One privilege of being retired that one can watch ABC News24 daytime television while others are hard at work. On Wednesday 13 July around midday, I was treated to a dramatic spectacle: a Chinese Deputy Foreign Minister in an hour-long international media conference in Beijing fiercely denouncing, as a ‘scrap of waste-paper fit only for the rubbish bin’, a Permanent Court of Arbitration (PCA) Award (ruling) made by the South China Sea Arbitration Tribunal the day before, 12 July. I watched fascinated as the Minister criticised the ruling with great force, even challenging the legitimacy of the Tribunal’s selection and membership. A Chinese White Paper was issued on the same day detailing why China rejected the ruling.
Since then I have been communicating with two of Australia’s leading international lawyers trying to get my non-legal layman’s head around the main issues. I take full responsibility for my comments here, as a former diplomat concerned for the smooth and mutually respectful conduct of great power relations, and the profound consequences it can have for international peace and security when this goes wrong.
I am concerned that a very angry China, a nuclear-armed great power and permanent member of the UN Security Council, sees itself as publicly humiliated by a prestigious international arbitral tribunal. This is not a victory: it hurts all of us.
At the time China ratified UNCLOS in 1996, it made a Declaration that, in accordance with UNCLOS, China shall enjoy sovereign rights and jurisdiction over an exclusive economic zone of 200 nautical miles and the continental shelf; that China will effect through consultations the delimitation of the boundary of the maritime jurisdiction with the States with coasts opposite or adjacent to China respectively, on the basis of international law and in accordance with the principle of equitability; that China reaffirms its sovereignty over all its archipelagos and islands as listed in article 2 of the Law of the People’s Republic of China on the territorial sea and the contiguous zone, promulgated on 25 February 1992; and that China reaffirms that UNCLOS provisions concerning innocent passage through the territorial sea shall not prejudice its right as a coastal State to request foreign states to obtain its advance approval or give prior notification for the passage of warships through its territorial sea.
China made a further important Declaration in 2006 under article 298 in Section 3 of UNCLOS Part XV, dealing with ‘Settlement of Disputes’. Article 298, ‘Optional Exceptions to Applicability of Section 2’, allows countries to declare that they do not accept ‘Compulsory Procedures Entailing Binding Decisions’ as set out in Section 2 of Part XV. This 2006 Chinese Declaration said that China ‘does not accept any of the procedures provided for in Section 2 of Part XV of the Convention with respect to all the categories of disputes referred to in paragraph 1 (a) (b) and (c) of Article 298 of the Convention’.
By this means, China thought it had, within the terms of UNCLOS, correctly safeguarded its extensive maritime sovereignty claims in the South China Sea from any risk of resort to compulsory and binding arbitration of disputes by maritime neighbours who were contesting China’s claims.
China’s claims to almost all of the South China Sea go back up to 2000 years. At various times, China was a major maritime trading nation with powerful fleets plying the seas as far as India and Indonesia. The Chinese regarded the semi-enclosed South China Sea as their own sea, in a similar way that the Roman Empire regarded the Mediterranean as ‘Mare Nostrum’ – our sea. The various atolls, reefs and rock outcrops exposed at low tide were known to Chinese navigators and mapped as hazards to shipping. Many of these were uninhabited and unexploited except for occasional fishing and shell collection visits; but these geographical features in the South China Sea were seen by China under successive dynasties as traditionally theirs. The Chinese White Paper explores this history in detail.
A vague line on maps, the ‘Nine-Dash Line’, circumscribed this large area of sea, which was first publicly claimed in modern times by the Republic of China in 1947. The PRC maintained those claims, with some minor alterations, but never accurately defining them beyond vague dash lines. In 2009 China submitted a map to the UN showing the nine-dash line, asserting its claim but still not exactly defining its coordinates.
Neighbours protested. There were bilateral negotiations with them, in which China conceded little if anything. There were some incidents of armed conflict at sea around the features. The US and its Western partners protested at Chinese claims over what they see as high seas.
Meanwhile China began literally creating facts on the ground with large-scale civil engineering works, importing sand and concrete to create permanent habitable islands out of semi-submerged rocks and reefs. There was resulting damage to the natural environment. Lighthouses, harbours and airstrips were built. Naval visits became regular and prolonged. China spoke of plans for eventual civilian habitation, with nuclear-powered desalination plants to provide ample fresh water to support agriculture and sustainable civilian populations.
All this activity ran counter to the culture of UNCLOS which does not recognise historically or culturally based maritime claims, and defines territorial rights and claims as solely generated under UNCLOS rules by natural maritime features in their original, unimproved state. Under UNCLOS, natural islands generate valuable maritime exclusive economic zones; semi-submerged rocks and reefs only generate 12-mile territorial seas. Yet China believed that its 1996 and 2006 Declarations had protected its legal position as a claimant state under UNCLOS.
In 2013 the Philippines, losing patience with the snail’s pace of its bilateral negotiations with China, withdrew from them and began an ingenious recourse to compulsory arbitration under Section 2 of Article XV of UNCLOS. It did not contest the Chinese nine-dash line maritime sovereignty claims as such, because the Chinese Declarations had made that impossible. Instead, the Philippines cleverly sought a South China Sea Arbitration ruling concerning
the role of historic rights and the source of maritime entitlements in the South China Sea, the status of certain maritime features and the maritime entitlements they are capable of generating, and the lawfulness of certain actions by China that were alleged by the Philippines to violate the Convention’. 
The last point related to environmental damage to the rocks and reefs.
An independent Arbitral Tribunal was set up in 2013 under the auspices of the Permanent Court of Arbitration (PCA) in The Hague. China did not accept this compulsory arbitration and protested that the Tribunal lacked jurisdiction under UNCLOS. The PCA decided that jurisdiction existed for compulsory arbitration of the case brought by Philippines, under Section 2 of Chapter 15 of UNCLOS and under Annex VII which provides that the absence of one party shall not prevent a compulsory arbitration.
The Philippines appointed a German judge as one of a panel of five arbitrators. A Japanese judge, then President of the Hamburg-based International Tribunal of the Law of the Sea, appointed the other four arbitrators, from Ghana (chair), France, Poland and Netherlands.
The Philippines did not ask the Tribunal to rule on China’s historically based sovereignty claims. The Tribunal condemned China’s reclamation actions and the creation of artificial islands out of named semi-submerged geographical features. It ruled that only naturally habitable and inhabited islands in the South China Sea can generate maritime sovereignty and economic zones. It criticised Chinese actions in creating environmentally damaging artificial islands.
China condemned the Philippines recourse to compulsory arbitration as an act of bad faith and an abuse of UNCLOS dispute settlement procedures. On this, the Chinese White Paper says:
On 22 January 2013, the then government of the Republic of the Philippines unilaterally initiated the South China Sea arbitration. In doing so, the Philippines has turned its back on the consensus reached and repeatedly reaffirmed by China and the Philippines to settle through negotiation the relevant disputes in the South China Sea …
Deliberately packaging the relevant disputes as mere issues concerning the interpretation or application of UNCLOS while knowing full well that territorial disputes are not subject to UNCLOS and that maritime delimitation disputes have been excluded from the UNCLOS compulsory dispute settlement procedures by China’s 2006 declaration, the Philippines has wantonly abused the UNCLOS dispute settlement procedures. This initiation of arbitration aims not to settle its disputes with China, but to deny China’s territorial sovereignty and maritime rights and interests in the South China Sea. This course of conduct is taken out of bad faith …
In 2006, pursuant to Article 298 of UNCLOS, China made an optional exceptions declaration excluding from the compulsory dispute settlement procedures of UNCLOS disputes concerning, among others, maritime delimitation, historic bays or titles, military and law enforcement activities. Such declarations made by about 30 states, including China, form an integral part of the UNCLOS dispute settlement mechanism. By camouflaging its submissions, the Philippines deliberately circumvented the optional exceptions declaration made by China and the limitation that land territorial disputes are not subject to UNCLOS, and unilaterally initiated the arbitration. This course of conduct constitutes an abuse of the UNCLOS dispute settlement procedures.’
China’s anger extends not just to the Philippines but to the whole PCA machinery for supporting the compulsory arbitration of this case, ignoring China’s profound and repeated objections. I think as a layman that the Chinese complaint has merit. The PCA had accepted the Philippines’ offer to pay China’s share of the costs so that the arbitration could proceed. The Philippines selected the German judge and the four other judges were selected by a Japanese judge in The Hague whom China viewed as anti-Chinese. None of the judges were from the Asian region.
Professor Natalie Klein, Dean of Macquarie Law School, Macquarie University Sydney commented in a paper delivered in Hong Kong two days after the ruling:
The Philippines was quite clever in how it framed its case. While it seemed inherently problematic to address questions of entitlement without knowing who was entitled, the Tribunal sought to avoid this issue at every turn. The final award in the South China Sea arbitration emphasized that it was not resolving any question of territorial sovereignty. It remains to be seen if any party still attempts to use the decision for this purpose.
The Tribunal outcome was widely interpreted internationally as a blow to China’s territorial claims in the South China Sea. China was condescendingly lectured to by many, including the Australian Foreign Mister who said that if China wanted to be internationally respected it must now accept the ‘binding’ outcome of this compulsory arbitration. Of course, Julie Bishop knows that China will do no such thing: she was simply scoring points, and turning the knife in the Chinese wound.
Most international lawyers whom I have read or consulted have said that what was done to China was technically correct under UNCLOS, and might give the Philippines useful ammunition in future negotiations with China. But I think this might misread the Chinese mentality.
To me, this was about a clever process to exploit ambiguities and fluidities under UNCLOS to mock the maritime claims of a proud and historically wounded great nation: and to set up China as an international outlaw if it does not respect this questionably secured ruling. Philippines has won a battle but I cannot see it winning this war. In the long run, China will go on building up islands, and Philippines will have to go back to bilateral negotiations. Maybe its position will have been somewhat strengthened by the PCA ruling: or maybe China will be so angry that it makes even less concessions to the Philippines. Only time will tell.
Until the Western colonial era, the South China Sea was indeed China’s mare nostrum. Powerful Chinese navies and trading fleets regularly crossed this semi-enclosed sea. Southeast Asian kingdoms paid regular tribute to China. Western naval and mercantile penetration after around 1600 made it high seas. This dispute cannot be understood without an eye on China’s bitter memories of its early hegemony and its subsequent penetration and humiliation by Western powers in the 19th and 20th centuries.
To my mind, China has now been tricked by some very clever legal footwork, possibly extending to within the PCA machinery itself, into appearing internationally to be in the wrong. It has had to suffer insulting public comparisons with the lessons learned by Western appeasement of Nazi aggression in the 1930s , and the need to stand up against its international bullying.
To me, this is wrong and potentially dangerous. The West should have handled this better. This outcome is not a victory for international law. It is an exacerbation of dangerous great power tensions.
And – to cap it all off – the country that no doubt advised and orchestrated the whole case is itself not a signatory to UNCLOS. The Philippines’ lawyers were based in Washington and New York. United States exceptionalism rides roughshod over the world again.
Tony Kevin was a former Australian Ambassador to Cambodia and Poland.
 The South China Sea Arbitration, Permanent Court of Arbitration Press Release, The Hague, 12 July 2016 . https://pca-cpa.org/wp-content/uploads/sites/175/2016/07/PH-CN-20160712-Press-Release-No-11-English.pdf
 ‘China Adheres to the Position of Settling Through Negotiation the Relevant Disputes Between China and the Philippines in the South China Sea, Chinese Government White Paper, 13 July 2016. http://english.gov.cn/state_council/ministries/2016/07/13/content_281475392503075.htm
 My thanks to Professors Natalie Klein and Tim Stephens.
 ‘Nine-dash line’, Wikipedia file
 Op.cit, ref1.
 Op.cit. ref 2, paras 115-118.
 Expansions and Restrictions in the UNCLOS Dispute Settlement Regime: Lessons from Recent Decisions. paper provided by Professor Klein in private communication with me.