"The South China Sea Arbitral Award: Why China's Non-Participation Does Not Affect the

Binding Nature of the Award"

By: Mikhail Baula

Background of the Case

On 2015, the Republic of Philippines brought an arbitration case against China before
the Permanent Court of Arbitration (PCA) concerning certain issues in the South China Sea
including the legality of China’s nine dash line. 1It involves the interpretation or application
of pertinent UNCLOS provisions under its Annex VII. Philippines arguments are: (1)
whether China’s nine-dashed line claim, supposedly based on historic rights, can generate
maritime entitlements that can encroach on or overlap with the 200 NM Philippine EEZ, (2)
Whether certain geologic features, within Philippine EEZ, are (a) mere rocks above water at
high tide that generate no EEZ but only a territorial sea; or (b) LTEs that are not entitled to a
territorial sea and thus form part of the continental shelf of Philippine EEZ, (3)Whether
certain geologic features, outside Philippine EEZ, are (1) mere rocks above water at high tide
that generate no EEZ but only a territorial sea; or (2) LTEs that generate no territorial sea and
thus form part of the continental shelf and lastly. Whether China violated the sovereign rights
and jurisdiction of the Philippines within Philippine EEZ.
To sum it up Philippines raised five issues in the arbitration and these are: 1.) China’s
Historic Rights Claim — China’s claim to historic rights beyond its territorial sea is contrary
to UNCLOS. The nine-dashed line has no legal basis and cannot generate any maritime
entitlement (territorial sea, exclusive economic zone or extended continental shelf, 2.)
Geologic Features in the Spratlys — No geologic feature in the Spratlys is capable of human
habitation or economic life of its own so as to generate a 200 NM EEZ that can overlap with
Palawan’s EEZ, 3.) China-Occupied Geologic Features in the Spratlys — The Arbitral
Tribunal has jurisdiction to rule on the maritime entitlement and status (whether LTE or
High-Tide Elevation) of geologic features. These are not sovereignty disputes. A claim to an
EEZ is not a claim to sovereignty because a state cannot exercise sovereignty over its EEZ,
which is a maritime entitlement first created and governed by UNCLOS. The status of an
LTE beyond the territorial sea cannot involve any sovereignty dispute because such LTE is
incapable of sovereign ownership. Moreover, maritime entitlement is separate from sea
boundary delimitation because a geologic feature’s maritime entitlements do not always or
necessarily overlap with the maritime entitlements of another state, 4.) China-Occupied
Geologic Features in the Spratlys — The Arbitral Tribunal has jurisdiction to rule on the
maritime entitlement and status (whether LTE or High-Tide Elevation) of geologic features.
These are not sovereignty disputes. A claim to an EEZ is not a claim to sovereignty because a
state cannot exercise sovereignty over its EEZ, which is a maritime entitlement first created
and governed by UNCLOS. The status of an LTE beyond the territorial sea cannot involve
any sovereignty dispute because such LTE is incapable of sovereign ownership. Moreover,
maritime entitlement is separate from sea boundary delimitation because a geologic feature’s
maritime entitlements do not always or necessarily overlap with the maritime entitlements of
another state, 5.) Harm to the Marine Environment — China caused severe harm to the
marine environment. 2
1
A timeline of what happened in the South China Sea dispute, https://www.businessinsider.com/ap-timeline-
the-china-philippines-south-china-sea-dispute-2016-7
2
The South China Sea Dispute: Philippine Sovereign Rights and Jurisdiction in The West Philippine Sea, By
Antonio Carpio, https://archive.su.edu.ph/assets/media/2017New%20Folder/Philippine%20Sovereign
%20Rights%20and%20Jurisdiction%20in%20the%20West%20Philippine%20Sea%20The%20South%20China
 In sum, RP requested that the tribunal: rule on the compatibility with UNCLOS of
various aspects of Chinese and Filipino maritime entitlements or designations in the SCS,
such as ROC’s nine-dashed line (hereafter referred to as the 9DL); designate the geographic
characteristics of specific features in the SCS and their maritime entitlements as based upon
UNCLOS; and rule on whether ROC has committed several specific violations of UNCLOS
provisions regarding, for example, the management of marine resources, the activities of
Filipino fishermen, and the construction of artificial islands Philippines bolstered their claims
with these arguments leading to a violation of UNCLOS in which both of countries are
parties into. In no instance did RP explicitly ask for the tribunal to rule on whether China, the
Philippines, or some other state holds or should hold sovereignty over any of the geological
features or maritime zones of the South China Sea. Indeed, UNCLOS has no authority to
make such judgments. Its purpose is to provide a legal order identifying the characteristics of
the marine environment and the rights and responsibilities of nations regarding the use of that
environment.
On the other hand, China declared that it would not participate in the arbitration,
China has entirely refused to participate in the arbitration process and has completely rejected
the decisions of the PCA-administered tribunal, regarding that entity as illegitimate and
illegal and its judgments as null and void and inapplicable to China. In support of this
categorical stance, China has issued several authoritative documents and made several
authoritative statements explaining the legal, historical, procedural, and other aspects of its
position and the implications of the ruling.3
China based its claim on its historic rights. In essence, the Chinese position covers
four main points. First, by unilaterally initiating arbitration by a third party (the PCA-hosted
tribunal), Philippines clearly violated its presumably binding commitment, established
through several formal bilateral Sino Filipino agreements and originally affirmed by both
countries in the 2002 Declaration of Conduct regarding SCS disputes, to settle their relevant
disputes only through bilateral negotiation and to exclude any third-party procedure. Hence,
Philippines’ submission constitutes a “deliberate act of bad faith” and a violation of the
international legal norm pacta sunt servanda (“agreements must be kept”), and “the
compulsory third-party dispute settlement procedures under UNCLOS do not apply4.”
Because of this, Philippines had no right to seek third-party involvement, and that action
imposes no obligation on China.
China cites UNCLOS to support its assertion that when two states agree to settle
disputes relevant to UNCLOS via their own peaceful method (as Philippines and China
allegedly did), UNCLOS dispute-resolution procedures apply “only where no settlement has
been reached by recourse to such means and the agreement between the parties does not
exclude any further procedure.” Since, according to China, “the two states have never
engaged in any negotiation on [the subject matters of the arbitration]” and both states have
excluded third-party settlement procedures, Philippines’ unilateral submission has violated
UNCLOS and in particular “the right, as provided for in UNCLOS, of a State Party to
UNCLOS to choose the means of dispute settlement of its own will.”
Second, authoritative Chinese sources insist that Philippines “camouflaged its
submissions” to the tribunal by presenting them as isolated, non–sovereignty-related issues
%20Sea%20Dispute%20by%20Senior%20Associate%20Justice%20Antonio%20T.%20Carpio.pdf
3
Full Text: China Adheres to the Position of Settling Through Negotiation the Relevant
Disputes Between China and the Philippines in the South China Sea,
http://www.scio.gov.cn/zfbps/ndhf/34120/Document/1483617/1483617.htm
4
Understanding China’s Position on the South China Sea Disputes, https://isdp.eu/publication/understanding-
chinas-position-south-china-sea-disputes/
requiring narrow interpretation in relation to UNCLOS provisions, when in fact they all relate
to issues of territorial sovereignty and maritime delimitation between Philippines and China.
Moreover, in its Position Paper of December 7, 2014, Beijing stated: “China believes that the
nature and maritime entitlements of certain maritime features in the South China Sea cannot
be considered in isolation from the issue of sovereignty5.
Third, because of the preceding point, the sources argue that “the Arbitral Tribunal in
the South China Sea arbitration established at the Philippines’ unilateral request has, [from
the begi- nning], no jurisdiction, and awards rendered by it are null and void and have no
binding force.6
Fourth, in addressing both Philippines’ submission and the specific judgments of the
arbitral tribunal, authoritative sources assert that it is contrary to “widely recognized
international law” to treat the Nansha [Spratly] Islands separately in assessing their maritime
features, as both entities have done.7
The most significant aspects of the above Chinese viewpoints on the South China Sea
arbitration issue are as follows: First, the categorical and complete Chinese rejection of the
arbitration process and the tribunal’s ruling as illegal, illegitimate, a serious threat to vital
Chinese interests, and damaging to the international legal order and regional stability strongly
indicates that China is highly unlikely to accommodate to (much less accept) the ruling in any
foreseeable time frame. This is reinforced by China’s strong view that the entire process and
ruling were created and manipulated by the U.S. and other powers to weaken China and
foment disorder in the region, and that the U.S. is highly hypocritical in supporting the ruling.
Second, the above in turn strongly suggests not only that the arbitration process has
inadvertently deepened the strategic rivalry between the U.S. and China but also that overt
efforts by the U.S. and other powers to press Beijing to accept the ruling will almost certainly
prove to be extremely damaging to regional order and to Sino-U.S. relations. No external
entity exists to enforce the ruling, and while Beijing may eventually come to accept aspects
of it, this will most likely only occur over the long term, and as a result of growing awareness
in Beijing that its stance on the issue is having a serious negative impact on the PRC’s
prestige and influence in the global order, on important inter-state relationships, and on
China’s international image as a peace-oriented, law-abiding citizen of the global community.
Third, the apparent Chinese belief that no third-party entity, whether UNCLOS-based
or otherwise, can make any authoritative judgment about the specific geographical context
relating to territorial sovereignty disputes (e.g., concerning the nature of land features and
related maritime zones) largely makes such entities irrelevant to China in clarifying important
aspects of such disputes. For China, the only relevant means of doing this is via bilateral
diplomatic negotiations between the disputants.
Finally, most Chinese sources of whatever type seem to suggest that long-term
Chinese responses to the ruling will depend most importantly on what others do in the future.
5
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, https://www.fmprc.gov.cn/nanhai/eng/snhwtlcwj_1/t1368895.html
6
Full Text: China Adheres to the Position of Settling Through Negotiation the Relevant
Disputes Between China and the Philippines in the South China Sea,
https://www.chinadaily.com.cn/world/2016-07/13/content_26075050.htm
7
PRC Ministry of Foreign Affairs, “Foreign Ministry Spokesperson Hong Lei’s Regular
Press Conference,” July 8, 2016,
http://www.fmprc.gov.cn/mfa_eng/xwfw_665399/s2510_665401/2511_665403/t1378753
.shtml.
This might be of little consolation to many, but it at least suggests that other powers could
contribute to minimizing the damage generated by the arbitration issue and perhaps even turn
it into a genuinely renewed effort at confidence building, crisis avoidance, and the
establishment of a more stable modus vivendi in the South China Sea.

Tribunal’s Decision on Substantive Issues

The Tribunal held there is no legal basis for any Chinese historic rights, or other
sovereign rights and jurisdiction beyond those provided for in the Convention, in the waters
of the South China Sea encompassed by the ‘nine-dash line’ and that none of the high-tide
feature in the Spratly Islands is a fully entitled island for the purposes of Article 121 of the
Convention. There is thus no maritime feature in the Spratly Islands that is capable of
generating an entitlement to an exclusive economic zone or continental shelf in the areas of
Mischief Reef or Second Thomas Shoal, or in the areas of the GSEC101 block, Area 3, Area
4, or the SC58 block.
The Tribunal has also found (see paragraphs 374 to 381 above) that Mischief Reef
and Second Thomas Shoal are low-tide elevations and, as such, generate no entitlement to
maritime zones of their own. Additionally, Reed Bank (the area of the GSEC101 block) is an
entirely submerged reef formation that cannot give rise to maritime entitlements. From these
conclusions, it follows that there exists no legal basis for any entitlement by China to
maritime zones in the area of Mischief Reef, Second Thomas Shoal, the GSEC101 block,
Area 3, Area 4, or the SC58 block. There is thus no situation of overlapping entitlements that
would call for the application of Articles 15, 74, or 83 to delimit the overlap and no possible
basis for the application of the exception to jurisdiction in Article 298(1)(a)(i).
Also, the e Tribunal finds that China has, through the operation of its marine
surveillance vessels with respect to M/V Veritas Voyager on 1 to 2 March 2011 breached
Article 77 of the Convention with respect to the Philippines’ sovereign rights over the non-
living resources of its continental shelf in the area of Reed Bank. The Tribunal further finds
that China has, by promulgating its 2012 moratorium on fishing in the South China Sea,
without exception for areas of the South China Sea falling within the exclusive economic
zone of the Philippines and without limiting the moratorium to Chinese flagged vessels,
breached Article 56 of the Convention with respect to the Philippines’ sovereign rights over
the living resources of its exclusive economic zone.
On the next merit of the case, the Tribunal finds that China has, through the operation
of its marine surveillance vessels in tolerating and failing to exercise due diligence to prevent
fishing by Chinese flagged vessels at Mischief Reef and Second Thomas Shoal in May 2013,
failed to exhibit due regard for the Philippines’ sovereign rights with respect to fisheries in its
exclusive economic zone. Accordingly, China has breached its obligations under Article
58(3) of the Convention. the Tribunal also finds that China has, through the operation of its
official vessels at Scarborough Shoal from May 2012 onwards, unlawfully prevented Filipino
fishermen from engaging in traditional fishing at Scarborough Shoal. The Tribunal records
that this decision is entirely without prejudice to the question of sovereignty over
Scarborough Shoal.

The Tribunal finds that China has, through its toleration and protection of, and failure
to prevent Chinese fishing vessels engaging in harmful harvesting activities of endangered
species at Scarborough Shoal, Second Thomas Shoal and other features in the Spratly Islands,
breached Articles 192 and 194(5) of the Convention.. The Tribunal further finds that China
has, through its island-building activities at Cuarteron Reef, Fiery Cross Reef, Gaven Reef
(North), Johnson Reef, Hughes Reef, Subi Reef and Mischief Reef, breached Articles 192,
194(1), 194(5), 197, 123, and 206 of the Convention. The Tribunal finds that China has,
through its construction of installations and artificial islands at Mischief Reef without the
authorisation of the Philippines, breached Articles 60 and 80 of the Convention with respect
to the Philippines’ sovereign rights in its exclusive economic zone and continental shelf. The
Tribunal further finds that, as a low-tide elevation, Mischief Reef is not capable of
appropriation.

The Tribunal further finds that China has, by virtue of the conduct of Chinese law
enforcement vessels in the vicinity of Scarborough Shoal, created serious risk of collision and
danger to Philippine vessels and personnel. The Tribunal finds China to have violated Rules
2, 6, 7, 8, 15, and 16 of the COLREGS and, as a consequence, to be in breach of Article 94 of
the Convention.
Moreover, the Tribunal finds that China has in the course of these proceedings
aggravated and extended the disputes between the Parties through its dredging, artificial
island-building, and construction activities. In particular, while these proceedings were
ongoing:
(a) China has aggravated the Parties’ dispute concerning their respective rights and
entitlements in the area of Mischief Reef by building a large artificial island on a low-
tide elevation located in the exclusive economic zone of the Philippines.
(b) China has aggravated the Parties’ dispute concerning the protection and
preservation of the marine environment at Mischief Reef by inflicting permanent,
irreparable harm to the coral reef habitat of that feature.
(c) China has extended the Parties’ dispute concerning the protection and preservation
of the marine environment by commencing large-scale island-building and
construction works at Cuarteron Reef, Fiery Cross Reef, Gaven Reef (North), Johnson
Reef, Hughes Reef, and Subi Reef.
(d) China has aggravated the Parties’ dispute concerning the status of maritime
features in the Spratly Islands and their capacity to generate entitlements to maritime
zones by permanently destroying evidence of the natural condition of Mischief Reef,
Cuarteron Reef, Fiery Cross Reef, Gaven Reef (North), Johnson Reef, Hughes Reef,
and Subi Reef.

Next is that the Court ruled that past agreements between China and the Philippines
do not affect whether the PCA can adjudicate this dispute. The PCA focuses on three
agreements signed by both countries: (1) the 2002 Declaration on the Conduct of Parties in
the South China Sea (an agreement between all ASEAN countries and China to lessen
regional tensions by working towards a joint code of conduct), (2) Joint China/Philippines
statements to find a peaceable solution, and (3) the 1976 Treaty of Amity and Cooperation in
Southeast Asia (an agreement to settle differences by peaceful and cooperative means). China
argued that these documents precluded the Philippines from starting arbitration under Art.
281 and 282. The PCA, however, found that each of these documents (1) didn’t represent a
settlement between both parties, (2) didn’t exclude other dispute resolution mechanisms, and
(3) don’t require that the parties indefinitely pursue unsuccessful negotiations.8
8
PCA Case Nº 2013-19
IN THE MATTER OF THE SOUTH CHINA SEA ARBITRATION, https://pca-cpa.org/en/cases/7/
 In its most significant finding, the tribunal rejected China’s argument that it enjoys
historic rights over most of the South China Sea. The tribunal concluded that China doesn't
have the right to resources within its "nine-dash line," which extends hundreds of miles to the
south and east of its island province of Hainan and covers some 90% of the disputed waters.
That could give the governments of Brunei, Indonesia, Malaysia, Taiwan and
Vietnam more leverage in their own maritime disputes with Beijing. The tribunal also said
that China had violated international law by causing “irreparable harm” to the marine
environment, endangering Philippine ships and interfering with Philippine fishing and oil
exploration.

What is UNCLOS?
Over the years and centuries as technology developed and the needs of the people
across the world grew, there emerged a problem. Over-exploitation of the sea’s resources was
immensely felt towards the middle of the 20th century and many nations started feeling the
need to ensure protection of their marine resources. Starting with United States in the 1945,
many countries across the world brought under their jurisdiction, the natural resources found
in their oceans’ continental shelf. Some of the countries that exercised this power were
Argentina, Canada, Indonesia, Chile, Peru, Ecuador and even countries like Saudi Arabia,
Egypt, Ethiopia and Venezuela. Since the usage of the marine reserves rose even more in the
1960s and since missile launch pads also starting getting based in the oceanic bed, it became
imperative that a specific regulation be placed to ensure proper protection and jurisdiction of
the marine reserves9.
One of the important functions of UNCLOS is that it has mechanisms that govern sea
disputes between member nations10. The Tribunal has jurisdiction over all disputes
concerning the interpretation or application of the Convention, subject to the provisions of
article 297 and to the declarations made in accordance with article 298 of the Convention.
Article 297 and declarations made under article 298 of the Convention do not prevent parties
from agreeing to submit to the Tribunal a dispute otherwise excluded from the Tribunal's
jurisdiction under these provisions (Convention, article 299). The Tribunal also has
jurisdiction over all disputes and all applications submitted to it pursuant to the provisions of
any other agreement conferring jurisdiction on the Tribunal. A number of multilateral
agreements conferring jurisdiction on the Tribunal have been concluded to date.
The procedure in arbitration proceeding based on Annex VII of the UNCLOS are: 1.)
any party to a dispute may submit the dispute to the arbitral procedure provided for in this
Annex by written notification addressed to the other party or parties to the dispute. The
notification shall be accompanied by a statement of the claim and the grounds on which it is
based. 2.) There should be a list of arbitrators that should be drawn up and maintained by the
Secretary-General of the United Nations. Every State Party shall be entitled to nominate four
arbitrators, each of whom shall be a person experienced in maritime affairs and enjoying the
highest reputation for fairness, competence and integrity. The names of the persons so
nominated shall constitute the list. If at any time the arbitrators nominated by a State Party in
the list so constituted shall be fewer than four, that State Party shall be entitled to make
further nominations as necessary. The name of an arbitrator shall remain on the list until
withdrawn by the State Party which made the nomination, provided that such arbitrator shall
9
Nautical Law: What is UNCLOS?, https://www.marineinsight.com/maritime-law/nautical-law-what-is-unclos/
10
PART XV, UNCLOS, https://www.un.org/depts/los/convention_agreements/texts/unclos/unclos_e.pdf
continue to serve on any arbitral tribunal to which that arbitrator has been appointed until the
completion of the proceedings before that arbitral tribunal. 4.) The tribunal shall be
constituted as follows: a.) it shall consist of five members, b.) The party instituting the
proceedings shall appoint one member to be chosen preferably from the list who may be its
national, c.) the other party to the dispute shall, within 30 days of receipt of the notification
referred to in article l of this Annex, appoint one member to be chosen preferably from the
list, who may be its national. If the appointment is not made within that period, the party
instituting the proceedings may, within two weeks of the expiration of that period, request
that the appointment be made in accordance with subparagraph (e), d.) The other three
members shall be appointed by agreement between the parties. They shall be chosen
preferably from the list and shall be nationals of third States unless the parties otherwise
agree, e.) Unless the parties agree that any appointment under subparagraphs (c) and (d) be
made by a person or a third State chosen by the parties, the President of the International
Tribunal for the Law of the Sea shall make the necessary appointments. If the President is
unable to act under this subparagraph or is a national of one of the parties to the dispute, the
appointment shall be made by the next senior member of the International Tribunal for the
Law of the Sea who is available and is not a national of one of the parties, f.) Any vacancy
shall be filled in the manner prescribed for the initial appointment, (g) Parties in the same
interest shall appoint one member of the tribunal jointly by agreement. Where there are
several parties having separate interests or where there is disagreement as to whether they are
of the same interest, each of them shall appoint one member of the tribunal. The number of
members of the tribunal appointed separately by the parties shall always be smaller by one
than the number of members of the tribunal to be appointed jointly by the parties, (h) In
disputes involving more than two parties, the provisions of subparagraphs (a) to (f) shall
apply to the maximum extent possible.11

This is the procedure when a state decided to go to an arbitration proceeding. This

procedure ensures the independence and impartiality of tribunal. UNCLOS also states that it
is the duties of the parties to a dispute to: (a) provide it with all relevant documents, facilities
and information; and (b) enable it when necessary to call witnesses or experts and receive
their evidence and to visit the localities to which the case relates. With regards to expenses
the expenses of the tribunal, including the remuneration of its members, shall be borne by the
parties to the dispute in equal shares. The tribunal makes decisions by majority vote of its
members. The absence or abstention of less than half of the members shall not constitute a
bar to the tribunal reaching a decision. In the event of an equality of votes, the President shall
have a casting vote. Most importantly, Annex VII 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. The award
shall be final and without appeal, unless the parties to the dispute have agreed in advance to
an appellate procedure. It shall be complied with by the parties to the dispute. Hence, even
without China’s participation in the proceedings, it is clearly stated in the UNCLOS that this
non-participation does not in any way affect the proceeding.

11
Article 287, PART XV UNCLOS,
https://www.un.org/depts/los/convention_agreements/texts/unclos/unclos_e.pdf
China’s Position
China argues in its Position Paper that by signing the DOC, the Philippines and China
have undertaken a mutual obligation to settle their disputes in relation to the South China Sea
through “friendly consultations and negotiations” and thus “agreed to seek settlement of the
dispute by a peaceful means of their own choice. Consequently, if the Arbitral Tribunal does
not have jurisdiction, hence there is no such thing as the recognition or implementation of the
award.
China questioned the scope of jurisdiction of the Arbitral Tribunal raising four points:
First, compulsory arbitration can only be applied to settle disputes concerning the
interpretation and application of the UNCLOS. If the subject matters are beyond the scope of
the UNCLOS, the disputes shall not be settled by compulsory arbitration. The issue of
territorial sovereignty is one such case. Second, a State Party to the UNCLOS may declare in
writing that it does not accept compulsory arbitration with respect to disputes concerning
maritime delimitation, historic bays or titles, military and law enforcement activities, etc.
Such exclusions are effective to other States Parties. With respect to disputes excluded by one
party, other parties to the dispute shall not initiate compulsory arbitration; and even if it does,
the arbitral tribunal has no jurisdiction over them. Third, if parties to a dispute have agreed on
other means of settlement of their own choice, no party shall unilaterally initiate compulsory
arbitration; and even if it does, the arbitral tribunal has no jurisdiction over the dispute.
Fourth, at the procedural level, parties to a dispute are obliged to first exchange views on the
means of dispute settlement. Failing to fulfill this obligation, they shall not initiate
compulsory arbitration; and even if they do, the arbitral tribunal has no jurisdiction over the
dispute. 12
These are the “four bars” for state parties to initiate compulsory arbitration and
according to them, Philippines has violated international law in at least these four aspects.
China’s position is that Philippines should have undertaken “friendly consultations”
with them instead of bring an arbitration case. That according to DOC, China and Philippines
had an agreement to settle their territorial and jurisdictional dispute by peaceful means
through friendly consultations and negotiations between the member states. China claims that
DOC is validly binding among the parties and has a clear intention to establish rights and
obligations between the parties, irrespective of the form or designation of the instrument.
China argues that third-party settlement is “obviously” excluded by virtue of (a) the
emphasis in paragraph 4 of the DOC on negotiations being conducted “by the sovereign
States directly concerned” and (b) the Parties’ reaffirmation in the DOC and other
instruments of negotiations as the means for settling disputes.13
To sum it up, China’s argument is based on the DOC agreement which is a bilateral
agreement between the Philippines that states that territorial and jurisdictional dispute by
peaceful means through friendly consultations and negotiations between the member states

Philippines’ Position

12
PCA Case Nº 2013-19
IN THE MATTER OF THE SOUTH CHINA SEA ARBITRATION, https://pca-cpa.org/en/cases/7/
13
PCA Case Nº 2013-19
IN THE MATTER OF THE SOUTH CHINA SEA ARBITRATION, https://pca-cpa.org/en/cases/7/
 In response, Philippines argues that DOC poses no obstacle for the Tribunal’s
jurisdiction under Article 281 for four reasons: 1.) That DOC is not a legally binding
agreement within the meaning of Article 281. The document was only intended as a political
document, reflecting a compromise reached as a “stop-gap measure” to reduce tensions,
following years of trying for a legally binding code of conduct. 2.) That assuming arguendo
that DOC is a legally binding agreement, no settlement has been reached through the means
contemplated in it. According to the Philippines is a question of fact proven here by the
“numerous unsuccessful diplomatic exchanges, negotiations and consultations between the
Parties” and the exacerbation of the dispute in recent years. The Philippines claims it was
“entirely justified in concluding that continued negotiation would be futile. 3.) Moreover, the
agreement does not exclude recourse to dispute settlement procedures established in
UNCLOS. Philippines view is that DOC must expressly exclude recourse to dispute
settlement like arbitration or dispute settlement procedures under UNCLOS. China cannot
imply an exclusion when the DOC itself does not exclude such procedure. 4.) Even if
assuming that DOC has an exclusion of recourse to an arbitration, China still cannot rely on it
to avoid jurisdiction due to China’s own conduct in “flagrant disregard” of the DOC. 14The
Philippines invokes the general principle of law that “a party which . . . does not fulfil its own
obligations cannot be recognised as retaining the rights which it claims to derive from the
relationship.” In particular, the Philippines recalls paragraph 5 of the DOC, which the Parties
“undertake to exercise self-restraint in the conduct of activities that would complicate or
escalate disputes and affect peace and stability including, among others, refraining from
action of inhabiting on the presently uninhabited islands, reefs, shoals, cays, and other
features.” China’s disregard of paragraph 5 would, according to the Philippines, deprive it of
any entitlement to claim the benefit of its alleged rights under paragraph 4.
In conclusion, Philippines argued that the instituted proceedings is proper thus the
arbitration tribunal shall decide on the merits of the case. The Philippines argued that the
Tribunal had jurisdiction to determine whether certain insular features in the South China Sea
were either rocks (entitled to a 12 nm territorial sea), low-tide elevations no territorial sea), or
islands (entitled to a 200 nm zone), even though the features in question were subject to
territorial sovereignty disputes, as this involved interpretation of the relevant provisions of
UNCLOS.

Tribunal’s Decision on Jurisdiction

The Tribunal held that the arbitration was convened correctly. The Philippines was
justified in calling an ad-hoc tribunal since neither country opted for a specific type of dispute
resolution when they adopted UNCLOS. The Court also found that China’s non-participation
did not impact the Tribunal’s jurisdiction because Annex VII Art. 9 states that, “Absence of a
party or failure of a party to defend its case shall not constitute a bar to the proceedings.”
15
They also cited ways in which the PCA protected China’s rights, including repeated
invitations to comment on procedural steps, advance notice for hearings, transcripts, and an
invitation to join formally at any stage. The Court similarly argued that Vietnam’s non-
participation didn’t impact the PCA’s jurisdiction despite the fact that it has rival claims to
the same region.
The Court’s most stinging rebuke of China’s non-participation, however, was to adopt
a weaker standard for whether the Philippines abused process in requesting this arbitration.
14
Ibid.
15
Article 9, Annex VII UNCLOS,
https://www.un.org/depts/los/convention_agreements/texts/unclos/unclos_e.pdf
The PCA defined ‘abuse of process’ as “blatant cases of abuse or harassment” because China
did not request a more rigorous test under Article 294. By adopting such a weak standard it
was much more likely that the Philippines would win on this particular jurisdictional
argument. While we cannot be sure that a more stringent standard would have changed the
Court’s decision, China certainly lost an opportunity to more substantially protect its
interests.

The tribunal rejected China’s theory that: 1.) DOC excludes dispute resolute and thus
Philippines violated the agreement, 2.) that the Arbitral Tribunal award has no legal effect
and not binding. The Tribunal first decided on whether or not the DOC constitutes a binding
agreement. To constitute a binding agreement, an instrument must evince a clear intention to
establish rights and obligations between the parties. Such clear intention is determined by
reference to the instrument’s actual terms and the particular circumstances of its adoption.
The subsequent conduct of the parties to an instrument may also assist in determining its
nature. Although the DOC is entitled a “declaration” rather than a “treaty” or “agreement”, it
is well settled in international law that treaty can be designated in many names.16
The definition of a treaty based on Vienna Convention that provides: an international
agreement concluded between States in written form and governed by international law,
whether embodied in a single instrument or in two or more related instruments and whatever
its particular designation.”17 the Tribunal acknowledges that international agreements may
take a number of forms and be given a variety of names. The form or designation of an
instrument is thus not decisive of its status as an agreement establishing legal obligations
between the parties. DOC satisfies all the requirement of an international agreement. It is a
formal document with preamble, it is signed by both of the minister of China and ASEAN
states, and they are described as “parties” in DOC.
According to the tribunal, DOC contains many instances of the signatory States
simply “reaffirming” existing obligations. For example, in paragraph 1, they “reaffirm their
commitment” to the UN Charter, the Convention, and other “universally recognized
principles of international law.” In paragraph 3, they “reaffirm their respect and commitment
to the freedom of navigation and overflight” as provided in the Convention. In paragraph 10,
they reaffirm “the adoption of a code of conduct in the South China Sea would further
promote peace and stability in the region.” The only instance where the DOC uses the word
“agree” is in paragraph 10 where the signatory States “agree to work, on the basis of
consensus, towards the eventual attainment” of a Code of Conduct. This language is not
consistent with the creation of new obligations but rather restates existing obligations pending
agreement on a Code that eventually would set out new obligations. The DOC contains other
terms that are provisional or permissive, such as paragraph 6, outlining what the Parties “may
explore or undertake,” and paragraph 7, stating that the Parties “stand ready to continue their
consultations and dialogues.”18 Hence, DOC merely reiterate existing obligation and does not
create new obligations such aa the prohibition of filing arbitration proceedings.
16
PCA Case Nº 2013-19
IN THE MATTER OF THE SOUTH CHINA SEA ARBITRATION, https://pca-cpa.org/en/cases/7/

17
Article 2 Vienna Convention, https://treaties.un.org/doc/Publication/UNTS/Volume%201155/volume-1155-I-
18232-English.pdf
18
PCA Case Nº 2013-19
IN THE MATTER OF THE SOUTH CHINA SEA ARBITRATION, https://pca-cpa.org/en/cases/7/
 Next, the court answered the argument of China that DOC excludes dispute
resolution. It ruled in negative, in ruling that, it becomes apparent to this Tribunal that the
DOC was not intended to be a legally binding agreement with respect to dispute resolution.
The tribunal is convinced based on the purpose and circumstances surrounding the DOC’s
adoption reinforce that the DOC was not intended to create legal rights and obligations.
Hence it does not create an obligation to exercise only “peaceful consultations” between
states if the states have disputes and prohibits an arbitration proceeding.
Here are some descriptions from contemporaneous documents that amply demonstrate
that DOC was not intended by its drafters to be a legally binding document but rather an
aspirational political document:
a.) In December 1999, the Chinese drafters described their own October 1999 draft as
reflecting the “consensus that the Code should be a political document of principle.
(b) In August 2000, a spokesperson for the Chinese Foreign Ministry reporting on the
results the Second Meeting of the Working Group of the China–ASEAN Senior
Officials’ Consultation on the Code of Conduct stated that the “Code of Conduct will
be a political document to promote good neighbourliness and regional stability instead
of a legal document to solve specific disputes.”
(c) According to the official report of the Third Meeting of the same Working Group,
which took place on 11 October 2000, the participants “reaffirmed that the Code of
Conduct is a political and not legal document and is not aimed at resolving disputes in
the area.”
(d) Rodolfo C. Severino, who was the ASEAN Secretary-General at the time the DOC
was adopted and had been involved with negotiations over the South China Sea on
behalf of the Philippines since the 1990s, recalls that the final version of the DOC that
was signed in 2002 “was reduced to a political declaration from the originally
envisioned legally binding ‘code of conduct.
Therefore, it is apparent with these descriptions from contemporaneous documents
that DOC was not intended as a legally binding agreement because it does not create new
rights and obligations but only intends to be a political document that aims to promote good
neighbourliness and regional stability instead of a legal document to solve specific disputes.
Moreover, it can be seen in the subsequent conduct of the parties that the DOC is not
a binding agreement. In this respect, the Tribunal notes the Parties’ continuing efforts over a
decade after the DOC was signed to agree upon a Code of Conduct. The Tribunal also
observes that in recent years, at least before the arbitration commenced, several Chinese
officials described the DOC as “political” document. However, for completeness and in light
of their potential relevance for the other instruments, the Tribunal briefly addresses the
remaining elements of Article 281, namely whether a settlement has been reached by
recourse to the agreed means and whether the agreement excludes any further procedure.
The tribunal is now convinced that DOC is not a legally binding agreement but a mere
political document. The tribunal now ruled whether a a settlement has been reached by
recourse to the agreed means and whether the agreement excludes any further procedure. This
is an important question because even if it is only a mere political document, it could also be
a basis of an exclusion19.
19
PCA Case Nº 2013-19
IN THE MATTER OF THE SOUTH CHINA SEA ARBITRATION, https://pca-cpa.org/en/cases/7/
 The Tribunal now turns to the final element in Article 281 and finds that the DOC
“does not exclude any further procedure. It is a common ground that the DOC does not
expressly excludes recourse to dispute resolution procedures. While the DOC states that the
Parties undertake to resolve their disputes “without resorting to the threat or use of force,” it
does not say that the Parties undertake to resolve their disputes “without resorting to third-
party settlement.” The DOC does not say that the parties undertake to resolve their disputes
“only through friendly consultations and negotiations by sovereign states directly concerned.”
As the tribunal says, “It could have, but it does not”. Finally, The DOC does not specify that
the chosen means of negotiation “shall be an exclusive one and that no other procedures
(including those under Part XV of the Convention) may be resorted to even if negotiations do
not lead to a settlement.
However, China still argues that an express exclusion is not required. They cite the
case of Southern Bluefin Tuna 20wherein the tribunal applied the precautionary approach to
fisheries although the Law of the Sea did not expressly say so. The tribunal still applied the
said approach even it is not expressly provided by the Law of the Sea because it is a principle
which has found strong application in international law within the last decade. Even its status
as regards customary international law is still unresolved and disputed, the character of the
present case causes on to ask whether the tribunal’s order was the missing link to argue that
precautionary approach to fisheries has evolved into a norm of customary international law,
and if so, what implications the order may have for the determination of its content.
Moreover, it serves as a good example to illustrate the application of public international law
on a broader scale. On the side of the Philippines, it does not agree with China argues that the
intent to exclude further procedures under the Convention must be evident from the terms of
the agreement itself.
The tribunal considers the better view that Article 281 requires some clear statement
of exclusion of further procedures. This is supported by the text and context of Article 281
and by the structure and overall purpose of the Convention. It held that Southern Bluefin
Tuna’s majority opinion is not in line with the meaning of Article 281. . The text of Article
281 provides that when parties agree to resolve their dispute by other peaceful means, Part
XV dispute procedures “will apply” where the parties’ agreement “does not exclude any
further procedure.” This requires an “opting out” of Part XV procedures. It does not contain
an “opting in” requirement whereby the Parties must positively agree to Part XV procedures.
Such an “opting in” is only required where the parties have chosen an alternative compulsory
and binding procedure, as set out in Article 282. Pursuant to Article 282 the chosen binding
procedure will apply “in lieu of” the Part XV procedures “unless the parties to the dispute
otherwise agree. That distinction between Article 281 and 282 is consistent with the overall
design of the Convention as a system whereby compulsory dispute resolution is the default
rule and any limitations and exceptions are carefully and precisely defined in Section 3 of
Part XV.

Next, is whether the Tribunal award is binding to China even with the latter’s
objection and non- participation. China raised four points to argue that Arbitral award is null
and void. The court ruled on these points: First, the Tribunal noted that there is a dispute
between the Parties regarding sovereignty over islands, but held that the matters submitted to
arbitration by the Philippines do not concern sovereignty. The Tribunal also emphasised that
“the Philippines has not asked the Tribunal to rule on sovereignty and, indeed, has expressly
20
New Zealand v. Japan, https://www.informea.org/en/court-decision/southern-bluefin-tuna-cases-new-
zealand-v-japan-australia-v-japan
and repeatedly requested that the Tribunal refrain from so doing.” Second, the Tribunal noted
that a dispute concerning whether a State possesses 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 emphasised that:”A maritime boundary may be delimited only between States with
opposite or adjacent coasts and overlapping entitlements. In contrast, a dispute over claimed
entitlements may exist even without overlap, where—for instance—a State claims maritime
zones in an area understood by other States to form part of the high seas or the Area for the
purposes of the Convention. Accordingly, the Tribunal held that the claims presented by the
Philippines do not concern sea boundary delimitation and are not, therefore, subject to the
exception to the dispute settlement provisions of the Convention.
Therefore, with the forgoing facts and circumstances, the tribunal conclude that DOC
does not, by virtue of Article 281, bar the Tribunal’s jurisdiction. Hence, if the tribunal has
jurisdiction then the Award is binding to parties. It is clearly stated in Article 9 of Annex VII
of UNCLOS that the non-appearance of a party does not bar the proceedings and the other
party may request the tribunal to continue the proceedings and to make its award. The
Tribunal can now make award not only over its jurisdiction but also over the dispute that is
well founded in fact and law.

Final Note
Until today, China still do not honor the binding nature of the Tribunal award. China
still contends that the tribunal has no jurisdiction thus its award does not have binding effect
China has previously stated that it “will neither accept nor participate in the arbitration
unilaterally initiated by the Philippines”. The tribunal ruled, however, that China’s refusal to
participate did not deprive the court of jurisdiction. It remained exploiting the South China
Sea, even building machineries over it. The Chinese president, Xi Jinping, said China’s
“territorial sovereignty and marine rights” in the seas would not be affected by the 21ruling,
which declared large areas of the sea to be neutral international waters or the exclusive
economic zones of other countries. He insisted China was still “committed to resolving
disputes” with its neighbours. The acts of China have been increasing until today, it really
shows that they blatantly rejected the Tribunal’s ruling. The question now is, does China has
the right to defy the Tribunal’s award unilaterally? Does it not breached international law
relations?
Legally speaking, China has no right to defy the Tribunal’s award. Primarily, China
has expressly bind itself to UNCLOS by signing in this treaty as a member. It is well settled
in public international law that a country that has signed a treaty bounds itself to the
provisions of the treaty. A member country must expressly have reservations that means
defines reservations as “a unilateral statement, however phrased or named, made by a State,
when signing, ratifying, accepting, approving or acceding to a treaty, whereby it purports to
exclude or to modify the legal effect of certain provisions of the treaty in their application to
that State22, unless: the reservation is prohibited by the treaty; (b) the treaty provides that only
specified reservations, which do not include the reservation in question, may be made; or (c)
in cases not falling under sub-paragraphs (a) and (b), the reservation is incompatible with the

21
Beijing rejects tribunal's ruling in South China Sea case,
https://www.theguardian.com/world/2016/jul/12/philippines-wins-south-china-sea-case-against-china
22
Article 2(b) Vienna Convention, https://treaties.un.org/doc/Publication/UNTS/Volume%201155/volume-
1155-I-18232-English.pdf
object and purpose of the treaty. Hence China having no reservation with regards to Annex
VII of UNCLOS, the provisions are binding to them. 23

Therefore, they cannot put up a defense that the Tribunal does not have jurisdiction
over them. Following the principle pacta sunt servanda that is founded on the Vienna
Convention that governs the law on treaties. According to Article 26 of the Convention 24says
that “every treaty in force is binding upon the parties to it and must be performed by them in
good faith. A second fundamental rule, Article 46, is that a “party may not invoke the
provisions of its internal law as justification for its failure to perform a treaty.” 25As to the
territorial scope of its applicability, Article 29 says: “Unless a different intention appears
from the treaty or is otherwise established, a treaty is binding upon each party in respect of its
entire territory26. These principles of public international law bars the argument of China.
Therefore, China has an obligation to heed to UNCLOS provision because they are
party to that multilateral agreement. They cannot merely disobey the Tribunal that has vested
by UNCLOS jurisdiction to settle disagreements between Philippines. The Tribunal,
according to UNCLOS, has every right to decide on the controversy instituted by the latter.
According to Article 9 of Annex VII UNCLOS: “Absence of a party or failure of a party to
defend its case shall not constitute a bar to the proceedings”. The tribunal has the right to rule
based on facts and law presented by the appearing party. Based on the facts and law
presented by the Philippines, China violated several UNCLOS and international law
provisions.
However, many international law luminaries say that a ruling by the PCA, an
intergovernmental body with no enforcement capacity, itself will not stop China’s aggression
in the South China Sea. Moreover, as noted briefly before, Beijing is likely to take actions
that openly challenge the PCA’s ruling, particularly the findings that China’s historic claims
have no basis under international law and that certain Chinese-controlled features do not
generate extended maritime zones like EEZs. For instance, China could continue its land
reclamation and construction efforts in the Spratly Islands, which have added over 3,200
acres of land to the seven features Beijing occupies. China has begun transitioning to
infrastructure development, including developing at least three airfield – each with
approximately 9,800 foot-long runways – and constructing large maritime ports.27They
argued that the tribunal does not have enforcement laws or police that can enforce the award.
These are the weaknesses of international law, it lacks tooth.
Despite all of the weakness of PCA the Tribunal still believes that this decision should
be obeyed by both parties to maintain the global peace and governance. Declarations publicly
made and manifesting the will to be bound may have the effect of creating legal obligations.
When the conditions for this are met, the binding character of such declarations is based on
good faith; States concerned may then take them into consideration and rely on them; such
States are entitled to require that such obligations be respected. The inaction of a State which
is faced with a situation constituting threat or infringement of its rights. Acquiescence thus

23
Article 16 Vienna Convention, https://treaties.un.org/doc/Publication/UNTS/Volume%201155/volume-1155-
I-18232-English.pdf
24
Vienna Convention, https://treaties.un.org/doc/Publication/UNTS/Volume%201155/volume-1155-I-18232-
English.pdf
25
Ibid.
26
Ibid.
27
Interview: The South China Sea Ruling, by Roncevert Ganan Almond,
https://thediplomat.com/2016/07/interview-the-south-china-sea-ruling/
takes the form of silence or absence of protest in circumstances which generally call for a
particular reaction signifying an objection This ruling is a diplomatic way in resolving a
dispute that members of international community should respect to maintain not relationships
among states but also peace and order in the community. China should heed to the ruling of
the tribunal.
Thus, any violation or infringement of the Award or of Philippine territory by other
states, such as exploration activities by other states within Philippine EEZ or the installation
of facilities on LTEs within Philippine EEZ, or on high-tide elevations forming part of
Philippine territory, must be promptly protested formally to prevent any opposing state from
claiming acquiescence by the Philippines.28

28
The South China Sea Dispute: Philippine Sovereign Rights and Jurisdiction in The West Philippine Sea, By
Antonio Carpio,