UNCLOS ruling may ease China-South-east Asia tensions

Analysis

The case was initiated by Manila against Beijing in 2013 over the latter's claims and conduct in the South China Sea. The tribunal's 15 findings can be grouped into three areas:

No 'historic rights'

The tribunal found that UNCLOS is the only legal basis for maritime rights claims, so that China cannot legally claim rights beyond those provided for in the Convention.

China has consistently maintained a claim to 'historic rights', which it says pre-date UNCLOS's creation in 1982. The tribunal held that UNCLOS extinguished and superseded all pre-existing maritime rights claims.

This was a strong rejection of any interpretation of the 'nine-dash line' map as marking Chinese territory. Such an expansive reading of the line's meaning has never been officially stated policy, but Chinese maritime agencies have often acted as though that were the case.

Rocks versus islands

The tribunal ruled on the legal status (but not the sovereignty) of the disputed maritime features of the Spratly archipelago, as well as of the Scarborough Shoal further to the north.

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It provided the first definition of the criteria that distinguish 'islands', which are entitled to 200-nautical-mile Exclusive Economic Zone (EEZ) and continental shelf rights, from 'rocks', which are only entitled to a 12-nautical-mile territorial sea.

The tribunal's criteria emphasised the ability of features in their natural state (before any reclamation work) to sustain 'human habitation' or 'economic life', creating a precedent that only islands with some history of permanent settlement (as opposed to periodic use by fishermen) generate EEZs and continental shelf rights.

According to these criteria, the tribunal found, none of the so-called Spratly Islands qualify as 'islands' in the legal sense. All are 'rocks'. Therefore, even if all the disputed Spratlys do belong to China, the areas beyond the 12-nautical-mile territorial seas around them are still part of the Philippines' EEZ.

This will probably be the case's most important impact globally. Under this definition, for example, Japan cannot continue to claim a 200-nautical-mile EEZ around Okinotorishima, which in its natural state was only a coral outcrop.

China's conduct

The third group of findings concern China's behaviour.

For example, China's operation to interfere with Philippine oil and gas surveys in the Reed/Recto Bank in 2011 was branded illegal, as were the economic activities of Chinese fishing fleets within 200 nautical miles of the Philippines coast (see SOUTH-EAST ASIA: Coastguard growth could see friction - February 25, 2016).

Further north, in the hotspot of Scarborough Shoal, China was chastised for its denial of Philippines fisherfolk's access to the shoal's lagoon, which the tribunal found to be traditional fishing grounds. The arbitrators also explicitly affirmed the traditional rights of fisherfolk of other countries, including China, to operate in the Shoal. It mandated, in other words, a shared fishing regime at Scarborough Shoal.

The tribunal also considered the effect of China's massive land reclamation and industrial fishing efforts on the marine environment. The island-building projects at seven features had caused "severe harm to the coral reef environment" in violation of UNCLOS articles requiring preservation of fragile marine ecosystems (see ASEAN/CHINA: New islands will harm maritime ecosystem - April 24, 2015).

Beijing was also held responsible for Chinese-flagged fishing vessels taking endangered sea turtles, coral and giant clams, inflicting more "severe damage" to the marine environment. The Chinese government was held to be aware of these activities and having failed to stop them.

Finally, the arbitrators designated several instances of Chinese law enforcement agencies acting in unsafe ways, especially during activities around Scarborough Shoal in 2012.

UNCLOS assertiveness

The five arbitrators were all eminent legal professionals who have played important roles in the development of the Law of the Sea throughout the 20th century, and their reasoning makes clear that they drew on this experience and background as they assessed the case.

Their decision was, above all, an assertion of the power of this international legal institution itself against misuse by governments in general, not just China. This was particularly so with the landmark interpretation that will constrain the claims of other states besides China.

One of the few results to go against the Philippines was the tribunal's ruling that it lacked jurisdiction on the question of China's naval conduct around Second Thomas Shoal. This clear rejection of jurisdiction over military behaviour may remove one of the obstacles to the United States ratifying the UNLCOS, since unwillingness to accept the possibility of restrictions on US military activity has contributed to Congressional intransigence on the issue.

What will China do?

China's response will not be clear before Beijing's experts have studied and analysed the finding in detail, which will require some weeks.

Besides pre-scheduled military exercises in non-sensitive parts of the South China Sea that coincided with the ruling, the only substantive reaction from Beijing has been the flight of a civilian aircraft from Subi Reef to Mischief Reef. The flight appears to indicate Beijing's intention to maintain its newly created outposts, while the choice of a civilian aircraft signals the intention not to escalate the situation in the short term.

Still, amid the blizzard of propaganda denouncing the arbitral award, there was some cause for optimism in Beijing's reaction. The authoritative statement of the Chinese government on the matter referred to the nine-dash line, but did not link it with China's maritime rights claims or historic rights.

This suggests an interpretation of the line as an indication of the area within which China claims sovereignty over islands and rocks, rather than the area within which it claims exclusive rights to fisheries and hydrocarbon resources. The latter interpretation has been a source of tensions between China and its South-east Asian neighbours.

This may be a sign that President Xi Jinping's administration may quietly move towards a reading of China's maritime rights that is more compatible with international law. Doing so would not require any public declarations of a change in position; China could simply desist from attempting to enforce its claims in areas where they are clearly unsupported by international law.

China's rhetoric is shrill and will probably remain so. However, this does not prevent China from acting more in accordance with what is legally permissible under UNCLOS. The tribunal identified numerous specific actions as illegal. China can refrain from such actions and others that imply expansionist readings of the nine-dash line that were struck down by the tribunal.

South China Sea ADIZ?

Chinese officials have reiterated China's 'right' to declare an air defence identification zone (ADIZ) over the South China Sea -- but not the intention. Practical considerations of limits to China's enforcement capabilities of an ADIZ will give Beijing pause, weighing against this move in the short term (see CHINA: China will hold back on ADIZ in South China Sea - July 7, 2015).

If an ADIZ is declared, it will force governments, their militaries and the many civilian airlines operating across South-east Asia to assess the implications. The announcement would quickly be challenged by US and other military flights.

The ADIZ that Beijing announced in the East China Sea in 2013 has had little practical impact to date. However, the 'rules' Beijing announced leave space for more aggressive enforcement, with a commensurate risk of accidental clashes if Beijing pursues this path. In an extreme case, airlines may feel they need to reroute flights, raising costs.

Duterte's dilemma

In principle, the Philippines should be the leading beneficiary of the ruling. In practice, the ruling will create further problems, which is partly why Manila has been muted in its response so far, unlike the rapturous approval by the Philippines public.

President Rodrigo Duterte's administration will need to issue a formal statement. If it accepts the tribunal's ruling, which is virtually guaranteed, this will limit its options vis-a-vis China.

The ruling comes soon after Duterte's June 30 inauguration, landing the untested administration with the most challenging array of foreign and strategic policy choices facing the Philippines in years.

During the election campaign and then the seven-week president-elect period, Duterte and his spokespersons struggled to devise a clear position on how to deal with the tribunal's ruling and its anticipated effects on China-Philippines relations.

Duterte's lack of foreign policy experience is not helped by the appointment of the similarly inexperienced Perfecto Yasay as foreign secretary. There is speculation that Yasay may have been appointed as an interim until the ban on Senator Alan Peter Cayetano, as an unsuccessful vice-presidential contender, entering the cabinet expires in 2017. If so, the foreign affairs brief could see dislocation next year at a critical time.

The need to analyse the 497-page judgment and its complexities will provide Duterte's team with a justifiable period of consideration and adjustment before they issue a statement, but politically they cannot afford to delay long.

Going back to go forward?

The previous administration under President Benigno 'Noynoy' Aquino decided to take China to court over the South China Sea in 2013, to reorient the Philippines military to be externally facing and to emphasise air force, navy and maritime security (see PHILIPPINES: Shooting hits maritime defence plan - March 3, 2015).

Duterte criticised both policies, favouring a return to the approach taken by former President Gloria Macapagal-Arroyo.

This meant publicly supporting bilateral talks with Beijing and not allowing any assertive Chinese actions in the disputed waters to hinder this. It included offering joint development of natural resources, and thus gaining more Chinese assistance for domestic infrastructure development and reducing the need to bolster the Philippines' maritime defence capacity.

The tribunal's ruling and Beijing's need to demonstrate its opposition hinder reviving this approach. Aspects of the UNCLOS ruling appear to preclude joint resource development in the Philippines' EEZ, an 'olive branch' that Duterte and Yasay have publicly contemplated offering China.

Duterte's team will have to forge a new way forward, but for the foreseeable future, maritime rights disputes with China will stay at the centre of Philippines foreign and security policy unless and until effective talks can be held.

The ruling also determined that present Chinese actions in the Philippines' EEZ that inhibit Philippines fishing, energy exploration and production are unlawful. If these actions continue, Duterte's administration will be under intense popular pressure to respond.

Talks?

China's public attacks on the tribunal's ruling make it unlikely in the near future that Beijing will back away publicly from its insistence that bilateral talks with Manila can only occur if the ruling is put aside, something now that will be hard for Manila even to consider. Reports today say Duterte may send former President Fidel Ramos to China to begin the talks.

If Beijing chooses to intensify unlawful actions in the Philippines' EEZ to reassert China's maritime claims, the tenuous basis for restarting bilateral talks will be weakened further -- one more reason that Beijing might avoid this course, even as its strident rhetoric continues.