Introduction

The blue economy – set of economic activities linked to the oceans, seas and coastal areas- has consolidated as one of the main expansion frontiers of the global economy. Maritime transport, international trade, fisheries and aquaculture,  offshore energy, coastal tourism, marine biotechnology and, increasingly, deep-sea mining form a productive network of systemic relevance today.

Various international organizations have pointed out that, in aggregate terms, the ocean could be equivalent to the size of one of the world’s leading economies in terms of added value and assets. Recent projections indicate that this relative weight will continue to expand towards 2030 and 2050, driven by the energy transition, the demand for critical minerals and the sustained growth of maritime trade (OECD, 2016; OECD, recent projections).

This economic dynamism contrasts with an obvious lag in the applicable tax frameworks and their tax collection reflection. The current international tax architecture – built on territorial notions, source and physical presence – shows increasing difficulties to tax highly mobile activities, conducted offshore and, particularly, on global commons.

This phenomenon is not unique to this economy. Previously[1], I have analyzed similar challenges in relation to the taxation of the “outer space economy”, another thriving economy developed outside the classic territorial sovereignty of states (Porporatto, 2025). In both cases, the absence of a clearly identifiable source State strains the traditional principles of international taxation and exposes increasing risks of non-taxation. The blue economy, particularly in maritime areas beyond national jurisdictions, confirms and deepens this diagnosis.

The “blue” economic dimension.

The economic relevance of ocean activities is reflected both in international trade and in the generation of employment. According to recent estimates, trade linked to the blue economy reached approximately USD 2.2 trillion in 2023, representing about 7% of global trade in goods and services (UNCTAD, 2025).

The OECD identifies sectors with growth rates higher than the global average, such as offshore wind energy, industrial aquaculture, fishery product processing, advanced maritime services and marine biotechnology (OECD, 2016; OECD, 2025). At the same time, it is estimated that more than 3 billion people depend directly or indirectly on the oceans for their livelihood, with a particular impact on developing countries and small island States (World Bank, 2024).

These data confirm that the blue economy has ceased to be a marginal or sectoral phenomenon to become a structural component of global economic growth, with tax implications that can no longer be ignored.

International legal framework: limited sovereignty and global commons.

From the legal point of view, the blue economy develops on a unique architecture defined by the United Nations Convention on the Law of the Sea (UNCLOS). This instrument distinguishes between:

• • Areas under national jurisdiction, in particular the Exclusive Economic Zone (EEZ), where States exercise sovereign rights for the exploration and exploitation of natural resources.
• • “The Area”, comprising the seabed beyond national jurisdictions, classified as the common heritage of mankind and administered by the International Seabed Authority (ISA).

This distinction is central to the tax analysis. While in the EEZ the States retain tax powers derived from their sovereign rights, on the high seas, taxation is diluted, favoring the State of residence and exposing risks of non-taxation. In this regard, it should be noted that in “The Area” the collection of income would be articulated through international financial mechanisms, such as royalties or participation schemes administered at a supranational level (United Nations, 1982; ISA/CIAT, 2022).

Empirical evidence on taxation of ocean activities

Recent evidence indicates that tax revenues explicitly classified by the OECD as linked to ocean sustainability represented only 0.02% of total tax revenues, despite the growth of the ocean economy. This figure illustrates the magnitude of the gap between the economic value generated by ocean activities and the explicit fiscal capture allowed by the current tax system.

Likewise, studies on the taxation of sustainable fisheries in international waters show that national tax rules generate disparate and even inequitable treatments between operators and States, due to the difficulty of assigning source and residence in transboundary activities. These conclusions reinforce the idea that the problem does not lie exclusively in evasion or non-compliance, but in the tax design itself (González et al., 2021).

Other studies analyze the use of tax exemptions and subsidies in blue economy policies, highlighting that, while they can promote sustainable investments, they also generate risks of distortion and harmful tax competition if not coordinated internationally. (Silva & Pereira, 2022).

Likewise, research on the maritime industry shows that special tax regimes – such as the tonnage tax[2] or flags of convenience- have a decisive influence on the location of investments and the adoption of green technologies, with direct implications for the global tax base (Zhang et al., 2023).

International taxation and limits of tax conventions

For their part, the OECD and United Nations Model Tax Treaties were designed for a predominantly land-based economy. Although some treaties extend the concept of territory to the continental shelf or the EEZ, its scope is limited to areas under state jurisdiction.

At least three structural tensions emerge in the context of the blue economy:

1. Tax loopholes in international waters, where the tax power is diluted or concentrated exclusively in the State of residence.
2. Insufficiency of the concept of Permanent Establishment, in the face of capital-intensive activities that operate using mobile platforms or specialized vessels.
3. International fragmentation of the value chain, which facilitates aggressive tax planning and the erosion of tax bases.

These tensions reproduce, in an almost symmetrical way, the challenges identified in the outer space economy. This reinforces the conclusion that national and even traditional bilateral frameworks are insufficient to tax economies based on global commons.

The Blue Economy in Latin America.

In Latin America, the blue economy acquires a particular relevance. The region concentrates some of the most extensive EEZs in the world and a high economic, social and fiscal dependence on ocean resources. Countries such as Argentina, Brazil, Chile and Mexico exercise sovereign rights over millions of square kilometers of maritime spaces, where key activities for international trade, food security and the energy transition are developed.

However, this economic relevance does not translate proportionally into tax collection. Various regional studies show structural tax undercollection in ocean activities,  the offshore operations and the widespread use of special regimes. In the fisheries sector, for example, illegal, unreported and unregulated fishing generates significant economic and fiscal losses in several countries in the region.

In international maritime transport, the use of flags of convenience and regimes such as the tonnage tax substantially reduce the effective taxation of operators that obtain significant income linked to Latin American routes and ports. Similarly, in emerging sectors such as  offshore energy, some countries have opted for extensive incentive schemes and tax exemptions aimed at promoting investment, with potential impacts on the medium-term tax base.

These challenges reproduce, on a regional scale, the structural limits of the international tax system and its possibilities of control against economies deployed beyond the traditional terrestrial territory.

At the same time, the region is starting to explore innovative instruments, such as the issuance of blue bonds, the debate on environmental taxes linked to maritime transport and the use of digital technologies (e.g. the integration of satellite data AIS – Automatic Identification System– with the databases of the tax administrations to monitor in real time the exploitation in the EEZ, also the Internet of things, blockchain, etc.) for the control and traceability of activities in the EEZ. However, these efforts remain fragmented and require greater levels of regional coordination[3] and international to avoid new forms of harmful tax competition (IDB, 2024).

Mining in deep waters.

Deep-sea mining is a paradigmatic case of a blue economy developed on global commons. A single project may require initial investments exceeding USD 2,000 million, with significant technological, financial and environmental risks.

The International Seabed Authority (ISA, 2025) makes progress on “equalization measures”: options such as royalty additional 8% (hybrid) or profit share 25%, creditable against payments to the sponsoring state, to equalize rates with land-based mining. Although there would be greater support for the profit share, everything is under negotiation. This approach would seek to ensure a fair participation in the benefits derived from the common heritage of humanity and avoid competitive distortions with terrestrial mining (ISA/CIAT, 2022; Tilot et al., 2018).

The experience of underwater mining positions the blue economy as a veritable laboratory for international taxation, with lessons potentially applicable to other frontier economies, including the outer space economy.

Towards a comprehensive blue agenda.

The blue economy represents an opportunity for a historical convergence of great economic opportunities, environmental sustainability, food security and, ultimately, global social cohesion.

This economy shows that one of the main tax challenges of the 21st century is not to tax new activities, but to tax activities that no longer recognize clear territorial borders. Like the spatial economy, it shows the limits of an international tax system designed for a state-centric world.

Empirical evidence shows that fiscal under-capture in ocean activities is not accidental, but structural. In the absence of coherent and coordinated fiscal frameworks, the predominant risk is not double taxation, but non-taxation. Also, in the region, EEZs are relevant for some States, which require revision of tax treatment and strengthening of control practices, which necessarily lead to the incorporation of new technologies and resort to international cooperation.

In this context, moving towards a blue agenda, integrated with international, environmental and natural resources taxation, is not an isolated chapter, but a necessary step in the adaptation of the global tax system to the frontier economies of the XXI century. In this process, Latin America is not only a region that receives challenges, but also a strategic laboratory for the design of innovative tax solutions with global potential.

Bibliography consulted

• • Inter-American Development Bank (IDB). (2024). Blue economy in Latin America and the Caribbean: opportunities, challenges and public policies.
• • González, J., Martín, L., & Pérez, A. (2021). Taxation of sustainable fisheries in international waters. Revista Española de Economía y Administración Pública.
• • International Seabed Authority -ISA- (2025). Council 30th Session: Equalization Measures. International Seabed Authority.
• • ISA & CIAT. (2022). Issues Paper on Taxation and Deep Seabed Mining.
• • United Nations. (1982). United Nations Convention on the Law of the Sea.
• (• 2016). The Ocean Economy in 2030. OECD Publishing.
• (• 2025). The Ocean Economy to 2050. OECD Publishing.
• • Porporatto, P. A. (2025). Taxation of the space economy: the final frontier. CIAT Blog.
• • Silva, R., & Pereira, M. (2022). Tax incentives and subsidies in the blue economy. Ocean & Coastal Research.
• • Tilot, V., et al. (2018). Deep-sea mining: governance and fiscal frameworks. Marine Policy.
• • (2025). World Trade Update: Sustainable Ocean Economy.
• • World Bank. (2024). PROBLUE Annual Report.

References:

[1] The complete posting: https://www.ciat.org/ciatblog-tributacion-de-la-economia-del-espacio-la-ultima-frontera/

[2] Tonnage tax is a special tax regime applied to international shipping companies, which replaces the conventional corporate income tax.

[3] These issues could be included in the Tax Platform for Latin America and the Caribbean (PTLAC in Spanish).