ASIA/CHINA: Law could defuse Spratly

rivalries
Tuesday, September 15 2009

Relevant Country Data: China | Indonesia | Malaysia | Philippines | Taiwan

An Oxford Analytica In-depth Analysis

SUBJECT: Disputed maritime claims in East and South-east Asia.

SIGNIFICANCE: Unresolved sovereignty and jurisdictional disputes represent

serious potential threats to security in the region. However, risks here would be
minimised by agreement, even on a provisional basis. Go to conclusion

ANALYSIS: Maritime jurisdictional claims in East and South-east Asia are informed by
nationalism but also the promise of natural resources:

Key insights

 Maritime claims in the South China Sea are not entirely clear, and agreement between
the parties, even if only temporary, would help defuse tensions.
 The Spratly Islands, considered important flashpoints, are of exaggerated importance
in deciding jurisdictions in law.
 Longer-term resolution of differences should be possible by applying international
law, but this requires the parties be willing to have recourse to it and/or to courts or
arbitration bodies.

 these include hydrocarbons (see INTERNATIONAL: Saudi increase will have limited
effect - June 23, 2008); but also
 living resources, which play a crucial role in meeting the greater part of the nutritional
needs of substantial populations along coastal zones of the region; and
 marine biomass, such as for pharmaceuticals, whose economic potential through
exploitation remains largely untapped, but could be of enormous significance (see
INTERNATIONAL: Pharma shifts focus to emerging markets - September 4, 2009).

Maritime jurisdiction. China, a major claimant, has maritime boundaries with North Korea,
South Korea, Japan, Vietnam and the Philippines. There may be one or more boundaries with
Malaysia, and possibly Brunei, if Chinese sovereignty claims over certain islands are upheld.
The littoral states of the South China Sea have said they want to resolve their differences
peacefully, in accordance with international law. However, their public stance on sovereignty
over islands and ocean resource rights is, like China's, uncompromising.
The United Nations Convention on the
Law of the Sea, 1982, sets out the rules on
maritime jurisdiction:

 All South China Sea states are

parties to this agreement, in force
since 1994. It provides first for
coastal state sovereignty over a
territorial sea (including sea-bed,
sub-soil, and superjacent airspace)
of twelve nautical miles in breadth
(less if the coast of an opposite
state is less than 24 nautical miles
distant). This is subject to the right
of innocent passage for foreign
vessels.
 All zones of maritime jurisdiction
are measured from a baseline,
normally the low-water mark.
Where the coast is deeply indented
or fringed with islands, a system of
straight baselines may be drawn,
but conservatively, to facilitate
fixing outer limits. Many East and
South-east Asian countries have
implemented straight baselines systems either where they are not required or in a way
that boosts their claims, running up against the spirit and letter of the Convention.

The major zones of jurisdiction in the oceans are the exclusive economic zone (EEZ) and the
continental shelf. There is a measure of overlap between the two regimes, but in combination,
they give coastal states sovereignty rights for the purposes of the exploration for and
exploitation of natural resources of the sea, sea-bed, and sub-soil, to 200 nautical miles from
the baselines (except where states are less than 200 nautical miles distant).

The baseline is therefore important:

 The continental shelf regime allows states to claim rights beyond 200 nautical miles
provided that the "continental margin" so extends.
 The edge of the margin is the point where the natural prolongation of the landmass
meets the deep ocean floor, usually at depths of 2,000 to 4,000 metres.
 The Convention contains rules for fixing this point. States are required to submit
claims beyond 200 nautical miles to the Commission on the Limits of the Continental
Shelf, a UN body.

As of August, some 60 claims to extended jurisdiction worldwide are pending, including a

joint South China Sea submission by Malaysia and Vietnam, to which China has objected.

Complications. None of the basic jurisdictional scheme is controversial, except perhaps

perceived misuse of straight baselines. However, problems arise determining maritime
boundaries between opposite and adjacent neighbouring states:
 1. Median/equidistance. Rules, supported by state practice, suggested that the
appropriate boundary was a median or equidistant line drawn using agreed points on
the coastlines of the states concerned, but adjustable to take account of 'special
circumstances', such as the shape of the coastline or the presence of (often quite
small) offshore islands. Disputes as to what did or did not constitute circumstances
requiring a departure from median/equidistance could stand in the way of agreement.
2. Court contribution. The International Court of Justice (ICJ) introduced factors such as
the "natural prolongation of the seabed" -- that is, attaching significance to the extent
of the physical continental shelf, as opposed to drawing lines from coasts -- which
might be taken into account in determining a boundary. States with an extensive
natural shelf have seized on this, their other party preferring median/equidistance. In
the East China Sea, China's position is based on natural prolongation; Japan prefers a
median (equal shares) line. China's claim extends beyond the median. Natural
prolongation is broadly falling out of favour.

Firm principles or rules on delimitation are absent from the Convention. States are
free to agree on anything (not trenching on the rights of other countries), but
otherwise, should apply the rules of international law to achieve an equitable result.
This introduces considerable subjectivity. State practice appears firm on the use of the
median line for opposite states, but discerning a firm principle from adjacent
boundaries presents more challenges. The ICJ seems to start from a median or
equidistance line, then modify it as necessary to achieve the equitable result.

One reason for modification is a marked disparity in the length of coastlines between
the states concerned. For example, if the respective coastlines are in a proportion of
3:1 fronting the marine area in question, then the boundary should allocate waters and
seabed in that ratio, a test known as "proportionality". In short, not all land is of equal
weight when it comes to maritime boundary-making.

South China Sea. These rules and principles mean that the impact of the Spratly or other
islands on regional maritime boundaries should be small:

 Even the largest features are virtually insignificant in any scale of measurement.
 The smallest are mere rocks above water at high tide by little.

They qualify as islands in international law, but their significance measured against zones
generated by the landmass of any littoral will be minimal. Illustrative cases such as the
Channel Islands (France/United Kingdom) and St Pierre et Miquelon (Canada/France)
represent island chains with permanent, viable populations and economies. None of the South
China Sea islands can sustain populations in this way.

China's pre-1949 government map showed eleven dashes off the coasts of the Philippines,
Malaysia, Brunei, Indonesia, and Vietnam, the precise nature of what was being claimed
being and remaining somewhat uncertain. (The best view is that China claims all islands
bounded by these crude indicators.) Chinese vessels have plied these waters since time
immemorial, giving rise to a claim to 'historic waters'. Vietnam makes more or less the same
claim for the same reasons. The Philippines relies on colonial history and a convoluted series
of domestic moves suggesting that the Spratly group is subject to its sovereignty. These
jurisdictions claim all of the Spratly Islands, as does Taiwan.
Malaysia's maritime claim is based on the Convention, and its occupation of a handful of
southern features. Brunei does not claim any islands, but some reefs are within its claim area.
(Some label it a 'Spratly claimant', which it is not.) Indonesia's claims are limited to the
Natuna Group, not part of the Spratlys, though 'within' the Chinese/Taiwanese dashed line
map.

It is hard to see how the South China Sea can be regarded as historic waters:

 That concept is employed for relatively small sea areas -- eg a bay or Gulf.
 Mariners and fishers from what is now China have roamed the South China Sea for
centuries, but so have those from coasts now part of Malaysia, the Philippines,
Vietnam, Indonesia and elsewhere.

No South China Sea island has a population; each littoral can adduce evidence of use.

Extreme rhetoric deployed by claimants suggests no room for compromise or manoeuvre, and
determining sovereignty may well be beyond the reach of international law. Maritime
jurisdictional questions may likewise languish in legal limbo, as will other matters, such as
controlling illegal and unsustainable fishing, environmental protection or disaster response.

The importance of the Spratly Islands in South China Sea jurisdiction has been grossly
exaggerated:

1. Islands. The Convention defines an island as a naturally formed area of land,

surrounded by sea, and above water at high tide. This disposes of most of the features
in the Spratly group. Zones of maritime jurisdiction are generated solely by land
(mainland or islands). The remaining features that qualify as islands generate a twelve
nautical mile territorial sea, but possibly nothing else.
2. Fortification. A number of features not qualifying as islands have been built on (eg
Mischief Reef). This does not change their juridical status:
o They are not artificial islands, do not generate zones of maritime jurisdiction
beyond a safety zone of 500 meters radius, and have no impact on
delimitation.
o Fortification does not alter the essential position as regards rights to resources.
o Accepting a process of transforming a reef or low-tide elevation into an island
would have internationally unacceptable consequences worldwide.
3. Rocks. The Convention denies EEZ/shelf generating status to rocks that cannot
sustain human life or support an independent economic existence. A significant
number of Spratly features, while islands, are also rocks for this purpose. The
jurisdictional significance of these features, while not exactly negligible in that they
will generate a territorial sea, is nonetheless the subject of exaggeration. The United
Kingdom modified its claims from distant Rockall after ratifying the Convention,
accepting it as a rock.

Institutional limitations. Most international disputes are left unresolved or are settled by
negotiation. International law presupposes states will enter into talks to resolve differences.
Failing this, they have recourse to other means of peaceful settlement, including the good
offices of a third party, conciliation, arbitration and judicial settlement.
In the South China Sea region, only Indonesia, Malaysia and Singapore have been parties to
international judicial proceedings, before the ICJ. The establishment of both the World Court
and the Permanent Court of International Arbitration predate the establishment of the
People's Republic of China, and the independence of many of China's maritime neighbours.
Recourse to these bodies, ad hoc tribunals or arbitrations has been limited, and is unlikely.

States are encouraged to seek judicial settlement of disputes if all else fails, but only those
that have accepted the compulsory jurisdiction of the ICJ can be compelled to appear before
it. Neither China nor any of its maritime neighbours have done so. Their express agreement
would be required for the commencement of a formal process of any kind, through an
established body or one created ad hoc.

Difficulties lie in determining what precisely is in dispute. In maritime boundary cases, the
issues are typically restricted to a relatively small number of factors, such as the significance
of an island belonging to one state inconveniently located close to the coastal zone of the
other. Here the court must decide on the weight to be given to a particular feature. For China,
there is the complication of determining sovereignty over disputed islands, and this where the
applicable historical record may be of little or no help in furthering the case of one state over
another.

Countries are notoriously reluctant to submit such disputes to courts and tribunals:

 Where a maritime boundary alone is at stake, there is always the temptation -- seldom
resisted -- to 'split the difference'.
 With sovereignty, this option is not available. A state must consider the possibility
that a decision will go against it.

Bilateral island disputes are complex enough, but the situation with the Spratlys is impossibly
entangled. It is difficult to contemplate the court agreeing to hear a bilateral application as
other interested parties would inevitably indicate that they also had a claim to the territory in
question, and might well refuse to participate in proceedings.

Collaboration route. Natural resources can be exploited without any need to establish a
maritime boundary in a disputed area. Regional examples of offshore petroleum joint
development include:

 in the Timor Sea (Australia/Indonesia, then Australia/East Timor) (see EAST

TIMOR: Treaty underpins the country's future - March 13, 2006); and
 successful joint development established by Malaysia and Thailand, with some
Vietnamese participation, and between Malaysia and Vietnam, in the Gulf of
Thailand.

There is no legal obligation to enter into such arrangements, but where a maritime boundary
has yet to be resolved, the Convention encourages states to enter into "provisional measures
of a practical nature" for the time being.

In respect of China, the treaty establishing the maritime boundary with Vietnam establishes a
joint fishing zone in the Gulf of Tonkin, and a 2002 treaty with Japan provides for what
appears to be a workable solution to an otherwise intractable jurisdictional dispute in the East
China Sea. However, offshore petroleum joint development is different from fishing:
  Offshore hydrocarbons are politically sensitive, which inhibits the jurisdictional
creativity lawyers can bring to bear. The cooperative arrangements in the Timor Sea
and Gulf of Thailand were entered into for very specific reasons, and in response to
unique sets of circumstances, which may not apply to China and its maritime
neighbours.
 The parties to the existing offshore petroleum joint development arrangements did not
apparently consider that they were legally obliged to enter into them. This lack of
legal obligation suggests that international law has not developed to the point where a
party to a dispute can use the language of obligation when urging a cooperative
arrangement on a neighbour. The peaceful settlement of a dispute is an obligation: the
conclusion of a joint development zone is not.

Solutions. The conventional means of establishing sovereignty and jurisdiction may not be
available here, but international law can supply the means for bringing about the exploration
and exploitation of resources. Governments can be put on the spot as to whether they want to
use international law, and the Convention, as they say they do. A roadmap for resolution
might be:

 setting opposite and adjacent boundaries drawn from coastlines using established
practices;
 identifying features meeting the definition of an 'island' in the Convention;
 examining each island to determine whether it can support life or an independent
economic existence, enclaving features that fail this test in a twelve nautical mile
territorial sea;
 evaluating those (few) that pass the test to consider their potential impact on
boundaries drawn from coastlines of littorals using established rules and practices;
and
 adjusting all lines to ensure proportionality.

CONCLUSION: The stakes in respect of rival sovereignty claims are high. All in all, whether
one relies on the Convention or the pronouncements of the ICJ on proportionality, it appears
likely that the islands in the South China Sea, far from holding the key to maritime
jurisdiction, are of much less significance than some imagine. Building on reefs has no
impact on the juridical situation.

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Primary Keywords: AP, Asia, Brunei, China, Indonesia, Malaysia, Philippines, Taiwan,
Vietnam, economy, industry, international relations, politics, border conflict, fishing,
international law, judicial, natural resources, regional

Secondary Keywords: Australia, Canada, East Timor, France, Japan, North Korea, South
Korea, Thailand, United Kingdom, United Nations, food, pharmaceutical, security

Word Count (approx): 2471