Vietnam could face blowback from legal row with China

If Hanoi files an official complaint in its South China Sea dispute with Beijing it could lose more than it wins

Pundits are predicting that Vietnam will soon file a complaint under the United Nations Convention for the Law of the Sea (UNCLOS) dispute-settlement mechanism regarding China’s actions in the South China Sea. As an indication that an official complaint is imminent, they point to Vietnam’s recent nomination of four arbiters and four conciliators as all ratifiers of UNCLOS are entitled to do and many others have done.

Some say that if Vietnam did so and won, “this outcome would be severe blow to China’s prestige and international standing.” That may be so, but the legal obstacles and political blowback from China could be far more costly to Vietnam than to China.

In 2019, China’s Haiyang Dizhi 8 (Marine Geology 8) geophysical survey vessel accompanied by China Coast Guard vessels operated for several months in the Vanguard Bank area of Vietnam’s claimed 200-nautical-mile exclusive economic zone (EEZ). Vietnam’s Foreign Ministry repeatedly accused the vessels of violating the country’s sovereignty.

The Vietnam Coast Guard shadowed the Chinese vessels and demanded – without effect – that the ships immediately leave Vietnam’s EEZ. After three months of mounting tension, and apparently having completed its survey, the Chinese ship departed.

Then this April, the survey ship accompanied by a Coast Guard vessel was again spotted in Vietnam’s claimed EEZ. In response to Vietnam’s concerns, a Chinese Foreign Ministry spokesman said, “The Chinese survey ship was conducting normal activities in waters administered by China.”

The area in question has long been claimed by China. In 1992 in a clever political move it leased an area it calls Wan’an Bei to US oil company Crestone. Wan’an Bei overlaps Vietnam’s already leased petroleum Bocks 130-133 and 154-157.

Despite Hanoi’s righteous indignation, the legal aspects of this case are more complicated than a straightforward egregious violation by China of Vietnam’s EEZ and continental shelf. Arbiters might well determine that Vanguard Bank and the immediate surrounding area belong to Vietnam. But this has yet to be determined and such an assessment would not extend to Vietnam’s entire claimed EEZ and shelf.

Regarding Vanguard Bank, the law would indeed appear to be on Vietnam’s side. A China-Philippines arbitration panel ruled that China’s nine-dash-line historic claim is not compatible with UNCLOS. It also ruled that all of the high-tide features in the Spratly Islands are “legally rocks for purposes of Article 121(3) and do not generate entitlements to an exclusive economic zone or continental shelf.”

But China or those who would represent it in its absence might argue that technically, this ruling on the legal status of the Spratly features applies only to the features examined and named by the arbitration panel, and that it only applies to the Spratlys, not the Paracels, at least not directly.

The general applicability of this particular ruling was – and still is – very controversial for other countries, including the US, that supported the Philippines in bringing the case. Indeed, they have not applied it to their legally held rocks by rescinding the EEZs that they claim they generate. It is quite possible that a different panel in a different context would rule differently.

Indeed, Beijing might argue that the Paracels belong to China as implied in then-North Vietnam prime minister Pham Van Dong’s controversial 1958 diplomatic note; that they are legal islands; and that they generate an EEZ as well as a continental shelf extending out to 350 nautical miles.

Those claims could encompass some of the northern part of the area in contention and necessitate the establishment of boundaries. Moreover, it would probably point out that Vietnam uses an excessive baseline that extends its EEZ and continental shelf in this area further than allowed by UNCLOS and thus the extent of its claims should be reduced.

China might then argue that until a ruling or a boundary is forthcoming, part of the area in question is disputed and that according to the Guyana-Suriname precedent, although surveying is acceptable, neither country should unilaterally proceed with exploitation. This means Beijing might argue that at least a portion of Vietnam EEZ and continental-shelf claims are disputed and that Hanoi should have foreign oil companies cease their exploitation activities in that area until a boundary is established.

Equitable principles would play a role in boundary delimitation – and that is a crapshoot. For example, China might argue that it has the greater need for the resources based on its greater population.

These are uncertainties regarding the merits of Vietnam’s case. But even if it is sure of victory on the merits, it must first persuade an arbitration panel that it has jurisdiction. A Chinese claim to part of the area based on the Paracels could complicate an arbitration panel’s acceptance of jurisdiction.

According to UNCLOS Article 298, exemptions from jurisdiction include sovereignty disputes, boundary delimitation, and military and law-enforcement activities. China might argue that this dispute does indeed involve one or more of these exemptions. The China-Philippines arbitration panel made a rather narrow interpretation of these requirements for jurisdiction. But another panel in another context might decide differently.

Another obstacle that Vietnam has to overcome before proceeding to arbitration is “admissibility.” There exists a China-Vietnam bilateral agreement that stipulates “for sea-related disputes between Viet Nam and China, the two sides shall settle them through friendly negotiations and consultations.”

Whether this would apply and prevent the panel from proceeding depends on the status of this “agreement.” If it is considered formal and binding, it will carry more weight with the panel than the Declaration on Conduct of the Parties in the South China Sea that the previous panel dismissed as only a “political statement” and thus did not prevent “admissibility.”

It is by no means certain that the panel will accept jurisdiction and admissibility.

But if Hanoi’s complaint passes the procedural hurdles and after several years and considerable expense is finally victorious, the advantages are that it will satisfy Vietnam’s nationalists, recover some lost pride, credibility and legitimacy for the government, and bring international law to its side – for what that is worth in the face of raw power politics.

But if its past behavior in the Philippines complaint is any indication, China will not participate in the proceedings nor will it recognize or abide by any unfavorable decision. Instead it will retaliate against Vietnam with a combination of sticks and carrots until it obtains a favorable practical outcome.

Indeed, there are many bad things that China could do to retaliate against such a move and about which Vietnam could do little. It could step up its enforcement of its fisheries laws around the Paracels. It could increase its military presence near Vietnam’s occupied features and hinder their resupply.

It could step up its petroleum exploration in the portion of the disputed area it claims, thus discouraging exploration by Vietnam’s contractors. Already Spanish oil company Repsol returned to Vietnam’s state oil company three exploration blocks in the area because of the uncertainties posed by China’s opposition to its activities. The most recent sail through the area by a Chinese survey vessel may have been a warning for Vietnam not to allow its contractors to proceed with exploration there.

These are all escalatory actions and it is hoped that China would not implement them. But Vietnam should be aware that it might do so.

Some say that if Vietnam proceeds with arbitration, it would provide “grounds for resisting Chinese actions, providing a basis for the international community to support Vietnam.” But the US and some of its allies have already constantly bashed China regarding its behavior in the South China Sea to no avail. If Vietnam is counting on international support to deter or change China’s behavior, it could well be sadly mistaken.

Although the US would likely support and use Vietnam’s action to stoke its narrative of the China threat, China would perceive that Vietnam had sided with the US in their great-power contest. Of all countries, Vietnam should know that if the going gets tough, the US will likely cut its losses and abandon it – principles notwithstanding.

In sum, if Vietnam takes China to arbitration on this issue, it faces major legal and political obstacles. And even if it is legally victorious, its relations with its giant neighbor, and China’ behavior toward it, may well get worse.

Hanoi should avoid being pushed or lured into this no-win situation by zealous nationalists, self-serving foreign advisers, and countries that may profit financially or politically from it while Vietnam bears all the risks.

By Mark Valencia – Asia Times – June 26, 2020