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China has rejected a court ruling issued by a UN Tribunal which denies China’s territorial rights in the South China Sea. The ruling comes after the Philippines submitted a case to the court under the 2012 Law of the Sea Treaty to which both China and the Philippines are signatories. Specifically, the ruling found that China has no legal basis for claims to the islands in the South China Sea, including the Spratly and Parcel Islands. Law of the Sea Treaty only guarantees rights to the sea up to 200 miles off of a state’s main coastline; as a result, the South China Sea Islands are not China’s territory but rightfully belong to the Philippines. The court also ruled that China had violated international law by interfering with Philippine fishing and building artificial islands in what the court deemed to be international waters.

China rejected the ruling, claiming the court only has the authority to rule on “maritime rights”, and that it has no authority to rule on what amounts to a “territorial dispute.” The court rejected this assertion.

China claims that the islands have historically been China’s property since 1947 when the islands were seen as a crucial part of the Chinese nation.  China claims a “nine dash line” arranged in a half-circle near Vietnam, the Philippines, Taiwan, and Malaysia; as well as all sea territory between the dashes including the Parcel and Spratly island chains.

Vietnam argues that China had no presence on the islands before 1940 while claiming it can prove control over the islands since the 17th Century.

In addition to securing exclusive fishing rights, the islands contain vast natural resources and are a strategic location for trade; it is estimated that $5 trillion of trade goes through the waterway each year; designating it as international waters would prevent China from potentially exacting tariffs on ships passing through. The South China Sea is also estimated to contain roughly seven billion barrels of oil and 900 trillion cubic feet of natural gas; these resources are especially attractive for China, who consumes roughly 10 percent of the world’s oil while only accounting for 1.1 percent of its production.

The most violent dispute over the islands has been between China and Vietnam. In 1974, citing ancestral land claims, China forcibly seized the Parcel Islands from Vietnam, killing 74 Vietnamese troops. In 1988, the two sides clashed again on the Parcel Islands, leading to the death of 60 Vietnamese soldiers. Tensions escalated in 2014, when China attempted to build an oil rig near Vietnam, provoking conflict between the two navies.

The tribunal’s ruling in favor of the Philippines is only the latest of many tense disputes between it and China. In 2012, the two countries engaged in a naval stand-off, with each side accusing the other of drilling into a Coral Reef known as the Scarborough Shoal. The next year, the Philippines announced that it was taking China to a UN tribunal under the Law of the Sea Treaty.

In 2015, satellite images surfaced that revealed China’s military expansion onto South China Sea islands as well as the construction of man-made islands in the claimed area, which were also quickly militarized.

The conflict over the islands remains one of the most divisive issue in Asian international relations and the countries are unable to agree even on how to begin negotiations. China prefers bilateral negotiations to deal with the issue but their neighbors, realizing China’s size and power puts them at a disadvantage, favor negotiation through the ASEAN bloc, which China rejects.

China’s rejection of the ruling is a reminder of one of the reasons why U.S. critics of the Law of the Sea Treaty have urged the U.S. to remain a non-signatory; namely the willingness of powers like China to disregard such signed treaties when it suits them. It is also a reminder that ultimately the United States must rely on its ability to project naval power, and not multilateral agreements, in order to insure its commitment to freedom of navigation and customary international maritime law.

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