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| A panel in The Hague rejected Beijing’s claims to the South China Sea |
There was no legal basis for China to claim historic rights to resources
within the sea area enclosed by the nine-dash line as ruled by the
Permanent Court of Arbitration (PCA) in The Hague, the Netherlands.
The ruling was adopted on 12 July 2016 for the Philippines’s lawsuit against
China on a dispute in the the South China Sea.
On the day, the PCA also issued a press release on the case.
The following is the full text of the press release.
“THE SOUTH CHINA SEA ARBITRATION (THE REPUBLIC OF THE PHILIPPINES V. THE PEOPLE’S REPUBLIC OF CHINA)
The Hague, 12 July 2016
The Tribunal Renders Its Award
A unanimous Award has been issued today by the Tribunal constituted
under Annex VII to the United Nations Convention on the Law of the Sea
(the “Convention”) in the arbitration instituted by the Republic of the
Philippines against the People’s Republic of China.
This arbitration concerned the role of historic rights and the source of
maritime entitlements in the South China Sea, the status of certain
maritime features and the maritime entitlements they are capable of
generating, and the lawfulness of certain actions by China that were
alleged by the Philippines to violate the Convention. In light of
limitations on compulsory dispute settlement under the Convention, the
Tribunal has emphasized that it does not rule on any question of
sovereignty over land territory and does not delimit any boundary
between the Parties.
China has repeatedly stated that “it will neither accept nor participate
in the arbitration unilaterally initiated by the Philippines.” Annex
VII, however, provides that the “[a]bsence of a party or failure of a
party to defend its case shall not constitute a bar to the proceedings.”
Annex VII also provides that, in the event that a party does not
participate in the proceedings, a tribunal “must satisfy itself not only
that it has jurisdiction over the dispute but also that the claim is
well founded in fact and law.” Accordingly, throughout these
proceedings, the Tribunal has taken steps to test the accuracy of the
Philippines’ claims, including by requesting further written submissions
from the Philippines, by questioning the Philippines both prior to and
during two hearings, by appointing independent experts to report to the
Tribunal on technical matters, and by obtaining historical evidence
concerning features in the South China Sea and providing it to the
Parties for comment.
China has also made clear—through the publication of a Position Paper in
December 2014 and in other official statements—that, in its view, the
Tribunal lacks jurisdiction in this matter. Article 288 of the
Convention provides that: “In the event of a dispute as to whether a
court or tribunal has jurisdiction, the matter shall be settled by
decision of that court or tribunal.” Accordingly, the Tribunal convened a
hearing on jurisdiction and admissibility in July 2015 and rendered an
Award on Jurisdiction and Admissibility on 29 October 2015, deciding
some issues of jurisdiction and deferring others for further
consideration. The Tribunal then convened a hearing on the merits from
24 to 30 November 2015.
The Award of today’s date addresses the issues of jurisdiction not
decided in the Award on Jurisdiction and Admissibility and the merits of
the Philippines’ claims over which the Tribunal has jurisdiction. The
Award is final and binding, as set out in Article 296 of the Convention
and Article 11 of Annex VII.
Historic Rights and the ‘Nine-Dash Line’:
The Tribunal found that it has
jurisdiction to consider the Parties’ dispute concerning historic
rights and the source of maritime entitlements in the South China Sea.
On the merits, the Tribunal concluded that the Convention
comprehensively allocates rights to maritime areas and that protections
for pre-existing rights to resources were considered, but not adopted in
the Convention. Accordingly, the Tribunal concluded that, to the extent
China had historic rights to resources in the waters of the South China
Sea, such rights were extinguished to the extent they were incompatible
with the exclusive economic zones provided for in the Convention. The
Tribunal also noted that, although Chinese navigators and fishermen, as
well as those of other States, had historically made use of the islands
in the South China Sea, there was no evidence that China had
historically exercised exclusive control over the waters or their
resources. The Tribunal concluded that there was no legal basis for
China to claim historic rights to resources within the sea areas falling
within the ‘nine-dash line’.
Status of Features:
The Tribunal next considered entitlements to
maritime areas and the status of features. The Tribunal first undertook
an evaluation of whether certain reefs claimed by China are above water
at high tide. Features that are above water at high tide generate an
entitlement to at least a 12 nautical mile territorial sea, whereas
features that are submerged at high tide do not. The Tribunal noted that
the reefs have been heavily modified by land reclamation and
construction, recalled that the Convention classifies features on their
natural condition, and relied on historical materials in evaluating the
features. The Tribunal then considered whether any of the features
claimed by China could generate maritime zones beyond 12 nautical miles.
Under the Convention, islands generate an exclusive economic zone of
200 nautical miles and a continental shelf, but “[r]ocks which cannot
sustain human habitation or economic life of their own shall have no
exclusive economic zone or continental shelf.” The Tribunal concluded
that this provision depends upon the objective capacity of a feature, in
its natural condition, to sustain either a stable community of people
or economic activity that is not dependent on outside resources or
purely extractive in nature. The Tribunal noted that the current
presence of official personnel on many of the features is dependent on
outside support and not reflective of the capacity of the features. The
Tribunal found historical evidence to be more relevant and noted that
the Spratly Islands were historically used by small groups of fishermen
and that several Japanese fishing and guano mining enterprises were
attempted. The Tribunal concluded that such transient use does not
constitute inhabitation by a stable community and that all of the
historical economic activity had been extractive. Accordingly, the
Tribunal concluded that none of the Spratly Islands is capable of
generating extended maritime zones. The Tribunal also held that the
Spratly Islands cannot generate maritime zones collectively as a unit.
Having found that none of the features claimed by China was capable of
generating an exclusive economic zone, the Tribunal found that it
could—without delimiting a boundary—declare that certain sea areas are
within the exclusive economic zone of the Philippines, because those
areas are not overlapped by any possible entitlement of China.
Lawfulness of Chinese Actions:
The Tribunal next considered the
lawfulness of Chinese actions in the South China Sea. Having found that
certain areas are within the exclusive economic zone of the Philippines,
the Tribunal found that China had violated the Philippines’ sovereign
rights in its exclusive economic zone by (a) interfering with Philippine
fishing and petroleum exploration, (b) constructing artificial islands
and (c) failing to prevent Chinese fishermen from fishing in the zone.
The Tribunal also held that fishermen from the Philippines (like those
from China) had traditional fishing rights at Scarborough Shoal and that
China had interfered with these rights in restricting access. The
Tribunal further held that Chinese law enforcement vessels had
unlawfully created a serious risk of collision when they physically
obstructed Philippine vessels.
Harm to Marine Environment:
The Tribunal considered the effect on the
marine environment of China’s recent large-scale land reclamation and
construction of artificial islands at seven features in the Spratly
Islands and found that China had caused severe harm to the coral reef
environment and violated its obligation to preserve and protect fragile
ecosystems and the habitat of depleted, threatened, or endangered
species. The Tribunal also found that Chinese authorities were aware
that Chinese fishermen have harvested endangered sea turtles, coral, and
giant clams on a substantial scale in the South China Sea (using
methods that inflict severe damage on the coral reef environment) and
had not fulfilled their obligations to stop such activities.
Aggravation of Dispute:
Finally, the Tribunal considered whether China’s
actions since the commencement of the arbitration had aggravated the
dispute between the Parties. The Tribunal found that it lacked
jurisdiction to consider the implications of a stand-off between
Philippine marines and Chinese naval and law enforcement vessels at
Second Thomas Shoal, holding that this dispute involved military
activities and was therefore excluded from compulsory settlement. The
Tribunal found, however, that China’s recent large-scale land
reclamation and construction of artificial islands was incompatible with
the obligations on a State during dispute resolution proceedings,
insofar as China has inflicted irreparable harm to the marine
environment, built a large artificial island in the Philippines’
exclusive economic zone, and destroyed evidence of the natural condition
of features in the South China Sea that formed part of the Parties’
dispute.
An expanded summary of the Tribunal’s decisions is set out below.
The Tribunal was constituted on 21 June 2013 pursuant to the procedure
set out in Annex VII of the Convention to decide the dispute presented
by the Philippines. The Tribunal is composed of Judge Thomas A. Mensah
of Ghana, Judge Jean-Pierre Cot of France, Judge Stanislaw Pawlak of
Poland, Professor Alfred H.A. Soons of the Netherlands, and Judge
Rüdiger Wolfrum of Germany. Judge Thomas A. Mensah serves as President
of the Tribunal. The Permanent Court of Arbitration acts as the Registry
in the proceedings.
Further information about the case may be found at
www.pcacases.com/web/view/7, including the Award on Jurisdiction and
Admissibility, the Rules of Procedure, earlier Press Releases, hearing
transcripts, and photographs. Procedural Orders, submissions by the
Philippines, and reports by the Tribunal’s experts will be made
available in due course, as will unofficial Chinese translations of the
Tribunal’s Awards.
Background to the Permanent Court of Arbitration
The Permanent Court of Arbitration (PCA) is an intergovernmental
organization established by the 1899 Hague Convention on the Pacific
Settlement of International Disputes. The PCA has 121 Member States.
Headquartered at the Peace Palace in The Hague, the Netherlands, the PCA
facilitates arbitration, conciliation, fact-finding, and other dispute
resolution proceedings among various combinations of States, State
entities, intergovernmental organizations, and private parties. The
PCA’s International Bureau is currently administering 8 interstate
disputes, 73 investor-State arbitrations, and 34 cases arising under
contracts involving a State or other public entity. The PCA has
administered 12 cases initiated by States under Annex VII to the United
Nations Convention on the Law of the Sea.
In July 2013, the Tribunal in the South China Sea Arbitration appointed
the PCA to serve as Registry for the proceedings. The Tribunal’s Rules
of Procedure provide that the PCA shall “maintain an archive of the
arbitral proceedings and provide appropriate registry services as
directed by the Arbitral Tribunal.” Such services include assisting with
the identification and appointment of experts; publishing information
about the arbitration and issuing press releases; organizing the
hearings at the Peace Palace in The Hague; and the financial management
of the case, which involves holding a deposit for expenses in the
arbitration, such as to pay arbitrator fees, experts, technical support,
court reporters etc. The Registry also serves as the channel of
communications amongst the Parties and the Tribunal and observer States.
SUMMARY OF THE TRIBUNAL’S DECISIONS ON ITS JURISDICTION AND ON THE MERITS OF THE PHILIPPINES’ CLAIMS
1. Background to the Arbitration
The South China Sea Arbitration between the Philippines and China
concerned an application by the Philippines for rulings in respect of
four matters concerning the relationship between the Philippines and
China in the South China Sea. First, the Philippines sought a ruling on
the source of the Parties’ rights and obligations in the South China Sea
and the effect of the United Nations Convention on the Law of the Sea
(“Convention”) on China’s claims to historic rights within its so-called
‘nine-dash line’. Second, the Philippines sought a ruling on whether
certain maritime features claimed by both China and the Philippines are
properly characterized as islands, rocks, low-tide elevations or
submerged banks under the Convention. The status of these features under
the Convention determines the maritime zones they are capable of
generating. Third, the Philippines sought rulings on whether certain
Chinese actions in the South China Sea have violated the Convention, by
interfering with the exercise of the Philippines’ sovereign rights and
freedoms under the Convention or through construction and fishing
activities that have harmed the marine environment. Finally, the
Philippines sought a ruling that certain actions taken by China, in
particular its large-scale land reclamation and construction of
artificial islands in the Spratly Islands since this arbitration was
commenced, have unlawfully aggravated and extended the Parties’ dispute.
The Chinese Government has adhered to the position of neither accepting
nor participating in these arbitral proceedings. It has reiterated this
position in diplomatic notes, in the “Position Paper of the Government
of the People’s Republic of China on the Matter of Jurisdiction in the
South China Sea Arbitration Initiated by the Republic of the
Philippines” dated 7 December 2014 (“China’s Position Paper”), in
letters to members of the Tribunal from the Chinese Ambassador to the
Kingdom of the Netherlands, and in many public statements. The Chinese
Government has also made clear that these statements and documents
“shall by no means be interpreted as China’s participation in the
arbitral proceeding in any form.”
Two provisions of the Convention address the situation of a party that
objects to the jurisdiction of a tribunal and declines to participate in
the proceedings:
(a) Article 288 of the Convention provides that: “In the event of a
dispute as to whether a court or tribunal has jurisdiction, the matter
shall be settled by decision of that court or tribunal.”
(b) Article 9 of Annex VII to the Convention provides that:
If one of the parties to the dispute does not appear before the arbitral
tribunal or fails to defend its case, the other party may request the
tribunal to continue the proceedings and to make its award. Absence of a
party or failure of a party to defend its case shall not constitute a
bar to the proceedings. Before making its award, the arbitral tribunal
must satisfy itself not only that it has jurisdiction over the dispute
but also that the claim is well founded in fact and law.
Throughout these proceedings, the Tribunal has taken a number of steps
to fulfil its duty to satisfy itself as to whether it has jurisdiction
and whether the Philippines’ claims are “well founded in fact and law”.
With respect to jurisdiction, the Tribunal decided to treat China’s
informal communications as equivalent to an objection to jurisdiction,
convened a Hearing on Jurisdiction and Admissibility on 7 to 13 July
2015, questioned the Philippines both before and during the hearing on
matters of jurisdiction, including potential issues not raised in
China’s informal communications, and issued an Award on Jurisdiction and
Admissibility on 29 October 2015 (the “Award on Jurisdiction”),
deciding some issues of jurisdiction and deferring others for further
consideration in conjunction with the merits of the Philippines’ claims.
With respect to the merits, the Tribunal sought to test the accuracy of
the Philippines’ claims by requesting further written submissions from
the Philippines, by convening a hearing on the merits from 24 to 30
November 2015, by questioning the Philippines both before and during the
hearing with respect to its claims, by appointing independent experts
to report to the Tribunal on technical matters, and by obtaining
historical records and hydrographic survey data for the South China Sea
from the archives of the United Kingdom Hydrographic Office, the
National Library of France, and the French National Overseas Archives
and providing it to the Parties for comment, along with other relevant
materials in the public domain.
2. The Parties’ Positions
The Philippines made 15 Submissions in these proceedings, requesting the Tribunal to find that:
(1) China’s maritime entitlements in the South China Sea, like those of
the Philippines, may not extend beyond those expressly permitted by the
United Nations Convention on the Law of the Sea;
(2) China’s claims to sovereign rights 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 effect to the extent that they exceed the
geographic and substantive limits of China’s maritime entitlements
expressly permitted by UNCLOS;
(3) Scarborough Shoal generates no entitlement to an exclusive economic zone or continental shelf;
(4) Mischief Reef, Second Thomas Shoal, and Subi Reef are low-tide
elevations that do not generate entitlement to a territorial sea,
exclusive economic zone or continental shelf, and are not features that
are capable of appropriation by occupation or otherwise;
(5) Mischief Reef and Second Thomas Shoal are part of the exclusive economic zone and continental shelf of the Philippines;
(6) Gaven Reef and McKennan Reef (including Hughes Reef) are low-tide
elevations that do not generate entitlement to a territorial sea,
exclusive economic zone or continental shelf, but their low-water line
may be used to determine the baseline from which the breadth of the
territorial sea of Namyit and Sin Cowe, respectively, is measured;
(7) Johnson Reef, Cuarteron Reef and Fiery Cross Reef generate no
entitlement to an exclusive economic zone or continental shelf;
(8) China has unlawfully interfered with the enjoyment and exercise of
the sovereign rights of the Philippines with respect to the living and
non-living resources of its exclusive economic zone and continental
shelf;
(9) China has unlawfully failed to prevent its nationals and vessels
from exploiting the living resources in the exclusive economic zone of
the Philippines; (10) China has unlawfully prevented Philippine
fishermen from pursuing their livelihoods by interfering with
traditional fishing activities at Scarborough Shoal; (11) China has
violated its obligations under the Convention to protect and preserve
the marine environment at Scarborough Shoal, Second Thomas Shoal,
Cuarteron Reef, Fiery Cross Reef, Gaven Reef, Johnson Reef, Hughes Reef
and Subi Reef;
(12) China’s occupation of and construction activities on Mischief Reef
(a) violate the provisions of the Convention concerning artificial
islands, installations and structures; (b) violate China’s duties to
protect and preserve the marine environment under the Convention; and
(c) constitute unlawful acts of attempted appropriation in violation of
the Convention;
(13) China has breached its obligations under the Convention by
operating its law enforcement vessels in a dangerous manner, causing
serious risk of collision to Philippine vessels navigating in the
vicinity of Scarborough Shoal;
(14) Since the commencement of this arbitration in January 2013, China
has unlawfully aggravated and extended the dispute by, among other
things: (a) interfering with the Philippines’ rights of navigation in
the waters at, and adjacent to, Second Thomas Shoal; (b) preventing the
rotation and resupply of Philippine personnel stationed at Second Thomas
Shoal; (c) endangering the health and well-being of Philippine
personnel stationed at Second Thomas Shoal; and (d) conducting dredging,
artificial island-building and construction activities at Mischief
Reef, Cuarteron Reef, Fiery Cross Reef, Gaven Reef, Johnson Reef, Hughes
Reef and Subi Reef; and
(15) China shall respect the rights and freedoms of the Philippines
under the Convention, shall comply with its duties under the Convention,
including those relevant to the protection and preservation of the
marine environment in the South China Sea, and shall exercise its rights
and freedoms in the South China Sea with due regard to those of the
Philippines under the Convention.
With respect to jurisdiction, the Philippines has asked the Tribunal to
declare that the Philippines’ claims “are entirely within its
jurisdiction and are fully admissible.” China does not accept and is not
participating in this arbitration but stated its position that the
Tribunal “does not have jurisdiction over this case.” In its Position
Paper, China advanced the following arguments:
- The essence of the subject-matter of the arbitration is the
territorial sovereignty over several maritime features in the South
China Sea, which is beyond the scope of the Convention and does not
concern the interpretation or application of the Convention;
- China and the Philippines have agreed, through bilateral instruments
and the Declaration on the Conduct of Parties in the South China Sea, to
settle their relevant disputes through negotiations. By unilaterally
initiating the present arbitration, the Philippines has breached its
obligation under international law;
- Even assuming, arguendo, that the subject-matter of the arbitration
were concerned with the interpretation or application of the Convention,
that subject-matter would constitute an integral part of maritime
delimitation between the two countries, thus falling within the scope of
the declaration filed by China in 2006 in accordance with the
Convention, which excludes, inter alia, disputes concerning maritime
delimitation from compulsory arbitration and other compulsory dispute
settlement procedures;
Although China has not made equivalent public statements with respect to
the merits of the majority of the Philippines’ claims, the Tribunal has
sought throughout the proceedings to ascertain China’s position on the
basis of its contemporaneous public statements and diplomatic
correspondence.
3. The Tribunal’s Decisions on the Scope of its Jurisdiction
The Tribunal has addressed the scope of its jurisdiction to consider the
Philippines’ claims both in its Award on Jurisdiction, to the extent
that issues of jurisdiction could be decided as a preliminary matter,
and in its Award of 12 July 2016, to the extent that issues of
jurisdiction were intertwined with the merits of the Philippines’
claims. The Tribunal’s Award of 12 July 2016 also incorporates and
reaffirms the decisions on jurisdiction taken in the Award on
Jurisdiction. For completeness, the Tribunal’s decisions on jurisdiction
in both awards are summarized here together.
a. Preliminary Matters
In its Award on Jurisdiction, the Tribunal considered a number of
preliminary matters with respect to its jurisdiction. The Tribunal noted
that both the Philippines and China are parties to the Convention and
that the Convention does not permit a State to except itself generally
from the mechanism for the resolution of disputes set out in the
Convention. The Tribunal held that China’s non-participation does not
deprive the Tribunal of jurisdiction and that the Tribunal had been
properly constituted pursuant to the provisions of Annex VII to the
Convention, which include a procedure to form a tribunal even in the
absence of one party. Finally, the Tribunal rejected an argument set out
in China’s Position Paper and held that the mere act of unilaterally
initiating an arbitration cannot constitute an abuse of the Convention.
b. Existence of a Dispute Concerning Interpretation and Application of the Convention
In its Award on Jurisdiction, the Tribunal considered whether the
Parties’ disputes concerned the interpretation or application of the
Convention, which is a requirement for resort to the dispute settlement
mechanisms of the Convention.
The Tribunal rejected the argument set out in China’s Position Paper
that the Parties’ dispute is actually about territorial sovereignty and
therefore not a matter concerning the Convention. The Tribunal accepted
that there is a dispute between the Parties concerning sovereignty over
islands in the South China Sea, but held that the matters submitted to
arbitration by the Philippines do not concern sovereignty. The Tribunal
considered that it would not need to implicitly decide sovereignty to
address the Philippines’ Submissions and that doing so would not advance
the sovereignty claims of either Party to islands in the South China
Sea.
The Tribunal also rejected the argument set out in China’s Position
Paper that the Parties’ dispute is actually about maritime boundary
delimitation and therefore excluded from dispute settlement by Article
298 of the Convention and a declaration that China made on 25 August
2006 pursuant to that Article. The Tribunal noted that a dispute
concerning whether a State has an entitlement to a maritime zone is a
distinct matter from the delimitation of maritime zones in an area in
which they overlap. The Tribunal noted that entitlements, together with a
wide variety of other issues, are commonly considered in a boundary
delimitation, but can also arise in other contexts. The Tribunal held
that it does not follow that a dispute over each of these issues is
necessarily a dispute over boundary delimitation.
Finally, the Tribunal held that each of the Philippines’ Submissions
reflected a dispute concerning the Convention. In doing so, the Tribunal
emphasized (a) that a dispute concerning the interaction between the
Convention and other rights (including any Chinese “historic rights”) is
a dispute concerning the Convention and (b) that where China has not
clearly stated its position, the existence of a dispute may be inferred
from the conduct of a State or from silence and is a matter to be
determined objectively.
c. Involvement of Indispensable Third-Parties
In its Award on Jurisdiction, the Tribunal considered whether the
absence from this arbitration of other States that have made claims to
the islands of the South China Sea would be a bar to the Tribunal’s
jurisdiction. The Tribunal noted that the rights of other States would
not form “the very subject-matter of the decision,” the standard for a
third-party to be indispensable. The Tribunal further noted that in
December 2014, Viet Nam had submitted a statement to the Tribunal, in
which Viet Nam asserted that it has “no doubt that the Tribunal has
jurisdiction in these proceedings.” The Tribunal also noted that Viet
Nam, Malaysia, and Indonesia had attended the hearing on jurisdiction as
observers, without any State raising the argument that its
participation was indispensable.
In its Award of 12 July 2016, the Tribunal noted that it had received a
communication from Malaysia on 23 June 2016, recalling Malaysia’s claims
in the South China Sea. The Tribunal compared its decisions on the
merits of the Philippines’ Submissions with the rights claimed by
Malaysia and reaffirmed its decision that Malaysia is not an
indispensable party and that Malaysia’s interests in the South China Sea
do not prevent the Tribunal from addressing the Philippines’
Submissions.
d. Preconditions to Jurisdiction
In its Award on Jurisdiction, the Tribunal considered the applicability
of Articles 281 and 282 of the Convention, which may prevent a State
from making use of the mechanisms under the Convention if they have
already agreed to another means of dispute resolution.
The Tribunal rejected the argument set out in China’s Position Paper
that the 2002 China–ASEAN Declaration on the Conduct of Parties in the
South China Sea prevented the Philippines from initiating arbitration.
The Tribunal held that the Declaration is a political agreement and not
legally binding, does not provide a mechanism for binding settlement,
does not exclude other means of dispute settlement, and therefore does
not restrict the Tribunal’s jurisdiction under Articles 281 or 282. The
Tribunal also considered the Treaty of Amity and Cooperation in
Southeast Asia, and the Convention on Biological Diversity, and a series
of joint statements issued by the Philippines and China referring to
the resolution of disputes through negotiations and concluded that none
of these instruments constitute an agreement that would prevent the
Philippines from bringing its claims to arbitration.
The Tribunal further held that the Parties had exchanged views regarding
the settlement of their disputes, as required by Article 283 of the
Convention, before the Philippines initiated the arbitration. The
Tribunal concluded that this requirement was met in the record of
diplomatic communications between the Philippines and China, in which
the Philippines expressed a clear preference for multilateral
negotiations involving the other States surrounding the South China Sea,
while China insisted that only bilateral talks could be considered.
e. Exceptions and Limitations to Jurisdiction
In its Award of 12 July 2016, the Tribunal considered whether the
Philippines’ Submissions concerning Chinese historic rights and the
‘nine-dash line’ were affected by the exception from jurisdiction for
disputes concerning “historic title” in Article 298 of the Convention.
The Tribunal reviewed the meaning of “historic title” in the law of the
sea and held that this refers to claims of historic sovereignty over
bays and other near-shore waters. Reviewing China’s claims and conduct
in the South China Sea, the Tribunal concluded that China claims
historic rights to resources within the ‘nine-dash line’, but does not
claim historic title over the waters of the South China Sea.
Accordingly, the Tribunal concluded that it had jurisdiction to consider
the Philippines’ claims concerning historic rights and, as between the
Philippines and China, the ‘nine-dash line’
.
In its Award of 12 July 2016, the Tribunal also considered whether the
Philippines’ Submissions were affected by the exception from
jurisdiction in Article 298 for disputes concerning sea boundary
delimitation. The Tribunal had already found in its Award on
Jurisdiction that the Philippines’ Submissions do not concern boundary
delimitation as such, but noted that several of the Philippines’
Submissions were dependent on certain areas forming part of the
Philippines’ exclusive economic zone. The Tribunal held that it could
only address such submissions if there was no possibility that China
could have an entitlement to an exclusive economic zone overlapping that
of the Philippines and deferred a final decision on its jurisdiction.
In its Award of 12 July 2016, the Tribunal reviewed evidence about the
reefs and islands claimed by China in the South China Sea and concluded
that none is capable of generating an entitlement to an exclusive
economic zone. Because China has no possible entitlement to an exclusive
economic zone overlapping that of the Philippines in the Spratly
Islands, the Tribunal held that the Philippines’ submissions were not
dependent on a prior delimitation of a boundary. In its Award of 12 July
2016, the Tribunal also considered whether the Philippines’ Submissions
were affected by the exception from jurisdiction in Article 298 for
disputes concerning law enforcement activities in the exclusive economic
zone. The Tribunal recalled that the exception in Article 298 would
apply only if the Philippines’ Submissions related to law enforcement
activities in China’s exclusive economic zone. Because, however, the
Philippines’ Submissions related to events in the Philippines’ own
exclusive economic zone or in the territorial sea, the Tribunal
concluded that Article 298 did not pose an obstacle to its jurisdiction.
Lastly, in its Award of 12 July 2016, the Tribunal considered whether
the Philippines’ submissions were affected by the exception from
jurisdiction in Article 298 for disputes concerning military activities.
The Tribunal considered that the stand-off between Philippine marines
on Second Thomas Shoal and Chinese naval and law enforcement vessels
constituted military activities and concluded that it lacked
jurisdiction over the Philippines’ Submission No. 14(a)-(c). The
Tribunal also considered whether China’s land reclamation and
construction of artificial islands at seven features in the Spratly
Islands constituted military activities, but noted that China had
repeatedly emphasized the non-military nature of its actions and had
stated at the highest level that it would not militarize its presence in
the Spratlys. The Tribunal decided that it would not deem activities to
be military in nature when China itself had repeatedly affirmed the
opposite. Accordingly, the Tribunal concluded that Article 298 did not
pose an obstacle to its jurisdiction.
4. The Tribunal’s Decisions on the Merits of the Philippines’ Claims
a. The ‘Nine-Dash Line’ and China’s Claim to Historic Rights in the Maritime Areas of the South China Sea
In its Award of 12 July 2016, the Tribunal considered the implications
of China’s ‘nine-dash line’ and whether China has historic rights to
resources in the South China Sea beyond the limits of the maritime zones
that it is entitled to pursuant to the Convention. The Tribunal
examined the history of the Convention and its provisions concerning
maritime zones and concluded that the Convention was intended to
comprehensively allocate the rights of States to maritime areas. The
Tribunal noted that the question of pre-existing rights to resources (in
particular fishing resources) was carefully considered during the
negotiations on the creation of the exclusive economic zone and that a
number of States wished to preserve historic fishing rights in the new
zone. This position was rejected, however, and the final text of the
Convention gives other States only a limited right of access to
fisheries in the exclusive economic zone (in the event the coastal State
cannot harvest the full allowable catch) and no rights to petroleum or
mineral resources. The Tribunal found that China’s claim to historic
rights to resources was incompatible with the detailed allocation of
rights and maritime zones in the Convention and concluded that, to the
extent China had historic rights to resources in the waters of the South
China Sea, such rights were extinguished by the entry into force of the
Convention to the extent they were incompatible with the Convention’s
system of maritime zones.
The Tribunal also examined the historical record to determine whether
China actually had historic rights to resources in the South China Sea
prior to the entry into force of the Convention. The Tribunal noted that
there is evidence that Chinese navigators and fishermen, as well as
those of other States, had historically made use of the islands in the
South China Sea, although the Tribunal emphasized that it was not
empowered to decide the question of sovereignty over the islands.
However, the Tribunal considered that prior to the Convention, the
waters of the South China Sea beyond the territorial sea were legally
part of the high seas, in which vessels from any State could freely
navigate and fish.
Accordingly, the Tribunal concluded that historical navigation and
fishing by China in the waters of the South China Sea represented the
exercise of high seas freedoms, rather than a historic right, and that
there was no evidence that China had historically exercised exclusive
control over the waters of the South China Sea or prevented other States
from exploiting their resources.
Accordingly, the Tribunal concluded that, as between the Philippines and
China, there was no legal basis for China to claim historic rights to
resources, in excess of the rights provided for by the Convention,
within the sea areas falling within the ‘nine-dash line’.
b. The Status of Features in the South China Sea
In its Award of 12 July 2016, the Tribunal considered the status of
features in the South China Sea and the entitlements to maritime areas
that China could potentially claim pursuant to the Convention.
The Tribunal first undertook a technical evaluation as to whether
certain coral reefs claimed by China are or are not above water at high
tide. Under Articles 13 and 121 of the Convention, features that are
above water at high tide generate an entitlement to at least a 12
nautical mile territorial sea, whereas features that are submerged at
high tide generate no entitlement to maritime zones. The Tribunal noted
that many of the reefs in the South China Sea have been heavily modified
by recent land reclamation and construction and recalled that the
Convention classifies features on the basis of their natural condition.
The Tribunal appointed an expert hydrographer to assist it in evaluating
the Philippines’ technical evidence and relied heavily on archival
materials and historical hydrographic surveys in evaluating the
features. The Tribunal agreed with the Philippines that Scarborough
Shoal, Johnson Reef, Cuarteron Reef, and Fiery Cross Reef are high-tide
features and that Subi Reef, Hughes Reef, Mischief Reef, and Second
Thomas Shoal were submerged at high tide in their natural condition.
However, the Tribunal disagreed with the Philippines regarding the
status of Gaven Reef (North) and McKennan Reef and concluded that both
are high tide features.
The Tribunal then considered whether any of the features claimed by
China could generate an entitlement to maritime zones beyond 12 nautical
miles. Under Article 121 of the Convention, islands generate an
entitlement to an exclusive economic zone of 200 nautical miles and to a
continental shelf, but “[r]ocks which cannot sustain human habitation
or economic life of their own shall have no exclusive economic zone or
continental shelf.” The Tribunal noted that this provision was closely
linked to the expansion of coastal State jurisdiction with the creation
of the exclusive economic zone and was intended to prevent insignificant
features from generating large entitlements to maritime zones that
would infringe on the entitlements of inhabited territory or on the high
seas and the area of the seabed reserved for the common heritage of
mankind. The Tribunal interpreted Article 121 and concluded that the
entitlements of a feature depend on (a) the objective capacity of a
feature, (b) in its natural condition, to sustain either (c) a stable
community of people or (d) economic activity that is neither dependent
on outside resources nor purely extractive in nature.
The Tribunal noted that many of the features in the Spratly Islands are
currently controlled by one or another of the littoral States, which
have constructed installations and maintain personnel there. The
Tribunal considered these modern presences to be dependent on outside
resources and support and noted that many of the features have been
modified to improve their habitability, including through land
reclamation and the construction of infrastructure such as desalination
plants. The Tribunal concluded that the current presence of official
personnel on many of the features does not establish their capacity, in
their natural condition, to sustain a stable community of people and
considered that historical evidence of habitation or economic life was
more relevant to the objective capacity of the features. Examining the
historical record, the Tribunal noted that the Spratly Islands were
historically used by small groups of fishermen from China, as well as
other States, and that several Japanese fishing and guano mining
enterprises were attempted in the 1920s and 1930s. The Tribunal
concluded that temporary use of the features by fishermen did not amount
to inhabitation by a stable community and that all of the historical
economic activity had been extractive in nature. Accordingly, the
Tribunal concluded that all of the high-tide features in the Spratly
Islands (including, for example, Itu Aba, Thitu, West York Island,
Spratly Island, North-East Cay, South-West Cay) are legally “rocks” that
do not generate an exclusive economic zone or continental shelf.
The Tribunal also held that the Convention does not provide for a group
of islands such as the Spratly Islands to generate maritime zones
collectively as a unit.
c. Chinese Activities in the South China Sea
In its Award of 12 July 2016, the Tribunal considered the lawfulness
under the Convention of various Chinese actions in the South China Sea.
Having found that Mischief Reef, Second Thomas Shoal and Reed Bank are
submerged at high tide, form part of the exclusive economic zone and
continental shelf of the Philippines, and are not overlapped by any
possible entitlement of China, the Tribunal concluded that the
Convention is clear in allocating sovereign rights to the Philippines
with respect to sea areas in its exclusive economic zone. The Tribunal
found as a matter of fact that China had (a) interfered with Philippine
petroleum exploration at Reed Bank, (b) purported to prohibit fishing by
Philippine vessels within the Philippines’ exclusive economic zone, (c)
protected and failed to prevent Chinese fishermen from fishing within
the Philippines’ exclusive economic zone at Mischief Reef and Second
Thomas Shoal, and (d) constructed installations and artificial islands
at Mischief Reef without the authorization of the Philippines. The
Tribunal therefore concluded that China had violated the Philippines’
sovereign rights with respect to its exclusive economic zone and
continental shelf.
The Tribunal next examined traditional fishing at Scarborough Shoal and
concluded that fishermen from the Philippines, as well as fishermen from
China and other countries, had long fished at the Shoal and had
traditional fishing rights in the area. Because Scarborough Shoal is
above water at high tide, it generates an entitlement to a territorial
sea, its surrounding waters do not form part of the exclusive economic
zone, and traditional fishing rights were not extinguished by the
Convention. Although the Tribunal emphasized that it was not deciding
sovereignty over Scarborough Shoal, it found that China had violated its
duty to respect to the traditional fishing rights of Philippine
fishermen by halting access to the Shoal after May 2012. The Tribunal
noted, however, that it would reach the same conclusion with respect to
the traditional fishing rights of Chinese fishermen if the Philippines
were to prevent fishing by Chinese nationals at Scarborough Shoal.
The Tribunal also considered the effect of China’s actions on the marine
environment. In doing so, the Tribunal was assisted by three
independent experts on coral reef biology who were appointed to assist
it in evaluating the available scientific evidence and the Philippines’
expert reports. The Tribunal found that China’s recent large scale land
reclamation and construction of artificial islands at seven features in
the Spratly Islands has caused severe harm to the coral reef environment
and that China has violated its obligation under Articles 192 and 194
of the Convention to preserve and protect the marine environment with
respect to fragile ecosystems and the habitat of depleted, threatened,
or endangered species. The Tribunal also found that Chinese fishermen
have engaged in the harvesting of endangered sea turtles, coral, and
giant clams on a substantial scale in the South China Sea, using methods
that inflict severe damage on the coral reef environment. The Tribunal
found that Chinese authorities were aware of these activities and failed
to fulfill their due diligence obligations under the Convention to stop
them.
Finally, the Tribunal considered the lawfulness of the conduct of
Chinese law enforcement vessels at Scarborough Shoal on two occasions in
April and May 2012 when Chinese vessels had sought to physically
obstruct Philippine vessels from approaching or gaining entrance to the
Shoal. In doing so, the Tribunal was assisted by an independent expert
on navigational safety who was appointed to assist it in reviewing the
written reports provided by the officers of the Philippine vessels and
the expert evidence on navigational safety provided by the Philippines.
The Tribunal found that Chinese law enforcement vessels had repeatedly
approached the Philippine vessels at high speed and sought to cross
ahead of them at close distances, creating serious risk of collision and
danger to Philippine ships and personnel. The Tribunal concluded that
China had breached its obligations under the Convention on the
International Regulations for Preventing Collisions at Sea, 1972, and
Article 94 the Convention concerning maritime safety.
d. Aggravation of the Dispute between the Parties
In its Award of 12 July 2016, the Tribunal considered whether China’s
recent large-scale land reclamation and construction of artificial
islands at seven features in the Spratly Islands since the commencement
of the arbitration had aggravated the dispute between the Parties. The
Tribunal recalled that there exists a duty on parties engaged in a
dispute settlement procedure to refrain from aggravating or extending
the dispute or disputes at issue during the pendency of the settlement
process. The Tribunal noted that China has (a) built a large artificial
island on Mischief Reef, a low-tide elevation located in the exclusive
economic zone of the Philippines; (b) caused permanent, irreparable harm
to the coral reef ecosystem and (c) permanently destroyed evidence of
the natural condition of the features in question. The Tribunal
concluded that China had violated its obligations to refrain from
aggravating or extending the Parties’ disputes during the pendency of
the settlement process.
e. Future Conduct of the Parties
Finally, the Tribunal considered the Philippines’ request for a
declaration that, going forward, China shall respect the rights and
freedoms of the Philippines and comply with its duties under the
Convention. In this respect, the Tribunal noted that both the
Philippines and China have repeatedly accepted that the Convention and
general obligations of good faith define and regulate their conduct. The
Tribunal considered that the root of the disputes at issue in this
arbitration lies not in any intention on the part of China or the
Philippines to infringe on the legal rights of the other, but rather in
fundamentally different understandings of their respective rights under
the Convention in the waters of the South China Sea. The Tribunal
recalled that it is a fundamental principle of international law that
bad faith is not presumed and noted that Article 11 of Annex VII
provides that the “award . . . shall be complied with by the parties to
the dispute.” The Tribunal therefore considered that no further
declaration was necessary.”
