% of the global ocean that is currently outside any State’s jurisdiction.Ìý

It addresses a critical gap in international law that has allowed unregulated exploitation of high seas resources primarily by wealthy nations. It could also play a significant role in achieving the global target under the Kunming Montreal Global Biodiversity Framework to protect 30 per cent of the world's coastal and marine areas by 2030 - the 30 x 30 target.Ìý

With the BBNJ Agreement ratification threshold looming, States have started the process of operationalising the Agreement.Ìý The Preparatory Commission (PrepCom) brings together signatory States and other parties to outline what is needed to deliver on the BBNJ agreement. Three PrepCom meetings have been planned, PrepCom 1 happened in April, PrepCom2 finished last week, and the third is scheduled for March 2026.

The BBNJ Agreement will enter into force 120 days after the 60th ratification (Article 68 of the) - this ratification threshold will most likely be reached by January 2026.Ìý Meaning this will likely land before the final Preparatory Commission (PrepCom3) scheduled for March. Additionally, once the agreement comes into force, the first Conference of the Parties (CoP) has to happen within a year (Article 47) – this is where the critical decisions will be negotiated and adopted.Ìý Read more on the BBNJ ratification process.Ìý

With this in mind, and as the first COP looms, it is critical for States to start to operationalise the BBNJ Agreement’s financial mechanism –  to ensure developing States have access to the funding needed to make the Agreement a reality and respond to the urgency of high seas conservation.Ìý

At PrepCom2, States expressly emphasised the importance of all developing countries, and indigenous peoples and local communities having practical, equitable, and efficient access to funding under a well-funded financial mechanism. Without this, the BBNJ risks becoming another well-intentioned treaty that fails in implementation, unable to translate its ambitious goals into meaningful protection for the vast areas of ocean beyond national jurisdiction. This urgency framed the purpose and goals of PrepCom2.

What Progress was made on Finance?

Over the two weeks of PrepCom 2 during August in New York, delegates from more than 100 countries came together to lay the groundwork for the BBNJ Agreement's entry into force, with one goal being to further clarify the funding mechanism and financial arrangements.

The explicit purpose of the financial mechanism established in Article 52 of the Agreement is to provide "adequate, accessible, new and additional and predictable financial resources" to assist developing state parties in implementing the agreement, including through funding in support of capacity-building and the transfer of marine technology, and perform other functions for the conservation and sustainable use of marine biological diversity.Ìý

The financial mechanism is composed of three elements: the voluntary trust fund, the Special Fund, and a Global Environment Facility (GEF) trust fund. Discussions at PrepCom2 focused on the relationship between and management of how these would work when the BBNJ comes into force.Ìý

Financial discussion during Prep Com 2  focused on three main issues:

• How to create the Special Fund and the voluntary trust fund

• Cooperation and arrangements between the Global Environment Facility and the BBNJ.ÌýAgreement through a memorandum of understanding (MoU)

• Defining the financial rules of the Conference of the Parties (COP), Secretariat and Subsidiary Bodies.

The following sections outline some of these financial issues, how they were approached, and the progress made.Ìý

Cooperation with the Global Environment Facility (GEF)

To establish the GEF trust fund, the BBNJ Agreement will need to sign an agreement, called a memorandum of understanding (MoU), between the BBNJ COP and the GEF Council (the GEF’s operating entity). An MoU between the GEF and a multilateral environmental agreement (like the BBNJ Agreement) serves as the foundational instrument setting out the operational relationship and obligations between the GEF and the other agreement. Previous GEF MoUs have each followed a relatively harmonised format, each having a slightly different emphasis.

To start this process, the co-chairs at PrepCom1 had provided an initial GEF MoU for discussions, and now at PrepCom2 provided delegates with an updated version. Most of the discussions surrounded the BBNJ’s authority and relationship with the GEF Council, as certain States were concerned that the BBNJ COP would be overextending its authority and influence over the GEF Council. Especially when it came to issues such as, GEF reporting requirements, rights to appeal, access modalities, independent reviews, and, finally, on legal technical terms the appropriate legal language in the MoU.Ìý

Further, the GEF organises all of its funding around large four-year replenishment cycles, with GEF9 being the newest one planned for 2026-2030. The GEF has indicated that they would benefit from guidance on what GEF9 should fund, a possible prioritisation of activities, and possible ideas as to how much the GEF should allocate to BBNJ. The co-chairs had proposed a loose set of guidance, which could be included in their closing statement and sent to the GEF. However, due to some delegations having doubts about the PrepCom's competency to provide this guidance, and a lack of time to negotiate the guidance, currently, no guidance will be provided to the GEF.Ìý

The Special Fund and the Voluntary Trust Fund

The financial mechanism of the BBNJ Agreement, besides the GEF trust fund, has two additional funds: a voluntary trust fund and the Special Fund that will need to be created as soon as possible to begin supporting developing States. At the start of PrepCom2, States emphasised the timing challenge of needing a voluntary trust fund and the Special Fund to be operational as soon as possible, and the possible role of the Secretariat in providing interim fund support. Moreover, to continue this operationalisation process and in response to issues raised at PrepCom1, the co-chairs provided new foundational documents, including initial terms of reference for the voluntary trust fund and initial elements and timelines for the Special Fund.Ìý

The voluntary trust fund has been designated to facilitate the participation of representatives of developing States Parties, in particular least developed countries, landlocked developing countries and small island developing States, in the meetings of the bodies established under this Agreement. The fund is critical to ensure equitable access and participation by all States parties in the BBNJ Agreement and the COPs. The newly created draft terms of reference for the fund covered elements such as the eligibility and use of the fund, allocation of funds available, applications for financial assistance, how to consider these applications, a possible advisory board, and reporting.ÌýCurrently, an interim voluntary trust fund supports participation in the PrepCom process, which will most likely also be asked to provide support for the first COP, while waiting for the official new voluntary trust fund.Ìý

For the Special Fund, there were discussions on the importance of creating draft terms of reference, which focused on the role of the PrepCom and COP in the operationalisation process, focus areas, guiding principles, and possible operational timelines. Further, discussions during the conference emphasised the need to explore the possibility for developing states, indigenous peoples and local communities to have direct access to the funding, and the role of the GEF within the governance of the Special Fund.Ìý

COP Financial Rules 

The financial rules of the COP, the secretariat and the subsidiary bodies are being created to lay down the practical financial infrastructure of the BBNJ Agreement. The rules cover areas such as, the financial periods, budget, contributions, audits, and miscellaneous costs.Ìý

Discussions focused on the Financial rules for the COP, which were initially developed in PrepCom1 and now updated at PrepCom2. Discussions progressed on issues such as the role of the forthcoming financial committee, the importance and use of a working capital reserve, and the use of the UN scale of assessed contribution. However, there was significant disagreement on arrears provisions for parties unable or unwilling to pay their budgetary contributions.

Next Steps

In preparation for PrepCom3 and the imminent first COP,  States will need to consider the following items:

• Special Fund: to fully start the operationalisation process, a draft terms of reference will need to be created and finalised to not only operationalise the necessary timelines, but also start to create the necessary structures to set out how the fund will practically function.Ìý 

• COP Financial rules: the financial rules of the COP will be updated based on the PrepCom2 discussions, especially seeking to set out the different ways in which the future Secretariat of the BBNJ Agreement will be linked to the United Nations, impacting financial rules and costs.

• Voluntary Trust Fund: As a critical fund to support developing state parties' participation, it will be important for the Secretariat of the BBNJ Agreement to establish an interim fund to continue supporting delegations before the official new voluntary trust fund can be established at COP1. In setting up the new official fund, new draft terms of reference and coordination with the financial rules will be developed to establish how the fund will operate, and specifically, who will have access to funding.Ìý

• GEF MOU: The draft agreement with the GEF will be improved based on Parties' discussions at PrepCom2, and it is up to the Co-Chairs and the BBNJ bureau if they want to end up providing BBNJ guidance to the GEF in its GEF9 Replenishment.

There has also been a focus on the creation of the Special Fund, posing a truly unique opportunity to address well-documented access barriers and carve out an important role in offering pathways to finance that address the urgency of conservation and sustainable use of marine biological diversity in areas beyond national jurisdiction.

Advisory Group on BBNJ Finance

The University of New South Wales Centre for Sustainable Development Reform serves as the Secretariat to the  BBNJ Finance Advisory Group. The Advisory Group consists of global experts serving in their personal capacity to provide thought leadership on innovative financial mechanisms for the implementation of the BBNJ Agreement. The members bring together diverse geographical and gender perspectives and specialised knowledge in international finance, ocean governance, and environmental law.

All the research output briefs can be found on the website of the Centre for Sustainable Development Reform, listed on the BBNJ Advisory Group page.

Daniel Kachelriess, High Seas Alliance - Michai Robertson, AOSIS - Angelique Pouponneau, Advisory Group Co-Chair & AOSIS - on screen Taukondjo Shikongo, CBD Secretariat & Cali Fund