YAN Yongling

Application of the Good Faith Principle to the SCS Arbitration Initiated by the Philippines Against China

YAN Yongling*

The principle of good faith, a basic principle of international law, is mainly manifested in the performance of international obligations, especially treaty obligations, in good faith. This principle plays a pivotal role in the conclusion, execution and interpretation of treaties, as well as the maintenance of the order of treaties and laws. From the Philippines’ initiation of the South China Sea (SCS) arbitration against China, to the Arbitral Tribunal’s acceptance and release of the final award of the arbitration, the case is loaded with violation of the good faith principle. In the SCS Arbitration, the Arbitral Tribunal and the Philippines, appearing to have reached a covert agreement, took advantage of the vacuum left by the 1982 United Nations Convention on the Law of the Sea (UNCLOS) to abuse their rights under the convention, and to arbitrarily coin all kinds of notions or standards unheard of, by employing all tricks of text interpretation in bad faith. By doing so, they intended to illegally jeopardize the legitimate rights and interests of China, the other party to the Arbitration, by utilizing the UNCLOS as a tool. The final award, which is founded on illegal reasoning, is obviously contrary to the object and purpose of the UNCLOS; it thus shall be considered without binding force. Collating the jurisprudential basis of the good faith principle and the relevant judicial practices, the paper aims to showcase the specif i c breaches of the principle in the SCS Arbitration fi led by the Philippines.

Sino-Philippine SCS Arbitration; Principle of good faith; Abuse of rights; Specif i c manifestation

I. Introduction

Nearly one year has been elapsed since the fi nal award for the Sino-Philippine South China Sea (SCS) Arbitration was released in July 2016. However, the inf l uences of the Arbitration on the parties to the Arbitration, some interested thirdparties, and the entire international community, are far reaching and profound. Such influences cannot be neglected. The Philippines, in accordance with Part XV and Annex VII of the 1982 United Nations Convention on the Law of the Sea (UNCLOS), initiated an arbitration against China in January 2013. An Arbitral Tribunal for the case was constituted in May of the same year, to which the Philippines conveyed its 15 Submissions. Then the Tribunal issued its Award on Jurisdiction and Admissibility in October 2015, declaring that it had jurisdiction over the case. Afterwards, the Tribunal and the Philippines “conspired” and spared no ef f orts to deliver an award favorable to the Philippines, which was ultimately issued on 12 July 2016. This Arbitration left, prima facie, no room for criticism, but is actually full of loopholes. The whole process of the Arbitration, from the Philippines’ initiation of the arbitration, to the continuing of the arbitral process, and then to the release of the final award, is riddled with deviations from the international law, abuses of procedures and unfairness. Among them, their violation of the good faith principle is most conspicuous.

Since the release of the final award, the Chinese government and scholars have never stopped demonstrating and criticizing the illegality of this award. They have offered a variety of constructive proposals, giving strong theoretical supports to China’s ef f orts to safeguard its legal rights and interests with respect to the SCS Islands. However, the better strengthening and protection of China’s legitimate rights, due to the far-reaching but harmful impacts of the case, demands deeper understanding of the pertinent theories of the international law. At present, many researches, despite of their professionalism, are carried out from a single perspective, mainly focusing on the procedures and the merits of the case, but rarely on some typical and authoritative theories relating to the case, such as the principle of good faith. The principle of good faith, being a basic principle of international law, primarily requires the parties concerned to perform their international obligations in good faith, especially the obligations under treaties. This principle plays a vital role in the conclusion, performance and interpretation of treaties, as well as the maintenance of the whole legal order. It also bears practical signif i cance to China’s safeguarding of its legitimate rights and interests to the SCSIslands. In this context, the paper, based on the legal theories and practices related to the principle of good faith, a general principle of international law, explores the application of the principle to the SCS Arbitration initiated by the Philippines. By doing so, it aims to provide more theoretical supports to China’s protection of its legal entitlements in the SCS, and also to inspire the international community to consider and pay more attention to the importance of this principle to the building and stability of the international order. Before embarking on the application of the good faith principle to the SCS Arbitration, the paper will fi rst collate and analyze the legal bases of the principle.

II. The Connotations, Status and Limitations of the Good Faith Principle

Theory guides practice. In order to discuss and explore the specif i c application of the good faith principle in international judicial practices, we should fi rst get to know and understand the basic theories in this regard, so that the goal of practice may not deviate from the object and purpose of theory. The jurisprudential basis for the good faith principle can help us probe into the status and the pivotal role of “good faith” in treaty interpretation and even the entire legal system. As the core element governing the interpretation of treaties, the good faith principle guides the whole process of treaty interpretation. And discharging international obligations in good faith is preconditioned on interpretation in good faith. The good faith principle, as a general legal principle and a basic principle of international law, not only governs the interpretation of certain terms or phrases under a treaty, but also, in some cases, often guides, limits, assesses, balances or regulates the elements and methods of interpretation, so that its substantial values and functions can come into play.

A. The Connotations of the Good Faith Principle

To understand the connotations of the good faith principle, we must fi rst def i ne the term “good faith”. The concept of good faith originated from private law and initially appeared to be linked with the notion of divine law.①George Mousourakis, Fundamentals of Roman Private Law, Berlin/Heidelberg: Springer, 2012, p. 34.“Good faith” is the modern-day English translation of the Latin phrase “bona fides”. In accordancewith the Oxford Dictionary of English Idioms, “good faith” means “the intention to do something right”, and its opposed term “bad faith” means lack of trust in human interactions and “a dishonest attitude”. This is a general explanation of the term “good faith”. As per the Black’s Law Dictionary (10th edition), “good faith” describes four kinds of state of mind denoting (a) honesty of belief or purpose, (b) faithfulness to one’s duty or obligation, (c) observance of reasonable commercial standards of fair dealings in trade or commerce; and (d) freedom from intention to defraud or seek an unconscionable advantage.①Bryan A. Garner ed., Black’s Law Dictionary, 10th edition, Eagan: Thomson West, 2014.This explanation unveils the basic meanings of good faith – “honesty” and “reasonableness”, and also indirectly excludes behaviors done in bad faith from the scope of good faith. The definitions of “good faith” offered by the two dictionaries above tend to understand “good faith” in the context of interactions between equal subjects, especially in private contractual or treaty relations, and generally demand such subjects to act honestly, so as to regulate their behaviors. Against this backdrop, the present-day principle of honesty and credibility was created. As a result, the notion“good faith” is sometimes misunderstood to be equivalent to and exchangeable with honesty and credibility. And some scholars even translated “good faith” into“诚信 (honesty and credibility)” in Chinese. However, honesty and credibility, actually, are only two of the elements inherent in the principle of good faith. In terms of etymology, honesty is not equal to good faith. Additionally, good faith covers much wider scope than honesty and credibility; the latter merely applies to agreement relationships. The principle of honesty and credibility covers the main content of the good faith principle, inter alia, on international law; for example,“good faith” in the provision “to perform international obligations in good faith”simply means “honesty and credibility”. Nevertheless, the principle of honesty and credibility alone is “not sufficient to implement the principle of justice in practice, since the creation and development of many rights and obligations are not preconditioned on the existence of an agreement.”②LUO Guoqiang, On the Noumena of International Law, Beijing: Law Press China, 2008, pp. 159, 164～165. (in Chinese)Therefore, the two principles should be differentiated from each other. Given that honesty and credibility are two elements of good faith, the principle of honesty and credibility is, certainly, a reasonable extension and concrete expression of the good faith principle. The former principle also has an inestimable status and role. It is argued that “goodfaith”, denoting “rationality and reasonableness”, is a highly abstract concept that is still developing. The concept governs treaties from the time of their conclusion and implementation, to the time of their interpretation.①FENG Shoubo, On the Treaty Interpretation in “Good Faith”: An Empirical Research on“Good Faith” in Art. 31.1 of VCLT, Pacif i c Journal, Vol. 22, No. 5, 2015, p. 3. (in Chinese)And some also asserted that “sometimes it seems little more than a synonym for ‘reasonable’”.②FENG Shoubo, On the Treaty Interpretation in “Good Faith”: An Empirical Research on“Good Faith” in Art. 31.1 of VCLT, Pacif i c Journal, Vol. 22, No. 5, 2015, p. 4. (in Chinese)In the Case Concerning Military and Paramilitary Activities in and against Nicaragua, when interpreting treaties, the International Court of Justice (ICJ) took into account the role of “good faith” and pointed out that “It appears from the requirements of good faith that they should be treated, by analogy, according to the law of treaties, which requires a reasonable time for withdrawal from or termination of treaties that contain no provision regarding the duration of their validity.”③Military and Paramilitary Activities in and against Nicaragua, Nicaragua v. United States of America, Jurisdiction and Admissibility, Judgment, ICJ Reports 1984, para. 63.

The principle of good faith has its origin in municipal law and was later incorporated into international law. Notably, its meanings on international law are identical with those on domestic law. As John F. O’Connor noted, “The principle of good faith in international law is a fundamental principle from which the rule pacta sunt servanda and other legal rules distinctively and directly related to honesty, fairness and reasonableness are derived, and the application of these rules is determined at any particular time by the compelling standards of honesty, fairness and reasonableness prevailing in the international community at that time.”④John F. O’Connor, Good Faith in International Law, Aldershot: Dartmouth Publishing Co. Ltd., 1991, p. 124.This explanation is consistent with the nature of good faith, which highly generalized the application of the principle of good faith in domestic and international laws. As early as in the 1954 Resolution of the Institute of International Law, when mentioning the six principles formulated by Sir Gerald Fitzmaurice, the Special Rapporteur (Waldock) proposed that good faith should be linked with two of the six principles: “principle of integration” and “principle of effectiveness”.⑤Richard K. Garadiner, Treaty Interpretation, Oxford: Oxford University Press, 2008, p. 169.In the International Law Commission debate about draft Article 72, the preponderant view was that “An interpretation given in good faith and taking account of the object and purpose of a treaty would always necessarily seek to give a meaning to the text.”⑥Richard K. Garadiner, Treaty Interpretation, Oxford: Oxford University Press, 2008, p. 170.Although the afore-mentioned resolution and draft did not expresslymention the principle of good faith, the views expressed there became the basic element and standard for the creation of a legal framework, which virtually are the epitome of the good faith principle. Here, the principle of good faith encompassed the elements of the doctrine of prohibition of abuse of rights and the protection of legitimate expectations, in addition to the doctrine of honesty and credibility. These in turn heighten a legal system’s legitimacy by placing each participant on equal ground. “No one participant may, following the acceptance of the agreement, alter the obligations so as to suit its own purposes only.”①Thomas Cottier and Krista N. Schefer, HAN Xiuli trans., GAO Bo proofread, Good Faith and the Protection of Legitimate Expectations in the WTO, Journal of International Economic Law, No. 3, 2005, p. 183. (in Chinese)

To sum up, the principle of good faith has always been a concept that is still developing, which has not become a unif i ed and precise notion so far. Nonetheless, this fact is without prejudice to the fundamental role that the principle plays in the international community, inter alia, in the construction and maintenance of the international legal order, because the principle represents the consensus of the international community, and really mirrors the pursuit of justice by each State. The contents and varieties of “good faith” cannot be exhausted, however, based on the practices in both international and national laws, we can unequivocally demonstrate that: the principle of good faith is a basic principle; “honesty and credibility”,“fairness” and “reasonableness” are the basic meanings or features of good faith; and violation of such features or requirements is a result of “bad faith”.

B. The Status and Role of the Good Faith Principle

Paragraph 3 of the Preamble of the 1969 Vienna Convention on the Law of Treaties (VCLT) states that all the parties to the convention “[note] that the principles of free consent and of good faith and the pacta sunt servanda rule are universally recognized”. This paragraph reveals the dominant role that the principle of good faith plays in the formation and performance of international legal duties.②ZHAO Jianwen, The Principle of Good Faith under Treaties, Contemporary Law Review, No. 4, 2013, p. 122. (in Chinese)It follows that to fulfill international obligations in good faith is a consensus reached by the States concerned at the time of the formation of law of treaties. In fact, when the international law was still in its infancy in the Europe, many wellknown publicists had always insisted and emphasized on the importance and statusof the good faith principle in international relations. For example, Hugo Grotius insisted that good faith demands that even pacta with enemies, pirates, rebels and inf i dels should be diligently kept.①Oliver Dörr and Kirsten Schmalenbach eds., Vienna Convention on the Law of Treaties: A Commentary, New York: Springer Science & Business Media, 2011, p. 435.With the development and advancement of each legal system in the world, the principle of good faith has drawn great attentions and respect. “Good faith [is] an institution immanent in every legal order”, and“the principle of good faith refers to a rule of social conduct obvious in the sight of everybody.”②E. Zoller, Good Faith in Public International Law, quoted by Michel Virally, LIU Xinsheng trans., Notes and Comments, Review Essay: Good Faith in Public International Law, Peking University Law Journal, No. 4, 1984, p. 54. (in Chinese)These highlight the status of the principle in contemporary legal system. The application of the principle of good faith in the law of treaties is especially prominent in international law. Certainly, “The principle of good faith is thus equally applicable to relations between individuals and to relations between nations … It should, therefore, be the fundamental principle of every legal system”.③Bin CHENG, General Principle of Law as Applied by International Courts and Tribunals, London: Stevens and Son, 1953, p. 105.

The status of the good faith principle has also been manifested in many legal precedents. For example, in the United States – Anti-dumping Measures on Certain Hot-Rolled Steel Products from Japan, the World Trade Organization (WTO) Appellate Body opined, “the principle of good faith … is … a general principle of law and a principle of general international law, that informs the provisions of the Anti-Dumping Agreement, as well as the other covered agreements.”④United States – Anti-dumping Measures on Certain Hot-Rolled Steel Products from Japan, WT/DS184/AB/R, Report of the Appellate Body, 24 July 2001, para. 101.The ICJ pointed out, in paragraph 49 of the Judgment of the Nuclear Tests (New Zealand v. France), that “One of the basic principles governing the creation and performance of legal obligations, whatever their source, is the principle of good faith … Just as the very rule of pacta sunt servanda in the law of treaties is based on good faith, so also is the binding character of an international obligation assumed by unilateral declaration.”⑤Nuclear Tests (New Zealand v. France), Judgment, ICJ Reports 1974, para. 49.This statement articulates that the principle of good faith constitutes a part of the foundation of the treaty structure. The good faith principle, despite of its source from natural law, is an ethical principle, which, however, does not imply it is only a “subjective one”. This principle, indeed, rests upon individual psychology, but refers also to rules of behavior. In particular, good faith requiresthat the expressed will be consistent with the real will. In other words, good faith excludes any separation between reality and appearances.①E. Zoller, Good Faith in Public International Law, quoted by Michel Virally, LIU Xinsheng trans., Notes and Comments, Review Essay: Good Faith in Public International Law, Peking University Law Journal, No. 4, 1984, p. 55. (in Chinese)

The principle of good faith plays a fundamental role in international law. French Professor M. Virally contends that ignoring that the good faith principle forms part of the foundation of the whole international legal structure may run the risk of reducing international law to a set of hollow legal formulas.②E. Zoller, Good Faith in Public International Law, quoted by Michel Virally, LIU Xinsheng trans., Notes and Comments, Review Essay: Good Faith in Public International Law, Peking University Law Journal, No. 4, 1984, p. 57. (in Chinese)This contention shows that good faith is an element absolutely necessary in the formation and implementation of international social laws, which facilitates the proper functioning of the international legal system as a whole. In this sense, good faith is called “the oil of machine”. In the Statute of the ICJ, the principle of good faith is listed as one of “the general principles of law recognized by civilized nations”,③Statute of the International Court of Justice, Article 38(1).which aims to tell that this principle, as a source of international law, is a common value sought by all civilized nations. As perceived from its constituent elements such as “honesty”, “fairness” and “reasonableness”, the principle of good faith is able to help change the “lawless” state in international law, eliminate conf l icts of rules, exclude the negative ef f ects of malicious behaviors, and further to reduce deviation from fair results and balance of interests. This principle, in fact, keeps the spirit and value of the legal order, ensuring the attainment of substantial justice in the society. “The law of treaties is closely bound with the principle of good faith, if indeed not based on it; for this principle governs treaties from the time of their formation to the time of their extinction”.④Bin CHENG, HAN Xiuli and CAI Congyan trans., General Principles of Law as Applied by International Courts and Tribunals, Beijing: Law Press China, 2012, p. 106. (in Chinese)This shows that the lack of express mentioning of the good faith principle in some treaties, does not af f ect or alter the factual basis supporting its governing of the creation and performance of the legal obligations under international law; instead, it remains a general legal principle and a basic principle of international law that is universally recognized.

Since good faith rests upon individual psychology, the principle of good faith cannot work on its own. In this connection, its legal ef f ects and substantive significances can be realized only when it is applied in combination with otherspecific rules and doctrines. The same is true for the rules of international law, including world trade rules. These abstract rules, in most cases, are applied after translating into concrete rules. The principle of good faith governs the conclusion, implementation and interpretation of a treaty. During the conclusion of a treaty, this principle requires the States to sign a treaty honestly, fairly and reasonably on the one hand; on the other hand, it regulates any malicious conclusion of a treaty, illegalizes or invalidates such malicious acts, so as to prevent the object and purpose of a treaty from being impaired. During the implementation of a treaty, in line with the original meanings of the good faith principle, States should execute the treaty in an honest, just and reasonable manner, since to perform a treaty in good faith is an obligation under general international law. Examples are most abundant with respect to the application of this principle to treaty interpretation. The principle of good faith is the overall principle governing the interpretation of treaties, which requires that treaties be explained honestly, justly and reasonably.①ZHAO Jianwen, The Principle of Good Faith on the Law of Treaties, Contemporary Law Review, No. 4, 2013, pp. 123～124. (in Chinese)Deviation from such requirements, if any, would easily give rise to problems like abuse of rights, further leading to unfair results. The SCS Arbitration initiated by the Philippines is a perfect example in this regard.

C. Def i ciencies and Limitations of the Good Faith Principle

Every coin has two sides. The principle of good faith is no exception. The principle is extremely abstract, which is one of its limitations. Inter alia, when interpreting treaties, the abstract character of the principle makes it difficult to rightly understand and apply the principle. “Interpretation in good faith is a general principle. It is challenging to fi x its concrete contents. In this connection, standards that are indisputable, objective and universally recognized are, probably, nowhere to be found. ”②Jeff Waincymer, WTO Litigation: Procedural Aspects of Formal Disputes Settlement, London: Cmmerron May Ltd., 2002, p. 499, quoted from ZHANG Dongping, On WTO Judicial Interpretation, Xiamen: Xiamen University Press, 2005, p. 189. (in Chinese)This fact indicates that there are no fi xed methods or rules in the application of the good faith principle to treaty interpretation. The limitation of the principle is best and most apparently seen in treaty interpretation. For example, in the United States – Sections 301～310 of Trade Act 1974, the Panel asserted that,It is notoriously difficult, or at least delicate, to construe the requirement of the Vienna Convention that a treaty shall be interpreted in good faith in third party dispute resolution, not least because of the possible imputation of bad faith to one of the parties. We prefer, thus, to consider which interpretation suggests“better faith” and to deal only brief l y with this element of interpretation.①WT/DS152/R, 22 December 1999, para. 7.64.

This assertion suggests that the good faith principle is still developing when it comes to treaty interpretation; so are its status and role, which should be determined on a case-by-case basis after considering the specific social and historical conditions. The good faith principle is usually deemed as an ethical one. If simply perceived from ethical sphere, its real persuasiveness and authority may be reduced, and some illegal and malicious thoughts and behaviors would easily get the upper hand, leading to unfair and unreasonable results, in contravention with the spirit of the principle. Particularly, when “the borderline between interpretation and application becomes blurred”,②Richard K. Garadiner, Treaty Interpretation, Oxford: Oxford University Press, 2008, p. 168.the exact def i nition of the good faith principle is dependent on the translation and expression of other principles, which, to some extent, limits the role of the good faith principle. Practices tell that the principle of good faith is a directional principle, which guides us to follow such value and ideas as fairness, equality, reasonableness and honesty. On the other hand, it also means that this principle is neither invariable, def i nite, nor without any limits; rather, it has its borderline and limitations. In international law, “good faith may only become a basic principle, but not replace the most basic principle – sovereign equality.”③LUO Guoqiang, On the Noumena of International Law, Beijing: Law Press China, 2008, p. 169. (in Chinese)In the development of the system of international law, the principle of good faith is merely a part of the system, which cannot be over-exaggerated or completely substitute other parts of the system. This principle may be applied and come into play usually when the pertinent legal provisions are equivocal or absent. Under most circumstances, this principle is only stressed “subjectively”. In other words, it has not, really, been put into practice, and its essential values have not been obtained, resulting in an embarrassing separation of theory from practice.

III. Main Embodiment and Specif i c Application of the Good Faith Principle

A. The Good Faith Principle Embodied in International Legal Instruments

The good faith principle is an ancient general principle. From its incorporation into the Roman law, the national law of every Western State, and then into the system of common law, it ultimately becomes a “general principle of law recognized by civilized nations”. During the development of Chinese or foreign legal systems, the good faith principle, resembling the “oil of machine”, keeps the stable operation of the entire legal system. Particularly, after the end of World War II, the principle became more prominent in respect of its status and role in international law, and was later incorporated into a large number of international legal instruments. The following pages will cite only some of the representative and authoritative instruments, for the sake of limited space.

Article 2(2) of the 1945 Charter of the United Nations specif i es, “All Members, in order to ensure to all of them the rights and benef i ts resulting from membership, shall fulf i ll in good faith the obligations assumed by them in accordance with the present Charter.” In accordance with the requirements of the good faith principle, to perform international obligations in good faith, as a necessary condition for cooperation between States, ensures the attainment of the legitimate rights and interests of each State. Then Articles 18, 26 and 31(1) of the VCLT express that the good faith principle governs the conclusion, implementation and interpretation of treaties, which means that the States Parties should abide by the requirements of the principle. By virtue of these articles, the principle of good faith was further established in the VCLT. The 1970 Declaration on Principles of International Law Concerning Friendly Relations and Co-operation Among States in Accordance with the Charter of the United Nations articulates that every State shall fulf i ll in good faith the obligations assumed by it in accordance with the Charter of the United Nations.①Declaration on Principles of International Law Concerning Friendly Relations and Cooperation Among States in Accordance with the Charter of the United Nations, General Assembly (25th Session) Resolution No. 2625 (XXV), U.N.Doc.A/8082, p. 121, at http:// www.unoosa.org/pdf/gares/ARES_25_2625E.pdf, 22 May 2017.Likewise, Article 157(4) of the UNCLOS, in connection with theInternational Sea-Bed Authority, provides that “All members of the Authority shall fulf i ll in good faith the obligations assumed by them in accordance with this part in order to ensure to all of them the rights and benef i ts resulting from membership.”The principle of good faith is also widely adopted in international trade treaties. Legal instruments in this regard are also great in number. For example, Article 7(1) of the 1980 United Nations Convention on Contracts for the International Sale of Goods states that in the interpretation of this convention, regard is to be had to its international character and to the need to promote uniformity in its application and the observance of good faith in international trade. This convention also clearly shows that the principle of good faith is essential in the interpretation of treaties, although it does not, like the other conventions listed above, highlight the status of the principle.

The UNCLOS, always considered as the “constitution of the oceans”, provides in its Article 300: “States Parties shall fulf i ll in good faith the obligations assumed under this Convention and shall exercise the rights, jurisdiction and freedoms recognized in this Convention in a manner which would not constitute an abuse of right.” This provision prohibits the States Parties from abusing the rights recognized by the UNCLOS. On the one hand, it can be seen that the principle of prohibition of abuse of rights is actually derived from the principle of good faith. On the other hand, it shows that a State’s exercise of rights recognized by a treaty is subject to the principle of good faith. The international legal instruments above tell that, in the law of treaties, implementation and interpretation of treaties in good faith are closely linked with and complementary to each other. In other words, “implementation of treaties in good faith is, necessarily, preconditioned on interpretation in good faith, since interpretation of treaties in bad faith, i.e., distortion of treaties, would certainly result in performance of treaties not in good faith.”①LI Haopei, Introduction to the Law of Treaties, Beijing: Law Press China, 1987, p. 329. (in Chinese)In sum, the principle of good faith, which can be found in all sorts of international legal instruments, has been widely recognized. Its requirement on discharging international obligations in good faith becomes increasingly clear and distinct.

B. The Application of the Good Faith Principle in International (Quasi) Judicial Practices

In the current international law, many treaties contain provisions on “dispute settlement”. When the parties concerned cannot resolve their disputes, they may recourse to third-party dispute settlement mechanisms. In that case, the value and importance of the principle of good faith will be highlighted. This paper focuses on the application of the good faith principle in international (quasi) judicial practices, so as to pave the way for the following analysis for the SCS Arbitration initiated by the Philippines. Due to the absence of unif i ed and def i nite standards for the good faith principle, the duty to interpret in good faith under Article 31 of the VCLT, as an obligation under customary international law, would certainly be considered in international (quasi) judicial practices. Additionally, the principle of good faith, in most cases, must apply and exert substantive legal effects by virtue of other concrete principles and rules, such as the principle of ef f ectiveness. The principle of ef f ectiveness is also derived from the principle of good faith.①Richard K. Garadiner, Treaty Interpretation, Oxford: Oxford University Press, 2008, p. 168.In the view of Mr. FENG Shoubo, the principle of ef f ectiveness means that “it is better to render a provision effective than ineffective.”②FENG Shoubo, On the Treaty Interpretation in “Good Faith”: An Empirical Research on“Good Faith” in Art. 31.1 of VCLT, Pacif i c Journal, Vol. 22, No. 5, 2015, p. 7. (in Chinese)In other words, this principle implies that the contracting parties intend to make a clause of a treaty effective, rather than meaningless. In the Anglo-Iranian Oil Co. (United Kingdom v. Iran), the ICJ admitted in principle that “a legal text should be interpreted in such a way that a reason and a meaning can be attributed to every word in the text.”③Hersch Lauterpacht ed., WANG Tieya and CHEN Tiqiang tans., Oppenheim’s International Law, Vol. 1, No. 2, Beijing: The Commercial Press, p. 365. (in Chinese)In the fi rst draft of Article 31 of VCLT, the International Law Commission, linking the principle of ef f ectiveness with “good faith” and “object and purpose”, subsumed the elements of the principle under Article 31(1).④Richard K. Garadiner, Treaty Interpretation, Oxford: Oxford University Press, 2008, p. 179.It indicates that the ef f ectiveness of a clause requires that the clause be interpreted in such a way that is consistent with the object and purpose of the treaty, which is immanent in the principle of good faith. In Territorial Dispute (Libyan Arab Jamahiriya/Chad), 1994, the ICJ interpreted the text of the treaties involved and conf i rmed the relevant outcomes, in accordancewith the principle of effectiveness.①Territorial Dispute (Libyan Arab Jamahiriya/Chad), Judgment, ICJ Reports 1994, paras. 27～28.Thereafter, this principle was gradually recognized and applied by all kinds of international dispute settlement bodies. For example, when ruling on the Japan – Taxes on Alcoholic Beverages, 1996, the WTO Appellant Body alleged that “A fundamental tenet of treaty interpretation fl owing from the general rule of interpretation set out in Article 31 is the principle of effectiveness (ut res magis valeat quam pereat).”②Japan – Taxes on Alcoholic Beverages, WT/DS8/AB/R, WT/DS10/AB/R, WT/DS11/AB/R, 1996, p. 12.As per the principle of effectiveness, a treaty interpreter should comprehensively read and construe the treaty in its entirety. The Appellant Body also believed that “a treaty interpreter must read all applicable provisions of a treaty in a way that gives meaning to all of them, harmoniously.”③Argentina – Safeguard Measures on Imports of Footwear, WT/DS121/AB/R, para. 81.

As described above, the principle of good faith works through the principle of ef f ectiveness. In addition to that, the good faith principle has also been applied to various cases, where it played a crucial role. For instance, when ruling on the Nuclear Tests (Australia v. France), 1974, the ICJ articulated that “One of the basic principles governing the creation and performance of legal obligations … is the principle of good faith.”④Nuclear Tests (Australia v. France), Judgment, ICJ Reports 1974, p. 268.It follows that the principle of good faith is one of the elements that the ICJ has to consider when making a ruling. The principle of good faith is a general legal principle and a basic principle of international law, which is recognized universally. It governs a State’s exercise of rights, and is often deemed as the dominant standard guiding the resolution of disputes. For example, in United States – Import Prohibition of Certain Shrimp and Shrimp Products, 1998, the WTO Appellate Body, when interpreting and applying Article 20 of the General Agreement on Tariffs and Trade, 1994, argued that “our task here is to interpret the language of the chapeau, seeking additional interpretative guidance, as appropriate, from the general principles of international law.”⑤United States – Import Prohibition of Certain Shrimp and Shrimp Products, WT/DS58/AB/ R, 12 October 1998, para. 158.This statement shows the general character of good faith. As stated above, the principle of good faith governs and promotes the performance of a treaty; to implement and construe a treaty in good faith has become an obligation of customary international law. In Gabčíkovo – Nagymaros Project (Hungary v. Slovakia), 1997, the ICJ statedthat performing a treaty in good faith concerned “the purpose of the treaty, and the intentions of the parties in concluding it, which should prevail over its literal application.”①Gabčíkovo – Nagymaros Project (Hungary v. Slovakia), Judgment, ICJ Reports 1997, para. 142.“Honesty”, “fairness” and “reasonableness” are the elements immanent in the principle of good faith, which are, now and again, ref l ected in the practices concerning the settlement of disputes. For example, in Chile – Taxes on Alcoholic Beverages, 2000, the WTO Appellate Body held that “Members of the WTO should not be assumed, in any way, to have continued previous protection or discrimination through the adoption of a new measure. This would come close to a presumption of bad faith.”②Chile – Taxes on Alcoholic Beverages, WT/DS87/AB/R, WT/DS110/AB/R, 13 December 1999, para. 74.In a similar case, i.e., European Communities – Trade Description of Sardines, 2002, the Appellate Body stressed that “We must assume that Members of the WTO will abide by their treaty obligations in good faith, as required by the principle of pacta sunt servanda articulated in Article 26 of the Vienna Convention … every Member of the WTO must assume the good faith of every other Member.”③European Communities – Trade Description of Sardines, WT/DS231/AB/R, 26 September 2002, para. 278.The two cases fully demonstrate that “honesty” is a specif i c requirement of the good faith principle. Since the Appellant Body, during its consideration of the United States – Standards for Reformulated and Conventional Gasoline, pointed out that the good faith principle articulated in VCTL Article 31 was the customary rule for the interpretation of international treaties, in the practices with respect to WTO dispute resolution, “appellant bodies, panels, arbitrators and the parties concerned all have accepted the principle of interpreting treaties in good faith, and applied this principle in resolving actual disputes. Almost every report on dispute settlement contains, in the part regarding agreement interpretation, the term “good faith”, as well as the requirement on interpretation in good faith.”④HAN Liyu, Application of the Good Faith Principle to WTO Dispute Settlement, Jurists Review, No. 6, 2005, p. 151. (in Chinese)

The status of the good faith principle, as a rule of customary international law, has been further consolidated in the Rhine Chlorides Arbitration concerning the Auditing of Accounts (The Netherlands/France), 2004. The tribunal of the Netherlands/France case considered that “this application of good faith was ref l ected in article 32 of the Vienna rules, with its reference to the preparatory workand surrounding circumstances.”①Geogre Pinton Case, France v. Mexico, 19 October 1928; Richard K. Garadiner, Treaty Interpretation, Oxford: Oxford University Press, 2008, pp. 174～175.It suggests that a State shall also be bounded by the principle of good faith, even if it is not a contracting party to a treaty. Further, practices indicate that the application of the good faith principle is not affected, even if a treaty has not come into effect. For example, in the Megalidis case of 1926, the Greco-turkish mixed arbitral tribunal found that “prior to the entry into force of the treaty, the Contracting Parties have an obligation, after signature, to refrain from any action that might impair the treaty by reducing the importance of its clauses. This principle is a mere manifestation of good faith. And the principle of good faith is the basis of all laws and treaties”.②Oliver Dörr and Kirsten Schmalenbach eds., Vienna Convention on the Law of Treaties: A Commentary, New York: Springer Science & Business Media, 2011, p. 224.The practices relating to treaty interpretation of the Permanent Court of International Justice (PCIJ) reveal that, when considering the real intentions of the parties, the treaty should be interpreted in accordance with its object and purpose, so that disputes may move towards the direction of “equitable” resolution, as originally intended by the good faith principle. For example, when interpreting treaties, the PCIJ held: “treaty obligations should be carried out according to the common and real intention of the parties at the time the treaty was concluded, that is to say, the spirit of the treaty and not its mere literal meaning. This is one of the most important aspects of the principle of good faith and is in accordance with the notion that a treaty is an accord of will between contracting parties.”③Bin CHENG, General Principle of Law as Applied by International Courts and Tribunals, London: Stevens and Son, 1953, pp. 114～116.

Additionally, the panel and the Appellant Body’s objective examination of the United States – Anti-Dumping Measures on Certain Hot-Rolled Steel Products from Japan is a concrete manifestation of the requirement of “fairness” as embodied in the good faith principle. The principle’s requirement on “reasonableness” is reflected in the Rights of Nationals of the United States of America in Morocco (France v. United States of America), the ICJ held that the customs authorities should exercise their powers of making the valuation reasonably and in good faith.

To sum up, the principle of good faith is widely applied and recognized in international (quasi) judicial practices. In the practices relating to the settlement of disputes between States, the principle not only governs the parties to a dispute, but also any interested third parties, and the dispute settlement bodies. The principlehas obviously become the fundamental basis for the creation and functioning of the international legal system. Particularly, in the settlement of international disputes, ignoring the principle would render any resolution meaningless, and even gradually impair, destroy and collapse the international legal system jointly created by all the States.

C. The Relationship Between the Good Faith Principle and Abuse of Rights

Given that the principle of good faith is abundantly applied in the field of the law of treaties, many doctrines and rules are extended from it. “Pacta sunt servanda”, “balance of interests”, “prohibition of abuse of rights”, “estoppel”,“protection of legitimate expectations”, and other legal principles are all derived from the principle of good faith, which exert their unique legal ef f ects in dif f erent situations.①LIU Jingdong, The Principle of Good Faith in WTO Legal System, Beijing: Social Sciences Academic Press (China), 2009, p. 7. (in Chinese)Signs of abuse of rights are most visible and prominent in the SCS Arbitration filed by the Philippines, the paper, therefore, will focus on the links between the principle of good faith and the theory of abuse of rights.

In the words of FENG Shoubo, “the theory of abuse of rights means that States are prohibited from abusing rights, and are required to exercise their rights in good faith, as long as their claims to rights involve obligations under treaties. Hence, if a contracting party abuses its rights under a treaty, it would undermine the rights of other contracting parties under the treaty, which is also a violation of its own obligations under the treaty.”②FENG Shoubo, On the Treaty Interpretation in “Good Faith”: An Empirical Research on“Good Faith” in Art. 31.1 of VCLT, Pacif i c Journal, Vol. 22, No. 5, 2015, p. 6. (in Chinese)That is to say, the rights exercised by a contracting State should match with its obligations. If it performs its rights in a malicious way that impairs the rights of other contracting States, it would breach its obligation to perform the treaty in good faith, as well as defeat the object and purpose of the treaty. On the other hand, an abuse of rights occurs, generally, on the precondition of the existence of an agreement. The theory of abuse of rights mirrors the requirement of the good faith principle on “honesty and credibility”. In other words, this theory overlaps, to some extent, with the good faith principle. The theory of abuse of rights, recognized in principle by the ICJ, is merely anapplication of this principle to the exercise of rights.①Bin CHENG, HAN Xiuli and CAI Congyan trans., General Principles of Law as Applied by International Courts and Tribunals, Beijing: Law Press China, 2012, p. 125. (in Chinese)

The link between the principle of good faith and the theory of abuse of rights has, in fact, been recorded in the legal systems of some Western States for a long time. For example, the Swiss Civil Code prescribes that “everyone must, in the exercise of his rights and in the performance of his duties, act with truth and faith. The open misuse of a right finds no protection in the law.”②LUO Gang, The Principle of Good Faith and Abuse of Procedural Rights in International Law from the Perspective of Legal Realism – Taking the SCS Arbitration as an Example, in KONG Qingjiang ed., International Law Review, Vol. 7, Beijing: Tsinghua University Press, 2016, p. 19. (in Chinese)Spanish Civil Code, Article 7, provides that “rights must be exercised in accordance with the requirements of good faith. The law does not support abuse of rights or the antisocial exercise of rights.”③Spanish Civil Code, Article 7(1), and the fi rst sentence of Article 7(2).This provision directly confirms the legal link between the principle of good faith and abuse of rights. And a large number of scholars unanimously believe such a link is embodied in the system of common law.④Michael Byers, Abuse of Right: An Old Principle, A New Age, McGill Law Journal, Vol. 47, 2002, pp. 389～431.Likewise, this link is also attached with much importance in international law. As stated previously, Article 300 of the UNCLOS has pointed out the close link between the principle of good faith and abuse of rights. Since the principle of honesty and credibility forms a major part of the good faith principle, a behavior which has violated the former principle has, necessarily, breached the latter principle. In the view of Prof. Bin CHENG, the theory of prohibition of abuse of rights primarily has four characteristics: the malicious exercise of a right, the fi ctitious exercise of a right, interdependence of rights and obligations, and abuse of discretion, which are, as a matter of fact, the manifestation of abuse of rights.⑤Bin CHENG, HAN Xiuli and CAI Congyan trans., General Principles of Law as Applied by International Courts and Tribunals, Beijing: Law Press China, 2012, pp. 125～140. (in Chinese)To judge whether a behavior falls under the scope of abuse of rights in contravention with the principle of good faith, we must fi rst determine what behavior constitutes an abuse of rights. Hence, the following paragraphs will, from the perspective of the four characteristics, concretely analyze the links between the principle of good faith and the theory of prohibition of abuse of rights.

Firstly, the practices of many civil law countries demonstrate that, themalicious exercise of a right is an important aspect of the theory of prohibition of abuse of rights.①H. C. Gutteridge, Abuse of Rights, Cambridge Law Journal , Vol. 5, 1933, p. 22.In the Fur Seal Arbitration, 1892, the president of the arbitral tribunal unequivocally acknowledged the application of the prohibition of malicious exercise of a right in international law. Additionally, the United States, a party to the arbitration, also alleged that freedom was only limited to imposing no obstruction or harm, without jeopardizing any coastal State’s exercise of its legitimate interests.②John Bassett Moore, History and Digest of the International Arbitrations to Which the United States Has Been a Party, Vol. 1, Washington: Government Printing Office, 1898, p. 892.This suggests that freedom has boundaries. Any acts going beyond the boundaries would be regulated by laws, just as the legal proverb goes:“Malitiis non est indulgendum”.③Further Response to the United States of America Counter-claim submitted by the Islamic Republic of Iran, Oil Platforms (Islamic Republic of Iran v. United States of America), 24 September 2001, p. 105, note. 45, at http://www.icj-cij.org/docket/files/90/8636.pdf, 23 May 2017.Therefore, any exercise of a right for the sole purpose of causing damages to the other party is prohibited by law.④Bin CHENG, HAN Xiuli and CAI Congyan trans., General Principles of Law as Applied by International Courts and Tribunals, Beijing: Law Press China, 2012, p. 126. (in Chinese)In the Case concerning Certain German Interests in Polish Upper Silesia, 1926, Germany admitted that no rights could be exercised without any restrictions, and an exercise of rights for the purpose of causing damages to the others, but without other important motives, should constitute an abuse of rights.⑤Case concerning Certain German Interests in Polish Upper Silesia (The Merits), Speech of German Agent (Series C-No. 11, Vol. I, pp. 136 et seq.) and German Memorial (pp. 375 et seq.), PCIJ, 1926.This statement means that the exercise of a right in bad faith constitutes an abuse of rights, which violates the principle of good faith. Apart from that, the malicious exercise of rights, which is generally excluded and prohibited by international judicial bodies and States in the settlement of disputes, should not be recognized and protected by law.

The second is about the fi ctitious exercise of a right. Any fi ctitious exercise of rights is for the purpose of evading either a rule of law or a treaty obligation. In order to evade the applicable laws, a party may fabricate or package the alleged“facts”, and cover up its unlawful purposes through legal means, so as to evade legal and contractual obligations. Such behaviors obviously go against legal provisions, therefore should be deemed as illegal and inef f ective. Fictitious exercise of a right can be found in the Walter F. Smith Case, 1929. A State’s seizure of a property for personal rather than public interests was considered contrary to theprinciple of good faith and illegal.①Walter Fletcher Smith Claim (Cuba, USA), 1929, Reports of International Arbitral Awards, Vol. II, p. 917, at http://legal.un.org/riaa/cases/vol_II/913-918.pdf, 25 May 2017In international law, the element “honesty and credibility” inherent in the principle of good faith requires every State sincerely exercise its rights, in compliance with the object and purpose of a treaty. Any fictitious exercise of rights for the purpose of evading either a rule of law or a contractual obligation will not be tolerated by law. For example, in the Free Zones of Upper Savoy and the District of Gex, 1932, since France was obliged to maintain the zones free from customs barriers, the PCIJ stated in the award that“A reservation must be made as regards the case of abuses of a right, since it is certain that France must not evade the obligation to maintain the zones by erecting a customs barrier under guise of a control cordon.” In other words, the exercise of rights for the purpose of evading legal obligations in bad faith should not be protected by law.②Case of the Free Zones of Upper Savoy and the District of Gex, Judgment, Series A/B, No. 46, PCIJ, 1932, p. 16. See also the Court’s Order made on 6 December 1930, in the same case, Series A, No. 24, PCIJ, p. 12; Oscar Chinn Case, Judgment, Series A/B, No. 63, PCIJ, 1934, p. 86.

The third concerns the interdependence of rights and obligations. In the words of Prof. Bin CHENG, “When a State assumes a treaty obligation, those of its rights which are directly in conf l ict with this obligation are, to that extent, restricted or renounced.”③Bin CHENG, HAN Xiuli and CAI Congyan trans., General Principles of Law as Applied by International Courts and Tribunals, Beijing: Law Press China, 2012, p. 128. (in Chinese)To put it simply, when a State assumes an obligation, its rights would be restricted to some dif f erent extent. To perform international obligations in good faith can be said to have imposed a general restriction on the rights of States. In North Atlantic Coast Fisheries, 1910, the arbitral tribunal argued that:

Because the line in question is drawn according to the principle of international law that treaty obligations are to be executed in perfect good faith, therefore excluding the right to legislate at will concerning the subject-matter of the Treaty, and limiting the exercise of sovereignty of the States bound by a treaty with respect to that subject-matter to such acts as are consistent with the treaty.④The North Atlantic Coast Fisheries Case (Great Britain, United States), 7 September 1910, Reports of International Arbitral Awards, p. 188, at http://legal.un.org/riaa/cases/vol_ XI/167-226.pdf, 24 May 2017.

It can be perceived that the principle of good faith enhances the interdependence of rights and obligations of States. Inter alia, when a party exercises its rights, it must comply with the requirements of “honesty and credibility” and“reasonableness” as embodied in the principle of good faith. Only when these requirements are satisfied, can that party be considered having fulfilled the obligation in this regard. Where such boundaries are overridden, and a party intentionally exercises its rights by such means as undermine the interests of other parties, that party should be deemed to have violated the obligation to perform a treaty in good faith, which constitutes a breach of the treaty. In this connection, the principle of good faith helps to push the exercise of rights in line with the spirit of the obligations, so as to reasonably balance the interests of all contracting States. The German Interests case, 1926, is another typical example mirroring the interdependence of rights and obligations. In North American Dredging Co. of Texas case of the same year, when discussing the “world-wide abuse either of the right of national protection or of the right of national jurisdiction”, the Mexico/ U.S.A. General Claims Commission clearly stated:

The present stage of international law imposes upon every international tribunal the solemn duty of seeking for a proper and adequate balance between the sovereign right of national jurisdiction, on the one hand, and the sovereign right of national protection of citizens on the other. No international tribunal should or may evade the task of fi nding such limitations of both rights as will render them compatible within the general rules and principles of international law.①North American Dredging Company of Texas (U.S.A. v. United Mexican States), 31 March 1926, Reports of International Arbitral Awards, p. 27, at http://legal.un.org/riaa/cases/vol_ IV/26-35.pdf, 24 May 2017.

The statement above reveals that the theory of the interdependence of rights and obligations has developed and elevated into a general obligation on law, rather than being only limited to treaties. Therefore, the bona fide exercise of a right implies an exercise which is consistent with all treaty obligations or ordinary legal obligations, and also an exercise that is genuinely in pursuit of those interests which the right is destined to protect, whether these interests be secured by treatyor by general international law.①Bin CHENG, HAN Xiuli and CAI Congyan trans., General Principles of Law as Applied by International Courts and Tribunals, Beijing: Law Press China, 2012, pp. 135～136. (in Chinese)

The fourth is about the abuse of discretion. An individual or a State may enjoy certain discretion when exercising his or its rights. Therefore, both the individual and the State have the possibility to abuse discretion. When a subject enjoys discretion, it shall exercise its discretion in good faith in line with the standards of “integrity” and “reasonableness”. Overriding these standards would possibly constitute an abuse of rights. However, it is really challenging to judge whether an act constitutes an abuse of discretion or not, due to the ideological character of discretion. In the Fisheries Case (United Kingdom v. Norway), 1951, the ICJ assessed whether Norway had committed “manifest abuse of discretion”during its delineation of baselines, against the standards of “reasonableness” and“moderation”.②Fisheries Case (United Kingdom v. Norway), ICJ Reports 1951, pp. 141～142.As perceived from international judicial practices, even if the determination of an abuse of discretion is “subjective” and demanding, it does not mean that it is almost impossible to judge such an abuse. In fact, it is possible to judge whether an abuse of a right governed or excluded by the law exists or not, if the subjective aspects, together with the objective behaviors of the right exerciser, are scrutinized on a case-by-case scenario, by reference to previous international practices and the existence of manifestly malicious or unreasonable conduct vel non. Nevertheless, it remains, undeniably, a troubling factor and difficult task in international judicial practices to determine the existence of an abuse of discretion. And the provision that “abuse of a right cannot be presumed”,③Case concerning Certain German Interests in Polish Upper Silesia (The Merits), Judgment, Series A, No. 7, PCIJ, 1926, p. 30; Case of the Free Zones of Upper Savoy and the District of Gex (Second Phase), Order, Series A, No. 24, PCIJ, 1930, p. 12; Case of the Free Zones of Upper Savoy and the District of Gex, Judgment, Series A/B, No. 46, PCIJ, 1932, p. 167.adds to the difficulty in regulating or controlling abuse of rights. This fact is fully shown in the first advisory opinion rendered by the ICJ. Whether in virtue of Article 4(1) of the Charter of the United Nations, or being bounded by the basic purpose and principles of the UN Charter, all judges agreed that the discretion inherent in the vote should be exercised in good faith.④Admission of a State to the United Nations (Charter, Art. 4), Advisory Opinion, ICJ Reports 1948, pp. 63, 71, 79 et seq., 91, 92, 93, 103, 115.Practices tell that, it is absolutely necessary to exercise the discretion immanent in a right in good faith, no matter in what legal system. The principle of good faith is, indeed, closely linked with thetheory of prohibition of abuse of rights. This principle harmonizes and balances conf l icting interests, ensuring that rights are exercised in an “honest”, “reasonable”and “just” manner, and preventing the emergence of abuse of rights, so as to drive and guarantee the normal and stable operation of the whole legal system.

IV. Specif i c Manifestations of Violation of the Good Faith Principle in the SCS Arbitration Filed by the Philippines

The UNCLOS is regarded as the “constitution of the oceans”. Despite of its decisive position, the convention also has limitations. With regards to the settlement of international marine disputes, some UNCLOS provisions are ambiguous but not specif i c. Apart from that, the UNCLOS lacks a regime regulating the abuse of litigation. Such def i ciencies may leave a loophole, where the subjects with unlawful intents may abuse their rights for illegal purposes. As a general legal principle, the principle of good faith is able to fi x up the def i ciencies of the UNCLOS, and also orient the addressing of disputes in the direction compliant with the spirit and purpose of the UNCLOS, so as to ensure that the disputes may be resolved in a reasonable and fair fashion. It shows that the principle of good faith is fundamental in the interpretation and application of the UNCLOS. A right exerciser must be regulated and bounded by the principle.

From the Philippines’ bringing of the SCS Arbitration against China, to the Tribunal’s acceptance and deliberation of the case, then to release of the final award, the case is riddled with abuse of rights in violation of the good faith principle, no matter perceived from the Philippines’ or the Tribunal’ side. The Philippines maliciously abused its rights under the UNCLOS, with a view to undermining China’s sovereignty within the SCS. In order to achieve its unlawful objects, the Philippines played word tricks to partially construe the UNCLOS provisions. Ignoring the object and purpose of UNCLOS, it fabricated many “disputes”, which disturbed the order and trampled on the dignity of international law. In other words, the Philippines utilized the UNCLOS as a “tool of international law” to pursue its unlawful purposes. The Tribunal, acting as an umpire in the dispute settlement mechanism, is supposed to exercise its “discretion”prudently, seeking to peacefully settle disputes as required by the spirit, object and purpose of the UNCLOS. Nevertheless, the Tribunal intentionally evaded its responsibilities and obligations, and further abused its discretion granted by thedispute settlement mechanism under the UNCLOS, to “tacitly” cooperate with the Philippines and assist the latter in its malicious conducts. By doing so, the Tribunal disrespected the international law, placing dispute settlement on the edge of malignancy. The “cooperation” between the Philippines and the Tribunal, the Philippines’ “disguising” of its submissions through unlawful means, and their“technical” interpretation of legal provisions, obviously constitute abuse of rights, contrary to the principle of good faith. As a result, the fi nal award released by the Tribunal substantially breached the UNCLOS, which is neither reasonable nor fair, and shall be considered null and void. This section will, based on the procedural and substantive aspects, examine the abuse of rights by the Philippines and the Tribunal, with a view to demonstrating China’s legitimate position.

A. Procedural Aspect

Procedural justice, rooted in Western legal culture and system, is widely applied in the judicial practices of Western States. Closely linked with substantive justice, procedural justice is regarded as the “visible justice.” In the mechanism of international dispute settlement, procedural legality and legitimacy are decisive factors of substantive justice. Problems and def i ciencies of a legal process, if any, would necessarily af f ect the justice of a case. This shows that substantive justice directs and governs procedural justice, but the attainment of substantive justice needs the guarantee provided by procedural justice. Closely linked, the two form a unity of opposites. Justice is the direct source of the good faith principle, which, as a general principle of international law, governs the operation of international judicial organs, both in procedural and substantive aspects. The principle of good faith is a part of the institutional foundations for international law with respect to procedures. Some call the extension of this principle in the procedural aspect as“procedural good faith”.①LUO Gang, The Principle of Good Faith and Abuse of Procedural Rights in International Law from the Perspective of Legal Realism – Taking the SCS Arbitration as an Example, in KONG Qingjiang ed., International Law Review, Vol. 7, Beijing: Tsinghua University Press, 2016, p. 19. (in Chinese)Procedural good faith appeared as early as in the “actio publicaca” from the Roman law era, and had already been applied in this era. An umpire, in accordance with its authority and the relevant requirements, examined ethical aspects of a behavior on procedure, to determine whether good faith existedor not, with a view to helping deliver a just ruling.①Heinrich Honsell, Römisches Recht, 7th edition, Berlin/Heidelberg: Springer, 2010, pp. 84～86.Procedural good faith was later applied and recognized by international dispute settlement bodies. For instance, procedural good faith was established by WTO, and expressly written into the Understanding on Rules and Procedures Governing the Settlement of Disputes.②Marion Panizzon, Fairness, Promptness and Effectiveness: How the Openness of Good Faith Limits the Flexibility of the DSU, Nordic Journal of International Law, Vol. 77, No. 3, 2008, pp. 275～300.Among others, to “exercise its judgment as to whether action under these procedures would be fruitful”,③WTO Understanding on Rules and Procedures Governing the Settlement of Disputes, Article 3(7).to “engage in these procedures in good faith in an ef f ort to resolve the dispute”,④WTO Understanding on Rules and Procedures Governing the Settlement of Disputes, Article 3(10).and to “enter into consultations in good faith”,⑤WTO Understanding on Rules and Procedures Governing the Settlement of Disputes, Article 4(3).are concrete manifestations of procedural good faith. Accordingly, procedural good faith means to sincerely and friendly settle disputes, in line with the object and purpose of a treaty, to orient the settlement of disputes in a rightful and just direction, by making use of the fl exibility of the dispute settlement mechanism. In the SCS Arbitration initiated by the Philippines, the Philippines’ and the Tribunal’s abuse of rights is based on their violation of procedural good faith, leading to outcomes short of “legitimacy” and “justice”.

In the SCS Arbitration initiated by the Philippines, the most prominent problem, procedurally, is whether the Tribunal has jurisdiction over the case, which concerns the foundation of legitimacy for the Philippines’ initiation of the compulsory arbitration. Invoking Annex VII arbitration, one of the means to settle disputes under Section 2, Part XV of the UNCLOS, the Philippines unilaterally brought a compulsory arbitral procedure against China. As a general rule, some threshold requirements, at least, should be met, in order to initiate Annex VII compulsory arbitration: prerequisites such as the fulf i llment of obligations under the UNCLOS in a manner which would not constitute an abuse of rights (UNCLOS Article 300), pre-requirements like the performance of the obligation to exchange views (UNCLOS Article 283), and restrictive requirements such as not being subject to the “declaration” made in accordance with UNCLOS Article 298. Nonetheless, the Philippines maliciously evaded its obligations under the UNCLOS,and “disguised” its submissions by fragmentizing and converting its claims. On the other hand, the Tribunal, based on its bold hypotheses, raised some presumptions about the provisions of the UNCLOS. It created a number of standards incompliant with the spirit of the UNCLOS, surreptitiously swapped concepts, and reduced its obligation to expound and verify the Philippines’ claims or intentionally failed to discharge this obligation. Worse still, it abused its discretion to open a green channel for the Philippines, so that the latter may, prima facie, satisfy the threshold requirements for the start of a compulsory arbitration. By doing so, the Philippines and the Tribunal attempted to jointly “squeeze” China into the arbitral procedure. All these behaviors are originated from abuse of rights in violation of the good faith principle. The following pages will dwell on the principal illegal behaviors of the Philippines and the Tribunal.

1. Obvious and Malicious Abuse of Rights by the Philippines

The abuse of rights is a delicate question in law, since it needs to be assessed and determined in consideration of the ethical aspects of law. Ethical issues are very hazy, and therefore difficult to handle in practice. For this reason, international treaties and the national laws of some countries generally contain legal provisions on ethical issues, with an aim to prevent the right exerciser from affecting the realization of justice for ethical problems. The value of the good faith principle lies exactly in dealing with such legal-moral issue. Article 242 of German Civil Code, Article 1134(3) of the Napoleonic Code, Article 2(2) of the UN Charter, Article 31(1) of the VCLT, and Article 300 of the UNCLOS, all include provisions governing ethical issues, which are manifestations of the good faith principle. These articles indicate that the principle of good faith is a general legal principle applied to handle ethical issues. The bad faith and illegality of the Philippines’ behaviors is presumed based on its failure to conform with some legal-moral regulations, such as the fulfillment in good faith of international obligations and prohibition of abuse of rights provided in UNCLOS Article 300, and on its disregard or deliberate violation of the good faith principle in international law. Such behaviors fundamentally disturbed and undermined the stability of the order of international law established after World War II.

First, the Philippines failed to satisfy the “prerequisite”. It evaded the explicit provision regarding the fulfillment in good faith of international obligations and prohibition of abuse of rights under Article 300 of UNCLOS. Such behaviors, in reality, breached the principle of good faith, as well as the UNCLOS. The“prerequisite”, mainly relating to Article 300 of UNCLOS, requires that acontracting party, when exercising its rights, shall perform its international obligations in good faith and refrain from abusing its rights. Such requirements are actually the specific manifestations of the good faith principle. Article 26 of the VCLT is drafted for the same purpose. In the Gabčikovo-Nagymaros Project, 1997, the ICJ held that “Every treaty in force is binding upon the parties to it and must be performed by them in good faith”, and “The principle of good faith obliges the Parties to apply it in a reasonable way and in such a manner that its purpose can be realized.”①Gabčikovo-Nagymaros Project (Hungary/Slovakia), Judgment, ICJ Reports 1997, pp. 78～79.When the contracting parties try to settle their disputes by invoking the treaty concerned, they should reasonably perform their obligations under the treaty in good faith, taking into account the object of the treaty and the consensus reached upon the conclusion of the treaty. However, in order to jeopardize the territorial sovereignty of China, the Philippines went against the statement where it acknowledged the existence of territorial disputes with China, and even adopted some deceptive measures. It first fragmentized its claims to territorial sovereignty into several pieces, and then repacked them into 15 Submissions, which appeared, prima facie, irrelevant to disputes over territorial sovereignty. Afterwards, it pretended to admit the existence of territorial disputes with China, with an aim to validate the legal entitlements of the maritime features claimed by it. Lastly, it deliberately underlined that the Tribunal was not invited to adjudicate on any question of sovereignty over islands, rocks or any other maritime features.②Memorial of the Philippines (The Republic of the Philippines v. The People’s Republic of China), 30 March 2014, para. 1.16. [hereinafter “Memorial”]Through such disguising and deceptive means, the Philippines made its 15 Submissions seemingly compliant with the UNCLOS requirements on“disputes”, further breaking the legal barrier set by the “requisite”, and concealing its illegal intentions. As per the PCIJ, “a dispute is a disagreement on a point of law or fact, a conf l ict of legal views or of interests between two persons.”③The Mavrommatis Palestine Concessions, Judgment, Series A, No. 2, PCIJ, 1924, p. 11.As we all know, the Philippines has disputes with China over territorial sovereignty in the SCS, while China had, in line with Article 298 of UNCLOS, made a declaration in 2006, excluding such disputes from compulsory procedures. In order to bypass this declaration, the Philippines fabricated some “f i ctitious” disputes to conceal the real disputes over territorial disputes, and abused its rights under the UNCLOS, intending to prejudice the rights and interests of China. Apparently, the Philippinesunilaterally brought the compulsory arbitral procedure, not for the purpose of resolving disputes in good faith. Instead, presuming on the UNCLOS (“the constitution of oceans”), it tried to provide a prima facie legal basis for its unlawful intentions, and further to aggressively damage the maritime rights and interests of China.

Second, the Philippines, prima facie, conformed with the “pre-requirements”(UNCLOS Articles 280, 281 and 283), but violated, in reality, the principle of good faith and the doctrines of estoppel and integrity derived from the former principle, which also constitutes a breach of the UNCLOS. Article 280 of the UNCLOS underlines that any treaty between the parties to a dispute may preclude the recourse to a compulsory arbitration. Article 281 states that “the procedures provided for in this Part apply only where no settlement has been reached by recourse to such means”, which also articulates that the existence of an agreement may bar the initiation of a procedure. And Article 283 stresses the obligation to exchange views in advance. Estoppel is a doctrine derived from the principle of good faith, whereby a party is prevented from impairing the rights and interests of any other party by making assertions that are contradictory to its prior promises. This doctrine aims to keep the consistency of conducts in international relations.①LUO Gang, The Truth of International Law and Fundamental Flaws in the SCS Arbitration between China and the Philippines, at http://www.aisixiang.com/data/100801.html, 27 March 2017. (in Chinese)However, since this doctrine has solid foundation in both common and civil law systems, and has been widely applied and recognized in international judicial practices, it not only governs the moral aspects in international relations, but also the performance of rights and obligations.

Due to the complexity of SCS issues, ASEAN States and China jointly formulated and signed the Declaration on the Conduct of Parties in the South China Sea (DOC),②At http://asean.org/?static_post=declaration-on-the-conduct-of-parties-in-the-south-chinasea-3&category_id=32, 13 May 2017. (in Chinese)seeking to settle the SCS issues through agreement. In the present case, to determine whether the Philippines had violated the “pre-requirements”, the status of the DOC as an “agreement”, as referred to by Articles 280 & 281, or not should be demonstrated fi rst. In the Memorial, the Philippines alleged that the DOC only used the term “declaration” but not “agreement” in its preamble, and the term “undertake” in the DOC did not mean “agree” with a mandatory nature. Additionally, it claimed that the circumstances surrounding the DOC’sadoption provide further evidence that it was not intended to be a legally binding instrument, but a non-binding political instrument adopted on the basis of a series of compromises reached by the States.①Memorial, para. 7.55.These views of the Philippines are arbitrary and one-sided, since it denied and distorted the objectives the signatory States of the DOC undertook to achieve, simply by virtue of some terms used by the DOC. As provided by Article 2(1) of VCLT, “‘treaty’ means an international agreement concluded between States in written form and governed by international law, whether embodied in a single instrument or in two or more related instruments and whatever its particular designation.”②Vienna Convention on the Law of Treaties, at http://www.fmprc.gov.cn/mfa_chn/ziliao_611 306/tyti_611313/t83909.shtml, 2 April 2017.That is to say, international instruments, whatever their particular designations (treaty, statement, declaration, interim agreement or memorandum), have identical ef f ect under international law, as long as the parties which signed, ratif i ed, accepted or endorsed the instruments have an intent to create rights and obligations.③Thomas Buergenthal and Sean D. Murphy, Public International Law, 3rd edition, Eagan: West Group, 2002, pp. 102～103; Robert Jennings and Arthur Watts eds., Oppenheim’s International Law, Volume 1 (Peace), 9th edition, London/New York: Addison Wesley Longman Inc., 1996, pp. 1208～1209.Therefore, the determination of the status of the DOC as a legally binding document vel non, cannot simply rely on the name of the document; rather, it depends on whether China and the ASEAN States had an intent to create rights and obligations upon its conclusion. Apart from that, according to the explanations provided by Oxford Advanced Learner’s Dictionary and other authoritative dictionaries, the term “undertake” includes the meaning“to agree”. Notably, the term “undertake” was used by 1907 Convention for the Pacific Settlement of International Disputes, and repeatedly appeared in the text of its Articles 23, 41, 43 and 75. It shows that the word “undertake” articulates a legally binding effect in that convention.④1907 Convention for the Pacif i c Settlement of International Disputes, Articles 23, 41, 43, 75.When signing the DOC in 2002, the Philippines “undertook” to resolve SCS issues through “friendly consultations and negotiations”. All the signatory States are committed to implementing the DOC and the guides to actions formulated after the execution of the DOC, as well as the preparation of plans for cooperation on the SCS, which shows that the signatory States have an intent to create rights and obligations. Of course, these States may inevitably encounter some dilemmas where a settlement cannot be reached,however, it cannot lead to the arbitrary view that the DOC is a political document without binding force, since these signatory States have never stopped resolving specific SCS issues through the way they “undertook” to take. Additionally, the Philippines’ continuous participation in the drafting of the follow-up actions, guides and programs concerning the DOC and its start of such programs, evinces its willing to be bounded by the DOC through the way it “undertook” to take. That is to say, the DOC is an international instrument with both political and legal nature signed between China and the ASEAN States. It belongs to a kind of “agreement” provided in Articles 280 and 281 of the UNCLOS, which may preclude the recourse to any compulsory arbitral procedure.①Song Yann-huei, “The South China Sea Arbitration Case Filed by the Philippines against China”: A Discussion on Preliminary Objections to the Tribunal’s Jurisdiction, Chinese Review of International Law, No. 2, 2014, p. 31. (in Chinese)Furthermore, the Philippines, in its Submission 11, argued that China breached its obligation to protect marine environment at the Huanyan Island and Ren’ai Reef, as provided under the UNCLOS. However, the truth is that the Philippines had never, according to the UNCLOS, fulfilled its obligation to exchange views with China in good faith with respect to marine environmental issues,②UNCLOS, Article 283(1).nor the obligation to exhaust local remedies.③UNCLOS, Article 295.On the one hand, the Philippines alleged that it had performed its obligations to exchange views and exhaust local remedies; nevertheless, on the other hand, it still attended all meetings convened by China and the ASEAN States regarding the settlement of SCS issues. In such meetings, the Philippines failed to express any objections or make any relevant reservations. In this connection, its position was inconsistent with its acts in the international arena. By doing so, the Philippines purported to hide the truth that “the disputes are being negotiated effectively under a multilateral framework, although without immediate effect”, which violated the doctrines of estoppel and integrity embodied in the principle of good faith.

Third, the Philippines’ unilateral initiation of the compulsory arbitration does not conform with the “restrictive requirements” as prescribed in UNCLOS Part XV, Section 3. The matters submitted by the Philippines concern, in essence, territorial sovereignty and marine boundary delimitation. Notably, territorial sovereignty issues are not governed by the UNCLOS, and delimitation issues are excluded by the declaration made by China in 2006. If the Philippines wants to successfully startthe arbitral procedure, apart from the pre-requirements provided for in Articles 280 and 281 of the UNCLOS, it still has to meet the “restrictive requirements” under Article 298. For the purpose of evading China’s declaration of 2006, and coping with the “restrictive requirements” under the UNCLOS in a perfunctory way, the Philippines spared no ef f ort to disguise its territorial sovereignty claims into issues concerning the entitlements of each and every marine feature, by fragmentizing its territorial sovereignty and using word tricks. It ultimately attempted to exclude its claims from the delimitation disputes covered in China’s declaration of 2006. The Preamble of the UNCLOS explicitly states that “Conscious that the problems of ocean space are closely interrelated and need to be considered as a whole.”①UNCLOS, Preamble, para. 3.In this sense, the Philippines’ disintegration of its disputes with China has derogated from the spirit of the UNCLOS. Additionally, the Philippines failed to construe the true meaning of Article 298(1)(a)(i) in good faith. Instead, it maliciously evade delimitation issues; it disintegrated its territorial sovereignty by “harming its own rights”,②LUO Gang, The Principle of Good Faith and Abuse of Procedural Rights in International Law from the Perspective of Legal Realism – Taking the SCS Arbitration as an Example, in KONG Qingjiang ed., International Law Review, Vol. 7, Beijing: Tsinghua University Press, 2016, p. 24. (in Chinese)with an aim to fragmentize China’s territorial sovereignty within the SCS and limit China’s claims to maritime rights and interests. In its 15 Submissions, the Philippines argued that Huangyan Island, Chigua Reef, Huayang Reef and Yongshu Reef were not entitled to exclusive economic zone (EEZ) and continental shelf; and that Meiji Reef, Ren’ai Reef, Zhubi Reef, Nanxun Reef and Ximen Reef (including Dongmen Reef) were not able to generate territorial sea, EEZ or continental shelf. The marine features named above, in fact, are located within the areas under the control of China. As a matter of fact, the Philippines had, on many international occasions and in a great number of international documents, admitted its territorial sovereignty over these marine features, long before the start of the arbitration. For example, the Philippines, in the diplomatic note of 5 April 2011 (No. 000228), stated “the Republic of the Philippines has sovereignty and jurisdiction over the geological features in the Kalayaan Island Group”.③The Philippines, Communication dated 5 April 2011, at http://www.un.org/Depts/los/clcs_ new/submissions_f i les/vnm37_09/phl_re_chn_2011.pdf, 16 February 2016.In addition, during the deliberation of the Magallona v. Ermita case, the Supreme Court of the Philippines mentioned that the Philippine Congress had identif i ed the Kalayaan Island Group as “regime of islands”, and the Philippines enjoyed territorial sovereignty overthe features of Kalayaan Island Group, which was consistent with Philippine constitution.①Michael Sheng-ti Gau, The Jurisdiction and Admissibility Rulings of the South China Sea Arbitration: Errors in Law and in Fact, Journal of Boundary and Ocean Studies, Vol. 2, No. 1, 2017, p. 18. (in Chinese)In order to successfully start the compulsory arbitral proceeding, the Philippines acted inconsistently with its state practices to avoid the restrictive requirement under UNCLOS Article 298, which obviously breached the doctrines of estoppel and integrity derived from the principle of good faith. The Philippines, prima facie, tried to settle its disputes with China through pacif i c and legal means, but, in essence, intended to impair the maritime rights and interests of China by resorting to the dispute settlement mechanism or procedures under the UNCLOS. This sham is obviously willful, since it represents an abuse of rights, severely derogating from the object and purpose of the UNCLOS.

2. The Tribunal Violated the Principle of Good Faith and“Created Law When Deciding the Case” by Abusing Its Jurisdiction

In the SCS Arbitration unilaterally fi led by the Philippines, one of the most controversial issues concerns the jurisdiction of the Tribunal. To address this issue, we should first make clear the following questions: what is jurisdiction? who determines the jurisdiction of a tribunal? what factors govern the exercise of jurisdiction? and what effect does an award made beyond the jurisdiction of a tribunal have? That is to say, we need first understand the basic theories of jurisdiction, before exploring the jurisdiction issue in the SCS Arbitration. Jurisdiction has solid judicial foundation both home and abroad, and was widely applied in judicial practices. In the view of the American-Mexican General Claims Commission set up in 1923, jurisdiction is the power of a tribunal to determine a case conformably to the law creating the tribunal or some other law defining its jurisdiction.②Genie Lantman Eltom (U.S.A.) v. United Mexican States, 13 May 1929, Reports of International Arbitral Awards, p. 533, at http://legal.un.org/riaa/cases/vol_IV/529-534. pdf, 24 May 2017; Salem Case (Egypt, USA), 8 June 1932, Reports of International Arbitral Awards, p. 1205, at http://legal.un.org/docs/?path=../riaa/cases/vol_II/1161-1237. pdf&lang=O, 24 May 2017; Corfu Channel (United Kingdom of Great Britain and Northern Ireland v. Albania), Dissenting Opinion by Judge ad hoc Daxner, ICJ Reports 1948, p. 39.It follows that jurisdiction is created by law. Rights coexist with obligations. The enjoyer of jurisdiction should also undertake duties corresponding to its jurisdiction, and serves for the purpose of the law creating itself. And the enjoyer should also exercise its jurisdiction within, but not beyond, the prescribed limits of its power. Hence, courts should not deliberate and rule on any factsinvolved in a case over which they lack jurisdiction. This is based on a common notion encompassed in all judicial regimes. That is, judgments, if rendered in excess of jurisdiction, may be treated as null and void, and international tribunals have universally regarded the question of jurisdiction as fundamental.①Mavronmmatis Palestine Concessions, Dissenting Opinion by M. Moore, Series A, No. 2, PCIJ, 1924, pp. 57～60.United States-Canada Northeastern Boundary Arbitration, 1831,②John Bassett Moore, History and Digest of the International Arbitrations to Which the United States Has Been a Party, Vol. 1, Washington: Government Printing Office, 1898, pp. 85～161.and Orinoco Steamship Company Case (United States of America/Venezuela), 1910,③James Brown Scott ed., The Hague Court Reports, 1st Series, Oxford: Oxford University Press, 1916, pp. 505～506.among others, have proved this fact.

The above cases show that not only unauthorized decisions (lack of jurisdiction), but also decisions arrived at in disregard of the constitution of a tribunal, either as to the object of the submission or the legal principles to be applied (excess of competence), are null.④Bin CHENG, HAN Xiuli and CAI Congyan trans., General Principles of Law as Applied by International Courts and Tribunals, Beijing: Law Press China, 2012, p. 267. (in Chinese)In other words, a tribunal should be constituted in accordance with the agreement creating its rights and obligations, and should not act in contravention to the object and purpose of the agreement. Inter alia, decisions should not be rendered in violation of the compulsory provisions under the agreement relating to applicable laws or legal principles; otherwise, the decisions would be considered as null. With respect to the issue of jurisdiction, the PCIJ held that “The Court’s jurisdiction depends on the will of the Parties.”⑤Rights of Minorities in Upper Silesia (Minority Schools), Judgment, Series A, No. 15, PCIJ, 1928, p. 22; Anglo-Iranian Oil Co. Case (Jurisdiction), Judgment of 22 July 1952, ICJ Reports 1952, p. 103.Consequently, the parties to a case form a critical factor in the establishment and exercise of jurisdiction. As noted by the ICJ, in the Eastern Carelia, 1923, that “It is well established in international law that no State can, without its consent, be compelled to submit its disputes with other States either to mediation or to arbitration, or to any other kind of pacif i c settlement.”⑥Status of Eastern Carelia, Advisory Opinion, Series B, No. 5, PCIJ, 1923, p. 27.That is to say, the jurisdiction of a court is established on the basis of the consent of the parties to a case. This contention was echoed by the ICJ in the Corfu Channel case, 1948.⑦Corfu Channel (United Kingdom of Great Britain and Northern Ireland v. Albania), Judgment on Preliminary Objection, ICJ Reports 1948, pp. 27～28.With regards to the power todetermine the extent of jurisdiction, the PCIJ stated, in Advisory Opinion (No. 16), that “as a general rule, any body possessing jurisdictional powers has the right in the fi rst place itself to determine the extent of its jurisdiction.”①Interpretation of the Greco-Turkish Agreement of 1 December 1926 (Final Protocol, Article IV), Advisory Opinion, Series B, No. 16, PCIJ, 1928, p. 20; Zeltweg-Wolfsberg and Unterdrauburg-Woellan Railways Case (Preliminary Objection), 1934, Reports of International Arbitral Awards, Vol. III, p. 1803, at http://legal.un.org/docs/?path=../riaa/ cases/vol_III/1795-1815.pdf&lang=O, 25 May 2017.Jurisdiction is of a judicial character, it therefore constitutes a source of the legitimacy of judicial decisions.②ZHANG Hua, The Emerging Problem of Non-appearance in the UNLCOS Dispute Settlement Mechanism, Pacif i c Journal, Vol. 22, No. 12, 2014, p. 8. (in Chinese)In that case, when determining the extent of its jurisdiction, the court should interpret its power in a restrictive fashion. This view is ref l ected in a huge number of international cases. For example, the PCIJ, in the Free Zones of Upper Savoy and the District of Gex, 1932, pointed out that, “The Court does not dispute the rule invoked by the French Government, that every Special Agreement, like every clause conferring jurisdiction upon the Court, must be interpreted strictly,”③Case of the Free Zones of Upper Savoy and the District of Gex, Judgment, Series A/B, No. 46, PCIJ, 1932, pp. 138～139.“but that rule could not be applied in such a way as to give the Special Agreement, under the guise of strict interpretation, a construction according to which it would not only fail entirely to enunciate the question really in dispute, but would, by its very terms, have prejudged the answer to that question.”④Case of the Free Zones of Upper Savoy and the District of Gex, Judgment, Series A/B, No. 46, PCIJ, 1932, p. 139.This view was shared in both Greco-Bulgarian case, 1919, and Chorzów Factory case, 1927.

The statements above shows that international judicial practices, in most cases, favored strict interpretation, so as to limit the exercise of jurisdiction, and avoid to rendering the outcome of a case unfair or null due to excess of competence. However, since the establishment and exercise of jurisdiction is, to some extent, of a discretional character, it is easily af f ected by subjective factors, and vulnerable to moral risks. If the jurisdiction is willfully exercised and abused, the corresponding decision would be short of legitimacy and justice. Examples of abuse of jurisdiction are abundant in international judicial practices. For example, both Chagos Marine Protected Area Arbitration (Mauritius v. United Kingdom), and Request for Advisory Opinion on Flag State Responsibility for Illegal Fishing in the EEZ submitted by the Sub-Regional Fisheries Commission to the ITLOS, showcase the current game between “self-restriction of power” and “expansion of power” ofinternational dispute settlement bodies. An international judicial or arbitral body, when exercising its jurisdiction in the settlement of inter-State disputes, shall not arbitrarily expand or abuse its rights, contrary to the goal for which the member States established it. Such behaviors would not only impair judicial credibility, but also prejudice the stability of the existing order. Moreover, such a judicial or arbitral body is obliged to be more prudent, when exercising its authorities and powers, especially jurisdiction. In other words, it should adhere to the principle of judicial restraint.①YE Qiang, Challenges for China Concerning International Judicial Intervention in Its Battle for Maritime Rights and Interests with Neighboring States: A Perspective from Two Cases, World Af f airs, No. 10, 2015, pp. 25～27. (in Chinese)However, the mere “principle of judicial restraint” is not sufficient to prevent the abuse of jurisdiction, which should be jointly regulated by other legal rules or principles, especially the principle of good faith – one of“the general principles of law recognized by civilized nations”. Therefore, an international dispute settlement body should also comply with the principle of good faith when exercising its jurisdiction. However, in the SCS Arbitration brought by the Philippines, the Tribunal failed to follow the principles of judicial restraint and good faith. Specif i cally, it def i nitely expanded its power and arbitrarily construed some legal provisions, deviating from the common goal for which the States Parties signed the UNCLOS. All these ultimately result in a partial award.

First, the Tribunal arbitrarily delivered its decisions without conducting examination and review in good faith. For example, it directly ruled that the Philippines complied with UNCLOS Article 300 by only invoking some individual and partial views. China insists that the Philippines’ unilateral initiation of the compulsory arbitration amounts to an unlawfully abuse of its procedural rights. In this connection, whether the Philippines has fulfilled its obligations in good faith and abused its rights is a main point in this dispute, and also one of the“prerequisites” and legal basis for the Philippines’ successful start of an arbitral procedure. Under such a controversial circumstance, the Tribunal, as an umpire, should handle the issue in good faith with more prudent attitude. Conversely, the Tribunal deliberately beat around the bush: it disregarded the examination of the Philippines’ abuse of arbitral procedure, but directly determined that the Philippines’ unilateral filing of the arbitration was consistent with Article 300 of UNCLOS, without abuse of rights, by simply invoking Barbados v. Trinidadand Tobago, 2006.①The Republic of the Philippines v. The People’s Republic of China, Award on Jurisdiction and Admissibility, 29 October 2015, para. 126.Such an arbitrary decision violated Article 38 of the Statute of the International Court of Justice, since partial views cannot become a rule of international law. Judicial organs should rule on a case, following, in good faith, the principle of “taking facts as the basis and the law as criterion” and taking into account the details of the case. However, in the SCS Arbitration, the Tribunal failed to objectively examine the facts involved in the case, or apply the relevant laws. It, in not more than two pages of the Award on Jurisdiction and Admissibility, adjudicated on whether the Philippines’ fi ling of the arbitration had constituted an abuse of right, by simply invoking one case.②LUO Gang, The Principle of Good Faith and Abuse of Procedural Rights in International Law from the Perspective of Legal Realism – Taking the SCS Arbitration as an Example, in KONG Qingjiang ed., International Law Review, Vol. 7, Beijing: Tsinghua University Press, 2016, p. 21. (in Chinese)This award is ill-founded in fact and law, obviously derogating from the requirements of “being reasonable” and“legitimate”, as embodied in the principle of good faith.

Second, the Tribunal, deviating from the spirit of the UNCLOS, strictly interpreted UNCLOS Article 281 in bad faith. On international law, the start of an international dispute settlement procedure, in most cases, is subject to the consent of the parties to a dispute. The ICJ underlined this point in the Eastern Carelia case, and also reiterated, in the Interpretation of Peace Treaties Case, that “The consent of States, parties to a dispute, is the basis of the Court’s jurisdiction in contentious cases.”③Interpretation of Peace Treaties with Bulgaria, Hungary and Romania, Advisory Opinion, ICJ Reports 1950, p. 71; Nottebohm Case (Preliminary Objection), Judgment of 18 November 1953, ICJ Reports 1953, p. 122; Case of the Monetary Gold Removed from Rome in 1943 (Preliminary Question), Judgment of 15 June 1954, ICJ Reports 1954, p. 32; Phosphates in Morocco, Judgment, Series A/B, No. 74, PCIJ, 1938, p. 24.The dispute settlement mechanisms under UNCLOS include both voluntary and compulsory ones, however, the selection of such mechanisms still subjects to the “consent of the parties to a dispute”, which is commonly recognized in the international law. Resorting to voluntary mechanism first and compulsory one second, and relaxing the standard of legal interpretation is the basic spirit that the UNCLOS seeks for the establishment of dispute settlement mechanisms.④LUO Gang, The Truth of International Law and Fundamental Flaws in the SCS Arbitration between China and the Philippines, at http://www.aisixiang.com/data/100801.html, 27 March 2017. (in Chinese)Therefore, in the Sino-Philippine SCS Arbitration, whether the DOC can be treated as an “agreement” within the meaning of Article 281 is a “pre-requirement” that the Philippines has to meet, if it intends to initiate an arbitral procedure. Article 281 has no explicit provision on the nature of “agreement”, nor any specif i c requirement that the “agreement” should be legally binding. Under this circumstance, the treaty interpreter shall, as per Article 31(1) of VCLT, construe the term in good faith. Arbitral bodies with judicial capacities should put more ef f orts in complying with the principle of judicial restraint. However, the Tribunal, for the purpose of expanding its power, assumed that it had the freedom to construe a term where an express provision was absent. Based on this assumption, it construed the“agreement” under Article 281 as the agreement with legally binding force. Such a strict and rigid interpretation not only disregarded and violated the principle of good faith in terms of treaty interpretation, but also severely derogated from the spirit of UNCLOS which encourages the freedom of choice in dispute settlement mechanisms.①LUO Gang, The Truth of International Law and Fundamental Flaws in the SCS Arbitration between China and the Philippines, at http://www.aisixiang.com/data/100801.html, 27 March 2017. (in Chinese)

Third, the Tribunal, with the view of establishing its jurisdiction, construed the nature of the “dispute” under UNCLOS Article 298 as a whole, defeating the object and purpose of UNCLOS. In accordance with Article 298 and Annex VII of UNCLOS, the Tribunal’s jurisdiction is only limited to “any dispute concerning the interpretation or application of the UNCLOS”. Whether or not the matters covered in the reservation made by China in 2006 should be considered as a dispute that is, in line with the declaration under Article 298, excluded from compulsory procedures, is critical to the establishment of the Tribunal’s jurisdiction. That is to say, the nature of the “dispute” and its definition concern the establishment of the Tribunal’s jurisdiction. If the “dispute” does not concern the application or interpretation of the UNCLOS, the Tribunal would have no jurisdiction over it. Accordingly, the Tribunal must deal with two issues: one is to determine the nature of the dispute, and the other is to decide whether the dispute concerns the interpretation or application of the UNCLOS.②ZHANG Zuxing, South China Sea Arbitration: A Critical Review of the Rulings by the Tribunal concerning Historic Rights Claim, Southeast Asian Studies, No. 6, 2016, p. 47. (in Chinese)The determination of the nature of the dispute serves as a critical and turning point in the Arbitration. It is generally recognized in international law that a dispute is a disagreement on a point of law orfact, a conf l ict of legal views or of interests between two persons.①The Mavrommmatis Palestine Concessions, Judgment (Objection to the Jurisdiction of the Court), Series A, No. 2, PCIJ, 1924, p. 11.In the view of Robert Jennings, a legal dispute, in the technical and practical sense, is a series of pending issues that are processed and restored into a form capable of being decided by a court.②Robert Jennings, Reflection on the term “dispute”, in Collected Writings of Sir Robert Jennings, Vol. 2, The Hague/Boston: Kluwer Law International, 1998, p. 584.When defining the nature of a dispute, “a court or tribunal should consider ‘not only’ the statement of claim and fi nal submissions, but also ‘diplomatic exchanges, public statements and other pertinent evidence’, as well as the conduct of the parties both prior to and after the commencement of legal proceedings.”③Memorial, para. 7.11.In the present case, the Tribunal asserted that:

First, where a party has declined to contradict a claim expressly or to take a position on a matter submitted for compulsory settlement, the Tribunal is entitled to examine the conduct of the Parties – or, indeed, the fact of silence in a situation in which a response would be expected – and draw appropriate inferences. Second, the existence of a dispute must be evaluated objectively. The Tribunal is obliged not to permit an overly technical evaluation of the Parties’ communications or deliberate ambiguity in a Party’s expression of its position to frustrate the resolution of a genuine dispute through arbitration.④The Republic of the Philippines v. The People’s Republic of China, Award on Jurisdiction and Admissibility, 29 October 2015, para. 163.

The criteria put forward by the Tribunal are not utterly unreasonable. However, when applying these criteria, the Tribunal, in most cases, excluded those barring the establishment and exercise of its jurisdiction. It, on the one hand, deliberately evaded and reduced its obligation to expound and verify the Philippines’ claims, but on the other hand, it intentionally distorted China’s position and statements. Under the circumstance where facts are unclear and evidences are insufficient, the Tribunal directly arrived at the wrong decision that the “dispute” submitted by the Philippines neither concerned territorial sovereignty nor maritime delimitation.⑤The Republic of the Philippines v. The People’s Republic of China, Award on Jurisdiction and Admissibility, 29 October 2015, paras. 152, 153, 155.In fact, when it comes to treaty interpretation, the Tribunal, resembling the Philippines, chose to fragmentize the whole dispute into pieces, and then excludedthose legal barriers challenging the establishment and exercise of its jurisdiction, especially the declaration made by China in 2006 in accordance with UNCLOS Article 298. Actually, both China and the Philippines had admitted that their dispute, in essence, concerned territorial sovereignty and maritime delimitation, which is also mirrored in their diplomatic statements and documents, and widely known in the international arena. Nevertheless, the Tribunal, for the purpose of establishing and protecting its jurisdiction, chose to disregard this fact.

Fourth, the Tribunal failed to discharge its general obligation to ascertain the facts as provided for in UNCLOS Annex VII, Article 9. This Article 9 prescribes that absence of a party shall not constitute a bar to the proceedings, but the arbitral tribunal shall undertake certain responsibilities: it “must satisfy itself not only that it has jurisdiction over the dispute but also that the claim is well founded in fact and law.” This is a general obligation, whose application is not limited to the situation where a party does not appear before the arbitral tribunal.①M. C. W. Pinto, The Interpretation of United Nations Convention on the Law of the Sea and the International Rule of Law, Journal of Boundary and Ocean Studies, No. 2, 2016, p. 43. (in Chinese)The provision that “absence of a party shall not constitute a bar to the proceedings” indicates that the arbitral tribunal, in this situation, has some discretion to decide whether or not to continue the proceedings. Nonetheless, the arbitral tribunal shall also subject to some restrictions. Specif i cally, it should, in line with the principle of taking facts as the basis and the law as criterion, seriously consider and examine the absence of a party. In the present case, China did not appear before the Tribunal due to its doubts over the Tribunal’s jurisdiction, which shows that China disagrees with the proceedings. As described above, the consent of States is the basis of the court’s jurisdiction in contentious cases. In this case, the Tribunal cannot simply, as per the procedural rules of arbitration, treat China’s conduct as “non-appearance”. Additionally, the provisions regarding dispute settlement under the UNCLOS did not specify how the arbitral tribunal should continue the proceedings, when a party to a dispute fails to give its consent or appear before the tribunal.②M. C. W. Pinto, The Interpretation of United Nations Convention on the Law of the Sea and the International Rule of Law, Journal of Boundary and Ocean Studies, No. 2, 2016, p. 43. (in Chinese)Seen from another angle, it actually concerns a question: in the absence of a party, should the arbitral tribunal adopt the strategy of judicial activism or restraint? Robert Kolb, a Swiss jurist who has summarized nearly 70 years of the judicial experiences ofthe ICJ, answered the question in the following way: judicial activism and restraint fall under the scope of the judicial policies issued by the ICJ. The choosing of the two depends on various elements. Specifically, where a case involves international crises, the Court had better adopt a cautious and restrictive attitude in the application of laws; where the political relations between the parties to a dispute are tense, or where the circumstances between the parties do not allow any aggressive decisions, adopting a cautious attitude may contribute to the reaching of understanding by the parties. When the legal issues involved in a case coincidently constitute the subject of the negotiation concerning a multilateral treaty, and that treaty may alter current rules, the Court, for the purpose of avoiding intervening with multilateral legislative function, should also adopt a restrictive position.①Robert Kolb, The International Court of Justice, Oxford: Hart Publishing, 2013, p. 1175.This rational perspective is consistent with the spirit of UNCLOS; adopting this perspective would contribute to the resolution of the disputes between China and the Philippines in the present case. The SCS Arbitration involves more than two States in interest, and these States have always been active in holding all kinds of conventions and taken corresponding measures, with a view to facilitating the settlement of their disputes. Inter alia, all the States concerned signed the DOC. All the States Parties which have signed and accepted the declaration have always been dedicated to implementing its specific provisions, in an effort to create rights and obligations for themselves. Given the complexity of the SCS Arbitration, the Tribunal is supposed to fulf i ll the general obligation to ascertain the facts under UNCLOS Annex VII, Article 9, and adopt the strategy of judicial restraint, or comply with the principle of judicial self-restraint. Nevertheless, in order to “maintain its power (jurisdiction)”, it acted against the principle above in the following way: it utterly disregarded the pacif i c settlement of disputes, and absolutely exercised its discretion, which amounts to a breach of the UNCLOS.

Fifth, the Tribunal abused evidences, resulting in the obvious fl aws found in the phase of facts ascertaining. In the Award on Jurisdiction and Admissibility, the Tribunal, for the purpose of proving that Submissions 3, 4, 6 and 7 of the Philippines concerned the dispute between the two States, invoked the diplomatic notes between the two parties in 2011 as evidences.②The Republic of the Philippines v. The People’s Republic of China, Award on Jurisdiction and Admissibility, 29 October 2015, p. 66.However, these notes of 2011 were issued in response to the notes delivered by China in 2009. Consequently, theinterpretation and application of the notes of 2011 cannot be isolated from China’s notes of 2009. Nevertheless, the Tribunal intentionally ignored the existence of notes of 2009; it selectively invoked the notes of 2011 to directly reach the conclusion: the Philippines’ Submissions 3, 4, 6 and 7 could reflect the dispute between China and the Philippines with respect to the legal status of some maritime features. In fact, the note delivered by the Philippines in 2011 did not mention any specif i c features of the “Kalayann Island Group”; in the note, the Philippines merely claimed that these features were “entitled” to territorial sea, EEZ and continental shelf.①The Philippines, Communication dated 5 April 2011, pp. 2～3, at http://www.un.org/Depts/ los/clcs_new/submissions_f i les/vnm37_09/phl_re_chn_2011.pdf, 16 February 2016.Such typical official statements are inconsistent with the“structure” of the Philippines’ Submissions 3, 4, 6 and 7. However, in the present arbitration, the Philippines changed its position, claiming that none of features of the “Kalayann Island Group” can be qualif i ed as an island capable of generating territorial sea, EEZ and continental shelf.②The Republic of the Philippines v. The People’s Republic of China, Final Transcript Day 1-Jurisdiction Hearing, 7 July 2015, pp. 44～45.The Tribunal turned a blind eye to such obviously self-contradictory conducts of the Philippines, but criticized China and distorted the real meanings of China’s diplomatic notes. In China’s notes of 2011, China claimed the maritime entitlements (i.e., territorial sea, EEZ and continental shelf) under the UNCLOS based on the Nansha Islands in its entirety, rather than any named features. These notes neither separately mentioned any features of the Nansha Islands, nor discussed whether these features were entitled to such marine areas.③Michael Sheng-ti Gau, The Jurisdiction and Admissibility Rulings of the South China Sea Arbitration: Errors in Law and in Fact, Journal of Boundary and Ocean Studies, Vol. 2, No. 1, 2017, p. 17. (in Chinese)Facing the claims that China has never raised, and the self-contradictory statements of the Philippines, the Tribunal, simply based on the diplomatic notes communicated between the two parties in 2011, arrived at the conclusion that real“dispute” existed between them. It is submitted that the Tribunal arbitrarily used evidences, leading to obvious and severe fallacies in fact.

B. Substantive Aspect

The Tribunal, for the sake of consolidating its “absolute” jurisdiction, disregarded the object and purpose of the UNCLOS, created new criteria through“judicial lawmaking” and expressed many views derogating from the commonunderstanding of the international community. With regards to substantive issues, the Tribunal and the Philippines tacitly took the same position, and did their utmost to cryptically render the rights within the “dashed line” meaningless through “three keys”, so as to impair the rights that China claimed in the SCS. The three keys are detailed as follows: firstly, in order to exclude the application of the declaration made under UNCLOS Article 298, they wrongly distorted the connotations of the historic rights within the “dashed line”, and distanced historic rights from historic title; secondly, the Tribunal, through “judicial lawmaking”, created new criteria for assessing an island, and misinterpreted the provisions about island under Article 121, so as to vitiate the maritime entitlements of all islands in the SCS, and further to exclude maritime delimitation issues from the dispute submitted by the Philippines; thirdly, in the absence of maritime delimitation issues, the Tribunal def i nitely supported the Philippines’ claims of rights to EEZ or continental shelf. Once the fi rst two tasks are completed, the Tribunal and the Philippines may act arbitrarily. And the third one is certainly under their control.

1. Malicious Misinterpretation of the Connotations of the Historic Rights within the “Dashed Line” against the Object and Purpose of the UNCLOS

The Tribunal’s views, in the final award released on July 12, 2016, can be summarized into three points. Firstly, the Tribunal held that the historic title under UNCLOS refers to claims of historic sovereignty over bays and other near-shore waters, while China claimed historic rights to resources within the “dashed line”, but did not claim historic title over the waters of the SCS.①Summary of the Tribunal’s Decisions on Its Jurisdiction and on the Merits of the Philippines’ Claims.Secondly, in the view of the Tribunal, the UNCLOS comprehensively allocated the rights of States to maritime areas; considering the protection of pre-existing rights to resources, such rights to resources were incorporated into the final text of the Convention, and became a part of maritime rights. Although Chinese navigators and fishermen, as well as those of other States, had historically made use of the islands in the SCS, such historical navigation and fi shing represented the exercise of high seas freedoms, rather than a historic right, and that there was no evidence that China had historically exercised exclusive control over the waters and resources of the SCS.②Summary of the Tribunal’s Decisions on Its Jurisdiction and on the Merits of the Philippines’ Claims.Thirdly, the Tribunal concluded that even if China had historic rights to resources in the waters of the SCS, such rights were extinguished by the entry into force ofthe Convention; accordingly, there was no legal basis for China to claim historic rights to resources within the sea areas falling within the “dashed line”.①Summary of the Tribunal’s Decisions on Its Jurisdiction and on the Merits of the Philippines’ Claims.

No consensus has been reached over the concrete connotations of the historic rights within the “dashed line”. Currently, there are mainly two interpretations: one tends to interpret these historic rights narrowly as rights to use (sovereign rights), and the other tends to construe them broadly as title (sovereignty).②LUO Gang, The Truth of International Law and Fundamental Flaws in the SCS Arbitration between China and the Philippines, at http://www.aisixiang.com/data/100801.html, 27 March 2017. (in Chinese)Apparently, the Tribunal chose the narrow interpretation. In other words, the Tribunal held that China’s historic rights within the “dashed line” only covered “rights to living and non-living resources”. This fi nding of the Tribunal was principally based on three evidences presented by the Philippines: a). on 6 July, 2011, the Embassy of China in Manila issued a note verbale to the Department of Foreign Af f airs of the Philippines, protesting against the Philippines’ announcement of blocks for petroleum exploration within the “dashed line”; b). in 2012, the China National Offshore Oil Corporation (CNOOC) issued a notice of nine open blocks for petroleum exploration in the SCS; c). in May 2012, the Fishery Bureau of Nanhai District under the Chinese Ministry of Agriculture announced a Summer Ban on Marine Fishing in the South China Sea Maritime Space. The announcement provided that “All productive activity types … shall be prohibited … in the South China Sea areas from 12° north latitude up to the ‘Common Boundary Line of Fujian-Guangdong Sea Areas’ (including the Gulf of Tonkin) under the jurisdiction of the People’s Republic of China.”③The Republic of the Philippines v. The People’s Republic of China, Award, 12 July 2016, paras. 207～213.The Philippines produced the three evidences to demonstrate that China’s claims of historic rights in the SCS were not claims to sovereignty over the sea, but exclusive rights to the living and non-living resources of the waters and seabed enclosed by the “dashed line”.④The Republic of the Philippines v. The People’s Republic of China, Final Transcript Day 1 – Hearing on the Merits and Remaining Issues of Jurisdiction and Admissibility, 24 November 2015, p. 27.The Tribunal completely accepted the evidences and views of the Philippines, asserting that China’s claims to historic rights within the “dashed line” were exclusive in nature. Nevertheless, the three evidences listed above cannot fully ref l ect the nature of China’s historic rights. They merely represent China’s claims and exercise,in virtue of the UNCLOS, of its rights to its EEZ and continental shelf falling within the “dashed line”.①HUANG Yao, China’s Lawful Rights and Interests within the South China Sea Dashedline: Based on the Analysis of the South China Sea Arbitration Award, Frontiers, No. 23, 2016, p. 25. (in Chinese)Additionally, the historic rights China claimed within the “dashed line” are not exclusive, since China had never, prior to its signing of the UNCLOS and pronouncement of its rights to EEZ, limited or prevented the fi shermen of other States from exploiting the resources within the “dashed line”.②HUANG Yao, China’s Lawful Rights and Interests within the South China Sea Dashedline: Based on the Analysis of the South China Sea Arbitration Award, Frontiers, No. 23, 2016, p. 25. (in Chinese)China’s rights (sovereign rights) to the living and non-living resources lying within the “dashed line”, as a matter of fact, are fully based on its title (sovereignty) to the islands enclosed by this line. Such rights (sovereign rights) cannot exist separately from the notion of title (sovereignty).③LUO Gang, The Truth of International Law and Fundamental Flaws in the SCS Arbitration between China and the Philippines, at http://www.aisixiang.com/data/100801.html, 27 March 2017. (in Chinese)However, the Tribunal, for the purpose of consolidating its absolute jurisdiction, misinterpreted China’s historic rights within the “dashed line”, and held that such rights had no reasonable factual basis, nor any sufficient legal basis.

Apparently, the Tribunal considered the UNCLOS as the sole legal basis in the law of the sea, abused its rights and presumed that the UNCLOS had incorporated identical rights into its fi nal text in a tacit fashion. This relates to the issue of rights incorporation under the law of treaty. In fact, UNCLOS Article 311(2)&(5) shows that the Convention respects the existence of other rights, and it did not tacitly incorporated other rights, but rather explicitly reminded States Parties of such rights as created by maritime rules.④LI Zhiwen and MA Yu, Interpretation of the Sovereignty Theory for China’s Position to the South China Sea Arbitration Case, Pacif i c Journal, No. 9, 2016, p. 3. (in Chinese)Generally, the incorporation of certain rights under the law of treaty, in most cases, is done by setting out a special article of consolidation; tacit incorporation does not amount to an ef f ective incorporation of rights.⑤LI Zhiwen and MA Yu, Interpretation of the Sovereignty Theory for China’s Position to the South China Sea Arbitration Case, Pacif i c Journal, No. 9, 2016, p. 3. (in Chinese)Apart from that, an examination of the nature of the UNCLOS tells that the Convention was formulated on the basis of the codif i cation of customary law, but its rules, in nature, remain the rules of treaty law. It is unreasonable to blur the dif f erences between rules of customary international law and treaty law by using the concept of rules of general international law, which is also inconsistent with theconsensus among the international community.①LI Zhiwen and MA Yu, Interpretation of the Sovereignty Theory for China’s Position to the South China Sea Arbitration Case, Pacif i c Journal, No. 9, 2016, p. 3. (in Chinese)Furthermore, the UNCLOS is not the sole legal basis in the law of the sea, which is underlined and acknowledged by the UNCLOS itself in the Preamble. That is to say, the UNCLOS does not have a supremacy over other laws in the realm of the law of the sea, nor regulate all the matters relating to the sea. Matters not regulated by the UNCLOS continue to be governed by general international law.②UNCLOS, Preamble: “Affirming that matters not regulated by this Convention continue to be governed by the rules and principles of general international law.”It is not hard to see, the Tribunal, when adjudicating on China’s historic rights within the “dashed line”, abused its rights, which amounts to a malicious breach of the object and purpose of the UNCLOS. Consequently, the decision made in this connection should be treated as null and void.

2. The Tribunal, through “Judicial Lawmaking”, Created Aggressive Criteria to Judge the Status of a Feature, with a View to Excluding Maritime Delimitation from the Dispute Submitted by the Philippines

In order to completely exclude the matters submitted by the Philippines from maritime delimitation issues which fall within the exception to compulsory jurisdiction under UNLCOS Article 298, and further to guarantee the exercise of its jurisdiction, the Tribunal, through “judicial lawmaking”, misinterpreted Article 121(3) and created new criteria for judging an “island”. In doing so, it reduced all of China’s features encompassed by the “dashed line” into “rocks”and denied China’s legitimate rights within the “dashed line”, further to prevent the emergence of overlapping maritime entitlements and delimitation issues. In the Award, the Tribunal opined, when interpreting Article 121, that whether a maritime feature could be qualif i ed as an island depended on its objective carrying capacity; in other words, it depended on whether a feature itself was capable of sustaining human habitation and supporting an independent economic life, without relying predominantly on the infusion of outside resources or serving purely as an object for extractive activities.③The Republic of the Philippines v. The People’s Republic of China, Award, 12 July 2016, para. 500.Many features in the Nansha Islands were being controlled by dif f erent coastal States. These States constructed infrastructure and stationed personnel on the features, and improved their habitability through the infusion of outside resources. However, this did not constitute evidence that afeature was capable of sustaining human habitation of its own. Therefore, in the words of the Tribunal, all the high-tide features in the Nansha Islands (including, for example, Taiping Island, Zhongye Island, Xiyue Island, Nanwei Island, Beizi Island and Nanzi Island) were legally “rocks” that did not generate an EEZ or continental shelf.①The Republic of the Philippines v. The People’s Republic of China, Award, 12 July 2016, para. 626.

The aggressive criteria set by the Tribunal are not compliant with the requirement of interpreting treaties in good faith as provided for in Article 31(1) of VCLT, nor supported by direct evidences or evidences from field study. Inter alia, the Tribunal, unreasonably and restrictively, construed the term “human habitation”, one of the flexible standard for assessing the carrying capacity of a feature. The Tribunal, through literally interpreting the word “cannot” contained in Article 121(3), directly denied that the official personnel stationed on a feature were indigenous population, therefore the feature lacked the carrying capability of an island. Such a one-sided interpretation does not conform to the spirit of the UNCLOS. A careful examination of the UNCLOS reveals that, with regards to“human habitation” under Article 121(3), the Convention did not expressly provide for the identity of “human”, at least did not directly exclude the habitation of official personnel. Additionally, the existence of government facilities on a feature can serve exactly as an evidence that the feature is capable of “sustaining human habitation”. By reference to the temporary activities conducted by several Japanese fi shing and guano mining enterprises in the 1920s and 1930s, the Tribunal decided that the fi shing activities of Chinese fi shermen for centuries did not have the nature of “sustaining human habitation or economic life.”②LI Guang, The Analysis of the United States’ Position on the South China Sea Dispute in 1930s, Pacif i c Journal, Vol. 24, No. 7, 2016, p. 68. (in Chinese)Such a decision is biased and malicious.

C. Had China Violated the Principle of Good Faith?

In the SCS Arbitration filed by the Philippines, the Philippines alleged that China, through threat of force, expelled the Philippine fishermen who had been fishing around the Huangyan Island continuously for a long period, which not only exacerbated or complicated the SCS situation, but also af f ected the peace andstability of the SCS.①Memorial, paras. 7.71～7.73.In other words, the Philippines claimed that China breached its obligation to exercise self-restraint under the DOC, and aggravated the SCS situation by unpeaceful means, which constituted a violation of the good faith principle. However, as a matter of fact, it is the Philippines’ aggressive actions that forced China to take law enforcement activities. Specif i cally, the Philippines sent warships, attempting to forcefully detain the fi shing boats of Chinese nationality, through use of force or threat of force. Inter alia, in March 2014 when other States were busy in searching for Malaysia Airlines Flight 370 around the SCS, the Philippines seized the chance to send building materials by ships to the sea areas surrounding the Ren’ai Reef, attempting to consolidate its old warship which ran aground on the Ren’ai Reef.②Song Yann-huei, The South China Sea Arbitration Case Filed by the Philippines against China: A Discussion on Preliminary Objections to the Tribunal’s Jurisdiction, Chinese Review of International Law, No. 2, 2014, pp. 30～31. (in Chinese)By doing so, the Philippines intended to seize the opportunity to illegally occupy China’s territory. Such provocative behaviors went against the consensus reached by the signatory States at the conclusion of the DOC, and also exacerbated the situation in the SCS. China’s response to such provocative behaviors is rightful and legal, which does not amount to a breach of the good faith principle. The Philippines, on the one hand, denied the effect of the DOC③Memorial, para. 7.51.and protested against China’s invocation of the DOC, but on the other hand, it raised, in a statement of its Ministry of Foreign Af f airs on 1 August, 2014, a proposal to address the SCS issues, requesting all parties concerned to abide by Article 5 of the DOC, and implement the DOC in a comprehensive and ef f ective way. Such selfcontradictory statements and actions of the Philippines, obviously, went against the principles of estoppel and integrity,④Position 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, 7 December 2014, para. 52.amounting to a breach of the good faith principle.

With respect to the resolution of SCS issues, China and the Philippines have already signed a series of documents, including the Joint Statement between the People’s Republic of China and the Republic of the Philippines concerning Consultations on the South China Sea and on Other Areas of Cooperation (10 August 1995), the Joint Statement of the China-Philippines Experts Group Meeting on Conf i dence-Building Measures (23 March 1999), the Joint Statementbetween the Government of the People’s Republic of China and the Government of the Republic of the Philippines on the Framework of Bilateral Cooperation in the Twenty-First Century (16 May 2000), the Joint Press Statement of the Third China-Philippines Experts’ Group Meeting on Confidence-Building Measures (4 April 2001), the DOC (4 November 2002), the Joint Press Statement between the Government of the People’s Republic of China and the Government of the Republic of the Philippines (3 September 2004), and the Joint Statement between the People’s Republic of China and the Republic of the Philippines (1 September 2011). These bilateral instruments are consistent with the pertinent provisions of the DOC, which all insist on using the purposes and principles of the UN Charters, the UNCLOS, the Treaty of Amity and Cooperation in Southeast Asia, the Five Principles of Peaceful Coexistence, and other universally recognized principles of international law as the basic norms to resolve State-to-State disputes.①Position 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, 7 December 2014, paras. 31～37, 53～54.Particularly, when interpreting the agreement between them and discharging international obligations, the States concerned shall follow the principle of good faith and refrain from misinterpreting the agreement against its originally intended meaning, with a view to gaining illegitimate interests. China has always persisted in following these basic norms and using them to peacefully settle SCS disputes. For example, the Joint Press Statement between the Government of the People’s Republic of China and the Government of the Republic of the Philippines (3 September 2004), the Agreement for Joint Marine Seismic Undertaking in Certain Areas in the South China Sea (14 March 2005), the Joint Statement of the People’s Republic of China and the Republic of the Philippines (28 April 2005) and the Joint Statement of the People’s Republic of China and the Republic of the Philippines (16 January 2007), all indicate that China has always been committed to maintaining the peace and stability of SCS areas.

V. Conclusions and Ref l ections

Good faith serves as the basis of international treaties. It regulates the rights under international law. States’ moral recognition of law is mainly based on good faith. All international communications are build on honesty and credibility. Ifgood faith is disregarded, the legality derived from international law would be extinguished.①Alfred Verdross et al., LI Haopei trans., International Law, Beijing: Commercial Press, 1981, pp. 777～778. (in Chinese)Interpretation in good faith is the precondition of pacta sunt servanda, since interpretation is a part of treaty performance. In this connection, the study and comments on relevant documents should be done in good faith.②Hersch Lauterpacht ed., WANG Tieya and CHEN Tiqiang tans., Oppenheim’s International Law, Vol. 1, No. 2, Beijing: The Commercial Press, p. 204. (in Chinese)The principle of good faith may help to address the rigid shortcomings that are possibly inherent in textual interpretation, and give some flexibilities to interpretation of treaties and realization of justice.③FENG Shoubo, On the Treaty Interpretation in “Good Faith”: An Empirical Research on “Good Faith” in Art. 31.1 of VCLT, Pacific Journal, Vol. 22, No. 5, 2015, p. 8. (in Chinese)In the SCS Arbitration initiated by the Philippines, both the Philippines and the Tribunal obviously breached the principle of good faith. They abused their rights under the UNCLOS, and used the UNCLOS as a tool of international law to attain their political goals, which brazenly undermined the existing order of international law. Therefore, the award delivered by the Tribunal should be deemed as legally unbinding. The principle of good faith, especially its requirement on performing international obligations in good faith, is consistent with the diplomatic philosophy and position that China has always been pursuing. As such, this principle will contribute to China’s protection of its sovereignty and rights in the SCS. Hence, China should pay much attention to the application of this principle, and apply it under more circumstances, especially when the formulation of international rules are involved.

The SCS Arbitration initiated by the Philippines, on the one hand, gives a warning to China, which keeps reminding China that some States may attack other States or impair their rights by using the international law as a tool, with a view to obtaining the alleged “lawful rights and interests”. On the other hand, the arbitration also provides, in the realm of international law, a meaningful research topic for China and Chinese scholars, which would help raise the level and ability of research and application of international law in China, and cope with and prevent subject with willful intents, like the Philippines and the Tribunal, from using the same means to jeopardize China’s legal rights and interests. The SCS Arbitration lasted for more than 3 years, whose inf l uences cannot be underestimated. We should not be over pessimistic about such inf l uences. Instead, we should treat it objectively and reasonably. China, especially Chinese scholars, should not merely dwell onthis arbitration or gradually stop studying it along with the end of the case; rather, it shall further explore the reasons behind and fi nd the countermeasures. China, as a rising power, should be conscious of the dialectical unity between international law and State interests, and improve its ability and level to employ international law, which will contribute to the protection of its national interests. Aside from that, China should also take the initiative to understand the existing rules of international law, and participate in the formulation and implementation of new ones, striving to change the order of international law dominated by the Western States.

Translator: XIE Hongyue

* YAN Yongling, master candidate of international law at the Law School of Hainan University. E-mail: 929406850@qq.com. This paper is a research achievement of the Major Project of the National Social Science Foundation of China (No. 16ZDA073). And it won the fi rst prize of the COLR Open Submission Contest for Criticizing the SCS Arbitration.

© THE AUTHOR AND CHINA OCEANS LAW REVIEW