UN: Polish ITLOS Judge Stanislaw Pawlak appointed for Philippine - China Spratlys Trial

Sea tribunal names judge to PHILIPPINES arbitration case vs CHINA over Spratlys area

The Philippines' arbitration case against China has moved a step forward after the president of the International Tribunal for the Law of the Sea (ITLOS) appointed the second member of the ad hoc tribunal that would deliberate on the country's bid to stop Chinese incursions into the West Philippine Sea (South China Sea).

The Department of Foreign Affairs (DFA) confirmed on Monday that the ITLOS president, Judge Shunji Yanai, appointed Polish ITLOS Judge Stanislaw Pawlak to the panel last week, leaving only three more slots to be filled in the tribunal.

Pawlak will join the panel with German Judge Rudiger Wolfrum, the arbiter appointed by the Philippines when it announced its arbitration bid in January 2013.

The Polish judge's appointment is the first for Yanai, who took on the task of composing the arbitral panel after China announced its rejection of the proceedings.

Under the United Nations Convention on the Law of the Sea (UNCLOS), the international law the Philippines invoked in seeking arbitration, the ITLOS president has the power to appoint members of the panel in case one party refuses to take part in the proceedings.

China waived its right to name its representatives to the ad hoc panel upon formally announcing its rejection of the proceedings.

"The next step will be for the ITLOS president to appoint the other three members of the arbitral tribunal upon the written request of the Philippines," DFA spokesperson Assistant Secretary Raul Hernandez told a briefing on Monday.

He reiterated that the arbitration would be a peaceful process to settle disputes in the contested waters.

"We stress that arbitration is a peaceful and durable form of dispute settlement pursuant to international law," said Hernandez.

The Philippines went to the UN in January in hopes of halting Chinese incursions into the West Philippine Sea and nullifying China's nine-dash line, which encroaches into established Philippine maritime boundaries.

The DFA had contended that the nine-dash line was an "excessive claim in violation of international law, the UNCLOS." Both countries ratified the international law but disagreed on interpreting its letter, particularly on the matter of maritime boundaries.

The move specifically seeks to stop the Chinese occupation and construction on smaller islands in the West Philippine Sea that are claimed by the Philippines and hopes to compel the Chinese to respect the Philippines' exclusive economic zone and continental shelf.

The DFA had said it took the legal action after exhausting all other means to peacefully settle the dispute.

But China rejected the Philippines' move citing "indisputable sovereignty" over resource-rich territories in the West Philippine Sea and asserted that the issue should be resolved through direct negotiations between the two countries.

While impartial on the merits of the case, several countries have expressed support for the Philippines' decision to take a peaceful step toward resolving the dispute, among them, the United States and Germany. The United Nations also took the same position.

Japan, which has its own territorial dispute with China over islands in the East China Sea, said the Philippines' move was "understandable."

"I think it's understandable, the solution that [the Philippines is] seeking… they are not using force and they are trying to find the peaceful solution under the rule of law. So in that sense we totally understand the Philippine action," said Japanese Ambassador to the Philippines Toshinao Urabe in a recent interview.

"We're just waiting for what's going to happen. So we totally understand the action, but we're not taking sides," he said.

The envoy happens to know the ITLOS president, a compatriot, and remarked that the judge would be fair in handling the arbitration case against China despite its dispute with Japan.

"It doesn't matter [that the ITLOS president is Japanese]. It's under the rule of law. And I know him. He's a very impartial person, a very understanding person and I don't think he will use his position to advance the national interest," Urabe said.

INQUIRER Global Nation 

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GOING GLOBAL: Filipino competitiveness is NOT GOOD, IT’S GREAT!

Illustration by REY RIVERA

By James Michael Lafferty

MANILA, Philippines -I was a panelist last week in the Euromoney Philippines Investment Forum along with many dignitaries, including President Benigno Aquino III and Secretary of Finance Cesar Purisima. One of those "standard" questions came up concerning, "What can the Philippines do to improve competitiveness?" I think many people were shocked at how bullish I am on the Philippines. And I am not saying there is nothing to improve upon. It is just that, from my vantage point of leading multinationals in this country, this nation is incredibly competitive! Let me tell a few stories to explain why.

I have worked for some of the biggest and most respected consumer goods companies: Procter and Gamble. Coca-Cola. And now BAT. And on five continents and over 40 countries.

In every country, there are indeed competitors — some local, but typically the ones concerned being other multinationals. Like when I was at Coke, my biggest worry was Pepsi most of the time, not the local cola brand.

There is, however, one nation that stands out. Where the local companies are so good, so well run, that they represent the big competitive risk. And that country is right here, the Philippines!

Let me give some examples.

P&G is the biggest laundry detergent company in the world. By far. And in normal cases, the key competitors are companies like Unilever, or Henkel, as examples. But not here. In my time leading P&G, the leader of the laundry detergent bar segment, which was nearly half of the market, was a great brand called Champion from Peerless. A local company. Well run. A very formidable competitor. They were winning market shares. And they deserved it, doing a better job of delivering real consumer value. I respected them. And they made me better.

You can see the same in many, if not most, consumer categories. Diapers have EQ, a brilliant local brand. Toothpaste has Hapee. And there are many more: Splash Corporation, Belo Skincare, Alaska Milk — all local Filipino companies that are well run, hyper-competitive, and winning market shares.

I have never seen a market like this. So competitive. So good at turning out world-class companies and talent.

My two favorite examples start with iced tea. I can only imagine if I was a consultant, and a local company came to me and asked, "Do you think we can win if we enter a category dominated by Coca-Cola, Pepsi Cola, Unilever, and Nestle?" My answer would be, "Don't be crazy, you are taking on four monsters. Go find something else to compete in!"

Well, I am glad my friend Lance Gokongwei and his colleagues at URC never asked me. Because what they did is extraordinary. They entered. They had the unique name, flavors, and distribution strategy of C2. And in a few short years, they took the lead from the big boys. It's about as impressive a story as there is. In fact, it's a lot more impressive in my view than the story of Bill Gates starting up in a garage!

Finally, when I retired from P&G and left the Philippines, sadly, for my new role in Nigeria as CEO of Coca-Cola, I met in my first week in Lagos with my top customer, an owner of the largest fast-food chain called Chicken Republic. We were chatting and he asked me where I came from. I answered, "The Philippines." And I will never forget his answer.

"Oh, my gosh! That's neat! My hero is a Filipino."

So I, of course, asked, "Who is that?"

His answer was, "Tony Tan, the founder of Jollibee. And let me tell you why. I am today the biggest fast food chain in Nigeria. But we know McDonald's is coming. And it is scary, all their money and might and PR. But we have hope. Because somewhere out there in this world, there is a local chain that has succeeded in beating McDonald's, and keeping leadership. And that is Jollibee."

I loved it. Even in the middle of Nigeria, the excellence of Filipino business is recognized and cheered.

Nine months later, upon the gracious invitation of Tony Tan and his team at Jollibee, I escorted my Nigerian customer and his team to Manila for a one-week visit with Jollibee to learn. It was a wonderful experience, and the entire group could not say enough good things about Jollibee, their leadership, and their commitment to excellence. It is a great, great company.

I could go on and on. This country has amazing competitiveness. Yes, we can do more. We can continue to truly knock down barriers to free market competition, to level the playing field like was recently done in tobacco, to allow more companies to enter and invest. We can continue to push for investment-grade ratings, to open up more capital markets to our businesses. We can upgrade more infrastructure.  The administration is pushing all the right buttons. Anyone can see it.

And I tell you this: with the amazing base of talent, skill and competitiveness this nation has right now, if we fix these things, it will be downright exciting — and scary to some — how competitive this country's businesses can be.

The Philippine Star

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