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South China Sea: Philippines v. China

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South China Sea: Philippines v. China

Post by VALUEPICK on Sat Aug 01, 2015 11:41 am

http://thediplomat.com/2015/07/south-china-sea-philippines-v-china/

south China Sea: Philippines v. China

Legal questions regarding China’s non-participation in the Philippines v. China arbitration.

By Lan Nguyen
July 27, 2015


The Philippines v. China case before the arbitral tribunal set up under Annex VII of the 1982 United Nations Convention on the Law of the Sea (UNCLOS) has attracted worldwide attention for a number of reasons, one of which being China’s refusal to participate in the proceedings, which were initiated by the Philippines.


The non-appearance of a party before an international court or tribunal is not uncommon, nor is this the first time a party has chosen not to appear before an UNCLOS dispute settlement body. In 2013, Russia elected to stay away from both provisional measures proceeding before the International Tribunal for the Law of the Sea (ITLOS) and currently, as things stand, it is not appearing before the Annex VII arbitral tribunal in the Arctic Sunrise case initiated by the Netherlands. What is peculiar about Philippines v. China, however, is that even though China has officially made it public that it would not participate in the proceedings, it has missed no opportunity to make the details of its position known through both formal and informal channels. This situation gives rise to several interesting legal questions.

Can China choose not to participate?


Even though international law imposes on States an obligation to settle disputes peacefully, when it comes to international adjudication or arbitration, States retain the right to decide whether to take part in it or not. The decision to not participate in legal proceedings of course begs the question of good faith, nevertheless it has to be acknowledged that international law allows for States to do so. In this particular case, Article 9 of Annex VII UNCLOS, Default of appearance, and Article 25 of the Rule of Procedure of the Arbitral Tribunal envision a situation in which one of the parties fails to appear before the tribunal. However, both of these articles state that the non-appearance of one party will not constitute a bar to the proceedings and at the same time require the tribunal to “satisfy itself that it has jurisdiction and that claim is well founded in fact and in law.”


It should be noted, however, that China’s refusal to appear before the tribunal does not negate the consent that it has given to the compulsory jurisdiction of the arbitral tribunal when becoming a party to the UNCLOS. The use of the argument that the arbitral tribunal does not have jurisdiction as a reason to not participate in the proceedings is highly ungrounded to say the least, and was indeed struck down by the arbitral tribunal in theArctic Sunrise case against Russia. China remains a party to the case unless and until the Tribunal finds that there is no jurisdiction.


What are the impacts of China’s communications?


Despite the official position that “it does not accept the arbitration initiated by the Philippines,” China has hardly adopted a hands-off policy towards the arbitral proceedings. China has through different channels made its position on the jurisdiction of the tribunal known to the public, while remaining silent on the merits of the case. Officially, the Chinese government issued a “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,” in which China elaborated in rather detailed arguments the reasons why it believes the arbitral tribunal does not have jurisdiction. In addition, Chinese scholars have been very active in publishing books and articles arguing against the jurisdiction of the tribunal and the case as a whole. One of these publications explicitly stated that it was “to serve as a kind of amicus curiae brief advancing possible legal arguments on behalf of the absent respondent.”


In practice, the International Court of Justice (ICJ), which has had the opportunity to deal with the non-appearance of the respondent in a handful of instances, has generally taken account of communications from non-appearing States. The Court usually refers to them to ascertain the arguments which the non-appearing State would have sought to put forward had it appeared in the proceeding. The arbitral tribunal in this case seems to be taking a similar approach. In its Press Release, the tribunal stated that it will “treat China’s communications (including the Position Paper) as constituting a plea concerning the Arbitral Tribunal’s jurisdiction.”


China, therefore, benefits both from making the tribunal aware of its arguments and maintaining that it does not recognize the tribunal’s legitimacy and outcome. This of course raises the question of fairness for the appearing State, the Philippines, which has duly complied with all the procedural requirements placed upon it.


One may argue, however, that if we look at the situation from a different angle, would it be better if China remained completely silent? As desirable as the participation and cooperation from the parties to the case may be, the fact of the matter is that China has determinatively refused to accept arbitration and the arbitral tribunal still needs to ascertain the view of both sides. As a result, some indications of the respondent’s objections might be helpful as a point of departure. For the Philippines, that China is making its position known in some way will reduce the amount of guesswork involved and enable it to deal with their counter-arguments in its pleadings more thoroughly. This appears to be exactly what the Philippines did in the oral proceedings early July. Be that as it may, the informal communications cannot and should not substitute for China’s actual presence before the tribunal, in the interests of justice and the cardinal principle of pacta sunt servanda under international law.


China’s position to date has only concerned jurisdictional issues. This seems to be consistent with China’s long-standing policy of “deliberate ambiguity” surrounding its claims in the South China Sea. It is unlikely, therefore, that China would elaborate on its position regarding the merits, supposing that the tribunal found jurisdiction and proceeded to this phase. This is a case in which the tribunal is faced with an incredibly large number of technical details and facts, judging from the Philippines’ reportedly 4000-page Memorial. Hence it seems that China’s non-participation in the merits phase will pose more difficulties for the arbitration than it does in the jurisdictional phase.


What are the consequences of China’s non-appearance?


Legally speaking, the existence of Article 9 Annex VII and Rule 25 of the Rules of Procedure is designed to prevent any adverse consequences imposed on a non-appearing party in the course of the proceedings. As noted, the non-appearing party is still a party to the case and still bound by the decision of the tribunal whether it agrees with it or not.


However, the jurisprudence before international tribunals has indicated that the non-appearing party has to accept that it cannot expect the tribunal to be fully aware of its position, as it would be if the party appeared. This remains true even if it has made its position known through other communications. The ICJ in theNicaragua case stated that it “cannot by its own enquiries entirely make up for the absence of one of the Parties” and that “absence, in a case . . . involving extensive questions of fact, must necessarily limit the extent to which the Court is informed of the facts.” This at first glance may seem to favor the Philippines, but as noted, the lack of Chinese cooperation may result in the lack of evidence sufficient for the tribunal to even reach a decision at all.


In the Artic Sunrise case, commentators have observed that the provisional measure that the ITLOS prescribed would probably not have been so much in favor of (or almost identical to) the Netherland’s request had Russia decided to appear and defend itself. Russia was arguably “punished” for its non-appearance with an order very much against its interests. In separate opinions, Judges Wolfrum and Kelly were highly critical of the non-appearing party. The judges pointed out that the international court or tribunal may in a situation of non-appearance “have to rely on the facts and the legal arguments presented by one side without having the benefit of hearing the other side. This cannot be fully compensated by recourse to facts which are in the public domain.” One way of understanding this statement is that, notwithstanding the requirements of Article 9, the judges may be more sympathetic to the viewpoint of the appearing party, simply because there is nothing from the other side to rebut it. It is open to question whether the arbitral tribunal in this case would react in the same manner as the ITLOS. It should be noted that the current arbitral tribunal comprises three ITLOS judges from the Artic Sunrise case and, interestingly, the Philippine’s lead counsel was also lead counsel in one of the most high-profile examples of non-appearance, the Nicaragua case. It will be interesting, therefore, to see what, if any, effect this dynamic may have on the outcome of the case.


What enforcement mechanism is available?


As mentioned, China’s decision to not appear before the arbitral tribunal does not relieve it from being a party to the dispute, which means the arbitral award will be final and binding on it. Unfortunately, however, the UNCLOS dispute settlement system does not contain an enforcement mechanism comparable to that of the ICJ with the Security Council, at least in theory. This means that should China refuse to comply with a decision perceived to be unfavorable to its interests, it is unlikely that there can be any legal sanctions against such non-compliance.


The reaction of non-appearing States in the aftermath of the decision has, however, varied. Despite affirming its rejection to the judgment of the Court, some non-appearing parties have eventually taken courses of action that were in compliance with the final award. For example, in the Artic Sunrise case, Russia announced that it would not comply with the provisional measure prescribed by ITLOS. However, nearly half a year after the provisional measure was handed down, it did release the activists and the ship, albeit – Moscow insisted – pursuant to a domestic decision and not the ITLOS order. Others seem much more defiant. In the Nicaragua case, the U.S. persistently defied the judgment of the ICJ and refused to enter into any negotiation with Nicaragua on compensation. Nicaragua attempted to enforce the judgment through various mechanisms including recourse to the Security Council, the General Assembly, and the Court again, with differing levels of success.


Does this mean that arbitration would be futile? After all, what is the use of pursuing such a costly and time-consuming case if the eventual award is destined to be ignored? In assessing the usefulness of litigation for the applicant, an examination of the applicant’s objectives in bringing the matter before the court is useful. Focusing solely on the question of how compliance should ideally have happened ignores the important question of the extent to which the rights of an applicant would have been or continue to be violated without a judgment. The Philippines in this case has stated that it regards the case not as the end to the South China Sea disputes, but as the beginning. This shows that the Philippines is fully aware of the extent to which the arbitral award may resolve all of the disputes. What the Philippines seems to be seeking is for China to have to clarify its claims and bring them into conformity with international law. This in itself is only the first step in untangling the South China Sea disputes and enabling the parties to settle the disputes on a more fair and equal footing. In dealing with a neighboring country that is stronger in all aspects, the arbitration is also a way to draw public attention to China’s claims and actions and to create international pressure on China to reconsider its position.


In short, China’s non-appearance before the Annex VII arbitral tribunal has in practice not stopped the arbitration from moving forward. China’s official position of rejecting arbitration does, however, seem rather rhetorical. The various other means by which China has advanced its arguments concerning the case have in effect created more of a quasi-appearance. Even if international law and precedence do not prohibit such a move, it does show a serious lack of good faith in efforts to achieve a peaceful resolution to highly complex disputes. This inconsistent stance has undoubtedly also made the arbitral proceedings more difficult than they already are.


Lan Nguyen is a Ph.D candidate at the Faculty of Law, University of Cambridge. She holds a LL.M from the University of Cambridge and has worked as a lecturer and researcher of international law at the Diplomatic Academy of Vietnam.
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