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This paper , ‘Legal Aspects of the Sino-Japanese “East China Sea Maritime Delimitation Dispute” (2010)’ was submitted by Barrister Aemen Maluka to the University of Aberdeen in 2010 for the partial fulfilment of her Masters in Oil and Gas Law’s course requirements.It is being made available here in full now.The Author is the CEO of Josh and Mak (Legal Research Litigation and Drafting Services). She is a Barrister from the Lincolns Inn and has a Master of Laws Degree from the University of London in Corporate and Communication laws and another Masters in Oil and Gas Law from the University of Aberdeen. Apart from her main specialization in energy law, she has a keen interest in human rights and environmental laws.
Abstract
Long ago wars at sea and at land were the ultimate remedy for the resolution of maritime boundary disputes as a means to reaching a conclusion as to which state should be able to exploit the resources in that area. The author’s is based on the observation that till date at least from the perspective of the East China Sea, the application of the UNCLOS and Customary international law has promoted, rather than diffused the “stalemate” situation in the region mainly due to their vague application and the subsequent reluctance of state parties to rely on these forums of maritime dispute management. In this vein after assessing the option of utilizing the UNCLOS for a peaceful settlement in the East China Sea, the dissertation will examine the case for Joint development of disputed offshore resources (oil and gas) and its legal basis as found in the UNCLOS, as a way out for maritime disputes in the context of the East China Sea Dispute. While it is hoped that the “equitable principles” doctrine will prevail over the idea of the cake-cutting exercise in the name of equidistance should the dispute be taken to the ICJ giving China a better chance to win this case, ICJ history has shown that the outcome of such cases often results in a “draw” or a deadlock after a lot of delays. Finally based on a review of the recent developments and the political realities within the East China Sea region the author does point out that while academics have often proposed that joint development is more conducive to better political and economic ties within the international community, modern history might have different lessons for International lawyers in terms of viewing Joint Development from the perspective of a zero sum game.
Chapter 1
1.1 Introduction
By the end of the first term of my Degree in Masters in Oil and Gas, I remember myself as a starry-eyed, eager law student getting to grips with the legal dynamics of Hydrocarbon state control and contracting. Initially for me in the early part of my readings, any support for Joint Development as a an alternative to actual adjudication of maritime delimitation disputes, denoted a lack of faith on the part of the world community in the effectiveness of the International Law of the Sea, in preventing a certain rogue state from snatching away from an innocent, victim state, a little more of the maritime area than its fair entitlement. A few months later, after a precursory observation of the changing political situation around the world, the increasing reliance by state parties upon such measures as bilateral and multilateral Joint Development arrangements began to make greater sense to me.
I learnt very quickly that in International politics there are no “good” or “bad” or even “evil” states. The race for energy security is a battle for economic stability being fought by each state capable of ensuring its survival against other competing actors. And since the age of fighting a bloody battle for proclamation of territories was long gone with the Second World War, these states would have to learn to survive side by side while securing their energy supplies and reserves through mutual co-operation and agreement. What emerged now was a new sharp, non-legal reality that to view Law of the Sea in isolation from Politics and Economics would be at its very best a naïve perception[1]. There was a lot more to two or three countries launching frustrating and fruitless political negotiations and legal battles in an attempt to achieve sovereignty of a few miles of land here and there. The main drive behind this interest was what Daniel Yergin had labeled long ago as the “Prize”[2] in the form of energy security and economic strength coming from owning large hydrocarbon reserves.
This led to a further inquiry into the shortcomings of the current Law of the Sea. My first impressions of the “equidistance” delimitation methodology inherent with in the UNCLOS represented a cake cutting exercise which was simple and easy, and seemed fair until I discovered the inherently contradictory nature of the UNCLOS[3] drafting itself[4] which meant that the concept of the “Continental Shelf” as a natural prolongation was in direct conflict with the concept of a 200m long Exclusive Economic Zone (EEZ)[5]. It was also possible to discern from the pending ICJ disputes and the case law indicated quite simply, that the concept of applying “equitable principles to delimitation” had created quite a bit of an uncertainty for the parties hoping to find guidance with in the UNCLOS for their delimitation differences[6]. A perusal of the same suggested that the UNCLOS provisions had at times proved complicated and inadequate to deal with the unique geomorphic features of many jurisdictions. As a consequence of the same it was possible to observe that a very confusing body of ICJ jurisprudence[7] had now appeared, largely at odds with precedent as well as unhelpful for the prediction of a possible certain outcome of subsequent pending matters.
1.2 Reasons for choice of the East China Sea as a subject of study
Before delving into further discussion, the author would like to justify the reason behind choosing the East China Sea Dispute as means of assessing the effectiveness of International Law in bringing about legal certainty pertaining to the ownership of disputed reserves of hydrocarbon resources.
The first premise of such a choice was the fact that both parties (China and Japan) are equally powerful and influential state entities from a point of economics and international relations. This should go on to show that even in situations where the duress of economic pressure, war activities and political unrest may be minimal, Joint Development initiatives face clear danger of abandonment due to political differences and ugly nationalist egos[8].
Secondly the unique geomorphic features of the jurisdiction with in the East China Sea are a good illustration of how the UNCLOS ’s ‘one size fits all approach’[9] is largely unhelpful in securing a clear solution to a maritime delimitation dispute. The fact that both countries have since 1996 come up with their own interpretations pertaining to the UNCLOS based on this geomorphic confusion maybe one reason joint development agreements made now or before may subsequently become victims of ambiguity[10]. It has repeatedly been the complaint by both China and Japan that the UNCLOS was formulated with the Atlantic Ocean in mind and is fundamentally incompatible with the rather complicated topographic and geomorphic features of the East China Sea and the Pacific Ocean area[11].
Thirdly the confusion customary law creates in many delimitation disputes and its contradictions with UNCLOS and the relevant case law can also be better discerned from an examination of this recent and ongoing dispute, due to its unique historical origins and dealings prior to the point where UNCLOS came into effect[12]. It is also worth noting that the political atmosphere in North East Asia has from the perspective of international relations has always favored bilateralism. This view may contribute to the argument that China and Japan will fare better in bilaterally negotiated Joint Development ventures, than in multilateral peace process involving judicial arbitration.
1.3 A note on Methodology: Fact-finding and analytical approach
Every effort has been made to make this dissertation a fair and balanced effort which is not only research effective but also a clear reflection of the most up to date recent developments and their anticipated effect on the future of maritime delimitation disputes globally as well as in the context of the East China Sea. Clearly the author has premised her epistemological reasoning on a through application of legal possibilities to historical and political factors to better highlight the realities of the situation at hand. Furthermore Author has, to ensure that a variety of legal and political literature is utilized in addition to legal materials in the preparation of this dissertation, expedited prior to the type up, thorough search for material was made through online academic search Engines. These included the ones available through SFX, Scopus, Westlaw, Justis, Just-Cite, JSTOR and OGEL to name a few. Google Scholar and Google News was used to get the recent updates to the situation with in the East Chine Sea Dispute to ensure that the views expressed in the dissertation reflected the current and anticipated effects of the ongoing political situation in the East China Sea Dispute. Legal updates have been checked up to the 23rd of August 2010 via Lexis Nexis and Westlaw and Google News. Book and Journal resources have been duly acknowledged and the author has ensured that cross-referencing wherever utilized has been duly acknowledged with regard for the sanctity of academic originality, which we all firmly by, as dedicated scholars at the University of Aberdeen
1.4 Research Questions:
To further the end of effective and meaningful research with tangible conclusions the Author has formulated the following research questions
- Do the UNCLOS and Customary law have any answers for the territorial dilemmas posed by the East China Sea Dispute?
- Can the Law of Sea (UNCLOS) and/or Customary Law be of any help in the situation in the East China Sea Dispute in the event the dispute is taken to an International tribunal?
- What are the other options in terms of Joint Development that China and Japan have in the event International adjudication is not considered a good option?
- What are the political realities in the light of recent events post the 2008 principles consensus, which threaten the cause of Joint Development?
- If Joint Development has become a tool of delay and political arm-twisting is it time to revisit the option of having a more clear and precise international law? What kind of efforts will such an exercise entail and what will be the implications there of?
1.5 Some Geographical and Historical facts about the East China Sea Dispute:
The territory under dispute specifically with in the East China Sea[13] Dispute consists of the Senkaku Islands also known with in the Chinese language as the Diaoyu Islands can basically be described from a geographic point of view as a cluster of five volcanic islands along with what can be described as three large “rocks”[14] which are not suitable for human habitation (Please refer to the Map in Appendix 2). This cluster of disputed territory is located in the East China Sea[15]. The largest of these volcanic rocks and formations is known as the Uotsuri-jima which a size of almost 4.3 square kilometers. Despite the fact that they are uninhabited or unoccupied, they remain a contentious issue between China and Japan due to the rich deposits of natural gas below these formations. The dispute is based primarily upon the ownership of these minerals situated in the East China continental shelf for which the status of sovereignty of either states on the same will be decisive as who wins the energy security race in the region (Please refer to the map appended in the Appendix 2)
1.6 A chronological description of events till date
This section is an attempt at setting out a smallish chronology can be formulated to set out a brief but relevant record of the events until date. This is based on the observations of Valencia (2007) and Blanchard (2006)[16].
The “gold rush”[17] in the East China Sea region for claiming a fair share to the hidden “prize” beneath the waters began in 1968 when the United Nations reported the existence of potentially rich hydrocarbon reserves in this territory[18]. China and Japan were not the only claimants here as by 1970 many East Asian countries were asserting rights to these previously unimportant geographical formations[19]. China’s protests began in 1971[20] when US transferred these Islands to Japanese control in 1970, and in 1973-4 Japan and Korea were already signing bilateral joint agreements over joint development over the Okinawa Trough and the East China Basin[21].
In 1978[22] the then on-going peace treaty negotiations were disrupted by local nationalist protests in Japan[23]. China reacted for the first time by sending over a hundred half armed fishing ships into the disputed waters. The peace negotiations were later resumed with the hope of capturing the hydrocarbon bounties under the sea, evidence for which was still shady[24]. Strategically at this point China was also softening its stance to have Japan’s support in containing the Soviet Union as well as Taiwan. 1980 saw both countries make an effort to define a border for the East China Sea where the first seeds of the disagreement over the equidistance versus the natural prolongation principle surfaced and the negotiations failed. This did not however prevent China from making a physical assertion of its claims by drilling two exploratory wells which were later withdrawn and Japan was asked to participate in the joint development of the same[25].
Things remained quiet and peaceful until 1988 when a Japanese socialist group took up construction work on a previously built lighthouse on the Senkaku Islands. This was met with protests on China’s side and then in the year 1992 China promulgated a domestic law[26] while listing the Senkaku as its sovereign territory in anticipation of its upcoming ratification along with Japan[27] of the United Nations Convention on the Law of the Sea (UNCLOS) in 1996. At this point disputes were getting intense as in 1995 a Chinese state vessel began survey work around the Islands which was followed by Japan sending some defense aero planes in the region to warn off what it was believed to be Chinese patrol vessels. Much of this show of military strength and sovereignty that escalated around this time has been attributed by commentators[28] to the anticipation of the coming into effect of the UNCLOS as well as the heightened hype of rising oil and gas prices around the world. Such unrest caused by the rush to establish a “right” to the dispute territory was followed by reaffirmations over the Chinese claims over the Senkaku and repeated nationalist antics from both sides [29], especially by China to get rid of the Japanese lighthouses built on the Senkaku Islands. While progress was made during 1997 over securing joint development agreements over fishery disputes there was less good news about hydrocarbon research and navigation efforts to build an Oil field on behalf of China as viewed by the Japanese. After some political arm twisting in 2000[30] and building a religious shrine on these Islands, Japan was able to make China reconsider its aggressive policy of floating military vessels in the disputed waters. A mutual notification system was agreed and accordingly the “2001 Agreement” was signed between both parties excluding the mention of whether there was a definite median line sea boundary for navigation or exploration. The next year, 2002 saw the agreement getting flouted, as there was a row over Japan’s unannounced military efforts to salvage a North Korean ship that sank in the disputed waters. By 2003 nationalist sentiments had heated up again over the ownership of the Senkaku and Japans unilateralism in floating military vessels with in the disputed territories. China was making public affirmations of its sovereignty and entered into exploration agreements in the disputed territory with a consortium of local and Western firms.
The year 2004 saw a heightened military and naval proliferation and offensive launched by both sides to secure these areas. Furthermore Japanese requests to share navigation information as well as the data on its exploration activities were refused by China[31]. In 2005 there was talk of military offensives and countermeasures to any pre-emptive development attempts from both sides with in the disputed area and the Japanese government announced the occupation of the lighthouse and the registration of Japanese nationals on the island to prove occupation under the canons of International customary law. While there was news of peaceful negotiations until them nothing much was done. A similar lack of enthusiasm for peace was seen in the 2006 talks where as Japan and China seemed less than keen on any measure related to joint development. This period also saw China trying to make some allies in South East Asia and Japan becoming an active participant in the American East Asian Missile Defense System.
1.7 The 2008 Consensus and Beyond
By March 2007, China and Japans negotiations pertaining to the East China Sea had been resumed and after a few pleasantries were exchanged between the heads of both countries a huge diplomatic effort followed to make the disputed area what was dubbed as ““Sea of Peace, Cooperation, and Friendship,” to conduct joint development as a provisional arrangement until a final delimitation or boundary was agreed
The Principled Consensus came into being by June 18, 2008[32] and basically allowed Japan to invest in and be entitled to a portion of the profits from energy exploitation activities in disputed areas, which included the Chunxiao oil/gas field. The 2008 Agreement had quite a few flaws, which were obvious immediately and have been discussed in detail later in the paper. The terms of the agreement effectively showed that the Senkaku issue had been shelved and once again the definitions of the Continental Shelf and the EEZ in this area remained uncertain. Furthermore as will be seen in the section below the confusions have escalated recently by both parties making their own sense out of the terms of the Principled Consensus in terms of Joint Development steps[33]. So much so that even the area of allocation of profits between the two nations was not clarified.
While many authors[34] have attributed this toning down of attitudes to economic anxiety on both ends both parties, there is still a need to arrive at a legally certain and binding arrangement here for reasons discussed further below. However of late China’s policy to pre-empt exploration[35] without prior negotiations has recently begun to irritate Japan to the extent that it is now uncomfortable with going ahead with the 2008 Principled Accord[36]. The next chapter will now examine the application of customary law and the UNCLOS to this scenario from the viewpoint of the research questions raised in this Chapter.
Chapter 2
The Application of UNCLOS to the East China Sea Dispute
2.1 A short description of the Legal Disputes with in the Issue at hand
2.1.1 Sovereignty
In terms of international law pertaining to sovereignty it should be noted that apart from a few cases from international tribunals there is no set convention or treaty that explicitly states what determines sovereignty in a disputed maritime zone[37]. Some help can however be gleaned from Customary law where there is a recognition of a few methods of declaring sovereignty based on precedent from international tribunals. These can be branded as being based on discovery (followed by occupation), cession, prescription, conquest and accretion[38]. In the China-Japan scenario discovery, occupation and prescription have all been pleaded and used evident from the chronological discussion of events in Chapter One of this paper.
Based on the above the nature of these disputes can at best be labeled as “multifaceted”, the first issue being that of sovereignty. In this regard China’s claim to the region dates back to 1372 and is based on its approach/discovery upon the island for fishing and herbal extraction[39]. However since there is no evidence of effective administrative control over these Islands by China, Japan believes that its administration over these areas between the years 1895 to 1971 is a solid impetus for its sovereignty under international customary law[40]. This administration is accused by China of being illegal and its contention is that the ownership of the same was returned to the Chinese under the Peace Treaty[41] concluded between Japan and the USA.
Japan claims sovereignty over the islands premised on occupation and discovery, effective exercise of sovereignty, and the factum of Chinese acquiescence (atleast prior to 1971) based on the lengthy Japanese administration of these Islands. Based on these alone China’s mere use of the same as navigational points or fishing areas (See Chapter 1) may be defeated by Japanese hold on the Islands[42]. However a lack of acquiescence on the part of China is obvious since 1971 [43]and China would very much like to have these historical contexts of its claims taken into account should the case be taken to the ICJ[44].
A lot of confusion emerges here if the situation is reviewed under customary international law. While Japan argues that it had sufficient administrative control of the Islands for considerable time [45], the same has been propagated as an “illegal” conquest by the Chinese, which should make it illegal under the relevant international law. Another controversy has often been whether the 1895 Shimonoseki Treaty, which brought peace after the Chinese and Japanese war, actually vested the ownership of this fringe-based, island like geographical formations to China[46]. However Japan’s stance here is simply that the Senkaku Islands have not been mentioned in both agreements and are thus not a part of the “handing over” or vesting as a consequence of peace arrangements[47]. In addition to the above Japan’s legal claim is possibly strengthened by the fact that post the World War II the Senkaku Islands have been under the administrative control of the United States of America and were a part of the territory given back to Japan in 1971[48].
2.1.2 The legal entitlement to the continental shelf and delimitation of the maritime boundaries under the UNCLOS
This aspect arises from the legal status /sovereignty of these Islands based on the rights provided to a country over its Continental shelf and Exclusive Economic Zone[49]. The area between the China and Japan, also known as the Asian continental shelf is actually hundreds of meters long and lasts through the East China Sea to the Okinawa Trough.[50] The Senkaku Islands, which form the focal point of the Sino Japanese Dispute, are actually situated in this area (basically towards the west of the Okinawa Trough). Therefore under the rules provided in the UNCLOS China can easily claim a sizeable portion of the Continental Shelf. However once these rules are actually applied the right of Japan to a 200 mile (nautical mile) Exclusive Economic Zone which can actually be said to be extending west of the Ryukyu Islands. From the facts it would seem that both claims could arguably be valid as they belong to the two different “natural prolongation” and “equidistance” methodologies[51].
The UNCLOS delimitation methodology is set out in (see Arts. 3-16). In this regards the following should be noted that under Article 5 the “normal baseline…is the low-water line along the coast” which means that a state’s default maritime borders will be chalked out based on its low-tide parameters and this baseline will be used to chart the EEZ of the respective countries under Arts. 55-58[52].
On a technical note the Chinese opposition to the Japanese claim of demarcation is based on the assertion that the Chunxiao gas field does not cross the median in any case and remains 4 kms away from the Japanese claimed demarcation[53]. Furthermore China also claims on the basis of the natural prolongation principle a 350nm long continental shelf under the provisions of the UNCLOS.It is possible to discern from maps and diagrams of the disputed territory that the East Chinese sea is divided into two areas of dispute. One can be called the East China Sea Basin and another can be called the Okinawa Trough[54]. Technically if China is able claim the waters up to the Okinawa Trough, it would become much easier for China to lay title to practically the entire East Chinese Sea[55]. For the purposes of this paper the focus remain the Senkaku Islands As a counter argument the Japanese believe that they may have a claim to a share of Chunxiao’s profits and any other benefits because extraction draws upon resources currently located east of the dispute demarcation.[56]
Therefore since the Japanese EEZ actually overlaps with the Chinese continental shelf, Japans delimitation claim to has been based on the principle of Equidistance as it can be applied upon the Ryukyu Islands and the Asian mainland region. The problem that arises here from the application of the UNCLOS is that Japan’s claim to its EEZ overlaps with the Chinese claim to its continental shelf and this puts the ownership of the Senkaku Island Gas deposits into a direct confusion. For this reason the author has, in the paragraphs below discussed in detail the problems UNCLOS presents with its failure to deal with such paradoxical situations where the lacunas in the UNCLOS are revealed as being a failure to deal with such situations arising from the unique geomorphic features of disputed maritime territories. Things get even more difficult when it is difficult to determine the legal status of geographic formations or rocks, which are “inhabitable”[57].
2.1.3 Status of inhabitable rocks
The reason the unconditional and absolute ownership of the Senkaku Islands[58] is extremely important to either state parties is also based on the wording of the UNCLOS.Technically whoever gets rights to the Senkaku Islands also gets to have the rights to the continental shelf and EEZ zones around these Islands[59]. Furthermore even if these formations are not viewed as Islands but uninhabitable rocks even then the territorial sea around them of 12 nautical miles can be claimed by either party[60]. This would also entail that only the Senkaku Islands could claim a continental shelf and this would go in the favor of the Japanese claims allowing Japan to gain sizeable maritime rights which would be potentially independent of China’s Maritime Claims as a coastal state
It can be discerned from the discussion above that China and Japan a UNCLOS[61] solution has been found very much undesirable due to the apparent confusion created by its ambiguity. Under the UNCLOS a State Party is entitled to an Exclusive Economic Zone over to a sea to a distance 200 nautical miles (nm) from coastal baselines (UNCLOS Arts. 57 and 121) or to a natural prolongation of its dry territory to towards the outer edge of the continental margin up to a distance of 350 nautical miles under Article 76 UNCLOS. The problem lies inherently with in the geography of the East China Sea which is only 360 mm across at its widest which confuses the role of the UNCLOS in this scenario thus splitting the whole claim into opposite claims from China and Japan both of which seem valid with in the UNCLOS application[62].
2.2 Perceived failure of the UNCLOS and reasons thereof
It has often been observed by commentators that the 1982 UNCLOS is much more ambiguous than its predecessor, the 1958[63] Geneva Convention on the Continental Shelf. Interesting this predecessor convention was already effective while the East China Sea Dispute was emerging. The 1958 Continental Shelf Convention provided that “in the absence of agreement… the boundary shall be determined by application of the principle of equidistance…[64] “. However when looking at the UNLCOS wording and the relevant case law[65] it is easy to see that here the court is allowed to take into account all sorts of non-geographic factors in settling delimitation disputes even though geographical delimitation based on equidistance alone remains “step one” of the whole delimitation exercise[66]. ICJ Jurisprudence is evident of the fact that it is the most popular method with “other” factors being secondary considerations[67]. Nevertheless it is interesting to note that whichever party wins the outcome of the application of the “Equidistance” rule will be able to control over 19,800 square nautical miles of sea and seabed in and around the Okinawa trough[68].
In terms of the ensuing confusion that has been created in the East China Sea dispute One author has stated that the role of UNCLOS and customary law has been that of “…perpetuating the stalemate over the Senkaku islands for other sovereignty and resource disputes”[69], instead of being of any genuine help towards a certain solution. Despite such views all is not lost, as some academics have expressed their support for the Chinese claim to the continental shelf based on the support for the “equitable principles” and the natural prolongation with in the ICJ jurisprudence and Customary International law[70].
At the inception of the UNCLOS, it was envisaged that there would be much possible disagreement over the methodology of delimitation in being based on “equitable principles” or “median line” group at variance with each other, and thus a compromise was made accordingly with in the UNCLOS in general terms that “the delimitation of the continental shelf between States with adjacent or opposite coasts shall be effected by agreement on the basis of international law, as referred to in Article 38 of the Statute of the International Court of Justice, in order to achieve an equitable solution”[71].Whether or not this can be interpreted as a legal impetus for promoting Joint Development and a legal solution based on equitable principles can be seen in next paragraph.
This observation draws heavy support from the 1969 North Sea continental shelf cases which support China’s right to its Continental Shelf as its “ipso facto and ab initio,” inherent right which does not rely on any special legal actions but simply on the factum of “natural prolongation”. This is supported by the text of Art 76 UNCLOS and subsequent case law like the 1985 Guinea-Guinea-Bissau Maritime Delimitation Case, where International Arbitration Tribunal maintained that the equidistance distance criterion cannot be viewed in isolation from the equitable principles criteria. Commentators have even gone ahead to say that if this line of reasoning is to be followed then it becomes clear that Japan’s sole reliance on the equidistance principle loses its legal basis in the UNCLOS as well as the backing of the spirit of International law. Furthermore Japan’s acts in propagating a median line are also said to be in contravention of Article 83 UNCLOS which points towards “agreement” in drawing such boundaries. Therefore allegedly Japan’s propagation could be said to amount to unilateralism until it is either accepted by China or by a third party deciding the case. It can also be gathered from other ICJ precedents relevant to maritime delimitation that the courts will avoid the use of the equidistance principle as a cake cutting exercise, done without giving due considerations to the principles of equity[72].
Andrew Serdy[73] has written an informative article about the current type of scenarios and states thus, “two States are separated by less than 400 miles of water and the configuration of the seabed is such that one of those States does, but the other does not, have an entitlement under the rules of paragraphs 4 to 7 of Article 76 to a continental shelf extending more than 200 nautical miles from the baselines from which the breadth of the territorial sea is measured”.[74] According to him there are only two known global delimitation disputes that fit this anomalous description, one is the dispute between Australia and Timor-Liste[75] and the other is the East China Sea Dispute[76]. Based on the outcome of the Timor-Leste case Serdy has supported China’s case for claiming the Okinawa trough as a natural prolongation of the continental shelf which can based on the ICJ jurisprudence pertaining to the application of equitable principles, possibly defeat the Japanese claim should the case go for adjudication[77].
However this is only one side of the story and can at best be put up as wishful thinking on behalf of China[78]. Based on these problems identified with the application of the UNCLOS and customary law to the East China delimitation conundrum, the author will explore in the next chapter whether Joint Development can afford a better solution to this dispute.
In any case if the East China Dispute goes to court in the event of both parties being unable to reach a conclusion to this dispute, the dispute can be submitted to one of the international dispute forums like International Court of the Law of the Sea, the International Court of Justice (ICJ), the Arbitration Tribunal or the Special Tribunal of Arbitral. The problem here remains the delay factor and the decline in economic efficiency, which can damage the hydrocarbon potential of the region and also threaten foreign investment in the area. It is worth noting, especially in the case of the ICJ that it has more disputes pending than it has resolved in this matter and there is very little similar precedent here except the Timor-Leste case.[79]. This has caused a lot of reluctance on many state parties to pursue this course and likewise successful Joint Development has ensued in many global maritime disputes.
Keeping in mind the recent developments discussed later in the paper, with nationalist sentiments running high and the problems being faced by the ambiguity of the 2008 Principled Consensus it can now be predicted that China and Japan might have to ultimately rely on a proper judicial settlement for their unique delimitation conundrum. It should be noted nevertheless that it is a long and risk road to litigation. Sometimes even the courts are reluctant to hand out definite verdicts in extremely political sensitive situations fearing a volatile reaction from the losing parties. The outcome of the Nigeria and Cameroon case [80] is a good example of how a losing party can be embittered enough to reject the verdict and question the credibility of a tribunal in embarrassing ways.
Chapter 3
Joint Development in the East China Sea
3.1 The Legal basis of Joint Development in the UNCLOS
It can be well observed from academic writings and was briefly discussed in the last chapter that the UN Convention on the Law of the Sea expressly provides for and points to the use of agreement and dialogue for the settlement of deadlocks encountered by parties[81]. In any case a “stalemate”[82] situation is not in the interests of either parties or the security and stability of North East Asia[83]. One option, which has already been taken up in the form of the 2008 Principled Consensus, has been to consider joint development of the area, which as briefly discussed in Chapter 1, is facing difficulties due to its “transitory” and “vague” nature. This matter will be further taken up down below in the discussion regarding the legality of the Principled Consensus as a joint development arrangement. As has been put forth by many commentators the 2008 Principled Accord finds its basis[84] in paragraph 3 of Article 83 UNCLOS where in terms of states facing a dispute pertaining to “delimitation of the continental shelf between States with adjacent or opposite coasts” should, “ in a spirit of understanding and cooperation, … make effort to enter into provisional arrangements of a practical nature and during this transitional period, not to jeopardize or hamper the reaching of the final agreement. Such arrangements shall be without prejudice to the final delimitation.[85]” Historically such arrangements have worked out in practice by the setting up of Joint Development Zones[86] and dividing then further into smaller zones in terms of the application of legal regimes and exploration and development mechanisms.
Joint Development has been defined by Miyoshi (1998) as “[a] n inter-governmental arrangement of a provisional nature, designed for functional purposes of joint exploration for and/or exploitation of hydrocarbon resources of the sea-bed beyond the territorial sea[87].” Recently this term has been academically acknowledged to apply to unitization agreements between states to share petroleum deposits in joint or overlapping maritime zones[88]. Another term for the same is “transboundary deposits”[89] which has been used when referring to Joint Development and “unitization” agreements relating to the same[90].
In terms of commenting upon the joint development situation and the extent to which such agreements do or should bind China and Japan the starting point would be to review the latest Sino-Japanese arrangement in June 2008.Where as the history of Sino-Japanese negotiations prior to this 2008 Joint Development arrangement has been reviewed above, this section focuses solely on how the current Sino Japanese politics has proved so far to be unconducive to the entire idea of a solid joint development agreement. One of the reasons has inevitably been the alleged lack of a legal basis of the 2008 Principled Accord. Many academics have however suggested that it should be treated and respected as a treaty in order to ensure the health and wealth of the peace process[91]. There is however a dissenting view which rules out any solid legal standing of the document and thus realizing that the 2008 has a shaky foundation[92].
3.2 The 2008 Principled[93] Consensus Accord
The June 18, 2008[94] Principled Consensus consisted of China and Japan agreeing that the two sides would conduct themselves peacefully and cooperate in the matters of development and exploration of natural resources unless they reach a conclusion as to their respective entitlements to the maritime zones around their coastlines[95]. It was agreed that China and Japan would develop the 2700 km area of the disputed waters with in the East China Sea which straddle the proposed median line of Japan and that the Japanese companies would invest in a Chinese administered hydrocarbon field which lay close to that area of the median which was close to the territory being claimed by the Chinese[96]. Even subsequent to this agreement there was confusion as to whether investment in fields could be deemed as “Joint Development”[97]. However shortly after this understanding the new elected Japanese administration began to pose problems due to its anti-Chinese, nationalist philosophies[98]. Announcements began to surface now that Japan would be opposed to any exploration activities by China in the disputed waters and would not support any action in the name of joint development in this area. Such an opposition has even been reiterated very recently [99].
A number of important things should be noted about this arrangement. A closer analysis and subsequent interpretations of the same bring about the conclusion that “joint development” and “capital participation” has been dealt differently with in this understanding and has been left to bilateral arrangements to be concluded later[100]. Such an amount of flexibility can be deemed by some as dangerous leaving the agreement open to disputed misinterpretations later on which are infact beginning to rise now.[101] Secondly since the Japanese private companies will be coming in to join in with the Chinese companies the applicable law of the same has been deemed to be the Chinese domestic law in the form of Regulations on the Exploitation of Offshore Petroleum Resources in Cooperation with Foreign Enterprises (Regulations) which accord the national Chinese oil company the responsibility for exploiting offshore petroleum resources and dealing with the foreign companies in terms of profit sharing and bidding. One of the likely bones of contention as pointed out by Jianjun Gao (2009) is the expropriation policy as set out with in the accord. It states, “Under special circumstances, China may, in accordance with the needs of the social public interest, expropriate part or all of the petroleum due to the foreign enterprises in the cooperative exploitation in accordance with the legal procedures and provide compensation accordingly.[102]”This is clearly something Japan or other foreign companies are unlikely to be satisfied with. This has led many commentators to say this can hardly be called a Joint Development arrangement at least in the case of the participation of Japanese corporations in the Chunxiao oil field[103].
3.3 The two differing views over the legality/legal standing of the consensus
The first suggestion comes from Peterson (2009)[104] who has argued that the 2008 Consensus is more of an informal arrangement because there is not certain document, which has been signed or ratified according to the Vienna Convention on the Law of Treaties, adopted in 1969. The 2008 Principled Consensus simply states that, “The governments of China and Japan have confirmed this [principled consensus on cooperation], and will work to reach agreement on the exchange of notes as necessary and exchange them at an early date. The two sides will fulfill their respective domestic procedures as required.[105] “However there is evidence from Customary Law practices as argued by Jianjun (2009) that given that such agreements were intended to be treated as such, they should infact be treated as treaties. But given that this line of reasoning is adopted Peterson (2009) argues that in essence as its name states the understanding remains a “principled consensus” and as such cannot be interpreted as an informal binding legal instrument. This is also evident from its inherent transitory nature as it was meant to keep peace and promote joint development until a conclusion can be reached on the dispute. Support for this view can be drawn from the works of Ong[106] who has given some profound insights into how the widespread ratification of the UNCLOS caused a renewed interest on how shared petroleum deposits and marine resources should be utilized. However after much analysis he was able to conclude that while Joint Development is a desirable alternative to litigation, there is no compulsion or premise in customary international law pointing to the joint development of common offshore oil and gas deposits[107].
During the talks for the 2008 Consensus a statement was made by Chinese Foreign Minister that, “the principled consensus reached by China and Japan on joint development is a transitional measure, or a temporary arrangement, clarified this at the Press Conference that followed. It will not affect China’s sovereign rights and jurisdiction over the East China Sea.” [108] Commenting on this Peterson (2009) also notes that even though the political declarations made by the dignitaries of both sides can be interpreted as declarations of intent most of them being made separately and not confirmed were largely unilateral and as it can be seen from the text of the Press Conference China has not confirmed or denied any of these on its own.
Furthermore if the argument that this is infact a Treaty is to be taken up at face value there is a risk that there will an interpretation that it has no termination clause. If the given termination point is when “delimitation” occurs then there has to be a clear definition of whatever that can entail. Finally Peterson (2009) has continued his rather pessimistic interpretation by stating that there is no duty to “jointly develop” in the UNCLOS.What is required merely until conclusion is reached is efforts and provisional arrangements to aid cooperation in the administration of that area. A similar view has been expressed from the point of view of whether Customary law supports joint development and the possibility has been ruled out. The only thing that supports the stay and health of this consensus is perhaps the party’s eagerness at that point in 2008 to make way for peace around the 2008 Chinese Olympics and perhaps other economic advantages.
The other side of the argument is then explained by Jianjin (2009) who states that the 2008 Accord should be interpreted as a treaty as it was a result of three and half years of negotiations and almost eleven rounds of talks. Very serious and significant things have been said in the Accord, Jianjin (2009) notes when he says that, “the provisions about joint development in the northern part of the East China Sea and the capital participation by Japanese corporations in the development of the Chunxiao field, as well as the agreement that the cooperation is not to prejudice their respective legal positions, cannot be taken to be just a “consensual subsequent practice of the parties.”[109] In addition to this Jianjin has also pointed out that how can a document where such undertakings are made be interpreted as something non-treaty like. There is definitely every obligation to create a legal obligation here. The nature of these obligations can be seen from undertakings with in the 2008 Accord, which state that, “ each side is to refrain from taking unilateral actions in the block area defined for joint development. China is obligated to permit Japanese corporations to participate in the development of the Chunxiao field. No side is to interpret the Consensus in such a way as to prejudice the legal position on maritime delimitation of the other.”[110]
Based on this reasoning there is every reason to regard the 2008 Accord and its joint development understandings as legally binding principled and framework document which cannot and should not be flouted.
Weighing the options of Joint Development against the UNCLOS: academic opinion
Despite the exhaustive review of the “legal basis” of the 2008 Accord undertaken above, the legal and political realities as in 2010 might tell a different story. In fact any political benefits that are hoped to arise from the phenomena of Joint Development have often become rhetoric in the face of changing governments and new leaders with new political agendas refusing to stand by their promises. This has led many to query whether a joint development will actually bring an end to the constant political arm twisting which has become characteristic if the Sino-Japanese relations. A sovereignty agreement, perhaps, which could settle claims coming from both jurisdictions once and for all, has been one suggestion. Such an arrangement could weigh the strength of each party’s claims wherever such an overlap remains and unitization could follow based on the relevant costs. At the same time an overseeing authority, something in the nature of a Bilateral Development Authority could oversee the administration of these geographic locations. However till date the idea of information sharing in terms of the hydrocarbon potential of the disputed area has been rejected by China, particularly recently[111]. Even though such a co-operation could actually set a great example for joint development and unitization around the world, much is being said and done now which, as will be seen during the rest of the paper and the concluding chapters, has the potential of turning this dispute into an ugly, labyrinth like situation. The section below examines various options that the China and Japan have now and the impetus there of in the views of various recent legal and political commentators.
According to Pan J.[112], the deadlock between China and Japan countries can best be resolved through a third party framework which can be based under the settlement system inherent with in the UNCLOS.[113]The support for such an impetus also lies in the ICJ case law (particularly in the North Sea cases where the case was referred compulsory mediation between the parties) and previous political precedent and state practice in the East China Sea region. Based on this one option that combines the UNCLOS and negotiation option is the use of Commission on the Limits of the Continental Shelf (CLCS). This view is also supported by Sheng-Ti[114] who believes that utilizing the provision of the UNCLOS for contacting Commission on the Limits of the Continental Shelf (CLCS), which was established in 1997 in accordance with Article 76 UNCLOS would give China and Japan a good chance to have their case decided upon technical grounds in this case as CLCS has the mandate to consider data submitted by coastal states concerning the outer limits of their continental shelf in areas where those limits extend beyond 200 nautical miles[115]. The body only makes recommendations but despite its ability to positively facilitate the implementation of the UNCLO, the East China Sea dispute parties have avoided its use. One of the reasons for this can be that whatever is ruled or recommended by this commission, can have serious consequences on third parties involved in the maritime dispute[116]. This is true to the extent that East China Sea is ripe with multiple claims and dispute with atleast 5 other countries trying to get China to come to resolve their boundary disputes with them in the region in addition to Russian and American expectations to contain China before it becomes a prominent threat to their superpower status[117].
Yang et al.,[118] have taken the position that while this dispute persists other countries which are involved in the dispute indirectly like Korea and Taiwan will also lag behind in their energy development initiatives and thus the Sino-Japanese dispute is fast becoming a matter of international concern[119]. Thus if China has to stay strong on its position of its refusal to enter arbitration or submit itself to the rules and procedures under the UNCLOS it should try and establish a “strategy of negotiation based on analyses of resource distributional conditions and other strategic factors in the delimitation area”[120].
According to Liao [121] this dispute has to be viewed through the lens of an intensified competition between China and Japan over energy supply. Therefore any joint development agreement will then have to follow a stable series of diplomatic dialogues to avoid the key obstacles of nationalism and the tendency for political arm-twisting by both energy hungry parties.[122]
For Okafor [123] the desired end of actually achieving delimitation in a maritime jurisdiction is basically more of a “cake-cutting”[124] exercise. Although discussed in the context of the Nigeria-Cameroon dispute this paper has profound and far-reaching perspectives for the East China Sea dispute. For Okafor the constantly fugacious and migratory in nature of petroleum reserves simply means that they do not respect boundaries. If such reserves have to be successfully captured and efficiently exploited then it is necessary to make way for Joint Development measures.
The most important thing to note here is that the East China Sea Dispute cannot be viewed in isolation from the interests of third parties here. It is also a significant factum that US is a key Japanese Ally. Yu, P. [125]has noted that the Sino-Japanese relations are of pivotal importance for the American government. The US is and should be anxious to have better relations with the Japanese Government at all, while at the same time preserving its natural opposition the growing Chinese influence in the region. As mentioned elsewhere in this paper it is possible to note quite clearly that the US is itself not a signatory to the UNCLOS.What complicates its position viz a viz the scenario where it would like to take direct action with in the UN against China to compel it to surrender the dispute to the ICJ [126]. Therefore it has to rely upon good relations with China’s adversaries in the South China and East China Sea dispute and contain China’s growing power through diplomatic dialogue.
Itoh [127] has also suggested that if Sino-Japanese relations must be improved they must be done so with the conscious knowledge that Russia and the US have quite a few proactive interests in this region and the whole matter will become an issue of multilateral politics to bring about and preserve energy security. It is not surprising that the common business and geographical co-operation between China and Japan may be viewed as a threat by Russia and the US and therefore the leadership will have to rethink its political approach towards each other if only to preserve the region from a heightened opportunistic Western influence[128].
The observations above merit the consideration of a more bilateral and politically friendly hydrocarbon joint development arrangement between these two jurisdictions to bypass the problems created by the apparent legal uncertainty created by the application of International law. Examples of the arrangements can be seen from examples of the North Sea between Britain and Norway (The Frigg Agreement). The merits and rewards of such an arrangement are high and indeed a practical solution to the resolution of such disputes. But even though this inter-country unitization might have its “theoretical” advantages of efficient hydrocarbon exploitation and the economically efficient allocation of costs and benefits between the stakeholders. Infact the Joint development model advocated most frequently by modern academics and economists is the Unitization method where costs and benefits of exploration and production are shared equally through co-operative exploration and environmental concern. At the micro-level (especially where deposits are in a mixed ownership/licensed peace of private land) Unitization has proved to be a successful and economically efficient means of development. However in a world tainted by political agendas and a desire for regional domination, recent events have in all practicality shaken the foundation upon which such a good will arrangement has been proposed in the past. This is evident from the disturbing turn Sino-Japanese relations seem to be taking in the past few weeks.
Based on the political and regional issues which can possibly influence the Sino-Japanese bilateral ties in terms of hydrocarbon joint development the author will in the next chapter review some recent developments and reflect upon some conclusions.
_______________________________________________________________________
Chapter 4
Conclusion and a note on recent developments
It has been observed from the discussions in the chapters above that at this point China and Japan’s best options would be to try and seriously consider efforts to uphold the 2008 Principled Accord as a means of maintaining status quo in their future Joint Development efforts. The North Sea Continental Cases (1969) are a perfect example of how years of litigation led to the ICJ ruling in the favor of a negotiation process between the two parties. Most commentators have often dubbed this as a possible diplomatic failure to communicate if the result of litigation is expected to become the outcome of a zero-sum game. This is something China and Japan being two of the most powerful states in the North East region should avoid.
4.1 A comment on the recent developments in the East China Sea during 2010
Recent developments in 2010 have revealed a disturbing trend as far as the joint development potential of hydrocarbon in the East China Sea is concerned. Earlier this year as at February 2010 Japan was already expressing a desire to take its dispute with China in this region to an International maritime tribunal[129]. This is of course a threat to China’s long standing dominant position with in the region, which was very much highlighted by Hilary Clinton’s recent visit to the region where China took much offense to a possible American involvement in securing an end to the ongoing East China Sea conflict[130].
However it can also be said that China’s pre-emptive policy of producing gas with in disputed territories like its recent decision to continue extraction work over the disputed Chunxiao Gas Field can prove unconducive to the stay of the 2008 Consensus. This is a surprising development as the wording of the 2008 Principled Consensus in the East China Sea made it clear that both China and Japan would be able to share these maritime resources while leaving undecided the critical issues of the precise demarcation of the maritime boundary. One view has been that this accord was a hasted effort by the Chinese as they had already began drilling over the Chunxiao. Recently Japan has had issues with Chinese exploration work, which it accuses to be in crass and unilateral. It was announced by the Japanese administration[131] in January 2010 that Japan would oppose any effort by China to unilaterally explore the Chunxiao field. China has responded to this recently by stating that Japan was welcome to participate in this development. It seems that at this point Japan would like to see its claim of sovereignty determined for once and for all rather than merely share the financial proceeds of an oil rich disputed area with an old war enemy. Thus 2010 seems to be a point where a relatively quiet period devoid of political tensions between both countries has now come to an end placing doubts as to the validity and durability of joint development agreements or understandings.
Later on in the year, by August the 17th 2010[132] it was being seen that China was offering to diffuse some of this invisible tension by proposing the setting up of a maritime emergency hotline with Japan to prevent future diplomatic and defense related indiscretions until a definite agreement is reached over the ownership of the disputed territories. Many have viewed this as a subtle Chinese strategy after the recent Clinton visit to underplay the impetus Japan might have to restore its Pro-US Policy in order to counter the increasing Chinese dominance in the maritime zones. Infact the recent turn by Japan towards more assertiveness is all set to be instrumental in the establishment of the controversial US Futenma Air Base[133].
Another news report dated the 19th of August[134] depicts much concern on behalf of the USA on the military build up of China. The report also shows an increasingly “irritated” Beijing dismissing such reports as being in-conducive to good Sino-US relations while defending its aggressive military policy with out however actively aiding and abetting regional military confrontations. Japan which is a key US ally in the East Asian region has made a particularly disturbing statement here and has stressed while basing its support upon the Japan-US security treaty of Mutual Cooperation and Security that it will respond “collectively” to any aggression in the matter of the disputed territory.
Things are even worse in terms of a looming political disaster in the South China Sea (which has been due to its immense strategic importance dubbed the “second Persian Gulf”[135] and the “Asian Mediterranean”[136] which involves similar serious claims of delimitation between China, Taiwan, the Philippines, Brunei, Vietnam, and Malaysia who all claim sovereignty over all or part of the South China Sea.
At this point little seems to be coming from the 2002 Chinese commitment at the ASEAN forum where it was declared that there would be a peaceful resolution of disputes, particularly involving International Arbitration tribunals. However no such arbitration effort has yet been made by China. The trend of reconciliation and international arbitration has not found much popularity with this Oriental giant and it has kept its peace dealings bilateral hoping to use its “size” as an influence over small and economically weak neighbors. This approach is reflected by its latest and hostile rejection to Senator’s Clinton’s call for multilateral arbitration in the region [137]. The fact remains however that due to the number of parties involved in this dispute and China’s actions in committing itself to the 2002 ASEAN declaration, these disputes will sooner or later and for better or for worse take a more international nature. China’s hardline approach to the South and East China Sea is often criticized as contrary to international law as it freely asserts its rights to regulate the identity of the parties allowed to navigate and gather sensitive geophysical information from what its calls its own EEZ sea in these disputed waters. In addition to the above even after the 2008 accord, which was a part of the 2002 ASEAN forum commitments, China has been accused of pursing an aggressive military policy of causing grave problems for foreign naval forces [138].
4.2 Towards some conclusions based on the Paper and the recent developments
The road ahead is difficult to predict. Recent weeks have seen a hot and cold series of statements between the two countries. Where as on one hand Senator Hilary was told in no uncertain terms that US should take its diplomatic interference elsewhere, at the same time we saw China propose the establishment of a maritime hotline with Japan for tackling any kind of emergencies which could lead to a full military combat. Interestingly the US is not even a signatory of the UNCLOS itself and this is causing major problems for Japan and the US in bringing China about to a position where China’s “illegal” claims can be challenged and defeated in an international tribunal.
It is possible to see that the Chinese strategy has often been akin to what the author would like to call the concept of quasi-adverse possession by laying claim to territory through pre-emptive natural resource exploration projects as in the case of Chunxiao Gas Field. Such a view might arguably find some support in Customary international law as discussed before the legality and justifiability of the same in a new civilized world order, is likely to become questionable once adjudication starts in a Maritime Tribunal. In addition to the above if its military exercises and increasing aggressive patrol of the disputed territories in the East and South China is called in question, it is very likely to be found in blatant contravention of the UNCLOS.
What is being seen now is that rhetorical threats of litigation and aggression being delivered in vain from both sides might actually lead to proper adjudication of the dispute leading to a re-clarification of these boundaries definitely. The only conclusion that can be gathered from the observations above is that the current global will dictate in a lot of ways the fate of these delimitation disputes and joint development agreements are addressed and upheld.
Finally, if we revisit the research questions formulated earlier in this paper in Chapter I, it has been seenthat the Law of the Sea was developed as an effort to resolve such disputes fairly and peacefully, but its practical implementation has been less than conducive to global economic growth due to its rather vague application. It has also been seen abundantly elsewhere in this paper that despite the good intentions with which the UNCLOS was drawn up in 1982, many ongoing delimitation disputes like the East-China Sea dispute have only demonstrated its inadequacy as a one-stop panacea for the resolution of International Maritime Delimitation Disputes. This is because two of its most fundamental principles find themselves contradicting each other more often than not. These are A) the right of a country to have a natural prolongation of continental shelf, and B) the right of a country to have an exclusive economic zone (EEZ) .The dispute at hand is a reminder of how such contradictions and ambiguities in definitions can potentially cause legal and technological deadlocks between neighboring states already struggling with diplomatic niceties in maintaining Joint Development agreements. While has been possible to see from the recent developments that while much has been touted academically about the virtues of Joint Development as the ultimate panacea for bringing peace to regions harboring bitter enemies of yesteryears, the recent years in North East Asian politics have been an evidence of this being far from the truth.
The author of this dissertation does feel however, like many other lawyers and academics of this generation, disillusioned with the myth of achieving regional co-operation through Joint Development, without help from a solid and more transparent law of the sea. This is because it has been observed from the case of the East China Sea Dispute that as more selfish economic interests emerge in politically tense atmospheres, Joint Development stands a faint chance in the wake of leaders calling such negotiations “transitory”[139]. This can be utilized as a negative tool of stopgap measures to further delay development in the disputed areas rather than letting international law bring about an amicable measure. However the current state of the law of the sea calls for more clarity over the same, as it was perhaps not drafted with the unique geographical considerations each delimitation dispute brings in, perhaps not envisaged by the original. The critics of the 2008 accord between the Sino Japanese counterparts were not mere prophets of Doom when they predicted that somewhere along the peaceful “Seas of Co-operation” would surface the much awaited streak of blood and ugly nationalist sentiments tainted by deep rooted economic interests[140]. Based on the above the author believes that as at now before making any further provisions for Joint Development, Japan and China will have to realize that negotiation and conduction of the same will never become a zero-sum game and will have to be based more up on political compromise and co-operation for their success and less upon their legal validity.
Appendices
Appendix 1 “The 2008 Consensus” reproduced in its Original Form as published on the Chinese Embassy Website.
Press Release, Ministry of Foreign Affairs of the People’s Republic of China, China and Japan Reach Principled Consensus on East China Sea Issue (June 18, 2008), https://www.fmprc.gov.cn/eng/xwfw/s2510/2535/t466632.htm [hereinafter Principled Consensus].
Also available from the Chinese Embassy Website https://www.chinaembassy.org.nz/eng/xw/t466729.htm
China-Japan Principled Consensus on the East China Sea Issue 18 June 2008
Foreign Ministry Spokesperson Jiang Yu announced on June 18 that China and Japan reached a principled consensus on the East China Sea issue through consultation on equal footing.
I. Cooperation Between China and Japan in the East China Sea
In order to make the East China Sea, of which the delimitation between China and Japan is yet to be made, a “sea of peace, cooperation and friendship,” China and Japan have, in keeping with the common understanding reached by leaders of the two countries in April 2007 and their new common understanding reached in December 2007, agreed through serious consultations that the two sides will conduct cooperation in the transitional period prior to delimitation without prejudicing their respective legal positions. The two sides have taken the first step to this end and will continue to conduct consultations in the future.
II. Understanding Between China and Japan on Joint Development of the East China Sea
As the first step in the joint development of the East China Sea between China and Japan, the two sides will work on the following:
(a) The block for joint development shall be the area that is bounded by straight lines joining the following points in the order listed:
1. Latitude 29◦31′ North, longitude 125◦53′30′′ East 2. Latitude 29◦49′ North, longitude 125◦53′30′′ East 3. Latitude 30◦04′ North, longitude 126◦03′45′′ East 4. Latitude 30◦00′ North, longitude 126◦10′23′′ East 5. Latitude 30◦00′ North, longitude 126◦20′00′′ East 6. Latitude 29◦55′ North, longitude 126◦26′00′′ East 7. Latitude 29◦31′ North, longitude 126◦26′00′′ East
(b) The two sides will, through joint exploration, select by mutual agreement areas for joint development in the above-mentioned block under the principle of mutual benefit. The two sides through consultations will decide specific matters.
(c) To carry out the above-mentioned joint development, the two sides will work to fulfill their respective domestic procedures and arrive at the necessary bilateral agreement at an early date.
(d) The two sides have agreed to continue consultations for the early realization of joint development in other parts of the East China Sea.
III. Understanding on the Participation of Japanese Legal Person in the Development of Chunxiao Oil and Gas Field in Accordance with Chinese Laws
Chinese enterprises welcome the participation of Japanese legal person in the development of the existing oil and gas field in Chunxiao in accordance with the relevant laws of China governing cooperation with foreign enterprises in the exploration and exploitation of offshore petroleum resources.
Appendix 3
Statutes and Conventions
Treaty of Peace, Japan-P.R.C art. 4, Apr. 28, 1952, 136 U.N.T.S. 45, available at https://www.taiwandocuments.org/taipei01.htm
UNCLOS <https://www.UN.org/depts/los>, United Nations Convention on the Law of the Sea, opened for signature 10 Dec 1982, 1833 UNTS 397, entered into force 16 Nov 1994.
Vienna Convention on the Law of Treaties, 1969, 1155 U.N.T.S. 331
Statute of the International Court of Justice
Law on the Territorial Sea and Contiguous Waters: The Chinese government signed the UN Convention on the Law of the Sea in December 1982 and ratified it in May 1996.
Treaty of Mutual Cooperation and Security, U.S. -Japan, Jan. 19, 1960, 11 U.S.T. 1632
Geneva Continental Shelf Convention 1958
Cases
Island of Palmas Arbitration: U.S. v. Netherlands; 2 R. Int’l Arb. Awards 829, 846)(Perm. Ct. Arb. 1928)
Eritrea v. Yemen, 22 R. Int’l Arb. Awards 211, (Perm. Ct. Arb. 1998),
Land, Island and Maritime Frontier Dispute (El Sal. v. Honduras.), 1992 I.C.J
North Sea Continental Shelf Cases (F.R.G. v. Den/F.R.G. v. Neth.), 1969 I.C.J. 3,
North Sea; Continental Shelf (Tunis. v. Libya), 1982 I.C.J 18, 320–323
Continental Shelf (Libya v. Malta), 1985 I.C.J. 13
Denmark. v. Norway. 1993 I.C.J. 38, 58
Qatar v. Bahrain 2001 I.C.J. 40, 111
East Timor (Port. v. Austl.), 1995 I.C.J
Land and Maritime Boundary Between Cameroon and Nigeria (Cameroon v. Nig.), 2002 I.C.J. 325
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[1] Yergin Daniel (1991) has expressed similar views almost two decades an ago. Perhaps this becomes an inevitable truism for most of us.
[2] Ibid
[3] The United Nations convened the Third UN Law of the Sea Conference in 1973 and adopted the UN Convention on the Law of the Sea in 1982.UNCLOS is composed of 17 parts with 320 articles and 9 appendixes involving every aspect of the Law of the
[4] Discussed at length in the chapters below.
[5] This is discussed further below in the contexts of the relevant articles of the UNCLOS especially Art 76.
[6] Igiehon, Mark Osa, “Present international law on delimitation of the continental shelf”, IELTR, 2006, 208-215
[7] Discussed in detail further on during the paper. As a starting point a relevant discussion about the same has been undertaken by Igiehon, Mark Osa, (2006), and Carlos Ramos-Mrosovsky (2008)
[8] For example Paterson, A (2009) has argued that this 2008 Principled Accord is unlikely to last too long simply because it is not a legally binding arrangement or even a binding informal instrument. This has been discussed further below in the paper.
[9] A term coined by Peterson (2009)
[10] Peterson, A (2009) has argued at length however that based on geomorphic factors as they relate to the canons of the UNCLOS Japan may have a superior claim.
[11] Selig S. Harrison, (2005).
[12] This dispute has been ongoing since 1968 when the value of the Senkaku Islands became apparent after a technical investigation See the Emery Report which was Funded by the United Nations Economic Commission for Asia and the Far East, see K.O. Emery (1969): K.O. Emery and Hiroshi Niino, (1968):
Re
[13] The East China Sea covers a total area of 750,000 square kilometers lies between the eastern coast of China’s mainland and the Pacific Ocean, is bounded on the west by China, on the east by the Kyushu and the Ryukyu Islands of Japan, and on the north by Jichu Island of the Republic of Korea (ROK) and the Yellow Sea. Furthermore it connects with the Taiwan Strait on the south. For details see Lee Wei-chin, (1987): 586, pp.143-147.
[14] A detailed discussion of the status of rocks and islets with in the UNCLOS has been discussed much later in this chapter. As a means of how they have been dealt with in UNCLOS jurisprudence till date see Leticia Diaz et al. (2007).
[15] Almost 410 kilometers southwest of mainland Okinawa, 170 kilometers northeast of Keelung, Taiwan, and 145 kilometers north-west of the Japanese Ishigaki Islands.
[16] Valencia (2007:148) and Blanchard (2006:213-216). See also Blanchard (2009) for a detailed updated analysis of the same.
[17] It has been noted by Valencia (2007:166) that the conflict over the East China Sea is by no means limited to China and Japan only despite it being the primary one. This paper focuses solely on the China-Japan conflict however
[18]K.O. Emery and Hiroshi Niino, “ (1968): 13.
[19]Blanchard, J. M. (2006)
[20] After the restoration of its lawful seat in the United Nations in October 1971, China. By 1972 it had put forward the principle of equal consultation for the delimitation of the sea.
[21] This has been noted by Valencia (2007) on Pages 147-150.
[22] In April 1978 when the Third UN Law of the Sea Conference was being written China was stressing upon the delimitation of the sea being based on equitableness and mutual consultation.
[23] Interestingly enough Japan only participated in the First UN Law of the Sea Conference, but was not a signatory to the Convention on the Continental Shelf. When the Third UN Law of the Sea Conference discussed the outer limits of the continental shelf in October 1974, Japan stressed upon the adoption of the equidistant “median line” group as the application of the “natural prolongation” principle would reduce its entitlement to a significant area of the East China Sea.
[24] Ibid
[25] Ibid
[26] Law on the Territorial Sea and Contiguous Waters: The Chinese government signed the UN Convention on the Law of the Sea in December 1982 and ratified it in May 1996. In June 1998 the Ninth National People’s Congress passed the Law of the People’s Republic of China on the Exclusive Economic Zone and the Continental Shelf, which clearly states that topographically, geomorphologically and geologically, the continental shelf of the East China Sea is the continuity and underwater natural prolongation of the Chinese continent. Additionally it has claimed an associated 12 nm of territorial sea and 24 nm of a contiguous zone around the Senkaku (See Blanchard, 2009).
[27] In July 1983 Japan signed the UN Convention on the Law of the Sea and in June 1996 the Japanese Diet passed the Law on the Exclusive Economic Zone and the Continental Shelf, which states clearly that Japan’s claim to the continental shelf is based on the criterion of a distance of 200 nautical miles.
[28] Peterson, A. (2009) and Blanchard (2006)
[29] Including the tragic death of one of the Chinese activists who tried to swim to the Senkaku from protest vessel (Blanchard, 2006)
[30]Blanchard (2006) notes that the Japanese Diet refused a strategic business loan to the financially struggling China at that time.
[31]Blanchard, J. -M. F. (2009), 682–708
[32]Press Release, China and Japan Reach Principled Consensus on East China Sea Issue (June 18, 2008)
[33]Ministry of Foreign Affairs of the People’s Republic of China, “Foreign Ministry Spokesperson Qin Gang’s Regular Press Conference on July 8, 2010,” news release, July 9, 2010,
[34] Blanchard (2009) and Peterson (2009) to name a few.
[35]”China Reiterates ‘Indisputable’ Sovereignty over South China Sea Islands,” Xinhua, July 31, 2010,
[36] Mainichi News Japan (2010) Japan says Senkaku Islands subject to Japan-U.S. Security pact available.
[37] Peterson (2009)
[38] Ibid
[39]Carlos Ramos-Mrosovsky (2008) and Peterson (2009)
[40] Ibid
[41] Treaty of Mutual Cooperation and Security, U.S. -Japan, Jan. 19, 1960, 11 U.S.T. 1632
[42] See (Peterson 2009) the reason is that it has been stated in International case law abundantly that it is not enough for a state to have an inchoate title through discovery of a territory, which are not followed by further steps, by a country to ensure the stay of that title. In this regard see the cases of (Island of Palmas Arbitration: U.S. v. Netherlands, 2 R. Int’l Arb. Awards 829, 846) (Perm. Ct. Arb. 1928) (Eritrea v. Yemen, 22 R. Int’l Arb. Awards 211, (Perm. Ct. Arb. 1998), Land, Island and Maritime Frontier Dispute (El Sal. v. Honduras.), 1992 I.C.J. 351, 563. See also Carlos Ramos-Mrosovsky, International Law’s Unhelpful Role in the Senkaku Islands, and 29 U. PA. J. INT’L L. 903, 911 (2008).
[43] See Tao Cheng, pages 221, 254 (1974) and Tretiak Daniel (1978), pp.1235-1249.
[44] See Carlos Ramos-Mrosovsky (2008) and Peterson (2009)
[45] Ibid-Thus defeating the Chinese claim based on pure discovery in 1372.
[46] See Blanchard (2006) and Blanchard (2009) for a detailed discussion of the same.
[47] Ibid.
[48] Ibid
[49] Paragraph 1 of Article 76 of the UN Convention on the Law of the Sea
[50] The Okinawa Trough is basically, a deep-sea trench situated towards the west of the Ryukyu Island chain and it stretches from Taiwan in the Northern direction towards Kyushu in Japan.
[51] Lee Wei-chin, 1987 as it occurred during the UNCLOS round of talks and the basis therefore has discussed this diversion of views): 586, pp.143-147.
[52] See UNCLOS art. 47(1) about the delimitation methodologies for archipelagic States
[53] A.M Peterson (2009)
[54] The Senkaku Islands are currently under Japanese control and are known in Chinese language, as “Diaoyu,” “Diaoyutai,” “Tiaoyu,” or “Tiaoyutai” Islands. The reference to them as Senkaku is without prejudice to the fact that there are differing theories as to whether they are Islands, Islets or Rocks even though such definitions will ultimately have a significant impact upon the factum of the amount of territory that can be claimed around them all. For more information see Mark J. Valencia, (2007); Leticia Diaz et al., (2007).
[55] ibid
[56] A.M Peterson (2009)
[57] Leticia Diaz et al., (2007) and Peterson (2009)
[58]UNCLOS, art. 121 “(1) An island is a naturally formed area of land, surrounded by water, which is above water at high tide (2) Except as provided for in paragraph 3, the territorial sea, the contiguous zone, the exclusive economic zone and the continental shelf of an island are determined in accordance with the provisions of this Convention applicable to other land territory (3) Rocks which cannot sustain human habitation or economic life of their own shall have no exclusive economic zone or continental shelf.”.
[59] Peterson (2009) and Leticia Diaz et al., (2007)
[60] Ibid
[61] United Nations Convention on the Law of the Sea, Dec. 10, 1982, 1833 U.N.T.S. 97, available at https://www.un.org/Depts/los/convention agreements/texts/unclos/unclos e.pdf [hereinafter UNCLOS] (entered into force Nov. 16, 1994)
[62] This matter is explored in detail by Carlos Ramos-Mrosovsky (2008).
[63]Continental Shelf Convention Art 1, Apr. 29, 1958,
[64]Id. at art. 6(2)
[65]North Sea Continental Shelf Cases (F.R.G. v. Den/F.R.G. v. Neth.), 1969 I.C.J. 3, para. 97, at 52 about delimitation practices by countries on the North Sea; Continental Shelf (Tunis. v. Libya), 1982 I.C.J 18, 320–323 where dissenting opinion noted multiple instances of cooperation between states in the delimitation process .See Peterson (2009)
[66] See Continental Shelf (Libya v. Malta), 1985 I.C.J. 13 where the ICJ stated, “Delimitation is to be effected in accordance with equitable principles and taking account of all relevant circumstances in order to achieve an equitable result.”
[67] This is evident from the approach taken in the case of (Denmark. v. Norway.), 1993 I.C.J. 38, 58 where it can be seen that the court was in the favor of an “equidistance-special circumstances rule” for maritime delimitations); And in the case of Qatar v. Bahrain 2001 I.C.J. 40, 111 where it was stated that court “will first provisionally draw an equidistance line and then consider whether there are circumstances which must lead to an adjustment of that line.”
[68] Peterson (2009)
[69]Carlos Ramos-Mrosovsky (2008).
[70] C. Len; (2007)
[71] Article 83 UNCLOS
[72] 1982 Tunisia-Libya Continental Shelf Case where the court said, “The principles and rules applicable to the delimitation of continental shelf areas are those which are appropriate to bring about an equitable result”.
[73]Andrew Serdy (2008). Pp 941-954
[74] Ibid.
[75]East Timor (Port. v. Austl.), 1995 I.C.J
[76] Serdy (2008)
[77] ibid
[78] Ji, Guoxing. 1995
[79] See lan Perry (2005) and Igiehon, Mark Osa, (2006) 208-215
[80](Cameroon v. Nig.), 2002 I.C.J. 325
[81]Chidinma Bernadine Okafor, (2007)
[82] A term coined by Carlos Ramos-Mrosovsky (2009). This view is shared by Peterson, (2007).
[83] See J. Nandakumar; ” (2004);Janet Xuanli Liao, 2008
[84] See also UNCLOS, art. 123 “States bordering an enclosed or semi-enclosed sea should cooperate with each other in the exercise of their rights and in the performance of their duties under this Convention.”
[85] This has been discussed in detail by Gao Jianjun, (2008)
[86] Discussed in detail by Mark J. Valencia, (1986); Bastida et al., (2006-2007)
[87] Masahiro Miyoshi (1988)
[88] See Shihata and Onorato (1998);
[89] Bernard Taverne, (1994); For a detailed analysis of the same see Z. Gao, (1997) pp .629, 649;
[90] Ian Townsend-Gault, (1988)
[91] Jianjun, Gao (2009) pp. 291-303
[92] See Peterson (2009) and Carlos Ramos-Mrosovsky (2008).
[93] Press Release, Ministry of Foreign Affairs of the People’s Republic of China, China and Japan Reach Principled Consensus on East China Sea Issue (June 18, 2008)
[94] In June 2008 there was a Sino-Japanese arrangement to jointly develop hydrocarbon deposits in a section of the East China Sea. For details see Appendix 1 of the dissertation where it has been reproduced in its original form.
[95] Jianjun, Gao (2009)
[96] Ibid
[97] Wishnick (2009)
[98] Alexander M. Peterson, (2009) pp.441
[99] Mainichi News Japan (2010)
[100] Jianjun, Gao (2009)
[101] ibid
[102] Jianjun, Gao (2009) 291-303
[103] Ibid
[104] See also Carlos Ramos-Mrosovsky, (2008).
[105] See Appendix 1 of this Paper.
[106] David M. Ong (1999)
[107] ibid
[108]See Peterson (2009) who has quoted Ministry Of Foreign Affairs Of Japan, Joint Press Conference By Minister For Foreign Affairs Masahiko Koumura And Minister Of Economy, Trade And Industry Akira Amari (Regarding Cooperation Between Japan And China In The East China Sea), June 18, 2008
[109] Jianjun, Gao (2009)
[110] Ibid.
[111] Jianjin (2009)
[112]Pan J (2008) Pages 187-207.
[113]Ibid
[114] Gau, Michael Sheng-Ti (2009) pp. 61-79(19)
[115] Yusuf, Yusuf Mohammad (2009) 4, 130-137
[116] Ibid.
[117] Unryu Suganuma (2000) “ William B. Heflin (2000)
[118]Yang, H.C.a, Park, S.W.b, Park, S. -H.b, (2006) Pages 175-186
[119] This view is also shared by Philip Andrews-Speed, 2003, p. 7
[120] Yang et al (2006) p.175
[121] Janet Xuanli Liao (2008,) 25, 57–78
[122] Mark Valencia has expressed similar views in his earlier publications like Mark J. Valencia (2002); Mark J. Valencia Yoshihisa Amae, “Regime Building in the East China Sea” (2003)
[123]Okafor, Chidinma Bernadine (2006) pp. 489-522(34)
[124] A word coined by the author of this dissertation based on her own views of the delimitation methodologies available.
[125]Yu, P (2006) Pages 97-128
[126] This view has also been expressed in Wishnick, E. Competition and cooperative practices in Sino-Japanese energy and environmental relations: (2009) Pacific Review And Choi, H. (2009)
[127]Itoh, Shoichi (2007)
[128]C. Len; (2007)
[129] Ibid.
[130]Hillary Clinton, “Remarks” (speech, National Convention Center, Hanoi, Vietnam, July 23, 2010),
[131] On Jan. 19 by the Japanese Foreign Minister Katsuya Okada (of the Newly Elected Democratic Party of Japan) in the course of the 4th Forum for East Asia-Latin America Cooperation (Manichi News Japan (2010)
[132]Mo Hong’e (2010) Xinhuanet News.
[133] Russell Hsiao (2010) China Brief no-14
[134]Wang Zhaokun (2010): Global Times 19 August 2010.
[135] A term coined by Selig S. Harrison (2010)
[136] Ibid.
[137]”China Reiterates ‘Indisputable’ Sovereignty over South China Sea Islands,” Xinhua, July 31, 2010,
[138] The fate of the USS Impeccable is a good reminder to this see Wang Zhaokun (2010),
[139]Ministry of Foreign Affairs of the People’s Republic of China, “Foreign Minister Yang Jiechi Refutes Fallacies on the South China Sea Issue,” news release, July 26, 2010
[140] Peterson (2009)
