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Development and Settlement of Disputes, The South China Sea Arbitration: the Republic of Philippines vs. the People's Republic of China

The South China Sea dispute and the Philippines Arbitration Tribunal: China’s policy options

Mincai Yu

Australian Journal of International Affairs

Volume 70, Issue 3, 2016


The Philippines Arbitration Tribunal separately dealing with the jurisdiction over the South China Sea dispute is the continuance of the set practice by the United Nations Convention on the Law of the Sea’s Annex VII arbitral tribunals of bifurcation of proceedings, and was the best option for it to deal with China’s objections to its jurisdiction in the circumstance of China’s non-acceptance of and non-participation in the arbitral proceedings. Such a measure has potentially important implications for the tribunal itself and for China. The tribunal’s decision to have jurisdiction over some parts of the Philippines’ submissions resumed the merits proceedings of the dispute. This development of the proceedings would force China to reconsider its current policy of non-participation. Participation in the subsequent merits proceedings might be the right choice for China.


The following is an excerpt from the article in which the author discusses China’s future policy options for the next proceedings and impacts on China itself with its non-participation policy. As written in the Introduction part, the article consists of six parts, based on an empirical analysis of UNCLOS and the practice of UNCLOS Annex VII arbitral tribunals and other international courts given the fact that the principles and jurisprudence stated by the ICJ are directly relevant to the Annex VII arbitration (The Philippines Arbitration Tribunal 2015, 23). Following the introduction, the second part explores the practice of an Annex VII arbitral tribunal bifurcating the jurisdiction from the merits of a dispute. The third part describes the reasons why the tribunal dealt with the jurisdictional issue separately, and the fourth section examines the implications of the tribunal’s move for itself and for China. The fifth part discusses China’s future policy options for a later stage of the proceedings before the article ends with some concluding comments.

China’s future policy options for the next proceedings

The Philippines Arbitration Tribunal (2015, 149) rendered its award on jurisdiction on October 29, 2015, unanimously deciding that it has jurisdiction to consider the Philippines’ Submissions No. 3, 4, 6, 7, 10, 11 and 13, respectively, concerning the status of Scarborough Shoal, Johnson Reef, Cuarteron Reef and Fiery Cross Reef as an island or a rock; the status of Mischief Reef, Second Thomas Shoal, Subi Reef, Gaven Reef and McKennan Reef as low-tide elevations; the traditional fishing activities of Philippine nationals; and China’s law enforcement activities—thus continuing its merits phase in late November of the year 2015. This would logically force China to reconsider its non-participation policy because the tribunal’s decision will legally eliminate China’s obstacles to participation. One option available for China could be to take part in the next stage of the proceedings. China itself has stated that it respects the competence of judicial or arbitral bodies in deciding the jurisdictional dispute endowed by Article 288 (4) (PRC 2014). This seems to imply that China would respect the tribunal’s positive decision on jurisdiction based on its full respect for ‘the right of the States Parties to the Convention to choose the means of dispute settlement of their own accord’ (ibid.), and could change its stance. In some defaulting cases, non-participating respondent states have participated anew in merits proceedings after the ICJ adjudicated that it had jurisdiction at the jurisdictional proceedings (see Table 2).

However, China rejected the tribunal’s award by declaring that it is null and void, and has no binding effect (PRC’s MFA 2015a). This indicates that China would maintain its current policy of non-participation for the tribunal’s merits proceedings. There are instances where respondent states have not engaged in the whole proceedings in international legal practice (see Tables 1 and 2). The most recent case is Russia’s continual refusal to participate in the merits proceedings after the Arctic Sunrise Arbitration Tribunal (2015, 2) found itself to have jurisdiction.

China’s continual non-participation might not be a wise option. First, China would lose the opportunity to defend itself once again. In the award, the consideration of jurisdiction over the Philippines’ Submissions No. 1, 2, 5, 8, 9, 12 and 14 is reserved for the merits phase (The Philippines Arbitration Tribunal 2015, 149). China would have legitimate arguments to keep questioning the tribunal’s jurisdiction over them. The Philippines’ Submission No. 1—that China’s maritime entitlements in the South China Sea, like those of the Philippines, may not extend beyond those permitted by UNCLOS (ibid., 34)—should not constitute a dispute, because China has never opposed the Philippines’ claims to maritime entitlements in the South China Sea under its Archipelagic Baselines Law of 2009 (PRC 2014). Similarly, the Philippines’ Submission No. 2

[that] China’s claims to sovereign rights and jurisdiction, and to ‘historic rights’, with respect to the maritime areas of the South China Sea encompassed by the so-called ‘nine-dash line’ are contrary to the Convention and without lawful effects to the extent that they exceed the geographic and substantive limits of China’s maritime entitlements under UNCLOS (The Philippines Arbitration Tribunal 2015, 34).

should also not form a dispute, as there has been no compelling evidence that China regards the ‘nine-dash line’ as the basis of asserting its maritime entitlements in the South China Sea. Such evidence cannot be presumed as a ‘nine-dash line’ map contained in China’s 2009 communication on the Malaysia-Vietnam joint submission of the limits of the outer continental shelf in the southern part of the South China Sea to the Commission on the Limits of the Continental Shelf, in which China simply stated that it ‘has indisputable sovereignty over the islands in the South China Sea and the adjacent waters, and enjoys sovereign rights and jurisdiction over the relevant waters as well as the seabed and subsoil thereof’ (PRC 2009). China consistently maintains the principle that ‘the land dominates the sea’ (PRC’s MFA 2013). In a note responding to a counter-protest by the Philippines on April 14, 2011 to a Chinese diplomatic note of May 7, 2009, China countered that, under the relevant provisions of UNCLOS, as well as the law of the People’s Republic of China on the Territorial Sea and the Contiguous Zone (1992) and the Law on the Exclusive Economic Zone and the Continental Shelf of the People’s Republic of China (1998), ‘China’s Nansha Islands is fully entitled to territorial sea, exclusive economic zone and Continental Shelf’ (The Permanent Mission of the PRC 2011). The ‘Prescott line’, depicted by Australian geographer Victor Prescott, geographically regards the Spratly Islands as a group that can generate its own maritime zones (Valencia, Van Dyke, and Ludwig 1997, 205). Consequently, the tribunal should not be required to rule on whether it has jurisdiction over these submissions of the Philippines (Award 2015, 139).

The Philippines’ Submission No. 2, together with Submissions No. 5, 8 and 12 concerning Mischief Reef and Second Thomas Shoal being part of the Philippines’ exclusive economic zone and continental shelf, and Chinese activities in regard to petroleum exploration and construction on Mischief Reef (The Philippines Arbitration Tribunal 2015, 34–35), still actually implies that China is not a ‘coastal state’ in the South China Sea for the purpose of UNCLOS. But the interpretation of the term ‘coastal state’ by the tribunal will necessarily turn on the question of who has sovereignty over the disputed islands and reefs in the South China Sea (The United Kingdom 2012, 22). The Philippines’ Submissions No. 3 and 7, in respect of Huangyan Island (Scarborough Shoal), Johnson Reef, Cuarteron Reef and Fiery Cross Reef, which are not islands but rocks generating no entitlement to an exclusive economic zone or continental shelf under UNCLOS Article 121 (The Philippines Arbitration Tribunal 2015, 34), are really a mixed dispute involving the disputed islands and reefs, because China argued that the very essence of the Philippines’ submissions is ‘the territorial sovereignty over certain maritime features in the South China Sea’ being ‘cunningly packaged’, which is supported by international jurisprudence (Mincai 2014, 10–11; PRC 2014).

Surely, a mixed dispute is not fully precluded by an Article 298 (1) declaration. The Chagos Marine Protected Area Arbitration Tribunal pointed out that it ‘does not categorically exclude that in some instances a minor issue of territorial sovereignty could indeed be ancillary to a dispute concerning the interpretation or application of the Convention’, so that it ‘might be within the jurisdiction of a Part XV court or tribunal’ (Award 2015, 90). The ITLOS judge and Philippines’ arbitrator Wolfrum (2006) even said that

[i]ssues of sovereignty or other rights over continental or insular land territory, which are closely linked or ancillary to maritime delimitation, concern the interpretation or application of the Convention and therefore fall within … the compulsory jurisdiction of the Tribunal, or any other court or tribunal.

The Philippines’ counsel Professor Boyle (1997, 44) also recognised that there is no bar to a court or tribunal under Part XV dealing with the question of entitlement to claim an exclusive economic zone where there is a ‘land … dispute’. However, if the central thrust of the applicant’s claim is to seek determination of a long-standing dispute over territorial sovereignty, but there is also an issue of maritime entitlement, then a Part XV court or tribunal has no jurisdiction over it. This was the jurisprudence of the Chagos Marine Protected Area Arbitration Tribunal, which dismissed Mauritius’s Submissions 1 and 2 with respect to whether the UK or Mauritius was the ‘coastal state’ for the purposes of UNCLOS, stating that the ‘real issue in the case’ and the ‘object of the claim’ was a dispute by both parties over sovereignty of the Chagos Archipelago, and an incidental connection between it and some matter regulated by UNCLOS was insufficient to bring it, as a whole, within the ambit of Article 288 (1) (Award 2015, 87–90).

The above-mentioned Philippines’ submissions have as their principal object the question of sovereignty over the disputed islands and reefs. It is well known that the Philippines has been disputing China’s claims over certain islands and reefs in the South China Sea since the 1970s (PRC 2014). In contrast, prior to the initiation of the arbitral proceedings, there had been scant evidence that the Philippines was specifically concerned with the question of maritime entitlements generated by the disputed islands and reefs.2 Even in the course of the proceedings, the Philippines has asserted the dispute as one over sovereignty in a variety of forums. One of the latest pieces of evidence is reportedly the Philippines submitting to the tribunal in June 2015 an almost 300-year-old map of the Philippines, showing the disputed Scarborough Shoal being part of Philippine territory, in order to question China’s territorial claim over the South China Sea (Tordesillas 2015). Another is that the Philippines’ Secretary of Foreign Affairs, Rosario (2015), accused China, before five arbitrators of the tribunal, of using a ‘salami-slicing’ strategy to eat into Philippines territory and to consolidate its hold over disputed waters. It follows that the differing views of both parties on whether the maritime features should be characterised as rocks or islands within UNCLOS Article 121 are incidental to the Philippines’ underlying sovereignty dispute. The determination sought by the Philippines would effectively constitute a finding that China has no sovereignty over the disputed islands and reefs. As the parties’ sovereignty dispute does not concern the interpretation or application of UNCLOS, the tribunal should accordingly be without jurisdiction to address the aforementioned Philippines’ submissions (Award 2015, 90).

Second, China itself might be subject to much more criticism and significant political pressure from the international community. The tribunal (2015, 40) stressed that ‘China is a Party to the arbitration and is bound under international law by any awards rendered by this Tribunal’. Much earlier, before the issuance of the award, international opinion expressed the expectation that both the Philippines and China would honour the tribunal’s decision on jurisdiction (G7 2015). China’s non-acceptance of it may well be regarded as defying an international tribunal’s order. More importantly, China’s continual nonparticipation would not affect the validity of a final award against it (UNCLOS 1982, Annex VII, Article 11; Mincai 2015, 66–67) and would not exempt it from equally bearing the expense of the tribunal with the Philippines (UNCLOS 1982, Annex VII, Article 7). If China declined to implement an unfavourable ruling, not only would the South China Sea situation become more complicated than ever before, but China would also pay a heavy political price by being branded as an international outlaw and as a state that does not respect and comply with international law, gravely damaging its international reputation as a responsible actor in the international community and directly jeopardising its position as an adherent of international law (Patterson 2014, 1245).

Actually, this happened to the USA following its absence from the merits proceedings of the Nicaragua case, where the ICJ judged that the USA was under an obligation to make reparations to Nicaragua for all injury caused to Nicaragua by certain breaches of obligations under customary international law and treaty law committed by the USA (ICJ 1986, 146–149). The United Nations General Assembly ([1986], 1987, 1988, and 1989) adopted successive four-year resolutions calling on the USA for the immediate revocation of the trade embargo against Nicaragua, which was contrary to the ICJ’s judgment, and full and immediate compliance with the judgment, despite the USA’s veto of a resolution proposed on the subject in the United Nations Security Council (Security Council 1986). Indeed, in the case of the South China Sea situation, one commentator has suggested that the Philippines could take the South China Sea matter up before the United Nations General Assembly in order to seek the issuance of a resolution condemning China for its illegal use of force against Philippine vessels (Romero 2015).

Read the full article at http://www.tandfonline.com/doi/pdf/10.1080/10357718.2015.1135869



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