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7/9/2015 PositionPaperoftheGovernmentofthePeople'sRepublicofChinaontheMatterofJurisdictionintheSouthChinaSeaArbitrationInitiatedbytheRepubli

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PositionPaperoftheGovernmentofthePeople'sRepublicofChinaontheMatterofJurisdictionintheSouthChinaSeaArbitrationInitiatedbytheRepublicofthePhilippines

2014/12/07

7December2014

I.Introduction

1. On 22 January 2013, the Department of Foreign Affairs of the Republic of the Philippines presented a note verbale to the Embassy of the People'sRepublicofChina in thePhilippines,stating that thePhilippinessubmittedaNotificationandStatementofClaim inorder to initiatecompulsoryarbitrationproceedingsunderArticle287andAnnexVIIoftheUnitedNationsConventionontheLawoftheSea("Convention")withrespecttothedisputewithChinaover "maritime jurisdiction" in theSouthChinaSea.On 19 February 2013, theChineseGovernment rejected and returned thePhilippines' note verbaletogetherwiththeattachedNotificationandStatementofClaim.TheChineseGovernmenthassubsequentlyreiteratedthatitwillneitheracceptnorparticipateinthearbitrationthusinitiatedbythePhilippines.

2.ThisPositionPaper is intendedtodemonstrate that thearbitral tribunalestablishedat therequestof thePhilippines for thepresentarbitration("ArbitralTribunal")doesnothavejurisdictionoverthiscase.ItdoesnotexpressanypositiononthesubstantiveissuesrelatedtothesubjectmatterofthearbitrationinitiatedbythePhilippines.NoacceptancebyChinaissignifiedinthisPositionPaperoftheviewsorclaimsadvancedbythePhilippines,whetherornottheyarereferredtoherein.NorshallthisPositionPaperberegardedasChina'sacceptanceoforparticipationinthisarbitration.

3.ThisPositionPaperwillelaborateonthefollowingpositions:

TheessenceofthesubjectmatterofthearbitrationistheterritorialsovereigntyoverseveralmaritimefeaturesintheSouthChinaSea,whichisbeyondthescopeoftheConventionanddoesnotconcerntheinterpretationorapplicationoftheConvention

ChinaandthePhilippineshaveagreed,throughbilateralinstrumentsandtheDeclarationontheConductofPartiesintheSouthChinaSea,tosettletheirrelevantdisputesthroughnegotiations.Byunilaterallyinitiatingthepresentarbitration,thePhilippineshasbreacheditsobligationunderinternationallaw

Evenassuming,arguendo,thatthesubjectmatterofthearbitrationwereconcernedwiththeinterpretationorapplicationoftheConvention,thatsubjectmatterwouldconstituteanintegralpartofmaritimedelimitationbetweenthetwocountries, thusfallingwithinthescopeof thedeclarationfiledbyChinain2006 in accordance with the Convention, which excludes, inter alia, disputes concerning maritime delimitation from compulsory arbitration and othercompulsorydisputesettlementprocedures

Consequently,theArbitralTribunalmanifestlyhasnojurisdictionoverthepresentarbitration.Basedontheforegoingpositionsandbyvirtueofthefreedomof every State to choose themeans of dispute settlement, China's rejection of and nonparticipation in the present arbitration stand on solid ground ininternationallaw.

II.TheessenceofthesubjectmatterofthearbitrationistheterritorialsovereigntyoverseveralmaritimefeaturesintheSouthChinaSea,whichdoesnotconcerntheinterpretationorapplicationoftheConvention

4.Chinahas indisputable sovereigntyover theSouthChinaSea Islands (theDongsha Islands, theXisha Islands, theZhongsha Islandsand theNanshaIslands)andtheadjacentwaters.ChineseactivitiesintheSouthChinaSeadatebacktoover2,000yearsago.Chinawasthefirstcountrytodiscover,name,exploreandexploit the resourcesof theSouthChinaSea Islandsand the first to continuouslyexercise sovereignpowersover them.From the1930s to1940s,JapanillegallyseizedsomepartsoftheSouthChinaSeaIslandsduringitswarofaggressionagainstChina.AttheendoftheSecondWorldWar,theChineseGovernment resumedexerciseofsovereigntyover theSouthChinaSea Islands.Militarypersonnelandgovernmentofficialsweresentvianavalvesselstoholdresumptionofauthorityceremonies.Commemorativestonemarkerswereerected,garrisonsstationed,andgeographicalsurveysconducted.In1947,Chinarenamedthemaritimefeaturesof theSouthChinaSeaIslandsand, in1948,publishedanofficialmapwhichdisplayedadotted line intheSouthChinaSea.Since the foundingof thePeople'sRepublicofChinaon1October1949, theChineseGovernmenthasbeenconsistentlyandactivelymaintainingitssovereigntyovertheSouthChinaSeaIslands.BoththeDeclarationoftheGovernmentofthePeople'sRepublicofChinaontheTerritorialSea

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of1958and theLawof thePeople'sRepublicofChinaon theTerritorialSeaand theContiguousZoneof1992expresslyprovide that the territoryof thePeople'sRepublicofChina includes,amongothers, theDongsha Islands, theXisha Islands, theZhongsha Islandsand theNansha Islands.All thoseactsaffirmChina'sterritorialsovereigntyandrelevantmaritimerightsandinterestsintheSouthChinaSea.

5.Priortothe1970s,PhilippinelawhadsetclearlimitsfortheterritoryofthePhilippines,whichdidnotinvolveanyofChina'smaritimefeaturesintheSouthChinaSea.Article1ofthe1935ConstitutionoftheRepublicofthePhilippines,entitled"TheNationalTerritory",providedthat"ThePhilippinescomprisesallthe territory ceded to theUnitedStates by theTreaty ofParis concludedbetween theUnitedStates andSpain on the tenth day ofDecember, eighteenhundredandninetyeight,thelimitswhicharesetforthinArticleIIIofsaidtreaty,togetherwithalltheislandsembracedinthetreatyconcludedatWashingtonbetweentheUnitedStatesandSpainontheseventhdayofNovember,nineteenhundred,andthetreatyconcludedbetweentheUnitedStatesandGreatBritainon theseconddayofJanuary,nineteenhundredandthirty,andall territoryoverwhich thepresentGovernmentof thePhilippine Islandsexercisesjurisdiction."Under thisprovision, the territoryof thePhilippineswasconfined to thePhilippine Islands,havingnothing todowithanyofChina'smaritimefeaturesintheSouthChinaSea.PhilippineRepublicActNo.3046,entitled"AnActtoDefinetheBaselinesoftheTerritorialSeaofthePhilippines",whichwaspromulgatedin1961,reaffirmedtheterritorialscopeofthecountryaslaiddowninthe1935Constitution.

6. Since the 1970s, thePhilippines has illegally occupied a number ofmaritime features of China'sNansha Islands, includingMahuanDao, FeixinDao,ZhongyeDao,NanyaoDao,BeiziDao,XiyueDao,ShuanghuangShazhouandSilingJiao.Furthermore,itunlawfullydesignatedasocalled"KalayaanIslandGroup"toencompasssomeofthemaritimefeaturesofChina'sNanshaIslandsandclaimedsovereigntyoverthem,togetherwithadjacentbutvastmaritimeareas. Subsequently, it laid unlawful claim to sovereignty overHuangyanDao ofChina's Zhongsha Islands. In addition, thePhilippines has also illegallyexploredandexploitedtheresourcesonthosemaritimefeaturesandintheadjacentmaritimeareas.

7.ThePhilippines'activitiesmentionedabovehaveviolatedtheCharteroftheUnitedNationsandinternationallaw,andseriouslyencroacheduponChina'sterritorialsovereigntyandmaritimerightsand interests.Theyarenullandvoid in law.TheChineseGovernmenthasalwaysbeenfirmlyopposedto theseactionsofthePhilippines,andconsistentlyandcontinuouslymadesolemnrepresentationsandproteststothePhilippines.

8.ThePhilippineshassummarizeditsclaimsforarbitrationinthreecategories:

First,China'sassertionofthe"historicrights"tothewaters,seabedandsubsoilwithinthe"ninedashline"(i.e.,China'sdottedlineintheSouthChinaSea)beyondthelimitsofitsentitlementsundertheConventionisinconsistentwiththeConvention.

Second,China'sclaimtoentitlementsof200nauticalmilesandmore,basedoncertainrocks,lowtideelevationsandsubmergedfeaturesintheSouthChinaSea,isinconsistentwiththeConvention.

Third,China'sassertionandexerciseofrightsintheSouthChinaSeahaveunlawfullyinterferedwiththesovereignrights,jurisdictionandrightsandfreedomofnavigationthatthePhilippinesenjoysandexercisesundertheConvention.

9.Thesubjectmatterof thePhilippines'claims is inessenceoneof territorialsovereigntyoverseveralmaritimefeatures in theSouthChinaSea,which isbeyond thescopeof theConventionanddoesnotconcern the interpretationorapplicationof theConvention.Consequently, theArbitralTribunalhasnojurisdictionovertheclaimsofthePhilippinesforarbitration.

10.WithregardtothefirstcategoryofclaimspresentedbythePhilippinesforarbitration,itisobviousthatthecoreofthoseclaimsisthatChina'smaritimeclaimsintheSouthChinaSeahaveexceededtheextentallowedundertheConvention.However,whateverlogicistobefollowed,onlyaftertheextentofChina'sterritorialsovereigntyintheSouthChinaSeaisdeterminedcanadecisionbemadeonwhetherChina'smaritimeclaimsintheSouthChinaSeahaveexceededtheextentallowedundertheConvention.

11. It isageneralprincipleof international lawthatsovereigntyover landterritory is thebasisfor thedeterminationofmaritimerights.AstheInternationalCourtofJustice("ICJ")stated,"maritimerightsderivefromthecoastalState'ssovereigntyovertheland,aprinciplewhichcanbesummarizedas'thelanddominates thesea'" (MaritimeDelimitationandTerritorialQuestionsbetweenQatarandBahrain (Qatar v.Bahrain),Merits, Judgment of 16March2001,I.C.J. Reports 2001, p. 97, para. 185 cf. also North Sea Continental Shelf (Federal Republic of Germany/Denmark Federal Republic ofGermany/Netherlands),Judgmentof20February1969,I.C.J.Reports1969,p.51,para.96AegeanSeaContinentalShelf(Greecev.Turkey),JurisdictionoftheCourt,Judgmentof19December1978,I.C.J.Reports1978,p.36,para.86).And,"[i]tisthustheterrestrialterritorialsituationthatmustbetakenasstartingpointforthedeterminationofthemaritimerightsofacoastalState"(Qatarv.Bahrain,I.C.J.Reports2001,para.185TerritorialandMaritimeDisputebetweenNicaraguaandHonduras in theCaribbeanSea (Nicaraguav.Honduras), Judgmentof8October2007, I.C.J.Reports2007,p.696,para.113).RecentlytheICJagainemphasizedthat"[t]hetitleofaStatetothecontinentalshelfandtotheexclusiveeconomiczoneisbasedontheprinciplethatthelanddominatesthesea",andthat"thelandisthelegalsourceofthepowerwhichaStatemayexerciseoverterritorialextensionstoseaward"(TerritorialandMaritimeDispute(Nicaraguav.Colombia),Judgmentof19November2012,I.C.J.Reports2012,p.51,para.140).

12.Thepreambleof theConventionproclaims"thedesirabilityofestablishing throughthisConvention,withdueregard for thesovereigntyofallStates,alegalorderfortheseasandoceans".Itisapparentthat"dueregardforthesovereigntyofallStates"istheprerequisitefortheapplicationoftheConventiontodeterminemaritimerightsoftheStatesParties.

13.Asfarasthepresentarbitrationisconcerned,withoutfirsthavingdeterminedChina'sterritorialsovereigntyoverthemaritimefeaturesintheSouthChina



Sea,theArbitralTribunalwillnotbeinapositiontodeterminetheextenttowhichChinamayclaimmaritimerightsintheSouthChinaSeapursuanttotheConvention,nottomentionwhetherChina'sclaimsexceedtheextentallowedundertheConvention.ButtheissueofterritorialsovereigntyfallsbeyondthepurviewoftheConvention.

14.ThePhilippinesiswellawarethatatribunalestablishedunderArticle287andAnnexVIIoftheConventionhasnojurisdictionoverterritorialsovereigntydisputes. In an attempt to circumvent this jurisdictional hurdle and fabricate a basis for institution of arbitral proceedings, the Philippines has cunninglypackageditscaseinthepresentform.Ithasrepeatedlyprofessedthat itdoesnotseekfromtheArbitralTribunaladeterminationof territorialsovereigntyover certain maritime features claimed by both countries, but rather a ruling on the compatibility of China's maritime claims with the provisions of theConvention,sothatitsclaimsforarbitrationwouldappeartobeconcernedwiththeinterpretationorapplicationoftheConvention,notwiththesovereigntyover thosemaritime features. This contrived packaging, however, fails to conceal the very essence of the subjectmatter of the arbitration, namely, theterritorialsovereigntyovercertainmaritimefeaturesintheSouthChinaSea.

15.WithregardtothesecondcategoryofclaimsbythePhilippines,ChinabelievesthatthenatureandmaritimeentitlementsofcertainmaritimefeaturesintheSouthChinaSeacannotbeconsideredinisolationfromtheissueofsovereignty.

16.Inthefirstplace,withoutdeterminingthesovereigntyoveramaritimefeature,itisimpossibletodecidewhethermaritimeclaimsbasedonthatfeatureareconsistentwiththeConvention.

17.Theholderoftheentitlementstoanexclusiveeconomiczone("EEZ")andacontinentalshelfundertheConventionisthecoastalStatewithsovereigntyover relevant land territory.Whennotsubject toStatesovereignty,amaritime featurepersepossessesnomaritimerightsorentitlementswhatsoever. Inotherwords,onlytheStatehavingsovereigntyoveramaritimefeatureisentitledundertheConventiontoclaimanymaritimerightsbasedonthatfeature.OnlyafteraState'ssovereigntyoveramaritimefeaturehasbeendeterminedandtheStatehasmademaritimeclaimsinrespectthereof,couldthereariseadispute concerning the interpretationor applicationof theConvention, if anotherState questions the compatibility of those claimswith theConventionormakesoverlappingclaims.Ifthesovereigntyoveramaritimefeatureisundecided,therecannotbeaconcreteandrealdisputeforarbitrationastowhetherornotthemaritimeclaimsofaStatebasedonsuchafeaturearecompatiblewiththeConvention.

18.Inthepresentcase,thePhilippinesdeniesChina'ssovereigntyoverthemaritimefeaturesinquestion,withaviewtocompletelydisqualifyingChinafrommakinganymaritimeclaimsinrespectofthosefeatures.Inlightofthis,thePhilippinesisputtingthecartbeforethehorsebyrequestingtheArbitralTribunaltodetermine,evenbeforethematterofsovereigntyisdealtwith,theissueofcompatibilityofChina'smaritimeclaimswiththeConvention.Inrelevantcases,nointernationaljudicialorarbitralbodyhaseverappliedtheConventiontodeterminethemaritimerightsderivedfromamaritimefeaturebeforesovereigntyoverthatfeatureisdecided.

19.Secondly, in respectof theNansha Islands, thePhilippinesselectsonlya few featuresand requests theArbitralTribunal todecideon theirmaritimeentitlements.ThisisinessenceanattemptatdenyingChina'ssovereigntyovertheNanshaIslandsasawhole.

20.TheNanshaIslandscomprisesmanymaritimefeatures.ChinahasalwaysenjoyedsovereigntyovertheNanshaIslandsinitsentirety,notjustoversomefeaturesthereof.In1935,theCommissionoftheChineseGovernmentfortheReviewofMapsofLandandWaterspublishedtheMapofIslandsintheSouthChina Sea. In 1948, the Chinese Government published the Map of the Location of the South China Sea Islands. Both maps placed under China'ssovereigntywhatarenowknownastheNanshaIslandsaswellastheDongshaIslands,theXishaIslandsandtheZhongshaIslands.TheDeclarationoftheGovernmentofthePeople'sRepublicofChinaontheTerritorialSeaof1958declaredthattheterritoryofthePeople'sRepublicofChinaincludes,interalia,theNanshaIslands. In1983, theNationalToponymyCommissionofChinapublishedstandardnamesforsomeof theSouthChinaSeaIslands, includingthoseoftheNanshaIslands.TheLawofthePeople'sRepublicofChinaontheTerritorialSeaandtheContiguousZoneof1992againexpresslyprovidesthattheNanshaIslandsconstitutesapartofthelandterritoryofthePeople'sRepublicofChina.

21.InNoteVerbaleNo.CML/8/2011of14April2011addressedtoSecretaryGeneraloftheUnitedNations,thePermanentMissionofChinatotheUnitedNationsstatedthat"undertherelevantprovisionsofthe1982UnitedNationsConventionontheLawoftheSea,aswellastheLawofthePeople'sRepublicofChinaon theTerritorialSeaand theContiguousZone (1992)and theLawon theExclusiveEconomicZoneand theContinentalShelfof thePeople'sRepublicofChina(1998),China'sNanshaIslandsisfullyentitledtoTerritorialSea,ExclusiveEconomicZone(EEZ)andContinentalShelf."Itisplainthat,inordertodetermineChina'smaritimeentitlementsbasedontheNanshaIslandsundertheConvention,allmaritimefeaturescomprisingtheNanshaIslandsmustbetakenintoaccount.

22.ThePhilippines,byrequestingtheArbitralTribunaltodeterminethemaritimeentitlementsofonlywhatitdescribesasthemaritimefeatures"occupiedorcontrolledbyChina",hasineffectdissectedtheNanshaIslands.ItdeliberatelymakesnomentionoftherestoftheNanshaIslands,includingthoseillegallyseizedor claimedby thePhilippines. Its real intention is to gainsayChina's sovereignty over thewhole of theNansha Islands, deny the fact of its illegalseizureoforclaimonseveralmaritimefeaturesoftheNanshaIslands,anddistortthenatureandscopeoftheChinaPhilippinesdisputesintheSouthChinaSea.Inaddition,thePhilippineshasdeliberatelyexcludedfromthecategoryofthemaritimefeatures"occupiedorcontrolledbyChina"thelargestislandintheNanshaIslands,TaipingDao,whichiscurrentlycontrolledbytheTaiwanauthoritiesofChina.ThisisagraveviolationoftheOneChinaPrincipleandaninfringement of China's sovereignty and territorial integrity. This further shows that the second category of claims brought by the Philippines essentiallypertainstotheterritorialsovereigntydisputebetweenthetwocountries.



23.Finally,whetherornotlowtideelevationscanbeappropriatedisplainlyaquestionofterritorialsovereignty.

24. The Philippines asserts that some of the maritime features, about which it has submitted claims for arbitration, are lowtide elevations, thus beingincapableofappropriationasterritory.Astowhetherthosefeaturesareindeedlowtideelevations,thisPositionPaperwillnotcomment.Itshould,however,be pointed out that, whatever nature those features possess, the Philippines itself has persisted in claiming sovereignty over them since the 1970s. ByPresidentialDecreeNo.1596,promulgatedon11June1978,thePhilippinesmadeknownitsunlawfulclaimtosovereigntyoversomemaritimefeaturesintheNansha Islands including the aforementioned features, togetherwith the adjacent but vast areas ofwaters, seabed, subsoil, continentalmargin andsuperjacentairspace,andconstituted thevastareaasanewmunicipalityof theprovinceofPalawan,entitled "Kalayaan".Notwithstanding thatPhilippineRepublicActNo.9522of10March2009stipulatesthatthemaritimezonesforthesocalled"KalayaanIslandGroup"(i.e.,somemaritimefeaturesofChina'sNanshaIslands)and"ScarboroughShoal"(i.e.,China'sHuangyanDao)bedeterminedinawayconsistentwithArticle121oftheConvention(i.e.,theregimeof islands), thisprovisionwasdesignedtoadjust thePhilippines'maritimeclaimsbasedonthosefeatureswithintheaforementionedarea.TheActdidnotvarytheterritorialclaimofthePhilippinestotherelevantmaritimefeatures,includingthoseitallegedinthisarbitrationaslowtideelevations.InNoteVerbaleNo.000228,addressedtoSecretaryGeneraloftheUnitedNationson5April2011,thePhilippinePermanentMissiontotheUnitedNationsstatedthat,"theKalayaan Island Group (KIG) constitutes an integral part of the Philippines. The Republic of the Philippines has sovereignty and jurisdiction over thegeological features in theKIG."ThePhilippineshasmaintained, todate, itsclaim tosovereigntyover40maritime features in theNansha Islands,amongwhicharetheveryfeaturesitnowlabelsaslowtideelevations.ItisthusobviousthattheonlymotivebehindthePhilippines'assertionthatlowtideelevationscannotbeappropriatedistodenyChina'ssovereigntyoverthesefeaturessoastoplacethemunderPhilippinesovereignty.

25.Whetherlowtideelevationscanbeappropriatedasterritoryisinitselfaquestionofterritorialsovereignty,notamatterconcerningtheinterpretationorapplicationoftheConvention.TheConventionissilentonthisissueofappropriation.Inits2001JudgmentinQatarv.Bahrain,theICJexplicitlystatedthat,"International treaty law is silent on thequestionwhether lowtideelevations canbeconsidered tobe 'territory'.Nor is theCourt awareof auniformandwidespreadState practicewhichmight have given rise to a customary rulewhich unequivocally permits or excludes appropriation of lowtide elevations"(Qatarv.Bahrain,I.C.J.Reports2001,pp.101102,para.205)."Internationaltreatylaw"plainlyincludestheConvention,whichenteredintoforcein1994.Inits2012JudgmentinNicaraguav.Colombia,while theICJstatedthat"lowtideelevationscannotbeappropriated"(Nicaraguav.Colombia, I.C.J.Reports2012, p. 641, para. 26), it did not point to any legal basis for this conclusory statement. Nor did it touch upon the legal status of lowtide elevations ascomponentsofanarchipelago,orsovereigntyorclaimsofsovereignty thatmayhave longexistedoversuchfeatures inaparticularmaritimearea.Onallaccounts, the ICJ did not apply the Convention in that case. Whether or not lowtide elevations can be appropriated is not a question concerning theinterpretationorapplicationoftheConvention.

26.AstothethirdcategoryofthePhilippines'claims,ChinamaintainsthatthelegalityofChina'sactionsinthewatersoftheNanshaIslandsandHuangyanDaorestsonbothitssovereigntyoverrelevantmaritimefeaturesandthemaritimerightsderivedtherefrom.

27.ThePhilippinesallegesthatChina'sclaimtoandexerciseofmaritimerightsintheSouthChinaSeahaveunlawfullyinterferedwiththesovereignrights,jurisdictionandrightsandfreedomofnavigation,whichthePhilippinesisentitledtoenjoyandexerciseundertheConvention.Thepremiseforthisclaimmustbe that thespatialextentof thePhilippines'maritime jurisdiction isdefinedandundisputed,and thatChina'sactionshaveencroacheduponsuchdefinedareas.Thefactis,however,tothecontrary.ChinaandthePhilippineshavenotdelimitedthemaritimespacebetweenthem.Untilandunlessthesovereigntyovertherelevantmaritimefeaturesisascertainedandmaritimedelimitationcompleted,thiscategoryofclaimsofthePhilippinescannotbedecidedupon.

28.ItshouldbeparticularlyemphasizedthatChinaalwaysrespectsthefreedomofnavigationandoverflightenjoyedbyallStatesintheSouthChinaSeainaccordancewithinternationallaw.

29.Tosumup,byrequestingtheArbitralTribunaltoapplytheConventiontodeterminetheextentofChina'smaritimerightsintheSouthChinaSea,withoutfirsthavingascertainedsovereigntyover the relevantmaritime features,andby formulatingaseriesofclaims forarbitration to thateffect, thePhilippinescontravenesthegeneralprinciplesof international lawandinternational jurisprudenceonthesettlementof internationalmaritimedisputes.TodecideuponanyofthePhilippines'claims,theArbitralTribunalwouldinevitablyhavetodetermine,directlyorindirectly,thesovereigntyoverboththemaritimefeaturesinquestionandothermaritimefeaturesintheSouthChinaSea.Besides,suchadecisionwouldunavoidablyproduce,inpracticalterms,theeffectofamaritimedelimitation,whichwillbe furtherdiscussedbelow inPart IVof thisPositionPaper.Therefore,Chinamaintains that theArbitralTribunalmanifestlyhasnojurisdictionoverthepresentcase.

III.ThereexistsanagreementbetweenChinaandthePhilippinestosettletheirdisputesintheSouthChinaSeathroughnegotiations,andthePhilippinesisdebarredfromunilaterallyinitiatingcompulsoryarbitration

30.With regard to disputes concerning territorial sovereignty andmaritime rights, China has alwaysmaintained that they should be peacefully resolvedthrough negotiations between the countries directly concerned. In the present case, there has been a longstanding agreement betweenChina and thePhilippinesonresolvingtheirdisputesintheSouthChinaSeathroughfriendlyconsultationsandnegotiations.

31.UndertheJointStatementbetweenthePeople'sRepublicofChinaandtheRepublicofthePhilippinesconcerningConsultationsontheSouthChinaSeaandonOtherAreasofCooperation,issuedon10August1995,bothsides"agreedtoabideby"theprinciplesthat"[d]isputesshallbesettledinapeacefulandfriendlymannerthroughconsultationsonthebasisofequalityandmutualrespect"(Point1)that"agradualandprogressiveprocessofcooperationshallbeadoptedwithaviewtoeventuallynegotiatingasettlementofthebilateraldisputes"(Point3)andthat"[d]isputesshallbesettledbythecountriesdirectly



concernedwithoutprejudicetothefreedomofnavigationintheSouthChinaSea"(Point8).

32.TheJointStatementof theChinaPhilippinesExpertsGroupMeetingonConfidenceBuildingMeasures, issuedon23March1999,states that the twosidesreiteratedtheircommitmentto"[t]heunderstandingtocontinuetoworkforasettlementoftheirdifferencethroughfriendlyconsultations"(para.5),andthat"thetwosidesbelievethatthechannelsofconsultationsbetweenChinaandthePhilippinesareunobstructed.Theyhaveagreedthatthedisputeshouldbepeacefullysettledthroughconsultation"(para.12).

33.TheJointStatementbetweentheGovernmentofthePeople'sRepublicofChinaandtheGovernmentoftheRepublicofthePhilippinesontheFrameworkofBilateralCooperationintheTwentyFirstCentury,issuedon16May2000,statesinPoint9that,"ThetwosidescommitthemselvestothemaintenanceofpeaceandstabilityintheSouthChinaSea.Theyagreetopromoteapeacefulsettlementofdisputesthroughbilateralfriendlyconsultationsandnegotiationsinaccordancewithuniversallyrecognizedprinciplesofinternationallaw,includingthe1982UnitedNationsConventionontheLawoftheSea.Theyreaffirmtheiradherencetothe1995jointstatementbetweenthetwocountriesontheSouthChinaSea...".

34.TheJointPressStatementoftheThirdChinaPhilippinesExperts'GroupMeetingonConfidenceBuildingMeasures,dated4April2001,statesinPoint4that,"ThetwosidesnotedthatthebilateralconsultationmechanismtoexplorewaysofcooperationintheSouthChinaSeahasbeeneffective.TheseriesofunderstandingandconsensusreachedbythetwosideshaveplayedaconstructiveroleinthemaintenanceofthesounddevelopmentofChinaPhilippinesrelationsandpeaceandstabilityoftheSouthChinaSeaarea."

35. The mutual understanding between China and the Philippines to settle relevant disputes through negotiations has been reaffirmed in a multilateralinstrument. On 4 November 2002, Mr. Wang Yi, the then Vice Foreign Minister and representative of the Chinese Government, together with therepresentativesofthegovernmentsofthememberStatesoftheAssociationofSoutheastAsianNations("ASEAN"),includingthePhilippines,jointlysignedtheDeclarationontheConductofPartiesintheSouthChinaSea("DOC").Paragraph4oftheDOCexplicitlystatesthat,"ThePartiesconcernedundertaketoresolvetheirterritorialandjurisdictionaldisputesbypeacefulmeans...throughfriendlyconsultationsandnegotiationsbysovereignstatesdirectlyconcerned,inaccordancewithuniversallyrecognizedprinciplesofinternationallaw,includingthe1982UNConventionontheLawoftheSea."

36.FollowingthesigningoftheDOC,theleadersofChinaandthePhilippineshaverepeatedlyreiteratedtheircommitmenttothesettlementofdisputesbyway of dialogue. Thus, a JointPressStatement between theGovernment of thePeople'sRepublic ofChina and theGovernment of theRepublic of thePhilippines was issued on 3 September 2004 during the State visit to China by the then Philippine President Gloria MacapagalArroyo, which states inparagraph16that,"Theyagreedthattheearlyandvigorousimplementationofthe2002ASEANChinaDeclarationontheConductofPartiesintheSouthChinaSeawillpavethewayforthetransformationoftheSouthChinaSeaintoanareaofcooperation."

37.Between30Augustand3September2011,PresidentBenignoS.AquinoIIIofthePhilippinespaidaStatevisittoChina.On1September2011,thetwosides issued a Joint Statement between the People's Republic of China and the Republic of the Philippines, which, in paragraph 15, "reiterated theircommitment to addressing the disputes through peaceful dialogue" and "reaffirmed their commitments to respect and abide by the Declaration on theConduct of Parties in theSouthChinaSea signed byChina and theASEANmember countries in 2002". The Joint Statement, consequently, reaffirmedParagraph4oftheDOCrelatingtosettlementofrelevantdisputesbynegotiations.

38.Thebilateral instrumentsbetweenChinaandthePhilippinesrepeatedlyemploytheterm"agree"whenreferringtosettlementoftheirdisputesthroughnegotiations.Thisevincesaclear intention toestablishanobligationbetween the twocountries in this regard.Paragraph4of theDOCemploys the term"undertake",whichisalsofrequentlyusedininternationalagreementstocommitthepartiestotheirobligations.AstheICJobservedinitsJudgmentinBosniaandHerzegovinav.SerbiaandMontenegro,"[t]heordinarymeaningoftheword'undertake'istogiveaformalpromise,tobindorengageoneself,togiveapledgeorpromise,toagree,toacceptanobligation.It isawordregularlyusedintreatiessettingouttheobligationsoftheContractingParties.... It isnotmerelyhortatoryorpurposive"(ApplicationoftheConventiononthePreventionandPunishmentoftheCrimeofGenocide(BosniaandHerzegovinav.Serbiaand Montenegro), Judgment of 26 February 2007, I.C.J. Reports 2007, p. 111, para. 162). Furthermore, under international law, regardless of thedesignation or form the abovementioned instruments employ, as long as they intend to create rights and obligations for the parties, these rights andobligationsarebindingbetweentheparties(Cf.MaritimeDelimitationandTerritorialQuestionsbetweenQatarandBahrain(Qatarv.Bahrain), JurisdictionandAdmissibility,Judgmentof1July1994,I.C.J.Reports1994,pp.120121,paras.2226LandandMaritimeBoundarybetweenCameroonandNigeria(Cameroonv.Nigeria:EquitorialGuineaintervening),Judgmentof10October2002,I.C.J.Reports2002,pp.427,429,paras.258,262263).

39.TherelevantprovisionsintheaforementionedbilateralinstrumentsandtheDOCaremutuallyreinforcingandformanagreementbetweenChinaandthePhilippines.Onthatbasis,theyhaveundertakenamutualobligationtosettletheirrelevantdisputesthroughnegotiations.

40. By repeatedly reaffirming negotiations as themeans for settling relevant disputes, and by emphasizing that negotiations be conducted by sovereignStates directly concerned, the abovequoted provisions of the bilateral instruments and Paragraph 4 of the DOC obviously have produced the effect ofexcludinganymeansofthirdpartysettlement.Inparticular,theabovementionedJointStatementbetweenthePeople'sRepublicofChinaandtheRepublicof thePhilippines concerningConsultations on theSouthChinaSea and onOther Areas ofCooperation of 10August 1995 stipulates in Point 3 that "agradual and progressive process of cooperation shall be adopted with a view to eventually negotiating a settlement of the bilateral disputes". The term"eventually"inthiscontextclearlyservestoemphasizethat"negotiations"istheonlymeansthepartieshavechosenfordisputesettlement,totheexclusionofanyothermeansincludingthirdpartysettlementprocedures.AlthoughtheabovementionedbilateralinstrumentsandParagraph4oftheDOCdonotusesuchanexpressphraseas"excludeotherproceduresofdisputesettlement",asthearbitraltribunalintheSouthernBluefinTunaCasestatedinitsAward,



"theabsenceofanexpressexclusionofanyprocedure... isnotdecisive"(AustraliaandNewZealandv.Japan,AwardonJurisdictionandAdmissibility,4August 2000, p.97, para. 57). As discussed earlier, in respect of disputes relating to territorial sovereignty andmaritime rights, China always insists onpeacefulsettlementofdisputesbymeansofnegotiationsbetweenthecountriesdirectlyconcerned.China'spositiononnegotiationswasmadeclearandwellknowntothePhilippinesandotherrelevantpartiesduringthedraftingandadoptionoftheaforementionedbilateralinstrumentsandtheDOC.

41. Consequently, with regard to all the disputes between China and the Philippines in the South China Sea, including the Philippines' claims in thisarbitration,theonlymeansofsettlementasagreedbythetwosidesisnegotiations,totheexclusionofanyothermeans.

42.EvensupposingthatthePhilippines'claimswereconcernedwiththeinterpretationorapplicationoftheConvention,thecompulsoryprocedureslaiddowninsection2ofPartXVoftheConventionstillcouldnotbeapplied,giventheagreementbetweenChinaandthePhilippinesonsettlingtheirrelevantdisputesthroughnegotiations.

43.Article280oftheConventionstatesthat,"NothinginthisPartimpairstherightofanyStatesPartiestoagreeatanytimetosettleadisputebetweenthemconcerningtheinterpretationorapplicationofthisConventionbyanypeacefulmeansoftheirownchoice."Article281(1)providesthat,"IftheStatesPartieswhichareparties toadisputeconcerning the interpretationorapplicationof thisConventionhaveagreed toseeksettlementof thedisputebyapeacefulmeansoftheirownchoice,theproceduresprovidedfor inthisPartapplyonlywherenosettlementhasbeenreachedbyrecoursetosuchmeansandtheagreementbetweenthepartiesdoesnotexcludeanyfurtherprocedure."

44.Asanalysedabove,throughbilateralandmultilateralinstruments,ChinaandthePhilippineshaveagreedtosettletheirrelevantdisputesbynegotiations,withoutsettingany time limit for thenegotiations,andhaveexcludedanyothermeansofsettlement. In thesecircumstances, it isevident that,under theabovequoted provisions of the Convention, the relevant disputes between the two States shall be resolved through negotiations and there shall be norecoursetoarbitrationorothercompulsoryprocedures.

45.ThePhilippinesclaimsthat,thetwocountrieshavebeeninvolvedinexchangesofviewssince1995withregardtothesubjectmatterofthePhilippines'claimsforarbitration,withouthoweverreachingsettlement,andthat in itsview,thePhilippinesis justifiedinbelievingthat it ismeaninglesstocontinuethenegotiations,andthereforethePhilippineshastherighttoinitiatearbitration.Butthetruthisthatthetwocountrieshaveneverengagedinnegotiationswithregardtothesubjectmatterofthearbitration.

46.Underinternationallaw,generalexchangesofviews,withouthavingthepurposeofsettlingagivendispute,donotconstitutenegotiations.InGeorgiav.RussianFederation,theICJheldthat,"Negotiationsentailmorethantheplainoppositionoflegalviewsorinterestsbetweentwoparties,ortheexistenceofaseriesofaccusationsandrebuttals,oreventheexchangeofclaimsanddirectlyopposedcounterclaims.Assuch,theconceptof'negotiations'requiresat thevery least agenuineattemptbyoneof thedisputingparties toengage indiscussionswith theotherdisputingparty,witha view to resolving thedispute" (Applicationof the InternationalConventionon theEliminationofAllFormsofRacialDiscrimination (Georgia v.RussianFederation), PreliminaryObjections,Judgmentof1April2011,I.C.J.Reports2011,p.132,para.157).Inaddition,theICJconsideredthat"thesubjectmatterofthenegotiationsmustrelate to thesubjectmatterof thedisputewhich, in turn,mustconcern thesubstantiveobligationscontained in the treaty inquestion" (Ibid.,p.133,para.161).

47.TheSouthChinaSeaissueinvolvesanumberofcountries,anditisnoeasytasktosolveit.Uptothepresent,thecountriesconcernedarestillworkingtogether to create conditions conducive to its final settlement by negotiations. Against this background, the exchanges of views betweenChina and thePhilippines in relation to theirdisputeshaveso farpertained to responding to incidentsat sea in thedisputedareasandpromotingmeasures topreventconflicts, reduce frictions,maintain stability in the region, andpromotemeasuresof cooperation.Theyare far fromconstitutingnegotiationsevenon theevidencepresentedbythePhilippines.

48. In recent years, China has on a number of occasions proposed to the Philippines the establishment of a ChinaPhilippines regular consultationmechanismonmaritimeissues.Todate,therehasneverbeenanyresponsefromthePhilippines.On1September2011,thetwocountriesissuedaJointStatementbetweenthePeople'sRepublicofChinaandtheRepublicofPhilippines,reiteratingthecommitmenttosettlingtheirdisputesintheSouthChinaSea through negotiations. But, before negotiations could formally begin, the Philippines sent on 10 April 2012 a naval vessel to the waters of China'sHuangyanDao toseizeChinese fishingboats togetherwith theChinese fishermenonboard. In the faceof suchprovocations,Chinawas forced to takeresponsemeasurestosafeguarditssovereignty.Thereafter,ChinaonceagainproposedtothePhilippineGovernmentthatthetwosidesrestarttheChinaPhilippinesconsultationmechanismforconfidencebuildingmeasures.Thatproposalagainfellondeafears.On26April2012,thePhilippineDepartmentofForeignAffairsdeliveredanoteverbale to theChineseEmbassy in thePhilippines,proposingthat the issueofHuangyanDaobereferredtoa thirdpartyadjudicationbodyforresolutionandindicatingnowillingnesstonegotiate.On22January2013,thePhilippinesunilaterallyinitiatedthepresentcompulsoryarbitrationproceedings.

49.ThepreviousexchangesofviewsregardingtheSouthChinaSeaissuebetweenthetwocountriesdidnotconcernthesubjectmatterofthePhilippines'claimsforarbitration.Forinstance,thePhilippinescitedastatementreleasedbytheChineseForeignMinistryon22May1997regardingHuangyanDao,inorder to show that there exists between the two countries a dispute concerning the maritime rights of Huangyan Dao and that the two countries hadexchanged views with regard to that dispute. However, the Philippines deliberately omitted a passage from that statement, which reads: "The issue ofHuangyandaoisanissueofterritorialsovereigntythedevelopmentandexploitationoftheEEZisaquestionofmaritimejurisdiction,thenatureofthetwoissuesaredifferentandhencethe lawsandregulationsgoverningthemarealsodifferent,andtheyshouldnotbediscussedtogether.Theattemptof the



Philippineside tousemaritime jurisdictional rights to violate the territorial sovereigntyofChina isuntenable."Thispassagemakesclear the thrustof thestatement: thePhilippinesshallnotnegateChina'ssovereigntyoverHuangyanDaoonthepretext that it issituatedwithintheEEZof thePhilippines.Thisshowsthattheexchangeofviewsinquestionwascentredontheissueofsovereignty.

50. It should be further noted that, the Philippines has attempted to show that the subjectmatter of the exchanges of views between China and thePhilippines since 1995 concerns the interpretation or application of theConvention, but nothing could be farther from the truth than this.Historically, thePhilippines,byRepublicActNo.3046of17June1961,proclaimedaspartofitsterritorialseathevastareasofseabetweenthemostoutlyingislandsinthePhilippine archipelago and the treaty limits established in the Treaty of Paris concluded between the United States and Spain in 1898, among otherinternationaltreaties,thusclaimingabeltofterritorialseafarbeyond12nauticalmiles.ByPresidentialDecreeNo.1596promulgatedon11June1978,thePhilippinesmadeitsclaimforsovereigntyoverthesocalled"KalayaanIslandGroup"(i.e.,somemaritimefeaturesofChina'sNanshaIslands),togetherwiththeadjacentbutvastareasofwaters,seabed,subsoil,continentalmargin,andsuperjacentairspace.Asconcededby thePhilippines itself,onlywith theadoptionon10March2009ofRepublicActNo.9522did itbegin theongoingprocess toharmonize itsdomestic lawwith theConvention,withaview toeventuallyrelinquishingallitsmaritimeclaimsincompatiblewiththeConvention.ThatActprovided,forthefirsttime,thatthemaritimeareasofthesocalled"Kalayaan Island Group" (i.e., some maritime features of China's Nansha Islands) and "Scarborough Shoal" (i.e., China's Huangyan Dao) "shall bedetermined"soastobe"consistentwithArticle121"oftheConvention(i.e.,theregimeofislands).Therefore,giventhatthePhilippinesitselfconsidersthatonlyin2009diditstarttoabandonitsformermaritimeclaimsinconflictwiththeConvention,howcouldithavestartedin1995toexchangeviewswithChinaonmattersconcerningtheinterpretationorapplicationoftheConventionthatarerelatedtothepresentarbitration?

51.ThePhilippinesclaimsthatChinacannotinvokeParagraph4oftheDOCtoexcludethejurisdictionoftheArbitralTribunal,givenitsowngravebreachofthe termsof theDOC.This isgroundless. Insupportof itsallegationsagainstChina, thePhilippinesclaims thatChinahas takenmeasures including thethreatofforcetodriveawayPhilippinefishermenfromthewatersofHuangyanDaoinspiteoftheir longstandingandcontinuousfishingactivitiesinthosewaters, and that China has blocked the Philippines from resupplying a naval ship which ran and has stayed aground at Ren'ai Jiao and certain navypersonnelonboard.Butthefactisthat,regardingthesituationatHuangyanDao,itwasthePhilippinesthatfirstresortedtothethreatofforcebydispatchingon10April2012anavalvesseltodetainandarrestChinesefishingboatsandfishermeninthewatersofHuangyanDao.RegardingthesituationatRen'aiJiao,which isaconstituentpartofChina'sNanshaIslands, thePhilippines illegallyrananavalshipaground inMay1999at that featureonthepretextof"technical difficulties". China has made repeated representations to the Philippines, demanding that the latter immediately tow away the vessel. ThePhilippines, for its part, had on numerous occasionsmade explicit undertaking to China to tow away the vessel grounded due to "technical difficulties".However, forover15years, insteadof fulfilling thatundertaking, thePhilippineshasattempted toconstructpermanent installationsonRen'aiJiao.On14March2014,thePhilippinesevenopenlydeclaredthatthevesselwasdeployedasapermanentinstallationonRen'aiJiaoin1999.Chinahasbeenforcedtotakenecessarymeasuresinresponsetosuchprovocativeconduct.Inlightofthesefacts,thePhilippines'accusationsagainstChinaarebaseless.

52.WhileitdeniestheeffectofParagraph4oftheDOCforthepurposeofsupportingitsinstitutionofthepresentarbitration,thePhilippinesrecentlycalledonthepartiestotheDOCtocomplywithParagraph5oftheDOCandtoprovide"thefullandeffectiveimplementationoftheDOC",inaproposalmadeinitsDepartment of Foreign Affairs statement dated 1 August 2014. This selective and selfcontradictory tactic clearly violates the principle of good faith ininternationallaw.

53.TheprincipleofgoodfaithrequiresallStatestohonestlyinterpretagreementstheyenterintowithothers,nottomisinterpretthemindisregardoftheirauthenticmeaninginordertoobtainanunfairadvantage.Thisprincipleisofoverridingimportanceandis incorporatedinArticle2(2)oftheCharteroftheUnitedNations. It toucheseveryaspectof international law (Cf.SirRobert JenningsandSirArthurWatts (eds.),Oppenheim's InternationalLaw, 9th ed.,1992,vol.1,p.38).IntheNuclearTestsCase,theICJheldthat,"Oneofthebasicprinciplesgoverningthecreationandperformanceof legalobligations,whatever their source, is the principle of good faith. Trust and confidence are inherent in international cooperation" (Nuclear Tests Case (Australia v.France),Judgmentof20December1974,I.C.J.Reports1974,p.268,para.46).

54.Onthisoccasion,ChinawishestoemphasizethattheDOCisanimportantinstrument,adoptedbyChinaandtheASEANmemberStatesfollowingmanyyearsof arduousnegotiationson thebasisofmutual respect,mutual understandingandmutual accommodation.Under theDOC, theparties concernedundertake to resolve their territorial and jurisdictional disputes through friendly consultations and negotiations by sovereign States directly concerned. Inaddition,thepartiesreaffirmtheircommitmenttothepurposesandprinciplesoftheCharteroftheUnitedNations,the1982Convention,theTreatyofAmityandCooperationinSoutheastAsia,theFivePrinciplesofPeacefulCoexistence,andotheruniversallyrecognizedprinciplesof international lawwhichshallserveasthebasicnormsgoverningstatetostaterelations.ThePartiescommitthemselvestoexploringwaysforbuildingtrustandconfidenceinaccordancewiththeabovementionedprinciplesandonthebasisofequalityandmutualrespectreaffirmtheirrespectforandcommitmenttothefreedomofnavigationin,andoverflightabove, theSouthChinaSeaasprovidedforbyuniversallyrecognizedprinciplesof international law, includingthe1982Conventionandundertake toexercise selfrestraint in the conductof activities thatwould complicateorescalatedisputesandaffect peaceandstability including, amongothers,refrainingfromactionofinhabitingonthepresentlyuninhabitedislands,reefs,shoals,cays,andotherfeatures,andtohandletheirdifferencesinaconstructivemanner.TheDOCalsolistsanumberofwaystobuildtrustandareasofcooperationforthePartiesconcernedtoseekandexplorependingthepeacefulsettlementofterritorialandjurisdictionaldisputes.AsafollowuptotheDOC,thepartieshaveundertakentonegotiatea"CodeofConduct intheSouthChinaSea".

55.TheDOChasplayedapositiveroleinmaintainingstabilityintheSouthChinaSea,andinenhancingmaritimecooperation,buildingtrustandreducingmisgivingsbetweenChinaandtheASEANmemberStates.EveryprovisionoftheDOCconstitutesanintegralpartofthedocument.Todenythesignificance



oftheDOCwillleadtoaseriousretrogressionfromthecurrentrelationshipofcooperationbetweenChinaandtheASEANmemberStatesintheSouthChinaSea.

56. As a member of the ASEAN and having been involved throughout the consultations on the DOC, the Philippines should have fully appreciated thesignificanceoftheDOCforthepeacefulsettlementofthedisputesintheSouthChinaSeathroughnegotiations.Atpresent,inordertomaintainstabilityintheregion and create conditions for peaceful settlement of the South China Sea issue, China and the ASEAN member States have established workingmechanismstoeffectivelyimplementtheDOC,andhavebeenengagedinconsultationsregardingthe"CodeofConductintheSouthChinaSea".Byinitiatingcompulsoryarbitrationatthisjuncture,thePhilippinesisrunningcountertothecommonwishandjointeffortsofChinaandtheASEANmemberStates.Itsunderlyinggoalisnot,asthePhilippineshasproclaimed,toseekpeacefulresolutionoftheSouthChinaSeaissue,butrather,byresortingtoarbitration,toput political pressure on China, so as to deny China's lawful rights in the South China Sea through the socalled "interpretation or application" of theConvention,andtopursuearesolutionoftheSouthChinaSeaissueonitsownterms.ThisiscertainlyunacceptabletoChina.

IV.Evenassuming,arguendo,thatthesubjectmatterofthearbitrationwereconcernedwiththeinterpretationorapplicationoftheConvention,that subjectmatterwould still be an integral part ofmaritimedelimitationand,havingbeenexcludedby the 2006Declaration filedbyChina,couldnotbesubmittedforarbitration

57.PartXVof theConventionestablishes the right for theStatesParties to fileawrittendeclaration toexcludespecifiedcategoriesofdisputes from thecompulsorydisputesettlementproceduresaslaiddowninsection2ofthatPart.In2006ChinafiledsuchadeclarationinfullcompliancewiththeConvention.

58.On 25August 2006,China deposited, pursuant to Article 298 of theConvention,with SecretaryGeneral of theUnitedNations awritten declaration,statingthat,"TheGovernmentofthePeople'sRepublicofChinadoesnotacceptanyoftheproceduresprovidedforinsection2ofPartXVoftheConventionwithrespecttoallthecategoriesofdisputesreferredtoinparagraph1(a),(b)and(c)ofArticle298oftheConvention".Inotherwords,asregardsdisputesconcerningmaritimedelimitation,historicbaysortitles,militaryandlawenforcementactivities,anddisputes inrespectofwhichtheSecurityCouncilof theUnitedNationsisexercisingthefunctionsassignedtoitbytheCharteroftheUnitedNations,theChineseGovernmentdoesnotacceptanyofthecompulsorydispute settlement procedures laid down in section 2 of Part XV of theConvention, including compulsory arbitration.China firmly believes that themosteffectivemeansforsettlementofmaritimedisputesbetweenChinaanditsneighbouringStatesisthatoffriendlyconsultationsandnegotiationsbetweenthesovereignStatesdirectlyconcerned.

59.ChinaandthePhilippinesaremaritimeneighboursand"Stateswithoppositeoradjacentcoasts" inthesenseofArticles74and83oftheConvention.ThereexistsanissueofmaritimedelimitationbetweenthetwoStates.GiventhatdisputesbetweenChinaandthePhilippinesrelatingtoterritorialsovereigntyoverrelevantmaritimefeaturesremainunresolved,thetwoStateshaveyettostartnegotiationsonmaritimedelimitation.Theyhave,however,commencedcooperationtopavethewayforaneventualdelimitation.

60.On3September2004,thetwosidesissuedaJointPressStatementoftheGovernmentofthePeople'sRepublicofChinaandtheGovernmentoftheRepublicofthePhilippines,statingthat"[t]hetwosidesreaffirmedtheircommitmenttothepeaceandstabilityintheSouthChinaSeaandtheirreadinesstocontinue discussions to study cooperative activities like joint development pending the comprehensive and final settlement of territorial disputes andoverlappingmaritimeclaimsinthearea"(para.16).

61.TwodaysbeforetheissuanceoftheJointPressStatement,uponapprovalbybothgovernmentsandinthepresenceoftheHeadsofStateofthetwocountries, China National OffshoreOil Corporation and Philippine National Oil Company signed the "Agreement for JointMarine Seismic Undertaking inCertainAreasintheSouthChinaSea".On14March2005,theagreementwasexpandedtoatripartiteagreement,withtheparticipationofVietnamOilandGasCorporation. This is a good example of the constructive effortsmade by theStates concerned to enhance cooperation and create conditions for anegotiatedsettlementofthedisputesintheSouthChinaSea.ThemaritimeareacoveredbythatagreementiswithinthatcoveredinthepresentarbitrationinitiatedbythePhilippines.

62.On28April2005,duringaStatevisittothePhilippinesbythethenChinesePresidentHuJintao,ChinaandthePhilippinesissuedaJointStatementofthePeople'sRepublicofChinaandtheRepublicofthePhilippines,inwhichthetwosides"agreedtocontinueeffortstomaintainpeaceandstabilityintheSouthChinaSeaand...welcomedthesigningoftheTripartiteAgreementforJointMarineSeismicUndertakingintheAgreementAreaintheSouthChinaSeabyChinaNationalOffshoreOilCorporation,VietnamOilandGasCorporationandPhilippineNationalOilCompany"(para.16).

63. On 16 January 2007, during the official visit to the Philippines by the then Chinese PremierWen Jiabao, China and the Philippines issued a JointStatementof thePeople'sRepublicofChinaand theRepublicof thePhilippines,whichstated that "theTripartiteJointMarineSeismicUndertaking in theSouthChinaSeaservesasamodelforcooperationintheregion.Theyagreedthatpossiblenextstepsforcooperationamongthethreepartiesshouldbeexploredtobringcollaborationtoahigherlevelandincreasethemomentumoftrustandconfidenceintheregion"(para.12).

64. In lightof theabove, it isplain thatChinaand thePhilippineshavereachedmutualunderstanding toadvance final resolutionof the issueofmaritimedelimitation through cooperation. In any event, given China's 2006 declaration, the Philippines should not and cannot unilaterally initiate compulsoryarbitrationontheissueofmaritimedelimitation.

65.Tocoverupthemaritimedelimitationnatureof theChinaPhilippinesdisputeandtosidestepChina's2006declaration, thePhilippineshassplitupthedisputeofmaritimedelimitationintodiscreteissuesandselectedafewofthemforarbitration,requestingtheArbitralTribunaltorenderthesocalled"legal



interpretation"oneachofthem.

66.ItisnotdifficulttoseethatsuchlegalissuesasthosepresentedbythePhilippinesinthepresentarbitration,includingmaritimeclaims,thelegalnatureofmaritimefeatures,theextentofrelevantmaritimerights,andlawenforcementactivitiesatsea,areallfundamentalissuesdealtwithinpastcasesofmaritimedelimitationdecidedbyinternationaljudicialorarbitralbodiesandinStatepracticeconcerningmaritimedelimitation.Inshort,thoseissuesarepartandparcelofmaritimedelimitation.

67.Maritimedelimitation is an integral, systematic process.Articles 74and83of theConvention stipulate thatmaritimedelimitationbetweenStateswithoppositeoradjacentcoasts"shallbeeffectedbyagreementonthebasisof international law,asreferredto inArticle38oftheStatuteoftheInternationalCourtofJustice,inordertoachieveanequitablesolution".BothinternationaljurisprudenceandStatepracticehaverecognizedthatallrelevantfactorsmustbetakenintoaccounttoachieveanequitablesolution.Inthislight,theinternationallawapplicabletomaritimedelimitationincludesboththeConventionandgeneral international law.Under this body of law,maritime delimitation involves a consideration of not only entitlements, effect ofmaritime features, andprinciplesandmethodsofdelimitation,butalsoallrelevantfactorsthatmustbetakenintoaccount,inordertoattainanequitablesolution.

68.TheissuespresentedbythePhilippinesforarbitrationconstituteanintegralpartofmaritimedelimitationbetweenChinaandthePhilippines,and,assuch,canonlybeconsideredundertheoverarchingframeworkofmaritimedelimitationbetweenChinaandthePhilippines,andinconjunctionwithalltherelevantrightsandintereststhepartiesconcernedenjoyinaccordancewiththeConvention,generalinternationallaw,andhistoricalorlongstandingpracticeintheregion for overall consideration. The Philippines' approach of splitting its maritime delimitation dispute with China and selecting some of the issues forarbitration,ifpermitted,willinevitablydestroytheintegrityandindivisibilityofmaritimedelimitationandcontravenetheprinciplethatmaritimedelimitationmustbebasedoninternationallawasreferredtoinArticle38oftheICJStatuteandthat"allrelevantfactorsmustbetakenintoaccount".ThiswilladverselyaffectthefutureequitablesolutionofthedisputeofmaritimedelimitationbetweenChinaandthePhilippines.

69.Ostensibly,thePhilippinesisnotseekingfromtheArbitralTribunalarulingregardingmaritimedelimitation,butinsteadadecision,interalia,thatcertainmaritime featuresarepart of thePhilippines'EEZandcontinental shelf, and thatChinahasunlawfully interferedwith theenjoymentandexerciseby thePhilippinesofsovereignrightsinitsEEZandcontinentalshelf.ButthatobviouslyisanattempttoseekarecognitionbytheArbitralTribunalthattherelevantmaritimeareasarepartofthePhilippines'EEZandcontinentalshelf,inrespectofwhichthePhilippinesisentitledtoexercisesovereignrightsandjurisdiction.This isactuallyarequest formaritimedelimitationbytheArbitralTribunal indisguise.ThePhilippines'claimshave ineffectcoveredthemainaspectsandstepsinmaritimedelimitation.ShouldtheArbitralTribunaladdresssubstantivelythePhilippines'claims,itwouldamounttoadefactomaritimedelimitation.

70. The exclusionary declarations filed by the States Parties to theConvention under Article 298 of theConventionmust be respected. By initiating thepresentcompulsoryarbitrationasanattempttocircumventChina's2006declaration,thePhilippinesisabusingthedisputesettlementproceduresundertheConvention.

71.China's2006declaration,once filed,automaticallycomes intoeffect. Itseffect,asprescribedunderArticle299of theConvention, is that,without theconsentofChina,noStatePartycanunilaterallyinvokeanyofthecompulsoryproceduresspecifiedinsection2ofPartXVagainstChinainrespectofthedisputescoveredby thatdeclaration. In return,Chinasimultaneouslygivesup the right tounilaterally initiatecompulsoryproceduresagainstotherStatesPartiesinrespectofthesamedisputes.Therightsandobligationsarereciprocalinthisregard.

72.ThePhilippinesclaimsthat,havingchosennoneofthefourcompulsorydisputesettlementprocedureslistedunderArticle287oftheConvention,ChinaasaStatePartyshallthereforebedeemedtohaveacceptedcompulsoryarbitration.Thisisadeliberatelymisleadingargument.ThepurposeandtheeffectofChina's 2006 declaration is such that the disputes listed therein are fully excluded from the compulsory settlement procedures under theConvention.WhetherornotChinahasselectedanyof the fourcompulsoryproceduresunderArticle287,as longasadispute fallswithin thescopeofChina's2006declaration, China has already explicitly excluded it from the applicability of any compulsory procedures under section 2 of Part XV of the Convention,includingcompulsoryarbitration.

73.Although thePhilippines professes that the subjectmatter of the arbitration does not involve any dispute covered byChina's 2006declaration, sinceChinaholdsadifferentviewinthisregard,thePhilippinesshouldfirsttakeupthisissuewithChina,beforeadecisioncanbetakenonwhetherornotitcanbesubmittedforarbitration.ShouldthePhilippines'logicinitspresentformbefollowed,anyStatePartymayunilaterallyinitiatecompulsoryarbitrationagainstanotherStatePartyinrespectofadisputecoveredbythelatter'sdeclarationinforcesimplybyassertingthatthedisputeisnotexcludedfromarbitrationbythatdeclaration.ThiswouldrendertheprovisionsofArticle299meaningless.

74.SincetheentryintoforceoftheConvention,thepresentarbitrationisthefirstcaseinwhichaStatePartyhasunilaterallyinitiatedcompulsoryarbitrationin respectofadisputecoveredbyadeclarationofanotherStatePartyunderArticle298. If this twistedapproachof thePhilippinescouldbeacceptedasfulfilling theconditions for invokingcompulsoryarbitration, it couldbewell imagined thatanyof thedisputes listed inArticle298maybesubmitted to thecompulsory procedures under section 2 of Part XV simply by connecting them, using the Philippines' approach, with the question of interpretation orapplication of certain provisions of theConvention.Should the aboveapproachbe deemedacceptable, the questionwould then arise as towhether theprovisionsofArticle298couldstillretainanyvalue,andwhetherthereisanypracticalmeaningleftofthedeclarationssofarfiledby35StatesPartiesunderArticle298.Inlightoftheforegoingreasons,Chinacanonlyconcludethat,theunilateralinitiationbythePhilippinesofthepresentarbitrationconstitutesanabuseof the compulsoryproceduresprovided in theConventionandagrave challenge to the solemnity of thedispute settlementmechanismunder theConvention.



75.Tosumup,evenassumingthatthesubjectmatterofthearbitrationwereconcernedwiththeinterpretationorapplicationoftheConvention,itwouldstillbe an integral part of the dispute of maritime delimitation between the two States. Having been excluded by China's 2006 declaration, it could not besubmittedtocompulsoryarbitrationundertheConvention.

V. China's right to freely choose themeans of dispute settlementmust be fully respected, and its rejection of and nonparticipation in thepresentarbitrationissolidlygroundedininternationallaw

76.Underinternationallaw,everyStateisfreetochoosethemeansofdisputesettlement.ThejurisdictionofanyinternationaljudicialorarbitralbodyoveraninterStatedisputedependsonthepriorconsentofthepartiestothedispute.Thisisknownastheprincipleofconsentininternationallaw.ItwasonthebasisofthisprinciplethattheStatesparticipatingintheThirdUnitedNationsConferenceontheLawoftheSeareached,afterextendedandarduousnegotiations,acompromiseonPartXVrelatingtodisputesettlementasapackagedeal.

77.ThecompulsorydisputesettlementproceduresprovidedinPartXVoftheConventionapplyonlytodisputesconcerningtheinterpretationorapplicationofthe Convention. States Parties are entitled to freely choose the means of settlement other than those set out in Part XV. Articles 297 and 298 of theConvention,moreover,provideforlimitationsonandoptionalexceptionstotheapplicabilityofthecompulsoryprocedureswithregardtospecifiedcategoriesofdisputes.

78.ThebalanceembodiedintheprovisionsofPartXVhasbeenacriticalfactorforthedecisionofmanyStatestobecomepartiestotheConvention.AtthesecondsessionoftheThirdUnitedNationsConferenceontheLawoftheSea,AmbassadorReynaldoGalindoPohlofElSalvador,cochairoftheinformalgroup on the settlement of disputes, on introducing the first general draft on dispute settlement, emphasized the need for exceptions from compulsoryjurisdictionwithrespecttoquestionsdirectlyrelatedtotheterritorialintegrityofStates.Otherwise,ashasbeennoted,"anumberofStatesmighthavebeendissuadedfromratifyingtheConventionorevensigning it"(ShabtaiRosenneandLouisB.Sohn(eds.),UnitedNationsConventionontheLawof theSea1982:ACommentary,1989,vol.v,p.88,para.297.1).ItfollowsthattheprovisionsofPartXVmustbeinterpretedandappliedinsuchamannersoastopreservethebalanceinandtheintegrityofPartXV.

79.ChinahighlyvaluesthepositiveroleplayedbythecompulsorydisputesettlementproceduresoftheConventioninupholdingtheinternationallegalorderfortheoceans.AsaStatePartytotheConvention,Chinahasacceptedtheprovisionsofsection2ofPartXVoncompulsorydisputesettlementprocedures.Butthatacceptancedoesnotmeanthatthoseproceduresapplytodisputesofterritorialsovereignty,ordisputeswhichChinahasagreedwithotherStatesPartiestosettlebymeansoftheirownchoice,ordisputesalreadyexcludedbyArticle297andChina's2006declarationfiledunderArticle298.WithregardtothePhilippines'claimsforarbitration,Chinahasneveracceptedanyofthecompulsoryproceduresofsection2ofPartXV.

80.Byvirtueof theprincipleofsovereignty,parties toadisputemaychoose themeansofsettlementof theirownaccord.Thishasbeenaffirmedby theConvention.Article 280provides that, "Nothing in thisPart impairs the right of anyStatesParties to agreeat any time to settle a dispute between themconcerningtheinterpretationorapplicationofthisConventionbyanypeacefulmeansoftheirownchoice."

81.ThemeansthuschosenbytheStatesPartiestotheConventiontakespriorityoverthecompulsoryproceduressetforthinsection2ofPartXV.Article281(1)ofsection1ofPartXVprovidesthat,"IftheStatesPartieswhicharepartiestoadisputeconcerningtheinterpretationorapplicationofthisConventionhave agreed to seek settlement of the dispute by a peaceful means of their own choice, the procedures provided for in this Part apply only where nosettlementhasbeenreachedbyrecoursetosuchmeansandtheagreementbetweenthepartiesdoesnotexcludeanyfurtherprocedure."Article286statesthat, "Subject to section 3, any dispute concerning the interpretation or application of this Convention shall, where no settlement has been reached byrecoursetosection1,besubmittedattherequestofanypartytothedisputetothecourtortribunalhavingjurisdictionunderthissection."Accordingly,wherepartiestoadisputehavealreadychosenameansofsettlementandexcludedotherprocedures,thecompulsoryproceduresoftheConventionshallnotapplytothedisputeinquestion.

82.Thepriorityandsignificanceof themeansofdisputesettlementchosenbyStatesParties to theConventionhavebeen furtheraffirmed in thearbitralawardintheSouthernBluefinTunaCase.ThetribunalrecognizedthattheConvention"fallssignificantlyshortofestablishingatrulycomprehensiveregimeofcompulsory jurisdiction entailing binding decisions", and that "States Parties ... are permitted by Article 281(1) to confine the applicability of compulsoryproceduresofsection2ofPartXVtocaseswhereallpartiestothedisputehaveagreeduponsubmissionoftheirdisputetosuchcompulsoryprocedures"(Australia andNewZealand v. Japan, pp. 102103, para. 62).Were the provisions of section 1 of Part XV not compliedwith faithfully, it would result indeprivationof therightof theStatesParties to freelychoosemeansofpeacefulsettlementbasedonStatesovereignty.Thatwouldentailabreachof theprincipleofconsentandupsetthebalanceinandintegrityofPartXV.

83.Inexerciseofitspowertodecideonitsjurisdiction,anyjudicialorarbitralbodyshouldrespecttherightoftheStatesPartiestotheConventiontofreelychoosethemeansofsettlement.Article288(4)oftheConventionprovidesthat"[i]ntheeventofadisputeastowhetheracourtortribunalhasjurisdiction,themattershallbesettledbydecisionofthatcourtortribunal".ChinarespectsthatcompetenceofjudicialorarbitralbodiesundertheConvention.Equallyimportant,Chinawouldliketoemphasize,theexerciseofjudicialorarbitralpowershallnotderogatefromtherightoftheStatesPartiestochoosethemeansofsettlementoftheirownaccord,orfromtheprincipleofconsentwhichmustbefollowedininternationaladjudicationandarbitration.Chinaholdsthatthisistheconstraint that theArbitralTribunalmustabidebywhenconsideringwhetherornot toapplyArticle288(4) indetermining its jurisdiction in thepresentarbitration.Afterall, "thepartiesto thedisputearecompletemastersof theproceduretobeusedtosettle it" (ShabtaiRosenneandLouisB.Sohn(eds.),UnitedNationsConventionontheLawoftheSea1982:ACommentary,1989,vol.v,p.20,para.280.1).



84.China respects the rightofallStatesParties to invoke thecompulsoryprocedures inaccordancewith theConvention.At thesame time, itwouldcallattentiontoArticle300oftheConvention,whichprovidesthat,"StatesPartiesshallfulfilingoodfaiththeobligationsassumedunderthisConventionandshallexercisetherights,jurisdictionandfreedomsrecognizedinthisConventioninamannerwhichwouldnotconstituteanabuseofright."Whilebeingfullyawarethatitsclaimsessentiallydealwithterritorialsovereignty,thatChinahasneveracceptedanycompulsoryproceduresinrespectofthoseclaims,andthattherehas been an agreement existing between the two States to settle their relevant disputes by negotiations, the Philippines has nevertheless initiated, byunilateralaction,thepresentarbitration.ThissurelycontravenestherelevantprovisionsoftheConvention,anddoesnoservicetothepeacefulsettlementofthedisputes.

85.InviewofwhatisstatedaboveandinlightofthemanifestlackofjurisdictiononthepartoftheArbitralTribunal,theChineseGovernmenthasdecidednottoacceptorparticipateinthepresentarbitration,inordertopreserveChina'ssovereignrighttochoosethemeansofpeacefulsettlementofitsownfreewilland the effectiveness of its 2006 declaration, and to maintain the integrity of Part XV of the Convention as well as the authority and solemnity of theinternationallegalregimefortheoceans.ThispositionofChinawillnotchange.

VI.Conclusions

86.It is theviewofChinathat theArbitralTribunalmanifestlyhasno jurisdictionoverthisarbitration,unilaterally initiatedbythePhilippines,withregardtodisputesbetweenChinaandthePhilippinesintheSouthChinaSea.

Firstly,theessenceofthesubjectmatterofthearbitrationistheterritorialsovereigntyovertherelevantmaritimefeaturesintheSouthChinaSea,whichisbeyondthescopeoftheConventionandisconsequentlynotconcernedwiththeinterpretationorapplicationoftheConvention.

Secondly,thereisanagreementbetweenChinaandthePhilippinestosettletheirdisputesintheSouthChinaSeabynegotiations,asembodiedinbilateralinstrumentsandtheDOC.ThustheunilateralinitiationofthepresentarbitrationbythePhilippineshasclearlyviolatedinternationallaw.

Thirdly,evenassumingthatthesubjectmatterofthearbitrationdidconcerntheinterpretationorapplicationoftheConvention,ithasbeenexcludedbythe2006declarationfiledbyChinaunderArticle298oftheConvention,duetoitsbeinganintegralpartofthedisputeofmaritimedelimitationbetweenthetwoStates.

Fourthly,ChinahasneveracceptedanycompulsoryproceduresoftheConventionwithregardtothePhilippines'claimsforarbitration.TheArbitralTribunalshall fully respect the right of the States Parties to the Convention to choose the means of dispute settlement of their own accord, and exercise itscompetencetodecideon its jurisdictionwithintheconfinesof theConvention.Theinitiationof thepresentarbitrationbythePhilippines isanabuseof thecompulsorydisputesettlementproceduresundertheConvention.ThereisasolidbasisininternationallawforChina'srejectionofandnonparticipationinthepresentarbitration.

87.ChinaconsistentlyadherestothepolicyoffriendlyrelationswithitsneighbouringStates,andstrivesforfairandequitablesolutioninrespectofdisputesofterritorialsovereigntyandmaritimedelimitationbywayofnegotiationsonthebasisofequalityandtheFivePrinciplesofPeacefulCoexistence.Chinaholdsthatnegotiationsisalwaysthemostdirect,effective,anduniversallyusedmeansforpeacefulsettlementofinternationaldisputes.

88.After yearsof diplomatic efforts andnegotiations,Chinahas successfully resolved landboundarydisputeswith twelveout of its fourteenneighbours,delimitinganddemarcatingsome20,000kilometresinlengthoflandboundaryintheprocess,whichaccountsforover90%ofthetotallengthofChina'slandboundary.On25December2000,ChinaandVietnamconcluded, followingnegotiations, theAgreementbetween thePeople'sRepublicofChinaand theSocialistRepublicofVietNamontheDelimitationoftheTerritorialSeas,theExclusiveEconomicZonesandContinentalShelvesinBeibuBay,establishingamaritimeboundarybetweenthetwoStatesinBeibuBay.On11November1997,theAgreementonFisheriesbetweenthePeople'sRepublicofChinaandJapanwassigned.On3August2000,theAgreementonFisheriesbetweentheGovernmentofthePeople'sRepublicofChinaandtheGovernmentoftheRepublicofKoreawassigned.On24December2005,theAgreementbetweentheGovernmentofthePeople'sRepublicofChinaandtheGovernmentoftheDemocratic People's Republic of Korea for Joint Development of Oil Resources at Seawas signed. All these are provisional arrangements pending themaritimedelimitationbetweenChinaandthoseStates.

89. The facts show that, as long as States concerned negotiate in good faith and on the basis of equality and mutual benefit, territorial and maritimedelimitationdisputescanberesolvedproperlybetweenthem.ThisprincipleandpositionofChinaequallyapplytoitsdisputeswiththePhilippinesintheSouthChinaSea.

90.Chinadoesnotconsidersubmissionbyagreementofadispute toarbitrationasanunfriendlyact. In respectofdisputesof territorialsovereigntyandmaritimerights,unilateralresorttocompulsoryarbitrationagainstanotherState,however,cannotbetakenasafriendlyact,whentheinitiatingStateisfullyawareoftheoppositionoftheotherStatetotheactionandtheexistingagreementbetweenthemondisputesettlementthroughnegotiations.Furthermore,suchactioncannotberegardedasinconformitywiththeruleoflaw,asitrunscountertothebasicrulesandprinciplesofinternationallaw.Itwillnotinanywayfacilitateapropersettlementofthedisputebetweenthetwocountries.Insteaditwillunderminemutualtrustandfurthercomplicatethebilateralrelations.

91. Inrecentyears, thePhilippineshasrepeatedlytakennewprovocativeactions inrespectofHuangyanDaoandRen'aiJiao.Suchactionshavegravelyhindered mutual political trust between China and the Philippines, and undermined the amicable atmosphere for China and ASEAN member States toimplementtheDOCandconsultontheproposedCodeofConductintheSouthChinaSea.Infact,intheregionofSoutheastAsia,it isnotChinathathas



become"increasinglyassertive"itisthePhilippinesthathasbecomeincreasinglyprovocative.

92.TheissueoftheSouthChinaSeainvolvesanumberofStates,andiscompoundedbycomplexhistoricalbackgroundandsensitivepoliticalfactors.Itsfinalresolutiondemandspatienceandpoliticalwisdomfromallpartiesconcerned.Chinaalwaysmaintainsthatthepartiesconcernedshallseekproperwaysandmeansofsettlementthroughconsultationsandnegotiationsonthebasisofrespectforhistoricalfactsandinternationallaw.Pendingfinalsettlement,allpartiesconcernedshouldengageindialogueandcooperationtopreservepeaceandstabilityintheSouthChinaSea,enhancemutualtrust,clearupdoubts,andcreateconditionsfortheeventualresolutionoftheissue.

93.TheunilateralinitiationofthepresentarbitrationbythePhilippineswillnotchangethehistoryandfactofChina'ssovereigntyovertheSouthChinaSeaIslandsandtheadjacentwatersnorwillitshakeChina'sresolveanddeterminationtosafeguarditssovereigntyandmaritimerightsandinterestsnorwillitaffect thepolicyandpositionofChina toresolve therelevantdisputesbydirectnegotiationsandwork togetherwithotherStates in theregion tomaintainpeaceandstabilityintheSouthChinaSea.

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