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applicant is effectively controlled by another State Party or its nationals, in
which event both States Parties shall sponsor the application. The criteria and
procedures for implementation of the sponsorship requirements shall be set
forth in the rules, regulations and procedures of the Authority.
4. The sponsoring State or States shall, pursuant to article 139, have the
responsibility to ensure, within their legal systems, that a contractor so
sponsored shall carry out activities in the Area in conformity with the terms
of its contract and its obligations under this Convention. A sponsoring State
shall not, however, be liable for damage caused by any failure of a contractor
sponsored by it to comply with its obligations if that State Party has adopted
laws and regulations and taken administrative measures which are, within the
framework of its legal system, reasonably appropriate for securing
compliance by persons under its jurisdiction.
5. The procedures for assessing the qualifications of States Parties
which are applicants shall take into account their character as States.
6. The qualification standards shall require that every applicant,
without exception, shall as part of his application undertake:
(a) to accept as enforceable and comply with the applicable
obligations created by the provisions of Part XI, the rules,
regulations and procedures of the Authority, the decisions of
the organs of the Authority and terms of his contracts with the
Authority;
(b) to accept control by the Authority of activities in the Area, as
authorized by this Convention;
(c) to provide the Authority with a written assurance that his
obligations under the contract will be fulfilled in good faith;
(d) to comply with the provisions on the transfer of technology set
forth in article 5 of this Annex.
Article 5
Transfer of technology
1. When submitting a plan of work, every applicant shall make
available to the Authority a general description of the equipment and methods
to be used in carrying out activities in the Area, and other relevant
non-proprietary information about the characteristics of such technology and
information as to where such technology is available.
2. Every operator shall inform the Authority of revisions in the
description and information made available pursuant to paragraph 1 whenever
a substantial technological change or innovation is introduced.
3. Every contract for carrying out activities in the Area shall contain the
following undertakings by the contractor:
(a) to make available to the Enterprise on fair and reasonable
commercial terms and conditions, whenever the Authority so
requests, the technology which he uses in carrying out activities
in the Area under the contract, which the contractor is legally
entitled to transfer. This shall be done by means of licences or
other appropriate arrangements which the contractor shall
negotiate with the Enterprise and which shall be set forth in a
specific agreement supplementary to the contract. This
undertaking may be invoked only if the Enterprise finds that it
is unable to obtain the same or equally efficient and useful
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