Narrow Court Ruling May Offer Room for Diplomacy on South China Sea Claims

SYDNEY: While tensions continue to rise in the South China Sea with steady military build-up by all sides, especially by China, a new pathway may be opening for peaceful resolution of the territorial disputes. The Arbitral Tribunal at the Permanent Court of Arbitration will soon announce whether it has jurisdiction to rule on the Philippines’ case against China’s expansive maritime claims in the South China Sea. China is expected to reject the court’s ruling, though it might eventually be compelled to soften its stance.

The decision, expected this month, marks the next stage in a bitter legal process that began in January 2013 when Manila resorted to international law to settle its maritime disputes with Beijing under the United Nations Convention on the Law of the Sea, or UNCLOS. Beijing immediately boycotted the proceedings, invoking its exemption to arbitration and refusing to submit formal documentation in defense of its claims. As positions hardened, China released a position paper on its objections while the United States, Japan, and Vietnam lent diplomatic support to the Philippines’ position.    

The crux of the Philippines’ case against China is a contention that Beijing’s “nine-dashed line” is not a legitimate basis for a maritime claim. In this way, the case has the potential to set a legal precedent for the entire region. Engulfing almost all of the South China Sea, the nine-dashed line has come to signify China’s maximalist claim to “indisputable sovereignty” – a major cause of regional maritime tensions. The broad claim tramples over the Exclusive Economic Zones, or EEZs, of Brunei, Malaysia, Vietnam and the Philippines. All have repeatedly asked China to clarify its nature. While Beijing argues its sovereignty is premised on “historical rights,” there is no legal precedent for this in international maritime law—which Manila hopes the tribunal will confirm.

Another key element of the Philippines’ case is an accusation that China has illegally occupied eight maritime features in the South China Sea based on its illegitimate claim to historical rights. More contentious is Manila’s related charge that at least four features—Subi, McKennan, Gaven and Mischief Reefs—are actually “low-tide elevations” rather than rocks or islands, which means that Beijing cannot use them as a basis to claim large-scale maritime jurisdictions. Under Article 121 of UNCLOS, only natural islands sustaining human or economic activity can generate a 12-mile territorial sea and a 200-mile EEZ. Rocks that are visible at high tide generate a territorial sea while low-tide elevations fully submerged in high water offer, at most, a 500-meter safety zone. Importantly, artificial expansion of any of these features does not alter their status in international law. A ruling in favor of Manila on any of these maritime features would undercut China’s claim to a nine-dashed line on the basis of EEZs extending from the eight features it occupies.

Most observers expect the tribunal to determine it has jurisdiction. The judges would then hear the merits of the case as early as November and announce their ruling by mid-2016. While full endorsement of Manila’s position is unlikely, a narrowruling against China is a strong possibility.

The tribunal will almost certainly rule that China’s nine-dashed line is an illegitimate basis upon which to claim maritime territory. This decision would likely be made on the grounds that historical claims have no recognized legal value. Although such a ruling would not discredit, per se, the claim put forward by Beijing, it would require China to provide an alternative legal justification for its nine-dashed line and represent a blow to Beijing’s rhetorical position.

Given that UNCLOS does not empower the tribunal to rule on sovereignty disputes, the court will probably avoid firm judgements about the particular features China occupies. As many fall within existing territorial seas or, as Beijing has argued, form part of larger archipelagos whose sovereign status is contested, determining their nature – island, rock or low-tide elevation – is a legal and political minefield. In addition, the poor quality of maritime surveys, particularly of the Spratly Islands, makes it hard to accurately appraise the original geographic nature of features that have since been artificially expanded. To be sure, the tribunal is likely to rebuke Beijing for its annexure of Scarborough Shoal in 2012 and rule that no country’s occupied features are permitted to have a “disturbing impact” on the baseline EEZ claims of a neighbouring state. But the judges will probably refrain from criticizing Beijing on the prickly issue of who owns what—focusing instead on the illegality of China’s nine-dashed line.

If handled properly, such a narrow ruling could offer an opportunity to defuse the longstanding tensions caused by China’s claim. For this to be possible, China and Southeast Asia’s littoral states must treat the verdict with restraint, recognize domestic political realities and adopt a collaborative approach in returning to negotiations.

Given Beijing’s rejection of the tribunal and vehement defense of its sovereignty, it will be politically impossible for China to wholeheartedly endorse criticism of its nine-dashed line by the Permanent Court of Arbitration. To avoid backing itself into this diplomatic corner, Beijing should use the months before the verdict to soften its opposition to international arbitration and embark on a negotiated settlement with Manila. This is unlikely. Instead, in the probable event of a narrow finding that does not explicitly challenge China’s claim to specific features, Beijing should publically recognize that the verdict was balanced. Beijing should also refrain from antagonistic statements against the tribunal’s findings, which would only make post-hoc efforts to moderate its position politically more difficult.

Crucially, Chinese officials should seize on the immediate post-arbitration period to specify the nature and extent of Beijing’s claims alongside their Southeast Asian counterparts—even if the official position is rejection of the tribunal’s authority and ruling. Given that many Chinese officials already privately recognize that Beijing needs to clarify its nine-dashed line, a narrow ruling could help allay misgivings about international law and galvanize Beijing into reducing the uncertainty surrounding its claim. To prevent further damage to its reputation by ignoring international law, in the wake of the verdict Beijing should fulfill its recent promise to speed up the China-ASEAN Code of Conduct and set a fixed timeline as a signal of its genuine intentions.

But moderation by Beijing will only be feasible if Southeast Asian nations also adopt a pragmatic response to the tribunal’s ruling. Above all, it’s imperative that Beijing is not made to feel that it is caught between international law and its domestic political interests. Manila should thus refrain from vitriolic public criticism of Beijing during and after the hearing to ensure that diplomacy remains a viable tool. As a sign of goodwill, the Philippines should accept China’s proposal to restart bilateral negotiations without preconditions, which would also inoculate Manila against Beijing’s critique that negotiations have not been exhaustively tried.

More generally, the Philippines, Vietnam, Brunei and Malaysia should not expect an immediate change to Beijing’s South China Sea claims in the verdict’s aftermath. Allowing China political leeway to begin clarifying, or compromising, its nine-dashed line would offer a face-saving way for a negotiated process to recommence. A useful starting point might be to leave issues of sovereignty temporarily aside while countries work towards jointly determining which features constitute rocks, reefs or islands as a confidence-building exercise. Ultimately, it is only by kick-starting more genuine negotiations that the Arbitral Tribunal’s verdict can bring meaningful stability to the South China Sea.