On 29 October the Permanent Court of Arbitration in the Hague announced that it does indeed have jurisdiction to hear seven of the Philippines’ fifteen complaints against China. Thus the Philippines ‘won’ the first round of its case. There is little dispute about this and globally Filipinos and supporters of its case against China celebrated. But this may well turn out to be a Pyrrhic victory both for the Philippines and for stability and peace in the South China Sea and much of Southeast Asia. Political ripples are emanating from the initial decision and they are likely to become waves as the process unfolds.

 

Indeed, Indonesia has indicated it may file a similar complaint. Other claimants may follow suit. As the case progresses it will become ever more difficult for Southeast Asian countries and interested outside parties like Australia to remain neutral.

 

Australia, Indonesia, Japan, Malaysia, Singapore, Thailand and Vietnam sent observers to the hearing indicating their strong interest in its outcome. A U.S. request to attend was rejected because it has never ratified the UN Convention on the Law of the Sea, the legal basis of the Philippines' submission.

 

A second round of pleadings was held 24-30 November regarding the merits of the seven ‘submissions’, and on the question of jurisdiction and the merits of seven of the remaining complaints.  A decision on these issues is expected in mid-2016. The Philippines has until December 18 to submit further written responses to the PCA’s questions and China has until 1 January to comment. It is very unlikely that China will do so officially. China refused to appear before the Court arguing that it had no jurisdiction. Regarding the Court’s decision that it did have jurisdiction over some of the complaints, it stated that as far as it was concerned the initial ‘award’ was “null and void “.

 

China’s supporters contended that the Philippines had not exhausted its obligation to negotiate the issues bilaterally as stipulated in the mutually agreed Declaration on Conduct of the Parties in the South China Sea (DOC). This political document states that the “parties concerned undertake to resolve their territorial and jurisdictional disputes through negotiations by sovereign states directly concerned.”  But the PCA found that the DOC does not preclude its jurisdiction. This means that the DOC -- including its ‘self restraint’ provision-- is essentially impotent. This finding is likely to further hinder efforts to reach agreement on a Code of Conduct since the DOC was supposed to be a precursor to a COC.

 

 

 If the PCA finds that China’s nine-dash line --which is at the core of the complaints--doesn’t have any basis in international law, it could still rule that China has a potential legitimate claim to continental shelves and EEZs for legal islands in the area. Even if the PCA does not address this issue directly for all the features that are claimed by China, it can still make and pursue these claims.

 

If the PCA goes on to rule against China’s 9-dashed line claim does not have any basis in international law, it could be committing institutional suicide. China will likely not abide by the ruling, legal and political uncertainty will reign in the South China Sea, and violent incidents there are likely to proliferate. The authority and legitimacy of the UNCLOS dispute settlement mechanism and even the Law of the Sea itself may be undermined.

 

In any case, China is likely to simply carry on with its construction on the features it occupies and it may well ‘militarize’ them despite repeated US warnings not to do so. China’s defiance of the international system and the U.S. and its military presence in the heart of the South China Sea may intimidate the smaller littoral countries. This will then draw more physical US challenges in the form of so-called Freedom of Navigation operations like the recent muddled USS Lassen probe. And that in turn will sharpen the divide within ASEAN between supporters of the two powers and in a worst scenario lead to conflict between the two--or even proxy wars or internal conflicts in the region. This has happened before-- throughout history. Some are clearly hoping that the U.S. will ride in at the last minute like the Lone Ranger on its white horse and save the day. Perhaps it will--but don’t bet on it. And even if it does, the South East Asian countries should ‘be careful what they wish for’. They may be caught ‘betwixt the devil and the deep blue sea.’

 

The Philippines’ lead counsel Paul Reichler believes that if China defies the PCA’s judgment it will ‘lose prestige and influence’.  Indeed, in his--and many international lawyers’ preferred ideal world-- there would be serious consequences for violating formal agreements like UNCLOS --particularly if a court finds that is indeed what has occurred.  Perhaps the world should be this way. But it is not. This is not realistic because it does not take ‘power’-- both hard and soft-- into account. China may lose ‘prestige’ among idealists and international lawyers but among realists it will not lose influence in the region.  In fact its enhanced assertiveness and ever growing economic and military power is likely to continue to “influence” its neighbors and other claimants. Did Russia lose “influence” when it did not participate in the pleadings and refused to comply with the ITLOS judgement against it in the Arctic Sunrise case? When the U.S. withdrew from the case brought against it to the World Court by Nicaragua, did it lose ‘influence’? Mr. Reichler should know --he was a counsel for Nicaragua at the time. Perhaps he is engaging in the same wishful thinking --at the literal expense of the Philippines this time around.

 

The whole dispute is likely to eventually move back to bilateral negotiations between China and the other claimants. Nothing will have been really ‘won’. Indeed, all the case is likely to do is to further aggravate China and bolster Beijing’s hardliners who view the international system as being used to constrain and contain China. And as China becomes bigger and bolder in every way the claimants and other ASEAN members may suffer consequences especially those who showed their pro-US hand early on. The only real ‘winners’ in this affair may well be the U.S. law firm that the Philippines hired to represent it in this case.

Mark J. Valencia

Adjunct Senior Scholar

National Institute for South China Sea Studies