In 2013, the Philippines instituted arbitration proceedings in the Hague against China over disputed South China Sea maritime claims – and in doing so it challenged legally of China’s nine-dash line claims over much of that area. Both states are parties to the UN Convention of the Law of the Sea (UNCLOS), which allows for binding dispute resolution through the Permanent Court of Arbitration. China has boycotted the proceedings, arguing that in ratifying UNCLOS it had opted out of mandatory dispute settlement of matters relating to sea boundaries.
Some expect the Permanent Court of Arbitration to reach a decision on jurisdiction – a preliminary ruling on whether it has authority to reach the ultimate merits – in 2015. More likely, though, it will schedule a hearing on the issue next year, which China will probably boycott, and even that preliminary decision on jurisdiction will not occur until 2016 because the jurisdictional arguments are so intertwined with complex issues that go to the ultimate merits. The legal maneuvering in 2015 will be intense, though, because the stakes are high.
For the parties themselves, even an ultimate decision on the merits of these issues may not settle the disputes, because China may ignore an arbitral ruling that it regards as illegitimate. But in the meantime, a decision on jurisdiction will shift diplomatic leverage one direction or the other.
For the United States, which is a treaty ally of the Philippines, a decision in the Hague that accepts jurisdiction could exacerbate tension between two policy tenets: that the United States does not take a position on competing sovereignty claims in the South China Sea and that it promotes settlement of disputes according to international law. Perhaps the United States can push harder for all parties, including China, to abide by arbitral decisions, but doing so is awkward because the United States has not itself ratified UNCLOS and thereby subjected itself to binding dispute resolution.
For the UNCLOS system – as a body of rules and binding dispute settlement mechanisms – prominence and credibility are at stake. A decision that the arbitral panel has jurisdiction would push UNCLOS and its international adjudicators further to the fore of disputes in this regional hotspot. In doing so, however, the arbitral panel would risk being ignored, derided and marginalized by the biggest player in the region.
