Breakfast Roundtable on the West Philippine Sea: Understanding Geopolitical Tensions and Corporate Governance Solutions

By: Kenneth Vicarl M. Lagera, MPR

Research and Development Assistant Manager

Institute of Corporate Directors

Retired Associate Justice Antonio Carpio and Atty. Jay Batongbacal shared their expert insights about the Philippines' claim on the West Philippine Sea and the geopolitical tensions surrounding this crucial area in an exclusive ICD Members event on August 15, 2024, at Makati Sports Club. Entitled “The West Philippine Sea: Understanding Geopolitical Tensions and Corporate Governance Solutions,” the breakfast roundtable discussion aimed to help ICD Members understand the current geopolitical tensions over the disputed sea and to reflect on possible corporate governance solutions.

Justice Carpio: Philippine Island Territories in the West Philippine Sea

Retired Associate Justice Antonio Carpio shared his lecture, focusing on identifying which islands in the West Philippine Sea are part of Philippine territory under Philippine sovereignty. The Philippine government claims that Bajo de Masinloc (also known as Scarborough Shoal) and the Kalayaan Group of Islands (northeastern section of the Spratly Islands) in the West Philippine Sea are part of Philippine territory. However, neighboring countries, especially China, have similar claims.

Three treaties define Philippine territorial boundaries: the 1898 Treaty of Paris which ceded the Philippine Archipelago (excluding Bajo de Masinloc and Kalayaan Group of Islands) from Spain to the United States, defining the initial territorial boundaries of the Philippines; the 1900 Treaty of Washington which clarified that the Bajo de Masinloc and Kalayaan Group of Islands are part of the Philippine Archipelago that was ceded to the United States; and the 1930 Treaty with the United Kingdom which established the boundary between the Philippines and North Borneo, further supporting the inclusion of the disputed islands in the Philippine territory.

Uti possidetis juris, the principle of international law that provides that newly independent states retain the territorial boundaries that existed under their preceding colonial authority before their independence, supports the claim of the Philippines. China recognized the mentioned treaties defining Philippine territory but does not support its claim.

Justice Carpio recommended that “[t]he Philippines should invite China, Vietnam, and Malaysia to submit the territorial dispute in the Spratlys to voluntary arbitration by the International Court of Justice. Separately, the Philippines should also invite China to submit the territorial dispute over Scarborough Shoal to voluntary arbitration by the International Court of Justice (ICJ).

The arbitration by ICJ will finally settle by peaceful means, as mandated by the UN Charter, the territorial disputes in the Spratlys and Scarborough Shoal.” If other disputant states refuse arbitration, he recommends that the Philippines “present its iron-clad evidence of sovereignty over the Spratlys and Scarborough Shoal to the court of world opinion.”

Atty. Batongbacal: The West Philippine Sea: Geopolitical Tensions and Corporate Governance Solutions

The director of the UP Institute of Maritime Affairs and Law of the Sea, Atty. Jay Batongbacal, focused his lecture on the Philippine interest in the West Philippine Sea, the geopolitical tension and disputes between the Philippines and China, and the legal effects of the South China Sea Arbitration.

Atty. Batongbacal shared that Administrative Order No. 29 (2012) identified “Luzon Sea as well as the waters around, within and adjacent to the Kalayaan Island Group and Bajo De Masinloc, also known as Scarborough Shoal” as the maritime areas comprising the West Philippine Sea.

The key interests of the Philippines in the disputed waters include food security (fisheries), environmental sustainability, energy security (offshore petroleum), trade and communications access, and potential mineral and genetic resources.

Atty. Batongbacal noted that there are two categories of disputes over the West Philippine Sea: territorial disputes and maritime disputes. Territorial disputes concern sovereignty over the islands and rocks in the West Philippine Sea, while maritime disputes concern jurisdiction over oceans beyond the territorial sea of those islands.

In his conclusion, Atty Batongbacal pointed out that the South China Sea Arbitration ruling in 2016 vindicates the Philippine's “exclusive sovereign rights and jurisdiction over living and non-living natural resources in the [West Philippine Sea].” The ruling also invalidated China's “nine-dash line” claim. Finally, it “lays the foundation for proper management of the Blue Economy in the [West Philippine Sea].”