Contextualising International Law in Northeast Asia 9781509915316, 9781509915330, 9781509915323

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CONTEXTUALISING INTERNATIONAL LAW IN NORTHEAST ASIA Northeast Asia is one of the most important regions of the world, both ­economically and in terms of its historical heritage. The region poses significant challenges for international law, whilst international law can unleash cooperative endeavours which could place the region in a formidable location in the new multi-polar world order. This work sets out a contextual regional approach to international law focusing on the relations between China, South Korea and Japan. In particular the author deliberates on the historical development of international law in the region; the relationship of international law with the Chinese, Korean and Japanese legal systems; historical disputes between the three States; and the respective practices in the sphere of monetary and trade relations. This work will be of interest to international law scholars, practitioners and policy makers.

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Contextualising International Law in Northeast Asia

Asif H Qureshi

HART PUBLISHING Bloomsbury Publishing Plc Kemp House, Chawley Park, Cumnor Hill, Oxford, OX2 9PH, UK HART PUBLISHING, the Hart/Stag logo, BLOOMSBURY and the Diana logo are trademarks of Bloomsbury Publishing Plc First published in Great Britain 2018 Copyright © Asif H Qureshi, 2018 Asif H Qureshi has asserted his right under the Copyright, Designs and Patents Act 1988 to be identified as Author of this work. All rights reserved. No part of this publication may be reproduced or transmitted in any form or by any means, electronic or mechanical, including photocopying, recording, or any information storage or retrieval system, without prior permission in writing from the publishers. While every care has been taken to ensure the accuracy of this work, no responsibility for loss or damage occasioned to any person acting or refraining from action as a result of any statement in it can be accepted by the authors, editors or publishers. All UK Government legislation and other public sector information used in the work is Crown Copyright ©. All House of Lords and House of Commons information used in the work is Parliamentary Copyright ©. This information is reused under the terms of the Open Government Licence v3.0 (http://www.nationalarchives.gov.uk/doc/ open-government-licence/version/3) except where otherwise stated. All Eur-lex material used in the work is © European Union, http://eur-lex.europa.eu/, 1998–2018. A catalogue record for this book is available from the British Library. Library of Congress Cataloging-in-Publication data Names: Qureshi, Asif H. (Asif Hasan), 1956-, author. Title: Contextualising international law in Northeast Asia / Asif H Qureshi. Description: Portland, Oregon : Hart Publishing, 2018. Identifiers: LCCN 2018013675 (print)  |  LCCN 2018013819 (ebook)  |  ISBN 9781509915309 (Epub)  |  ISBN 9781509915316 (hardback : alk. paper) Subjects: LCSH: International law—East Asia. Classification: LCC KZ4335 (ebook)  |  LCC KZ4335 .Q74 2018 (print)  |  DDC 341.095—dc23 LC record available at https://lccn.loc.gov/2018013675 ISBN: HB: 978-1-50991-531-6 ePDF: 978-1-50991-532-3 ePub: 978-1-50991-530-9 Typeset by Compuscript Ltd, Shannon To find out more about our authors and books visit www.hartpublishing.co.uk. Here you will find extracts, author information, details of forthcoming events and the option to sign up for our newsletters.

To My darling son Habib—for ever my love!

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PREFACE

This focus on International Law in North East Asia (NEA) comes in the wake of my residence in South Korea, after several years of teaching and research in International Law in the UK. In this region of course, it has not been possible to escape the challenges of International Law. In particular, my International Law perspective of the region comes mainly from my first impressions which of course I am constantly revising as my understanding develops—after all I had arrived in Korea with western educated spectacles despite my somewhat eclectic approach to it. There is in fact in NEA a growing discourse on International Law, along with an impressive energy in the efforts at its development—sufficiently enough for me to reflect whether the western spectacles that I arrived with had in fact been distorting my vision all along of developments in International Law. This awakening came very poignantly when one day after having placed the world map on the wall of my office, and having thought nothing of it for some time, I was suddenly drawn to it one day. And for a moment I wondered if I was intoxicated. Had I bought the wrong world map? Was there a printing error? For the centre of the world on this map was not Europe but in fact the Pacific with China, Korea and Japan almost at its epicentre! I am grateful to Professor Nohyoung Park for first introducing me to the idea of International Law in North East Asia. I am grateful to the Law School, Korea ­University for having given me this opportunity to write this monograph. It has taken me five years to write—a journey enriched by an enthusiastic cohort of ­students from the region to whom I am grateful for allowing me to learn along with them. Yet I still feel I have rushed this work. I am sure I need another five years to write it properly. The errors, the distortions, the patronising tone of the outsider—are all my blemishes, for which I take full responsibility.

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CONTENTS

Preface���������������������������������������������������������������������������������������������������������������������� vii List of Abbreviations����������������������������������������������������������������������������������������������� xiii Table of International Cases��������������������������������������������������������������������������������������xv

Introduction���������������������������������������������������������������������������������������������������������������1 Part One: Theory and Fundamental Themes 1. Contextualising International Law in the North East Asian Matrix����������������7 I. Introduction����������������������������������������������������������������������������������������������7 II. Does Regionalism have a Normative Basis in International Law?��������11 III. Contextualising International Law��������������������������������������������������������17 IV. Contextualising International Law in Practice��������������������������������������26 V. Conclusions���������������������������������������������������������������������������������������������27 2. Challenging Approaches to the Application of International Law in the Historical Setting of North East Asia����������������������������������������������������29 I. Introduction��������������������������������������������������������������������������������������������29 II. Filters and Obstacles in a Historical Perspective of International Law in NEA������������������������������������������������������������������31 A. Temporal Filters: Legality and Policy���������������������������������������������33 i. Rectificatory Justice���������������������������������������������������������������40 III. Antecedents of International Law in NEA���������������������������������������������42 A. Inter-State Relations in Pre-modern Period���������������������������������42 B. International Law in NEA in Modern Times��������������������������������49 i. Preliminary Observations�����������������������������������������������������49 ii. The Reception and Dissemination of Western Interpretations of International Law in NEA�����������������������51 iii. Outline of Historical Inter-se and External Relations in NEA��������������������������������������������������������������������53 IV. Conclusion����������������������������������������������������������������������������������������������61 3. Regional Peace and Harmonisation through the Rule of International Law in the Domestic Legal Systems in North East Asia����������������������������������62 I. Introduction��������������������������������������������������������������������������������������������62 II. Theory�����������������������������������������������������������������������������������������������������63

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III. Practice����������������������������������������������������������������������������������������������������67 A. China�����������������������������������������������������������������������������������������������67 B. Korea�����������������������������������������������������������������������������������������������71 i. Direct Applicability of WTO Agreements����������������������������72 ii. Constitutional Arrangements for Treaty-making����������������78 iii. Conclusion�����������������������������������������������������������������������������78 C. Japan������������������������������������������������������������������������������������������������79 IV. Conclusion����������������������������������������������������������������������������������������������81 Part Two: International Law in North East Asia: Generally 4. The Pursuit of Justice in the Historically Charged North East Asia��������������85 I. Introduction��������������������������������������������������������������������������������������������85 II. The Law of the Sea and NEA Island Disputes���������������������������������������87 A. Dokdo/Takeshima Islands Dispute between Japan and Korea�����95 B. Senkaku/Diaoyu Islands Dispute between China and Japan�������99 III. Human Rights and Comfort Women��������������������������������������������������103 IV. Denuclearisation in the Korean Peninsula������������������������������������������111 V. Approaches to Resolving Historical Conflicts in a Regional Setting�����������������������������������������������������������������������������117 Part Three: Foreign Economic Relations 5. International Legal Aspects of ‘Monetary’ Relations in North East Asia�����123 I. Introduction������������������������������������������������������������������������������������������123 II. Is there a Rationale for a Regional NEA Focus?����������������������������������124 III. Is there a Financial and Normative Framework for the Management of Regional Monetary Relations?����������������������129 A. Is there a Prohibition to Harm Another State’s Economy Under Customary International Law?�����������������������������������������130 B. Is there a Regionally Specific Normative Regime in NEA?���������133 C. Aspects of National Monetary Legislation having a Regional Impact�������������������������������������������������������������������������137 D. How is the IMF and its Law Adapted to Regionalism?���������������141 IV. What is the Ethical Discourse on Monetary Relations?����������������������147 V. Instilling Disciplines in Transmission Channels���������������������������������154 VI. Conclusion��������������������������������������������������������������������������������������������154 6. International Legal Aspects of Free Trade Agreements in North East Asia�������������������������������������������������������������������������������������������156 I. Introduction������������������������������������������������������������������������������������������156 II. Comparative National FTA Strategies and the Legal Framework in NEA�������������������������������������������������������������������������������160 A. The National FTA Strategies��������������������������������������������������������161 B. The National Legal Frameworks��������������������������������������������������165 C. The Normative Map of NEA FTAs����������������������������������������������168

Contents xi

III. Towards a Regional FTA?����������������������������������������������������������������������169 IV. The International Legal Framework����������������������������������������������������172 A. The Nature of the Right to Discriminate in International Trade and Investment�������������������������������������������������������������������173 B. The Relationship between WTO and FTAs���������������������������������174 C. The WTO Disciplines�������������������������������������������������������������������175 V. Some Reflections on Policy Considerations����������������������������������������178 A. Reflections on Regulatory Harmonisation����������������������������������178 B. Reflections on the Configuration of Both Trade and Foreign Investment in FTAs��������������������������������������������������179 C. Reflections on Ethical Issues Concerned with FTAs�������������������181 VI. Conclusions�������������������������������������������������������������������������������������������184 Part Four: Conclusions Conclusions������������������������������������������������������������������������������������������������������������187

Index�����������������������������������������������������������������������������������������������������������������������189

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LIST OF ABBREVIATIONS

AB ADA

AGP AMRO ASEAN CIL CKJ FTA CMIM CPTPP DSU EEZ ERPD EB EPAs FDI FSAP FSAA FTA General International Law  GATT GATS GVCs ICJ IAEA ICSID ILC IMF LDC MPC

Appellate Body (WTO) Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 Agreement on Government Procurement ASEAN plus 3 Macroeconomic Research Office Association of Southeast Asian Nations Customary International Law China-Japan-Korea Free Trade Agreement Chiang Mai Initiative Multilateralization Comprehensive and Progressive Trans-Pacific Partnership Dispute Settlement Understanding Exclusive Economic Zones Economic Review and Policy Dialogue Executive Board Economic Partnership Agreements Foreign Direct Investment Financial Sector Assessment Program Financial System Stability Assessment Free Trade Agreement Customary International Law and General Principles of Law General Agreement on Tariffs and Trade General Agreement on Trade in Services Globalised value chains International Court of Justice International Atomic Energy Agency International Centre for Settlement of Investment Disputes International Law Commission (UN) International Monetary Fund Less Developing Countries Monetary Policy Committee

xiv  List of Abbreviations

NPT North Korea NPC NEA RAM REO RFAs RCEP ROK SCAPIN SDR SME THAAD TCS TPP UNCLOS UNHRC VCLT West-centric WTO

Treaty on the Non-Proliferation of Nuclear Weapons Democratic People’s Republic of Korea (DPRK) National People’s Congress North East Asia Risk Assessment Matrix Regional Economic Outlook Regional Financing Arrangements Regional Comprehensive Economic Partnership Republic of Korea Supreme Commander for the Allied Powers  Special Drawing Rights Small and Medium Sized Enterprises Terminal High Altitude Area Defence Trilateral Cooperation Secretariat Trans-Pacific Partnership United Nations Convention on the Law of the Sea of 10 December 1982 United Nations Human Rights Council Vienna Convention on Law of Treaties 1969 European/North American perspectives World Trade Organization

TABLE OF INTERNATIONAL CASES

Application of the Interim Accord of 13 September 1995 (The former Yugoslav Republic of Macedonia v Greece) (ICJ: 2011);������������������������������������������������������������������24 Asylum (Colombia v Peru) [ICJ: 1950]���������������������������������������������������������������������������������22 Case Concerning Maritime Dispute (Peru v Chile) (ICJ:2014)�������������������������������������23, 24 Costa Rica v Nicaragua (ICJ: 2015)����������������������������������������������������������������������������������������21 Case Concerning Sovereignty Over Pedra Branca/Pulau Batu Puteh Middle Rocks and South Ledge (Malaysia/Singapore) (ICJ: 2008)���������������������������������������������22, 23, 24 Dispute Regarding Navigational and Related Rights (Costa Rica v Nicaragua) (ICJ: 2009)���������������������������������������������������������������������������������������������������������������������������24 Frontier Dispute (Burkina Faso/Republic of Mali) (ICJ: 1986)�������������������������������������������22 Frontier Dispute (Burkina Faso/Niger) (ICJ: 2013)��������������������������������������������������������������24 International Law of the Unilateral Declaration of Independence in Respect of Kosovo, ICJ Advisory Opinion (2010)��������������������������������������������������������������������������20 In the Matter of the South China Sea Arbitration (PCA 2016)��������������������������������������������96 Islands of Palmas Arbitration, Netherlands v US (PCA 1928)���������������������������������������32, 55 Jurisdictional Immunities of the State (Germany v Italy: Greece Intervening) (ICJ: 2012)���������������������������������������������������������������������������������������������������������������22, 24, 37 Legality of the Threat or Use of Nuclear Weapons, ICJ Advisory Opinion (1996)�����������������������������������������������������������������������������������������������������18, 19, 113 Maritime Delimitation and Territorial Questions between Qatar and Bahrain (Qatar v Bahrain), Merits, Judgment, (ICJ: 2001)������������������������������������������������������23, 93 Peru-Additional Duty on Imports of Certain Agricultural Products (WT/DS 457/ AB/R, 2015)�������������������������������������������������������������������������������������������������40 Questions Relating to the Obligation to Prosecute or Extradite (Belgium v Senegal) (ICJ: 2012)����������������������������������������������������������������������������������������24 Jurisdictional Immunities of the State (Germany v Italy: Greece Intervening) (ICJ: 2012)���������������������������������������������������������������������������������������������������������������������22, 37 Request for Interpretation of the Judgement of 15 June 1962 In the Case Concerning the Temple of Preah Vihear (Cambodia v Thailand) (ICJ: 2013)����������������24 Reparation for Injuries Suffered in the Service of the United Nations (ICJ Advisory Opinion 1949)���������������������������������������������������������������������������������������������������������������21, 25 SS Lotus Case (France v Turkey), PCIJ Rep (1927) Series A No 10��������������������������������������21 Territorial and Maritime Dispute between Nicaragua and Honduras in the Caribbean Sea (Nicaragua v. Honduras), Judgment, (ICJ: 2007)��������������������������22 Territorial and Maritime Dispute (Nicaragua v Colombia), Judgment, (ICJ: 2012)�����������23 Turkey-Textiles (WT/DS34/AB/R 1999)����������������������������������������������������������������������175, 176 Western Sahara, ICJ Advisory Opinion (1975)���������������������������������������������������������������������25

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Introduction International Law facilitates change, enables justice, imposes the rule of law in State relations. But in North East Asia (NEA), as in many other parts of the world, whilst change, justice and the rule of International Law are indeed needed, the most that is required is a regional environment of peace, harmony and trust as between and within the States in NEA. International Law can only have substance in an atmosphere that is conducive to its reception. This involves not only peace building efforts but also institutionalising International Law within the very architecture of domestic legal systems. Thus, whilst this work focuses on the International Law of the relations inter-se of China, Korea and Japan, the lesson from such an exploration is the need to prepare the domestic social political environment within which International Law can deliver on its promises. Without this, legal analysis is reduced somewhat to a form of trivial pursuit, where legal point scoring becomes an end itself. The spaces of this environment exist in schools and universities, in legal education, in the media, in the framework of the domestic political arena, in the ­architecture of the respective Constitutions, and in culture and sports and such related inter-country engagements. In short, there is the need for social engineering in these spaces—social engineering not in the pejorative but in the sense of rendering an environment that is more conducive for the reception of the benefits that International Law can deliver. Whilst these are in some measure the challenges of the social scientist, there is a role here for the legal architect in the design of these spaces. There is at present no discipline in Public International Law that focuses in a coherent manner on this important and necessary underlayer for Public International Law viz, a prior layer of law, institutions and environment in the domestic sphere. I would title this discipline, for it is a discipline that needs specific focus, as the Public International Law of Internal Affairs. This discipline may in part be programmatic and facilitative drawing on such disciplines as social psychology, Public Law including Constitutional Law, Comparative Law and of course International Law. Its many tentacles are also set in justice and multilateral agreements which have a focus on domestic systems, in particular good governance. Some examples of these different spaces are proffered here where changes can be instituted. First, the discourse on school history textbooks in NEA, should mainly be about inculcating a critical mindset in interpreting historical events, presented with all the facts. Above all education should be about understanding and respecting different kinds of people, including recognising the possibility of different ­historical narratives. Historical narratives however objective cannot be imposed by the State or by outside forces. Where this is the case there is no e­ ducation being

2  Introduction

imparted. Regimented history narratives breed hatred and nationalism. Moreover, generally neighbouring States are the most likely source of past, present and future disputes. Therefore, there has to be an environment wherein future generations are equipped to deal with averting neighbourly clashes, and indeed turning neighbourliness to an advantage for cooperation and prosperity. Student exchanges, diversity of NEA teachers within each other’s schools, lessons in NEA languages and cultures may assist in this respect. Second, in universities there has to be academic freedom and a greater degree of academic exchanges within NEA, including with North Korean universities. Demonising neighbours are symptoms of primitive societies, and do not contribute to a measured discourse. Moreover, there is a case for Korean Chinese and Japanese universities to have a healthy diversity of academics from within the region at the least, not to mention those from outside the region. Academic diversity within universities in NEA engenders a diversity of perspectives and exchanges, thus promoting mutual understanding, quality in teaching and research, including academic independence. A NEA-based diversity is also conducive to reinforcing and cultivating the positive civilisational contribution of the region. Sadly, the lack of substantive academic freedom and diversity in universities within the region has meant that legal research can take the form of national advocacy closely following national preoccupations and efforts. To some extent this may be the case worldwide and thus has to be understood in relative terms, but this in itself is not reason for complacency. And when it comes to the study of International Law there is the need to make it a compulsory component in university curriculum. Thus, whilst both the Korean and Japanese Constitutions refer to International Law in different degrees this constitutionally enshrined respect and recognition of International Law needs to be reinforced through its compulsory study in law schools and for Bar exams, so that future generations of lawyers and judges have an early and at least basic foundation in it. Many jurisdictions in the world do not have International Law as a compulsory subject, but this is not reason why this should be the case in NEA. Moreover, the curriculum should include Japanese, Korean and Chinese perspectives on questions of International Law within the universities in NEA respectively. Third, the media in all three countries should be free and independent with access to all sources within NEA. This is important so that discourse with respect to inter-se relations is in the light of all the information and analysis. Of late there has been much ado about outside interference in domestic elections in the US. However, leaving aside illegal interference, since electioneering can often involve inter-se relations on the election agenda, there is a case for a balanced media at this time, wherein neighbour perspectives and responses to domestic discourse are included in media coverage. Fourth, effective national legislation on racial discrimination in NEA is important generally and particularly as it affects NEA nationals and their activities within NEA. Fifth, consenting to the jurisdiction of the International Court of Justice, the International Tribunal for the Law of the Sea and the ­International Criminal Court must be informed through a transparent and democratic process. Finally, there is the need for constitutional changes ensuring entrenchment of I­ nternational Law

Introduction 3

in the domestic legal systems. In this respect the Korean Constitution is exemplary although it could do with some clarifications. The Chinese Constitution needs to be amended to unblock its insulation of International Law from the domestic sphere. The more porous and receptive the domestic legal system is to International Law, the more likely will it be that inter-State tensions will become less politicised at the State to State levels, devolving to the domestic judicial sphere. Here too the fact that this may not be the case in all Constitutions of States is not reason for changes not to be brought in NEA. This work is not a substitute for a basic text book in International Law.1 The objectives of the work are to focus on some key preoccupations in NEA inter-se from the perspective of International Law, in particular to engender a contextualised discourse of International Law in NEA. Context here has several meanings and functions. It involves contextualising International Law to the particular circumstances. For example, the principles of estoppel and acquiescence need to be interpreted taking into account cultural reflexes and inhibitions in the manner of responding to international relations. It involves enabling the circumstances to inform the development of International Law—for instance, the inculcation of rectificatory justice in the development of International Law; the shaping of the doctrine of inter-temporal law; and the clarification of rules on State succession in the event of a Korean unification. It calls for a discourse on International Law that is relevant to the circumstances. For example, a discourse on the sources of International Law invites the query as to whether the NEA State practices are sufficiently transparent and documented, such that they could contribute to the practice of States in the development of Customary International Law. Thus, ­Japanese judicial practice as it relates to questions of International Law is not available in English; whilst the Chinese Foreign Ministry is somewhat opaquer in terms of Chinese State practice than the other States. Finally, it involves engaging in International Law from the perspective of a region. It requires consideration of building regional institutions and focusing on regional issues so that, for example, International Law deliberations on regional conflicts can be facilitated at a regional level. The importance of such an approach lies in the insights it provides to the adaptations in International Law to regional circumstances, or for that matter its limits in its adaptability; in the insights into relevant historical background of the region for a proper application of International Law; and in an understanding of the way NEA States respond to the International Law cues. Moreover, contextualising

1  For standard textbooks see national text books in International Law for example from China: Jia Bingbing, Public International Law: Its Interpretation and Application in Time of Peace (Beijing, ­Tsinghua University Press, 2015) (in Chinese); Korea: Dae Soon Kim, Theory of International Law 17th edn (Seoul, Samyoungsa, 2013) (in Korean); and Japan: Koichi Seiji and Atsuko Kanehara (eds), The Practice of International Law 2nd edn (Tokyo, Shinzansha, 2013) (in Japanese). For more contextualised works see Onuma Yasuaki, International Law in a Transcivilizational World (Cambridge, CUP, 2017) and Seokwoo Lee and Hee Eun Lee, The Making of International Law in Korea: From Colony to Asian Power (Leiden, Brill-Nijhoff, 2016) (there are no footnotes in this work). For standard westcentric works see for example I Brownlie, Principles of Public International Law (Oxford, OUP).

4  Introduction

partakes of justice. Historically entrenched conflicts call for rectificatory justice. International Law implanted in the domestic legal systems is domestically contextualised International Law, and therefore can be more just. Regional conflicts rooted in history that are difficult to reconcile in the current state of International Law and affairs, raise the important and difficult question whether successive generations should be burdened with historic disputes. In other words, there has to be, to borrow an environmental concept, a ‘sustainable’ approach to ­justice. ‘­Sustainable justice’ is as much about ensuring justice for current and future generations, as it is about not crippling future generations with the burdens of pursuing justice as it affects current generations. In the same vein, international monetary and trade issues raise ethical questions concerned with justice when considered in a regional context, although to some extent such concerns are also present generally. Or at the least when these issues are focussed in a regional context ethical questions become clearer. This work first sets out the theoretical aspects of contextualising International Law in the Northeast Asian matrix, prefaced by the leitmotif ‘International Law not grounded in its context is set to wither.’ This is followed by a discourse titled ‘Challenging Approaches to the Application of International Law in the Historical Setting of Northeast Asia.’ This chapter provides in outline form the historical emergence and development of International Law in NEA, and critically focuses on the International Law principles that have crystallised to form the lenses through which historical events are evaluated in International Law. The third chapter sheds light on how International Law has been received in the domestic legal systems in NEA, with the theme and aspiration of regional peace and harmonisation through the rule of International Law in the domestic legal systems. Chapter four examines some key historically underpinned disputes in NEA, focusing on maritime and territorial disputes; Comfort Women and denuclearisation in the Korean peninsula. This overview of historically rooted conflicts is underlined by the importance of establishing a common understanding of past injustices. Chapters five and six focus on the economic developments in the region that have thrust it to the forefront of international affairs. Chapter five comprises of an exploration of regional monetary integration, underlined by the observation that whilst monetary policy may be at the epicentre of State sovereignty it is also at the heart of good neighbourly relations. Finally, in chapter six the terrain of international cooperation in the sphere of trade and investment through free trade agreements is set out, but with the note of caution that a State’s freedom to discriminate in international trade is no longer absolute and cannot be so—a reminder that with economic ­success comes also responsibilities.

Part One

Theory and Fundamental Themes

6 

1 Contextualising International Law in the North East Asian Matrix1 ‘International Law not grounded in its context is set to wither!’ Asif H Qureshi

I. Introduction Contemporary North East Asia (NEA) is simmering in territorial and maritime tensions, in historical claims and arguments but also in overtures of assimilation and cooperation. The emotive layer of NEA is also informed by the economic development that has embraced the region, and the promise that it portends. International Law that can arbitrate in this simmer, International Law that can further development in this development, has to be contextualised in the North East Asian matrix. North East Asia comprises in the sense of its common2 description of China, Korea and Japan. This description is not necessarily a neutral self-evident geographical encapsulation of the region. For instance, it does not include Russia and Mongolia, both of which may be said to have a presence in the region. Russia’s absence may be explained by the racial difference in its population and generally its Janus-faced mass that straddles Europe, central Asia and NEA. Mongolia on the other hand may be considered ethnically relatively closer to the population in the NEA, although arguably it is located more in central Asia than in NEA. That said the same could be said of China whose significant mass is in central Asia. Exclusive geographical presence in the north-eastern region is thus not a condition. The description NEA therefore is not completely set in geography. It is a combination of geography and common racial, cultural, linguistic, religious and historic heritage that configures in the description. Certainly, common ­Western

1 

This chapter is based on an article published in the (2016) 6(2) KLRI Journal of Law and Legislation.

2 http://en.wikipedia.org/wiki/Northeast_Asia.

8  Contextualising International Law

conceptions of the region are often less discerning, grouping North East Asia into the wider ‘Far East’. However, there is no juridical description of the region as such, although it is to be noted that the UN Economic and Social Commission for Asia and the Pacific has a specific focus on North East Asia qua North East Asia, including a sub regional office for East and North-East Asia located in Korea.3 This UN focus on the region however also embraces Mongolia and Russia, with a specific development-oriented integration agenda. Perhaps a more relevant, although not complete, reinforcement of the concept of NEA, is to be found in the Trilateral Cooperation Secretariat (TCS), an international organisation set up in 2011, as between China, Korea and Japan—‘established with a vision to promote peace and common prosperity among the People’s Republic of China (China), Japan, and the Republic of Korea (ROK/South Korea).’4 In this vision though, the Democratic People’s Republic of Korea and Republic of China (Taiwan),5 are excluded, presumably on political grounds. In sum, given that the common ­geography and heritage of the region is marred by historic conflicts, including some spatial ambivalence as to its contours—the commonly held description ‘North East Asia’ is in essence a political aspiration in NEA for some form of regional solidarity. Individually the countries in North East Asia are now important economic powerhouses. But collectively they can be even more formidable. Politically the three are important players in international decision-making respectively, but could be very significant with a common agenda. Historically the three have been intertwined through conquests, divisions and disputes. These have been politically internally driven and have become historically entrenched. More­ over, the divisions have also been externally influenced. For example, US foreign policy in the region is constructed within the context of the balance of power within NEA. This external influence may be considered benign or negative, depending on the standpoint of the observer, in terms of the development of the integrity of the region. Be that as it may the fact remains that racially, culturally and in religious terms the three share a wealth of common ground for further social and cultural associations. Geographically there is a unity that underlines environmental, and in some measure economic, interdependence. There is thus in this geographic proximity a sense of promise, commonality and interaction. In sum, the NEA matrix is an internal inter-se construct the borders of which have been externally reinforced. This construct calls for solidarity or at the least peaceful co-existence. In this regional milieu therefore, an enquiry into the setting of International Law and its role in the region has much to commend it—as an ‘arbitrator’, as a

3 

See http://northeast-sro.unescap.org/about.html. See http://www.tcs-asia.org/dnb/user/userpage.php?lpage=1_1_overview. I am grateful to Professor Toyoda Tetsuya of Akita International University, Japan for drawing my attention to the absence of Taiwan. 4  5 

Introduction 9

­ ormative force, and as a facilitator—indeed as a vehicle for the external impact n of the region. More importantly an effective and justice-oriented role for International Law in its application to the States in NEA individually, as well as in the foreign relations inter-se of the States in NEA, necessitates a regional contextualisation of International Law. This need for the regional contextualisation of International Law is relatively more pressing with respect to relations inter-se the States in NEA than the role of International Law with respect to the States in NEA respectively. Of course, the dynamics of the inter-se relations in NEA trigger the application of International Law but more significantly fuel the need for an International Law that is contextualised to the exigencies of the region. Moreover, the practice inter-se may inform the existence of local Customary International Law as a facet of a contextualised consideration of International Law. The value and policy rationale for contextualising International Law in a regional setting are varied. First, as has been pointed out: [C]loseness to context better reflects the interests and consent of the relevant parties. As a matter of legal policy, it may often be more efficient to proceed by way of taking a regional approach. Both human rights and economic integration constitute examples of this type of reasoning.6

This is a stand-point concerned with enforcement/implementation as much as participation in the development of International Law. Second, if regionalism is the ‘natural tendency of development from States to larger units of international government’7 then International Law has to respond to that development. Third, just as the necessity for law is inherent to the existence of societies, the necessity for International Law is inherent in the existence of an international society— including regional ensembles of its constituents. Fourth, if as has been asserted ‘International Law and international politics cohabit the same conceptual space’8 the political space that regions occupy have a relevance to the development of International Law.9 Fifth, justice calls for the formulation and application of law in a contextualised manner. Thus, it is a central tenet of equity that differently circumstanced entities should be accorded different treatment.10 In the same vein, Rawls’s differential principle11 is but an illustration of contextualising law—the rational individual behind the veil of ignorance displacing the notion of ‘one size fit for all.’ Finally, given the perception often of the equation of universalism with Western cannons of jurisprudence there is indeed a need to take into

6 

UN Study on Fragmentation in International Law—see ILC A/CN.4/L.682 para 206.

7 ibid. 8 

Ann-Marie Slaughter, ‘International Law in a World of Liberal States’ (1995) 6 EJIL 503—38, 503. See also M Koskenniemi, The Politics of International Law (Oxford, Hart Publishing, 2011). 10  See also Lon L Fuller Anatomy of the Law (New York, Praeger, 1968) 94 wherein he states ‘Since no two cases are ever exactly alike, one cannot act justly unless one is able to define what constitutes an essential likeness’. 11  John Rawls, Theory of Justice revised edn (Cambridge MA, Belknap Press, 1999). 9 

10  Contextualising International Law

account other legal traditions.12 Thus, in order to respond to the ‘multi-polar and multi-civilizational reality of the twenty first century’, Onuma Yasuaki calls for the need to develop ‘a cognitive and evaluative framework based on the recognition of plurality of civilizations and cultures that have long existed in human history.’13 However, the contextual approach adopted here, whilst recognising the value of taking an open minded and inclusive normative approach, does not necessarily partake of the advancement of a particular normative approach to International Law, although the consequence of its application may so result. The contextual approach focusses both on norm creation as well as its implementation; and it is more closely aligned to the necessary adaptation of the law for a just and efficient result rather than a tool for the advocacy of a particular substantive perspective on the development of International Law. The discourse on relativism in International Law, which also partakes of contextualisation in International Law, has in some measure a particular relevance to the application of International Law to the individual States in NEA. However, the purpose of this context-based focus of International Law in NEA is not to engage in the discourse on relativism in International Law as such. Rather, whilst recognising that there may be echoes of relativism in this focus, and without prejudice to the arguments for and against relativism in International Law as such, the following specific observations are proffered. First, to the extent that there may be echoes of relativism in this focus, the relativism advanced is diluted. Second, the arguments advanced here are not policy based viz, whether relativism is apposite in a regional context but rather that contextualism is anchored in the very nature of law, positivism and the architecture of the international legal system. Third, whereas a central pillar of the discourse on relativism is set in human rights, the focus of ‘contextualism’ in International Law herein is general. Finally, to the extent that there are traces of relativism herein, relativism on a regional setting has more of a chorus of claimants in its favour than relativism on a State basis—the contextual focus here is located in a regional, as opposed to a State setting. The case for a NEA-specific contextualisation of International Law is but an instance of the wider question of the nature of the relationship between ­International Law and regionalism, the nature of the integrity of International Law outside a contextual setting, and contextualisation in International Law as a process of justice and its efficient application. In this vein, this chapter outlines the theoretical foundations for a contextualised focus on the role of International Law in NEA. To this end first the normative basis of regionalism is explored. This is followed by a focus highlighting how in different ways International Law operates in a contextualised manner drawing mainly from the practice of the International

12  See Onuma Yasuaki, A Transcivilizational Perspective on International Law 9 Pocketbooks of the Hague Academy of International Law, (Leiden, Martinus Nijhoff, 2010); and William Twining, General Jurisprudence—Understanding Law from a global perspective (Cambridge, CUP, 2009). 13  Yasuaki, ibid 81 and 107.

Does Regionalism have a Normative Basis in International Law? 11

Court of Justice (ICJ). In the final section some brief observations are proffered with respect to the contextualisation of International Law in practice.

II.  Does Regionalism have a Normative Basis in International Law? There is a dearth of legal analysis of International Law from a regional ­perspective14—although doubtless if regionalism is equated with civilisations then Onuma Yasuaki’s work has much to offer.15 In particular, the building blocks of International Law have not been considered adequately qua regional blocs. The ­discourse on the nature and development of International Law has not been located within a regional setting. It has not been sufficiently analysed in the consideration of the origins and development of International Law. However, the subject has featured in the discourse on the phenomenon of fragmentation in International Law;16 in terms of the European contribution to International Law;17 in terms of an ideological stand-point assimilated from a regional setting, for example communism in the Soviet era,18 or Third World approaches to International Law;19 in terms of international governance viz regionalism or multilateralism;20 and in terms of regional consciousness in the representative regional works,21 or regional State practice. None of these perspectives however directly engage in a theoretical discourse of International Law from a regional perspective as such. There are several reasons for this. First, traditionally the basic unit of International Law has been the State and therefore, despite contemporary developments in International Law in e­ mbracing

14  A sentiment echoed also in the UN Study on Fragmentation in International Law—see ILC A/ CN.4/L.682: para 195. However, it is to be noted that in the context of fragmentation in International Law the discourse on regionalism provided by the UN Study on Fragmentation of International Law is quite comprehensive. 15  See for example Yasuaki, above n 12. 16 ibid. 17  See the regular survey of the international practice of the European Union in the European Journal of International Law; Peter Hay ‘The Contribution of the European Communities to ­ ­International Law’ Proceedings of the American Society of International Law at Its Annual Meeting (1921–1969) (1965) 59, Development of International Law by International Organizations 195–201; M Koskenniemi, ‘International Law in Europe: Between Tradition and Renewal’ (2005) 16(1) EJIL 113–24; A ­Orakhelashvili, ‘The Idea of European International Law’ (2006) 17(2) EJIL 315–47. 18  GI Tunkin, Theory of International Law (Cambridge MA, Harvard University Press, 1974). 19  Richard Falk, Balakrishnan Rajagopal and Jacqueline Stevens (eds), International Law and the Third World: Reshaping Justice (Abingdon, Routledge, 2008). 20  Both in trade law and political economy. See for example J Bhagwati, Termites in the Trading System (Oxford, OUP, 2008). 21  For example, Liliana Obregon, ‘Latin American International Law’ in David Armstrong (ed), Handbook of International Law (Abingdon, Routledge, 2011).

12  Contextualising International Law

new types of subjects, for example international organisations and individuals, discourse on International Law is and has been essentially focussed on the State. Thus, generally regions as such have not been the measure for discerning either the origins of International Law or the practice of International Law. This is despite the fact that much of State practice historically originated in geographical proximity, since the extent of foreign relations were geographically informed. In the same vein, contemporary multilevel analysis of International Law22 has been underpinned by a human rights approach. However, it has not taken the regional dimension specifically as such, as a level for its approach to International Law, even though the development of human rights including conceptions of human rights have a regional setting—including such a setting prior to becoming universalised. Second, a regional perspective of International Law has been understood as undermining the notion of the ‘universality’ of International Law. In this debate regionalism is positioned in contradistinction to the universal validity of International Law. This discourse has both a European historical setting, as well as a modern one. In the historical European context, the idea of a ‘European International Law’ with European Christian values and applicable only as between the ‘civilised’ European States, was developed in the nineteenth century essentially through European classical writings.23 This claim of an International Law confined essentially to the European region has been contrasted with the notion of a universal International Law based both on natural law precepts dating back as long ago as the seventh century; and the actual practice of International Law both within and outside Europe.24

22 See Ernst-Ulrich Petersmann, Human Rights Require ‘Cosmopolitan Constitutionalism’ and ­ osmopolitan Law for Democratic Governance of Public Goods EUI Working Papers LAW 2013/04, C ­available at http://cadmus.eui.eu/bitstream/handle/1814/27155/LAW_2013_04.pdf?sequence=1. 23  Orakhelashvili, above n 17. 24 Orakhelashvili, ibid. Elsewhere in the same contribution he states at 317: ‘The idea that International Law had a specifically European character was most actively and fully developed in and around the 19th century. It became conventional wisdom that International Law developed through ­European treaties and customs, and that non-European countries did not participate in its development. This approach contradicts the classic conception of the universal law of nations’. 325: C ­ oncludes—‘The proponents of European International Law based their views not on empirical evidence, but on the assumptions and prejudices of racial, cultural and religious superiority of Europeans over n ­ on-­Europeans. … The idea of European International Law was part of the ideology of colonialism. Colonial expansion and exploitation found no explanation in the classical law of nations, which embodied the principles of universality and uniformity and recognized the equality of nations … And at 328: ‘The thesis put forward by the proponents of European International Law that non Europeans were incapable of understanding International Law was based on pure prejudice. Their writings ignored the fact that the cultural and intellectual heritage of non-European nations had long embraced and developed fundamental ideas of International Law. Kautilya’s Arthasastra and the Code of Manu, to mention only a couple of examples, provide evidence of non-European concepts of the sanctity of treaties, inviobality of ambassadors, principles of humanity in conducting wars and fundamental principles of the law of the sea … .’ At 329: ‘The practical side of history demonstrates that International Law has been as Asian or African as it has been European. The first instruments and institutions of International Law identified to date originate outside Europe.’ At 333: ‘All this evidence

Does Regionalism have a Normative Basis in International Law? 13

This debunking of the idea of a ‘European International Law’ focuses on the ‘European’ claim qua Europe with reference to a universal International Law. It is not intended however as an elucidation of the nature of International Law as such from a regional dimension. It does however touch upon the question of the very relevance of the existence of different regions, including NEA, in terms of International Law. A somewhat similar discourse focusing on contemporary regional State practice is to be found in the evaluation of the contribution of different regions to the development of modern International Law, and their characteristics in terms of that International Law. Thus, Gillian Triggs observes: ‘A review of the literature and state practice suggests that states in the Asian Pacific have played little role in the development of modern International Law,.’25 The characteristics of the Asian Pacific Region contributing to this conclusion are described as follows: —— a preference for consultation and consensus decision-making and good neighbourly relations; —— a dislike of confrontational/adversarial litigation of disputes, particularly third party dispute resolution before a court or tribunal; —— a preference for conflict avoidance mechanisms demonstrated by a trend towards workshops, joint management and development regimes’ cooperation agreements and ‘track-two’ diplomacy as a means for resolving disputes; —— a community and social welfare orientation to human rights issues; —— a strong emphasis on economic priorities in law-making and foreign policy.26

A similar analysis has led Simon Chesterman to describe Asia’s attitude towards International Law as being ambivalent.27 He observes that Asian States have not engaged with International Law and international institutions as they might. Thus, he asserts there are no significant regional organisations in Asia. Moreover, Asian States prefer bilateral relations and have not cooperated in orchestrating a common policy stand in international institutions—although Asian involvement in economic regimes has been different. The reasons for the lack of engagement in International Law and institutions are attributed to the negative experience that historically Asian States had with International Law under which they s­uffered

suggests that no specifically ­European International Law has ever existed: it was merely constructed in doctrinal writings by reference to extra-legal factors and circumstances which never possessed any practical ­significance in inter-state relations.’ ‘International Law was never restricted to Europe. It was a secular law and its essential norms emerged as universally valid norms.’ ‘… a single universal law of nations applied both to European and non-European nations in their intercourse from the 16th century.’ See also M Koskenniemi, above n 9, 222. 25  G Triggs, ‘Confucius and Consensus: International Law in the Asian Pacific’ (1997) 21 Melbourne University Law Review 650, 651. 26  ibid, 675. 27 See Simon Chesterman, ‘Asia’s Ambivalence About International Law and Institutions: Past, ­Present, and Futures’ (2017) http://legal.un.org/avl/ls/Chesterman_IL_video_1.html.

14  Contextualising International Law

from colonialism and unequal treaties; diversity in the States’ political systems and outlook; and the lack of incentives for a more proactive engagement in international institutions. Both Simon Chesterman and Gillian Triggs offer a discernment of regional features and practices that are no doubt of value. Such a perspective however is a focus on the region from an external vantage removed from the region and set against the ‘modern’ model of universal International Law. In the same vein, within the regional settings there is growing awareness and discourse on regional importance, as for example the setting up of societies of International Law (for example, the Asian Society of International Law); edited monographs that focus on regional challenges from the stand-point of International Law (for example boundary disputes);28 including works on sub-sets of disciplines within International Law, as for example Human Rights and Environmental Law.29 It will be noted however that in some senses Societies of International Law promote a particular regional perspective on International Law within the ‘universal paradigm’ of International Law; as do the edited volumes. Moreover, the focus on sub-sets of disciplines tends to be mainly from a positivist practitioner’s perspective. Third, the focus of international legal analysis on regionalism such as it is, is mainly set in Western legal discourse, with a Euro-centric preoccupation, with much of the rest of the world taking its cue largely from this international legal scholarship, as given. Thus, analysts from NEA have repeatedly referred to the characteristics of the original International Law inherited in the region as partaking of ‘Christian’ values.30 For example it has been observed: ‘So it was national survival, not Korea’s appreciation of Judaeo-Christian precepts embodied in the Western law of nations that induced Yi Korea to assimilate International Law to the extent that it did.’31 To some extent this is understandable since the original inception of modern International Law into NEA was through the translations of the writing of Henry Wheaton.32 His writings form the basis of the characterisation of the modern International Law originally introduced in NEA as partaking

28  Xue Hanqin, ‘Chinese Perspectives on International Law: History, Culture and International Law’ (2011) 355 Recueil Des Cours; Nisuke Ando, Japan and International Law. Past, Present and Future: international symposium to mark the centennial of the Japanese Association of International Law (Boston, Kluwer Law International, 1999); Seokwoo Lee and Hee Eun Lee (eds), Northeast Asian Perspectives on International Law: Contemporary Issues and Challenges (Leiden, Martinus Nijhoff Publishers, 2013). 29 For example, Michael G Faure and Song Ying (eds), China and International Environmental ­Liability Legal Remedies for Transboundary Pollution (Cheltenham, Edward Elgar, 2008). 30  See for example, Eric Yong-Joong Lee, ‘Early development of Modern International Law in East Asia—With Special Reference to China, Japan and Korea.’ (2002) 4 Journal of the History of ­International Law 42; Nam-Yearl Chai, ‘Korea’s Reception and Development of International Law’ in Jae Schick Pae et al, Korean International Law (Oakland, University of California, 1981) 20 and 25. 31  Chai, ibid 20. 32  Henry Wheaton, Elements of International Law 6th edn (Boston, Brown & Co, 1855) translated by WEP Martin an American missionary visiting China in 1863, as observed amongst others by ­Yong-Joong Lee, above n 31, 46. See also R Svarverud, International Law as World Order in Late Imperial China: Translation, Reception and Discourse, 1847–1911 (Leiden, Brill, 2007) ch 3.

Does Regionalism have a Normative Basis in International Law? 15

of Christian values; and echoed still in contemporary writings. Indeed, William AP Martin in 1864 wrote, albeit in English in his preface to his translation into Chinese of Wheaton’s book: ‘International Law in its present form is the mature fruit of Christian civilisation. It springs, however, spontaneously from the intercourse of nations …’33 However, as Orakhelashvili points out, Wheaton was one of those writers who advanced the idea of ‘European International Law’ fit for the Christian civilised world only, and denied the existence of any form of a universal International Law.34 Such writings Orakhelashvili rightly points out were not based on evidence but on prejudice and that in fact International Law was secular and universal.35 In sum, the circumstances when regionalism is considered have been described as involving ‘the question of the universality of International Law, its historical development or the varying influences behind its substantive parts.’36 Thus, the discourse in terms of the European dimension, as has been pointed out, is not so much about regionalism qua Europe and International Law but more in terms of the historical development of International Law, the contribution of Europe to International Law, and the assimilation of International Law with European ­values and ‘European International Law.’ Similarly, general discourse on ‘regionalism versus universalism’ focuses on the merits or otherwise of regional governance to the development of the world order, thus proffering an elucidation that is essentially utilitarian, as opposed to doctrinal in terms of the nature of International Law. Moreover, the conclusion even in terms of a utilitarian approach is not clear. Thus, it has been observed albeit in the context of international organisations that the ‘complex interplay of regional and universal elements … p ­ ermits few ­generalizations.’37 Indeed, that there is ‘no inherent superiority in either regionalism or universalism.’38 In the same vein, efforts to deconstruct the universality of International Law and its origins39 skew the focus on regionalism from the perspective of universalism. In fact, the closest deliberation is the observation by the ILC viz: ‘If regionalism itself is not automatically of normative import, its ­significance is highlighted as it mixes with functional differentiation.’40 The former part of the observation leaves in some measure the question of the normative import of regionalism open, which is to be welcomed. All states

33 

Quote taken from Svarverud, ibid 98. See Orakhelashvili, above n 17, 318. 35  See Orakhelashvili, ibid 325 and 333 and 328. See also Koskenniemi, above n 17, 347. 36  UN Study on Fragmentation in International Law—see ILC A/CN.4/L.682 para 195. 37  See for example R Falk, ‘Regional and World Order After the Cold War’ (1995) 49(1) Australian Journal of International Affairs; C Schreuer, ‘Regionalism v. Universalism’ (1995) 6 EJIL 477. 38  Schreuer, ibid 477. 39  B Simma, ‘Universality of International Law from the Perspective of a Practitioner’ (2009) 20(2) EJIL 265–97; E Jouannet, ‘Universalism and Imperialism: The True-False Paradox of International Law?’ (2007) 18(3) EJIL 379–407; A Bradford and EA Posner, ‘Universal Exceptionalism in I­ nternational Law’ (2011) 52 Harvard International Law Journal 1. 40  UN Study on Fragmentation in International Law—see ILC A/CN.4/L.682 para 204 (emphasis added). 34 

16  Contextualising International Law

of learning and advanced approaches to knowledge leave doors open for possible argumentation. However, further on in the ILC report the conclusion is somewhat dismissive: In fact there is very little support for the suggestion that regionalism would have a normative basis on anything else apart from regional customary behaviour, accompanied, of course, with the required opinio juris on the part of the relevant States.41

This is somewhat incorrect. The evidence is not so much that there is little support but rather that the focus as such simply has not been there inter alia for the reasons explained already. Another close encounter of the normative import of regionalism is to be found in a reference by Bruno Simma when he describes different possible conceptions of universalism: At a second level a—wider—understanding of universality responds to the question whether International Law can be perceived as constituting an organized whole, a coherent legal system, or whether it remains no more than a ‘bric-a-brac’, to use Jean Combacau’s expression—a random collection of norms, or webs of norms, with little interconnection.42

This ‘bric-a-brac’ description of International Law gives regions a different normative foundation. Regional systems acquire a normative pari pasu status. In fact, the origins of International Law are not set in the advent per se of the institution of the State. Thus, a hermit State or indeed a group of hermit States have little to contribute to the development of International Law absent relations as between these States. Rather, the origins of International Law are coterminous with relations as between States. Historically relations as between States (including entities like States) emerged within a region as between proximately located States (including entities like States). Subsequently, relations as between States within regions formed, and ‘International Law’ evolved against this background. And in this process the regions did not surely wither. The relations within the region amongst the States of the region in differing degrees continued. Indeed, where common goals are best achieved regionally, functionally specific regional frameworks have and are evolving for instance in the trade and monetary spheres. Moreover, States within regions engaged in the development of International Law multilaterally do not just take to this forum their national perspectives but also surely have an eye on the regional implications of their deliberations internationally. This may as much be a regional perspective or one that distorts it. But even in the latter case it originates from a regional setting. In sum, regions therefore had a normative basis in the historical development of International Law; continue to have a normative basis to the extent that that basis has not been displaced by a universal system of law; have a normative basis

41  42 

UN Study on Fragmentation in International Law—see ILC A/CN.4/L.682 para 215. Simma, above n 40.

Contextualising International Law 17

in the future development of International Law, including in the building of new regional utilitarian based normative frameworks. The nature of International Law is not discernible through the dogma of a universalist paradigm alone—which approach is emotive, aspirational and distortive of the way in which International Law needs to be engaged in. The reality in international relations is that International Law partakes of a ‘bric-a-brac’ setting, to borrow a description—of building and interacting blocs, of varying units of measure and force. Such an analysis is confirmed and reinforced by the contextual nature of International Law as set out below.

III.  Contextualising International Law Context here is used widely to describe the elements that inform the scope and ­content of a norm without which the norm could be too wide, too narrow, too rigid—indeed could lead to absurd senses. As such ‘context’ is built in the very anatomy of International Law.43 Indeed context approximates to what Lon Fuller described in his Anatomy of Law in a more general manner as the ‘implicit ­elements’ in law, and which can partake of elements that are in a sense extraneous to it.44 At a micro normative level context serves to place an interpretation on an international norm and is internal to it. The internal aspects that inform the context may be set within the norm, or partake of the circumstances involved in the creation of the norm. However, context can also be constructed on to a norm from an external vantage imbuing it with a certain meaning. Such a context may be said to have an external dimension normally deriving from a macro normative framework, or extraneous in the sense that the normative scope is informed by the relevant facts. Whatever the locus of the context however context is inherent to a norm. Context exists in the very nature of law and International Law, particularly if law is defined as a process of decision-making.45 Law as a process operates within a wider contextual framework and indeed emphasises context. Moreover, contextualisation is an imperative in the process of interpreting a norm. Interpretation involves contextualisation and contextualisation itself can partake of interpretation. However, the two are conceptually distinct although related. ‘Interpretation’ stricto sensu located in a spectrum of its meaning is closer

43 

Fuller, above n 10, does not focus on context in law as such. ibid at 57 ‘The interpretation of statutes is, then not simply a process of drawing out of the statute what its maker put into it but is also in part, and in varying degrees, a process of adjusting the statute to the implicit demands and values of the society to which it is to be applied. In this sense it may be said that no enacted law ever comes from its legislator wholly and fully “made”.’ See also at 69. 45  See WM Reisman, ‘International Law Making: A Process of Communication’ (1981) 75 American Society of International Law Proceedings 101; R Higgins Problems and Process: International Law and How We Use It (Oxford, OUP, 1995). 44  Fuller,

18  Contextualising International Law

to the source of the law whereas context may be said to be at the other end of it closer to ‘the implicit demands and values of the society to which it is to be applied.’46 This difference is illustrated in the Advisory Opinion of the ICJ in the Legality of the Threat or Use of Nuclear Weapons, when the court was establishing the contextual scope of international humanitarian law and the law on armed conflicts in relation to ‘the threat or use of nuclear weapons’. The court observed as follows: 86. … Indeed, nuclear weapons were invented after most of the principles and rules of humanitarian law applicable in armed conflict had already come into existence; the Conferences of 1949 and 1974–1977 left these weapons aside, and there is a qualitative as well as quantitative difference between nuclear weapons and all conventional arms. However. it cannot be concluded from this that the established principles and rules of humanitarian law applicable in armed conflict did not apply to nuclear weapons. Such a conclusion would be incompatible with the intrinsically humanitarian character of the legal principles in question which permeates the entire law of armed conflict and applies to all forms of warfare and to all kinds of weapons, those of the past, those of the present and those of the future. In this respect it seems significant that the thesis that the rules of humanitarian law do not apply to the new weaponry, because of the newness of the latter, has not been advocated in the present proceedings. On the contrary, the newness of nuclear weapons has been expressly rejected as an argument against the application to them of international humanitarian law: ‘In general, international humanitarian law bears on the threat or use of nuclear weapons as it does of other weapons. International humanitarian law has evolved to meet contemporary circumstances, and is not limited in its application to weaponry of an earlier time. The fundamental principles of this law endure: to mitigate and circumscribe the cruelty of war for humanitarian reasons.’ (New Zealand, Written Statement, p 15, paras 63–64.) 90. Although the applicability of the principles and rules of humanitarian law and of the principle of neutrality to nuclear weapons is hardly disputed, the conclusions to be drawn from this applicability are, on the other hand, controversial. 91. According to one point of view, the fact that recourse to nuclear weapons is subject to and regulated by the law of armed conflict does not necessarily mean that such recourse is as such prohibited. 92. Another view holds that recourse to nuclear weapons could never be compatible with the principles and rules of humanitarian law and is therefore prohibited. In the event of their use, nuclear weapons would in all circumstances be unable to draw any distinction between the civilian population and combatants, or between civilian objects and military objectives, and their effects, largely uncontrollable, could not be restricted, either in time or in space, to lawful military targets. Such weapons would kill and destroy in a necessarily indiscriminate manner, on account of the blast, heat and radiation occasioned by the nuclear explosion and the effects induced; and the number of casualties which would ensue would be enormous. The use of nuclear weapons would therefore be prohibited in

46 

Fuller, above n 10, 57.

Contextualising International Law 19 any circumstance, notwithstanding the absence of any explicit conventional prohibition. That view lay at the basis of the assertions by certain States before the Court that nuclear weapons are by their nature illegal under customary International Law, by virtue of the fundamental principle of humanity.47

Thus, the Court unanimously agreed on the context for the disciplines on nuclear weapons viz, threat or use of nuclear weapons should also be compatible with the requirements of the International Law applicable in armed conflict, particularly those of the principles and rules of international humanitarian law, as well as with specific obligations under treaties and other undertakings which expressly deal with nuclear Weapons.48

However, the court could not agree unanimously on the actual interpretation of the law on armed conflicts and international humanitarian law to nuclear weapons. This is because there was room for disagreement on actual interpretation of the relevant norms in the context disciplines. It deliberated on this as follows: E. By seven votes to seven, by the President’s casting vote, It follows from the above-mentioned requirements that the threat or use of nuclear weapons would generally be contrary to the rules of International Law applicable in armed conflict, and in particular the principles and rules of humanitarian law; However, in view of the current state of International Law, and of the elements of fact at its disposal, the Court cannot conclude definitively whether the threat or use of nuclear weapons would be lawful or unlawful in an extreme circumstance of self-defence, in which the very survival of a State would be at stake …49

Context in the anatomy of International Law is to the found variously, and through different mechanisms. First, it is set in the requirement of ‘good faith’ which is ubiquitous in International Law. Good faith helps in managing context to the limits of its intended and reasonable scope. Thus, in the Legality of Threat or Use of Nuclear Weapons the ICJ pointed out: ‘One of the basic principles governing the creation and performance of legal obligations, whatever their source, is the principle of good faith.’50 Second, context is specifically embellished in the anatomy of all the major sources of International Law. First and foremost, context features prominently in the interpretation and implementation of treaty obligations. Thus, as is well appreciated Article 31 and 32 of the Vienna Convention on the Law of Treaties 1969 (VCLT) specifically require the interpretation to be in ‘good faith’ whilst taking into account a range of considerations that describe the relevant context. Indeed, context of a treaty in the general sense of ‘context’ is described in

47 

Legality of the Threat or Use of Nuclear Weapons Advisory Opinion (ICJ: 1996). Para 105 (2) (D). Para 105 (2) (E). 50  Legality of the Threat or Use of Nuclear Weapons ICJ Advisory Opinion (1996) para 102. 48  49 

20  Contextualising International Law

Articles 31–32 of VCLT extensively.51 In the same vein, UN Security Council Resolutions have a somewhat similar contextual framework to their interpretative process as treaties. Thus, the ICJ has observed: Before continuing further, the Court must recall several factors relevant in the interpretation of resolutions of the Security Council. While the rules on treaty interpretation embodied in Articles 31 and 32 of the Vienna Convention on the Law of Treaties may provide guidance, differences between Security Council resolutions and treaties mean that the interpretation of Security Council resolutions also require that other factors be taken into account. Security Council resolutions are issued by a single, collective body and are drafted through a very different process than that used for the conclusion of a treaty. Security Council resolutions are the product of a voting process as provided for in Article 27 of the Charter, and the final text of such resolutions represents the view of the Security Council as a body. Moreover, Security Council resolutions can be binding on all Member States (Legal Consequences for States of the Continued Presence of South Africa in Namibia (South West Africa) notwithstanding Security Council Resolution 276 (1970), Advisory Opinion, ICJ Reports 1971, p 54, para 116), irrespective of whether they played any part in their formulation. The interpretation of Security Council resolutions may require the Court to analyse statements by representatives of members of the ­Security Council made at the time of their adoption, other resolutions of the Security Council on the same issue, as well as the subsequent practice of relevant United Nations organs and of States affected by those given resolutions.52

Furthermore, the requirement of good faith in the interpretative process is reinforced in the performance of the treaty under Article 26 VCLT. Second, context in the anatomy of Customary International Law (CIL) is certainly present, if not readily evident. CIL is in some senses inherently contextual in

51 

Art 31 of VCLT: 1. A treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose. 2. The context for the purpose of the interpretation of a treaty shall comprise, in addition to the text, including its preamble and annexes: (a) Any agreement relating to the treaty which was made between all the parties in connexion with the conclusion of the treaty; (b) Any instrument which was made by one or more parties in connexion with the conclusion of the treaty and accepted by the other parties as an instrument related to the treaty. 3. There shall be taken into account, together with the context: (a) Any subsequent agreement between the parties regarding the interpretation of the treaty or the application of its provisions; (b) Any subsequent practice in the application of the treaty which establishes the agreement of the parties regarding its interpretation; (c) Any relevant rules of International Law applicable in the relations between the parties. 4. A special meaning shall be given to a term if it is established that the parties so intended. Article 32 Supplementary means of interpretation: Recourse may be had to supplementary means of interpretation, including the preparatory work of the treaty and the circumstances of its conclusion, in order to confirm the meaning resulting from the application of article 31, or to determine the meaning when the interpretation according to article 31: (a) leaves the meaning ambiguous or obscure; or (b) leads to a result which is manifestly absurd or unreasonable. 52  Accordance with International Law of the Unilateral Declaration of Independence in Respect of Kosovo (ICJ Advisory Opinion of 22 July 2010) para 94.

Contextualising International Law 21

its origins with respect to the practice and opinio juris, given that the State practice in question is specific/concrete. Thus, Lon Fuller asserts, albeit in the domestic law context: The great advantage of customary law is that in its inception it permits the parties subject to it ‘to try it on for fit.’ If it does not fit at all, it will normally be abandoned before it has become so firmly fixed that it cannot readily be discarded.53

Moreover, the presumption of legitimacy of State action embedded in the Lotus case54 ensures that prohibitory norms of International Law arise and are set within a contextual milieu. On the other hand, State actions justified on the basis of a permissive rule would draw from a non-contextually founded rule. In addition, the interpretation of customary international norms must perforce reflect the customary rules of interpretation of treaties viz, the interpretation must be in good faith, taking into account the context within which the CIL norm arises. Thus, if the particular CIL norm is set within the framework of an underlying principle, the principle can inform a wider application of the CIL norm, as ­illustrated by the ICJ in Costa Rica v Nicaragua, as follows: Furthermore, the Court concluded in that case that ‘it may now be considered a requirement under general International Law to undertake an environmental impact assessment where there is a risk that the proposed industrial activity may have a significant adverse impact in a transboundary context, in particular, on a shared resource’ (ICJ Reports 2010 (I), p 83, para 204). Although the Court’s statement in the Pulp Mills case refers to industrial activities, the underlying principle applies generally to proposed activities which may have a significant adverse impact in a transboundary context.55,56

In the same vein, CIL obligations must be performed in good faith as per treaty obligations. Finally, the context of CIL is defined by certain temporal principles. Thus, the ICJ applied the doctrine of intertemporal law to prescribe a particular time framework for the law on State immunity as follows: The Parties are thus in broad agreement regarding the validity and importance of State immunity as a part of Customary International Law. They differ, however, as to whether (as Germany contends) the law to be applied is that which determined the scope and extent of State immunity in 1943–1945, ie, at the time that the events giving rise to the

53 

Fuller, above n 10, 77. SS Lotus Case (France v Turkey), PCIJ Rep, (1927) Series A No 10, at 18–19 wherein the Court stated: ‘Far from laying down a general prohibition … it [international law] leaves them in this respect a wide measure of discretion which is only limited in certain cases by prohibitive rules.’ 55  See also Reparation for Injuries Suffered in the Service of the United Nations (ICJ Advisory ­Opinion 1949) p.12 wherein the ICJ observed: ‘Thus, the rule of the nationality of claims affords no reason against recognizing that the Organization has the right to bring a claim for the damage referred to in Question 1 (b). On the contrary, the principle underlying this rule leads to the recognition of this capacity as belonging to the Organization, when the Organization invokes, as the ground of its claim, a breach of an obligation towards itself.’ 56  Costa Rica v Nicaragua (ICJ: 2015) para 104. 54 See

22  Contextualising International Law proceedings in the Italian courts took place, or (as Italy maintains) that which applied at the time the proceedings themselves occurred. The Court observes that, in accordance with the principle stated in Article 13 of the International Law Commission Articles on Responsibility of States for Internationally Wrongful Acts, the compatibility of an act with International Law can be determined only by reference to the law in force at the time when the act occurred. In that context, it is important to distinguish between the relevant acts of Germany and those of Italy. The relevant German acts—which are described in paragraph 52—occurred in 1943–1945, and it is, therefore, the International Law of that time which is applicable to them.The relevant Italian acts—the denial of immunity and exercise of jurisdiction by the Italian courts—did not occur until the proceedings in the Italian courts took place. Since the claim before the Court concerns the actions of the Italian courts, it is the International Law in force at the timeof those proceedings which the Court has to apply.57

The time dimension to context is also embedded in disputes involving territories namely the uti possidetis juris principle;58 and the principle that gives significance to the date when a territorial dispute is crystallised.59 Third, the law creating agencies of International Law allow for regional normative structures. Thus, fundamentally regional customary norms60 are acknowledged; modifications inter-se of multilateral treaties can take place;61 and regional co-operative arrangements have an accepted place in the i­nternational legal system.62 One manner of understating this phenomenon is to regard these as exceptions. However, these are not self-evidently exceptions. Indeed, they are not articulated as such in any of the spheres referred to herein. In fact, these are instances that are consistent with the ‘bric-a-brac’ nature of International Law; and a contextually driven approach to the development of International Law. Fourth, a number of International Law norms specifically have embedded in them a contextual dimension which determines the content and scope of the norm. Thus, the requirement under CIL for the delineation of the limits of the exclusive economic zone and continental shelf in the absence of an agreement

57 

Jurisdictional Immunities of the State (Germany v Italy: Greece Intervening) (ICJ: 2012) para 58. See for example Frontier Dispute (Burkina Faso/Republic of Mali) (ICJ: 1986) 565, para 20. 59 See for example, Case Concerning Sovereignty Over Pedra Branca/Pulau Batu Puteh Middle Rocks and South Ledge (Malaysia/Singapore) (ICJ: 2008): ‘32. The Court recalls that, in the context of a ­dispute related to sovereignty over land such as the present one, the date upon which the dispute crystallized is of significance. Its significance lies in distinguishing between those acts which should be taken into consideration for the purpose of establishing or ascertaining sovereignty and those acts occurring after such date, “which are in general meaningless for that purpose, having been carried out by a State which, already having claims to assert in a legal dispute, could have taken those actions strictly with the aim of buttressing those claims” Territorial and Maritime Dispute between Nicaragua and Honduras in the Caribbean Sea (Nicaragua v Honduras), Judgment, (ICJ: 2007), pp 697–698, para 117.’ 60  See for example Asylum (Colombia v Peru) (ICJ: 1950) 266. 61  Art 41 of Vienna Convention on the Law of Treaties 1969. 62  Art VIII of UN Charter. 58 

Contextualising International Law 23

should be such as to achieve an equitable solution63—an equitable solution calls for the taking into account of the specific context of the particular maritime zones. Thus, this has been explained as follows: The methodology which the Court usually employs in seeking an equitable solution involves three stages. In the first, it constructs a provisional equidistance line unless there are compelling reasons preventing that. At the second stage, it considers whether there are relevant circumstances which may call for an adjustment of that line to achieve an equitable result. At the third stage, the Court conducts a disproportionality test in which it assesses whether the effect of the line, as adjusted, is such that the Parties’ respective shares of the relevant area are markedly disproportionate to the lengths of their relevant coasts (Maritime Delimitation in the Black Sea (Romania v. Ukraine), Jugement, ICJ Reports 2009, pp 101–103, paras 115–122; Territorial and Maritime Dispute (Nicaragua v. Colombia), Judgment, ICJ Reports 2012 (II), pp 695–696, paras 190–193).64

In the same vein, certain CIL norms are inherently structured or interpreted such that the obligations are differential in terms of the particular factual circumstances in question. The context of such norms is thus externally informed, as for example the degree to which there needs to be exercise of State authority in the determination of title to territory. The ICJ recently affirmed this as follows: ‘The Court further recalls that, as expounded in the Eastern Greenland case (see paragraph 64 above), International Law is satisfied with varying degrees in the display of State authority, depending on the specific circumstances of each case.’65 Fifth, the practice of differential treatment for developing countries is widespread in important spheres of international disciplines viz, International ­Economic Law and Environmental Law. This is a contextualised approach to normative development and its implementation. Although this practice is considered treaty-based there is now sufficient practice to re-visit this analysis.66 From the perspective of this work however the underlying principle of differential treatment is that differently located subjects need to be treated differently. This is a facet of the contextual nature of International Law and has a relevance to the interface between International Law and regional affairs too.

63  Case Concerning Maritime Dispute (Peru v Chile) (ICJ: 2014) Para 179. ‘The Court proceeds on the basis of the provisions of Articles 74, paragraph 1, and 83, paragraph 1, of UNCLOS which, as the Court has recognized, reflect customary International Law (Maritime Delimitation and Territorial Questions between Qatar and Bahrain (Qatar v. Bahrain), Merits, Judgment, ICJ: 2001), p 91, para 167; Territorial and Maritime Dispute (Nicaragua v. Colombia), Judgment, (ICJ: 2012) (II), p 674, para 139). The texts of these provisions are identical, the only difference being that Article 74 refers to the exclusive economic zone and Article 83 to the continental shelf. They read as follows: “The delimitation of the exclusive economic zone [continental shelf] between States with opposite or adjacent 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.”’ 64  Case Concerning Maritime Dispute (Peru v Chile) (ICJ: 2014) para 180. 65  Case Concerning Sovereignty Over Pedra Branca/Pulau Batu Puteh Middle Rocks and South Ledge (Malaysia/Singapore) (ICJ: 2008) para 67. 66 See for example, A Qureshi and A Ziegler, International Economic Law (London, Sweet & Maxwell, 2011) 64–71.

24  Contextualising International Law

Sixth, adjudication, which is fundamental to the implementation and development of International Law, is a process that further contextualises International Law, and in this regard the deliberations of the ICJ are important. First and foremost, the process of adjudication is essentially a process of contextualisation. Thus, the ICJ has observed: In contentious cases, the function of the Court, as defined in Article 38, paragraph 1, of the Statute, is to ‘decide in accordance with International Law such disputes as are submitted to it’. Consequently, the requests that parties submit to the Court, must not only be linked to a valid basis of jurisdiction, but must also always relate to the function of deciding disputes.67

Moreover, as Lon Fuller stated adjudication ‘is a collaborative process of decision in which the litigant plays an essential role.’68 In the same vein, he asserts with reference to adjudication in the common law system that the courts of the common law do not lay down their rules in advance, but develop them out of litigated cases. This inevitably means that the shape taken by legal doctrine in a particular jurisdiction will be influenced by the accidents of litigational history within the jurisdiction.69

Second, generally the ICJ approach, in particular to territorial and maritime ­disputes, is to set out at the outset in the judgments the historical context and origin of the dispute.70 Whilst this may be considered to be mainly a historical approach to the elucidation of the factual circumstances of the dispute, it is the case that this approach is also about setting and adjusting the locus of the relevant International Law in question, and the manner in which it informs the facts of the dispute. Thus, in the Case Concerning Sovereignty over Pedra Branca/Pulau Batu Puteh, Middle Rocks and South Ledge,71 the ICJ observed in terms of the ­implications of a p ­ articular agreement as follows: In light of this analysis, in the context of the history surrounding the conclusion of the 1824 Anglo-Dutch Treaty, the Court is led to conclude that the division of the old ­Sultanate of Johor and the creation of the two Sultanates of Johor and of Riau-Lingga

67 

Frontier Dispute (Burkina Faso/Niger) (ICJ: 2013) para 48. Fuller, above n 10, 101. 69  ibid, 98. 70  See for example Request for Interpretation of the Judgement of 15 June 1962 In the Case Concerning the Temple of Preah Vihear (Cambodia v Thailand) (ICJ: 2013); Questions Relating to the Obligation to Prosecute or Extradite (Belgium v Senegal) (ICJ: 2012); Jurisdictional Immunities of the State (Germany v Italy: Greece Intervening) (ICJ: 2012); Application of the Interim Accord of 13 September 1995 (The former Yugoslav Republic of Macedonia v Greece) (ICJ: 2011); Case Concerning Maritime Dispute (Peru v Chile) (ICJ: 2014); Frontier Dispute (Burkino Faso/Niger) (ICJ: 2013); Dispute Regarding Navigational and Related Rights (Costa Rica v Nicaragua) (ICJ: 2009) 9; Case Concerning Sovereignty Over Pedra Branca/Pulau Batu Puteh Middle Rocks and South Ledge (Malaysia v Singapore) (ICJ: 2008). 71  Case Concerning Sovereignty Over Pedra Branca/Pulau Batu Puteh Middle Rocks and South Ledge (Malaysia v Singapore) (ICJ: 2008). 68 

Contextualising International Law 25 were part of the overall scheme agreed upon by the United Kingdom and the N ­ etherlands that came to be reflected in the 1824 Anglo-Dutch Treaty. In other words, the Treaty was the legal reflection of a political settlement reached between the two colonial Powers, vying for hegemony for many years in this part of the world, to divide the territorial domain of the old Sultanate of Johor into two sultanates to be placed under their respective spheres of influence. Thus, in this scheme there was no possibility for any legal vacuum left for freedom of action to take lawful possession of an island in between these two spheres of influence. This political settlement signified at the same time that the territorial division between the two Sultanates of Johor and of Riau-Lingga was made definitive by the conclusion of this Anglo-Dutch Treaty.72

Finally, International Law where appropriate is open to taking cognisance of the diverse nature of the subjects of International Law. In other words, the process of recognising subjects of International Law for different purposes involves taking into account the context of the recognition. Thus, the ICJ has observed once in the context of ‘international organisations’, and on another, with reference to a ‘State like’ regime as follows: In the case concerning Reparation for Injuries Suffered in the Service of the United Nations, the Court observed: ‘The subjects of law in any legal system are not necessarily identical in their nature or in the extent of their rights, and their nature depends upon the needs of the community’ (ICJ Reports 1949, p 178). In examining the propositions of Mauritania regarding the legal nature of the Bilad Shinguitti or Mauritanian entity, the Court gives full weight both to that observation and to the special characteristics of the Saharan region and peoples with which the present proceedings are concerned.73

In the same vein, the mandate of a key subject of International Law viz an ­international organisation, is contextualised by the principle of speciality. This was explained, for example, as follows: ‘[i]nternational organizations are governed by the “principle of speciality”, that is to say, they are invested by the States which create them with powers, the limits of which are a function of the common interests whose promotion those States entrust to them.’74 In sum, contextualism is fundamental and overarching in International Law. It is an essential driver in its engagement. This is in some senses axiomatic in so far as the operation of International Law generally is concerned—in particular in the field of treaty interpretation. However, what is being extrapolated from this contextual nature of International Law here is a specific normative interface with the different regions within which States operate. There is a symbiotic relationship between International Law and the mosaic of different regional spheres in the world that is fuelled by contextualism in International Law. International Law in context has to take cognisance of the regional setting it is engaged in and is informed by it. 72 

ibid, para 98. Western Sahara (ICJ Advisory Opinion 1975) para 148. Legality of the Use by a State of Nuclear Weapons in Armed Conflict, Advisory Opinion, (ICJ: 1996) (I), 78, para 25. 73  74 

26  Contextualising International Law

IV.  Contextualising International Law in Practice Whereas the case for contextualising International Law in a regional setting is not difficult to substantiate, although it needs to be made, for it cannot be taken for granted, the challenge of contextualising in practice International Law in a regional setting is complex, and raises a bundle of questions. What is the context of a regional setting? How can it be discerned? How can International Law be contextualised in a regional setting? How can International Law be contextualised without necessarily engaging in a relativist claim? Generally, the context of a regional setting depends on the purpose for which it is being considered. It is not possible in abstract to determine its constituent ­elements and contours. Moreover, questions about culture, history and practice can sometimes be difficult to ascertain, substantiate or agree upon. However, despite the difficulties, which are not necessarily insurmountable, the important point is that in the same way as there is a concerted focus on the relevant law, there has to be also a conscientious focus on the context which implicates the law. In this respect the onus is on those relying on the context to substantiate it. This is essentially an endogenous exercise. The contextualisation of International Law in a regional setting can take place both ex ante and ex post. Regional efforts at shaping International Law in its very inception can take the form of developing regional practices adapted to the exigencies of the region, ensuring in multilateral fora an organised regional perspective, and entering into regional agreements. Of course, there needs to be consensus but the fact that there is no consensus on some issues does not mean there cannot be consensus on other issues. For example, there is much ado in the Korean peninsula about unification of the two Koreas but this discourse is not accompanied by any foresight on what should be the appropriate rules on State succession, indeed how the International Law on State succession should evolve. Ex-post contextualisation is the process of shaping the law for a just resolution. For example, given that acquiescence can be of significance in the prescriptive mode of territorial acquisition, the interpretation of acquiescence has to be set against the cultural trait in the region of restraint in immediately reacting to a situation. In the same vein, does the principle of uti possidetis apply to NEA, given that the rational and contextual origins of the principle are on the whole outside the context of NEA? A survey of existing academic discourse in International Law in NEA suggests that there is a gradual orientation towards a contextualised approach to International Law and its development.75 However, looked at collectively the discourse can be partisan—taking Korean, Japanese or Chinese perspectives

75  See for example the works of Onuma Yasuaki (Japan), Seokwoo Lee (Korea) and Jia Bing Bing (China).

Conclusions 27

respectively particularly with respect to inter-se conflicts. There does not seem to be any m ­ eaningful dialogue in International Law with experts in International Law from North Korea. There may be reasons for this that are set within North Korea and its predicament in international relations but there are barriers too within South Korea in this respect with prohibitions on access to North Korean ­materials/websites and discourse amongst academics in the two countries. Moreover, there is a dearth of legal analysis from a theoretical perspective of the various issues, apart from International Law scholarship based on Marxist philosophy. Generally, the literature is of relatively recent origins, although the pace at which the focus in International Law is developing is very noticeable— particularly in the field of International Economic Law and issues of conflict as between the three nations respectively viz maritime and territorial disputes. In some measure the content and quality of the literature in international law originating in NEA reflects the research culture in universities; State influence in the work of academics and their work with the respective governments; along with the degree and manner in which International Law scholarship from the West is received within the region. Thus, in some States textbooks may be the subject of greater State scrutiny than scholarship in journal articles. Moreover, textbooks and monographs generally are less weighted than article publications in terms of academic career progression in universities. Where research funding is dependent on the State and there is active involvement of academics in governmental work, the exposition of law is more ‘practitioner oriented’—almost in the nature of advocacy. In sum, a greater emphasis on the comprehension, practice and shaping of International Law from a contextual perspective is called for. Unfortunately, despite great economic advances including in the technological sphere, the intellectual inspiration in International Law in universities in the region still is westward oriented. This is the case too in terms of hiring lawyers in dispute settlement in international fora. The opportunities that may be availed from a contextual approach to International Law however are endogenous.

V. Conclusions Whilst the title of this work is ‘Contextualising International Law in the North East Asian Matrix’ the thesis of this focus is the need for a further contextualisation of the discipline in the North East Asian matrix. In some senses context in law is a given. From the perspective of NEA however it cannot be a mere given. In Eurocentric International Law, contextualisation is not so much significant as it is almost taken for granted. Whilst a contextualised approach may well be equated with relativism and a threat to universalism, in the NEA matrix contextualism has a different significance, indeed a necessary one. Context assimilates the regional matrix to International Law thus facilitating a more democratic, just and efficient

28  Contextualising International Law

engagement in it. In conclusion, regionalism has a normative basis in I­ nternational Law both at the level of implementation as well as its development. Context exists in the very nature and practice of International Law. Moreover, discourse on International Law that is not sufficiently contextualised can result in obfuscating historic misdeeds and the real agenda behind the ­development of certain rules of International Law. Thus, whilst the need for ­contextualising International Law has been emphasised herein in terms of North East Asia; the question also needs to be posed whether contemporary ­West-centric discourse on International Law is sufficiently contextualised within its West-­ centricity. Generally, the approach to discourse on International Law in Westcentric legal literature comprises of an effort in objectifying International Law as an objective science removed from its domestic/regional setting other than the historical European narrative. This is reinforced by elevating the discourse to a level of abstraction and theory. Thus, historical accounts of the origins and development of International Law are generally short in standard textbooks in International Law.76 Moreover, the impact of individual empires on international relations is assimilated to a collective European history. In this manner the historical past of individual countries in international relations, as well as contemporary incidents, can be spared closer scrutiny, including the relationship of the development of International Law with those events. In sum the development and fait accompli of International Law in West-centric literature is projected as being an objective reality, whether underpinned by positivism, realism or natural law—at the expense of clearer insights into the reasons for the manner of its development, and the role of vested State interests that have shaped particular rules. In sum, International Law not sufficiently grounded in context not only is set to wither away, it also obscures the developmental history of International Law rules including individual State/ regional responsibilities under it.

76 See for example James Crawford, Brownlie’s Principles of Public International Law 8th edn (Oxford, OUP, 2012).

2 Challenging Approaches to the Application of International Law in the Historical Setting of North East Asia ‘History is in the sense of the victor and the narrator—truth however is in justice and the legal sense of it.’ Asif H Qureshi1

I. Introduction History has a locus in legal context. A historical account in a legal context is an aspect of justice as much as a requirement for legal analysis. It has relevance not only in terms of maritime and territorial disputes but also disputes originating in times of war. Confronting it is also part of the ‘closure and moving on process’ in the resolution of disputes embellished in historical facts. Indeed, resolving historical disputes is about rectificatory justice—which if not realised will fester to undermine any legal resolutions arrived at. Moreover, the history of international relations in North East Asia (NEA)2 is a facilitator in the understanding of International Law and its development in the region. For outsiders and the newer generations, of course history has to be learnt and is not innate. However, any historical narrative has to be critically set—in particular the narrative has to take cognisance of all the possible narratives and be open to changes. Importantly too in the quest for historical justice as a matter of justice some difficult questions need to be posed viz how far in future generations should the burden of the quest for justice continue and how far should the logic of justice be taken? I would describe these questions, in particular the former, as referring to the question of the sustainability of the quest for justice drawing from the concept of sustainable 1 I am grateful to Professor Toyoda Tetsuya of Akita International University, Japan for his ­observations on a draft of this chapter. 2  North East Asia herein refers to Korea, China and Japan.

30  International Law in the Historical Setting

development. ‘Sustainable justice’ thus here is about measure and reason in the insanity that can sometimes characterise quests for historical justice. It is not so much the continuity of the justice in time and scope but rather about a sustainable approach to the quest for justice in terms of generational burdens in its quest and full exactitude in its fulfilment. The focus here is twofold: on the origins and development of International Law in the historical setting of international relations in NEA; and historical events in NEA from the perspective of International Law. This historical setting is common to NEA but also needs to be understood in terms of the historical relationships as between the respective States in NEA. Such a focus begs the question what is the appropriate analytical framework within which this historical narrative from a legal stand-point should unfold. First, if a chronological approach is taken of the origins and development of International Law in NEA then such a narrative depends on the very conception of ‘International Law’ relied upon. Second, in the same vein, if the origins of International Law are to be traced to the advent of a ‘State’ system in the region, assuming necessarily the State is the only building block for International Law—and not for instance a ‘region’ within which different State-like regimes existed—then there has to be a conception of a ‘State’ and the very propriety of the ‘State’ as a building block of an international legal system has to be examined. Third, a utilitarian or normative approach to the historic role of International Law in the region could be availed—describing the functional or normative relevance and application of International Law in different historic epochs of the region. Finally, the historical insights could be selective essentially to shed light on contemporary legal and policy issues. The approach taken herein takes on board these diverse considerations but with critical, rectificatory justice and legal stand-points. In particular this historical excursion is intended to shed light on the resolution of legal disputes enmeshed in the history of the region. This exposition of International Law from a historical perspective has a different dimension than if it related to the regional setting of the West, although some of the themes may be similar. Thus, there is a historical relationship between developments in International Law in the NEA and the advent of International Law in the West that requires specific addressing in terms of NEA viz, whether International Law was introduced to NEA, or it existed in some form all the time in the region. This relationship has not been understood as being critical hitherto, at any rate in the historical narrative of the development of International Law in the West.3 Moreover, the relative significance of history in the region is reflected in the fact that contemporary issues in international relations in the West are somewhat more removed from historical antecedents, than in the case of NEA—most disputes embellished in the past having been more or less resolved or reconciled. International Law in its historical dimension comes with a set of legal filters which define the past from the future; and render the historical facts t­ ransparent

3 

See for example M Shaw, International Law (Cambridge, CUP, 2008) 15.

Filters and Obstacles in a Historical Perspective of International Law in NEA 31

and/or relevant, opaque and/or irrelevant. A historical exposition of International Law in NEA thus calls for some initial discourse on such general filters in International Law, such as the doctrine on inter-temporal law, the prohibition on retroactive application of International Law, and the inter-face between peremptory norms of International Law, State immunity and historic facts and law. In the same vein, International Law has to be evaluated by notions of rectificatory justice to address past injustices. In addition to the legal filters the development of International Law in its historic setting cannot be understood through the paradigm of modern International Law.4 Thus, historical conceptions of the subjects of International Law (and therefore States) and the medium of treaties (in its scope and nature) for forging international relations differed historically amongst different civilisations. In sum, since the object of this historical focus is to provide the context for the present understanding and engagement of International Law within NEA, the orientation of this historical excursion will be from a contemporary perspective. First, therefore, the temporal filters and obstacles to a focus from an International Law perspective are considered. Second, the antecedents of international relations and International Law in NEA are outlined. The time line for this stand-point will stretch across both ancient and modern times. Finally, one caveat about delving in the past—historical accounts can be disputed, as happened in 2001 when a controversial Japanese history textbook was published.5 The purpose of this chapter is not to engage in the advocacy of a particular version of a past, rather the focus is on the historical development of International Law. Moreover, it is important to identify the contested issues involved in an engagement with the past, as much as it is relevant to highlight aspects of the past.

II.  Filters and Obstacles in a Historical Perspective of International Law in NEA The disputes in NEA that are embellished in the past are of a variegated nature and are alive for a number of reasons. Thus, the historical facts may or may not

4  Onuma Yasuaki, A Transcivilizational Perspective on International Law 9 Pocketbooks of the Hague Academy of International Law (Leiden, Martinus Nojhoff, 2010) ch IV. 5  For example, the publication of K Nishio et al, New History Text or Atarashii rekishi kyōkasho (Fusosha, 2001) under the auspices of the Japanese Society for History Textbook Reform and Japanese Ministry of Education, Culture, Sport, Science and Technology caused much offence in Korea. This eventually led to the establishment of a Korea-Japan Joint History Research Committee in 2001 leading to a joint Korea-China-Japan publication titled A History Opening the Future published in 2005. See https://www.nahf.or.kr/eng/. This publication does not however appear to be an inter-State agreed upon historical account.

32  International Law in the Historical Setting

be contested; the act/s and legal material/s under conditions of war and occupation may or may not have been legal under the prevailing times; and subsequent agreements relating to them may or may not be final and dispositive of the issues. The facts and materials may or may not be informed by contemporary developments in International Law—in particular developments in peremptory norms of International Law. Some disputes are based on wartime atrocities in the not too distant past, as for instance the question of the responsibility of Japan towards the Comfort Women; and some are based in the distant past, as for instance the question of the legality of the Japanese annexation of Korea in 1910; or evidence of historical title to Islands. Some of the disputes persist because of a lack of their timely resolution; or a lack of capacity to enforce rights at the right moment in history. Some historical issues are not so much disputes as doctrinal controversies, for example when did International Law first emerge in NEA? Was there a functioning interacting international community of States in the region? There is merit from an historical perspective per se in addressing these questions. But this doctrinal discourse may also add gravitas to the region in its capacity to sculpture the very architecture through which legal analysis engages with the history of NEA. The historically founded disputes engage first and foremost temporal filters for the purposes of legal analysis—such as the principle of non-retroactivity and the doctrine of inter-temporal law, the former precluding the application of law retroactively and the latter calling for the consideration of relevant facts in the light of the law contemporaneous with them.6 Similarly, certain procedural and substantive filters in International Law—such as State immunity, defective or complete lack of consent to jurisdiction for the resolution of the dispute in international judicial fora; existing agreement/s purporting to be dispositive of the issues; the doctrines of estoppel and acquiescence; and developments in peremptory norms in International Law—cumulatively affect the light in the prism through which the past is conceived for the purposes of legal analysis and adjudication. Such ­filters may facilitate or act as obstacles to the resolution of the disputes. The filters in the prism through which the past is understood in legal analysis have a function in arbitrating between the past and the present. They shed light not only onto how simmering historical issues can be unlocked so that they may be addressed—in particular in the light of contemporary developments in International Law—but also, in ensuring that the functions of the modern State are not unduly paralysed in the retrospective being addressed. But legal analysis alone will never suffice to address underlying feelings of injustice in the international relations as between States and the States of NEA. In some measure whereas the filters balance certain legitimate policy goals they also secure a power-brokered unjustlysecured status quo. The legal prism therefore has to be sculpted such that the light of justice is undistorted as it filters through it and accommodates the exigencies of

6 

Islands of Palmas Arbitration, Netherlands v US (PCA: 1928).

Filters and Obstacles in a Historical Perspective of International Law in NEA 33

the region rather than those of a past era. Sculpting therefore involves not taking as given seemingly long-established International Law filters and asking whether their application is appropriate to the particular regional context of NEA. In sum, the nature of the controversies involves determination of the relevant temporal law; the consequences of a lack of capacity to bring claims at the right time in history; and fundamental questions about the very applicability of certain principles in International Law to historical incidents in NEA. In the same vein, there is here a relevant discourse on rectificatory justice as much as the propriety of resurrecting the past—both of which have a temporal dimension. A historical perspective of International Law in NEA therefore has to be understood through a reconstructed prism—informed by inter-nation and inter-generational justice including a sustainable burden for the quest of justice across generations (sustainable justice). This perspective of the past has to be very much from a focus from the present looking at the future.

A.  Temporal Filters: Legality and Policy With respect to the time of the applicable law the juridical facts can be varied, for example set in one-time dimension, or straddling different ones; or indeed calling for an interface between the facts in one dimension and the law in another. Rosalyn Higgins7 categorises these famously as ‘Now and then’—referring to the question whether acceptance of a court’s jurisdiction now can allow for the consideration of facts in the past; ‘Then and now’—referring to the question whether the International Law of ‘now’ can be applied over facts that happened ‘then’ ie, retrospectively; ‘Long enough time’ referring to the policy underpinning time limitations for instigating proceedings; and ‘Too long ago’ referring to the situation wherein the doctrine of intertemporal law applies. In the context of these different scenarios respectively, the following is of particular note from her work which draws from the deliberations of the International Court of Justice (ICJ). First with respect to ‘Now and then’, the jurisdiction consented to, of course, depends on the manner of the consent proffered. Second, with respect to ‘Then and now’ there are circumstances when International Law can apply retrospectively, despite the general prohibition on retrospective application of law.8 Third, that whereas there is no limitation period in International Law in the bringing of a claim, a court may determine in the light of the circumstances of a case, that delay in submission of a claim renders a claim inadmissible. In so far as a peremptory norm is

7  See R Higgins, ‘Time and the Law: International Perspectives on an Old Problem’ (1997) 46(3) International and Comparative Law Quarterly 501–20. 8  See Markus Kotzur, ‘The Temporal Dimension: Non-retroactivity and its Discontents’ in CJ Tams et al, Research Handbook on the Law of Treaties (Cheltenham, Edward Elgar, 2014); and João Grcmdino Bodas, ‘The Doctrine of Non-Retroactivity of International Treaties’ (1973) 68 Revista La Faculdade de Direito de Sao Paulo. See also Art 28 of the VCLT.

34  International Law in the Historical Setting

concerned however time is no bar. Thus, a protest is not necessary ‘to preserve rights affected by such an act.’9 Fourth, with respect to the doctrine of intertemporal law this is mainly focused in terms of territorial disputes, and has less of a relevance to human rights obligations and the law of treaties. In sum, her description of the topography of law and facts in different time zones emphasises, indeed justifies, the porous nature of the different zones, and their interfaces in particular circumstances. The past and the present are intertwined in many respects. Rosalyn Higgins’s analysis is of course relevant to the circumstances of NEA, and can be reformulated in terms of procedure and substance. From this perspective, the ‘Now and then’ and ‘Long enough time’ are grounded mainly in procedure. The ‘Now and then’ discourse has a cautionary tale if and when all the NEA States consent to the jurisdiction of the ICJ, or indeed any other judicial forum whose jurisdiction they have not yet consented to. Both Korea and China have not consented to the compulsory jurisdiction of the ICJ under Article 36 (2) of the Statute of the ICJ. Should they do so the manner in which they lock in the time dimension will be important, and important too in terms of the Japanese declaration for compulsory jurisdiction to the ICJ. The Japanese consent to the jurisdiction of the ICJ is expressed in relevant parts as follows: [I]n relation to any other State accepting the same obligation and on condition of reciprocity, the jurisdiction of the International Court of Justice, over all disputes arising on and after 15 September 1958 with regard to situations or facts subsequent to the same date and being not settled by other means of peaceful settlement.10

There are a number of questions that could possibly arise with respect to the ­interpretation and application of this provision. When does a dispute arise? When the facts of the dispute arose? When the facts of the dispute become justiciable? What is meant by ‘situations or facts subsequent to the same date’? Does it cover situations or facts that straddle both time frameworks? Is a legal agreement a ‘situation or fact’? What is meant by ‘being not settled by other means of peaceful settlement’? Does it cover settled but not completely settled? Does it cover settled contrary to peremptory norms of International Law? In the same vein, the ‘Long enough time’ exposition has implications for the continued lack of consent to the jurisdiction of the ICJ. Could self-imposed abstentions in consenting to ICJ jurisdiction today render future claims in the ICJ (or elsewhere) inadmissible on the basis of there having been ‘long enough’ time for such a claim not being pursued, if the circumstances so warranted? The ‘Then and now’ and ‘Too long ago’ are more substantive in nature. Both have an important bearing on the issues that confront the NEA. Both manage the interaction between contemporary and historical norms. Both serve to determine

9 

10 

R Jennings and A Watts, Oppenheim’s International Law 9th edn (Longman: 1992) Vol 1, 8. See Japanese Declaration to the ICJ 2015.

Filters and Obstacles in a Historical Perspective of International Law in NEA 35

what the applicable temporal normative framework is. However, neither provides absolute rules, underpinned as they are by various qualifications. Both challenge the call for rectificatory justice, which underpins some important disputes in the region. But leaving aside for the present discourse on rectificatory justice, and its relationship with the development of International Law, including the qualifications to them accepted generally in the discourse on non-retroactivity, do the principle of non-retroactivity and the doctrine of inter-temporal law in themselves have the same degree of relevance to NEA as elsewhere. Are there strong reasons for completely displacing them in their application to the issues in the region? Or are there compelling reasons for their strict application? The principle of non-retroactivity is settled in treaty law.11 Is it a norm of ­Customary International Law and/or a General Principle of Law or both? The legality of the principle in General International Law is not without controversy.12 However, Markus Kotzur observes: The constant State practice (in most cases States do not provide for retroactivity of the treaties they enter into), the approval by conventional practice, by international organizations, as well as by international courts and tribunals, clearly indicates the existence of customary law.13

A number of observations may be made here with respect to this evidence and conclusion with respect to Customary International Law. First, with respect to the existence of State practice this is not very compelling notwithstanding the ­existence of the principle in the domestic setting. Despite assertions of the commonality of problems and relevance of the principle in the domestic and international legal systems,14 the two systems are actually different. Domestic legal systems are more detailed and complete than International Law. International Law at any given time is the product of compromise and the exigencies of the time. In such circumstances retroactivity in International Law can facilitate a better reconstruction of the legal relations that are imperfectly set in the past. A fundamental premise of non-retroactivity is that a past normative framework existed in a clear and complete sense at some meaningful level. The legal stability that the non-­ retrospective principle ensures is of a legal system which must exist at some level of development. Moreover, an important rationale for the non-retroactive principle is prevention of abuse of power and arbitrariness. This is understandable in the domestic context but does not have the same force at the international level that is horizontal in nature. Second, the State treaty practice and that of international organisations is within the framework of treaty law. This leaves only the rulings in international courts and tribunals as having most weight in the basket of evidence proffered. These therefore have to be considered in terms of their weight with

11 

12 

See Art 28 VCLT. See Kotzur, above n 8, 161.

14 

See, for example, Bodas, above n 8, 344.

13 ibid.

36  International Law in the Historical Setting

r­ eference to the context in which the rulings have been made. However, be that as it may, if there is a general Customary International Law norm on non-retroactivity, is there a regional or other exception relevant to the context of NEA? For example, is there a case for retroactivity when the victim State was unable to take on an issue on the international plane due to lack of capacity usurped from it without proper cause? Or is retroactivity in point where those in loco parentis failed to realise justice for those of their charge? Moreover, there is an important historical practice in the region of characterising retrospectively, albeit with respect to treaties alone— certain types of treaties entered into in the past, as being ‘unequal.’15 These are all exceptions which could have a basis in equity—and equity is surely an apposite principle informing the scope of the non-retroactive rule. To the extent that this principle is understood to be originating in domestic systems, and in International Law as a General Principle of Law, the observations above with respect to State practice in the context of Customary International Law are as relevant here. Moreover, the origins of such a principle date back to a time when the legal systems of NEA could not have been much succour for the establishment of such a principle. In passing it may be noted also that there have actually been doctrinal differences, albeit in the past, as to the existence and nature of General Principles of Law, as a source of International Law.16 Leaving aside legality, one of the fundamental underlying rationales for the nonretroactive principle is the prevention of abuse of power and arbitrariness. Given this it cannot surely at the same time be a principle that preserves past colonial injustices of conquest and exploitation. The durability of the egregious past set in a historic normative framework cannot outlast the enlightened developments in International Law. Can one generation whose sense of justice has progressed—as a matter of justice—apply a lesser form of justice to a situation which avails itself and calls for the application of a better form of justice? Or as R Higgins puts it ‘But by what moral entitlement may those who have not suffered decide that the perpetrators of harm to others should walk free?’17 Of course the very factoring in of retroactivity is a consideration per se that invokes discourse on justice in so far as it is concerned—but what if there are other considerations which neutralise the burdens of retroactivity? Finally, the non-retroactivity principle is fixed, albeit in two different time zones, wherein the beginning and end of history is different for different subjects of International Law. At the domestic level, the starting point of the temporal apparatus is set evenly for everyone. At the international level, this is not the case—States emerge in different time periods with different measures of connection with the past. Where the past in particular is in the living

15  See Ann Peters, ‘Treaties, Unequal’ Max Planck Encyclopedia of Public International Law [MPEPIL] 2007: http://opil.ouplaw.com/view/10.1093/law:epil/9780199231690/law-9780199231690-e1495 wherein the author states ‘The concept of unequal treaties might be recognized by customary international law.’ 16  See for example Grigory Tunkin, ‘International Law in the International System’ (1975) 147(IV) RCADI 1–218. 17  Higgins, above n 7.

Filters and Obstacles in a Historical Perspective of International Law in NEA 37

memory of a victim generation is it appropriate for the perpetrators of illegality to shelter behind an arbitrary time line creating a past and present? Moreover, as has been observed International Law is comprised of a process involving adjustments between generations—between the present and the past. Adjustments are about weighing the past with the present and cut across arbitrary timelines. Thus, Markus Kotzur asserts, somewhat resonating the principle of inter-generational equity in sustainable development, as follows: All legal codifications should be seen, at least to some extent, as ‘living instruments,’ the purpose of which is to adjust the achievements from the past to the ever-changing present-day circumstances and beyond that to the more or less predictable needs of the future.18

In sum, there is a case to posit the question whether it is appropriate in the circumstances of NEA or in particular circumstances of NEA, not to adhere to the application of the non-retroactivity principle, or indeed to reflect upon its application in an eclectic manner as appropriate to the subject in hand. That said, the notion of ‘sustainable justice’ wherein future generations should not be burdened with the efforts involved (and costs) in rectificatory justice, is consistent with the implicit argument proffered herein that future generations should have the option to call for rectificatory justice not however the burden and pressure of realising it. On the other hand, there are considerations based on stability and predictability, indeed pragmatism in the relationship between the past and the present that have been advanced. Thus, in Jurisdictional Immunities of the State (Germany v Italy) the ICJ seems to have erred in favour of this line.19 It concluded that the nature of jurisdictional immunity must be considered in the light of contemporary International Law, since it was the denial of immunity that was the subject of the German claim20—this was the Court’s temporal determination with respect to the determination of the scope of State immunity. It then went on to determine that the jurisdictional immunity for the State available under contemporary rules cannot be displaced by peremptory norms of International Law,21 18 

Kotzur, above n 8, 154. ICJ: 2012. 20  See para 58: ‘The Court observes that, in accordance with the principle stated in Article 13 of the International Law Commission Articles on Responsibility of States for Internationally Wrongful Acts, the compatibility of an act with international law can be determined only by reference to the law in force at the time when the act occurred. In that context, it is important to distinguish between the relevant acts of Germany and those of Italy. The relevant German acts—which are described in paragraph 52—occurred in 1943–1945, and it is, therefore, the international law of that time which is applicable to them. The relevant Italian acts—the denial of immunity and exercise of jurisdiction by the Italian courts—did not occur until the proceedings in the Italian courts took place. Since the claim before the Court concerns the actions of the Italian courts, it is the international law in force at the time of those proceedings which the Court has to apply’. 21  See para 83. ‘That said, the Court must nevertheless inquire whether customary international law has developed to the point where a State is not entitled to immunity in the case of serious violations of human rights law or the law of armed conflict. Apart from the decisions of the Italian courts which are the subject of the present proceedings, there is almost no State practice which might be considered to support the proposition that a State is deprived of its entitlement to immunity in such a case.’ 19 

38  International Law in the Historical Setting

on the basis inter alia that the relationship between the peremptory war crime and State immunity was not a situation of conflict between different norms—since State immunity was a procedural norm, and war crime was a substantive norm.22 Thus, in this case, effectively, a procedural norm hindered the retroactive reach of a peremptory norm. This is an unfortunate thread of ICJ reasoning that effectively robs a peremptory norm of its integrity and scope. It is certainly possible to distinguish between a procedural and substantive norm, but it is not clear if that distinction is relevant in terms of determining the due weight to the integrity, scope and gravitas that a peremptory norm is inculcated with. In fact, there were three important dissenting opinions in the case, which argued, for different reasons, that a peremptory norm involving an international crime could not be emasculated by State immunity. These dissenting opinions have much to commend them and have an important relevance to the circumstances of NEA. Indeed, they also serve to reinforce the thesis herein generally of the need to contextualise International Law. Thus, Judge Cançado Trindade observes: In conclusion on the point at issue, one cannot make abstraction of the factual context, of the historical background of the facts which gave origin to the present case. State immunities cannot be considered in the void, they constitute a matter which is ineluctably linked to the facts which give origin to a contentious case.23

Judge Cançado Trindade comes to the consideration of the scope of State Immunity from a human rights non-State centric approach. He starts off from the premise that International Law is ‘centered on the human person’,24 and that the weight of the deliberations of academic and learned institutions support the view for an exception to State Immunity in the case of international crimes.25 Importantly, since the ultimate beneficiaries of State responsibility in the case of international crimes and international humanitarian law are the victim individuals, the ‘titulaires of the right to reparation are the individuals concerned, the victimized human beings.’26 In the circumstances, ‘the State can waive only claims on its own behalf, but not claims on behalf of human beings pertaining to their own

22  See para 93: ‘The two sets of rules address different matters. The rules of State immunity are procedural in character and are confined to determining whether or not the courts of one State may exercise jurisdiction in respect of another State. They do not bear upon the question whether or not the conduct in respect of which the proceedings are brought was lawful or unlawful. That is why the application of the contemporary law of State immunity to proceedings concerning events which occurred in 1943–1945 does not infringe the principle that law should not be applied retrospectively to determine matters of legality and responsibility (as the Court has explained in paragraph 58 above). For the same reason, recognizing the immunity of a foreign State in accordance with customary international law does not amount to recognizing as lawful a situation created by the breach of a jus cogens rule, or rendering aid and assistance in maintaining that situation, and so cannot contravene the principle in Article 41 of the International Law Commission’s Articles on State Responsibility.’ 23  Dissenting Opinion, Judge Cançado Trindade para 23. 24  Para 40. 25  Para 52. 26  Para 64.

Filters and Obstacles in a Historical Perspective of International Law in NEA 39

rights, as victims of grave violations of international law.’27 Moreover, this right of ­reparation cannot be undermined through the invocation of State Immunity.28 Judge Abdulqawi A Yusuf defined the issue as ‘whether, in those exceptional circumstances where immunity may prevent the victims of international crimes from obtaining an effective remedy or where no other means of redress is available, such immunity should be granted or set aside by domestic courts.’29 This issue has to be considered through a contextual appraisal as follows: The granting or denial of immunity by domestic courts, in cases involving claims arising from international crimes where the law of State immunity, and exceptions thereto, is still uncertain or unsettled, requires a contextual assessment not only to ensure the proper characterization of the nature of the claims involved, but also to review the effect that such a decision may have on other normative values to which the international community attaches similar importance. It is indeed widely recognized in the jurisprudence of domestic courts that, before ruling on the existence of immunity as a right of the foreign State, a review of the underlying factors of the case has to be conducted to determine whether or not an exception applies …30

Can a peremptory norm have retrospective effect? This is an issue that can arise in the context of the interpretation of a Convention that codifies/contains a peremptory norm or indeed outside the context of treaty interpretation. There seem to be two alternative points of view here. On the one hand, it has been asserted: ‘… peremptory rules of international law cannot be retrospectively applied absent the agreement of the state alleged to have “breached” the norm at some point in the past to have the later law applied to the question of its responsibility.’31 In contrast Markus Kotzur observes: [N]ewly established norms of jus cogens clearly limit a contemporaneous understanding and also puts into question the principle of non-retroactivity. This was pointed out in the joint declaration of Judges Shi and Koromo of 26th February 2007 regarding the aforementioned case on the Application of the Convention on the Prevention and Punishment of the Crime of Genocide (Bosnia and Herzegovina v Serbia and Montenegro). The two judges emphasised that ‘in some respects the interpretation of a treaty’s provision cannot be divorced from developments in the law subsequent to its adoption’. Jus cogens has to be seen as the most significant of these ‘respects’. Consequently, the declaration continues: ‘even though a treaty when concluded did not conflict any rule of jus cogens, it will become void if there subsequently emerges a new rule of jus cogens with which it is in conflict’. Where jus cogens is at stake, the stability of a legal title is doubtless outweighed by the present-day concept of law and justice.32

27 

Para 71. Para 69. Dissenting Opinion of Judge Abdulqawi A Yusuf at para 56. 30  ibid at para 36. 31  See J Crawford, State Responsibility: The General Part (Cambridge, CUP, 2013) para 8.2.2.3; and Draft Articles on Responsibility of States for Internationally Wrongful Acts with Commentaries (2001) Art 13 and Art 64 of VCLT 1969. 32  Kotzur, above n 8, 180. 28  29 

40  International Law in the Historical Setting

This later observation it should be pointed out is based on the Joint Declaration of Judges Shi and Koroma, both of whom wrote also jointly a dissenting opinion in the Application of the Convention on the Prevention and Punishment of the Crime of Genocide (Bosnia and Herzegovina v Serbia and Montenegro) case.33 Judges Shi and Koroma drew their conclusion based on the work of Jennings and Watts.34 And their observations are in terms of the processes involved in the interpretation of a treaty impacted upon by a peremptory norm. Nevertheless, it is clear that the assertion is that the treaty will be void as a result of a conflicting peremptory norm not as a matter of interpretation a la Article 31 (3) (c) of the Vienna Convention since Article 31 (3) (c) refers to ‘relevant rules’ of international law. Would a conflicting peremptory norm be a ‘relevant rule’?35 Be that as it may, as a matter of policy a peremptory norm must surely trump an inconsistent previous norm whether General International Law or a treaty norm.36 Moreover, such a conclusion is also reinforced in law by the principles of lex posterior derogate legi priori and lex spcialis. Ultimately, if there is a controversy with respect to the non-retroactivity of a peremptory norm, of course it is always open to the States in NEA to consent to the retrospective application of peremptory norms, and to allow for contemporary rules of international law to apply retrospectively. Indeed, it may be contended that implicit in the consent to the formation of a new peremptory norm of the international community is the acceptance of its retrospective application.

i.  Rectificatory Justice Legal analysis of temporal filters has to be underpinned by a consideration of the policy issues involved in a retrospective perspective of injustices, and ­consequential

33 

ICJ: 2007. Jennings and A Watts, Oppenheim’s International Law (London, Longman, 1992) Vol I, 1281–82, footnotes omitted: ‘A treaty is to be interpreted in the light of general rules of international law in force at the time of its conclusion—the so-called inter-temporal law. This follows from the general principle that a juridical fact must be appreciated in the light of the law contemporary with it. Similarly, a treaty’s terms are normally to be interpreted on the basis of their meaning at the time the treaty was concluded, and in the light of circumstances then prevailing. Nevertheless, in some respects the interpretation of a treaty’s provisions cannot be divorced from developments in the law subsequent to its adoption. Thus, even though a treaty when concluded did not conflict with any rule of jus cogens, it will become void if there subsequently emerges a new rule of jus cogens with which it is in conflict. Similarly, the concepts embodied in a treaty may be not static but evolutionary, in which case their “interpretation cannot remain unaffected by the subsequent development of law … Moreover, an international instrument has to be interpreted and applied within the framework of the entire legal system prevailing at the time of the interpretation.” While these considerations may in certain circumstances go some way towards negating the application of the inter-temporal law, that law will still, even in such circumstances, provide at least the starting-point for arriving at the proper interpretation of the treaty.’ At 280 of ICJ Report. 35  See Peru-Additional Duty on Imports of Certain Agricultural Products (WT/DS457/ AB/R, 2015) on ‘relevant rules’. 36  See Jennings and Watts, above n 34, Vol 1 at 8: ‘nor can a rule of customary international law which conflicts with a rule of ius cogens continue to exist …’ 34 R

Filters and Obstacles in a Historical Perspective of International Law in NEA 41

historical redress. In this respect a number of theories delve into the question of rectification of past injustices.37 Thus, Nozick’s entitlement theory involves enquiring into whether or not property possessed was acquired/transferred in a just manner.38 Equally, one of the most profound contemporary theories on justice viz distributive justice39 does not embrace rectificatory justice as such.40 However, behind Rawls’s veil of ignorance the requirement that if there is a need for historical redress the subjects of such victims should be entitled to historical redress would be agreed upon by all concerned.41 A theory on global rectificatory justice that specifically focuses on past colonial injustices is highly relevant to the historical context of NEA. In this respect Goran Collste’s42 recent comprehensive outline of the theory of rectificatory justice in the colonial context is very timely. Rectificatory justice is concerned with correcting past injustices43 in circumstances where there are ‘identifiable beneficiaries and victims of past injustices in the present.’44 Rectificatory justice is obligatory and not as a matter of charity. The purpose of rectificatory justice is described as: [A] way of realising justice and restoring a moral equilibrium and respect for the victims of past wrongs. Through rectification, former perpetrators of harmful acts will enhance their own international reputation at the same time as restoring their self-respect of the citizens of a nation that is guilty of historical wrongs.45

Rectificatory justice comes into play where there has been a past injustice; a rightful claimant; a subject on whom appropriate responsibility rests; and a relevant temporal framework. The conception of rectificatory justice dispensed depends on the context and what is reasonable and appropriate in the circumstances (including capacity) and therefore what is involved can range from acknowledgment of wrongdoing, apology, ‘truth commissions, affirmative actions, foundations of museums and setting up of memorials for remembering and commemorating past injustices’ to compensation.46 In this sense, rectificatory justice is a broader concept than restorative or compensatory justice.47 Ignorance at the time of the moral nature of the wrong being done is not a defence if the moral nature of the wrong is presently understood.48 Responsibility with respect to historical wrongs

37 

Goran Collste, Global Rectificatory Justice (London, Palgrave/Macmillan, 2015) 116. See R Nozick, Anarchy, State and Utopia (Oxford, OUP, 1974) and reference to his work in Collste, ibid, 116. 39  See J Rawls, A Theory of Justice (Cambridge MA, Harvard University Press, 1971) and J Rawls, The Law of Peoples (Cambridge MA, Harvard University Press, 1999). 40  See Collste, above n 37, 31. 41  See ibid, 29–32. 42 ibid. 43  ibid, 116. 44  ibid, 10. 45  ibid, 15. 46  ibid, 132. 47  ibid, 118. 48  ibid, 125. 38 

42  International Law in the Historical Setting

can rest with the State,49 and is of a transgenerational nature.50 Moreover, individuals as citizens have a civic responsibility to discharge obligations of the State arising from rectificatory justice, independent of their involvement or choice.51 The recipients of rectificatory justice are the present victims of past injustice.52 In so far as descendants of victims of historical injustices are concerned they could be entitled to rectificatory justice if ‘their lives were seriously negatively affected by the harm to their parents.’53 With respect to a temporal framework the limit of this framework is informed by the extent to which the harm is still enduring.54 Harm here is understood in a broad sense to include personal, economic and cultural harm. Finally, rectificatory justice cannot be dispensed through forgiveness on behalf of the victims.55 Where the injustice is of the nature of a peremptory norm certainly in legal analysis it has been observed ‘no act done contrary to such a rule can be legitimated by means of consent, acquiescence or recognition. …’56 Forgiveness however does not legitimate. In sum, the call of rectificatory justice is more far reaching, clearer and comprehensive than the international legal template. It has an important relevance to the circumstances of NEA. The legal framework if it is to deliver a lasting resolution to the various historically-based issues of the region will need to take its cue from this ethical perspective. This is particularly so because the inter-se relations within the region are more driven by such considerations than a sense of legal ennui. This perspective of rectificatory justice however has to be tempered with the notion of ‘sustainable justice’ which does not unduly burden and pressure future generations in its realisation.

III.  Antecedents of International Law in NEA A.  Inter-State Relations in Pre-modern Period The pre-modern period has its origins in ancient China. The most popular glimpse of a segment of the ancient period is 551–479 BC during the Ch’un Ch’iu period between 722–481 BC.57 The reason for the popularity of this period is that it was

49 

ibid, 121. ibid, 122. 51  ibid, 140 citing KC Tan, ‘Colonialism, Reparations, and Global Justice’ in J Miller and R Kumar (eds), Reparations: Interdisciplinary Inquiries (Oxford, OUP, 2007). See also Collste, above n 37, 130. 52  Collste, above n 37, 122. 53  ibid, 127. 54  ibid, 131. 55  ibid, 154. 56  Jennings and Watts, above n 34, Vol 1, 8. 57  See Keishiro Iriye, ‘The Principles of International Law in the Light of Confucian Doctrine’ (1967) 1 Recueil Des Cours 5. 50 

Antecedents of International Law in NEA 43

the subject of a chronicle by Confucius58 spanning as it did his lifetime, in the Chinese classic titled Ch’un Ch’iu (Spring and Autumn Annals).59 In the Spring and Autumn Annals Confucius deliberates on the practice of his State in China called Lu and its relations with other Chinese States.60 For the purposes of chronology this pre-modern period originating in ancient China can be said to extend, albeit in different forms, up to 1860.61 This pre-modern period as a whole has been variously authoritatively deliberated upon within an International Law discourse,62 and the brief account that follows here draws from these works. The ancient period in China was ruled by the Chou (also written as Zhou) dynasty (House of Chou) under which a ‘feudal system’63 has been variously described to have existed. In this system the subordinate units had an unequal relationship with the House of Chou, and the subordinate units had a relationship amongst themselves based on hierarchy of the rulers of these subordinate units, bestowed under the House of Chou.64 This is not different from the reality of international relations in modern times. During this ancient period the nature of the relationship between the House of Chou and its subordinates was in a state of flux with some States rising in their status with the decline in the power of the House of Chou; and eventually leading to a situation where most of the States became effectively autonomous. Today’s ‘super power’ world order has moved into a multi-polar power order. However, the changes in ancient times nevertheless have been described as taking place within a kind of a ‘feudal system’ with the House of Chou remaining nominally at the apex in some ways like the British monarch. Under this state of affairs, a set of practices developed governing the relationships between the different ‘States’ within China and the House of Chou—with each State paying tribute to the House of Chou. During the Ch’un Ch’iu period States outside it were not recognised and were considered as barbarians. However, as between the States within China during the Ch’un Ch’iu period relations were governed with reference to a set of rules that reflect some fundamental practices and rules of contemporary International Law. These rules comprised of ‘codes of morals, rites, legal rules and law’ derived from ‘the private domain of family, person and human behaviour’ known under Confucianism as Li.65 The practices and rules that assimilate to contemporary International Law include diplomatic

58  Confucius was responsible for the ethical system Confucianism. Confucianism spread in Korea and Japan. In Korea it became the Chosŏn Dynasty’s state doctrine. 59  See Iriye, above n 57, 5. 60  ibid, 5. 61  Wang Tieya, ‘International Law in China—Historical and Contemporary Perspectives’ (1990) 11 Recueil Des Cours. 62  See in particular Iriye, above n 57; Tieya, ibid; and Masaharu Yanagihara, ‘Significance of the ­History of the Law of Nations in Europe and East Asia’ (2014) 371 Recueil Des Cours 317–49. 63  ‘Feudal’ is a value-laden term and can be a relative concept tainted through contemporary lenses. As a description of a unit it does not take into account the physical conditions of the time (including ­transport/communications and general administrative levels of the time). 64  Iriye, above n 57, 6. 65  ibid, 8.

44  International Law in the Historical Setting

missions, diplomatic immunity of negotiators; agreements based on consent not force; use of force only to attain peace; regulation of armaments; a system of recognition of States under the House of Chou; prior consent of a State for passage through its territory; prohibition on the diversion of the flow of inter-State rivers; availability of third party dispute settlement; system of extradition of criminals; a framework for collective sanctions; co-operation between States in different spheres; and a League of States for multilateral agreements.66 All this underlined with a long term vision of a utopian world government (viz, Ta Tung).67 In 221 BC (known as the Middle Kingdom) however the whole of China was assimilated under the one rule of the Qing dynasty (1644–1911) and this one China had relations with countries in the region, including Korea (Chosŏn Dynasty (1392–1910)) and Japan (the latter intermittently),68 that had particular cultural and political affinities with China, under the Tribute System.69 Paying tribute resulted in the recognition of the legitimacy of the State paying tribute. In 2017 upon Trump’s inauguration in the US the British Prime Minister shortly thereafter made a State visit to the US and returned with the promise of better trade relations with the UK. Is this a contemporary example of a Western Tribute System? The practice of paying tribute in the Ch’un Ch’iu period developed over the years with various formalities including a ritual known as Kotow. The relationship between China and other countries under this Tributary System has been described as being in accordance with: Confucian doctrine of benevolence and obedience based on Three Bonds—bonds of father and son, husband and wife, and prince and minister … China acted like a parent and expected the surrounding countries to respect and obey just like its children.70

The Tributary System came to an end in 1911 upon the demise of the Qing Dynasty.71 According to one analysis, it involved in fact an informal free trade area between the Tributary States thus excluding Western States not willing to pay tribute to China.72 It was for this reason that the latter imposed unequal treaties on China so as to facilitate trade with it. The critical International Law question with respect to this ancient Chinese era relates to the very existence of International Law during this period. Before addressing that question some brief observations need to be made about the significance of this seemingly historic question to discourse in contemporary 66 ibid. 67 ibid.

68  From the sixteenth century onwards, Japan maintained only trade relations with China. See The China-Japan-Korea Common History Text Tri-National Committee, A History to Open the Future: Modern East Asian History and Regional Reconciliation (University of Hawai‘i at Mānoa School of Pacific and Asian Studies, Kindle Edition, 2015) Kindle Locations 481–90. 69  Tieya, above n 61, 213. 70  ibid, 221. 71  ibid, 220. 72  Rune Svarverud, International Law as World Order in Late Imperial China: Translation, Reception and Discourse, 1847–1911 (Leiden, Brill, 2007) 11.

Antecedents of International Law in NEA 45

International Law. First, the question is relevant to a consideration of the oftentimes repeated assertion that International Law was first ‘introduced’ into NEA in the nineteenth century.73 Second, it is relevant to a consideration of the equally often repeated assertion that International Law originates in the advent of the State system in Europe post Peace of Westphalia in 1648, and that modern International Law has its basis in western civilisation.74 Third, it is important from the point of rectificatory justice, if the historical facts have effectively been hijacked and/or distorted—for those who arrogate the very invention of International Law (or for that matter sleep walk into this version of history) seek to patronise its application and/or create and perpetuate a circumstance of cultural humiliation. This is, to borrow an analysis, ‘a kind of cultural injustice whereby “concepts and categories” providing self-understanding and orientation are replaced and marginalized by a dominant power.’75 Finally, generally historical context has a bearing on our understanding of international norms and the international legal system. Is ancient history per se however somewhat removed from this context? To some extent perhaps—but not utterly. In sum, the query into the existence of International Law in ancient China is a question about who invented International Law, and as such is not anachronistic. Regrettably the layers of unquestioned assertions over the years that the origins of modern International Law are exclusively European has seeped into the psyche of generations of International Law scholars, such that the task of unpacking the true picture is a real challenge—although slowly there is an unpeeling of the layers mainly from critical theoretical international scholars.76 The recent very eloquent UN Audio-Visual lecture given by Judge Hisashi Owada of the International Court of Justice is also of note wherein the reasons for the perception of International Law as being Christian/European by and for ‘civilised’ nations are given.77 The origins of this claim are attributed to the writings of classical international lawyers such as Hugo Grotius, Francisco de Vitoria and Henry Wheaton whose perspective of International Law was set in natural law in particular Judaeo-Christian traditions; as a justification for the expansion of Europe and coloured with a racist view of other races.78 In the case of Japan in its first encounter with the Law of Nations the Japanese found resonance in it in their understanding of the Chinese translated work of Wheaton’s book on International Law by Reverend Martin with their own Confucian principles.79 73  See for example Phil CW Chan, ‘China’s Approaches to International Law since the Opium War’ (2014) 27 Leiden Journal of International Law 859–92. 74  Jennings and Watts, above n 34, Vol 1, 4: ‘International Law in the meaning of the term as used in modern times began gradually to grow from the second half of the Middle Ages.’ See also for example Shaw, above n 3 and Tieya, above n 61, 204. 75  Collste, above n 37, 5. 76  See for example the seminal work of Yasuaki, above n 4, specially ch IV. 77  Judge Hisashi Owada, ‘The Encounter by Japan with the Community of Civilised Nations’, UN Audio-visual library of International Law (2017) http://legal.un.org/avl/ls/Owada_IL_video_1.html. 78  Owada, ibid. 79  Owada, ibid.

46  International Law in the Historical Setting

In the circumstances, there are mainly three different stand-points on the question whether the ‘inter-State’ practices in the ancient epoch of pre-modern China can be described as one of International Law. First, that the Law of Nations was the same as Confusion universal principles and that therefore International Law existed in ancient China.80 Second, that for some period different civilisations (viz Chinese, Islamic, European) purported to apply their own set of international norms in their relations with others.81 In other words, different sets of regimes of International Law co-existed. Third, that the practices resembled International Law in a rudimentary way.82 And finally, there is the assertion that there was no International Law in ancient China.83 Thus, according to Keishiro Iriye there did not exist in ancient China an inter-state legal system similar to that of international law as we know it today. In ancient China a feudal system, with distinctive legal and political characteristics, prevailed … There was no international law based on equality of sovereign states in the Chou order.84

In the same vein, Wang Tieya observes: Taking international law in its modern sense, they can in no way be its principles and rules. States in those periods were under a feudal system and, though with some degree of independence, were not sovereign States. It has been aptly pointed out that, in their relations, there was ‘inter but no nations.’ Such practices and usages were not systematic in nature and had no connection at all with the present principles and rules of international law. In the case of China, the periods of Spring and Autumn and Warring States came to an end in 221 BC when the whole country was unified under the rule of Qin Emperor. Thenceforth, the interstate practices and usages could not be possible and there were no traces of international law until the middle of the nineteenth century.85

With respect to this denial of International Law stance a number of observations need to be made. First and foremost, any query as to the existence of International Law whether contemporary or ancient has to be set against a conception of law.86

80  For example, Iriye, above n 57, refers at 6–7 to Dr Tetsu Izumi, ‘International Custom of the Ch’un Ch’iu Period’ 27(3) Koku-saiho Gaikozasshi 205; dr Shingo Nakamura, ‘On International Law in the Ch’un Ch’iu and Chan Kuo Period, etc’ (8)92 Kokka Gakkai Zasshi 827; Hung Chun-P’ei, Chun Ch’iu International Law (Shanghai, 1939) 27; and Chang Hsin-Ch’eng, Ch’un Ch’iu International Law (Peking, 1924) 2. See also Eric Yong-Joong Lee, ‘Early Development of Modern International Law in East Asia—With Special reference to China, Japan, and Korea’ (2002) 4(42–76) Journal of the History of International Law 44. 81  Yasuaki, above n 4, ch IV. 82  The possibility is suggested though not advocated as such by Tieya, above n 61, 213. 83  Iriye, above n 57, 5–6; Tieya, above n 61, 213; and A Nussbaum, A Concise History of the Law of Nations (London, Macmillan, 1954) 10 and EA Korovin, International Law (Academy of Science of the USSR, 1960) 27 (the latter are cited in Tieya, above n 61 and Yong-Joong Lee, above n 80). 84  Iriye, above n 57, 6. 85  Tieya, above n 61, 213. 86  This is a point also taken up by Yanagihara, above n 62, 286–316. However, his observation that the concepts ‘law’, ‘State’, and ‘sovereignty’ were ‘virtually invented in modern Europe’ at 290 is not accepted. These are universal concepts that no one race has a monopoly of in their invention.

Antecedents of International Law in NEA 47

For example, from the perspective of law as a process there is little difficulty in asserting that there was International Law in ancient China. Even from the standpoint of law ‘defined as a body of rules for human conduct within a community which by common consent of this community shall be enforced by external power’;87 there is an argument for contending the existence of International Law. Thus, leaving aside the nature of the community for the present, ancient China more or less satisfied the three conditions here viz of a ‘community’, of norms and enforcement apparatus. In fact, looked at from the point of view of substance, the norms not only reflect fundamental principles and practices of modern ­International Law but evidence an expectation of a high degree of civilised State behaviour given the time framework in which they existed. Second, the primary objection to a characterisation of the existence of International Law in ancient China has been the constituents of the particular community/ society or more precisely in terms of the objection formulated—the genre of ‘States’ in this era, as well as it seems the number of ‘States’ in the later part of the pre-modern epoch. This analysis draws from the European paradigm of International Law set in the sixteenth century, wherein European States were pounding the drum beats of sovereignty and independence, to characterise a circumstance in another time and civilisation. Moreover, the condition of sovereignty/equality and independence as an attribute of a State as a sine qua non for the determination of International Law appears more as a knee-jerk reaction rather than founded in some theoretical framework or indeed historical evidence. Thus, the historical take on this is as follows: Diplomacy between China and its neighbors was based on the so-called tribute system in which a neighboring country would send precious items to China as ‘tribute’, and in return China would confirm the legitimacy of that country’s king and send back return gifts. China normally did not intervene in the other countries’ domestic affairs and thus the sovereignty of neighboring countries was normally respected under this system. Japan, from the sixteenth century onward, maintained only trade relations with China, and was therefore no longer part of the tribute system. Close relations among the three countries were sustained through these loose arrangements.88

International Law recognises subjects with different degrees of personality. Indeed, modern International Law not only has a catholic approach to the genre of subjects in the international society; but also, the subjects are evolving in character, 87 

Jennings and Watts, above n 34, Vol 1, 9. A History to Open the Future, above n 68, Kindle Locations 481–90. See also Phil CW Chan, China, State Sovereignty and International Legal Order (Leiden, Brill Nojhoff, 2015) 70: ‘Randle Edwards argues that substantive equality, reciprocity, and territorial integrity were in fact observed by Qing China in its relations with tribute states, even if such relations still manifested a hierarchy in which China was unquestionably leader and protector.’ See also R Edwards, ‘The Old Canton System of Foreign Trade’ in VH Li (ed), Law and Politics in China’s Foreign Trade (Seattle, University of Washington Press, 1977) 360; R Edwards, ‘Imperial China’s Border Control Law’ (1987) 1 Journal of Chinese Law 33; R Edwards, ‘China’s Practice of International Law—Patterns from the Past’ in R St J Macdonald (ed), Essays in Honour of Wang Tieya (Dordrecht, Springer Netherlands, 1994) 243. (Citation from Phil CW Chan). 88 

48  International Law in the Historical Setting

for instance from States to blocs. Additionally, States have not only de facto different degrees of sovereignty/independence and equality but also formally, as members for instance of the UN, and through weighted voting systems in regional and international organisations. Indeed, from the stand-point of sovereignty as a sine qua non for the existence of International Law as such, it could be said that there is no International Law in modern times, given that some States have a greater voice in the UN Security Council than others—the UN being the overarching institutional cloak of the community of nations. Equally, the modern European integration project by this notion could be described as a retrograde ‘back to Feudalism’ state wherein different members have differing degrees of sovereignty. Indeed, in some cases the sovereignty is lacking in essential thresholds of sovereignty measured in terms of States outside the EU. There is in fact here a conflation of the rights of a State qua State rights under International Law (including the necessary attributes of a State for Statehood under International Law) and the configuration of those rights as an attribute of the State for the purposes of establishing the existence of International Law and/or a system of International Law. In short there can be International Law in a hierarchical system of subjects of International Law, just as there is International Law in a condition of a kind of horizontal equilibrium. There is nothing in the nature of International Law or the system of International Law that precludes the existence of a hierarchical system of States. In the same vein, there is nothing in International Law that precludes the international community to evolve into aggregates of States comprising blocs. International Law will not wither away upon such an evolution if all States unify. Conversely a nascent system of International Law comprising of a bric-a-brac of subjects or blocs of States under a system of International Law (however internally formed and externally oriented) does not augur a miscarriage of International Law. In the same vein, a number of commentators have acknowledged an International code in ancient China up to the point when China was unified under the Qin dynasty.89 It is not clear why International Law should cease in the region when China was unified, yet before the Reformation at any rate according to Rune Svarverud, the ‘law of nations was the law of Christendom before Reformation.’90 International Law in the region did continue under the Tributary system. More­ over, there is no logic founded in the nature of International Law that precludes the existence of International Law upon the survival of only one State. This is a very State-centric paradigm of International Law. As Judge Cançado Trindade points out International Law is in fact ‘centered on the human person’91—and from this human rights paradigm of International Law, the existence of only one State does not extinguish the purpose of International Law, since the affairs of the human person continue albeit in the form of one State in the region. 89  See Svarverud, above n 72, 99 and 155 referring to Martin’s Preface to Wheaton’s work. See also Tieya, above n 62, 213. 90  Svarverud, above n 72, 59. 91  Dissenting Opinion, Judge Cançado Trindade para 40.

Antecedents of International Law in NEA 49

In conclusion, both ancient China and the subsequent Tributary System that developed, evidence the existence and practice of International Law in NEA in the pre-modern period of the history of the region.92

B.  International Law in NEA in Modern Times i.  Preliminary Observations In most historical accounts of International Law in NEA this epoch from the nineteenth century is described as the time when International law was first ‘introduced’ in the region.93 This section however is not titled as such—as the description of an ‘introduction’ of International Law into the States in NEA respectively or ­collectively, implies an existing vacuum of International Law in the region. Such vernacular panders to the paradigm of an exclusive ‘civilised’ International Law to which the ‘uncivilised’ world could only be introduced to as a civilising act and even as such as a matter of grace. This paradigm belongs in the waste paper bin of history where it needs to remain. A system of International Law in NEA already existed. The region had a framework with respect to the governance of relations with outsiders. Outsiders were ‘barbarians’ and therefore could be dealt with differently—in the same manner as the approach taken by the socalled ‘civilised’ European International Law towards ‘uncivilised States’. In effect, there were several regimes of International Law existing including the European/ American system of International Law.94 These different regimes were in their confrontations involved in a process of resolving issues of hierarchy and/or imposition. Thus, as Andrew Lang puts it, (albeit in a different discourse and drawing on Martti Koskenniemi): [P]rocesses of interaction between international legal regimes involve contested normative choices between competing political prospects (K). Different legal regimes tend to have different normative biases, so that ‘coordination’ between regimes is therefore always about hierarching those preferences in particular contexts.95

In the case of NEA, one regime preferences were operative to the extent that they were, but as a consequence of a hegemonic intent and not any sense of inherent universal validity. As Koskenniemi puts it: Law is a surface over which political opponents engage in hegemonic practices, trying to enlist its rules, principles and institutions on their side, making sure they do not support

92  See also Yasuaki, above n 4, Ch IV for the argument that there existed a system of International Law during this period and that it is inappropriate to project existing notions of International Law into this era when at the time the modern paradigm of International Law did not exist. 93  See for example Tieya, above n 61, 226; and Yong-Joong Lee, above n 80, 43. 94  See for example Yasuaki, above n 4, Ch IV, 357. 95 See Andrew Lang in Margaret A Young (ed), Regime Interactions in International Law (Cambridge, CUP, 2012) 113.

50  International Law in the Historical Setting the adversary. In order to bring that perspective into focus, analysis must be shifted from rules to broad themes of legal argument within which hegemonic contestation takes place.96

Martti Koskenniemi’s observation was well understood in Japan as long ago as 1913 as pointed out by Yanagihara when he refers to Sakuye Takahashi’s writings wherein the author ‘realized abundantly clearly that principles and rules of international law were sometimes invoked, and sometimes on purpose were not invoked, by Europeans, ‘the civilized people’, as a political bargaining chip in encounters with Asia.’97 This hegemonic hijacking of ‘International Law’ is reinforced by the manner in which the possible consequences of enlightening China with International Law through the translation of one of the first International Law text books introduced in China was conceived in certain quarters. Thus, it has been observed: The United States embassy in China was concerned that Martin’s work might enable the Chinese to ‘endeavour to apply [international law] to their intercourse with foreign countries’ and appreciate ‘how greatly the principle of extraterritoriality contained in their treaties modifies the usage in force between the Western and Christian powers’. The chargé d’affaires of the French legation in China was incensed: ‘Who is this man who is going to give the Chinese an insight into our European international law? Kill him— choke him off; he will make us endless trouble’.98

In fact, the question of the timing of the ‘introduction’ of ‘International Law’ in the region has to be understood not only in terms of its introduction but also in terms of the question whether it was so received in the region as such.99 Thus, for a while the Qing dynasty considered itself merely as indulging the western barbarians when entering in unequal treaties with them whilst maintaining the Tributary System relations with other countries in the region.100 In the same vein, the J­ apanese accepted it as being the same as their own Confusion traditions, and for that reason acceptable to them.101 Moreover, the claim of an introduction of a Christian,102 civilised and modern (in the positive sense of enlightened) International Law has also been refuted. [T]he Peace of Westphalia in 1648 laid the basis for an agnostic, procedural International Law whose merit consisted in its refraining from imposing any external ­normative

96  Martti Koskenniemi, The Politics of International Law (Oxford, Hart, 2011) 223. See also at 265 wherein he states: ‘International law exists to advance the repertory of substantive values, preferences, and practices that those in dominant positions seek to realise in the world.’ 97  Yanagihara, above n 62, 347. 98  Chan, above n 73, 869. 99  Yasuaki, above n 4, Ch IV. 100  ibid, Ch IV, 342. 101  Owada, above n 77. 102  See for example Tieya, above n 61, 355: ‘It is an undeniable fact that modern international law has its origins in Europe and it is the product of Christian civilisation.’ See also Svarverud, above n 72, 21.

Antecedents of International Law in NEA 51 ideal on the international society. The objectives of that society would now arise from itself and not from any religious, moral or political notions of the good given externally to it.103

International Law in this era was in fact minimalist in terms of intra-State affairs; and fairly laissez-faire in terms of the nature and quality of the inter-State relations promoted. To the extent that there was a practice in International Law that developed out of the practice of the European States with which NEA was embraced at this time, this practice was not out of any Christian theocracy but arose rather from the particular exigencies giving rise to the normative development through States that happened to inherit a Christian background. Moreover, this International Law came to be accepted or imposed depending on the stand-point in NEA only in the late nineteenth century.104 Thus, the precise manner of the European model of International Law prevailing over NEA can be conceived on the one hand as its imposition by the more powerful—this is the view subscribed to my Onuma Yasuaki.105 Another explanation can be that there was an agreed process as between the different parties to accept certain international norms. However, Onuma Yasuaki asserts that there is no historical evidence to substantiate the assumption that there was a universal conception of what a treaty was, and in particular its underlying tenet pacta sunt servanda.106 Be that as it may, all civilisations, both internally, and with reference to the manner in which they engage in relations with others, have some form of mechanism for locking into some form of foreign relations. These may range from being consensual to unilateral to quasi-consensual to quasi-unilateral. The important point is that there is some kind of locking in even if there are different perceptions of the nature of the locking in. Thus, at the least even if a universal conception of a treaty and its underlying pacta sunt servanda tenet did not exist (although slight variations in conceptions should surely not matter), there was some comparable basic process common to all, albeit perceived differently, which resulted in a set ordering of affairs. It is this, albeit a minimal function, that is set universally. The content of what is infused through this process is the specific substantive content of a particular order not necessarily a particular legal system itself as such.

ii. The Reception and Dissemination of Western Interpretations of International Law in NEA107 The systematic dissemination of western interpretations of International Law into NEA first began in China in the 1860s, upon the translation of Henry ­Wheaton’s

103 

Koskenniemi, above n 96, 243. Yasuaki, above n 4, Ch IV, 357. 105  A view subscribed to by Yasuaki, ibid, ch IV. 106 ibid. 107  See Svarverud, above n 72, 48; Nam-Yearl Chai, ‘Korea’s Reception and Development of International Law’ in Chae-sik Pae, Nam-Yearl Chai, Choon-Ho Park (eds), The Historical Background to the 104 

52  International Law in the Historical Setting

Elements of International Law, by VAP Martin, an American missionary.108 Henry Wheaton was an American diplomat and scholar109 and his work had a practical orientation to it.110 Indeed, his work was only approved for publication when the Chinese could understand from it that they had a good case in International Law with respect to a maritime jurisdictional issue confronting them vis a vis ­Prussia, which had seized a Danish ship in Chinese maritime jurisdiction.111 Wheaton’s work was subsequently introduced in Japan in the 1860s.112 Thereafter, the ­Japanese edition of Wheaton’s book was introduced into Korea, but it seems some years later in 1881.113 A number of observations need to be made here. First, the process of translation into Chinese had to surmount certain linguistic challenges of the time. Thus, as Rune Svarverud observes, it is important to understand that terms do not ‘easily translate from one language to another to yield in the target language a sematic entity equivalent to the one in the source language.’114 Second, given the medium of translation being a missionary, there was a Christian missionary zeal to it set in an erroneous equation of International Law with Christianity.115 Thus, this zeal has been attributed to the characterisation of the existence of International Law, or at any rate an international code,116 in ancient China, by Martin in his preface to Wheaton’s work. This characterisation served as a means of persuading China of the merits of the Western interpretation of International Law, given their own historical involvement with it.117 Third, in some measure the choice of the textbook identified for translation would also inform the impression created in China of how the West interpreted International Law. However, the suggestion that ­‘Wheaton’s was not merely a commentary on international law; it was international law in the Chinese mind’118 needs more substantiation. Moreover, it implies that the Chinese were incapable of making the distinction between a commentary on International Law and the work itself as a source of International Law. Although western literature was first introduced in China, the Chinese experience of this was later further reinforced through its importation from Japan,

Development of International Law in Korea (Berkeley, University of California, 1981); Alexis ­Dudden, Japan’s Colonization of Korea: Discourse and Power (Honolulu, University of Hawai’i Press, 2005); Masaharu Yanagihara, ‘Japan’ in B Fassbender and A Peters (eds), The Oxford Handbook of the History of International Law (Oxford, Oxford University Press, 2012); and Yanagihara, above n 62, 317–49. 108 

See for example Tieya, above n 61, 230. Dudden, above n 107, 32 110  Svarverud, above n 72, 48. 111  ibid, 90. 112  ibid, 93. 113  Chai, above n 107, 12. 114  Svarverud, above n 72, 4 and 176. 115  ibid, 98–99. 116  ibid, 155. 117  ibid, 98. 118  See Chan, above n 73, 869. 109 

Antecedents of International Law in NEA 53

via returning Chinese students from Japan, in the 1890s.119 During this time Meiji Japan120 had embraced the West more enthusiastically.121 The dissemination of western interpretations of International Law in NEA has to be distinguished from the historical response in NEA to such an interpretation. The two can be related to the extent that a positive response to it, as with the Japanese embrace, could be commensurate with better insights into it. Equally an attitude to western interpretations of International Law must be distinguished from attitudes to engaging in foreign relations. Attitudes to western interpretations of International Law could inform approaches to foreign relations. Thus, in Korea, western interpretations of International Law were initially conceived of as facilitators of imperialism and resisted until the early 1880s.122 Thereafter, it was embraced as a matter of choice.123 On the other hand, foreign relations in China and Japan were opened under the shadows of gun boat diplomacy.124 However, after its initial inhibitions to foreign relations, Japan embraced Western interpretations of International Law with much enthusiasm, as it understood the framework of International Law to be permissive of colonisation—a process which Meiji Japan wanted to engage in itself.125 Thus, it has been observed: It is the common understanding now among Japanese specialists in history and ­international law that Japan achieved a distinct ‘success’ in accepting modern European international law in the Meiji era (1868–1912), in marked contrast to the unequivocal failure of its reception in modern China and Korea.126

iii.  Outline of Historical Inter-se and External Relations in NEA127 The historical relations as between the States in NEA and their relations respectively with the outside world post the Tributary System, was informed both by the exigencies of external relations, as well as the internal political developments within China, Korea and Japan. The purpose of this account is to provide the ­relevant historical material in order to facilitate an analysis of problems and issues in the region embedded in history from the perspective of International Law. It is not intended as a historical outline per se which is well documented elsewhere.128 However, the chronology of relevant epochs can be described as the period of

119 

Svarverud, above n 72, 74. during which Japan underwent changes from a feudal society to a modern state. This period coincided with the reign of the Emperor Meiji. (Source: https://en.wikipedia.org/wiki/ Meiji_period). 121  Svarverud, above n 72, 74. 122  Chai, above n 107, 7. 123  ibid, 10. 124  ibid, 13. 125  Dudden, above n 107, 3 and 8. 126  Yanagihara, above n 62, 338. 127  A History to Open the Future, above n 68, Kindle Locations 631–32. The brief history that follows here draws from this work. 128  ibid, Kindle Locations 631–32. 120  1868–1912

54  International Law in the Historical Setting

unequal treaties; the colonial period of Japanese incursions into China and Korea; and finally, the post-World War Two episode. The need to respond to external challenges in NEA arose around the 1840s when certain unequal treaties were imposed on China, and in so doing were threatening the Tributary System.129 The backdrop to these treaties was the desire of certain Western countries namely Britain, the US, Russia, France and Germany to open up their trade with NEA, since Chinese goods were greatly in demand in the West but Western countries on the other hand were unable to export to China.130 ­Britain upon colonising India resorted to smuggling opium from India to China; and the US joined in this practice.131 The opium smuggling resulted in many Chinese nationals becoming addicted but did result in changing the West’s trade deficit with China into a surplus.132 The Chinese responded with countermeasures including the burning of opium. This prompted Britain to invade China to facilitate trade by force—forcing China to sign the first unequal treaty involving inter alia the ceding of Hong Kong, and the opening up of Guangzhou, Fuzhou, Xiamen, Ningbo and Shanghai for duty free trade into China, including the unconditional application of the most-favoured-nation standard.133 Other unequal treaties followed upon further confrontations (including the second Opium War (1856–60) and the Sino-French War (1884–85), involving initially Russia, Germany, France134 and the US.135 Effectively these Western powers commanded different parts of China: ‘Britain along the Yangtze River, Germany on the Shandong Peninsula, France in coastal Guangdong, and Russia in Manchuria.’136 These unequal treaties were imposed by force.137 They involved inter alia giving up parts of Chinese territory, and accepting the extraterritorial application of foreign law to foreigners in China (known as a system of extraterritoriality).138 Upon the Chinese defeat, Japan learnt lessons from these events, including the arrival of US warships in Japan in 1853. In such circumstances Japan opened itself up upon signing a number of unequal treaties, including with Britain, Russia, France and the Netherlands.139 In fact not only did Japan open itself up for trade, but it also engaged proactively in a modernisation process; including internal political reforms, departing from the feudal Shōgun and daimyō-based political system, and concentrating power in one government headed by the Emperor.140 Korea under the Chosŏn dynasty

129  130 

Tieya, above n 61, 354. A History to Open the Future, above n 68.

131 ibid. 132 ibid. 133 

Treaty of Nanjing 1842.

134 1844. 135 1844. 136 

A History to Open the Future, above n 68. See for example Tieya, n 61, 251; Chan, above n 73, 868. 138  A History to Open the Future, above n 68. 139 ibid. 140 ibid. 137 

Antecedents of International Law in NEA 55

also resisted Western approaches to open up, but was forced to open up its ports by Japan, with the blessing of Western countries, upon signing the unequal treaty viz the 1876 Korea-Japanese Treaty of Amity (the Treaty of Kanghwa). Article 1 of the Treaty of Kanghwa specifically referred to Korea as a sovereign State, so as to displace the tributary relationship of Korea with China.141 Korea thereafter ended up establishing diplomatic relations with a number of Western countries (including the US, Britain, France and Germany and Russia) based on unequal treaties. With reference to these unequal treaties, Wang Tieya observes: They brought to China international law which they applied among themselves, but they did not apply it to China, or, they applied only those principles and rules which they could make use of in their activities of oppression and exploitation.142

This is of course accurate in the reference to ‘oppression and exploitation’ but somewhat misleading in the description of the transmission of International Law. The advent of unequal treaties did not serve as a conduit for the transmission of General International Law. They were in fact considered as a temporary indulgence to the Western barbarians and relations with other Asian States continued within the framework of the Tributary System.143 Moreover, only the expressly stated provisions were recognised in these agreements and not the corpus of International Law within which they were set.144 Thus, Phil CW Chan observes: China’s signing of these treaties should not be construed as signifying its acceptance of international law, as treaty obligations operated between the parties only and were not to form part of the corpus of general international law, particularly when treaties that China entered into with foreign powers during the nineteenth century were all bilateral.145

The unequal treaties lasted for around a hundred years until 1943, when the ­Peoples Republic of China denounced them as unequal and void, without much objection from the Western States involved.146 Whilst these agreements are now mainly of historic interest as a matter of legal analysis their validity would be considered in terms of the Law of Treaties at that time.147 From this perspective the imbalance of the terms per se is not a ground for invalidity of such treaties.148 However, as part of a process of rectificatory justice could the States in NEA impose now, for example, an ‘Opium or Unequal Treaty Tariff ’ on the trade from certain countries implicated in the unequal treaties under Article XX of GATT 1994 viz the moral exception?

141 ibid. 142 

Tieya, above n 61, 257. Yasuaki, above n 4, Ch IV particularly 342. 144  ibid, Ch IV, 341. 145  Chan, above n 73, 868. 146  Tieya, above n 61, 339. 147  Island of Palmas Case (PCA: 1928). For a European perspective on unequal treaties see for example P Wesley-Smith, Unequal Treaty 1898–1997: China, Great Britain and Hong Kong’s New ­Territories (Oxford, OUP, 1980) 184–85. 148  Wesley-Smith, ibid 184–85. 143 

56  International Law in the Historical Setting

The era of unequal treaties in NEA was accompanied by the advent of ­Japanese colonial engagements within NEA, with Japanese incursions into Korea and China.149 Thus, in 1871 Japan forcefully incorporated the Ryukyn Kingdom located south of Japan into Japan. In 1894 Japan went to war with China over Korea against a background of Chinese and Japanese rivalry over influence in Korea. The outcome of this was in favour of the Japanese, resulting in the Treaty of Shimonoseki 1895, ending the Sino-Japanese War.150 This treaty resulted in various concessions by China to Japan, including the recognition of Korea as an independent State, the ceding of certain Chinese territories, including Taiwan, and the opening up of certain Chinese ports to Japan.151 In 1900 Japan also went to war, along with Britain, Germany, Russia, France, the US, Italy and Austria against China in response to Chinese containment of the advance of Christianity in China. This war ended with the Chinese defeat and the signing in 1901 of the Boxer Protocol (the Peace Agreement between the Eight-Nation Alliance and China) resulting in various territorial concessions by China to the allied countries. As to the law applicable as between China and Japan at this time with reference to these issues, Thomas E Holland posited an important question: Are China and Japan with reference either to one another or to the Powers, subject to the duties which are recognised as subsisting between the States of Europe? We come here upon a large question, no less than the essential character of International Law, and the sphere of its operation.152

Normally, the issues would be considered in the light of the law contemporaneous with the facts. This would be International Law (in particular the law on treaties and the use of force) at the time, as informed by the regional context including regional norms. This was, it will be noted, a time prior to when International Law developed to prohibit the use of force. Between 1904 and 1905, Japan and Russia went to war over the control of Korea (the Russo-Japanese War). The war ended with the Russians suffering defeat with territorial losses culminating in the Portsmouth Treaty 1905. This war was fought in Korea and northeast China. Following the Russo-Japanese War, Japan began the process of reducing Korea into a protectorate. This process involved the signing between Korea and Japan of the Protectorate Treaty 1905, during the presence of Japanese troops in Korea. This was followed by the 1910 Annexation Treaty, completing the colonisation process of Korea in 1910. The legality of these agreements as well as the consequential colonisation of Korea by Japan are the subject of some disagreement as between Korea and Japan. As the agreements were concluded ­during Japanese occupation of Korea and in circumstances involving 149 

A History to Open the Future, above n 68.

150 ibid. 151 ibid.

152  See Svarverud, above n 72, quoting TE Holland from his book Studies in International Law (1898), 113.

Antecedents of International Law in NEA 57

Japanese coercion on Korean government representatives, Korea regards these agreements as void.153 Indeed, the Protectorate Treaty 1905 is given as an example in an ­International Law Commission Report to the UN General Assembly wherein coercion was used against a representative of a State to induce consent.154 This would be significant if coercion of representatives was a ground for rendering a treaty void in 1905. It seems that the rule on coercion of a representative vitiating consent has a basis in Customary International Law.155 Whilst the distinction between coercion of the State and its representatives can sometimes be difficult to make, with respect to invalidity as a consequence of coercion of the State, the ILC commentary on the draft Vienna Convention on the Law of Treaties makes clear as follows: The traditional doctrine prior to the Covenant of the League of Nations was that the validity of a treaty was not affected by the fact that it had been brought about by the threat or use of force. However, this doctrine was simply a reflection of the general ­attitude of international law during that era towards the legality of the use of force for the settlement of international disputes. With the Covenant and the Pact of Paris there began to develop a strong body of opinion which advocated that the validity of such treaties ought no longer to be recognized.156

In sum, it will be noted that this was still a time when International Law disciplines on the use of force were permissive. However, be that as it may, the legal consensus in the region as to the legality of the Japanese annexation has been described in one Korean source, as follows: There is general agreement among researchers that the Protectorate Treaty was concluded under duress. However, opinions differ as to whether or not the 35 years of

153 

A History to Open the Future, above n 68. Report of the International Law Commission on the work of its Fifteenth Session, 6 July 1963, Official Records of the General Assembly, Eighteenth Session, Supplement (A/5509) on Law of Treaties. The Commentary to Art 35 reads as follows: ‘Personal Coercion of representative of States: ‘There appears to be general agreement that acts of coercion or threats applied to individuals with respect to their own persons or in their personal capacity in order to procure the signature, ratification, acceptance or approval of a treaty will necessarily justify the State in invoking the nullity of the treaty. 4. History provides a number of instances of the alleged employment of coercion against not only negotiators but members of legislatures in order to procure the signature or ratification of a treaty. Amongst those instances the Harvard Research Draft lists: the surrounding of the Diet of Poland in 1773 to coerce its members into accepting the treaty of partition; the coercion of the Emperor of Korea and his ministers in 1905 to obtain their acceptance of a treaty of protection; the surrounding of the national assembly of Haiti by United States forces in 1915 to coerce its members into ratifying a convention.’ (Footnotes omitted). It is however misleading to refer to this as ‘the United Nations General ­Assembly’s 1963 decision to acknowledge the invalidity of the Convention of 1905 …’ as does Yi Taejin, in ‘Forced Treaties and Japan’s Annexation of the Great Korean Empire: An Argument for the Illegality of the Annexation,’ in International Legal Issues in Korea-Japan Relations (Northeast Asian History Foundation, 2008) https://www.nahf.or.kr/?bmode=view&search=Y&s_word=law&mode=all&board=& menulev=&didx=&bname=&sidx=240&page=2&bidx=121&stype=2. 155  See for example I Sinclair, The Vienna Convention on the Law of Treaties (Manchester, MUP, 1984); Giovani Distefano, ‘Article 51 Coercion of a Representative of a State’ in Olivier Corten and Pierre Klein, A Commentary of Vienna Conventions on the Law of Treaties (Oxford, OUP, 2009). 156  UN Document A/5509 (12 July 1963). 154  See

58  International Law in the Historical Setting colonial rule that followed ‘annexation’ were legally valid under international law. While Korean scholars think that it was illegal, Japanese scholars are divided over the issue.157

To some extent this legal discourse might have been considered somewhat academic since Article II of the Treaty on Basic Relations between Japan and the Republic of Korea 1965 specifically states: ‘It is confirmed that all treaties or agreements concluded between the Empire of Japan and the Empire of Korea on or before August 22, 1910 are already null and void.’ However, to note, there is some disagreement as to the interpretation of ‘null and void’ in this provision.158 A recent observation by a Japanese author in this respect is of note: In 1905 the Protectorate treaty was concluded, followed in 1910 by a treaty of annexation. The validity of the treaties is still now bitterly discussed. One of the main issues is whether we had a that time a distinction between the existence of coercion upon the State/Government or individuals/officials. This issue was not entirely settled even by the 1965 Treaty between South Korea and Japan.159

Japan occupied Manchuria in 1931. This occupation was condemned by the League of Nations Assembly but instead of complying with the League’s decision,160 Japan withdrew from it in 1933. Japan established the Puppet State of Manchukuo in 1932, in Manchuria. This state of affairs lasted until the end of the Second World War in 1945. In 1937 Japan used its presence in Manchuria to begin its invasion of the rest of China. This was followed by Japan formally entering into a pact with Germany and Italy in 1940 (Tripartite Pact), and launching into a war for the conquest of former European colonies in Southeast Asia. In the periods during the two World Wars, NEA was affected in different ways. During the Second World War the Japanese army committed various war crimes involving China and Korea—including the use of biological and chemical weapons, and the drafting of Comfort Women from Korea, China and other countries for Japanese soldiers; and the displacement of civilian Chinese and

157  A History to Open the Future, above n 68. For a Korean perspective on the legality of the 1905 and 1910 Agreements formalising the annexation of Korea see Yi Taejin, ‘Forced Treaties and Japan’s Annexation of the Great Korean Empire: An Argument for the Illegality of the Annexation,’ in ­International Legal Issues in Korea-Japan Relations (Northeast Asian History Foundation: 2008) https://www.nahf. or.kr/?bmode=view&search=Y&s_word=law&mode=all&board=&menulev=&didx=&bname=& sidx=240&page=2&bidx=121&stype=2. For a Japanese stand-point see for example Yutaka Kawasaki, ‘Was the 1910 Annexation Treaty Between Korea and Japan Concluded Legally?’ (1996) 3(2) Murdoch ­University Electronic Journal of Law http://www.austlii.edu.au/au/journals/MurUEJL/1996/15.html. 158 See for example Paik Choonghyn, ‘Japanese Annexation of Korea from International Law ­Perspectives: Legal analysis of debates on the Case of Involuntary Annexation of Korea in 1910’ in International Legal Issues in Korea-Japan Relations (Northeast Asian History Foundation, 2008) https:// www.nahf.or.kr/?bmode=view&search=Y&s_word=law&mode=all&board=&menulev=&didx=& bname=&sidx=240&page=2&bidx=121&stype=2. 159  See Yanagihara, above n 62, 332. 160  See Report of the Commission of Enquiry (known as the Lytton Report) (1932) commissioned by the League of Nations, https://dl.wdl.org/11601/service/11601.pdf.

Antecedents of International Law in NEA 59

­ oreans to Japan and territories in the former Soviet Union.161 In 1944, the US K also ­indiscriminately bombed parts of Japan, and dropped Atomic bombs in ­Hiroshima and Nagasaki in August 1945, with a total of approximately 380,000 civilian deaths.162 Japan surrendered in August–September 1945 unconditionally, accepting the Potsdam Declaration. Korea was liberated in 1945, although the Republic of Korea was established in August 1948, whereas the Democratic People’s Republic of Korea (North Korea) was founded in 1948. The 38th Parallel is the dividing line between North and South Korea. It was originally the line that indicated the allocation of work as between the Soviet Union and the US, in the process of disarming the Japanese army.163 With the advent of the Cold War, this line became permanent. At the end of the Second World War, there was general consensus for the establishment of a single Korea, but due to disagreements over its implementation between the US and the Soviet Union, the UN called for the establishment of a government based on general elections. Fearing a loss in the elections to the more populous South, North Korea and the Soviet Union refused to participate and therefore elections were held only in South Korea. To deal with the Japanese War Crimes, at the behest of the US, and reflecting the Potsdam Declaration which set out the terms of Japanese surrender, the International Military Tribunal for the Far East (The Tokyo War Crimes Trial) was set up in 1946. A two-tier system was established with three categories of indictments viz class A, B and C war criminals. Class A war criminals were those involved in leading the commission of the crimes. The US decided not to try the Japanese Emperor as a War criminal. This was to facilitate a peaceful occupation of Japan, and to counter the spread of communism.164 28 war criminals were tried for crimes against peace—out of these, in 1948, seven were sentenced to death, and 18 to life imprisonment. However, the 18 were released subsequently, one of whom afterwards became a Prime Minister of Japan.165 The trial of 5700 Class B and C Japanese war criminals took place between 1945 and 1951 in 49 different courts. Out of these 984 were sentenced to death. In Korea, there was relative inaction against Korean Japanese sympathisers (chinilpa) in the early years post-Second World War, as the US Occupation of Korea involved using the existing enforcement apparatus already in place.166 In 2004, however, the Special Law on the Inspection of Collaboration with Japanese Imperialism was enacted. On the other hand, in contrast in China several thousands of Chinese Japanese sympathisers (hànjiān) were tried.167 This does beg the

161 

A History to Open the Future, above n 68.

162 ibid. 163 ibid. 164 ibid. 165 ibid. 166 ibid. 167 ibid.

60  International Law in the Historical Setting

question, given arguably the lack of vigour with which Korean Japanese sympathisers have been pursued in Korea, whether the exacting claim for justice from Japan with respect to war time atrocities is thereby undermined? Certainly, the claim is not estopped—after all an injury is an injury is an injury. The San Francisco Peace Conference was held in 1951 in order to formally establish the end of the war, and to iron out post-war issues, such as arrangements for reparations and the normalisation of relations with Japan. The conference involved some 52 countries including Japan, but did not include to their regret China and the two Koreas. The conference resulted in the San Francisco Peace Treaty 1951. At the same time, the US signed the US-Japan Security Treaty. The two Koreas were excluded, as they were former colonies of Japan, and therefore could not be considered as being part of the allied countries fighting against Japan,168 although the two Koreas were at the receiving end of Japanese aggression. And arguably there is a question touching on the State responsibility of victors in such circumstances— viz, were the Allied powers not in loco parenthesis of the two Koreas in respect to the ‘rights’ of the two Koreas, in so far as claiming and enforcing reparations from Japan with respect to injuries suffered by the two Koreas during the war, in a timely fashion? Be that as it may, the San Francisco arrangements together confirmed the position of Japan within the political West. In the San Francisco Peace Treaty, the Allied Powers waived their right to reparations from Japan;169 and Japan renounced territorial claims in China, including that of Taiwan; and recognised Korea as an independent State. The right of reparation of former ­‘colonies’ of Japan was left for negotiations as between Japan and the former ­‘colonies’. Korea and China had to negotiate bilaterally with Japan with respect to reparations. China waived its right of reparation in 1972, when it signed with Japan the Sino-Japanese Joint Communiqué 1972. South Korea normalised relations with Japan in 1965, formalising this in two agreements signed simultaneously viz the Treaty on Basic Relations between Japan and the Republic of Korea 1965, and the Agreement Between Japan and the Republic of Korea Concerning the Settlement of Problems in Regard to Property and Claims and Economic Cooperation 1965. The former agreement does not contain any apology for past injustices during the colonial rule of Korea.170 The latter agreement contains provision for reparation of some $500 million which is followed by Article II as follows: 1 The High Contracting Parties confirm that the problems concerning property, rights, and interests of the two High Contracting Parties and their peoples (including juridical persons) and the claims between the High Contracting Parties and between their peoples, including those stipulated in Article IV(a) of the Peace Treaty with Japan signed at the city of San Francisco on September 8, 1951, have been settled completely and finally.

The scope of this provision has been the subject of some disputed interpretation. 168 ibid. 169  170 

See Art 14 of the San Francisco Peace Treaty. A History to Open the Future, above n 68.

Conclusion 61

IV. Conclusion In sum, the impetus and agenda for post-war justice in NEA was hijacked by the US over its battle against communism and its resurrection of Japan as an axis against communism. This has been compounded by the manner in which within Korea post-war justice has been pursued. The lack of finality in the pursuit of legal and rectificatory justice leaves open the interplay of temporal and other obstacles to the pursuit of full accountability in the region. International Law in the historical setting of NEA cannot be reduced in a nutshell nor relegated to a historical chapter as such. There are here questions that still need unpacking. Can there be a forum for the re-consideration and resolution of historical disputes? This would involve consensus on a number of questions viz consensus on a list of the disputes; on addressing the disputes; on the legal and non-legal principles involved in the resolution of the disputes; on the architecture of the forum; and the nature of the outcomes. Such a consensus is going to be very difficult to achieve even assuming one forum alone could be constructed to deal with all historical disputes amongst the nations in the NEA. In the absence of a consensus on the use of a forum for the resolution of historical disputes,171 efforts at creating the right environment for a constructive dialogue and the establishment of a knowledge forum that focuses on clarifying the issues that underpin the historical disputes in an objective manner would be much more relevant and constructive. Truth itself is indeed a powerful tool for the resolution of historical disputes!

171  See the Agreement Between Japan and the Republic of Korea Concerning the Settlement of Problems in Regard to Property and Claims and Economic Cooperation 1965 wherein the Agreement provides for an arbitration procedure. See Korean Constitutional Court decision on the Constitutionality of Nonfeasance under Article 13 of the Agreement between the Republic of Korea and Japan Concerning the Settlement of Problems in Regard to Property and Claims and Economic Cooperation (2006 Heonma 788 Decision, Issued August 30 2011).

3 Regional Peace and Harmonisation through the Rule of International Law in the Domestic Legal Systems in North East Asia I. Introduction The relationship between the domestic legal system and International Law in North East Asia (NEA) has mainly two facets. First, the approach as set out in the domestic legal system to International Law; and second, the consequences comparatively within the region—of the differing degrees of integration between the respective legal systems of China, Korea and Japan and International Law. These differences arise from the ‘laissez-faire approach’ to the inter-face between the two legal systems under International Law. International Law leaves it to States as to how International Law is received within a State and interacts with domestic law. It is also at some level non-prescriptive as to how States arrange the involvement of their population in foreign affairs (and therefore in the development of International Law). Both of these considerations are about contextualising International Law in the domestic legal system and empowering the population in the development of International Law, thereby informing the development of International Law in the domestic image. In this manner the ‘rule of International Law’ is reinforced. A State that insulates itself from International Law may well be reinforcing its sovereignty but equally this is at the expense of the opportunity to contextualise International Law in its ethos and the maximisation of the advantages of the rule of International Law. Generally, how this relationship is ordered will also inform the extent of harmonisation of laws in the differing legal systems. At one end of a spectrum of the different degrees of relationships between International and domestic law there is the space wherein the two are strictly segregated, whereas at the opposite end domestic law and International Law are completely enmeshed. In between there are also different shades of relationships that can be discerned in State practice. Moreover, a State may engage in diverse ways with this relationship depending on the kind of issue involved. A State’s choice within this spectrum as articulated in its Constitution informs both how I­nternational

Theory 63

Law is contextualised within the domestic setting, as well as its calculation of its international and regional responsibilities. Generally, in State practice there would seem however not much of a focussed and comprehensive policy approach to this relationship. Written constitutions may touch upon the relationship but these can be aspirational and subject to constitutional/judicial practice in the manner of their interpretation and elaboration. And whereas various individual studies of diverse State practice can be found it is the case that the International Law Commission (ILC) has not thus far touched upon the subject as a discreet area for its focus.1 The advantages and disadvantages of differing degrees of integration have been rehearsed in academic discourse taking into account such diverse considerations as human rights, democracy, constitutional principles such as separation of p ­ owers in foreign policy-making, good governance generally and State sovereignty.2 There has not been much focus from the stand-point of economic analysis,3 even if references have been made in the discourse to a State’s capacity to engage in an efficient breach where the State has not given direct effect to International Law.4 This relationship between International Law and domestic law focuses on the national constitutional framework setting out the respective parliamentary and executive’s roles in treaty-making/unmaking; the manner of the implementation of International Law in the domestic system, including the direct applicability/ status of International Law in the domestic legal system. This will be the focus of this chapter with reference to China, Korea and Japan.

II. Theory From a contextual and regional perspective, the following questions may be highlighted. First, from a domestic perspective: would greater and more transparent participation in foreign policy/treaty-making involving parliamentary and/or direct public participation result in a greater contextualisation of the resulting developments in International Law with the domestic normative and political framework? Certainly, such a development would lead to the International Law developments being better imbued with domestic perspectives. Indeed, some historical human rights concerns closer to the emotions of the general public and 1 The subjects focussed upon in the ILC are the subject of consensus within the Commission amongst its members who come from diverse countries with respective interests. 2  See for example Asif H Qureshi and Andreas R Ziegler, International Economic Law (London, Sweet & Maxwell, 2011) 119–29. 3  See Tom Ginsburg, ‘The Interaction between Domestic and International Law’ in E Kontorovich and F Parisi (eds), Economic Analysis of International Law (Cheltenham, Edward Elgar, 2016). 4  See for example John Jackson, ‘National Constitutions, Transnational Economic Policy and International Economic Law: Some Summary Reflections’ in Meinhard Hilf and Ernst-Ulrich Petersmann (eds), National Constitutions and International Economic Law (Alphen aan den Rijn, Kluwer, 1993).

64  International Law in Domestic Legal Systems

particularly affected sections of society may best be served in the long run through more consensual decision-making. Would direct applicability of International Law enable the public to put their individual imprint on the course of its development? Certainly, direct applicability enables better enforcement of international agreements with reference to domestic circumstances, and informs the development of domestic legislation in accordance with international norms. ­Moreover, it can also enable a government to insulate its normative legacy from being undermined through a change of government.5 Is there a greater need to constrain the executive in authoritarian States by empowering the public as a safeguard against the executive;6 and return the sovereignty of the State from rent seekers to the p ­ ublic at large, who ultimately are the true owners of State’s sovereignty?7 ­Certainly there is a measure of consensus that direct applicability of International Law in the domestic system could contribute to such a need. Would a cost-benefit analysis of the precise level of integration of International Law necessarily lead the State in engaging in an efficient breach?8 Or are the full range of long-term costs and benefits to the nation and the world at large such that a greater integration of International Law is called for, including the empowerment that comes from the ability to complete the incomplete agreement negotiated at the international level, through for example direct applicability? Or does economic analysis lead to different conclusions depending on the subject matter and country? Thus, Tom Ginsburg asserts that International Law and domestic law ‘have different features that might make them more or less desirable in particular contexts, for particular countries.’9 However, where a State’s economic self-interest is set, is not the same query as whether a deeper integration of the two legal systems results in a better contextualisation of International Law within the domestic legal system. Second, from a regional perspective: would deeper integration result in a better implementation of regionally relevant international norms? Would deeper integration result in reducing tension as between the three States at the level of interState relations, by facilitating individual inter-state redress, in particular human rights related, through domestic judicial process? Certainly, there is also a role here, for the facilitation of redress for historical injustices that are set in the specific history of the region. The availability of domestic redress for intra-regional issues deflects from State to State confrontational politics, and paves the way for more 5 

Ginsburg, above n 3. for example Eyal Benvenisti, ‘Judicial Misgivings Regarding the Application of International Law: An Analysis of Attitudes of National Courts’ (1993) 4 EJIL 159–83, 159. 7  See for example K Raustiala, ‘Rethinking the Sovereignty Debate in International Economic Law’ (2003) 6(4) Journal of International Economic Law 841–78. In the UK in R (Miller) v Secretary of State for Exiting the European Union (2017) UKSC 5(19) the UK Supreme Court ruled that the UK executive could not initiate the UK withdrawal from the EU without an Act of the UK Parliament authorising such a withdrawal. 8  See for example J Jackson and A Sykes, Implementing the Uruguay Round (Oxford, OUP, 1997) 462; and Ginsburg, above n 3. 9  Ginsburg, above n 3. However, economic analysis needs to build upon a clear methodology that will predict the optimum relationship within a given set of parameters. 6  See

Theory 65

­ onourable resolutions under the rule of International Law. The conflicts that h can arise as a result of a dualist approach to the two systems of law that are then resolved through State responsibility at the international plane can be avoided through a better integration of the two systems. Does deeper integration lead to better flows of trade in goods, services, investment and labour? Mutual assurances generated through deeper integration of better implementation of international economic norms can only facilitate confidence in trade and investment. Does deeper integration facilitate greater individual participation in the development of regional norms? Certainly, a more consensus-based treaty-making apparatus involving all relevant stakeholders would not lead to subsequent re-negotiations over the same issues. Would it facilitate a more optimal harmonisation of laws at the regional level? A closer integration of the two systems is conducive to the better harmonisation of national laws of the States in NEA originating in international conventions, since the rights and burdens set in the international norms will be uniform in all the States in practice, and lead to better efficacy of regional co-operation and economic integration agreements. Generally, the practice internationally10 (including in NEA), at any rate in the recent past, has been that domestic courts have shown reluctance to rein in the executive through the strictures of International Law. This has been done, for example, through restrictive interpretations of International Law references in domestic Constitutions; in deferring to the executive on questions of International Law, including their interpretations of it; through the use of various doctrines, such as sovereign immunity and Act of State, in order to avoid pronouncing on questions of International Law; and in the manner of defining what is or is not a self-executing international agreement.11 If however International Law is to be contextualised in the domestic legal system, the apparatus of domestic implementation of International Law has to be constructed such that it allows for a proper engagement of International Law at the domestic level. In theory, the status of International Law in the domestic system is understood to revolve mainly around whether a State takes a monist or a dualist approach to its relationship with International Law—ie, whether International Law and domestic law are treated as part of one system, or whether they are treated as being two different legal systems.12 The monist approach originates in the natural law school wherein a fundamental principle underpins both the international and domestic system as for example pacta sunt servanda.13 On the other hand, the dualist approach is set firmly in positivism, emphasising consent of the State.14 However, this monist/dualist narrative is set in western philosophical engagements on the

10 

See for example Benvenisti, above n 6.

11 ibid.

12  See for example J Crawford, Brownlie’s Principles of Public International Law 8th edn (Oxford, OUP, 2012) ch 3. 13  See M Shaw, International Law 6th edn (Cambridge, CUP, 2008) 29. 14 ibid.

66  International Law in Domestic Legal Systems

subject,15 with little reference to other civilisational perspectives of the international society and the domestic legal system. Thus, in the Islamic tradition historically, the world was divided between the Islamic world and the non-Islamic world. And in the historical traditions of NEA, the world was divided between the Chinese Tributary System and the outside barbarian world. Both these systems had a unitary construct of the legal system within which they habited. Moreover, in Confucianism, a philosophy that underpins the cultural traditions in NEA, this discourse is affected also by the very manner in which law and the moral plane are ordered—with law as a normative framework being very much a last resort for the resolution of disputes. This ‘first moral’ approach at some level cuts across conceptions of divisions in legal systems. Finally, the received wisdom in the field is set against the background of the unit of the State and International Law, with no reference to the regional dimension viz what should the domestic approach be to the regional normative framework; or for that matter regional practice with reference to this relationship. Furthermore, the assumption that the relationship between domestic and International Law is a matter for domestic law, detracts from an enquiry whether as a matter of international policy this fundamental tenet of International Law should now be set aside. At a policy level this relationship is informed by such considerations as the level of involvement non-State actors should have over national foreign policymaking; the level of discretion the executive should have over the State’s foreign policy-making; the constitutional safeguards that should be instilled in the foreign policy and practice of a State; and the manner in which the efficacy of International Law is best optimised, in particular so as to protect internationally guaranteed fundamental human rights. Thus, whilst the manner in which this interface between domestic law and International Law is managed has been historically left to domestic systems under International Law, the policy considerations relevant to the ordering of this relationship have been the subject of changing values with respect to foreign relations, including its formulation and implementation. In particular, the increasing focus of International Law in the domestic sphere (including the long-term impact of certain International Law norms transformed into domestic law thereby engendering certain entrenched expectations amongst ­citizens); and the greater accountability and reining in of executive powers in foreign policy-making to parliamentary authority, have all begun to challenge in some measure the clarity and simplicity of the traditional ordering of the international and domestic systems within national systems.16 From a legal perspective, such challenges have implicated both constitutional law and International Law.

15 

See for example Crawford, above n 12, ch 3. for example the Supreme Court Decision in the UK over the UK government’s decision to withdraw from the EU without a further statutory authority to do so in 2016. See also Korean ­Constitutional Court Decision on Comfort Women for the Japanese Military (006 Heonma 788 ­Decision (Gyeoljeong) August 30, 2011). 16  See

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In sum, the contextual setting of the relationship between International Law and domestic law in NEA may be described as follows. First, it is in part set against the general backdrop in the development of competing policy considerations in this sphere—focusing around State and individual rights respectively. Second, it is informed by the historical/political antecedents of the respective Constitutions of the NEA States. Thus, the current 1987 Korean Constitution is influenced by German (Grund Recht) and US constitutional practices; whereas the 1948 Constitution was affected by the German (Weimar Republic) Constitution, as well as Japanese and US17 Constitutions. The Japanese Constitution was imposed on Japan by the US post-Second World War.18 And the Chinese Constitution has its origins in the Chinese communist movement with its latest version emphasising the socialist character of the State. In the circumstances, it is to be noted that both the US and German Constitutions take a monist perspective to treaties;19 and Customary International Law.20 This is reflected in the Japanese and Korean Constitutions in some measure. In conclusion, the management of the relationship between International Law and domestic law is not only of concern within a domestic system but also raises prospects of better intra-regional co-ordination and enforcement of relevant International Law.

III. Practice A. China21 The framework for the relationship between International Law and domestic law in China, in particular with respect to international agreements and their reception in the domestic legal system, is informed by a number of policy and historical considerations. First, there is an emphasis on Chinese sovereignty—specifically so articulated in its Constitution as follows: China consistently carries out an independent foreign policy and adheres to the five principles of mutual respect for sovereignty and territorial integrity, mutual non-aggression,

17 

See for example Paul S Dull, ‘South Korean Constitution’ (1948) 17(7) Far Eastern Survey 205–07. See for example Robert E Ward, ‘The Origins of the Present Japanese Constitution’ (1956) 50(4) The American Political Science Review 980–1010. 19  See Art VI of US Constitution and 59(2) of the German Basic Law. 20  Art 25 of the German Basic Law and US-Restatement Third para 111, comment (d). 21  Xue Hanqin and Jin Qian, ‘International Treaties in the Chinese Domestic Legal System’ (2009) 8(2) Chinese Journal of International Law 299–322; Xue Hanqin, Hu Zhiqiang and Fan Kun, ‘National Treaty Law and Practice: China’ in Duncan B Hollis et al (eds), National Treaty Law & Practice (­Leiden, Martinus Nijhoff, 2005) Ch 5; Jie Jeanne Huang. ‘Direct Application of International Commercial Law in Chinese Courts: Intellectual Property, Trade, and International Transportation’ (2008) 5(3) ­Manchester Journal of International Economic Law 42–105; C Cai, ‘International Law in Chinese Courts During the Rise of China’ (2016) 110(2) AJIL 269–88. 18 

68  International Law in Domestic Legal Systems non-interference in each other’s internal affairs, equality and mutual benefit, and peaceful coexistence in developing diplomatic relations and economic and cultural exchanges with other countries.22

Second, this emphasis on State sovereignty is set against the backdrop of the response of the People’s Republic of China to the historical unequal treaties inflicted upon China post the First Opium War between 1839–42.23 Thus, ­Article 55 of the 1949 Common Guidelines of the Chinese Consultative Conference in relation to past agreements entered into by China states: For the treaties and agreements concluded by the Kuomintang government with foreign governments, the Central People’s Government of the People’s Republic of China should examine them, according to their contents, to recognize, abolish, revise, or re-conclude them respectively.24

Third, the former Soviet Union’s perspectives on International Law, in particular the analysis that International Law was essentially western, led to an absence of its mention in its Constitution. This legacy of the Soviet era is considered to have informed the drafting of the Chinese Constitution.25 Finally, the need to insulate the authority of the executive from being undermined by International Law, as much as reserving flexibility for the government to push through national policy objectives, have been considerations that are currently shaping China’s relationship with the international legal system.26 Against this background, the Chinese approach to International Law is a dualist one although not articulated expressly as such in its Constitution. The Chinese ­Constitution is silent on the status of International Law (viz Customary International Law and treaties) in its domestic legal system.27 Treaties do not have legal effect in the domestic legal system unless they have been transformed through domestic legislation to have such an effect. Chinese practice is to specifically transform an international agreement in relevant pieces of legislation to give effect to them; and/or to prioritise them over specific domestic legislation.28 The scope of such transformation can focus on an area of law or partake of a specific Statute. Thus, the WTO Agreements do not prevail generally over any conflicting domestic legislation unless explicitly so stated. Moreover, the WTO Agreements cannot be invoked in a dispute involving the executive.29 Customary International Law as

22 

Preamble to the Fourth Constitution of the People’s Republic of China. Cai, above n 21, 269. 24  See Hanqin, Zhiqiang and Kun, above n 21, Ch 5, 155. 25  Cai, above n 21, 269 wherein the author refers to the Regulations on Issues Concerning the Trial of Administrative Cases Relating to International Trade (2002 Supreme People’s Court). 26  Cai, above n 21, 269. 27  Hanqin and Qian, above n 21, 302. 28  ibid, 303–04. 29  Cai, above n 21, 269. 23 

Practice 69

such does not seem to be part of domestic law unless it has been specifically transformed through legislation. It is unlikely to do so where it potentially constrains executive discretion.30 Where an international agreement can be directly invoked as a consequence of specific domestic legislation, and there is the need to interpret the international agreement, the Supreme People’s Court can issue interpretations of the international agreement to lower courts.31 Moreover, the Supreme Court can issue joint interpretations with a relevant competent body such as the foreign office.32 The interpretation of treaty provisions in courts is normally done in the same way as the interpretation of domestic law.33 However, in the interpretation of domestic legislation courts have applied the principle of consistent interpretation with international obligations.34 The domestic arrangements for entering, ratifying and implementing international agreements in China are set out in the Law of the People’s Republic of China on the Procedure of the Conclusion of Treaties 1990 (Procedures Law).35 This is a fairly detailed piece of legislation describing the framework for international agreements within China. Briefly, the following may be noted. First, the Procedures Law defines a treaty inter alia in terms of its compliance with ‘fundamental principles of international law and the free will of the parties.’36 Second, a distinction is made between treaties entered by the State, by the government and by governmental departments. Internal procedures for the ratification and implementation of these differ according to the type of treaty involved.37 For example Memorandum of Understandings (MOUs) as between government departments are implemented through administrative measures,38 even though they may call for legislative engagement. Third, treaties are concluded by the State Council.39 Authority to ratify and abrogate international agreements however rests with the Standing Committee of the NPC (National People’s Congress), and upon its advice with the President. Fourth, certain treaties require prior approval of the Standing Committee of the NPC before final ratification by China.40 Finally,

30 

See generally ibid. Hanqin and Qian, above n 21,314. 32 ibid. 33  ibid, 317. 34  See for example Cai, above n 21, 269. 35  See for example, Hanqin and Qian, above n 21, 300. 36  Art 2 of the Procedures Law. 37  Art 4 of the Procedures Law. 38  Hanqin and Qian, above n 21, 306. 39  Art 3 of the Treaty Procedure Law. 40  See Art 7 of the Treaty Procedure Law: ‘(1) treaties of friendship and cooperation, treaties of peace and similar treaties of a political nature; (2) treaties and agreements relating to territory and delimitation of boundary lines; (3) treaties and agreements relating to judicial assistance and extradition; (4) treaties and agreements which contain stipulations inconsistent with the laws of the People’s 31 

70  International Law in Domestic Legal Systems

international agreements which concern important spheres of national sovereignty, such as ­taxation and criminal offences, have to be implemented in accordance with the laws and procedures of the NPC and the Standing Committee of the NPC.41 The Chinese International Law framework needs to be evaluated in terms, for example, of democratic participation in treaty making/unmaking/implementation; parliamentary oversight; transparency; separation of powers; human rights; effective implementation of International Law. From a regional perspective, the ordering of the International and domestic legal relationship needs to take into account the relations as between residents of China and Korea and Japan, as well as relations inter-se between the three States. If there is an asymmetry as between these three States in the manner in which International Law is integrated in the domestic system does this add a cost to China, or for that matter does China add to costs, within the NEA matrix? The reality is that the Chinese system of embracing International Law within its domestic system, at any rate in the form of international agreements, is selective and controlled. Thus, fundamental norms set in international agreements cannot be effectively implemented through its case by case implementation in specific pieces of legislation. Such norms may concern any domestic prescription within their scope and not just those specifically identified as such. Thus, it has been acknowledged ‘there is no principle in the existing Chinese Constitution or national laws that gives priority to treaties over domestic laws on a general basis.’42 Moreover, a system that can allow for executive interpretations to be inculcated in the judicial process can result in the dangerous merging of the executive and judicial arms of the Constitution, thus potentially compromising judicial independence. In the same vein, there are aspects of the Procedures Law that are not clear. For example, when is a ‘treaty’ for the purposes of the Procedures Law, conflicting with ‘fundamental principles of international law and the free will of the parties’? How are agreements pegged into State to State, government to government and Ministry to Ministry agreements? In sum, the Chinese Constitution has well insulated International Law from the domestic legal system; and whereas such an approach may well allow for executive/governmental flexibility in policy matters, the manner in which it undermines the efficacy of International Law including regional integration in domestic implementation needs further reflection—as does the locus of decision-making and scrutiny of International Law making within China.

Republic of China; (5) treaties and agreements which are subject to ratification as agreed by the contracting parties; and (6) other treaties and agreements subject to ratification.’ See also Hanqin and Qian, above n 21, 302. 41  42 

See Art 8 of the Legislation Law and Hanqin and Qian, above n 21, 302. See Hanqin, Zhiqiang and Kun, above n 21, 164.

Practice 71

B. Korea43 The Korean approach to International Law is essentially monist with an important parliamentary input in treaty-making. The principal governing provisions in the Korean constitution are as follows: Article 6: (1) Treaties duly concluded and promulgated under the Constitution and the generally recognized rules of international law shall have the same effect as the domestic laws of the Republic of Korea. (2) The status of aliens shall be guaranteed as prescribed by international law and treaties. Article 60 (1) The National Assembly shall have the right to consent to the conclusion and ratification of treaties pertaining to mutual assistance or mutual security; treaties concerning important international organizations; treaties of friendship, trade and navigation; treaties pertaining to any restriction in sovereignty; peace treaties; treaties which will burden the State or people with an important financial obligation; or treaties related to legislative matters. (2) The National Assembly shall also have the right to consent to the declaration of war, the dispatch of armed forces to foreign states, or the stationing of alien forces in the territory of the Republic of Korea.

Generally, International Law under the Korean Constitution has the same effect as domestic law. The ‘generally recognised rules of international law’ are understood to include treaties and General International Law.44 However, the International Law in question has to be self-executing;45 although as in most jurisdictions this concept is not self-evidently clear. Moreover, the treaties must be ‘treaties’ under International Law;46 and if the treaty in question had provision for a reservation then Korean legislation can deviate from treaty.47 In the same vein, aliens are directly protected under the rules set in ‘International Law and treaties’— presumably also under rules that are self-executing. Moreover, treaties have the

43  Chin-Sok Chung, ‘Legislative Consent to the Conclusion and Ratification of Treaties: Korean ­ erspectives’ in Choong-Hyun Paik (eds), International Law in Korean Perspective (Seoul, Seoul P National University Press, 2004) 51–67; S Lee and HE Lee, The Making of International Law in Korea: From Colony to Asian Power (Leiden, Brill/Nijhoff, 2016) –3-6 and 23–30 (Note this book contains no footnotes/references to sources relied upon.). 44  See S Lee and HE Lee, above n 43. 45 See Lee and Lee, ibid. The Marrakech Agreement has been considered to have direct effect (see Korean Constitutional Court: HunBa 65) https://www.electronicpublications.org/catalogue. php?id=221. 46  See Korean Constitutional Court:2010 HunMa111 https://www.electronicpublications.org/­ catalogue.php?id=221. 47  See Korean Constitutional Court 89 Hun Ga106 (1991); and HunBa 51 (2007). https://www. electronicpublications.org/catalogue.php?id=221.

72  International Law in Domestic Legal Systems

same effect as domestic law only if they are ‘duly concluded and promulgated’ under the Korean Constitution. This seems to be both a procedural and substantive qualification. This qualification does not however apply to ‘generally recognized rules of international law’ nor it seems to ‘international law and treaties’ that govern the status of aliens. Finally, the relationship between domestic law and International Law in the event of conflict is to be determined by such principles of lex posterior derogate legi priori and lex specialis derogate legi generali.48 In the circumstances, domestic legislation has been challenged on grounds of incompatibility with International Law.49 With respect to the status of aliens however ‘international law and treaties’ seem to be over-riding if they are self-executing.

i.  Direct Applicability of WTO Agreements50 The direct applicability of WTO law in Korea has been the subject of some discourse and judicial deliberations. The insights they provide into the relationship of domestic law with International Law also have a general relevance. As has been pointed out under Article 6 paragraph 1 of the Constitution of the Republic of Korea, International Law (treaties ratified by Korea including General International Law) has the same effect as domestic ‘law’. According to Korean scholars, International Law consistent with the Korean Constitution51 does not need any further domestic legislative process (except for a procedural step of the ­promulgation)52 to have direct effect in the Korean domestic legal system.53

48 

See Lee and Lee, above n 43. See for example Korean Constitutional Court 2007 Hun Ga 12; 2010 Hun Ma 606; and Korean Supreme Court 85 HU 13; 90 Do 1451 (10). 50 The following account about direct applicability of the WTO agreements derives from Asif H Qureshi and Nany Hur, ‘Korea’s Responses in WTO “Disputes” and “reviews”: A Perspective of Non-State Actors’ (2013) 3(1) KLRI Journal of Law and Legislation 105–59. 51  Treaties which become the ‘law’ of Korea cannot overcome the superiority of the Constitution in accordance with the legal hierarchy. See The Constitutional Court Decision, 99HeonGa13, (2001) (in Korean). 52  Act on the Promulgation of Acts and Subordinate Statutes, Art 11 para 1: ‘In cases where amendments to the Constitution of the Republic of Korea, Acts, treaties, presidential Decrees, Ordinances of the Prime Minister, and Ordinances of Ministries are promulgated, and proposed amendments to the Constitution of the Republic of Korea, budgets, and contracts incurring financial obligation on the State outside the budgets are publicly notified, they shall be published in the Official Gazette.’ Especially about treaties, Art 6 says ‘In cases of treaties, the fact the treaties have obtained the consent of the National Assembly or have undergone the deliberation of the State Council shall be mentioned in the preambles of promulgations of those treaties, on which the President shall affix his/her seal after signing his/her name and write the date of promulgation and which the Prime Minister and the competent members of the State Council shall countersign’ (This Article wholly amended by Act No 10059, 12 Mar 2010). An English version of the provisions are available at http://elaw.klri.re.kr/kor_service/ lawTotalSearch.do. 53  Kyung Soo Jung, ‘Korean Legal System and Experience on Domestic Application of International Law’ (2008) II(28) Korea International Law Review 98 (in Korean). See also on monism, Anthony Aust, Modern Treaty Law and Practice (Cambridge, CUP, 2000) 146; and Thomas Buergenthal, ‘Self-Executing and Non-Self-Executing Treaties in National and International Law’ (1992) Recueil des Cours de I’Académie de Droit International 316. 49 

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Since Korea has adopted and promulgated the covered agreements of the WTO as a package in 1994, these international agreements are enforceable domestically.54 The direct effect of the WTO agreements and their invocation in domestic courts by non-state actors has been considered in several decisions of the Supreme Court of Korea,55 as well as in the Constitutional Court of Korea.56 Thus, in the Constitutional Court case of A Constitutional Appeal on the Act on the Aggravated punishment, ETC of Specific Crimes,57 Mr Kim submitted a petition challenging the imposition of an aggravated punishment alleging that it was based on a ‘treaty’ that violated the Constitution. Mr Kim’s importation of Chinese sesame without approval58 from the Minister violated Article 10-3 of the Act on Distribution and Price Stabilization of Agricultural and Fishery Products.59 Article 10-3 sets out the prerequisites for importation in order to keep the Market Access Volume at less than five per cent of the total domestic consumption.60 Mr Kim’s smuggling was considered as hindering the Korean government’s restriction for Market Access Volume that was intended to reflect commitments under the Marrakesh Agreement. This violation aggravated the punishment on his smuggling. The petitioner argued that only a ‘treaty’ cannot be the reason for the aggravated penalty61 since there is no specific wording that states a ‘treaty’ can be the cause of the aggravated penalty in the Customs Act or ‘the Act on the Aggravated Punishment, etc of Specific Crimes’. According to the petitioner, further amendment of this Act is necessary to make this ‘aggravation’ possible. Also, he insisted that this was an infringement of his fundamental rights and the principle of ‘nulla poena sine lege’ since the aggravation was not based on the ‘law’ as stated in the Constitution,

54  WTO, Trade Policy Review Republic of Korea: Report by the Secretariat, WT/TPR/S/268/Rev.1, 8 November 2012 at 22. The Special Act on the Implementation of the Agreement Establishing the World Trade Organization of 1 January 1995, gazetted on 31 December 1994, was last revised on 14 December 2007 to simplify its original text. 55 See Supreme Court Decision, 91nu10763 (1992) (in Korean); Supreme Court Decision, 2004Chu10, (2005); Supreme Court Decision, 2004Chu72, (2008) (in Korean); Supreme Court Decision, 2008Du17936, (2009) (in Korean). 56  Constitutional decision 97 Hun-BA 65 (November 26, 1998). 57 ibid. 58  This can be seen as a sort of permission since it needs a process to request for a recommendation first and be accepted. 59  Currently, Art 15 (Recommendation of Agricultural Products Imports) (1) Any person who intends to import agricultural products which are not prescribed otherwise by other Acts from among the agricultural products which are imported at the concessionary tax rates that apply to the market access volume as shown on the Schedules of Concessions of the Republic of Korea following the ­Marrakesh Agreement Establishing the World Trade Organization (WTO) shall get the recommendation from the Minister for Food, Agriculture, Forestry and Fisheries. (Amended by Act No 8852, Feb. 29, 2008). English version available at http://elaw.klri.re.kr/kor_service/lawTotalSearch.do. 60  Korea had made market access concessions such as this under the Agreement on Agriculture. See the Agreement on Agriculture Art 4. 61  Under the Marrakesh Agreement, this is just a concession by Korea and the ‘penalty’ for Korea violating its concession would be the countermeasures by other Member States. But here in this case, ‘penalty’ is on Mr Kim’s smuggling due to the violation of Korea’s domestic law which gives effect to the Marrakesh Agreement.

74  International Law in Domestic Legal Systems

which should be a ‘domestic legislation’ according to the petitioner.62 However, the Court pointed out Article 12:163 and 13:164 of the Constitution, especially Article 6 in relation to the direct effect, saying that a treaty has the same effect as a domestic Act. The Court said ‘since the Marrakesh Agreement is also a lawful treaty having the same effect as a domestic Act, the aggravated punishment based on the Marrakesh Agreement should be treated equally as if it were based on a purely domestic legislation.’65 Thus, the Court had ruled in this case that the aggravated punishment based on the Marrakesh Agreement was not ‘a criminal punishment without any reason under the law’ and did not infringe any fundamental rights of Mr Kim. In sum, the Court recognised the direct effect of the WTO agreements in considering the challenge by the petitioner of the criminal punishment imposed on him. Similarly, in the Ordinances for School Food Service in the Province of Jeollabukdo case, decided by the Korean Supreme Court,66 a Superintendent of Education in Jeollabukdo brought a suit against the Provincial Assembly with respect to one of its ordinances. The ordinance at issue provided as follows: the use of quality agricultural/marine/livestock products and processed food produced in that region (‘quality agricultural products’) shall be preferred in the school food service of the elementary/middle/high schools by a specific local government; part of the food or the subsidy for its purchase money is offered selectively to consumers of quality agricultural products; recipient schools of monetary grants must use them for the purchase of quality agricultural products.67

The plaintiff, the Superintendent of Education, claimed that this local government ordinance was invalid, due to its violation of the national treatment standard set out in Article III of GATT 1994, since it explicitly encouraged preference for locally produced ingredients to imported ones.68 In its response, the d ­ efendant, the Provincial Assembly, tried to justify the violation of the national standard

62 

Constitutional decision 97 Hun-BA 65 (November 26, 1998). of the Republic of Korea, Art 12:1 ‘… No person shall be punished, placed under preventive restrictions or subject to involuntary labor except as provided by Act and through lawful procedures.’ English version available at http://elaw.klri.re.kr/kor_service/lawTotalSearch.do. 64  Constitution of the Republic of Korea, Art 13:1 ‘No citizen shall be prosecuted for an act which does not constitute a crime under the Act in force at the time it was committed, nor shall he be place in double jeopardy.’ English version available at http://elaw.klri.re.kr/kor_service/lawTotalSearch.do. 65  See Qureshi and Hur, above n 50, 119. 66  Supreme Court Decision, 2004Chu10, (2005) [Affirmation of Invalidity of Re-resolution of the Ordinances for School Food Service in the Province of Jeollabukdo], (In English). See also other cases similarly decided by the Supreme Court viz, The Cancellation of the Imposition of Tariff Supreme Court Decision, 91nu10763 (1992) (in Korean); The Confirmation on the Invalidity of Ordinances for School Food Service in the Province of Kyungsangnamdo, Supreme Court Decision, 2004Chu72, (2008) (in Korean). 67  Supreme Court Decision, 2004Chu10, (2005), English version of the decision by the Supreme Court of Korea is available at http://library.scourt.go.kr/download?sourceFilePathName=/app/sclib/ htdocs_sclib/up_file/case_eng/3-76 Supreme Court Decision 2004Chu10 Delivered on September 9.htm&destFileName=3-76 Supreme Court Decision 2004Chu10 Delivered on September 9.htm. 68  Supreme Court Decision, 2004Chu10, (2005). 63  Constitution

Practice 75

under the government procurement exception in Article III (8) (a) of GATT 1994. The Supreme Court ruled on whether the ordinance (a lower rule than the ‘law’ in the hierarchy of the Korean legal system) complied with WTO law.69 In this case involving a Wide-Area Local Government like Jeollabukdo, according to Articles 1, 2 and 3 of the Agreement on Government Procurement (AGP), and Korea’s Schedules of Concessions, a government procurement exception can only be recognised if the goods are valued at less than the procurement price of 200,000 SDR.70 ­Articles 4 (2), 6 (2) and 6 (3) of the enacted ordinance under challenge in this case did not place any restrictions on the price of the foods ‘which are purchased or for which subsidies are granted by a Wide-Area Local Government.’71 The Supreme Court therefore held that the ordinance violated ‘the principle of national treatment under Article 3 of the AGP even in the case of purchase for the governmental utilization.’72 In particular, the Court stated the treaties ‘were accorded legal validity equivalent to the domestic law under Article 6 (1) of the Constitution, and accordingly, the ordinances enacted by local governments are invalid if they violate the GATT or the Agreement on Government Procurement (AGP).’73 Moreover, the defendant had argued that the Supreme Court was not the appropriate forum because only the WTO dispute settlement body had the authority to rule on the issues related to WTO agreements, according to the Understanding on Rules and Procedures Governing the Settlement of Dispute (DSU) Article 23:1 and Article 23:2 (a) and (b).74 However, the Supreme Court rightly denied the displacement of its jurisdiction through the application of Article 23 of the DSU, on the basis that the DSU only applied with respect to disputes between members of the WTO and was not relevant with respect to issues as between the local government and the central government within a Member State.75 It will be noted that this case caused some public sensation.76 However, there are still negative views on the direct effect and invocability of WTO rules in the domestic Korean legal system. Thus, with respect to the Ordinances for School Food Service in the Province of Jeollabukdo case (and other later cases with the same factual background), some scholars consider these cases as exceptions. For example, Ju77 observes that given the fact that the WTO system

69 ibid. 70 ibid. 71 ibid. 72 ibid. 73 ibid. 74 ibid. 75 ibid.

76  Many newspaper articles dealt with this decision having debates on whether it is a ‘right’ decision regarding the sensitive agricultural sector in Korea. For example, See Young-jin Jung, ‘The WTO agreement and the Ordinances for School Food Service’ Gyung-hyang Shinmun (26 September 2005 (in Korean), and Hee-kyung Byun, ‘Regretful Decision of the Supreme Court on the Ordinances for School Food Service’ Seoul Shinmun (21 September 2005) (in Korean). 77  Jin-Yul Ju, ‘A Critical Review of the Domestic Effect of the WTO Agreement in Korea’ (2005) 12(2) Seoul International Law Journal 39–41 (in Korean).

76  International Law in Domestic Legal Systems

is underpinned by the reciprocity principle, Korea should not unilaterally afford direct effect while other Members, such as the US, EU and Japan require additional domestic legislative steps to implement International Law domestically, and thus bring to bear domestic considerations on the question of direct ­applicability.78 Moreover, Korea is not ‘obliged’ to allow the direct application of the WTO agreements in its domestic courts.79 In the same vein, Park80 observes that the plaintiff in this case was not a ‘private party’ but a person with the authority given by the government.81 And since the ruling itself does not deliberate on the private parties’ rights and obligations, the case cannot be seen as recognising the direct effect of WTO agreements in the Korean domestic legal system.82 Thus, it has been observed Korea is not different from other WTO members such as the US and EU.83 More recently in 2009 the question of direct applicability of WTO law appears to have taken a negative twist. In the Supreme Court decision of Cancellation of the Imposition of Anti-dumping Duties a Chinese company, Shanghai ASA Ceramic Co, brought a suit against the Minister of Strategy and Finance asking for the cancellation of the imposition of Anti-dumping duties since it violated the Agreement on Implementation of Article VI of the General Agreement on Tariffs and Trade 1994 (ADA).84 The Supreme Court ruled that the ADA is an ‘international treaty’ which sets out rights and obligations as between states. And due to the content and nature of the treaty, a legal dispute involving the agreement should be resolved in the WTO dispute settlement body. Thus, the ADA does not have direct effect and cannot be invoked by the parties in the Korean domestic courts.85 The Court observed that ‘a private party cannot bring a suit directly against the government of a member of the WTO in its domestic courts in order to invoke the violation of the ADA, to challenge the imposition of ant-dumping duties.’86 The court did not refer to the former Ordinances for School Food Service in the Province of Jeollabukdo case. Not surprisingly scholars such as Ju87 consider this decision as reinforcing their stand-point that WTO agreements generally do not have direct effect in the domestic Korean legal system.88 However, could this decision rest on the textual interpretation by the Court, correctly or incorrectly, of the specific provisions of the ADA, as not being able to have direct effect, in particular given that the Agreement specifically provides

78 ibid. 79 ibid.

80  Nohyung Park, ‘Korean Courts, Acceptance of International Law: Direct Effect of WTO Agreements’ (2006) 92 Justice 458–59 (in Korean). 81 ibid. 82 ibid. 83 ibid. 84  Supreme Court Decision, 2008Du17936, (2009) (in Korean). 85 ibid. 86  ibid (translated). 87  Jin-Yul Ju, ‘The Korean Supreme Court’s First Denial of Direct Effect to the WTO Agreement’ (2009) 1 Seoul International Law Journal 39-41 (in Korean). 88 ibid.

Practice 77

for an inter-state-based system of resolving disputes relating to the ADA? In the US–Section 301 Trade Act WTO case89 the Panel was open to the fact that some WTO obligations may and some may not produce direct effect. The Panel observed, albeit in a footnote, as follows: We note that whether there are circumstances where obligations in any of the WTO agreements addressed to Members would create rights for individuals which national courts must protect, remains an open question, in particular in respect of obligations following the exhaustion of DSU procedures in a specific dispute (see Eeckhout, P, The Domestic Legal Status of the WTO Agreement: Interconnecting Legal Systems, ­Common Market Law Review, 1997, p 11; Berkey, J, The European Court of Justice and Direct Effect for the GATT: A Question Worth Revisiting, European Journal of International Law, 1998, 626). The fact that WTO institutions have not to date construed any obligations as producing direct effect does not necessarily preclude that in the legal system of any given Member, following internal constitutional principles, some obligations will be found to give rights to individuals. Our statement of fact does not prejudge any decisions by national courts on this issue.90

A related question to the direct applicability issue is whether foreign business enterprises registered in Korea and foreign nationals can invoke the provisions of the WTO agreements with respect to Korean legislation and practices as they relate to trade? In principle this seems possible given that the State Compensation Act of Korea provides that remedies under Korean law are available to foreigners, subject to such remedies being available also to a Korean national in a similar law suit in the country of the foreign national.91 Thus, when this reciprocity condition is met, a foreign citizen or foreign enterprise can challenge measures of the Korean government or local public entities directly in the Korean courts and obtain redress.92 Moreover, foreigners are also qualified to bring a suit according to the Civil ­Procedure Act.93 In sum, although there is no doctrine of stare decisis operating in Korea’s civil law system, the jurisprudence of the courts, in particular the Supreme Court, carries weight. Given however the existence of some ambivalence in the interpretation of the deliberations of the courts and the seeming lack of consistency in the judgments, at the very least it can be observed that the jury is still out. Indeed, it

89 

WTO DS 152. ibid, para 7.72. State Compensation Act of Korea, Art 7 (Liability for Alien), ‘This Act shall apply only in cases where a mutual guarantee with a corresponding nation exists, if an alien is a victim’ (this Art wholly amended by Act No 8897, 14 Mar 2008), English version available at http://elaw.klri.re.kr/kor_ service/lawTotalSearch.do. 92  Moon-soo Chung, ‘Implementation of the results of the Uruguay Round Agreements: Korea’ in Jackson and Sykes, above n 8, 393. 93  Civil Procedure Act, Art 57 (Special Provisions for Litigation Capacity of Foreigners): ‘In case where a foreigner has a litigation capacity under the laws of the Republic of Korea, he shall be deemed to have a litigation capacity, even in case where he does not have such capacity pursuant to the laws of his home country.’ English version available at http://elaw.klri.re.kr/kor_service/lawTotalSearch.do. 90 

91  The

78  International Law in Domestic Legal Systems

would be controversial to categorically assert that there is no chance for a nonstate actor whether or not a national to claim rights reflected in WTO agreements in the Korean domestic courts. Thus, although Korea does not appear to have institutionalised a comparable mechanism such as Section 301 in the US or the Trade Barriers Regulation in the EU to enable non-state actors to voice concerns about illegal trade practices in third countries, direct applicability within Korea at any rate to some extent serves the purpose of arming non-state actors with respect to Korean WTO law inconsistencies.

ii.  Constitutional Arrangements for Treaty-making94 Under the Korean Constitution there is a set relationship between the different organs of the government in the process of treaty-making, implementation and foreign policy practice. Thus, Article 60 above specifically stipulates that with respect to the conclusion and ratification of certain important types of treaties, expressly adumbrated, the National Assembly ‘shall have the right to consent to the conclusion and ratification of ’ such agreements. This list of types of treaties is generally considered to be exhaustive, and understood to inculcate the executive process of treaty-making with a measure of parliamentary democracy and accountability.95 In the same vein, certain foreign policy issues, such as the declaration of war, require the consent of the National Assembly. However, the President, in whom the prerogative for treaty and foreign policy-making rests,96 need not seek the National Assembly’s consent in emergency situations.97 Finally, of note is that the judicial organ in Korea has ruled to ensure effective implementation of international agreements, where individual rights constitutionally enshrined are undermined by the State’s lack of effective utilisation/implementation/enforcement of the international agreement.98

iii. Conclusion In conclusion, generally the relationship of International Law and domestic law under the Korean Constitution has a number of features that commends it to a positive NEA regional matrix. Thus, generally there is direct applicability of International Law norms and one specifically entrenched for the protection of aliens, subject to the self-executing nature of those norms. Moreover, there is a measure of parliamentary oversight of the executive’s treaty-making powers i­ncluding

94  See Korean Foreign Ministry website for a detailed description of the Korean treaty-making apparatus: http://www.mofa.go.kr/ENG/policy/treaties/treaties/treaty/domestic/index.jsp?menu=m_ 20_30_10&tabmenu=t_3. 95  Chung, above n 43, 55–56. 96  See Art 73 of the Korean Constitution. 97  See Art 76 of the Korean Constitution. 98  Korean Constitutional Court: 2008 Hun Ma 648, and 2006 HunMa 788.

Practice 79

f­oreign policy practice—as well as some judicial oversight with respect to the implementation of international agreements.

C. Japan99 Authority to conclude international agreements is set out under the Japanese Constitution as follows: Article 73. The Cabinet, in addition to other general administrative functions, shall ­perform the following functions: … Conclude treaties. However, it shall obtain prior or, depending on circumstances, subsequent approval of the Diet.

Thus, the normal practice is to seek approval of the Diet before Japan becomes bound by the treaty.100 Approval of the Diet is required as a matter of constitutional practice where the international agreement: (1) necessities legislative changes or continuation of existing legislation; (2) involves expenditure; and/or is (3) a politically important agreement.101 Agreements involving the Diet’s approval, whether prior or subsequent, are the subject of a formal promulgation, which once made, gives the agreement domestic effect.102 All other agreements, which are known as executive agreements, not needing the Diet’s approval, can be entered into by the Cabinet in furtherance of the management of foreign affairs.103 The government decides whether an agreement is a treaty requiring approval of the Diet or is in the nature of an executive agreement.104 Furthermore, the ­Cabinet’s authority includes the power to interpret, implement and terminate international agreements.105 The relationship between the Japanese domestic legal system and International Law is described in the Japanese Constitution as follows: Article 98. This Constitution shall be the supreme law of the nation and no law, ordinance, imperial rescript or other act of government, or part thereof, contrary to the provisions hereof, shall have legal force or validity. 99  Yuji Iwasawa, ‘The Relationship between International Law and National Law: Japanese Experience’ in British Yearbook of International Law, vol 64 (Oxford, OUP, 1993) 333–90; Takao Kawakami, ‘National Treaty Law and Practice: Japan’ in Duncan B Hollis et al (eds), National Treaty Law & Practice (Leiden, Martinus Nijhoff, 2005) Ch 12; Kanami Ishibashi, ‘Implementing of International Law in Japanese Courts: From their Traditional Reluctance in Invoking International Law to some Innovative Rulings Based upon International Human Rights Law’ (2015) 3(2) The Korean Journal of International and Comparative Law 139–70. 100  See Yuji Iwasawa, ‘Implementation of International Trade Agreements in Japan’ in Meinhard Hilf and Ernst-Ulrich Petersmann (eds), National Constitutions and International Economic Law (Alphen aan den Rijn, Kluwer, 1993) 302. 101  See Kwakami, above n 99, 419–20. 102  See Art 7 of the Japanese Constitution and Kwakami, above n 99, 424. 103  ibid, 415. 104  Iwasawa, above n 100, 304. 105  See Art 4 of the Law for the Establishment of the Ministry of Foreign Affairs as cited in Kwakami, above n 99, 415 and 421.

80  International Law in Domestic Legal Systems The treaties concluded by Japan and established laws of nations shall be faithfully observed.

Thus, international agreements and General International Law viz Customary International Law and General Principles of Law, are to be faithfully observed within the Japanese domestic legal system. It is generally believed that the reference to ‘faithfully’ implies that domestic law which is contrary to an international agreement having force of law in Japan, will not be given effect, even if the domestic law is subsequent in time to the treaty.106 Executive agreements however do not have such a higher rank in terms of domestic law.107 An international agreement as has already been stated will have the force of law in Japan if it is duly promulgated. Moreover, self-executing international norms binding Japan can be given direct effect. International norms can also be given indirect effect when Japanese law is construed with reference to International Law.108 However, generally and historically courts have been reluctant to apply international norms.109 There are two reasons for this. First, possible lack of knowledge of International Law norms since this is a discipline that is not compulsory for the national bar examinations,110 despite Article 98 of the Japanese Constitution. Second, judicial restraint and conservatism in terms of overturning the domestic legal order and intruding on the executive foreign policy-making powers.111 Thus, Japanese courts have not given direct effect to GATT 1947.112 With respect to trade law the Kyoto Necktie case is particularly cited wherein the Supreme Court of Japan approved the lower court rulings that GATT 1947 did not have direct effect in Japan.113 This case has however been criticised;114 and it has been asserted that WTO agreements, to the extent the provisions are self-executing, will prevail over domestic law.115 However, in the field of human rights Japanese courts have shown greater deference to International Law particularly with respect to ‘­children, minorities and foreigners’.116

106  See Mitsuo Matsushita, ‘Constitutional Framework of the Major Trade Laws in Japan: In the Context of the Uruguay Round’ in Meinhard Hilf and Ernst-Ulrich Petersmann (eds), National ­Constitutions and International Economic Law (Alpen aan den Rijn, Kluwer, 1993). See also Iwasawa, above n 100, 311 and 328. 107  Iwasawa, ibid 329. 108  See Ishibashi, above n 99. 109 ibid. 110 ibid. 111 ibid. 112 See Nishijin Necktie case, Case No 1979 (Wa) 44, 44,530 Hanrei Taimuzu 265 (Kyoto Dist Ct, 29 June 1984) and Case No 1987 (o) 168, 36 (12) Syoumu Getsupo 2242 (Supreme Ct, Feb 6,1990) cited in Ishibashi, above n 99. 113  Japan SC Judgment of February 6, 1990. See Iwasawa, above n 100, 302 and M Matsushita, P Schoenbaum, T Mavroidis and M Hahn, The World Trade Organization (Oxford, OUP, 2015) 41–43. 114  Iwasawa, above n 100. 115  Matsushita, Schoenbaum, Mavroidis and Hahn, above n 113, 41–43. 116  Ishibashi, above n 99.

Conclusion 81

IV. Conclusion This brief survey of the three jurisdictions in NEA reveals a divergence in the manner in which International Law has been received as between the three jurisdictions with Korea and Japan at one end of the relationship spectrum with International Law and China at the other end. The Korean Constitution and practice has the most to commend it in the degree to which International Law is integrated in the domestic system. Equally there are more similarities as between the Korean and Japanese Constitutions, in particular with respect to the domestic arrangements with respect to treaty-making. However, in all three States (and this is generally also worldwide) the relationship between the domestic and international legal order is complex with a number of ambiguities in the Constitutions. The following three suggestions are proffered here for policy-makers in the three jurisdictions. First, that there is the need for a reappraisal within each State in NEA, as well as coordination amongst the three States, of the manner in which each State should arrange the relationship between International Law and its domestic law respectively, so as to better integrate International Law in the domestic system. This appraisal is not just a domestic matter since it has a bearing on other countries. In the absence of such coordination, is there a case for introducing conditional direct applicability on the basis of reciprocity; or of introducing adjustment costs at the border, where this is possible, so that the asymmetry in the integration levels does not give any State an advantage over the other? In sum, there are a host of considerations here that need to be consciously and proactively reflected upon both at the national and regional levels, including at the time of treaty negotiations between different States. Second, the reappraisal should contribute to more clarifications in the apparatus and description of the relationship between domestic and International Law, as well as ensure the operation of the doctrine of separation of powers in this sphere of State activity. Finally, there is the need for the introduction of compulsory teaching of International Law in Law Schools (including for professional exams), and the continuing education of judges in International Law, including co-operation between the respective judicial organs within NEA, with matters of International Law as they involve inter-se relations.

82 

Part Two

International Law in North East Asia: Generally

84 

4 The Pursuit of Justice in the Historically Charged North East Asia ‘Justice is as much set in a common understanding of injustice as it is set in its actual realisation.’ Asif H Qureshi

I. Introduction Many of the conflicts in North East Asia (NEA) have a regional historical setting. This is mainly rooted in the Japanese imperial past, and the post-war re-organisation of NEA in response to Japanese involvement in the Second World War The gravity of the conflicts varies and the real sources of the conflict need not originate alone in Japan. Some ‘conflicts’ may not be properly speaking in the nature of a conflict, if a ‘conflict’ is defined in terms of a substantive underlying unresolved claim, in particular one that could escalate into a serious threat to the peace of the region, and one that may be justiciable in a court of law. Thus, the ‘dispute’ between Korea and Japan over the nomenclature of the sea area that is surrounded by Japan, the two Koreas and Russia with their respective maritime zones, is not properly speaking a conflict with an underlying substantive unresolved claim as such, that could lead to the use of force or that could be resolved in a court of law. This disagreement is essentially a claim by Korea of the usurpation/displacement of the name ‘East Sea’ by Japan, during the Japanese imperial era and its replacement with the name ‘Sea of Japan’—and as such it is an effort by Korea to correct what it perceives as a historic wrong.1 Both parties 1  Note North Korea claims the name to be Korean East Sea. See generally work of the UN Conference on Standardisation of Geographical Names https://unstats.un.org/unsD/geoinfo/UNGEGN/ default.html—in particular for example para 190 of the Report of the United Nations Group of Experts on Geographical Names on the Work of its Seventeenth Session (1994). For Japanese perspective see Japanese foreign Office: http://www.mofa.go.jp/a_o/na/page1we_000110.html. For Korean perspective see Korean foreign office https://www.mofa.go.kr/ENG/policy/focus/eastsea/index. jsp?menu=m_20_10_20.

86  Justice in the Historically Charged NEA

have founded their assertions inter alia on historical grounds; the practice of States including relations as between Korea and Japan when first normalised through an agreement in 1965; evidence in world maps and deliberations in the UN, in particular the United Nations Conference on the Standardization of Geographical Names; and the deliberations of the International Hydrographic Organization— an organisation set up in 1921 for ‘the safety of navigation and the protection of the marine environment.’2 Korea’s claim is that both descriptions should be used given that there is disagreement, in particular because it contends that the international rules in such circumstances recommend this course of action.3 Japan on the other hand is adamant that only the description the Sea of Japan can be used. This disagreement is symptomatic of the deep emotional scars that still haunt the region—so much so that both Japan and Korea both go out of their way to assert their respective cases quite forcefully on their foreign office websites. In such an atmosphere characterising this as not a conflict but a mere disagreement could itself be considered controversial. In contrast to this nomenclature issue, at the other end of the scale of the gravity of disputes is the North Korea denuclearisation effort, which has a real potential for escalating into a nuclear war. In between these two extremes are other disputes such as the island territorial disputes—which have the potential of some skirmishes in the sea, with the possibility of escalating further; and raising the prospect of economic sanctions. In sum, the historically entrenched disputes pose different degrees of dangers, which moreover can spiral into other disputes, as for example the dispute between China and Korea arising from the recent installation of the Terminal High Altitude Area Defense (THAAD) system in Korea, as a defence to North Korean nuclear armament and threat. In this chapter the focus will be on some key disputes as between the different States in NEA that have generated much attention and controversy within NEA, and that have a historical setting. The purpose of this chapter however is not intended to be judgmental in terms of the disputes, rather it is to highlight the principal facts and the main issues within the context of the relevant legal framework. In this vein, the following principal disputes will be focussed upon: the Dokdo/Takeshima Islands dispute between Korea and Japan; the Senkaku/ Diaoyu Islands dispute between China and Japan; the Comfort Women dispute as between Korea and Japan; and finally, the question of denuclearisation in the Korean peninsula. This adumbration of issues touches on Korean/Japanese and Chinese/­Japanese relations as well as relations with North Korea. The issues involve mainly the Law of the Sea; International Human Rights and Humanitarian Law; and the Law on Nuclear Disarmament.

2 https://www.iho.int/srv1/index.php?option=com_content&view=article&id=298&Itemid=297& lang=en. 3  See International Hydrographic Organization Technical Resolution A4.2.6 International Standardization of Geographical Names (1974); and United Nations Resolution on the Standardization of Geographical Names III/20 Names of features beyond a single sovereignty (1977).

The Law of the Sea and NEA Island Disputes 87

There are two fundamental questions here that need reflection from the perspective of contextualising International Law to these historically rooted issues. First, should the context of International Law be a facilitator for the reorganisation of the underlying causes and circumstances of the conflict or should International Law be a source for the adjudication of the conflicts? Much of the discourse both at the academic and political level has involved law as a source for the adjudication of the conflicts. The latter is a difficult course as the law in question here is on occasions unfair, on occasions fair but difficult to apply and difficult to apply because of a reluctance to avail of an adjudicative forum. Second, historic issues that call for rectificatory justice need also be informed by a notion of ‘sustainable justice’. The idea of sustainable justice here derives from sustainable development and begs the question when is it appropriate for a generation (or two) to burden future successive generations with its sense of injustice.

II.  The Law of the Sea and NEA Island Disputes The law of the sea concerned with the waters in the area in NEA comprises mainly that which is set in the United Nations Convention on the Law of the Sea of 10 December 1982 (UNCLOS). The States having a direct presence in the NEA waters are China, Korea, Japan, Russia, and to some extent Taiwan. In addition, the United States has a strategic interest in these waters, assured in particular through its Mutual Defence Agreements between itself and Korea4 and Japan5 respectively.6 China, Korea, Japan and Russia have all ratified UNCLOS. Taiwan is not a party to UNCLOS; and the USA and North Korea have signed but not ratified UNCLOS. United States and in some measure Japan7 have ratified the Geneva Conventions on the Law of the Sea 1958;8 China has signed but not ratified the Geneva Conventions on the Law of the Sea, and North Korea is not a party to those Conventions at all. In the circumstances the Law of the Sea in the NEA region comprises essentially of UNCLOS, the Geneva Conventions of the Law of the Sea to the extent relevant, and the customary international law of the sea developed against the background of the Geneva Conventions on the Law of the Sea and UNCLOS. 4  See Mutual Defence Treaty Between the United States and the Republic of Korea; October 1, 1953 in particular Art IV which states: ‘The Republic of Korea grants, and the United States of America accepts, the right to dispose United States land, air and sea forces in and about the territory of the Republic of Korea as determined by mutual agreement.’ 5  US and Japan Mutual Defence Assistance Agreement March 8, 1954. 6  See Mutual Defence Treaty Between the United States and the Republic of Korea; October 1, 1953 and the US and Japan Mutual Defence Assistance Agreement March 8, 1954; and the Treaty of Mutual Cooperation and Security Between the USA and Japan 1960, in particular Art VI. 7  Japan ratified the Convention on Territorial Sea and Convention on High Seas only. 8 Convention on the Territorial Sea and the Contiguous Zone 1958; Convention on the High Seas 1958; Convention on Fishing and Conservation of the Living Resources of the High Seas 1958; ­Convention on the Continental Shelf 1958.

88  Justice in the Historically Charged NEA

All three States in NEA have a critical dependency on the sea. The sea is important for transportation and communication (cables/internet), particularly given that all three States are significant trading nations. Much of international trade takes place through sea transport. The NEA sea is also important for its resources (fishing/mining); and the access it gives to different parts of the world to different States. It is, in addition, the legacy of a space where the western liberal and communist ideologies still confront each other, cemented through security arrangements between the US and Korea/Japan respectively; where several disputed Islands/Rocks claims fester (viz, Dokdo/Takeshima Islands dispute between Japan and Korea, the dispute between China and Japan over the Senkaku/Diaoyu Islands in East China Sea, the disagreement between Korea and Japan with respect to the location of the Ieodo Ocean Research Station in unchartered Exclusive ­Economic Zones (EEZ) as between Korea and China); where unresolved maritime zone demarcation issues exist (viz, as between North Korea and South Korea with respect to the unilaterally imposed Northern Limit Line (NLL) on North Korea— a de facto continuation of the territorial line of demarcation between the North and South Koreas, brought about under the Korean Armistice Agreement 1953; as between China and North Korea with respect to the demarcation of the EEZ and Continental Shelf; as between Japan, China and Korea respectively of their EEZ and Continental Shelves respectively); and where unclear rights of passage exist through different straits, for example, the Korea and Jeju Straits,9 including the conditions for the rights of passage of warships.10 All of these unresolved issues pose flash points for armed naval conflicts. Consequently, these waters have strategic security aspects, as evidenced by the presence of warships from the US, China and Russia. A brief comparative view of the respective legislation concerned with maritime zones including claims contained therein of China, Korea and Japan that touch upon some of the contentious issues is in order here. These provide focus on the contentious issues of historical origin but also set the context for their consideration. First, relevant Chinese legislation concerning the law of the Sea is to be found in the Law on the Territorial Sea and the Contiguous Zone of 25 February 1992.11 This legislation describes the Chinese territory to include ‘Taiwan and the various affiliated islands including Diaoyu Island, Penghu Islands, Dongsha Islands, Xisha Islands, Nansha (Spratly) Islands and other islands that belong to the People’s Republic of China. …’;12 it asserts the use of the straight base line method to delineate the Chinese base line;13 and finally it requires foreign warships to

9  Seokwoo Lee and Hee Eun Lee, The Making of International Law in Korea (Leiden, Nijhoff, 2016) 180, 188, 227 and 237. 10  Park Hee Kwon, The Law of the Sea and Northeast Asia: A Challenge for Cooperation (Alphen aan den Rijn, Kluwer, 2000) 32. 11 http://www.un.org/Depts/los/LEGISLATIONANDTREATIES/PDFFILES/CHN_1992_Law.pdf. 12  Art 2 of Law on the Territorial Sea and the Contiguous Zone of 25 February 1992. 13  ibid, Art 3.

The Law of the Sea and NEA Island Disputes 89

obtain permission from China to enter its territorial waters.14 With respect to China’s description of the Diaoyu Island as its territory and its demarcation of the territorial sea of this Island15 Japan responded to the UN in a note in 2012; which in material parts reads as follows: There is no doubt that the Senkaku Islands are an inherent part of the territory of Japan in light of historical facts and based upon international law. The Senkaku Islands arc under the valid control of the Government of Japan. There exists no issue of territorial sovereignty to be resolved concerning the Senkaku Islands.16

Details of China’s claims with respect to the EEZ and Continental Shelf are contained in China’s Exclusive Economic Zone and Continental Shelf Act 1998. With respect to opposite and adjacent States in the EEZ and Continental Shelf the demarcation is to be settled ‘on the basis of international law and in accordance with the principle of equity, by an agreement delimiting the areas so claimed.’17 Moreover, the determination of the EEZ and Continental Shelf is subject to the ‘historical rights of the People’s Republic of China.’18 China has made in accordance with the procedures set in UNCLOS a claim for its Continental Shelf beyond 200 nautical miles on the basis of natural prolongation to the UN Commission on the Limits of the Continental Shelf.19 Japan has objected to this submission on the grounds that such a claim cannot be made unilaterally where there is an opposite State involved and that China and Japan need to come to an agreement on this.20 The Chinese demarcation approach towards its maritime zones with Korea are also based on the basis of natural prolongation (contra equidistance line with North Korea).21 The Korean legislation and its claims to its coastal maritime zones in relevant parts are as follows. First, the Korean approach to delineating its base lines involves the use of straight base lines only in the area of the sea ‘where special geographical circumstances exist.’22 Second, with respect to the territorial sea and

14 

ibid, Art 6. See Deposit of a chart and of a list of geographical coordinates as contained in the Statement of the Government of the People’s Republic of China on the Baselines of the Territorial Sea of Diaoyu Dao and its Affiliated Islands to UN dated 2012 http://www.un.org/Depts/los/LEGISLATIONANDTREATIES/PDFFILES/mzn_s/mzn89ef.pdf. 16 Communication from the Government of Japan dated 24 September 2012 at http://www. un.org/Depts/los/LEGISLATIONANDTREATIES/PDFFILES/DEPOSIT/communicationsredeposit/ mzn89_2012_jpn.pdf. 17  Art 2 of the Exclusive Economic Zone and Continental Shelf Act 1998 http://www.un.org/Depts/ los/LEGISLATIONANDTREATIES/PDFFILES/chn_1998_eez_act.pdf. 18  ibid, Art 14. 19  See http://www.un.org/Depts/los/clcs_new/submissions_files/submission_chn_63_2012.htm. 20  See Japanese letter to UN dated 28 December 2012. 21  See Lee and Lee, above n 9, 252. 22  See Art 2 of the Territorial Sea and Contiguous Zone Act Promulgated on 31 December 1977 Amended by Law No 14607, and promulgated on 21 March 2017 http://www.un.org/Depts/los/ LEGISLATIONANDTREATIES/PDFFILES/Territorial_Sea_and_Contiguous_Zone_Act_Law_ No_14670_21_March_2017.pdf. 15 

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contiguous zone, in the absence of an agreement between the States concerned, the ­demarcation ‘shall be the median line every point of which is equidistant from the nearest point on the baseline of the Republic of Korea and the nearest point on the baseline of the State concerned.’23 With respect to foreign warships prior notice is required.24 Moreover foreign ships do not have the right of passage where this is ‘prejudicial to the peace, public order or security of the Republic of Korea.’25 This is further elaborated upon with a list of circumstances considered to be so prejudicial which includes inter alia ‘the … taking on board of any military device’.26 With respect to adjacent/opposite States the EEZ is to be demarcated ‘by agreement with the States concerned on the basis of international law.’27 However, with respect to the exercise of the sovereign rights over the EEZ ‘unless otherwise agreed upon between the Republic of Korea and the State concerned’, these ‘shall not be exercised in the area of the sea beyond the median line between the Republic of Korea and the State concerned.’28 With respect to Korea’s Continental Shelf beyond 200 nautical miles from the base lines of its territorial sea Korea has thus far notified the Commission on the Limits of the Continental Shelf its claim in the East China Sea—the outer limits of which are located in the Okinawa Trough based on the natural prolongation of its Continental Shelf.29 This claim is ­without prejudice to any adjustments that may ensue as between adjacent and opposite States concerned through consensus. Japan on the other hand has made it clear that it considered that the Commission cannot consider Korea’s submission, as this area of the sea is the subject of dispute between Korea and Japan.30 With respect to the Continental Shelf in the northern part adjacent to Korea and Japan, the two countries have agreed to a demarcation as between themselves.31 On the other hand, in relation to the southern part of the continental shelf adjacent to Korea and Japan, the two countries have agreed on a Joint Development Zone, without prejudice to their respective sovereign rights to this part of the Continental Shelf adjacent to their coasts.32 With respect to the Korean approach to its

23 

ibid, Art 4. ibid, Art 5. 25 ibid. 26  See Art 5 of Korean Territorial Sea and Contiguous Zone Act Law No 3037, Promulgated on 31 December 1977 Amended by Law No 4986, which was promulgated on 6 December 1995. 27  Art 2 Exclusive Economic Zone Act No 5151, Promulgated on 8 August 1996 http://www.un.org/ depts/los/LEGISLATIONANDTREATIES/PDFFILES/KOR_1996_EEZAct.pdf. 28  ibid, Art 5. 29  See Korea’s Partial Submission To the Commission on the Limits of the Continental Shelf P ­ ursuant to Article 76 Paragraph 8 of the United Nations Convention on the Law of the Sea Executive Summary http://www.un.org/depts/los/clcs_new/submissions_files/kor65_12/executive_summary.pdf. 30  See exchanges of Korea and Japan with the Commission on this at http://www.un.org/depts/los/ clcs_new/submissions_files/submission_kor_65_2012.htm. 31  Agreement between Japan and the Republic of Korea concerning the establishment of boundary in the northern part of the continental shelf adjacent to the two countries 1974. 32  See Agreement concerning joint development of the southern part of the continental shelf adjacent to the two countries, 30 January 1974 in particular Art XXVIII. 24 

The Law of the Sea and NEA Island Disputes 91

maritime zones facing China, Korea takes the median line approach in contrast to its natural prolongation approach with Japan.33 The baseline used by Japan to measure its territorial sea involves the low-water line except, straight base line and straight base lines used across mouths of rivers and bays.34 In the case of adjacent and opposite coasts of the territorial sea, contiguous zone, the EEZ and the Continental Shelf the outer limits run up to the median line in these zones.35 In so far as the passage through territorial waters of foreign warships is concerned Japan recognises such a right in accordance with UNCLOS.36 With respect to the coordinates submitted by Japan of its territorial sea China submits in a letter to the Secretary General of the UN of 14 March 2008: Japan illegally marks Diaoyu Islands as Senkaku Shoto and delimits their territorial seas. The Chart also illegally marks Diayu Dao (Diaoy Island), Huangwei Yu (Huangwei Island) and Chiwei Yu (Chiwei Island) respectively as Uotsuri Shima, Kuba Shina and Taisho To). Diaoyu Islands have been part of the territory of China since ancient times. The i­llegal markings on those Islands and their territorial seas by Japan severely violates the ­sovereignty of China and the right of China to delimit its territorial sea.37

To this Japan responded in a letter dated 20 June 2008: In the light of historical facts and based upon international law there is no doubt that the Senkaku Islands are inherent territories of Japan. As a matter of fact, Japan validly controls these islands. Therefore, there is no territorial dispute to be resolved with respect to the Senkaku Islands and the description of the Senkaku Islands as well as their territorial sea on the Chart concerned is legitimate.38

It is evident that there are differences here between the three States in the manner in which the Law of the Sea is interpreted and applied. First, it will be noted that China’s legislation on base lines emphasises the use of the straight base line as a norm. The Japanese legislation on the face of it is equivocal in terms of the type of base line used, although one observer has pointed out that in practice

33 

See for example Lee and Lee, above n 9, 252. Art 2 of Law on the Territorial Sea and the Contiguous Zone (Law No 30 of 1977, as amended by Law No 73 of 1996). 35  See Arts 1 and 4 of Law on the Territorial Sea and the Contiguous Zone ibid and Arts 1 and 2 of the Law on the Exclusive Economic Zone and the Continental Shelf (Law No 74 of 1996). 36  See Park Hee Kwon, The Law of the Sea and Northeast Asia: A Challenge for Cooperation (Hague, Kluwer Law International, 2000) 33. It is not clear to this author where the Japanese position has been spelt out explicitly with respect to the passage of foreign warships through Japanese territorial waters. 37 Letter to UN Secretary-General dated 14 May 2008 by China. http://www.un.org/depts/los/­ LEGISLATIONANDTREATIES/STATEFILES/JPN.htm. 38  Letter to UN Secretary-General 20 June 2008, available at ibid. 34 

92  Justice in the Historically Charged NEA

Japan has used the straight base line liberally.39 The Korean approach as set out in its legislation reflects the UNCLOS formulation more closely. Moreover, the Korean legislation is clearly drafted in this respect. Second, both the Korean and Japanese legislation with respect to demarcation of the maritime zones involving adjacent/opposite States take a self-restraining approach drawing the line up to the median line. However, all three States seem to regard agreement as the only manner of demarcation in such situations of overlapping maritime zones without any reference to third party adjudication. Third, the stance of China is explicitly different when it comes to the innocent passage of foreign warships through its territorial waters. China requires prior permission for warships. This has prompted one observer to comment on the Chinese legislation’s compatibility with UNCLOS.40 The passage of foreign warships through Korean territorial waters only requires prior notice, however this passage is prohibited if it is prejudicial to the peace and security of Korea.41 In the same vein although the Japanese practice seems most tolerant of innocent passage in this respect, this tolerance is not unqualified when the passage is prejudicial to its sovereign interest.42 Thus, passage of their warships in each other’s territorial waters cannot be lightly presumed. Finally, the historical disputes are entrenched and intertwined with contemporary maritime demarcation issues in the practice of all three countries. The interpretation and application of Law of the Sea by the States of NEA is informed by their historical disputes inter-se, as well as the role played by the sea in the NEA in facilitating western encounters within the region. In sum, herein historical disputes and enmities exacerbate the resolution of contemporary issues generated by developments in the Law of the Sea (including some uncertainties in it); and advancements in modern technologies in shipping transport/communications and deep-sea mining and exploration which make the maritime zones more accessible and exploitable. In particular, the lack of general consensus amongst the States of NEA with respect to the demarcation of the various maritime zones in the seas of NEA is contributed to by a number of factors. First, in NEA there is evidence of a liberal use of the straight base line method of demarcating base lines from which the outer limits of maritime zones are delineated, despite the fact that this is an exceptional method to be availed under certain specific geographical conditions.43 This is in particular evident from the Chinese legislation relating to its maritime zones.

39 

See Kwon, above n 36, 27. ibid, 36. 41  See Art 5 supra of Korean legislation, above n 26. 42  See also Japan’s response to the entry of patrol ships into Japanese territorial waters around the Senkaku Islands in 2012: http://www.mofa.go.jp/announce/announce/2012/7/0712_01.html. 43  See Arts 5 and 7 of UNCLOS and the Anglo Norwegian Fisheries Case (UK vs Norway) ICJ 1951. 40 

The Law of the Sea and NEA Island Disputes 93

Second, the criteria for the demarcation of the territorial sea,44 the continental shelf45 and the EEZ46 seems imprecise under UNCLOS and General International Law, in the event of adjacent and opposite coastal States. Thus, reference to the territorial sea factors that can displace the application of the general rule of the median line viz historical title and special circumstances can be the subject of controversy. In the same vein, with respect to the demarcation of the continental shelf and the EEZ, the UNCLOS criteria simply refers to the application of the rules in International Law with a view to an equitable solution. Under Customary International Law with reference to the territorial sea, continental shelf and the EEZ, equitable principles operate in the delineation process, and call for as a matter of methodology in the first instance, the application of a provisional equidistance demarcation to be adjusted with reference to any special or relevant circumstance, so as to produce an equitable solution.47 The special and relevant circumstances to be taken into account may include natural prolongation, the configuration and length of the coast line, presence of islands, security and conduct of the parties.48 In so far as the presence of islands is concerned generally the presence of small islands in existing jurisprudence has been ‘given no effect or only a very limited effect in any maritime delimitation line drawn by a judicial or arbitral t­ ribunal.’49 In sum, whilst the parameters of the relevant/special circumstance are set, the range of considerations that may be taken into account and the weight to be given to them ultimately involves the exercise of judgement. Importantly however, within the context of this work, this approach to demarcation of maritime disputes is indeed a very contextualised approach, and one that lends itself to taking

44  Art 15 of UNCLOS ‘Delimitation of the territorial sea between States with opposite or adjacent coasts where the coasts of two States are opposite or adjacent to each other, neither of the two States is entitled, failing agreement between them to the contrary, to extend its territorial sea beyond the median line every point of which is equidistant from the nearest points on the baselines from which the breadth of the territorial seas of each of the two States is measured. The above provision does not apply, however, where it is necessary by reason of historic title or other special circumstances to delimit the territorial seas of the two States in a way which is at variance therewith.’ See also Art 12 of the Geneva Convention on the Territorial Sea 1958. This principle in Art 15 has been described as the ‘equidistance/special circumstances’ principle (see M Shaw, International Law 6th edn (Cambridge, CUP, 2008) 591 and Qatar v Bahrain (ICJ: 2001). 45  Art 83 ‘Delimitation of the continental shelf between States with opposite or adjacent coasts 1. The delimitation of the continental shelf between States with opposite or adjacent 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.’ See also Art 6 of the Continental Shelf Convention 1958. 46  Art 74 ‘Delimitation of the exclusive economic zone between States with opposite or adjacent coasts 1. The delimitation of the exclusive economic zone between States with opposite or adjacent 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.’ 47  See Shaw, above n 44, 605–06. 48  See ibid, 606. 49  See Jon M Van Dyke in Seokwoo Lee and Hee Eun Lee (eds), Historical Appraisal and International Justice (Leiden, Martinus Nijhoff, 2011) 38.

94  Justice in the Historically Charged NEA

into account historical aspects, relevant considerations and special circumstances. As such this approach to demarcation as it has evolved cannot surely be rejected so lightly. It is a sophisticated approach that injects a contemporary sense of justice to the process. This is underlined by the fact that the International Court of Justice has presided over a number of maritime delimitation issues between different countries and their judgment has been accepted as final. Third, judging from the national legislation there seems to be a perception that the only method of demarcating maritime boundaries is through agreement. This of course is not the case and maritime boundaries can be determined through third party adjudication as set out in UNCLOS. Fourth, with respect to the demarcation of the contiguous zone as between opposite and adjacent States it seems UNCLOS is silent on this issue,50 although some States (Korea and Japan) have adopted in their domestic legislation the median line for this purpose. Finally, given the number of issues involved it is possible that agreement is best achieved within the context of an overall settlement amongst concerned States, as a State may not want to create a precedent with respect to an issue with one State alone, for fear of being compromised in its negotiations with respect to a similar issue in relation to another State. Therefore, a global approach to the resolution of all the issues may be a better option.51 In the circumstances this dangerous cocktail of issues in the NEA sea has meant a considerable engagement of the Law of the Sea both at the State and academic levels,52 although alas not in judicial fora in the resolution of the issues that plague the NEA sea waters. Thus, Korea, China, Russia and Japan were active participants in the negotiations for UNCLOS,53 and all three NEA States currently have their respective nationals occupying judicial appointments in the International Tribunal for the Law of the Sea. However, both China and Korea have excluded from the jurisdiction of the International Tribunal on the Law of the Sea disputes relating to sea boundary delimitations and military operations. Both China and Korea have also not consented to the compulsory jurisdiction of the International Court of Justice under Article 36 (2) of its Statute. Japan’s consent to the compulsory jurisdiction of the ICJ on the other hand is limited to disputes arising post 15 September 1958 and also excludes disputes concerning research, conservation and management of living resources of the sea.

50 

See Kwon, above n 36, 36. For similar opinion see for example Jon M Van Dyke in Lee and Lee, above n 49, 39. 52  Boo-Chan Kim, ‘The system for dispute settlement in the law of the sea and Korean standpoint’ in Choong-Hyun Paik (ed), International Law in Korean Perspective (Seoul, Seoul National University Press, 2004); Keun-Gwan Lee, ‘A critical perspective on maritime delimitation in East Asia’ in Paik, ibid; Kwon, above n 36, Chs 2–5; Zou Keyuan, Law of the Sea in East Asia (Abingdon, Routledge, 2005); Yoshifumi Tanaka, The International Law of the Sea (Cambridge, CUP, 2015); Lee and Lee,above n 9, Chs 3 and 4; Onuma Yasuaki, International Law in a Trans civilizational World (Cambridge, CUP, 2017) 294–328. 53  See for example Kwon, above n 36, 14. 51 

The Law of the Sea and NEA Island Disputes 95

A. Dokdo/Takeshima54 Islands Dispute between Japan and Korea The Dokdo/Takeshima islands have been described variously as comprising of two rocky islets and seven smaller rock outcroppings located in the East Sea/Sea of Japan. Korea refers to the islands as Dokdo, and the Japanese describe it as Takeshima. Geographically the islands are located about 55 miles from the Korean island of Ullungdo and about 99 miles from Japan’s OKI Island. Both Japan and Korea have territorial claims over the islands but the islands currently are in effective possession of Korea. The territorial claims of both countries have meant that the demarcation of the maritime zones (including the Continental Shelf and the EEZ) in the region also remain unresolved. There has been a considerable amount of literature on the issue of the title to the islands, in particular from writers of Korean origin.55 Briefly, the traditional modes of territorial acquisition recognised under ­International Law, of particular relevance here, are discovery accompanied by effective occupation; prescription; cession/annexation set against the background of other principles such as acquiescence/estoppel, recognition, contiguity/natural unity of Islands. For discovery the territory must be terra nullius; and in the case of the discovery of the territory belonging to another State, the territory needs to have been abandoned by the other State through a clear animus derelinquendi. For prescription there needs to be the exercise of sovereign authority that is peaceful, public and uninterrupted that endures for a certain period of time. Two preliminary points need to be addressed at the outset in considering title to the islands. First, there is the question whether there is a ‘dispute’ as between Japan and Korea over the islands. Korea maintains there is no dispute and that Dokdo is not ‘a matter to be dealt with through diplomatic negotiations or j­ udicial ­settlement.’56 On the other hand, Japan is of the view that there is a territorial

54 

Also known as the Liancourt Islands in western deliberations. See for example Japanese and Korean Foreign Office Websites: Korean Ministry of Foreign Affairs Video ‘Dokdo: Beautiful Island of Korea’; Japanese Ministry of Foreign Affairs Video and Pamphlet ‘Takeshima—Seeking a Solution based on Law and Dialog’; Yoshiro Matsui, ‘International Law of Territorial Acquisition and Dispute over the Senkaku (Diaoyu) Islands’ (1997) 40 Japanese Annual of International Law 3; Younsu Ha, ‘Re-thinking of “the Dispute on Takeshima Islands”: From the view point of International Law’ (1999) 2 Ryokoku Law Review 227–86; Park Hee Kwon, International law and the Republic of Korea: A Glimpse of Current International Legal Issues (Seoul, Korea Law of the Sea Society, 2006); Jon M Van Dyke, ‘Legal Issues Related to Sovereignty Over Dokdo and Its ­Maritime Boundary’ (2007) 38(1–2) Ocean Development & International Law 157–224; TJ Schoenbaum, ‘Resolving Japan’s Territorial and Maritime Disputes with its Neighbors: Problems and Opportunities’ (2006) 57 Journal of Social Science of the International Christian University in Japan 197–249; Lee Seok Woo, The Resolution of the Territorial Dispute between Korea and Japan over the Liancourt Rocks (International Boundaries Research Unit, 2002); Lee and Lee, above n 49); Pilkyu Kim, Claims to Territory Between Japan and Korea in International Law (Bloomington, Xlibris, 2014); Lee and Lee, above n 9, 31–58 and 89–100. 56 See https://www.mofa.go.kr/ENG/policy/focus/dokdo/basic/index.jsp?menu=m_20_10_10&tab menu=t_1. 55 

96  Justice in the Historically Charged NEA

dispute, and that the matter should be resolved in the ICJ.57 The Korean stance can be considered as a strategic stance, and essentially a reinforcement of its perception of the strength of its claim. However, whereas there is no international system of compulsory adjudication, this on its own is not conclusive of the existence of a unilateral right of a State to characterise a dispute as a non-dispute, even if several States have taken this position with respect to different issues (mainly territorial) confronting them. The characterisation of a dispute as between States is a matter of International Law and a matter under the inherent jurisdiction of a judicial organ. States however may choose amongst different methods for resolving disputes, including whether or not to resolve it through negotiations; or judicial settlement (contra arbitration); conciliation, mediation, and fact-finding commission. And moreover with respect to the method of settlement their choices can be the subject of change. Second, the status of this territory as an island or a rock is material in terms of the Law of the Sea given that the maritime zones that they can potentially attract depend on their particular characterisation.58 Under Article 121 of UNCLOS ‘Rocks which cannot sustain human habitation or economic life of their own shall have no exclusive economic zone or continental shelf.’ In the Matter of the South China Sea Arbitration59 the tribunal provided extensive clarification on the interpretation of Article 121 of UNCLOS. In essence it interpreted Article 121 to equate an island with reference to its natural capacity to sustain human habitation (that is non-transient human habitation) or an economic life of its own (ie economic life focussed on the island and not solely on the maritime zone surrounding it). Accordingly, there is at the least a presumption, given the island’s physical conditions, that Dokdo is not an island but a rock and therefore it cannot have its own Continental Shelf or EEZ.60 Hitherto it seems however that Japan has argued for its status as that of an island.61 Both Korea and Japan claim title to Dokdo. Korea’s claim to title is mainly based on historical title and geographical proximity, Japan’s claim is on the basis of historical title and discovery of the terra nullius island. The duality in the basis of the Japanese claim is considered as undermining the Japanese claim, and estopping Japan from making a claim to Dokdo prior to 1905.62 Although just as title to territory in International Law is said to be relative as between States, it could arguably be equally relative over a period of time in so far as a State and the territory in question is concerned—this observation is equally valid in terms of Korea and Dokdo, as it is in terms of Japan and Dokdo. The historical claim is substantiated on both parts through various acts of engagement with the island.63 These acts of engagement (evidenced through 57 

See http://www.mofa.go.jp/a_o/na/takeshima/page1we_000065.html. See Art 121 of UNCLOS. 59  PCA Case No 2013-19 (12 July 2016) paras 204–553. 60  See also Kwon, above n 36, 84. 61  Van Dyke, above n 55, 196. 62  See for example ibid, 180. 63  These are documented variously. See for example Van Dyke, above n 55. 58 

The Law of the Sea and NEA Island Disputes 97

­ istorical records, maps, decrees and actual physical engagements) are the subject h of factual proof and evaluation; and call for judgement as to what weight should be given to them—including where on balance of the facts the totality of the sovereign engagements have been stronger. Briefly in a chronological order the historical facts are as follows. In 1905, the Japanese claimed that they occupied the island as it was terra nullius, annexing it into the Japanese Shimane Prefecture. In 1905 Korea was reduced to a protectorate of Japan64 and incorporated formally into Japan in 1910. Therefore, around this time Korea’s argument is that it was not in a position to protest at the Japanese claim. Moreover, it is claimed that the Japanese annexation was not made sufficiently publicly for outsiders to be able to notice it. The Korean perspective has been that the claim by Japan over Dokdo was in fact an integral part of its imperial conquests of the time. Thus, between 1905 and 1945 the whole of Korea was under Japanese control. After the Second World War, a series of international instruments emerged from the Allied Powers having a bearing on the disposition of Japanese acquired territories, including Korea. These included the Cairo D ­ eclaration 1943;65 the Potsdam Declaration 1945;66 SCAPIN No 677 January 1946;67 SCAPIN 1778;68 64  See Japan–Korea Treaty of 1904 in particular Art 1: ‘For the purpose of maintaining a permanent and solid friendship between Japan and Korea and firmly establishing peace in the Far East, the Imperial Government of Korea shall place full confidence in the Imperial Government of Japan, and adopt the advice of the latter in regard to improvements in administration.’. See also Agreement between Korea and Japan August 1904 Art 1; and the Japan-Korea Protectorate Treaty 1905 in particular Art 1: ‘… The Government of Japan, through the Ministry of Foreign Affairs in Tokyo, will hereafter have control and direction of the external relations and affairs of Korea, and the diplomatic and consular representatives of Japan will have charge of the subjects and interests of Korea in other countries.’ 65  The Declaration stated inter alia: ‘The three great Allies are fighting this war to restrain and punish the aggression of Japan. They covet no gain for themselves and have no thought of territorial expansion. It is their purpose that Japan, shall be stripped of all the islands in the Pacific which she has seized or occupied since the beginning of the first World War in 1914, and that all the territories Japan has stolen from the Chinese, such as Manchuria, Formosa, and the Pescadores, shall be restored to the Republic of China. Japan will also be expelled from all other territories which she has taken by violence and greed. The aforesaid three great powers, mindful of the enslavement of the people of Korea, are determined that in due course Korea shall become free and independent.’ 66  Art 8 of the Potsdam Declaration: ‘The terms of the Cairo Declaration shall be carried out and Japanese sovereignty shall be limited to the islands of Honshu, Hokkaido, Kyushu, Shikoku and such minor islands as we determine.’ 67  Supreme Commander for the Allied Powers Memorandum to Imperial Japanese Government 20 January 1946 SCAPIN 677: Art 3. ‘For the purpose of this directive, Japan is defined to include the four main islands of Japan (Hokkaido, Honshu, Kyushu and Shikoku) and the approximately 1,000 smaller adjacent islands, including the Tsushima Islands and the Ryukyu (Nansei) Islands north of 30° North Latitude (excluding Kuchinoshima Island); and excluding (a) Utsuryo (Ullung) Island, ­Liancourt Rocks (Take Island) and Quelpart (Saishu or Cheju) Island, (b) the Ryukyu (Nansei) Islands south of 30° North Latitude (including Kuchinoshima Island), the Izu, Nanpo, Bonin (Ogasawara) and Volcano (Kazan or Iwo) Island Groups, and all the other outlying Pacific Islands [including the Daito (Ohigashi or Oagari) Island Group, and Parece Vela (Okino-tori), Marcus (Minami-tori) and Ganges (Nakano-tori) Islands], and (c) the Kurile (Chishima) Islands, the Habomai (Hapomaze) Island Group (including Suisho, Yuri, Akiyuri, Shibotsu and Taraku Islands) and Shikotan Island.’ (Emphasis added). 68  SCAPIN 1778 (1947) Art 1: ‘The islands of Liancourt Rocks (or Take Shima), located 37° 15’ north, 131° 50’ east, are designated as a bombing range.’

98  Justice in the Historically Charged NEA

the Treaty of Peace with Japan signed in San Francisco 1951, against the background of exchanges as between Korea and the US;69 and finally the agreements between Korea and Japan normalising relations between them.70 These instruments, individually and cumulatively, have been interpreted by both sides as vindicating their respective claims. In 1952, Korea included Dokdo within the Syngman Rhee Line zone, a Presidential decree that proclaimed Korean sovereignty over the adjacent seas.71 This led to Japanese protests. There are a number of ways in which these facts can be considered. ­Moreover, much of the focus thus far has been essentially in terms of the paradigm of contemporary International Law on the acquisition of territories.72 This has provoked some critical evaluation of the International Law on the acquisition of ­territory73—positing the questions whether or not the western-centric international principles have a relevance to the special historical context of NEA; and whether there are existing regional norms that have a greater relevance to the challenges in the region. Furthermore, much of the International Law on acquisition of territory has developed through disputes involving former colonial powers, or between former colonies concerning territorial delimitations, rather than title to territory as between adjacent States.74 To conclude, Korean writers point to the existence of a weightier Korean historical title. This stance is also reinforced by some non-Korean pronouncements.75 69  Art 2 of the Peace Treaty in relevant part reads as follows: ‘Article 2 (a) Japan, recognizing the independence of Korea, renounces all right, title and claim to Korea, including the islands of Quelpart, Port Hamilton and Dagelet.’ See also Dean Rusk, then Assistant Secretary of State for Far Eastern affairs negative response to Korea’s request for the inclusion of Dokto to this list: ‘… the United States Government does not feel that the Treaty [the San Francisco Peace Treaty] should adopt the theory that Japan’s acceptance of the Potsdam Declaration on August 9, 1945 constituted a formal or final renunciation of sovereignty by Japan over the areas dealt with in the Declaration. As regards to the island of Dokdo, otherwise known as Takeshima or Liancourt Rocks, this normally uninhabited rock formation was according to our information never treated as part of Korea and, since about 1905, has been under the jurisdiction of the Oki Islands Branch Office of Shimane Prefecture of Japan. The island does not appear ever before to have been claimed by Korea.’ Source Japanese Foreign Ministry website. 70  See Agreement Between Japan and the Republic of Korea Concerning the Settlement of Problems in Regard to Property and Claims and Economic Cooperation in particular Art II: ‘1 The High Contracting Parties confirm that the problems concerning property, rights, and interests of the two High Contracting Parties and their peoples (including juridical persons) and the claims between the High Contracting Parties and between their peoples, including those stipulated in Article IV(a) of the Peace Treaty with Japan signed at the city of San Francisco on September 8, 1951, have been settled completely and finally.’ See also Treaty on Basic Relations between Japan and the Republic of Korea (1965). 71 The Presidential Proclamation of Sovereignty over Adjacent Seas, Republic of Korea. State ­Council Notice No 14 (18 January 1952). 72  See for Acquisition of territory standards works on International Law for example Shaw, above n 44, Ch 10. 73  See for example H Nasu and RD R Rothwell, ‘Re-Evaluating the role of international law in ­territorial and maritime disputes in East Asia’ (2014) 4(1) Asian Journal of International Law. 74  See Nasu and Rothwell, ibid at 66 and Kaiyan Kaikobad, ‘Problems of Contiguity, Natural Unity, and Ancient Original Title to Islands with Special Reference to Dokdo’ in Lee and Lee, above n 49, 174. See also Lee and Lee, above n 9, 241. 75  See Van Dyke, above n 55, 194; and Kaikobad, ibid, 169.

The Law of the Sea and NEA Island Disputes 99

This is fortified by an evaluation of the relationship between the undisputed Korean island of Ulleungdo with Dokdo. According to one writer the balance of the evidence shows that Ulleungdo and Dokdo have steadfastly been linked with each other over the centuries and on that basis the islands and their associated islands and insular and maritime features, all qualify as a group based on natural unity.76

There is a relative scarcity of Japanese academic focus in the English language on the problem.

B.  Senkaku/Diaoyu Islands Dispute77 between China and Japan The Senkaku78/Diaoyu79 islands are located in the East China Sea approximately halfway between the islands of Taiwan on the one hand and Yaeyama Retto (part of the Japanese Ryuku Islands) on the other; and comprise of some eight tiny islands of which the two largest have areas over 1km280 with the largest, viz Diaoyu/ Uotsuri Island, having an area of 3.5km2.81 The islands are uninhabited, and there is no economic activity taking place on them. This is attributed to the geographical isolation of the islands, and not the conditions on the islands which can sustain human habitation and economic activity.82 The islands are in the proximity of important shipping lanes, where there are rich fishing grounds and potential oil and gas reserves. Furthermore, the islands are strategically located, where the

76 

Kaikobad, ibid, 169. of Foreign Affairs, Japan: www.mofa.go.jp/region/asia-paci/senkaku/index.html; Chinese Foreign Ministry: www.fmprc.gov.cn/eng/wjb/zzjg/yzs/gjlb/2721/2722/t15974.shtml; Han-yi Shaw, ‘The Diaoyutai/Senkaku Islands Dispute: its History and an Analysis of the Ownership Claims of the P.R.C., R.O.C., and Japan ’ (1999) 3 Maryland Series in Contemporary Asian Studies; Steven Wei Su, ‘The Territorial Dispute over the Tiaoyu/Senkaku Islands: An Update’ (2005) 36 Ocean Development & International Law 45–61; Steven Wei Su, ‘The Tiaoyu Islands and their possible effect on the maritime boundary delimitation between China and Japan’ (2004) 385 Chinese Journal of International Law; TJ Schoenbaum, ‘Resolving Japan’s Territorial and Maritime Disputes with its Neighbors: Problems and Opportunities’ (2006) 57 Journal of Social Science of the International Christian University in Japan 197–249; Han-yi Shaw, ‘Resolving the Diaoyutai/Senkaku Islands Dispute: Examining Legal Claims and New Historical Evidence Under International Law and the Traditional East Asian World Order’ (2008) Chinese (Taiwan) Yearbook of International Law and Affairs; Carlos Ramos-Mrosovsky, ‘International Law’s Unhelpful Role in the Senkaku Islands’ (2008) 29 University of Pennslyvania Journal of International Law 903; Koichi Sato, ‘China’s Territorial Claims at Sea: The East China and South China Sea’ (2012) Eurasia Border Review 3 (1): 19–31, 3 (2): 71–90; Ryan M Scoville, ‘A Defense of Japanese Sovereignty Over the Senkaku/Diaoyu Islands’ (2013) 13(16) Marquette University Law School Legal Studies Research Paper; Tim F Liao, Kimie Hara and Krista Wiegand (eds), The China-Japan Border Dispute: Islands of Contention in Multidisciplinary Perspective (Farnham, Ashgate, 2015). 78  Japanese name. ‘The Senkaku Islands’ is the collective term that refers to a group of islands that includes Uotsuri, Kitakojima, Minamikojima, Kuba, Taisho, Okinokitaiwa, Okinominamiiwa and Tobise located at the west side of the Nansei Shoto Islands. They are part of Ishigaki City, Okinawa Prefecture. http://www.mofa.go.jp/a_o/c_m1/senkaku/page1we_000009.html. 79  Japanese name. 80  See for example Wei Su, ‘The Territorial Dispute’, above n 77. 81  See http://www.mofa.go.jp/a_o/c_m1/senkaku/page1we_000009.html. 82  See Lee and Lee,above n 9, 255. 77 Ministry

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US and China compete for military supremacy in the region.83 The islands are claimed by China, Taiwan and Japan. The islands are considered as having a particular importance in terms of the delineation of the maritime zones provided they are considered as islands—in particular the continental shelf margins as between China and Japan. As such not only the title to the island is important, so is the fact whether it is an island or a rock formation. The status of the island thus has to be considered against the background of the clarification provided in the South China Sea Arbitration referred to above. From the Chinese perspective it seems it would be difficult to presume that the Senkaku/Diaoyu can be considered islands under UNCLOS, on the basis of an incapacity to sustain human life and economic activity.84 However, according to Japan ‘Japanese citizens settled on the Islands and ran businesses such as dried bonito manufacture and bird feather collecting. During the peak, more than 200 Japanese lived on the Senkaku Islands.’85 This Japanese evaluation as an island is also confirmed by Korean writers.86 Thus, there are two perspectives as to likelihood of the islands generating a Continental Shelf and EEZ, and wherever the sovereignty lies of the islands, the maritime zones would be extensive. Be that as it may, in so far as maritime delimitations are concerned under current jurisprudence, whilst the presence of islands can have a bearing in the process of delineating opposite/adjacent maritime boundaries this need not be significant.87 In the same vein, proximity of an island to the mainland is not necessarily significant in terms of title to the island.88 At the end of the Second World War, under Article 2 of the San Francisco Treaty, Japan renounced ‘all right, title and claim to Formosa and the Pescadores.’ The Chinese claim is that these islands are an integral part of Taiwan. Furthermore, in the same agreement, Senkaku/Diaoyu were placed under US trusteeship, through reference to Nansei Shoto, an area incorporating the islands.89 The two China’s (Taiwan and the People’s Republic of China) did not object to the placing of the islands into the trusteeship of the US at the time. Neither however were parties to

83 

See for example http://www.bbc.com/news/world-asia-pacific-11341139. See for example Wei Su, ‘The Tiaoyu Islands’, above n 77, 401. 85  See http://www.mofa.go.jp/a_o/c_m1/senkaku/page1we_000009.html. 86  Lee and Lee, above n 9, 255. 87  ibid, 403 and 405. 88  Scoville, above n 77, 11. 89  See Art 3 of the San Francisco Treaty: ‘Japan will concur in any proposal of the United States to the United Nations to place under its trusteeship system, with the United States as the sole administering authority, Nansei Shoto south of 29 deg. north latitude (including the Ryukyu Islands and the Daito Islands), Nanpo Shoto south of Sofu Gan (including the Bonin Islands, Rosario Island and the Volcano Islands) and Parece Vela and Marcus Island. Pending the making of such a proposal and affirmative action thereon, the United States will have the right to exercise all and any powers of administration, legislation and jurisdiction over the territory and inhabitants of these islands, including their territorial waters.’ 84 

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this agreement. Moreover, Taiwan’s lack of objection is to be understood against the background of its 1954 mutual defence treaty with the US; under which it allowed US forces to be in and around its territory.90 Upon the end of the US trusteeship, the US returned the area to Japan, under the Okinawa Reversion Treaty.91 In addition, the treaty also extended protection to Japan of the area, under the Treaty of Mutual Cooperation and Security between the United States of America and Japan 1960.92 Japan claims to have control over the islands, and maintains that the islands are an integral part of Japan ‘in light of historical facts and based upon international law.’ It also maintains that there ‘exists no issue of territorial sovereignty to be resolved concerning the Senkaku Islands.’93 China has been demonstrating its concern over the Japanese claim since the 1970s94—post the UN Economic Commission for Asia and the Far East Report on the resources surrounding the islands.95 The first Chinese domestic legislation in which China’s claim is set out is Article 2 of its Territorial Sea and Contiguous Zone Act 1992.96 This claim is based on historical title, since its discovery by China in the fourteenth century; including territorial cession of the islands to Japan after China’s defeat in the Sino-Japanese War 1894–95 under the Treaty of Shimonoseki 189597 and its subsequent reversion by Japan to China under the San Francisco Peace Treaty 1951, wherein Formosa together with all its islands were returned

90  See Art VII of the Mutual Defense Treaty Between the United States and the Republic of China; December 2, 1954: ‘The Government of the Republic of China grants, and the Government of the United States of America accepts, the right to dispose such United States land, air and sea forces in and about Taiwan and the Pescadores as may be required for their defense, as determined by mutual agreement.’ 91  Agreement Between the United States of America and Japan Concerning the Ryukyu Islands and the Daito Islands Washington and Tokyo (simultaneously), 17th June 1971 (known as the Okinawa Reversion Agreement) Art I: ‘1. With respect to the Ryukyu Islands and the Daito Islands, as defined in paragraph 2 below, the United States of America relinquishes in favour of Japan all rights and interests under Article III of the Treaty of Peace with Japan signed at the City of San Francisco on September 8, 1951, effective as of the date of entry into force of this Agreements. Japan, as of such date, assumes full responsibility and authority for the exercise of all and any powers of administration, legislation and jurisdiction over the territory and inhabitants of the said islands. 2. For the purpose of this Agreement, the term “the Ryukyu Islands and the Daito Islands” means all the territories and their territorial waters with respect to which the right to exercise all and any powers of administration, legislation and jurisdiction was accorded to the United States of America under Article III of the Treaty of Peace with Japan other than those with respect to which such right has already been returned to Japan in accordance with the Agreement concerning the Amami Islands and the Agreement concerning Nanpo Shoto and Other Islands signed between the United States of America and Japan, respectively on December 24, 1953 and April 5, 1968.’ 92  Art II. 93 http://www.mofa.go.jp/region/asia-paci/senkaku/index.html. 94  Wei Su, ‘The Territorial Dispute’, above n 77, 45. 95  Scoville, above n 77, 13. 96  ibid, 23. 97  Art 2 of Treaty of Shimonoseki: ‘China cedes to Japan in perpetuity and full sovereignty the following territories, together with all fortifications, arsenals, and public property thereon:—(b) The island of Formosa, together with all islands appertaining or belonging to the said island of Formosa.’

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to China;98 and the 1952 Treaty of Peace Between Japan and China in which ‘all agreements before 1941 between China and Japan become null and void.99 On the other hand, Japan maintains that the Shimonoseki Treaty signed on 17 April 1895 did not result in the ceding of the islands to it—rather the islands were incorporated into Japan in January 1895, under the International Law of the time, after Japan ‘carefully ascertained that there had been no trace of control over the Senkaku Islands by another state prior to that period.’100 The Japanese claim thus seems to be based on prescription, viz peaceful and continuous occupation without Chinese objection.101 By the same token the Japanese claim can be interpreted as one of discovery, after ascertainment of the islands as being terra nullius before its annexation, followed by occupation.102 This situation could transpire if the original Chinese discovery of the islands in the fourteenth century was not accompanied by an effective occupation of the islands, to complete the process of acquisition through discovery. In either case, the relevant period during which the nature of the Japanese occupation that needs evaluation is 1895 to 1937 and 1951 to 1970—excluding 1937 to 1945 (period of the Second World War) and 1945–51 (post-War period of rearrangements).103 Under International Law the occupation has to be effective, but this effectivites as it is known, depends on the circumstances of each case, and therefore involves a certain measure of judgement as to what is appropriate in any given case.104 In sum, the nature of the islands; the nature of the occupation of both China and Japan of the islands; the conduct of China during the Japanese occupation and the US Trusteeship, call for careful evaluation and judgement in terms of weight to be given to the various factors involved in the application of the relevant principles of territorial acquisition viz acquisition by discovery and prescription; along with the principle of estoppel. Furthermore, there are questions here as to the kind of interpretation to be placed on the relevant provisions contained in the Treaty of Shimonoseki 1895; the San Francisco Peace Treaty 1951; and the 1952 Treaty of Peace Between Japan and China. In particular, what is the meaning of ‘island of Formosa, together with all islands appertaining or belonging to the said island of Formosa/’? Is it a reference to a physical or political relationship?105

98  Art 2 (b) Japan renounces all right, title and claim to Formosa and the Pescadores. See also Art 2 of Treaty of Peace between Japan and the Republic of China (Sino-Japanese Peace Treaty or Treaty of Taipei) (1952). 99 Art IV ibid ‘It is recognized that all treaties, conventions and agreements concluded before December 9, 1941, between Japan and China have become null and void as a consequence of the war.’ 100 http://www.mofa.go.jp/a_o/c_m1/senkaku/page1we_000010.html. 101  See Wei Su, ‘The Territorial Dispute’, above n 77, 49. 102  Scoville, above n 77, 15. 103  ibid, 19. 104  See for example Scoville, ibid at 19 and cases cited therein. 105  See Scoville, ibid; Ramos-Mrosovsky, above n 77, 928.

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Finally, the academic deliberations on the sovereignty of the islands is to be found in various sources encapsulating both the Chinese and Japanese perspectives respectively. This is also accompanied by some well-reasoned external analysis placing the sovereignty of the islands with Japan.106

III.  Human Rights and Comfort Women107 Discourse on the issue of Comfort Women has become an emotive issue in Korea, so much so that it has led to the dismissal in 2017 of a Professor from Sunchon National University in Korea for claiming that many of the Comfort Women ‘probably knew that they were going to sexually serve the Japanese soldiers and thus voluntarily left for Japan’;108 and the criminal prosecution of Professor Park Yu-ha from Sejong University, the author of Comfort Women of the Empire for claiming that ‘some Korean women who were taken to comfort stations overseas during World War II were volunteers, not victims who were forced to provide sexual services for Japanese soldiers against their will.’109 In this context it should be noted that the UN Human Rights Committee during the periodic review of Korea in November 2017 was concerned over the increasing use of criminal defamation laws ‘even when statements were true and made in the public interest.’110 In the same vein, it will be noted that the Special Rapporteur on the Promotion and Protection of the Right to Freedom of Opinion and Expression noted with respect to Japan that media outlets were reluctant to report on the Comfort Women issue;111 ‘harassment of Mr Takashi Uemura, one of the earliest Japanese journalists to report on the issue of “comfort women” in Korea when working for the newspaper

106 

See Scoville, ibid. Rhadika Coomaraswamy, Report of the Special Rapporteur on Violence against Women, its Causes and Consequences. UN Doc E/CN.4/1996/53/Add.1. (1996); Timothy Tree, ‘International Law: A Solution or a Hinderance towards Resolving the Asian Comfort Women Controversy’ (2000–01) UCLA Journal of International Law and Foreign Affairs 461–75; EK Yamamoto and Sara Lee. ‘Korean “Comfort Women” Redress Through the Lens of US Civil and Human Rights Reparatory justice and experiences’ (2012) II Journal of Korean Law 123–49; Koji Teraya, ‘A Consideration of the so-called Comfort Women Problem in Japan-Korea Relations: Embracing the Difficulties in the International Legal and Policy Debate’ (2013) 6(1) Journal of East Asia & International Law 195–220; Seong Phil Hong, ‘Remedying “Enforced Sexual Slavery”: Validating Victims’ Reparation Claims against Japan’ (2013) 6(1) Journal of East Asia & International Law 175; Lee Jang-Hie. ‘Compensation of victims of Japanese forced labor during colonial rule and its international legal arguments and tasks’ (2013) 1 Korean Yearbook of International Law; Lee and Lee, above n 9, 75–82, 88–89 and 117–50. 108 See Korea Times (10 December 2017) http://www.koreatimes.co.kr/www/nation/2017/10/ 251_237547.html. 109  Korea Times (11 December 2017). 110  See para 33 of the Report of the Office of the United Nations High Commissioner for Human Rights (August 2017) UN A/HRC/WG.6/28/KOR/2 https://documents-dds-ny.un.org/doc/UNDOC/ GEN/G17/255/70/PDF/G1725570.pdf?OpenElement. 111  See Report of the Special Rapporteur on the promotion and protection of the right to freedom of opinion and expression on his mission to Japan (May 2017) UN A/HRC/35/22/Add.1 para 28. 107 

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Asahi Shinbun’;112 inadequate references in textbooks about Comfort Women,113 including in one case a disclaimer ‘that there was no “forcible” taking of women.’114 In sum, discourse on the Comfort Women issue has to be candid, objective and not the hand-maiden for political gains of national politicians—particularly if the full scope of legal responsibility is to be established. A legal perspective of the issue involves asking difficult and candid questions. Generally it should be noted that the UN Human Rights Council, in the Twenty-eighth Session 2017, made in the Universal Periodical Review of Korea 218 recommendations, of which Korea accepted 85, whereas the 130 or so others are under consideration with Korea.115 In the case of Japan the UN Human Rights Council also made 218 recommendations all of which are under consideration with Japan.116 In October 2013, the UN Human Rights Council in its Twenty-fifth session of the periodic review of China, made 252 recommendations.117 The issue of ‘Comfort Women’, euphemistically referred to as such, has been described as the practice of ‘military sexual slavery’ during wartime.118 This practice was institutionalised by the Japanese within its army as far back as 1932, during hostilities between Japan and China. It continued during the S­ econd World War; and followed Japanese military engagements in Korea, China, T ­ aiwan, ­Borneo, the ­Philippines, Pacific Islands, Singapore, Malaysia, Burma and I­ ndonesia. Various Comfort Women stations were established by the Japanese in these ­places— according to Japan to serve Japanese soldiers, to prevent rape of civilians during times of armed conflict and to avert espionage. Some estimates of the number of women involved are around 200,000 women—from Korea, China and the ­Philippines— 80 per cent of whom were from Korea (both North and South).119 This Japanese practice of military sexual slavery has been the subject of two reports, viz the Report by Special UN Rapporteur Coomaraswamy, Rhadika in 1996 (hereinafter referred to as the Rhadika Report);120 and again in 1998 the Report by Special UN R ­ apporteur Gay J McDougall (the McDougall Report).121 It should be noted here that these reports do not constitute judicial pronouncements although they c­ ertainly carry weight. In subsequent periodic reviews under the UN Human 112 

ibid, para 30 ibid, para 37. ibid, para 39. 115  See Korea 9th November Universal Periodical Review 2017 http://webtv.un.org/watch/republicof-korea-upr-adoption-28th-session-of-universal-periodic-review-/5645996703001/?term=&lan= russian. 116 http://webtv.un.org/meetings-events/watch/japan-upr-adoption-28th-session-of-universalperiodic-review/5648383981001/?term. 117 UN A/HRC/25/5 https://documents-dds-ny.un.org/doc/UNDOC/GEN/G13/188/55/PDF/ G1318855.pdf?OpenElement. 118  Coomaraswamy, above n 107, para 6. 119 ibid, para 61 and Korean Constitutional Court Case 2006 Heonma 788 Decision, issued August 30, 2011. 120 ibid. 121  Final report submitted by Ms Gay J McDougall, Special Rapporteur Systematic rape, sexual slavery and slavery-like practices during armed conflict (E/CN.4/Sub.2/1998/13 22 June 1998). 113  114 

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Rights Commission various countries including Korea have called upon Japan to accept its legal responsibility towards the Comfort Women and accordingly offer redress.122 Some of the factual123 and legal findings of the Rhadika Report and McDougall Report are not accepted by the Japanese.124 Japan however has accepted a moral responsibility for its acts affecting Comfort Women. This J­ apanese recognition of its involvement came in 1993 through an official J­ apanese study on the issue.125 The Japanese practice of military sexual slavery came into public light only when the victim survivors began to speak of their experiences in 1991, upon the establishment of the Korean Council for Women Drafted for Military Sexual Slavery by Japan. The recruitment of the women involved coercion and deception by agents or collaborators of the Japanese army.126 Whilst the Japanese army had a framework for the management of the Comfort Stations with respect to such matters as hours of service, pay, hygiene etc, in actual fact the conditions for the women were extremely hard, and included servicing 60/70 men per day under compulsion. Many of the women were killed by the Japanese upon the end of the war.127 The demands of the Comfort Women generally involve the following: (1) individual apology by the Japanese government; (2) apology to the State; (3) recognition of the crimes committed viz crimes against humanity; gross violations of international humanitarian law; crimes against peace; and the crime of slavery, trafficking in persons and of forced prostitution; (4) payment of compensation; (5) open and transparent investigation in Japan on the institution of Comfort Stations in the Japanese army; (6) amendment of Japanese history books; (7) identification and prosecution of Japanese involved.128 In 1993 Korea enacted a Living Support Act providing for free medical care, along with living expenses for former Comfort Women.129 In 1995, the Japanese established the Asian Peace and Friendship Fund for Women130—a joint

122 

See 2008 and 2012 UN Human Rights Council Periodic Reviews of Japan. example, statement of Prime Minister Shinzo Abe 6 October 2006 referred to in Teraya, above n 107, 197. 124  See for example Teraya, ibid and the summary of Japanese defences set out in the McDougall Report, above n 121, Appendix. 125  See Appendix to the McDougall Report, above n 121, titled ‘An Analysis of the Legal Liability of the Government of Japan for ‘Comfort Women Station’ Established During the Second World War’ para 2. 126  Coomaraswamy, above n 107, para 14. 127  ibid, paras 19, 33, 34, 59. 128  ibid, para 61. 129  ibid, para 80. Act on Livelihood Stability for Sexual Slavery Victims Drafted for the Japanese Imperial Army under Japanese Colonial Rule (Law No 4565) 1993. 130  The objectives for the setting up of the Fund are stated as follows in a Statement by the Chief Cabinet Secretary (14 June 1995): ‘To follow up the statement made in August, 1994, by Prime Minister Tomiichi Murayama, and in accordance with discussions of the Ruling Parties’ Project Team for 50th Anniversary Issues, and after consideration within the Government, based on our remorse for the 123  For

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­ ublic-private enterprise. This Fund was set up by the Japanese in recognition p of a moral responsibility towards the Comfort Women (contra legal). This Fund was seen in Korea, and noted in the Rhadika Report, as not contributing to the recognition of and discharge of the legal responsibility of the Japanese government towards the Comfort Women claims.131 The Korean government therefore was not keen on it, and so on condition that the victims did not claim from the Asian Fund, distributed a lump sum of KRW 43,000,000 to each of the victims.132 The Asian Fund is now dissolved with some 364 victims having received benefits from it.133 Along with the Asian Fund, the Japanese Prime Minister in 1998 made a public apology in a letter addressed to the Netherlands Prime Minister.134 past on the occasion of the 50th anniversary of the end of the War, the projects of the “Asian Peace and Friendship Foundation for Women” will be undertaken as follows. The following activities will be conducted for the former wartime comfort women, through the cooperation of the Japanese People and the Government: The Foundation will raise funds in the private sector as a means to enact the Japanese people’s atonement for former wartime comfort women. The Foundation will support those conducting medical and welfare projects and other similar projects which are of service to former wartime comfort women, through the use of government funding and other funds. When these projects are implemented, the Government will express the nation’s feelings of sincere remorse and apology to the former wartime comfort women. In addition, the Government will collate historical documents on past wartime comfort women, to serve as a lesson of history. As its project addressing issues related to the honor and dignity of women, including the projects mentioned in 1 (ii) above, the Foundation will, through the use of government funding and other funds, support those who undertake projects that address contemporary problems, such as violence against women.’ See http://www.mofa.go.jp/policy/women/fund/state9506.html. 131 

Coomaraswamy, above n 107, paras 131–34. See Korean Constitutional Court Case 2006 Heonma 788 Decision, issued August 30, 2011. 133  See Teraya, above n 107, 209. 134  The contents of the letter of the then Japanese Prime Minister Ryutaro Hashimoto sent to the Netherlands Prime Minister Willem Kok on 15 July 1998: ‘The Government of Japan, painfully aware of its moral responsibility concerning the issue of so called “wartime comfort women,” has been sincerely addressing this issue in close cooperation with the Asian Women’s Fund which implements the projects to express the national atonement on this issue. Recognizing that the issue of comfort women, with an involvement of the Japanese military authorities at that time, was a grave affront to the honor and dignity of large numbers of women, I would like to convey to Your Excellency my most sincere apologies and remorse to all the women who underwent immeasurable and painful experiences and suffered incurable physical and psychological wounds as comfort women. After a series of talks among the parties concerned to crystallize such feelings of the Japanese people, an agreement has been reached that the Asian Women’s Fund will provide financial assistance for the newly established Project Implementation Committee in the Netherlands which will implement the Project to provide goods and/or services in the medical and welfare fields for those who experienced the difficulties during the war concerning the comfort women issue. I will be grateful if the Government of the Netherlands provides warm understanding and support to this Project of the Asian Women’s Fund which embodies the sincere feelings of the Japanese people. By the Statement of Prime Minister in 1995, the Government of Japan renewed the feelings of deep remorse and the heartfelt apology for tremendous damage and suffering caused by Japan to the people of many countries including the Netherlands during a certain period in the past. My cabinet has not modified this position at all, and I myself laid a wreath to the Indisch Monument with these feelings on the occasion of my visit to the Netherlands in June last year. 132 

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Prior to this response, according to Japan, in any event all legal issues arising from Japanese occupation were dealt with in the Agreement on the Settlement of Problems concerning Property and Claims and on Economic Co-operation between Japan and the Republic of Korea 1965135 (herein after referred to as the 1965 Agreement) Article II (1) of which states: 1. The High Contracting Parties confirm that the problems concerning property, rights, and interests of the two High Contracting Parties and their peoples (including juridical persons) and the claims between the High Contracting Parties and between their peoples, including those stipulated in Article IV(a) of the Peace Treaty with Japan signed at the city of San Francisco on September 8, 1951, have been settled completely and finally.

Similar waivers in the San Francisco Peace Treaty of 1951, in the 1972 Joint Chinese/Japanese Communiqué 1972, and the 1965 Agreement between Korea and Japan have been considered as ineffective in extinguishing Japanese liability on the basis the waivers do not cover personal damages;136 the context of the agreement, for example the 1965 Agreement is with reference to economic concerns alone; lack of disclosure at the material times on the part of Japan of its involvement in the apparatus of the Comfort Women Stations; and intent on the part of the parties to these waivers ‘to foreclose claims for compensation by individuals for harms committed by the Japanese military in violation of human rights or humanitarian law.’137 The Japanese perspective however is that it releases Japan of all responsibilities towards the Comfort Women based on a reading of the text, and some evidence in the negotiating background of the agreement.138 It is noted that this issue really surfaced in public post-1965.

In view of further promoting mutual understanding between our two countries, the Government of Japan is extending, support for historical research, and expanding exchanges, as two pillars, under the Peace, Friendship and Exchange Initiative which has a purpose to build a relationship toward the future between Japan and neighboring countries. We must not evade the weight of the past, nor should we evade our responsibilities for the future. Japan, facing up squarely to its past history and accurately conveying it to future generations, is determined to do its utmost to further promote the friendly relationship with the Netherlands which will celebrate the 400th anniversary in the year 2000.’ http://www.mofa.go.jp/policy/women/fund/ project0107-3.html. 135  With respect to Comfort Women victims of non-Korean nationality the Japan relies on Art 14 (b) of the San Francisco Peace Treaty 1951 which states: ‘Except as otherwise provided in the present Treaty, the Allied Powers waive all reparations claims of the Allied Powers, other claims of the Allied Powers and their nationals arising out of any actions taken by Japan and its nationals in the course of the prosecution of the war, and claims of the Allied Powers for direct military costs of occupation.’ However, People’s Republic of China was not a party to this treaty. The operative provision with respect to China is concerned is contained in para 5 of Joint Communique of the Government of Japan and the Government of the People’s Republic of China 1972: ‘The Government of the People’s Republic of China declares that in the interest of the friendship between the Chinese and the Japanese peoples, it renounces its demand for war reparation from Japan.’ 136  Coomaraswamy, above n 107, para 78. 137  See McDougall Report, above n 121, Appendix para 58. 138  See for example Teraya, above n 107, 202.

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Of note here, although in a slightly different context, is the decision of the Korean Constitutional Court of 2011, relating to the 1965 Agreement, upon a claim brought by victim Comfort Women.139 In brief, the Korean Constitutional Court held that given the differences in interpretation of Article 2 on the question whether the Comfort Women claim is covered under the Agreement, the Korean government had an obligation to resolve this dispute through the arbitral mechanism set out in Article 3 of the Agreement. This duty to act was set out in the Korean Constitution,140 which in the case of fundamental rights of Korean citizens affected by the actions of Japan placed an obligation on the State to pursue redress at the international level. Moreover, the provision for the welfare of the Comfort Women provided by the Korean State did not affect this duty. Is there also a duty to pave the way within Korea for criminal prosecutions to be brought against known Japanese perpetrators of Comfort Women atrocities? Is there more scope within Korea to pursue vigorously Korean collaborators in this enterprise? Thus far it is understood that there have been no prosecutions of Japanese citizens in Korea responsible for having committed the international crimes against Comfort Women; and it is not clear whether the exercise of criminal jurisdiction under the universal jurisdiction that International Law allows for is a possibility under Korean law, without further enabling legislation. Finally, to complete the picture, it will be noted that in 1991 some Comfort Women filed a case in Japan. This case ultimately had to be considered by the Supreme Court of Japan—which ruled against the victims. In the lower court, the decision was made against the petitioners, on the basis of Article 2.3 of the 1965 Agreement.141 On the other hand there has been successful prosecution in the Netherlands.142 Based on the evidence provided by Japan, both the Rhadika and McDougall Reports attribute responsibility to the Japanese State, through its acts/omissions with respect to the atrocities committed to the Comfort Women. This ­responsibility

139  Constitutionality of Nonfeasance under Article 3 of the Agreement between the Republic of Korea and Japan Concerning the Settlement of Problems in Regard to Property and Claims and Economic Cooperation (2006 Heonma 788 Decision, issued August 30, 2011 (Const Ct) set out in Lee and Lee, above n 9, 117. 140  Art 2 of the Korean Constitution: Art 2 (2) ‘It shall be the duty of the State to protect citizens residing abroad as prescribed by Act.’ And Art 10 of the Korean Constitution: ‘All citizens shall be assured of human worth and dignity and have the right to pursue happiness. It shall be the duty of the State to confirm and guarantee the fundamental and inviolable human rights of individuals.’ 141  Art 2 (3) of the 1965 Agreement: ‘ As a condition to comply with the provisions of paragraph 2 above, no claims shall be made with respect to the measures relating to the property, rights, and interests of either High Contracting Party and its people which were brought under the control of the other High Contracting Party on the date of the signing of the present Agreement, or to all the claims of either High Contracting Party and its people arising from the causes which occurred prior to that date.’ 142  See McDougall Report, above n 121, para 62: ‘Following the Second World War, a Netherlands court in Batavia found Japanese military defendants who had participated in enslaving 35 Dutch women and girls in “comfort stations” during the Second World War guilty of war crimes for acts including rape, coercion to prostitution, abduction of women and girls for forced prostitution, and ill-treatment of prisoners.’

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arises in particular with respect to the following important international crimes under Customary International Law, existing at the time the atrocities were committed, and/or as a result of Japan being a party to certain international agreements existing at the relevant time,143 viz prohibition on slavery, rape as a war crime and crimes against humanity.144 In addition to reliance on the 1965 Agreement, Japan has proffered a number of defences to the legal charges principally as follows: (a) that recent developments or advances in international criminal law may not be applied retroactively; (b) that the crime of slavery does not accurately describe the system established through the ‘comfort stations’, and that the prohibition against slavery was not, in any event, established as a customary norm under applicable International Law at the time of the Second World War; (c) that acts of rape in armed conflict were not prohibited by either the Regulations annexed to the Hague Convention No. IV of 1907, or by applicable customary norms of International Law in force at the time of the Second World War; and (d) that the laws of war would only apply, in any event, to conduct committed by the Japanese military against nationals of a belligerent State, and would not, therefore, cover the actions of the Japanese military with respect to Japanese or Korean nationals, since Korea was annexed to Japan during the Second World War.145

All of these have been refuted in the McDougall Report, in particular on the basis that the charges are set under the Customary International Law of the time, and that these are relevant, regardless of whether the enslaved were nationals or not. Finally, in December 2015 Korea under the Park Geun-hye administration, entered with Japan into an ‘agreement’ with respect to the Comfort Women issue. This agreement purported to be ‘final and irreversible’ and does not arguably, on one interpretation, contain an explicit admission of legal culpability for the international crimes committed. The agreement does not seem to be widely available in the public domain; contained some secret elements;146 and does not appear to be registered as an agreement under Article 102 of the UN Charter.147 However, the outcome of the discussions between the two countries on the issue is set out on the Japanese website, with statements by the two respective Foreign Ministers upon the conclusion of the discussions.148 The legal nature of the 2015 understanding 143  Importantly the 1921 International Convention for the Suppression of the Traffic in Women and Children. 144  McDougall Report, above n 121, Appendix. 145  See ibid, Appendix para 4. 146 See Korea Times (27 December 2017) http://www.koreatimes.co.kr/www/nation/2017/12/ 120_241562.html. 147  See for registered agreements https://treaties.un.org/pages/FileSearch.aspx?tab=CI. 148  The understanding of the two countries of the discussion on Comfort Women is set out as follows: 1. Foreign Minister Kishida: ‘The Government of Japan and the Government of the Republic of Korea (ROK) have intensively discussed the issue of comfort women between Japan and the ROK at bilateral meetings including the Director-General consultations. Based on the result of such discussions, I, on behalf of the Government of Japan, state the following:

(1) The issue of comfort women, with an involvement of the Japanese military authorities at that time, was a grave affront to the honor and dignity of large numbers of women, and

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has all the hallmarks of an international agreement considered in terms of the elements necessary under the Law of Treaties for there to be an agreement, viz consensus ad idum, capacity and intention to create legal relations. The 2015 agreement was not well received in Korea. It was not well ­considered either by some in the latest 2017 periodic review of Korea under the auspices of the United Nations Human Rights Council (UNHRC).149 It was observed therein that the agreement ‘did not meet standards of State accountability for gross human rights violations and had been reached without a proper consultation process.’ This perspective observed in the UNHRC is shared by the new Moon Jae-in administration which decided in 2017 to set up a Task Force to examine the 2015 agreement. Whilst the Task Force found serious flaws in the agreement the Moon Jae-in administration has reluctantly decided not to re-negotiate the

the Government of Japan is painfully aware of responsibilities from this perspective. As Prime Minister of Japan, Prime Minister Abe expresses anew his most sincere apologies and remorse to all the women who underwent immeasurable and painful experiences and suffered incurable physical and psychological wounds as comfort women. (2) The Government of Japan has been sincerely dealing with this issue. Building on such experience, the Government of Japan will now take measures to heal psychological wounds of all former comfort women through its budget. To be more specific, it has been decided that the Government of the ROK establish a foundation for the purpose of providing support for the former comfort women, that its funds be contributed by the Government of Japan as a one-time contribution through its budget, and that projects for recovering the honor and dignity and healing the psychological wounds of all former comfort women be carried out under the cooperation between the Government of Japan and the Government of the ROK. (3) While stating the above, the Government of Japan confirms that this issue is resolved finally and irreversibly with this announcement, on the premise that the Government will steadily implement the measures specified in (2) above. In addition, together with the Government of the ROK, the Government of Japan will refrain from accusing or criticizing each other regarding this issue in the international community, including at the United Nations.’ 2. Foreign Minister Yun: ‘The Government of the Republic of Korea (ROK) and the Government of Japan have intensively discussed the issue of comfort women between the ROK and Japan at bilateral meetings including the Director-General consultations. Based on the result of such discussions, I, on behalf of the Government of the ROK, state the following: (1) The Government of the ROK values the GOJ’s announcement and efforts made by the Government of Japan in the lead-up to the issuance of the announcement and confirms, together with the GOJ, that the issue is resolved finally and irreversibly with this announcement, on the premise that the Government of Japan will steadily implement the measures specified in 1. (2) above. The Government of the ROK will cooperate in the implementation of the Government of Japan’s measures. (2) The Government of the ROK acknowledges the fact that the Government of Japan is concerned about the statue built in front of the Embassy of Japan in Seoul from the viewpoint of preventing any disturbance of the peace of the mission or impairment of its dignity, and will strive to solve this issue in an appropriate manner through taking measures such as consulting with related organizations about possible ways of addressing this issue. (3) The Government of the ROK, together with the Government of Japan, will refrain from accusing or criticizing each other regarding this issue in the international community, including at the United Nations, on the premise that the Government of Japan will steadily implement the measures it announced.’ 149 

See UN A/HRC/WG.6/28/KOR/2 para 42.

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2015 agreement, accepting it as an agreement entered into by the two countries.150 However, following the decision not to re-negotiate President Moon Jae-in has asked for a sincere apology by Japan to the victims adding: Basically, I believe the issue can be addressed only by the truth and justice. When Japan acknowledges the truth, makes a sincere apology to the victims, and, learning lessons from it, makes efforts with international society not to repeat such behavior, then the victims will forgive Japan and that will resolve the issue completely.151

There is still therefore continued rancour in Korea—at any rate concern from the victim’s perspective. Indeed, the stance appears as a repudiation of the agreement.

IV.  Denuclearisation in the Korean Peninsula There has been much ado about denuclearisation in the Korean peninsula at the political level, particularly since the Trump administration in the US and its determination to denuclearise the Korean peninsula, and in particular to halt the efforts of North Korea to empower itself fully as a nuclear State. There has also been a reasonable amount of focus in academic discourse from a legal perspective.152 In Korea however the discussion on the issue may be set against the background of the National Security Law passed in 1948 and under the shadows of US nuclear policy. The National Security Act has been used to criminalise so called ‘“anti-state” activities such as praising North Korea or questioning South Korea’s stance on issues related to North Korea.’153 However, it should be stressed that the legislation

150 

See for example Korea Times (9 January 2018). Korea Times (10 January 2018). 152  See for example M Asada, ‘Nuclear Weapons and International Law Part 1 and Part 2’. UN Audiovisual: http://legal.un.org/avl/ls/Asada_ACD_video_1.html and http://legal.un.org/avl/ls/Asada_ ACD_video_2.html; Chinese; Japanese and Korean foreign Ministry websites; E Y Joong Lee, ‘Can the SC Resolution 2270 Stop North Korea’s Nuclear Dilemma? From the Geneva Agreed Framework to the Washington Communiqué’ (2016) 9(1) Journal of East Asia & International Law 262–77; E Y Joong Lee, ‘The complete denuclearization of the Korean Peninsula: Some considerations under International Law’ (2010) Chinese Journal of International Law; Benjamin Habib, ‘The enforcement problem in Resolution 2094 and the United Nations Security Council sanctions regime: sanctioning North Korea’ (2016) 70(1) Australian Journal of International Affairs; Masahiko Asada, ‘Arms control law in crisis? A study of the North Korean Nuclear Issue’ (2004) Journal of Conflict & Security Law; P Hayes and M Hamel-Green, ‘The path not taken, the way still open: Denuclearizing the Korean peninsula and Northeast Asia’, Austral Special Report 09-09S RMIT University (2009); Dan Ernst, ‘Questioning the legality and legitimacy of a preventative strike by the US to disarm North Korea of Nuclear Weapons’ in B Howe and B Kondoch, The legality & legitimacy of the use of force in Northeast Asia (Leiden, Brill, 2013) ch 8; J Clegg, ‘Korean Denuclearization: A test for China’s Cooperative Security Strategy’ in R Amer and K Zou, Conflict management & dispute Settlement in East Asia (Farnham, Ashgate, 2011) ch 7. 153 See for example reporting of the Shin Eun-mi deportation: Elise Hu, ‘The North Korean Threat Keeps a Cold-war era Security Law Around’ (11 April 2016), https://www.npr.org/sections/­ 151 See

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in question has been watered down since its enactment.154 Nevertheless according to a recent Amnesty International Report: ‘The authorities continued to use the vaguely worded National Security Law to intimidate and imprison people exercising their right to freedom of expression.’155 Denuclearisation of the North Korean peninsula is not a modern-day desideratum decoupled with the region’s historical past. It is very much part of the legacy of the post-war division of Korea imposed as a consequence of the defeat of Japan and the resulting superimposed geopolitical/ideological imprint on the region. As such denuclearisation of the Korean peninsula touches on the survival of North Korea, peace as between North and South, and the ordering of relations of both North and South with Japan and China respectively. Indeed, it is also concerned with associated historical issues including territorial/maritime and human rights concerns. Moreover, the interests of certain major powers, in particular the US and China/Russia, are also implicated. On the surface, however, the project of denuclearising the Korean peninsula is rooted in an alleged serious breach of a norm of the ‘International Law on Nuclear Armament and Safety’ by North Korea; and constituting a threat to international peace and security. Consequently, the matter has been within the domain of the UN Security Council. The project of denuclearisation, particularly in a region underpinned by deep-rooted conflicts, is to some extent of course in the domain of international relations. International Law however can offer consensual management within the existing, although not necessarily ideal, framework of the International Law on Nuclear Armament and Safety. International Law can act as a coercive force through the UN Security Council in shaping the nuclear disarmament process, where there is a threat to the international peace and security. International Law can also through the Law on Armed Conflict shed light on the circumstances wherein nuclear arms can actually be availed. In sum, from a legal perspective there are three spheres of relevance, viz the framework of the International Law on Nuclear Armament and Safety, the coercive and political apparatus of the UN Security Council, and finally the law on armed conflict.

parallels/2016/04/11/473760643/the-north-korea-threat-keeps-a-cold-war-era-security-law-around; and http://www.koreatimesus.com/tag/shin-eun-mi/. It is understood that had Shin Eun-mithis matter gone on to judicial deliberation the outcome would have been different. 154  Thus Art 1 of the Act now reads since 1991: ‘Article 1 (1) The purpose of this Act is to secure the security of the State and the subsistence and freedom of nationals, by regulating any anticipated activities compromising the safety of the State. (2) In the construction and application of this Act, it shall be limited at a minimum of construction and application for attaining the purpose as referred to in paragraph (1), and shall not be permitted to construe extensively this Act, or to restrict unreasonably the fundamental human rights of citizens guaranteed by the Constitution. (Amendment through Act No 4373, May 31, 1991)’. 155  See Amnesty International Report 2016–17,. https://www.amnesty.org/download/Documents/ POL1048002017ENGLISH.PDF. See also UNHRC A/HRC/WG.6/28/KOR/3 (2017).

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On the Law on Armed Conflict the principal point of note here is that the law as it exists now does not necessarily exclude the possibility of the use of nuclear weapons. Thus, the ICJ has famously stated: [T]he threat or use of nuclear weapons would generally be contrary to the rules of international law applicable in armed conflict, and in particular the principles and rules of humanitarian law; However, in view of the current state of international law, and of the elements of fact at its disposal, the Court cannot conclude definitively whether the threat or use of nuclear weapons would be lawful or unlawful in an extreme circumstance of self-defence, in which the very survival of a State would be at stake …156

Both the US157 and North Korea158 in 2017 seemed to have been, at any rate in terms of their public rhetoric, in an existentialist discourse, with respect to the use of nuclear weapons. The framework of the International Law on Nuclear Armament and Safety briefly as it exists currently is as follows. The law is set in various international agreements—the principal being however the Treaty on the Non-Proliferation of Nuclear Weapons (NPT) and the normative framework under the International Atomic Energy Agency (IAEA). With respect to the NPT Japan and South Korea are non-nuclear State parties, whereas China along with the US and Russia are nuclear-weapon State parties. China, Korea, Japan, US and Russia are all members of the IAEA. The NPT differentiates in terms of its obligations as between a nuclear-weapon State ie, ‘one which has manufactured and exploded a nuclear weapon or other nuclear explosive device prior to 1 January 1967’;159 and a ‘nonnuclear-weapon State.’ Basically, the obligations of a non-nuclear-weapon State prohibit the manufacture/acquisition of nuclear weapons; whereas the obligations of the nuclear-weapon State prevent the spreading of nuclear weapons. Moreover, under Article 3 of the NPT, a non-nuclear-weapon State is required to enter into a safeguards agreement with the IAEA in order to ensure ‘verification of the fulfilment of its obligations assumed under’ the NPT ‘with a view to preventing diversion of nuclear energy from peaceful uses to nuclear weapons or other nuclear

156 

Legality of the Threat or Use of Nuclear Weapons ICJ: Advisory Opinion of 8 July 1996. See President Trump’s statement at UN General Assembly on 19 September 2017: ‘The United States has great strength and patience, but if it is forced to defend itself or its allies, we will have no choice but to totally destroy North Korea.’ 158  See Statement by HE Mr Ri Yong Ho, Minister for Foreign Affairs North Korea at the United Nations General Assembly New York 23rd September 2017: ‘Unless true international justice is ­realized, the only valid philosophical principle is that force must be dealt with force and nuclear weapons of tyranny must be dealt with nuclear hammer of justice. The possession of nuclear deterrence by the DPRK is a righteous self-defensive measure taken as an ultimate option, pursuant to this principle.’ 159  See Art IX (3) of the NPT. 157 

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explosive devices.’ Finally, a party to the NPT can withdraw from the agreement upon a three months’ notice under a prescribed procedure.160 North Korea acceded to the NPT in December 1985. In January 1992 North Korea signed a Safeguards Agreement with the IAEA. On 12 March 1993 North Korea sent its withdrawal notice withdrawing from the NPT.161 Shortly after on the 11 June 1993 it suspended its withdrawal one day before three months, when its withdrawal would have become effective, having been persuaded to remain.162 In June 1994 it withdrew from the IAEA, of which it had been a member since 1974. On 10 January 2003 however, it activated its notification of withdrawal, and therefore its withdrawal took effect on the 11 January 2003.163 These occasions have been set against a backdrop of efforts on the part of North Korea to manufacture nuclear weapons; international condemnation at the behest of the IAEA and the UN Security Council (SC) and others of North Korean actions; along with efforts to address North Korea’s security and energy concerns. These series of events have raised mainly two important and related legal questions viz whether North Korea’s withdrawal from the NPT was in conformity with its provisions; and whether its obligations under the Safeguards Agreement with the IAEA continued upon its withdrawal from the NPT. In 2002, the IAEA adopted a resolution holding North Korea in violation of its Safeguards Agreements with the IAEA.164 In 2006 the UNSC decided that Korea conformed to the NPT and its Safeguard Agreement.165 It should be noted here that Article 26 of the Safeguard Agreement specifically states that it is to ‘remain in force as long as’ North Korea is a party to the NPT. With respect to the status of North Korea in the NPT there has been some scepticism as to whether the North Korean ‘withdrawal’ is in conformity with Article X

160  See Art X of the NPT which states: ‘1. Each Party shall in exercising its national sovereignty have the right to withdraw from the Treaty if it decides that extraordinary events, related to the subject matter of this Treaty, have jeopardized the supreme interests of its country. It shall give notice of such withdrawal to all other Parties to the Treaty and to the United Nations Security Council three months in advance. Such notice shall include a statement of the extraordinary events it regards as having jeopardized its supreme interests.’ See also Asada, ‘Arms control law in crisis’, above n 152, 332. 161  See North Korean withdrawal notice: http://caledavis.com/Sources/1993/DPRKWithdrawal.pdf. 162  See Joint Statement of the Democratic People’s Republic of Korea and the United States of America, New York, 11 June 1993 wherein North Korea stated that it has ‘decided unilaterally to suspend as long as it considers necessary the effectuation of its withdrawal from the (NPT).’ 163  See North Korean final NPT withdrawal notice: http://caledavis.com/Sources/2003/FinalNPTWithdrawal.pdf. 164  See for example Asada, ‘Arms control law in crisis’, above n 152, 340 and Report of the Director General of the IAEA to UN SC and GA A/48/133/S/25556 http://undocs.org/A/48/133. 165  S/RES/1718 (2006): ‘Decides that the DPRK shall abandon all nuclear weapons and existing nuclear programmes in a complete, verifiable and irreversible manner, shall act strictly in accordance with the obligations applicable to parties under the Treaty on the Non-Proliferation of Nuclear Weapons and the terms and conditions of its International Atomic Energy Agency (IAEA) Safeguards Agreement (IAEA INFCIRC/403) and shall provide the IAEA transparency measures extending beyond these requirements, including such access to individuals, documentation, equipments and facilities as may be required and deemed necessary by the IAEA’. See also Resolution 1695 (2006).

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of the NPT; on the basis that there is no provision in the NPT for a suspension of a withdrawal; that not all parties to the NPT were informed; and that the explanation of the ‘extraordinary events’ in 2003 was absent.166 Indeed, Masahiko Asada observes that there is ‘an attempt to deliberately obfuscate the legal situation with regard to North Korean status under the NPT’167 and that the ‘international community … is deliberately refraining from clarifying North Korean status under the NPT.’168 Masahiko Asada’s candid insight and his reasoned conclusion that North Korea has withdrawn from the NPT on the basis that the procedural flaws, if accepted, cannot as a matter of treaty interpretation, subsequent State conduct and International Law, invalidate the notice of withdrawal.169 Parties to the NPT have not made a determination on the question of North Korean withdrawal. However, the IAEA notes albeit in a Factsheet on its website, on the one hand: The IAEA is not a party to the NPT and hence it is not in the position to determine the status of any State Party’s membership of the Non-Proliferation Treaty. NPT States Parties´ comprehensive safeguards agreements with the IAEA provide that such agreements would remain in force as long as the State is party to the Non-Proliferation Treaty.170

On the other hand, the IAEA regards North Korea to be bound by the Safeguard Agreement from 1994 onwards.171 Moreover, the UN Security Council reinforced this for example in its Resolution 1695 (2006): Deploring the DPRK’s announcement of withdrawal from the Treaty on N ­ on-Proliferation of Nuclear Weapons (the Treaty) and its stated pursuit of nuclear weapons in spite of its Treaty on Non-Proliferation of Nuclear Weapons and International Atomic Energy Agency (IAEA) safeguards obligations. (emphasis added)

As is well known there have been many UNSC Resolutions condemning the actions of North Korea in its various efforts to arm itself with nuclear weapons, including the imposition of sanctions on the country.172 Equally it is well understood that these UN Security Resolutions are legally binding deriving their legitimacy from

166 

See generally Asada, above n 152. ibid, 332. 168  ibid, 355. 169  ibid, 350. 170 See Fact Sheet on DPRK Nuclear Safeguards: https://www.iaea.org/newscenter/focus/dprk/ fact-sheet-on-dprk-nuclear-safeguards. 171  See Implementation of the NPT safeguards agreement between the Agency and the Democratic People’s Republic of Korea Resolution adopted on 26 September 2014 during the ninth plenary meeting. GC (58)/RES/15 (September 2014) https://www.iaea.org/About/Policy/GC/GC58/GC58Resolutions/ English/gc58res-15_en.pdf; and Safeguards Statement for 2016 para 37 http://undocs.org/A/48/133. 172  These include resolution 825 (1993), resolution 1695 (2006), resolution 1718 (2006), resolution 1874 (2009), resolution 1887 (2009), resolution 2087 (2013), resolution 2094 (2013), resolution 2270 (2016), resolution 2321 (2016), resolution 2356 (2017), resolution 2371 (2017), resolution 2375 (2017), as well as the statements of its President of 6 October 2006 (S/PRST/2006/41), 13 April 2009 (S/PRST/2009/7), 16 April 2012 (S/PRST/2012/13), and 29 August 2017 (S/PRST/2017/16) and Resolution 2397 (2017). See https://www.un.org/sc/suborg/en/sanctions/1718/resolutions. 167 

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the Charter of the UN.173 There are two observations that need to be made about these UN Security Council Resolutions. First, several of the resolutions including the latest proffer the following observation: Expressing its gravest concern at the ballistic missile launch by the Democratic People’s Republic of Korea (‘the DPRK’) on 28 November 2017 … and at the challenge such a test constitutes to the Treaty on Non-Proliferation of Nuclear Weapons (‘the NPT’) (Emphasis added).174

Other than the nuclear-weapon States, it is generally almost universally accepted (and certainly, in terms of justice), that the rights and obligations under the NPT are unfairly distributed as between nuclear and non-nuclear-weapon States. It is also the case that under the NPT a State has the freedom to withdraw from the treaty; and as a matter of International Law including under the UN Charter itself, a State has the sovereign right to join or not to join the NPT. In this respect the recent Treaty on the Prohibition of Nuclear Weapons, which does not differentiate between nuclear and non-nuclear-weapon States,175 is of course welcome. Could it arguably also be a challenge to the NPT if the UN resolution is to be interpreted literally? In short, it is questionable whether the UNSC is the proper vehicle, or indeed has the mandate, to coerce another State, not to pose within the bounds of International Law, a challenge to the NPT. The language of the UNSC Resolution referring to the challenge to the NPT is too wide in its scope, leaving aside the question of the propriety of the actual conduct of North Korea in question. Second, more recent UN resolutions call for the ‘the return of the DPRK to the Non-proliferation Treaty (NPT) and International Atomic Energy Agency safeguards at an early date’.176 Whilst this call was accompanied by a reinforcement of the NPT obligations at any rate in 2006177 is it now a determination of the status of the withdrawal of North Korea given that the UNSC Resolution in 2017178 is not accompanied by a reiteration of North Korea’s NPT obligations as such, even if the Resolution refers to past resolutions? The legal status of the withdrawal of North Korea on a reading of all the UNSC resolutions may however still be under a cloud given that ‘return’ could be interpreted not so much as ‘withdrawn and re-join’ as ‘resume’ existing undertakings. If there is however here an implicit acceptance of the North Korean withdrawal—unlike India, Pakistan and Israel—North Korea is being required to become a party to the NPT. This is inconsistent with the NPT which has a provision for withdrawal. In sum, there is here a veil with respect to the status of North Korea in the NPT that is founded on an international strategy for the denuclearisation of the Korean peninsula, and the premise that this is an approach in the interest of

173 

See UN Charter, Ch VII. See UN Resolution 2397 (2017). 175  Adopted 7 July 2017. See A/CONF.229/2017/8. The treaty will come into force 90 days after the fiftieth instrument of ratification has been received. 176  See Resolution 1695 (2006) and Resolution 2397 (2017). 177  See S/RES/1718 (2006). 178  Para 26 UNSC Resolution 2397 (2017). 174 

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the achievement of peace and security. This is misconceived and brings International Law into disrepute. All States are entitled to equal and fair access to the rule of law, and where there is a perception of a distortion in this respect, this could engender non-compliance. Security Council members doubtless appreciate that in these changing times, the prerogative of the Security Council is not absolute; and that it rests in the shadows of the principal judicial organ of the United Nations—whose composition is no longer necessarily reflected by the presence of nationals from the permanent members of the Security Council.179 Finally, to complete the picture, various proposals for the denuclearisation of the Korean peninsula have been made. These include the establishing of a nuclear free zone (NWFZ);180 continuation of the Six Party Talks (involving China, Japan, North Korea, Russia, South Korea and the United States which first began in 2003) including the commitments made in the Joint Statement of 19 September 2005 linking denuclearisation with economic aid and security guarantees.181 In passing it may be observed here that should denuclearisation occur in the Korean peninsula as a result of the involvement of the UN and/or other countries, the regime that will be embedded may rob any future united Korea of a capacity to establish itself as a nuclear weight within NEA.

V.  Approaches to Resolving Historical Conflicts in a Regional Setting Historical injustices as between nations pollute inter-se relations; divert resources in the pursuit of rectificatory justice; and hinder the unlocking of development

179  See the appointment of the Indian candidate in late 2017 to the International Court of J­ustice instead of the candidate form the UK. http://www.bbc.com/news/uk-politics-42063664. See also the now substantial literature on the relationship between the International Court of Justice and the UN Security Council for example Vera Gowlland-Debbas ‘The Relationship Between the International Court of Justice and the Security Council in the Light of the Lockerbie Case’ (1994) 88(4) The ­American Journal of International Law 643–77. Note: Whilst there is no express authority that the ICJ has of judicial review of the conduct of the UN Security Council it is neither prohibited. 180  See Eric YJ Lee, ‘The complete denuclearization of the Korean peninsula: Some Considerations under International Law’ (2010) 9 Chinese Journal of International Law 799–819. See also UN GA defines NWFZ: See also General Assembly resolution 3472 B (1975) which defines a Nuclear-WeaponFree Zone as:

‘… any zone recognized as such by the General Assembly of the United Nations, which any group of States, in the free exercises of their sovereignty, has established by virtue of a treaty or convention whereby: (a) The statute of total absence of nuclear weapons to which the zone shall be subject, including the procedure for the delimitation of the zone, is defined; (b) An international system of verification and control is established to guarantee compliance with the obligations deriving from that statute’. Note also Art VII of the NPT. 181 

See https://www.armscontrol.org/factsheets/6partytalks and UNSC Resolution 2397 (2017).

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that comes from co-operation as between States. Indeed, the national paralysis that comes from the nation’s sense of historical injustice detracts from focusing on the underlying issues the historically entrenched grievances are concerned with— other than in terms of the pursuit of rectificatory justice. There are a number of cogent reasons for stepping back from the perception that there is only one path to addressing a historically entrenched conflict through the pursuit of rectificatory justice viz economic analysis, forgiveness, other forms of justice for example distributive justice; realism and the idea of ‘sustainable justice’ ie not encumbering future generations unduly from the efforts of achieving historical justice for a past generation. Such considerations (including a rectificatory justice approach) are not mutually exclusive and may be considered cumulatively. The important point to note is that there are different approaches to addressing historical conflicts. The role of the scholar is to present an objective set of options to national policy-makers and the public at large with respect to historical conflicts. It is not to parade the advocacy of national standpoints in the form of scholarship. First, to this author’s knowledge there has been no proper economic analysis focusing on the costs and benefits of all the major grievances as between the States in NEA. Thus, where is the balance in the scale of costs and benefits to both Korea and Japan in a continued stale mate on the conflicts focusing on Comfort Women and the Dokdo/Takeshima islands? The concerns with respect to the Comfort Women have included an array of litigation, purported settlements, NGO efforts, adverse bilateral relations, international condemnation and deep antagonistic feelings in circumstances wherein the real and direct victims might seem to have become pawns in a wider network of issues. In the same vein, with respect to the Dokdo/Takeshima and Senkaku/Diaoyu Islands disputes there has been a long running conflict between Korea and Japan, and Japan and China respectively, that has included the loss of lives, a build-up and maintenance of armies, and adverse economic and other bilateral relations. The costs of this organised ‘Island conflict industry’ needs to be weighed against the actual economic and strategic values of the islands and maritime zones to all the respective States, including the possible realisation of those same concerns through an approach that partakes not merely of the logic of rectificatory justice alone. Finally, can the concerns over nuclear tensions in the Korean peninsula be the subject of economic analysis. Certainly, the nuclear conflict in the Korean peninsula has its roots in the resultant post-war arrangements for the Korean peninsula arising out of the Japanese occupation of Korea, and informed by the lenses of McCarthyism. Nuclear armament has an obvious cost, as do nuclear responses to a nuclear adversary. These costs have to be weighed against the costs of achieving security through alternative approaches to achieving national and regional security objectives. Second, forgiveness is a feature of most major religions and civilisations. A political impact of a people forgiving is poignantly illustrated by Nelson ­Mandela’s famous quote: ‘Forgiveness liberates the soul, it removes fear. That’s why it’s such a powerful weapon.’ Nelson Mandela appreciated fully that forgiveness resulted in the oppressor never having any hold on you again. It was the act of forgiveness of

Approaches to Resolving Historical Conflicts in a Regional Setting 119

the black South Africans that in the end facilitated their liberation from the evil and oppression of apartheid. It would be patronising and presumptuous of an outsider to preach the lessons from the South African experience of forgiveness to the States in NEA. Nevertheless, scholarship calls for a highlighting of it in the range of considerations that should factor in the resolution of historical conflicts. Third, historical disputes can also be considered from a vantage removed from rectificatory justice. Thus, the Comfort Women issue removed from the resolution of the question of responsibility, is also at any rate in some measure about how best to compensate the Comfort Women for their misfortune, whatever the source of that misfortune and compensation. Thus, if Comfort Women are equated with those members of society who are the least well off, applying distributive justice along with Rawls’s Difference Principle, justice requires special and preferential treatment to be accorded to Comfort Women within Korea. This in some measure has been realised. In the same vein, the disputes in NEA on island sovereignty and maritime delimitations are about allocation of scarce resources, and therefore engage principles of distributive justice (contra rectificatory justice). To whom and what would the States in NEA behind Rawls’s original position and ‘veil of ignorance’ allocate these respective islands and maritime zones, leaving aside historical events? Similarly, the right to possess nuclear armaments can be considered as a ‘public good’ whose allocation can be approached from a distributive justice perspective. Equally any restraints on the acquisition and use of nuclear armaments directly through development and armament or indirectly through a nuclear security umbrella of another, can be considered as burdens, which need to be shared, at any rate prima facie equally. Finally, in international political and legal analysis law partakes of power. Indeed, the conception of law (and International Law) as a process182 is underpinned by the reality of power. However, aside from the question of the nature of International Law and the setting of power in that context, importantly there is the undeniable need in so far as historical conflicts are concerned for such disputes to be reflected upon through realistic rather than idealistically tainted lenses. Historical conflicts are marred by difficult questions of fact and interpretations. Moreover, they are also subsequently frozen in a power structure difficult to unfreeze in the foreseeable future. Is it appropriate that one generation should burden successive generations with their sense of injustice removed from future generations? In sum, legal analysis of historical conflicts solely in terms of the pursuit of rectificatory justice can be debilitating if considered from the perspective of the overarching question as to why regional historical conflicts need to be resolved, if at all. The overarching quest in addressing these historical ghosts is surely regional

182  See for example Myres S McDougal, ‘Law as a Process of Decision: A Policy-Oriented Approach to Legal Study’ (1956). Faculty Scholarship Series. Paper 2464. http://digitalcommons.law.yale.edu/ fss_papers/2464.

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development and prosperity through cooperation or at the least through mutual co-existence. Moreover, a proper legal analysis of the claims underlying historical conflicts cannot fully divest itself from such considerations in its final recommendations. Contextualising International Law to historical conflicts with a regional setting is as much about understanding law in context as it is about placing law in its proper place in the wider plural normative setting within which it exists. Resolving historical disputes through legal/adjudicative analysis is not the only normative basis through which States can move on from historical disputes. Above all developing a proper common understanding of the historical conflicts is surely the sharpest knife that justice can proffer. The pursuit of truth is as much an endeavour that partakes of the quest for justice, and whereas justice may be difficult to attain, truth is a realisable goal.

Part Three

Foreign Economic Relations

122 

5 International Legal Aspects of ‘Monetary’ Relations in North East Asia1 ‘Monetary policy may be at the epicentre of State sovereignty— but it is also at the heart of good neighbourly relations!’ Asif H Qureshi

I. Introduction There is a growing awareness in the International Monetary Fund (IMF) of the need to focus on ‘interconnectedness’, ‘transmission channels for spill overs’,2 and clusters of members.3 This coupled with the emergence of ‘regional financial arrangements’4 raises the question whether there is or should be a paradigm shift that cuts across the State model focus of the IMF. This is of course an economic and operational perspective. Can the IMF institutional framework adapt itself to focusing on clusters of States, with no or varying degrees of legal cohesion? Can the legal perspective inculcate disciplines in transmission channels? The underlying focus of this chapter is this theme through the lenses of the monetary r­ elations

1  I am grateful to Sean Hagan, General Counsel IMF, for allowing me the opportunity to work on this chapter in the Legal Department of the IMF in 2016. My thanks also to Nadia Rendak from the Legal Department of the IMF for carefully providing feedback from a previous version of this chapter. I am also grateful to Kyung Kwak; Hoang Pham; and Mikari Kashima from the Legal Department of the IMF; and Chang Rhee, Director Asia Pacific Department in the IMF, for their kind assistance. The errors and views remain mine alone. A talk on the basis of this chapter was delivered in the IMF Legal Department on 16 August 2016. This chapter is based on an article published in the (2017) 16(2) ­Chinese Journal of International Law 215–50. 2  See for example Spillover Report: IMF Japan: Spillover Report for the 2011 Article IV Consultation and Selected Issues IMF Country Report No 11/183 (July 2011); IMF: 2015 Spillover Report. 3  See for example IMF Executive Board Reviews Mandatory Financial Stability Assessments Under the Financial Sector Assessment Program Press Release No. 14/08 January 13, 2014; IMF Staff Paper, Adequacy of the Global Financial Safety Net March 2016. 4  See for example IMF: ‘Stocktaking the Fund’s engagement with Regional Financial Arrangements’ (April 2013).

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in North East Asia. In this context, the objectives of this chapter are to map the legal framework of monetary relations as between the States in North East Asia (NEA) (China, Japan, Korea); generally, to reflect on IMF law from a regional ­perspective; and to outline relevant ethical/good neighbour standards of behaviour. In this chapter the term ‘monetary’ is used in the sense of its description of the ‘international monetary system’ within the IMF.5

II.  Is there a Rationale for a Regional NEA Focus? There has been much ado about the need to improve regional monetary co-operation in East Asia as a result of the Asian currency crisis of 1997–98—a ­message reinforced further a decade later by the impact of the global financial crisis of 2007–09 on the region.6 This discourse has focussed mainly on the need to ensure stability of exchange rates within the region, in particular the avoidance of competitive devaluation; provision of liquidity in case of monetary emergencies; and policy coordination through, for example, regional surveillance mechanisms. This academic discourse is set against the background of political initiatives in

5  See IMF Legal Department: ‘The Fund’s mandate: The Legal Framework’ (2010) para 21: ‘The rules governing exchange arrangements between countries and the rates at which foreign exchange is purchased and sold; The rules governing the making of payments and transfers for current international transactions between countries; The rules governing the regulation of international capital movements; and The arrangements under which international reserves are held, including official arrangements through which countries have access to liquidity through purchases from the Fund or under official currency swap arrangements.’ 6  See for example, M Kawai, ‘From the Chiang Mai Initiative to an Asian Monetary Fund’. ADBI Working Paper 527 (2015). Tokyo: Asian Development Bank Institute. Available: http://www.adbi.org/ working-paper/2015/05/20/6612.chiang.mai.asian.monetary.fund/; Masahiro Kawai, Yung Chul Park and Charles Wyplosz (eds), Monetary and financial cooperation in East Asia: the state of affairs after the global and European crises (Oxford, OUP, 2015); Injoo Sohn, East Asia’s Counterweight S­ trategy: Asian Financial Co-operation and Evolving International Monetary Order. UNCTAD G 24 Discussion Paper Series (2007); Pradumna B Rana, ‘Monetary and Financial Cooperation in East Asia: The Chiang Mai Initiative and Beyond’, ERD Working Paper Series, No 6 (2002), http://hdl.handle. net/11540/1921; Raul Fabella, Monetary Cooperation in East Asia: A Survey ERD Working Paper No. 13, Asian Development Bank (2002); Woosik Moon and Yeongseop Rhee, ‘Asian Monetary Cooperation: Lessons from the European Monetary Integration’ (1999) 6(1) Journal of International and Ariel Studies 33–49; Junichi Goto, Economic Preconditions for Monetary Cooperation and Surveillance in East Asia, Research Institute for Economics and Business Administration, Kobe University (2002), http:// www.rieb.kobe-u.ac.jp/academic/ra/dp/English/dp132.PDF; Peter Wilson, ‘Prospects for Asian Monetary Cooperation After the Asian Financial Crisis: Pipedream or possible reality?’ National University of Singapore Working Paper No 151 (2002) http://econpapers.repec.org/paper/hhseijswp/0151.htm; Eiji Ogawa, ‘Regional Monetary Cooperation in East Asia Against Asymmetric Responses to the US ­Dollar Depreciation’ (2004) http://www.akes.or.kr/akes/downfile/eiji20ogawa2.pdf; TD Willet et al, ‘Asian ­Monetary ­Cooperation: Perspectives from the Optimum Currency Area Analysis’ (2008) http:// cgu.edu/PDFFiles/SPE/Willett/Papers/Permpoon%20Srisorn%20Willett.pdf; C Randall Henning, ‘The Future of the Chiang Mai Initiative: An Asian Monetary Fund?’ (Peterson Institute for International Economics: 2009) http://www.iie.com/publications/pb/pb09-5.pdf.

Is there a Rationale for a Regional NEA Focus? 125

the wake of the Asian currency crisis, such as the call by Japan for an Asian Monetary Fund in 1997; the setting up of the Chiang Mai Initiative in 2000 and later the C ­ hiang Mai Initiative Multilateralization as amended in 2014; the Asian Bond Markets Initiative in 2003; the Economic Review and Policy Dialogue (ERPD) in 2000, and the ASEAN Plus 3 Macroeconomic Research Office (AMRO) 2010.7 Indeed, the deliberations have also engaged in the possibility or otherwise of the necessary conditions for a common Asian currency, against the background of increasing monetary integration in the European Union. However, with the decline in enthusiasm for monetary integration in Europe, against the backdrop of its sovereign debt crisis; and the lack of leadership amongst key players within NEA; the momentum for monetary coordination has lost its steam.8 The academic discourse has been mainly from an economic perspective, and set against the background of States in East Asia generally—in particular ASEAN Plus 3 countries. There has been little focus from a legal perspective however of the monetary relations within East Asia, other than some focus on the implications of competitive devaluations within NEA.9 Nor has there been much consideration of the external legal aspects of monetary relations in NEA, other than the implications of competitive devaluation of the Chinese RMB.10 There is therefore justification for further legal focus on monetary relations in NEA. However, be that as it may, are there sound reasons for a regional focus in monetary relations from an international legal perspective? More specifically are there sound reasons for focusing only on the monetary policies of certain countries alone in East Asia? Moreover, is there indeed a legal perspective of the matrix of monetary policies in NEA that extends beyond competitive devaluation concerns? International Law in this interdependent global economy has a number of functions in the management of State monetary relations at a regional level. First, it serves to define the scope of State monetary discretion, where the exercise of that discretion is particularly susceptible to impacting on neighbouring economies. Although neighbouring economies per se may not in themselves in this era be susceptible to monetary interactions it is reasonable to assume that there is a strong likelihood of such an interaction given the nature of the natural development of international trade and labour movement. Second, it can shed some light on the optimal degree of regional inter-State monetary cooperation, in particular in circumstances where there could be a possibility of war in the future with the

7 

See Kawai, ibid, 10 for a chronology. See for example Yung Chuk Park and Chi-Young, ‘A view from the Republic of Korea’ in Kawai, Park, and Wyplosz, above n 6, 199. 9  But see John Riley, ‘The Legality of Japan’s Current Monetary Policy under International Law’ (2014) 1 JEAIL; and Xin Chen, ‘Japan’s Unspoken Currency Manipulation by Monetary Policies: A Chinese Lawyer’s Perspective’ (2014) 1 JEAIL 1. 10  See, for example, RW Staiger and A Sykes, ‘“Currency manipulation” and World Trade’ (2010) 9(4) World Trade Review 583–627. 8 

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co-operating neighbouring States. Third, it can inform how cooperative arrangements can be built in a regional framework. Finally, there is an inter-face between regional monetary co-operation and multilateral commitments, the scope of which is informed by the international monetary law mainly set in IMF law. This role of International Law is also beset with some challenges. First, given that regional monetary co-operation is an economic desideratum for economic progress, particularly in enhancing regional trade, is there a legal basis for the IMF to act as a facilitator in this process? The IMF is essentially multilateral in its focus. Second, if in the regional milieu lurk monetary hegemonic intentions, how are these to be managed both within and outside the purview of the region? What is the scope of the IMF mandate in this respect? Finally, does justice, in particular distributive justice as an aspect of law, often lost sight of in the technical morass of international monetary law, have a role in the shaping of regional monetary cooperation, as much as in the region’s external relations individually or collectively? Distributive justice has a function in the shaping of regional cooperative arrangements—in the allocation of monetary decision-making powers, in the distribution of liquidity, and in the allocation of external monetary benefits to the region as a whole. In sum, there is a perspective to regional monetary cooperation that calls for greater appreciation in law and justice. Such a legal perspective is set not only in the apparatus of State cooperation and State rights within, but also in the manner of its interface with the IMF law and its impact on non-State entities within and outside the region. The China, Korea and Japan combination comprises of a complex cocktail of cooperative and interdependent forces, but also potentially if not actually of hegemonic and self-interested designs, including vulnerabilities. The three economies are significantly linked,11 in particular through the amount of trade as between themselves. Thus, Japan and Korea are amongst the main destinations of Chinese exports.12 This speaks volumes about the importance of the Japanese and Korean markets, given China’s lead in world exports. Indeed, Japan is one of the largest export markets for China.13 Conversely, Korea and Japan are amongst the main sources of imports for China,14 with Japan being one of the largest sources of imports.15 Korean exports into China in 2011 amounted to some 24.2 per cent of its total exports.16 Korean exports to Japan in 2011 were seven per cent of its total exports.17 Imports into Korea from Japan amounted to some 15.8 per cent in 2011, and from China some 17.7 per cent.18 Korean imports from and to China are

11 See IMF, Asia and Pacific Dept: Regional Economic Outlook (2016), https://www.imf.org/en/ Publications/REO?sortby=Date&series=Asia+and+Pacific+Region&year=2016. 12  WTO: China—Trade Policy Review (2014) (WT/TPR/S/300). 13  WTO: Japan—Trade Policy Review (2015) (WT/TPR/S/310). 14  Above n 12. 15  Above n 13. 16  WTO: Korea—Trade Policy Review (2012) (WT/TPR/S/268). 17 ibid. 18 ibid.

Is there a Rationale for a Regional NEA Focus? 127

also significant.19 In the same vein, Japan and Korea have significant investments in China,20 and Japan in Korea.21 In sum, within NEA are situated some of the largest trading nations in the world, and trade and investment amongst them is of a significant proportion. Externally outside NEA, Japan and Korea compete in key sectors of their exports viz electronics and automobiles. Thus, Japan is Korea’s principal export market competitor.22 Moreover, China’s move up the value chain reinforces the competitive environment in the electronics sector.23 In the circumstances, the respective monetary frameworks concerned with intra monetary trade and investment flows, as well as such external relations, acquire a particular ­significance. Indeed, based on recent US legislation, it seems a certain level of critical economic relationship with another State, can give each State a locus standi in the monetary policies and practices of the other.24 To some degree, this inter-dependence is recognised and illustrated in recent respective IMF surveillance reports of the three countries. Thus, IMF surveillance has flagged out the impact of Japanese Yen depreciation on its direct competitors;25 the Renminbi appreciation against the Yen, and the fact that the Yen and Korean Won26 featured in the basket of currencies against which the Renminbi is managed by China;27 the weak Yen’s consequences on the Korean market share, including its effects on the ‘profit margins of Korean and Japanese exporters,’ resulting in ‘higher profits for Japanese exporters and lower for Korean firms’—viz., the profits margins of Hyundai Motors are noted to have ‘decreased by around 20 per cent while Toyota’s increased by over 60 per cent’ around 2012, thus indicating a ‘high correlation between profit margins and exchange rate movements.’28 Moreover, the IMF Risk Assessment Matrix (RAM) in the respective recent surveillance exercises of China, Korea and Japan, include aspects of the relationships between the economies of the three countries, including in particular China and the exchange rate of the Yen. In addition to such IMF focus, the three countries are major trading partners of the US, and thus under the newly enacted US Trade Facilitation and Trade Enforcement Act 201529 are liable to special US focus and monitoring in their engagement with currency exchange rates and economic policies, for signs of inappropriate currency exchange rate manipulation, including possible s­ anctions.

19 ibid. 20 

Above n 12. UNCTAD Bilateral Investment Flows Statistics: http://unctad.org/en/Pages/DIAE/FDI% 20Statistics/FDI-Statistics-Bilateral.aspx. 22  IMF: Art IV—Korea Country Report No 15/130 (2015). 23  IMF: China—Art IV Country Report No 15/234 (2015). 24  US Trade Facilitation and Trade Enforcement Act 2015. 25  IMF: Art IV- Japan Country Report No 15/97 (2015). 26  Does not seem to feature in the latest basket of currencies. 27  Above n 23. 28  Above n 22. 29 Title VII—Engagement on Currency Exchange Rate and Economic Policies of the Trade ­Facilitation and Trade Enforcement Act of 2015. 21 See

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Indeed, the three countries’ exchange rate policies were the subject of note in a recent US Treasury Report to Congress mandated under the 2015 Act.30 Could such a unilateral response to the region’s monetary policy undermine the Fund’s regional surveillance competence? In conclusion, the monetary policies of the respective States of NEA are generally recognised as being sufficiently intertwined internally within the NEA, and outside NEA as being significant in their external impact respectively, that they raise questions of fair play and call for cooperation as between the three States. This is underlined by the fact that the Governors of the Central Banks of the three countries have met on six different occasions since 2009 to ‘exchange views on macro-prudence, financial stability, regional cooperation and other issues of common interest related to economic and financial developments.’31 Despite such meetings, there are differing perceptions within NEA of the need to cooperate in the monetary sphere as between the three countries. Thus, the Chinese perspective has been described as follows.32 First, it has been observed that China is not enthusiastic about developing regional monetary cooperation. It does not perceive the need to cooperate at a regional level. This conclusion is reinforced by the territorial disputes it has in the region. Second, China is more preoccupied with stability of currency exchange rates with the rest of the world, than with intra-regional rates. This is because, according to Chinese analysis at any rate, much of the interregional trade is as between multinational enterprises within the region of intermediate products processed for final exporting outside the region.33 ­Moreover, given that most of China’s foreign assets are denominated in US dollars, the relationship between the dollar and RMB needs to be such that the RMB does not appreciate, so as to undermine the value of China’s foreign reserves, most of which are denominated in dollars.34 Third, there is a perception that Chinese interests are best served in internationalising the RMB.35 However, both for Japan36 and Korea37 intra-regional currency stability is seen as important, as it would lead to efficiency in the intra-regional trade. Thus, the Japanese Central Bank specifically observes on its website as follows: Financial and economic stability in Asia has become ever more crucial to Japan’s economy amid further globalization and growth in business and financial transactions between

30  Report on Foreign Exchange Policies of Major Trading Partners of the United States (April 2016) https://www.treasury.gov/press-center/press-releases/Pages/jl0443.aspx. 31 See Trilateral Cooperation Secretariat http://www.tcs-asia.org/dnb/board/list.php?board_ name=3_2_5_finance; and Japanese Central Bank: https://www.boj.or.jp/en/intl_finance/cooperate/ index.htm/. 32  Yongding Yu, ‘A view from the People’s Republic of China’ in Kawai, Park and Wyplosz, above n 6, ch 6. 33 ibid. 34 ibid. 35 ibid. 36  Masahiro Kawai, ‘A view from Japan’ in Kawai, Park and Wyplosz, above n 6, ch 7. 37  Yung Chuk Park and Chi-Young, ‘A view from the Republic of Korea’ in Kawai, Park and Wyplosz, above n 6, ch 8.

Is there a Financial and Normative Framework 129 Japanese institutions and counterparties located in Asia. Based on this recognition, the Bank of Japan endeavors to play a more active role in strengthening financial cooperation in the region, so as to contribute to the financial and economic stability in Asia.38

Moreover, Japan is also interested in the further internationalisation of the Yen39— a possibility that seems to have been explored for the Korean Won too.40 In sum, given these differing stand-points both China and Japan are unable or unwilling to give leadership in the efforts to facilitate regional monetary cooperation.41 Finally, this divergence in outlook could be reinforced at the level of the IMF. Here it will be noted that all three do not speak from one constituency (and probably one voice depending on the issues) in the Executive Board (EB) of the IMF. Hitherto at any rate China and Japan have their EB directors appointed, whereas Korea is part of a group of countries represented by a director.42 The votes each country has within the IMF are as follows: China 306,288; Japan 309,664: Korea 87,286.

III.  Is there a Financial and Normative Framework for the Management of Regional Monetary Relations? The national monetary regimes of China, Korea and Japan are informed by Customary International Law; regionally specific bilateral or regional arrangements where these exist viz swap and monetary co-operation arrangements; along with the law and practice of the IMF. Generally, this monetary framework is not specifically NEA oriented—in contrast to other economic spheres of co-operation within the region. For ­ ­example, the three countries are intertwined with bilateral double taxation agreements; a trilateral investment agreement; and on-going negotiations for a trilateral free trade agreement. Moreover, it is in important aspects of a soft-law character, in particular with a weak enforcement apparatus. In addition, the architecture of the Fund focuses on Member States and not regions or clusters of States— although at an operational level the fund’s focus is more malleable. Fund practice has been not to discriminate between members although there are occasions when the Fund based on objective criteria distinguishes between groups of members.

38 

See https://www.boj.or.jp/en/intl_finance/outline/index.htm/. Kawai, above n 36. 40  Park and Chi-Young, above n 37, 215. 41 ibid. 42 http://www.imf.org/external/np/sec/memdir/eds.aspx. 39 

130  Monetary Relations in NEA

I­ nstitutionally the Fund has a bilateral and/or a multilateral approach;43 although it does take into account formal Currency Unions. This normative regime is also in some aspects non-transparent. This is because the nature of the financial co-operative arrangements involved; the fact that there is no systematic central depository accessible to the public, for example with the IMF, of some important member and regional specific developments that are short of a Currency Union. In this respect, the IMF notification requirements are limited by a member’s obligations under the IMF and thus seem not to be exhaustive and/or not stringent enough. Thus, there are no clear requirements to notify the number of regional or swap arrangements as such. And whereas the details of the basket of currencies against which the national currency is pegged should be notified,44 and the Fund has a wide mandate to seek information from members,45 such information for outside researchers can be difficult to ascertain. This is a problem recognised within the Fund and under consideration.

A. Is there a Prohibition to Harm Another State’s Economy Under Customary International Law? In a regional setting one important question is whether each of the States in NEA has a responsibility towards the other of negative spill overs of their monetary policies at the level of Customary International Monetary Law. This is a question that is informed at a practical level by the kind of spill overs envisioned for normative capture; in part at a theoretical level by conceptions of monetary sovereignty; and finally, from the international practitioner’s perspective in terms of State practice and opinio juris. The question that needs to be addressed at the outset is the kind of State conduct giving rise to negative external consequences that is under focus here. This question can be addressed generally or specifically with reference to a particular type of adverse consequence. When addressed generally, State conduct that has adverse/negative external spill overs, at first blush seems an open-ended reference, embracing potentially a multitude of consequences outside the control of a State. However, this on its own cannot suffice to forestall discourse on the subject of State responsibility. It is indeed possible to formulate the State conduct with some specificity, so as to focus for example on adverse consequences which are foreseeable; intended; and unfair in terms of level playing fields;

43  The Fund’s administration is however organised in terms of regional units viz African (AFR), Asia and Pacific (APD), European (EUR), Middle East and Central Asia (MCD), and Western H ­ emisphere (WHD). 44  See EB Decision No 5712-(78/41), March 23, 1978. 45  See Art VIII (5) of the IMF Articles of Agreement; and EB Decision No 13183-(04/10), ­January 30, 2004, as amended; and Art IV s 3. See also IMF: 2012 Review of Data Provision to the Fund for Surveillance Purposes; and IMF Data Provision to the Fund for Surveillance Purposes (2000).

Is there a Financial and Normative Framework 131

or the u ­ ndermining of a universally agreed communal objective. In some measure international monetary law and State practice already reflects this. The concept of monetary sovereignty has been relied upon as a basis generally for non-responsibility of the external consequences of a State’s monetary ­practices46—reflecting ‘laissez-fair’ sovereignty sentiments of a pre-Bretton Woods era. Thus, the 2008 financial crisis precipitated a proposed amendment to the IMF Articles of Agreement imposing an obligation on members to take into account the implications of their economic policies on the international monetary system.47 This proposal was however rejected, and is explained by Sean Hagan, General Counsel of the IMF, as follows: While such an amendment would have been consistent with the overall mandate of the IMF, it would have entailed a sacrifice of sovereignty by member countries, particularly those that were sufficiently large that their domestic policies were likely to have a systemic impact. For this reason, there was inadequate support for this proposal.48

This IMF lack of consensus cannot be read as reinforcing a pre-Bretton Woods era conception of a State’s monetary sovereignty and its limitations. One inference can be that the lack of consensus was merely about not reiterating/elaborating/ expanding upon a customary norm development in the Articles of Agreement of the IMF, without prejudice to the existence or otherwise of such a norm under Customary International Law. Another inference could be that this was a misconceived perception of a sacrifice of sovereignty on the part of certain members of the Fund which did not exist in the first place—and in any event, reflected the views only of some States. Finally, and importantly, the proposed amendment was specifically with reference to member policies that benefited the member but which had negative spill over effects.49 At a theoretical level, as has been observed, monetary sovereignty is normative as it involves both rights and responsibilities—both of which are evolving, and contested.50 The normative content of monetary sovereignty involves: [B]oth more general values like democracy, equality, accountability, and legitimacy, and more specific ones like economic development, the maximization of global welfare, the maintenance of financial integrity, and the promotion of financial and monetary stability.51

46 See for example Asif H Qureshi and Andreas R Ziegler, International Economic Law 3rd edn ­(London, Sweet and Maxwell, 2011) 147; and J Gold, Exchange Rates: International Law and ­Organization (Chicago, American Bar Association, 1988). 47  See Sean Hagan, ‘Expanding the IMF’s Regulatory Authority—Incrementally’ (2016) 19 JIEL 375–77. 48  ibid, 376. 49  Comment by Sean Hagan made on the 16 August 2016. 50  Claus D Zimmermann, ‘The concept of monetary sovereignty revisited’ (2013) 24(3) European Journal of International Law 797–818. See also Claus D Zimmermann, A Contemporary Concept of Monetary Sovereignty (Oxford, OUP, 2013). 51  Zimmermann, ‘The concept of monetary sovereignty revisited’, ibid, 810.

132  Monetary Relations in NEA

This normative ethos is not set in International Law but if not adhered to by ­relevant decision-makers would, it has been claimed, albeit perhaps somewhat optimistically, erode their authority and legitimacy in the sphere.52 This compendium of normativity, whilst not directly having a bearing on the question of external harm to another State, nevertheless forms an important back drop for the management of certain kinds of external consequences of national economic measures. Finally, there are indeed sound reasons why the proposition that there is no obligation not to harm through monetary policy another State’s economy under Customary International Law, needs to be revisited. First, the membership of the IMF has agreed to the principle as reflected in the mandate of the IMF. Thus, the General Counsel of the IMF points out ‘such an amendment would have been consistent with the overall mandate of the IMF.’ Indeed, Article IV of the IMF Articles of Agreement set out a duty owed not only to the Fund but also to other members53 to collaborate in preventing negative spill overs. This obligation to collaborate is on the assumption that there is an obligation to prevent negative spill overs.54 Second, consciousness of State responsibility in other economic and related spheres, for example in the environmental,55 tax,56 trade57 and anti-trust spheres, has evolved to accept responsibility for external negative consequences resulting from actions within a State. Why should State monetary practice be different? Indeed, in Customary International Law, a State may not counterfeit the currency of another State; nor may a State deliberately change the value of its currency to injure foreigners.58 Such exceptions to general State monetary rights represent relevant State practice, and reflect a general principle in monetary practice, of not inflicting harm to another State. Third, in the light of the now near universal membership of the IMF and the WTO—whose normative regimes are essentially designed to address negative economic spill overs from ­domestic

52 

ibid, 812. IV: ‘… each member undertakes to collaborate with the Fund and other members to assure orderly exchange arrangements and to promote a stable system of exchange rates. In particular, each member shall: (i) endeavor to direct its economic and financial policies toward the objective of ­fostering orderly economic growth with reasonable price stability, with due regard to its circumstances; (ii) seek to promote stability by fostering orderly underlying economic and financial conditions and a monetary system that does not tend to produce erratic disruptions; (iii) avoid manipulating exchange rates or the international monetary system in order to prevent effective balance of payments adjustment or to gain an unfair competitive advantage over other members; and (iv) follow exchange policies compatible with the undertakings under this Section’. 54  As per Sean Hagan on the 16 August 2016. 55  Trail Smelter Arbitration, US-Canada, Decision, 11 March 1941, Reports of International Arbitral Awards, Vol 3 1938–1982. See also generally the WTO Agreements. 56  See developments in OECD under the Harmful Taxation and Base Erosion and profit shifting (BEPs). See also Reuven S Avi-Yonah, International Tax as International Law (Cambridge, CUP, 2007) (although this author elsewhere has disagreed with Avi-Yonah analysis on International Law.) 57  See generally WTO agreements. 58  See F Gianviti, ‘Current Legal Aspects of Monetary Sovereignty’ in IMF (ed), Current ­Developments in Monetary and Financial Law Vol 4 (IMF, 2005). 53  Article

Is there a Financial and Normative Framework 133

e­conomic policies, for example, the obligation not to manipulate currency exchange rates under Article IV; and the obligations not to discriminate under Article VIII section 3 of the IMF Articles—along with a heightened awareness of the negative consequences of a State’s monetary policies, the scope of permissiveness under Customary International Law of a State’s monetary policies must surely now be considered in a different light. At the least, there is a case to call for a State to reflect upon possible external negative consequences of its monetary/ economic policies, before engaging in them. Finally, if the case is not too strong at the level of responsibility to the world at large, is the case not stronger at the level of regional partners? After all the causal implications of a State’s monetary policy is likely to be more apparent with respect to regional partners. This discourse on whether or not there is some form of an obligation grounded in Customary International Law not to inflict monetary harm on another State may seem removed from realpolitik, given that any such obligation would be most burdensome on leading economies on whom it would be difficult to enforce such an obligation. However, there are three important reasons for clarity on this issue. First, any such customary law would have relevance in the interpretation of the IMF Articles of Agreement.59 Second, clarity on such a normative development can be a precursor for change in the attitude of the membership of the IMF. Finally, such a ‘soft law’ would be a tool for persuasion and self-reflection. Certainly, there is a case for the question to be explored within the Legal Department of the IMF. Is it conceivable that the question could inform an Opinion sought under Article 8 (2) (b) of the IMF Articles of Agreement?60 Thus, would the interpretation of ‘exchange control regulations of ’ a member ‘maintained or imposed consistently with’ the IMF Articles of Agreement61 need to be considered against the background of the existence of a norm under customary international law, prohibiting monetary harm to another member?

B.  Is there a Regionally Specific Normative Regime in NEA? There is no regionally specific monetary regime in NEA. There are however ­policy coordination and financial and currency exchange arrangements. First, there have been swap arrangements, at any rate in the past, as between the three countries, and there could be prospects for future such arrangements.62 Second,

59 

See Art 31 (3) (c) of the Vienna Convention on the Law of Treaties. See EB Decision No 446-4 (10 June 1949). Art 8 (2) (b) of the IMF Articles of Agreement. 62 See Nikkei Asian Review, January 2016 http://asia.nikkei.com/Politics-Economy/InternationalRelations/Japan-South-Korea-China-may-put-agreements-back-in-place. In October 2017 the ChinaKorea Swap arrangement was extended for another three years to the value of some 56.9 billion dollars (see J Jackson ‘Korea, China renew currency swap deal worth W64tr’ Korea Herald (13 October 2017) http://www.koreaherald.com/view.php?ud=20171013000740. 60  61 

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as between China and Korea, and as between Japan and China, arrangements on a bilateral basis have been placed for the direct conversion by non-State actors of their respective currencies without a dollar intermediary thus saving conversion costs.63 This has been done through the facilitation of market makers in order to establish the rate of exchange directly as between the currencies.64 In this manner the previous practice of converting to the dollar first has been eliminated thus saving conversion costs.65 This innovation is part of a greater Chinese scheme to enhance the use of the RMB globally and includes the establishment of Chinese Clearing Banks overseas to facilitate the supply of the RMB.66 Third, all three countries are also part of a wider far eastern grouping connected with ASEAN viz ASEAN Plus. Within this wider setting, NEA participates in the Chiang Mai Initiative Multilateralization as amended in 2010 (CMIM) including the ASEAN Plus 3 Macroeconomic Research Office (AMRO). CMIM is a multilateral currency swap arrangement.67 These financial arrangements have a normative impact on the countries even when they are not being availed as their existence must come in the calculation of relevant policy-makers. AMRO on the other hand serves directly to coordinate monetary policy-making. The CMIM aims to provide ‘regional short-term liquidity, address balance of payments difficulties, and supplement existing international arrangements.’68 Its resources were doubled in 2014 to US$240 billion.69 The ‘CMIM swaps are available for 6 months or one year, and can be renewed up to two years or three years, respectively.’70 Under the CMIM, there are a set of operational guidelines that elaborate on the process of activating swap operations.71 The application of conditionality is dependent on the discretion of the particular member facilitating the hard currency.72 IMF conditionality applies for access above 30 per cent73— ie, the member would need to draw on the Fund’s resources. However, it will be noted there is no agreement between parties to the CMIM and the IMF as to how this interface is to be coordinated. What if the Fund considered it inappropriate for the member to draw on its resources and/or that there was no need for any conditionality? 63  See for example http://www.pambazuka.org/global-south/china-and-japan-currency-swap; https://www.rt.com/business/170408-south-korea-china-yuan/; and Ministry of Finance, Japan ‘Enhanced Cooperation for Financial Markets Development between Japan and China’ (Fact Sheet: 2012) http://www.mof.go.jp/english/index.htm. 64  Mikari Kashima, Senior Counsel IMF Legal Department. 65  As this is not a possibility with other currencies within the region—is this a multiple currency arrangement within Art VIII s 3 prohibition? 66 http://english.cntv.cn/2015/04/15/VIDE1429072206085635.shtml. 67  IMF Policy Papers: ‘Adequacy of the Global Financial Safety Net’ March 2016. Thus far there have been no withdrawals under the facility, ibid. 68 ibid. 69 ibid. 70 ibid. 71  See IMF, above n 4, para 16. 72  ibid, para 12. 73 ibid.

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The CMIM has two facilities: (1) Crisis Prevention Facility—CMIM Precautionary Line and (2) Crisis Resolution Facility—CMIM Stability Facility.74 The conditions for the CMIM Precautionary Line under the 30 per cent de-linked to IMF Conditionality, focus on ‘(i) External position and market access; (ii) ­Fiscal policy; (iii) Monetary policy (iv) Financial sector soundness and supervision (iv) and (v) Data adequacy.’75 This qualification requirement has in outline form at any rate a similarity to that for the IMF Precautionary and Liquidity Line (PLL). Thus far CMIM has not been availed. The CMIM Agreement is not publicly available and therefore difficult to analyse from a legal perspective. However, key points of the 24 Articles and nine Schedules are to be found in an Annex on the AMRO website.76 The CMIM is considered not to be a treaty,77 and CMIM does not have international legal personality. It is not clear why the initiative has not been made public. It is possible that, given that the scheme partakes of swap arrangements, it is like swap arrangements, confidential. The terms of swap arrangements need to be confidential otherwise they could exasperate the market conditions they are intended to rescue. However, there are aspects of the initiative that could be made public in an authoritative manner, as is the case of IMF financial facilities. Does the fact therefore that the Initiative has not been made public to third parties make the Initiative somewhat flawed? Does it undermine the Fund’s ability to seek information from members under for example Articles IV Section 3 and VIII Section 5?78 The CMIM is supplemented by AMRO.79 AMRO is an international organisation that has been set up under the Agreement Establishing ASEAN Plus 3 Macroeconomic Research Office (AMRO).80 Its purposes and functions are set out as follows under the Agreement: Article 2. Purpose The purpose of AMRO is to contribute to securing the economic and financial stability of the region through conducting regional economic surveillance and supporting

74  See Kyung Kwak, Jonathan Swanepoel, Gustavo Pinto and Nikita Aggarwal ‘Regional Financing Arrangements—Friends or Foes?’ IMF Legal Department Brown Bag Lunch, 23 June 2015. 75  From a summary posted at Japanese Central Bank website: https://www.boj.or.jp/en/intl_finance/ outline/index.htm/. 76 See Key Points of CMI Multilateralization Agreement Annex 1, http://www.amro-asia.org/ about-amro/the-relationship-between-amro-and-cmim. 77  Although this must depend on a construction of the arrangement. It would be reasonable to infer given that the arrangement is not publicly available that it is not registered under Art 101 of the UN charter. 78  There is much in monetary relations as between States that is arranged outside formal agreements. In the interest of transparency and the spirit of Art 101 of the UN Charter is there a case for the Fund to formulate a policy addressed to its membership ensuring that bilateral/regional monetary relations should be conducted in a transparent manner to the extent possible. 79 http://www.amro-asia.org/. 80  The Agreement is to come effect after a certain number of ratifications have been received (see Art 26 of the Agreement). The Agreement came into effect in February 2016. The Headquarters of AMRO are in Singapore.

136  Monetary Relations in NEA the implementation of the regional financial arrangement. The term ‘regional financial arrangement’ means the multilateral liquidity support arrangement under the ASEAN +3 framework to address potential and actual balance-of-payments and short-term liquidity difficulties in the region. Article 3. Functions To fulfil its purpose, AMRO shall have the following functions: (a) to monitor, assess and report to members on their macroeconomic status and financial soundness; (b) to identify for members macroeconomic and financial risks and vulnerabilities in the region and assist them, if requested, in the timely formulation of policy recommendations to mitigate such risks; (c) to support members in the implementation of the regional financial arrangement; and (d) to conduct such other activities necessary for achieving the purpose of AMRO as may be determined by the Executive Committee.

AMRO’s newly established status as a fully functioning regionally-based financial cooperation organisation is to be noted. It started its regular consultations with China and Japan in June/July 2016. Whilst AMRO consultations could well complement IMF surveillance could they also conflict with them? Could the particular nature of the crisis response have an adverse effect on the abilities of the parties to comply with IMF obligations under for example a Stand-by Arrangement? That such tensions can arise is recognised. Thus, in a Fund paper it is observed: More broadly, different institutional mandates and policies may pose challenges to coordinating program design and monitoring. For instance, program design could be constrained by regional obligations and objectives. Also, as noted above, the relative flexibility of RFAs’ lending policies may not coincide with the Fund’s requirement that its financing should address temporary balance of payments problems where debt is sustainable and there are prospects for market re-access. These discrepancies could lead to situations where one layer of the GFSN may be in a position to lend while the other ­cannot, giving rise to protracted discussions and/or pressure for forbearance in application of lending or other policies from one side or the other.81

Moreover, does the Fund have authority to oversee AMRO consultations as it can with respect to Currency Unions?82 Should the Fund and AMRO enter into a cooperation agreement? Such suggestions have already been made with respect to Regional Financing Arrangements (RFAs) generally—and in this respect of note are the G20 ‘Principles for Cooperation between the IMF and Regional Financing Arrangements’ (2011) which set out the general basis for such a cooperation.83 However, is cooperation the only manner of avoiding conflicts? Could the Fund

81 

See IMF, above n 4, para 22. See further below s III.D. 83  See IMF, above n 4, Box 1. 82 

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endeavour with the cooperation of the relevant parties to ‘annex’/subsume these RFAs under its umbrella albeit under regional terms (including decision-making processes)84 under Article V Section 3? In sum, whilst the CMIM has been described as a financing arrangement, and generally its consultative capacity through AMRO is in the process of developing, it is nevertheless appropriate to consider it within the apparatus of regional normativity, as it can be said to have a normative impact not to mention its future development. The CMIM/AMRO regional cooperation initiative however, even judged on its own terms, needs more development as well as clarification of its relationship with the IMF.

C. Aspects of National Monetary Legislation having a Regional Impact Aspects of national monetary law and institutions having a bearing on regional international monetary relations may be found in different sources, and are the subject of IMF surveillance. The perspective of the national monetary regime here is the extent to which it can lend itself to extraneous factors that gives the State an unfair advantage over a neighbouring State. In this respect of note is the manner in which the monetary and exchange policies respectively are organised in terms of formulation, transparency and accountability. It is not intended here to map the entire relevant domestic legal regimes but rather to highlight some critical features. Of particular note are the national Central Bank regimes and their location within the organisation of government;85 the national frameworks for exchange arrangements and foreign exchange interventions; and finally, the foreign exchange control regimes.86 The foreign exchange control regimes are the subject of regular evaluation under IMF surveillance and not much of a concern since all three come under the IMF Article VIII disciplines. In passing though it may be noted that China allows the settling of accounts with respect to cross-border trade in the currency of a ‘neighbouring country.’87 Additionally, the national capital account controls are informed by the obligations of each member under the

84  I am grateful to Sean Hagan for pointing out one reason why the Fund would have difficulty in this approach is the fact that the decision-making process involved would rest with the IMF. 85  See (1) Bank of Japan Act (Act No 89 of June 18, 1997) Last Amendment: Act No 102 of 2007; Bank of Korea Act, Law No 5491 Promulgated on Dec 31, 1997 Last Amendment: Law No 11380 Promulgated on March 21, 2012: Law of the People’s Republic of China on the People’s Bank of China, December 27, 2003. Source: IMF Central Bank Legislation Database. 86  See Korea: Foreign Exchange Transactions Act (Amended by Act No 9374, Jan. 30, 2009); Japan: Foreign Exchange and Foreign Trade Act (Law number: Act No 228 of 1949; Amendment: Act No 102 of 2005); China—See IMF, Annual Report on Exchange Arrangements and Exchange Control 2015 in country section for details of relevant Chinese legislation. 87  IMF, Annual Report on Exchange Arrangements and Exchange Control 2015.

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trilateral investment agreement between the three countries to allow transfers freely into and out of the countries without delay.88 The domestic monetary regimes are mainly (although not exclusively) set in the national legislation establishing the respective Central Banks. Aspects of the organisation including decision-making processes of Central Banks are the subject of a voluntary IMF Code of Good Practices on Transparency in Monetary and Financial Policies. Member countries of the IMF can volunteer to have the organisation of their Central Banks reviewed by the IMF to reflect upon the degree of compliance with the IMF Code of Good Practices on Transparency in Monetary and Financial Policies. Only Korea seems to have volunteered for its Central Bank to be reviewed by the IMF in 2003. Central Bank operations can also come under the IMF Financial Sector Assessment Program (FSAP). FSAP are mandatory for jurisdictions with systemically important financial sectors,89 every five years.90 China, Korea and Japan fall under this category for Financial System Stability Assessment (FSAA) under the FSAP. Such FSAP fall under Article IV surveillance. The FSAA reports do not focus on the Central Bank specifically as such but can do so. Thus, in the Chinese FSAA of 2011 there is a fleeting observation that ‘the operational autonomy of the central bank and the financial supervisors is crucial.’ This is not the place for a comprehensive examination of the organisation of the respective Central Banks. However, their general ethos and independence in decision-making are of note. First, with respect to the People’s Bank of China its mandate inter alia is to ‘formulate and implement monetary policy, prevent and mitigate financial risks, and maintain financial stability.’91 The objective of monetary policy is elaborated as the maintenance of ‘the stability of the value of the currency and thereby’ the promotion of ‘economic growth.’92 The role of the Central Bank however seems to be mainly to implement monetary policy, albeit on its own.93 The formulation and direction of the monetary policy rests essentially under the leadership of the State Council;94 although the Bank seems to have some discretion in the formulation of policy.95 The Bank is also accountable to the Standing Committee of the National People’s Congress on monetary policy and performance of the financial sector.96 In sum, the Central Bank’s autonomy and independence is set within the political apparatus of the government.

88  See Art 13 of Agreement Among the Government of Japan, the Government of the Republic of Korea and the Government of the People’s Republic of China for the Promotion, Facilitation and Protection of Investment. 89  See IMF, Financial Sector Assessment Program (FSAP) (2016) https://www.imf.org/external/np/ fsap/fssa.aspx. 90  See Koreas FSSA 2014; China FSSA 2011. 91  Art 2 of the Law of the People’s Republic of China on the People’s Bank of China (12/27/2003). 92  ibid, Art 3. 93  ibid, Art 7. 94  See ibid, Arts 2, 5, and 7. 95  ibid, Art 5. 96  ibid, Art 6.

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Second, the purposes of the Bank of Korea are to ‘contribute to the sound ­ evelopment of the national economy by pursuing price stability through the ford mulation and implementation of efficient monetary and credit policies’; by paying ‘attention to financial stability in carrying out its monetary and credit policies.’97 Moreover, the monetary and credit policies of the Bank of Korea are to be ‘­carried out in harmony with the economic policy of the Government insofar as this does not’ impede ‘price stabilization’; taking into account in the implementing of policies ‘the market mechanism’;98 and the ‘public interest and transparency.’99 The independence of the Bank is secured in a number of ways. First and foremost it is expressly so stated.100 Second, members of the Monetary Policy Committee (MPC) of the Bank of Korea charged with monetary policy formulation101 are prohibited from political activity.102 Moreover, whereas the Minister of Strategy and Finance can ask for a reconsideration of a decision by the MPC, the MPC can uphold its decision unless the President intervenes.103 In the same vein the integrity of the monetary policy formulated by MPC is maintained by the requirement that the government is to consult it when formulating any national policies that concern money and credit;104 and the ability of the Governor of the Bank to attend State Council meetings and express his/her opinion on monetary and financial matters.105 In sum, the independence of the Bank and integrity of monetary policy in Korea is well safeguarded, although ultimately it is subject to Presidential veto and control.106 Another important qualification of note in terms of foreign monetary relations is that Bank of Korea only has an advisory role in matters relating to exchange rates and currency market interventions.107 Moreover, it can only act subject to the authorisation of the Minister of Strategy and Finance in certain foreign transactions, in particular including ‘foreign exchange business operations, and the holding of foreign exchange.’108 Finally, the Bank of Japan functions to ensure ‘stability of the financial ­system’;109 ‘achieving price stability, thereby contributing to the sound development of the national economy;’110 and ‘taking into account the fact that currency

97  Art 1 of the Bank of Korea Act, Law No 5491 Promulgated on Dec 31, 1997 Last Amendment: Law No 11380 Promulgated on March 21, 2012. 98  ibid, Art 4. 99  ibid, Art 5. 100  ibid, Art 3: ‘The monetary and credit policy of the Bank of Korea shall be formulated neutrally and implemented autonomously and the independence of the Bank of Korea shall be respected.’ 101  ibid, Art 12. 102  ibid, Art 19. 103  ibid, Art 92. 104  ibid, Art 93. 105  ibid, Art 90. 106  See ibid, Art 27. 107  ibid, Art 83. 108  ibid, Art 82. 109  Art 1 of Bank of Japan Act (Act No 89 of June 18, 1997) Last Amendment: Act No 102 of 2007. 110  ibid, Art 2.

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and monetary control is a component of overall economic policy.’111 The Bank’s autonomy in monetary matters is assured.112 Thus, whilst the Minister of Finance and the Minister of State for Economic and Fiscal Policy may attend and express opinions in the Bank’s Monetary Policy Meetings, the ministers do not have voting rights, and thus do not participate in the voting process. Further, while the ministers may submit policy proposals or request to postpone a vote, they are subject to the Monetary Policy Meeting’s voting procedures, as stipulated in Article 18 of the Bank of Japan Act.113 The Bank is to liaise closely with the government to ensure monetary policy and national economic policy is mutually compatible.114 Interventions in foreign exchange market are decided by the Minister of Finance,115 and the Bank conducts the operations as the agent of the government.116 Further, if the purchase or sale of foreign exchange is ‘for the purpose which the Minister of Finance specifies as constituting cooperation in the field of international finance’, the Bank shall conduct such transactions at the request, or upon the approval, of the Minister of Finance.117 The Bank is accountable to the Japanese Diet;118 and needs to be transparent in its decision-making to the public.119 In sum, whilst the autonomy of the Bank is assured, the Bank needs to maintain close contact and exchange views with the government to ensure that its monetary policy is compatible with national economic policies; and with respect to the buying and selling of foreign exchange for the purpose of international cooperation, subject to governmental request or approval.120 In conclusion, the Central Bank legislation of China, Korea and Japan give a partial picture of the regional and international dimension to monetary relations. In particular, there is no express mention of taking into account IMF advice in monetary policy formulation; and with reference to taking into account regional considerations this is only spelt out specifically, albeit in the context of international cooperation, as a policy objective by the Central Bank of Japan on its ­website,121 although all the Central Banks echo the sentiment enshrined in the IMF Article of Agreement, for the maintenance of stability in the financial and monetary system. In passing here, it will be noted that the term ‘stability’ used variously to describe the objectives of the respective Central Banks can in legal

111 

ibid, Art 4. ibid, Art 3. 113  ibid, Art 19. 114  ibid, Art 4. 115  Art 7(3) of the Foreign Exchange and Foreign Trade Act. 116  Art 40(2) of the Bank of Japan Act. 117  ibid, Art 40. 118  ibid, Art 54. See also Art 45 in relation to the submission to the Minister of Finance and Prime Minister of a statement of operation procedures. It should be noted that the powers of the Prime Minister under the Bank of Japan Act are delegated to Commissioner of the Financial Services Agency (Art 61-2). 119  ibid, Art 3 (2). 120  I am grateful to Mikari Kashima for assisting me in writing this paragraph. 121  See https://www.boj.or.jp/en/intl_finance/outline/index.htm/. 112 

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analysis lend itself to ambiguity and therefore a certain level of latitude and discretion in the understanding of Central Bank objectives. Conspicuously though aspects of exchange rate and foreign exchange interventions seem to involve political direction outside the domain of Central Bank autonomy—normally involving the Ministries of Finance.122 Generally the parameters within which the intervention can take place is not spelt out other than general statements, for example, in the case of Japan the objective of the intervention policy being the stabilising of the value of the Yen;123 and in the case of China ‘with a view to keeping the RMB exchange rate stable at an adaptive and equilibrium level based on market supply and demand with reference to a b ­ asket of ­currencies to preserve the stability of the Chinese economy and financial markets.’124 Japan and Korea have de jure free floating exchange rates, although both intervene in order to manage disorderly conditions in the market.125 On the other hand, China maintains a de jure managed floating exchange rate arrangement. In some measure, thus, the exchange rate regimes between the three are informed by the market. In conclusion, circumstances in which currency intervention takes place including decisions on the amount of a State’s currency reserves, seem not be placed within some form of legal parameters and good governance focus126—although economic analysis has more to shed light on the underlying objectives. Moreover, whilst the sensitive nature of these functions may well prove to be challenging there is a case here for some basic disciplines to be set at the domestic level— after all exchange rates are a description of a relationship between currencies and therefore not totally the domain of domestic monetary sovereignty, at any rate any more, and therefore come under focus in IMF surveillance.127

D.  How is the IMF and its Law Adapted to Regionalism? In world trade there is much ado about the compatibility of the multilateral trading system and regional trading arrangements. This interface and the factors that go into a consideration of the relationship between trade liberalisation at the regional and multilateral levels are encapsulated in Article XXIV General Agreement on Tariffs and Trade (GATT) 1994 and Article V of the General Agreement on Trade in Services (GATS). Essentially, against the background of the

122  Japan: Ministry of Finance; Korea: Ministry of Strategy and Finance; and China: The Ministry of the People’s Republic of China. 123 See https://www.boj.or.jp/en/intl_finance/outline/index.htm/. See also Japanese Foreign Exchange Act. 124 ibid. 125  See IMF, Annual Report on Exchange Arrangements and Exchange Control 2015. 126  Note: Japan’s Ministry of Finance does publish an account of its foreign exchange intervention ex post on a regular basis. 127  See IMF Guidance Note For Surveillance Under Article IV Consultations (2015) paras 67 to 69.

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­ ost-favoured-nation standard, the conditions for regional integration in trade m prohibit such arrangements if they do not cover substantially all trade; and if they result in increasing the burden of third parties, as a result of the arrangement. These disciplines are subject to a form of a review process, and can also be the subject of adjudication in the WTO dispute settlement process. Generally, there are no such equivalent disciplines as for example in Article XXIV of GATT 1994 for the setting up of regional monetary/financial arrangements under IMF law, although the arrangements may well be the subject of consideration under individual member IMF surveillance. States are free to engage in monetary cooperation as between themselves in whatever form and degree. Moreover, this liberal approach is reinforced, if under customary international law there is no duty ‘not to harm the monetary assets of other states.’128 In the circumstances, whereas the WTO disciplines on regional integration have their own shortcomings they nevertheless could provide a basis for sharpening the disciplines in the IMF with respect to monetary integration. This despite the fact that one important difference between the IMF and the WTO is that there is no general mostfavoured-nation standard in the monetary sphere. However, some constraints may be observed. First, the regional availability of liquidity on a discriminatory basis does not violate any obligation of an IMF member country under the Articles of Agreement of the IMF, as the Articles of Agreement do not expressly prohibit such discriminatory facilities as such. However, such discriminatory arrangements could hinder the Fund’s ability to: To give confidence to members by making the general resources of the Fund temporarily available to them under adequate safeguards, thus providing them with opportunity to correct maladjustments in their balance of payments without resorting to measures destructive of national or international prosperity.

Second, members may enter into co-operative arrangements with respect to their exchange rates.129 However, such arrangements must not result in the manipulation of ‘exchange rates or the international monetary system in order to prevent effective balance of payments or to gain an unfair competitive advantage over other members.’130 Nor should such arrangements partake of ‘discriminatory currency arrangements or multiple currency practices.’131 Third, regional financial arrangements concerned with reserve assets132 involve an obligation to collaborate with the Fund and other members to ensure that the policies of the member with respect to reserve assets shall be consistent with the objectives of promoting better international surveillance of 128 

See Gold, above n 46. Art IV s 2 (b) (ii) of the IMF Articles of Agreement. 130  ibid, Art IV s 1 (iii). 131  ibid, Art VIII s (III). Note the conversion of currencies within the region without the dollar is not available for other currencies. 132  Assuming regional financial arrangements can be assimilated to a member’s reserve assets. 129 

Is there a Financial and Normative Framework 143 i­nternational liquidity and making the special drawing right the principal reserve asset in the international monetary system.133

Finally, regional monetary cooperation enhances regional trade. Stability in exchange rates and a common currency reduces transaction costs, and promotes regional trade. The Fund’s objectives are to pursue the ‘expansion and balanced growth of international trade.’134 The Fund is obligated to cooperate ‘within the terms’ of its agreement with other international organisations such as the WTO.135 In such circumstances can the WTO disciplines on regional trade agreements be grafted into the IMF and thus apply to regional monetary/financial cooperation agreements? Could monetary/financial cooperation arrangements, if proven to result in trade diversion, and/or the imposition of higher burdens in international trade on third parties, raise questions within the Fund? This may seem at first very controversial but a measured response would depend on how the graft is undertaken and what is meant by questions raised. Certainly, the expectations arising from the disciplines can raise questions in the operations of the Fund. Thus, Guidelines approved under an IMF Executive Board decision state: The Fund, given its responsibilities in the rates, can contribute to assessing issues of coherence between macroeconomic and trade policies. The Fund can also contribute to greater policy coherence by taking into account in its work the concerns of the WTO in the trade area.136

In terms of obligations—to the extent that currency manipulation/discriminatory currency practices result in trade diversion and/or more onerous trade conditions on third parties before the establishment of the monetary cooperation agreement, there would be questions of violation of IMF obligations. This analysis is reinforced by the obligation under Article XV of GATT 1994 that GATT Contracting parties ‘shall not, by exchange action, frustrate’ the intentions of the provisions of GATT 1994. In sum, the link between monetary and trade policies arguably informs the Law of the Fund in the manner in which it manages regional monetary integration. There is, it is suggested, a normative aspect to monetary integration, somewhat in the same vein as there is one in world trade law to regional trade integration arrangements. Although, as mentioned earlier, there are no specific provisions in the IMF Articles of Agreement that refer to the conditions for regional monetary cooperation as such. On the other hand, is there a positive obligation to promote regional monetary cooperation where this is appropriate? And does the Fund have a mandate

133 

Art VIII s 7 of the IMF Articles of Agreement. Art 1. 135 Art X of the IMF Articles of Agreement and The Agreement Between the IMF and the WTO 1996. 136  EB Decision No A-9786-(93/20) as amended. 134 

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to ­oversee the implications of regional monetary developments in terms of the interests of the respective members of the regional community? With reference to the former question it will be noted first that the Fund does accommodate regional monetary cooperative arrangements for exchange rate and monetary policy alignment.137 However, it could be difficult to attribute a positive obligation to the Fund to promote regional monetary cooperation. The Fund would need to respect the monetary sovereignty of its members. Moreover, it cannot anticipate the kind and degree of monetary cooperation necessary in any given region. ‘Promotion’ however does fall short of ‘obliging’ members. Thus, a mandate to facilitate upon request could be implicit where regional integration facilitates ‘the expansion and balanced growth of international trade.’138 In the case of Brexit the IMF did point out the consequences of a UK exit from the EU. Moreover, the Fund does have a wide mandate ‘to oversee the international monetary system in order to ensure its effective operation’ including compliance with Article IV Section 1 obligations (which include the obligation to avoid manipulating exchange rates). This mandate has been interpreted by the IMF to allow it to ‘to engage in discussions with members in those cases where the conduct of their domestic policies, even though it may be consistent with their obligations to promote domestic stability, were having adverse spill over effects that were systemic.’139 Whilst, this empowerment to engage in consultations is strictly not articulated in a regional context, it would appear to be wide enough to embrace spill overs within a regional setting. Moreover, it is a procedural requirement to engage in consultations with the Fund, and does not impose on the member itself ‘any obligation to change’ its policies in the light of the consultations.140 Hence, the observation by the Chairman of the Executive Board: Directors considered it important to encourage members to implement policies conducive to the effective operation of the international monetary system. They welcomed the clarification in the new Decision that, to the extent that a member is promoting its own stability, it cannot be required to change its policies to better support the effective operation of the international monetary system.141

However, be that as it may, Fund guidance on surveillance gives directions for regional orientation of the consultations where spill overs have a regional impact.142 In sum, the Fund has the mandate to encourage regional cooperation if

137  See for example Art IV, Section 2 (b). Examples of such arrangements include Central African Economic and Monetary Union; West African Economic and Monetary Union; Eastern Caribbean Currency Union; and Euro-Area. 138  See Art 1 (ii). 139  Hagan, above n 47, 375–77. See also EB Decision No15203-(12/72), 18 July 2012. 140  Hagan, ibid. 141 See Chairman’s Summing Up—Modernizing the Legal Framework for Surveillance— An ­Integrated Surveillance Decision Executive Board Meeting 12/72, 18 July 2012. IMF Selected ­Decisions (2013). 142 See for example paras 12, 15, 17, 20 and 21 of IMF Guidance Note For Surveillance Under Article IV Consultations 2012.

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it chooses to do so, in particular upon a request although it cannot impose on the member an obligation to co-operate regionally. Thus, in an important Executive Board paper it is stated: Moreover, it would be open for the Fund to provide technical assistance to a regional reserve pooling arrangement with respect to the design of the conditionality that would be applied in the event of the use of the pool’s resources by a member of the pool.143

The current framework for IMF surveillance through which the IMF can encourage regional co-operation or indeed involve itself with regional developments that implicate the interests of a particular member within a certain region, is set out in Executive Board Decision on Bilateral and Multilateral Surveillance 2012.144 This EB Decision, whilst not mandating regional surveillance as such under Article IV, can be read as permitting in individual country surveillance exercises, regional considerations to be taken into account. For example, it is stated therein: ‘The EB Decision integrates bilateral and multilateral surveillance and in so doing it casts a regional focus as multilateral surveillance would embrace a regional focus.’ The Fund defines its multilateral framework as incorporating ‘relevant aspects of the global and regional economic and financial environment, including exchange rates, international capital market conditions, and key linkages among members.’145 In sum, the EB Decision encourages members ‘to be mindful of the impact’ of their policies on the ‘international monetary system’.146 The international monetary system encompasses the regional monetary environment. The EB Decision also refers to its application to Currency Unions.147 Could some of the provisions of the EB Decision concerned with Currency Unions also apply to Regional Financial/Monetary Integration Arrangements falling short of Currency Unions—in particular the edict that the Fund will assess whether relevant policies implemented at the level of the currency union (including exchange rate and monetary policies) and at the level of members are promoting the balance of payments and domestic stability of the union and will advise on policy adjustments necessary for this purpose.148

It may be possible to argue this for the following two reasons. First, the decision is in pari materia. Second, that it is a reasonable inference to draw that it applies to lesser forms of financial/monetary integration given that the underlying principle with respect to Currency Unions is that the Fund retains the authority to oversee.

143 

IMF Legal Department, above n 5. Decision No 15203-(12/72) 18 July 2012 in Selected Decisions of the IMF (2013). 145 Para 16 Decision No 15203-(12/72). See also IMF Guidance Note For Surveillance Under Article IV Consultations 2012 paras 12, 15, 17, 20 and 21. 146 See also para 23 Decision No 15203-(12/72) which encourages members to have policies ‘conducive to the effective operation of the international monetary system.’ See also para 26 which refers to ‘spillover effects’ of a member’s policies falling under discussion with the IMF. 147  See para 8 of the EB Decision No 15203-(12/72). 148 ibid. 144 

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This concern is equally of relevance in relation to lesser forms of integration. In sum, it could be argued that the Fund has the mandate to oversee arrangements falling short of a Currency Union, including regionally formulated policy advice, in a monetary/financial set up falling short of a Currency Union. Can this set of law and practice be interpreted to implicate the IMF in regional monetary tensions—in policing good neighbourly monetary relations specifically? The mandate and the writing on the wall is there. Moreover, surveillance has to take place taking into account the member’s circumstances. A member’s circumstance includes its regional setting. Given this analysis does the practice of IMF surveillance of the States in NEA, in particular economic analysis, lead to a conclusion that this mandate for a regional focus is being fully realised? Generally it would seem that IMF Article IV surveillance exercises of the respective countries in the region have not involved extensive and in depth analysis of economic policies from a regional context.149 However, the Fund has, albeit relatively recently, started to engage in a ‘regional’ focus outside Article IV surveillance, resulting in its publications titled Regional Economic Outlook—and specifically in the context of NEA the Regional Economic Outlook (REO): Asia and Pacific—published annually since 2005. These comprise of economic analysis of particular regions, including implications of regional spill overs.150 The publications however specifically make clear that ‘projections and policy considerations are those of the IMF staff and do not necessarily represent the views of the IMF, its Executive Board, or IMF Management.’ Moreover, there is a query here as to whether the focus of REOs partakes of area studies or regional integration within geographical areas. In sum, this enterprise whilst being more regionally focussed than Article IV exercises, would carry less weight than the deliberations under Article IV surveillance. The Fund’s approach to Article IV surveillance seems somewhat similar to its approach to according access to its resources. Thus, there is qualified recognition that the Fund ‘should be prepared to provide access above the normal limits in cases where the member’s problems have regional or systemic implications, when the other criteria are met.’151 The Fund however has not set up specifically regionally-based facilities to assist in balance of payments problems. Perhaps as ­suggested earlier, by subsuming regional financial arrangements into its architecture, it could achieve this result. In conclusion, the Fund does have a regional dimension to its outlook, and does take regional economic spill overs into account. The degree to which it does this

149  This observation is based on recent IMF surveillance exercises of the respective countries in NEA. 150 See for example Regional Economic Outlook: Asia and Pacific—Building on Asia’s Strength’s during Turbulent Times, above n 11, ch 3. 151  Summing Up by the Acting Chair—Access Policy in Capital Account Crises Executive Board Meeting 02/94, 6 September 2002. See also the IMF’s Precautionary and Liquidity Line which refers to ‘heightened regional or global stress conditions’. See IMF Fact Sheet 30 March 2016.

What is the Ethical Discourse on Monetary Relations?  147

however in all its spheres of operations is a matter of judgement. The Fund can through its member focus extend its ambit to the region of the member in a more rigorous and systematic manner. Some further clarification here could h ­ owever be of value in sharpening the regional focus. The Fund’s regional perspective however, is not NEA specific, in so far as it is concerned with Asia and Pacific region.

IV.  What is the Ethical Discourse on Monetary Relations? Engagement in ethical considerations, in particular justice discourse, is important and relevant at a regional level as it is at a multilateral level. Regionalism however is further underpinned by the edicts associated with good neighbourliness. There has been some level of discussion here152 although there is generally a dearth of insight from a justice perspective. Doubtless this is because of the technical complexity of the subject. Few international economic law scholars are monetary specialists. There are fewer theorists in the international economic law sphere. Moreover, the received macroeconomic approach to some of the issues obfuscates where exactly in individual human terms the benefits and burdens of monetary policy ultimately rests. Justice discourse calls for contextualisation of monetary problems at a micro level. Indeed, justice is better served when it is contextualised. The recent exploration in the IMF of the full economic nature of interconnectedness post the 2008 financial crisis is a useful torch towards realising a more contextualised approach to normative inter-se monetary relations. However, an exclusively economic approach may fail to shed light on the welfare costs, and the full dimensions of social justice implicated in the issues. In this context, it is to be noted that the IMF has taken cognisance of the need to address the gender imbalance in its Executive Board (the highest decision-making body of the IMF) r­ecognising that gender diversity would lead to ‘a more effective IMF.’153 Whilst women per se may not necessarily bring a more moral perspective to ­decision-making in the IMF it is also possible that they may enhance the prospects of such an outlook.154 In the same vein, an exclusively State perspective obscures the human impact of State monetary relations, preventing

152  See, for example, Frank J Garcia, ‘Evaluating IMF Crisis Prevention as a Matter of Global Justice’ (2008) 14 ILSA Journal of International and Comparative Law 467–76. 153 See IMF Executive Board’s First Report to the Board of Governors on Gender Diversity in the Executive Board (12 July 2016) http://www.imf.org/en/News/Articles/2016/07/12/19/40/ PR16335-IMF-Executive-Boards-First-Report-to-the-Board-of-Governors-on-Gender-Diversity. 154 See for example Cindy May, ‘Are Men Less Moral Than Women? Studies Show Ethical Standards’ The Huffington Post (19 June 2012) http://www.huffingtonpost.com/2012/06/19/men-lessmoral-women-ethical-standards_n_1609426.html.

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the development of monetary law to reflect better the human condition—not to mention a more cosmopolitan and human rights approach to the development of monetary relations.155 In sum, the justice dimension to monetary relations calls for a radically different methodology in the manner of considering normativity in monetary relations, cutting across the layers of actors, taking an interdisciplinary and contextualised approach. From this perspective what kind of justice is implicated? This is to some extent informed by the nature of the monetary problems to be addressed. The principal monetary problems that have called for regional monetary cooperation in NEA relate to ‘competitive devaluation’, availability of liquidity in an emergency, and the related quest for an international reserve currency. Competitive devaluation involves State responsibility towards its residents, as much as inter-state responsibility. The State manipulates conditions which give a competitive advantage to its export sector. However, for certain other sectors within its economy reliant on imports, there is a negative impact. Similarly, there are negative consequences for the consumers reliant upon imported consumer goods and services; and foreign remittances, made for example by migrant workers to their home countries, become costlier. However, the value of foreign assets held by residents on the other hand appreciates. Cost-benefit analysis could to some extent reflect an overall benefit to the economy as a whole, at some time, along with trickle down positive effects generally. However, be that as it may, there is here a circumstance that reflects arbitrary distribution of benefits and burdens amongst residents of the State; not to mention welfare costs on some, for example the sick dependent on vital lifesaving imported medicine. Herein is a circumstance where Rawls’ distributive justice analysis has a bearing.156 Thus, to borrow one of Rawls’s analytical tools, a ‘behind the veil of ignorance’ retrospective, would call for, in terms of substantive justice, an egalitarian distribution of the costs and benefits, consequent upon an engineered revaluation of the domestic currency exchange rate; and in accordance with Rawls’ differential principle some positive discrimination in favour of the most disadvantaged from the currency devaluation. Competitive devaluation also involves an unfair advantage vis-à-vis another State and its residents and therefore raises questions of unjust enrichment. In terms of procedural justice, the decision-making process of the valuation of the currency needs to be procedurally fair—conforming to due process, and to the extent possible, transparent. This means the decision to intervene in the market and/or devalue needs to be justified, lend itself to accountability; and be

155  See, for example in, the sphere of trade Ernst-Ulrich Petersmann, ‘International Economic Law in the 21st Century: Need for Stronger “Democratic Ownership” and Cosmopolitan Reforms’ (1 July 2012) EUI Working Papers LAW no 2012/17, available at SSRN: http://ssrn.com/abstract=2115464 or http:// dx.doi.org/10.2139/ssrn.2115464. 156  See John Rawls, A Theory of Justice (Cambridge MA, The Belknap Press of Harvard University Press, Revised edition 1999).

What is the Ethical Discourse on Monetary Relations?  149

t­ ransparent albeit post facto.157 In this context, decisions about intervening in the currency market where these are the business of the Finance Ministry and not that of the Central Bank imply that such decisions are more politicised than otherwise. Of course, the nature of the intervention and decision-making prior to its being carried out needs to be confidential. But within the framework of such a constraint, it is still possible that there is a process of decision with a paper trail, such that the decision can be scrutinised post facto; and that the decision and interventions in the currency markets are rendered transparent post facto, barring exceptional national security considerations. There is also a question of individual responsibility to be noted. To what extent for example is there an obligation on those who have made gains through the exchange rate change to forego the advantage bestowed upon them, for e­ xample, by increasing the price of exports commensurate with the exchange rate margin? Or to redistribute it to those who have suffered a burden from the change? Availability of liquidity for a financial emergency can be from a variety of sources, both internal, for example through the stocking up of large reserve currency surpluses, and external, for instance through the IMF, or bilateral or regionally anchored swap arrangements. Given that there is no unfettered right to hard currency as such,158 but that some of the hard currency may be attributed to arbitrary distribution of international resources, and there is an ­emergency ­situation—how should the allocative decisions be framed? Not long ago this author considered necessity in the sphere of International Economic Law generally, observing as follows: National and international responses to a state of necessity constitute resources for international distribution in the framework of international distributive justice. Therefore, it is necessary to revert to a Rawlsian international original position behind a veil of ignorance.159 Foregoing compliance with international responsibility, engaging in the collective acts of responses to states of necessity, and responding individually to such circumstances—all involve in some form or another the distribution of resources. Here all the participants would set a framework for responding to states of necessity knowing that a state of necessity could inflict them at some point. Moreover, their capacity to respond would be informed by their particular states of endowment. Furthermore, the obligation to respond will also be informed by the operation of Rawl’s differential principle160—in inviting differential treatment in circumstances of necessity where such response would assist the least disadvantaged in society.161

157 

As for example intervention reports ex post facto in Japan. See above n 126. See, for example, Garcia, above n 152, 470. 159  John Rawls, A Theory of Justice (Cambridge MA, Belknap Press of Harvard University Press, 1971); and see also for example Franck Garcia, ‘Global Justice and the Bretton Woods Institutions’ (2007) 10(3) Journal of International Economic Law 461–81. 160  Garcia, ibid. 161  Asif H Qureshi ‘A Necessity Paradigm of “Necessity” in International Economic Law’ (2010) 41 Netherlands Yearbook of International Law 99–136. Translated into Chinese and published in Chinese in (2012) 19(4) Journal of International Economic Law 15–49. 158 

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In sum, the international allocation of reserve currency in times of necessity needs to be tempered with considerations of distributive justice. Moreover, the justice basis to respond is stronger at a regional level. The economies of States within a region are more intertwined and therefore more sensitive to each other. And there is a ‘good neighbour’ case here too founded on morality and humanity. Internally within a State, unilateral measures involving the holding of large amounts of reserves as an insurance policy to deal with circumstances of financial crisis, calls for some attention. These are the subject of consultations in IMF surveillance exercises although from an economic perspective.162 Thus, the consequences of such large reserves have been pointed out as follows: A number of emerging market countries and, to a lesser extent, advanced economies have accumulated an unprecedented volume of international reserves, either as a goal in itself (e.g. as a cushion against future uncertainties) or as a result of other policies domestic or external (eg to limit exchange rate appreciation). Partly as a result, emerging markets have become net exporters of capital to advanced economies, which appears contrary to longer-term priorities for economic development. Easy availability of financing has contributed to financial imbalances by postponing needed adjustment, including domestic policies to deal with mounting fiscal imbalances. Reserve balances have remained concentrated in a small number of currencies, predominantly the US dollar. Some diversification of reserves is taking place, but the question is being raised of the need for a multilateral way of facilitating such diversification to avoid the risk that expectations of moves by official reserve holders may trigger destabilizing shifts in private portfolios. It is important that such issues be properly dealt with.163

In NEA the amounts involved are large and their allocation for the purpose of dealing with a currency crisis is in competition with other national priorities. Such amounts could also be considered potentially of an offensive nature and not just defensive. This internal distribution of national resources as reserves raises both substantive and procedural questions of distributive justice in relation to the residents of the State. Should there not be some open discussion in representative domestic fori about the allocation of the level of the amount of reserves to be ­allocated for this purpose? In sum, there is a case founded on morality, humanity and justice at any rate at the regional level as between the members of the region that calls for co-operative responses in times of financial crisis through the provision of some form of liquidity. In the same vein there is a justice discourse internally within the State, with respect to the internal strategy of allocating vast reserves as a safeguard to a financial crisis. The Fund has the mandate under ­Article VIII, Section 7 to conduct surveillance over a member’s policies on reserve assets.164 However, it has yet to clarify what guidance it needs to provide members

162  See para 67 of IMF Guidance Note for Surveillance Under Article IV Consultations (2015). See also IMF Guidance note on the assessment of reserve adequacy and related considerations (2016). 163  See Palais-Royal Initiative: Reform of the International Monetary System: A Cooperative Reform of the International Monetary System: A Cooperative Approach for the Twenty First Century. 164  See IMF Legal Department, above n 5, para 26.

What is the Ethical Discourse on Monetary Relations?  151

on this question. This guidance cannot be formulated purely in terms of economic considerations alone. Finally, within the NEA regional setting there is, amongst the States in NEA, a certain level of jockeying to establish the respective national currency, as an international reserve currency/freely usable currency. Two important strands of questions are raised here. First, in the absence of a regional currency union, what should be the orderly and fair conditions within which this quest for currency power be set against (the fair competition question)?165 Second, what kind of responsibilities should attach to the issuing State of a currency that has an international reserve currency status (the responsibility question)? Is there an ethical code that should attach to a currency once it acquires an international reserve currency status, which at the least curbs ‘abuse of power’? Should the ethical code include distributive justice concerns to the extent that the international reserve currency status is attributable to arbitrary distribution of international resources, as Franc Garcia has suggested?166 International reserve currencies are necessary for the functioning of the international economic system, in the absence of the existence of an international currency. The conditions for acquiring international reserve currency status are in some measure informed by the criteria set for these by the IMF;167 and include for instance such considerations as the country’s level of exports and the extent to which it is freely usable. These conditions however are economic in nature and command legitimacy as such for this reason. The costs and benefits to the issuer of the currency have been variously described.168 At the non-State level the national banking sector has a built-in comparative advantage given the ready access to the national currency;169 and generally national foreign business enjoys lower exchange risks as do nationals when abroad.170 At the level of the State, there is the benefit of seigniorage accruing to the national economy; greater autonomy in national policy-making given fewer constraints arising from balance of payments pressures with the ready access to the national/international currency; and finally the State has enhanced international reputation and capacity to influence other States.171 On the ­downside, one cost of particular note is that the demand for the currency puts

165  Prior to this question there is of course the question whether States aspiring to be issuers of an international reserve currency should reflect at the regional level about the provision of a common currency, which could more immediately make a difference to the economic prosperity in the region. 166  Garcia, above n 152. 167  See IMF Policy Paper: Review of the Method of Valuation of the SDR 2015. 168  For a very clear description see for example Benjamin J Cohen, Currency Power: ­Understanding Monetary Rivalry (Princeton, Princeton University Press, 2015) ch 1. The author adumbrates the ­benefits under the following categories: transaction costs; seigniorage; macroeconomic flexibility; ­leverage and reputation. The costs are categorised as reputation; appreciation; external constraints; and policy responsibility. 169  Cohen, ibid, 20. 170 ibid. 171 ibid.

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pressure on the currency to appreciate and be overvalued.172 Moreover, with the internationalisation of the currency comes also pressure to engage responsibly in monetary relations.173 Over all it seems there are considerable advantages for the issuing State174—the international reserve currency country acquires a ‘built-in advantage in the supply’ of this sought after currency.175 Both the fair competition and the responsibility questions are in some measure inter alia grounded in distributive justice. First, fair access considerations operate in terms of the equal/unequal opportunity of access to a fair value of national currency. Exchange rate manipulation disrupts this equality of opportunity of a fair exchange rate. Every State is equally entitled to a means of exchange that reflects its relative value that is not unfairly distorted. This is distinct from contending that every State is entitled to a certain share of hard currency. In the absence of a universal means of exchange, behind Rawls’ ‘veil of ignorance’ this is the second best that all States would agree to. Depriving a State deliberately of the fair relative value of its currency is unjust. Moreover, if the States are competitors and the exchange rate manipulation gives the residents of one State (including the State itself and its economy) a competitive advantage over the residents and economy of another State, questions of rectificatory justice176 as between the two States also arise, on the premise that every State enjoys equal opportunity of access to a fair value of its currency. To realise this, for example, an affected State could legislate to enable its residents to seek compensation from the responsible State the erosion of their asset values arising from a deliberately distorted relative exchange rate value—leaving aside questions of proof. Although the point here has been framed in terms of the opportunity for realising a fair value of a national currency, the same considerations are equally in point in the context of a quest for acquiring an international reserve currency status. Second, generally as Frank Garcia aptly points out, ‘certain currencies are considered hard, and others are not necessarily creates inequality in the distribution of trade currencies.’177 This inequality, where it is a consequence of and attributable to the arbitrary distribution of resources, is the subject of distributive justice. This is equally so in a regional context. Moreover, given that there are indeed benefits to an issuing State of an international reserve currency, there is a case that those b ­ enefits should be accompanied by some measure of responsibility, in ensuring stability of the international monetary system. At first blush this suggestion may seem naïve, but in reality, given that acquiring an international reserve currency status is also about perceptions of a currency, and the issuing

172 ibid. 173 ibid. 174 ibid. 175 

Garcia, above n 152, 469. See for example G Collste, Global Rectificatory Justice (London, Palgrave Macmillan, 2015). 177  Garcia, above n 152, 469. 176 

What is the Ethical Discourse on Monetary Relations?  153

State’s behaviour, users of the currency already engage in the currency with a set of expectations. Articulating those expectations in a code for reserve currencies is not a quantum leap, and is in fact conducive to an orderly international monetary framework. Indeed, it is recognised that the Fund has a mandate to ‘discuss with the member the manner in which their policies are directed towards the achievement of better international liquidity, and changes in policy that may be necessary for this purpose.’178 Would not a sudden massive depreciation of the currency call for concern? Leaving aside however legality, what of the response that the issuing country’s currency has an international currency status merely as a consequence of a spill over of sound economic policies and consequential growth, and therefore should not be accompanied by any responsibilities over and above those currently found in IMF law?179 This is indeed a persuasive argument that deserves careful consideration. However, can the acquisition of the status of an international reserve currency be exclusively attributable to a country’s own sound economic policies and growth? Should the availability of an export market by third countries not command some stake in the calculation of the export performance? Exports are informed by the competitive nature of a country’s exports. But they are also informed by the availability of a market provided externally.180 Finally, however the currency status has been acquired, is it a morally defensible argument to proclaim complete non-responsibility? After all what is being proposed is not the redistribution of resources if that is not justified on grounds of distributive justice, but rather merely some measure of responsibility in the manner in which the currency is subsequently managed once it acquires its international status. Even in the distributive justice world of Rawls the equality of opportunity conceded does not extend to using realised assets through that opportunity in a manner destructive of the community at large. In sum, reserve currency status is determined in the ‘law of the jungle’, and once acquired it seems the ‘crowned lion’ is not accountable for the manner of its behaviour, self-aggrandisement or hegemonic tendencies. There is a case therefore to articulate a special code of conduct for international reserve currencies that takes in particular the responsibility questions on board. Indeed, an obligation to have due regard may be read in Article IV of the IMF Articles of

178 

IMF Legal Department, above n 5, para 26. I am grateful to Mr Rhee Chang Young for drawing this argument to my attention. In the sphere of international taxation, in the discourse on attributing different taxation rights, as between a residence and a source State, the argument has been put forward that the right to tax in the case of profits from the international sale of goods and services needs to be apportioned as between the source and residence States, on grounds of equity, to the source country also where the sales have taken place, for its provision of the market for the exports. See Klaus Vogel, ‘Worldwide vs source taxation of income—A review and re-evaluation of arguments’ (1988) 16(8/9) Intertax 216–29. 179 

180 

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­Agreement.181 The latter question could focus at the manner of any future fundamental changes in the arrangements of currency rates; interventions in the market; and the manner of the applications of the ‘national security exception’ with respect to the currency.

V.  Instilling Disciplines in Transmission Channels There is much economic analysis on the causes of spill overs particularly of late; and thus IMF Article IV surveillance reports now refer to RAM (Risk Assessment Matrix). It is however difficult from these reports alone to discern a list of policy instruments which lend themselves to deliberately impacting negatively on another State, so as to gain an unfair advantage. The obvious example of course is exchange rate policy. But doubtless economic analysis could well shed light on other monetary instruments. The challenge is to ensure that such policy instruments at their inception are conditioned with appropriate disciplines. Surveillance can achieve this to some extent although it is somewhat an ex post exercise. Identifying the appropriate ex ante conditions wherein the relevant decisions are made is part of the process of instilling appropriate disciplines in such transmission channels. Thus, the Fund’s focus on the independence of the Central Bank is part of an endeavour to ensure that decisions made by the Central Bank involve an appreciation of the appropriate disciplines that need to be taken into account. Clarity in the disciplines against the backdrop of which such decisions need to be made is another aspect of instilling disciplines at the right time. Information and analytical tools ensure there is prior knowledge of the consequences of particular actions. Regular regional consultations between relevant decision-makers such as Central Bank Governors serve to ensure some level of concern for regional partners. In sum, there is a case for a greater effort to address the challenge of instilling appropriate disciplines in relevant channels of transmission.

VI. Conclusion NEA comprises sufficiently of a cohesive cluster of States with interconnected issues that call for a regional perspective to the monetary relations within the NEA. However, the impetus for such a perspective within NEA is at the moment wavering and at the level of the IMF is not fully focused. Generally, the normative framework for the management of regional monetary relations in NEA is soft and fragmented although not NEA specific. On the whole the Fund’s legal apparatus is 181 

Observation made by Sean Hagan on 16 August 2016.

Conclusion 155

adapted to a regional focus at any rate at an operational level. However, there may be a case for some tweaking of the surveillance decision of the Executive Board so that a regional focus is not missed as between the bilateral and multilateral integration of the current focus. There is also a case for clarity as to precisely the extent to which the Fund should be involved in regionalism. The Fund should be involved otherwise the international monetary system is in danger of fragmentation. Some clarity on the normative framework as it applies to regions is needed, as is the inculcation of ‘good neighbour’ considerations.

6 International Legal Aspects of Free Trade Agreements in North East Asia ‘A State’s freedom to discriminate in international trade is no longer absolute and cannot be so.’ Asif H Qureshi

I. Introduction Since around 2002, there has been a steady increase in Free Trade Agreements (FTAs) in East Asia, in particular North East Asia (NEA). China, Korea and Japan have all been actively engaged in negotiating and agreeing FTAs with third ­countries outside NEA, as well as of late in some measure as between the three States. The reasons for such a development have been attributed1 to a variety of considerations including in particular the failure of the multilateral negotiations under the Doha Round; the export-oriented economies of the region necessitating the spearheading of FTA strategies to facilitate market access; the need to create conducive foreign economic environments for both trade and investment; the growing awareness of the economic and political benefits of integrating the economies of NEA against the background of existing market-driven economic integration generally in Asia; the lessons from both the 1997–98 Asian financial crisis and the 2008 global financial crisis; and finally economic integration developments in other parts of the world, in particular North America and Europe. Underlying this proliferation of preferential arrangements has been the firm belief that engagement in them is inherent in State sovereignty, and the State’s almost absolute discretion in designing such arrangements. In this chapter, however, a normative approach to this Westphalian spirit of FTAs is explored. A contextualised approach to International Law calls for such an appraisal.

1  See for example M Kawai and G Wignaraja, ‘Asian FTAs: Trends and Challenges’ ADBI Working Paper Series No 144 (2009).

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Currently Japan has some 15 preferential trade agreements in force with ­ ustralia, Brunei Darussalam, Chile, India, Indonesia, Malaysia, Mexico, ­Mongolia, A Peru, Philippines, Singapore, Switzerland, Thailand, Viet Nam, and ASEAN ­member countries respectively.2 The first Japanese preferential arrangement came into effect in 2002 with Singapore. Japan is also currently negotiating preferential arrangements with Canada, Colombia, EU, Gulf Cooperation ­Council, Korea and Turkey.3 In March 2018 it will sign in Chile the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP) formerly known as the Trans-Pacific Partnership (TPP) with 10 other countries.4 China is party to 16 preferential arrangements viz ASEAN; Asia-Pacific region; Australia; Chile; Costa Rica; Hong Kong; Iceland; Korea; Macao; New Zealand; Pakistan; Peru; Singapore; Switzerland; Taipei; and Thailand.5 The earliest post-WTO preferential arrangements in effect were in 2003 viz Hong Kong and Thailand. China has also signed an FTA with Georgia but this has not yet entered into force. Currently China is negotiating preferential arrangements with the Gulf Cooperation Council; Maldives; ­Norway; Southern African Customs Union; and Sri Lanka.6 Korea is party to some 16 preferential arrangements viz ASEAN; Asia-Pacific; Australia; India; New Zealand; People’s Republic of China; Canada; Chile; Colombia; European Free Trade Association; European Union; Peru; Singapore; Turkey; United States;7 and Viet Nam.8 Korea’s first preferential arrangement post-WTO in force was with Chile in 2004. It is currently negotiating for preferential arrangements with Central America; Ecuador; Eurasian Economic Union; Gulf Cooperation Council; Indonesia; Israel; Japan; Mexico.9 Finally, Korea, China and Japan are also negotiating as between themselves a trilateral preferential arrangement viz the China-Japan-Korea Free Trade Agreement (CKJ FTA); and along with others10 the Regional Comprehensive Economic Partnership (RCEP) agreement. Additionally, Japan makes available under the Generalised System of Preferences preferential market access to 143 countries/ territories including 47 least developed States (LDCs).11 China grants unilateral

2  See WTO: Japan Trade Policy Review Secretariat Report (2017) https://www.wto.org/english/ tratop_e/tpr_e/s351_e.pdf. 3 See Asian Development Bank Free Trade data base: https://aric.adb.org/fta-country. See also WTO data base on regional integration agreements notified to it https://www.wto.org/english/ tratop_e/region_e/rta_participation_map_e.htm. 4  Australia, Brunei, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, and ­Vietnam. See report in for example https://www.theguardian.com/world/2018/jan/24/trans-pacific-partnershiprevived-after-11-nations-agree-to-trade-deal. 5 ibid. 6 ibid. 7  Currently being re-negotiated. 8  Above n 3. 9 ibid. 10 Australia; Cambodia; India; Lao PDR; Myanmar; Philippines; Thailand; Brunei; Darussalam; Indonesia; Korea, Republic of; Malaysia; New Zealand; Singapore and Viet Nam. 11  WTO: Japan Trade Policy Review, Secretariat Report 2017, above n 2, para 2.3.3.

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preferences to 33 LDCs, as of December 2015.12 And finally Korea provides on a unilateral basis duty-free market access to 48 UN-defined LDCs.13 All together China, Korea and Japan command a total of 20.8 per cent share of world exports and 16.7 per cent of world imports.14 These percentages, if added on to the partner FTA countries’ trade with NEA countries respectively, including the trade through the unilateral preferential regimes afforded by the States in NEA respectively, results in a normative fragmentation with respect to a significant ­proportion of the world trade in goods and services. The literature on FTAs in NEA is enlightening and essentially two-fold. First, there are country specific works that focus on the FTA practice respectively of China, Korea and Japan.15 Generally, this literature is from a national perspective, empirical with an economic emphasis, and often devoted to specific FTAs, and/or specific issues/sectors. Generally, the legal analysis is not substantial with relatively fewer works that focus on the Japanese FTA practice, at any rate in the English language. Second, there is literature that focuses on the inter-se trade relations of China, Korea and Japan, in particular from the stand-point of greater integration in the region.16 This focus sheds mainly economic and political light on such a

12  WTO: China Trade Policy Review, Secretariat Report 2016 https://www.wto.org/english/tratop_ e/tpr_e/s342_e.pdf, para 12. 13  WTO: Korea Trade Policy Review, Secretariat Report 2016 https://www.wto.org/english/tratop_ e/tpr_e/s346_e.pdf, para 2.6.3. 14 See WTO: World Trade Statistical Review 2016, https://www.wto.org/english/res_e/statis_ e/wts2016_e/wts16_toc_e.htm, 94, 15  For example, China: Kong Qingiang, ‘China’s Unchartered FTA strategy’ (2002) 46 Journal of World Trade 1191–206; Heng Wang, ‘The Challenges of China’s recent FTA: An anatomy of the ChinaKorea FTA’ (2016) 50 Journal of World Trade 417–46; Siyu Tao, ‘China’s FTAs and GATS: The Consistency and the Achievements’ (2014) 41 Legal Issues of Economic Integration 133–68; Gemma Estrada, Donghyun Park, Innwon Park and Soonchan Park, ‘The PRC’s Free Trade Agreements with ASEAN, Japan, and the Republic of Korea: A Comparative Analysis’ Asian Development Bank, Working Paper No 92 (2012); Yunling Zhang, ‘The Impact of Free Trade Agreements on Business Activity: A Survey of Firms in the People’s Republic of China’ Asian Development Bank Working Paper Series No 251 (2010); Maria Garcia, ‘Resources and Trade: Linking the Pacific through Bilateral Free Trade Agreements (FTA)’ (2013) 47 Journal of World Trade 329–58. Korea: Won-Mog Choi, ‘Aggressive Regionalism in the Korea-Us FTA: The Present and Future of Korea’s FTA Policy’ (2009) 12 Journal of International Economic Law 595–615; Jin Ho Myoung et al, ‘The Decade -Long Journey of Korea’s FTAs’ (2014) Institute for International Trade (Korea) Working Paper 14-01, 1–47; To-Hai Liou, ‘South Korea’s FTA Strategy’ (2008) 43 Foreign Trade Review 42–65; Min Ye, ‘South Korea’s Free Trade Strategy and East Asian Regionalism: A Multistage Approach’ (2017) 41 Asian Perspective 147–74; I Cheong and J Cho, ‘The impact of Free Trade Agreements (FTAs) on Business in the Republic of Korea’ Asian Development Bank Working Paper Series No 156 (2009); Chulsu Kim, ‘Korea’s FTA Policy’ in A Kotera et al (eds), The Future of the Multilateral Trading System: East Asian Perspectives (London, Cameron May, 2009); Japan: TJ Pempel and Shujiro Urata, ‘Japan: a new move towards bilateral trade agreements’ in V Aggrawal and S Urata (eds), Bilateral Trade Agreements in the Asia Pacific: Origins, Evolution, and Implications (Abingdon, Routledge, 2006); GP Corning, ‘Japan’s Bilateral FTAs: No obstacles to progress in the Doha Round’ (2007) East Asia 45–65; S Shujiro Urta, ‘Japan’s New Trade Policy: From GATT and the WTO to FTAS’ (2011) 17 Journal of Asia -Pacific Studies (Waseda University); H Konno, ‘Japan’s Multilayered Trade Policy’ in Kotera et al, ibid. 16  Ying Bi, ‘Rising Mega RTA? China-Japan-Korea FTA under the New Trade Dynamism’ (2015) 8 Journal of East Asia and International Law 299–321; Yong-Shik Lee, ‘The Eagle Meets the Dragon—Two Superpowers, Two Mega RTAs, and So many in Between: Reflections on TPP and RECEP’ (2016) 50

Introduction 159

process. The Asian Development Bank has contributed important studies both empirically based on respective State FTA practices, but also generally in informing relevant country negotiators as to good practices in the design of FTAs. In sum whilst the amount of scholarly focus on FTAs in the region is significant, as is the noticeable interest in a trilateral FTA in NEA, there is room for a more normative analysis of the rise in the FTA phenomenon in the region. A normative analysis of FTAs involves a reflection of the dictates of International Law and policy generally relevant to State FTA practice; the WTO disciplines in particular regulating FTAs; the technical legal questions arising from the FTAs and their respective interactions; the domestic constitutional constraints; the de facto domestic constraints; and finally, the relevance of ethical concerns in particular. The normative approach to FTAs, in the received legal wisdom, is set essentially in terms of the relevant WTO disciplines, especially Article XXIV of the General Agreement on Tariffs and Trade (GATT) 1994. Of late, there has been renewed focus into this, arising in particular from the WTO Appellate decision in the Peru-Agricultural Case.17 This legal focus however is only an aspect of the normativity that informs the choice and design of an FTA. The normative approach

Journal of World Trade 475–96; SB Das et al, ‘Can ASEAN +1 FTAS Be A Pathway towards Negotiating and Designing the Regional Comprehensive Economic Partnership (RCEP) Agreement?’ (2016) 50 Journal of World Trade 253–88; S Madhur, ‘China-Japan-Korea FTA: A Dual Track Approach to a Trilateral Agreement’ (2013) 28 Journal of Economic Integration 375–92; M Zhang, ‘Proceeding in hardship: the trilateralism-bilateralism nexus and the institutional evolution of China-Japan-South Korea trilateralism’ (2017) The Pacific Review; Lee-Jay Cho and Chang Jae Lee (eds), Building a Northeast Asian Economic Community (Korea Institute for International Economic Policy, 2015); Choi Bo-Young and Lee Seo Young, Towards Deeper Integration Among China, Japan and Korea (Institute for International Economic Policy, 2017); R Baldwin and M Kawai, Multilateralizing Asian Regionalism Asian Development Bank Institute, Working Paper Series No 431 (2013); Robert Suphian and Im Je Cho, ‘Korea-China-Japan: The Possible Trinity’ (2015) 4 Asian Journal of Social Sciences & Humanities; Yumming Cui, ‘New Evidence of Asian Economic Integration: Prospects and Challenges of a Trilateral FTA between China, Japan and South Korea’ (2013) 5 Perspectives on Federalism 58–78; Innwon Park, ‘Regional Trade Agreements in East Asia’ Norwegian Institute of International Affairs, Working Paper 823 (2013); Saori N Katada, Political Economy of East Asian Regional Integration and Cooperation, Asian Development Bank Institute, Working Paper Series 170 (2009). 17 See Peru-Additional Duty on Imports of Certain Agricultural Products (WTO AB: DS457/ AB/R 2015). See also S Shadikhodjaev, ‘The “Regionalism vs Multilateralism” in International Trade Law: Revisiting the Peru-Agricultural Products Case’ (2017) 16 Chinese Journal of International Law; G Shaffer and A Winters, ‘FTA Law in WTO Dispute Settlement: Peru-Additional Duty and the Fragmentation of Trade Law’ (2017) 16 World Trade Law Review 303–06; Yong Shik Lee, ‘Regional Trade Agreements in the WTO System: Potential Issues and Solutions’ (2015) Journal of East Asia & International Law 353–71; Jong Bum Kim, ‘Entrenchment of regionalism: WTO legality of MFN clauses in preferential trade agreements for goods and services’ (2014) 13 World Trade Review 443–70; PA Lanyi and A Steinbach, ‘Promoting Coherence Between PTAS and the WTO Through Systemic Integration’ (2017) 20 Journal of International Economic Law 61–85; A Fabbricotti, ‘The Interplay Between the WTO and RTAs: Is it a Question of Interrelation Between Different Sources of International Law’ The Society of International Economic Law Online Proceedings Working Paper No 12/08 (2008); Marc D Froese, ‘Mapping the Scope of Dispute Settlment in Regional Trade Agreements: Implications for the Multilateral Governance of Trade’ (2016) 15 World Trade Review 563–85.

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to FTAs adopted here embraces both endogenous and exogenous d ­ isciplines, including those that ought to factor in State FTA practice. The normativity that is exogenous comprises of the international legal framework within which a State can involve itself in FTAs—which essentially centres around Customary International Law, setting out the nature and scope of a State’s right to enter into FTAs, and the relationship between FTAs and the WTO. In addition, there are various policy considerations as to the content of an FTA. In this work however only two policy issues are explored viz the configuring trade with investment in an FTA; and the international ethical dimension in their design—the former because it is an important manner in which the scope of FTAs are evolving, and the latter sheds important ethical light on the subject hitherto not sufficiently taken into consideration. The motivation for a normative analysis of FTAs generally rests in the possible negative consequences of FTAs within the setting of a multilateral trading system, their potency as legislative vehicles, and the possible strategic beggarthy-neighbour FTA alliances that could fuel the number and direction of FTAs in the region. The disadvantages of FTAs have been variously spelled out very eloquently although not so much on the negative impacts of clusters of FTAs on each other.18 In particular, they undermine the multilateral trading system; enable forum shopping; add to complexity; create disparate types of behind the border normative frameworks beyond the mere liberalisation of trade in goods and services, for example in the spheres of investment and competition policy;19 and lock in ‘the industrial structure of the participating developing countries, thereby undermining their long-term development potential.’20

II.  Comparative National FTA Strategies and the Legal Framework in NEA At the outset it should be noted that whereas under the WTO there are certain disciplines under which FTAs can be set up, the WTO through its trade policy reviews, does not focus sufficiently on the strategies Member States have designed for their FTAs, or the national framework for the entering into FTAs. It is the case though that new FTAs are the subject of the WTO Transparency Mechanism established in 2006 and individual FTAs are the subject of review by the WTO Committee on Regional Trade Agreements.

18  See for example Jagdish Bhagwati, Termites in the Trading System: How Preferential Agreements Undermine Free Trade (Oxford, OUP, 2008). 19  See for example Froese, above n 17. 20  Shik Lee, above n 17, 352.

Comparative National FTA Strategies and the Legal Framework in NEA 161

A.  The National FTA Strategies FTAs are entered into generally to fulfil the political and economic interests of States. The specific individual complexion of the State understanding of its political/economic interests can be discerned in the State strategies enunciated or implicit in the State FTA practice. There is now a discernible strategy in the actual FTA practice of the States in NEA. In addition, both Korea and Japan have set out specific statements purporting to articulate their strategies. The respective FTA strategies inform State FTA practice but importantly can serve as a focal point for reflection on the development of a State’s strategy. Both Korea and Japan have articulated such a policy, although this is not the case with China. The importance of having an FTA strategy has been emphasised both for consistency and for guiding negotiators in their work.21 Korea’s FTA strategy can be gleamed from a paper titled ‘A New Trade Roadmap 2013.’22 The following important observations are highlighted here from this Roadmap. First, a recognition that FTAs accord a ‘competitive advantage’ to national trade over the trade of third countries. Second, the previous FTA strategy was geared to the establishment of a Korean FTA hub, and focussed on large ­economic blocs. Moreover, there is recognition that the benefits of the FTA were not widely shared within Korea and there were some issues with the implementation of the FTAs. Third, the new FTA policy is aimed at being a ‘linchpin’ for regional integration; and also focussed on emerging economies. In addition, the FTA is to be responsive to industry concerns, especially in terms of creation of jobs, and support for the private sector, particularly SMEs. In sum, the FTA strategy is not cast in iron and may well be the subject of further change, particularly given a new government in place since that paper. Be that as it may, the paper importantly highlights the need for reflection on a FTA strategy in terms of focus, context, normative influences and implementation. Further, it evidences a considered critical self-evaluation of the past FTA practice—a sign of a mature reflective transparent approach to Korea’s FTA strategy. Based on the actual FTA practice of Korea, the scope of Korean FTAs is wide, focusing on services, investment, intellectual property rights, technical standards and government procurement.23 Moreover, Korea has been active in pursuing mega-FTAs with a view to regional integration.24 The Japanese strategy on FTAs is to be found in a number of sources viz the FTA strategy paper (2002);25 specifically with reference to Economic Partnership

21 

See ADB, How to Design, Negotiate, and Implement a Free Trade Agreement in ASIA (2008). Korea Ministry of Trade Industry and Energy, A New Trade Roadmap, 2014-12-30 http://english. motie.go.kr/en/tp/alltopics/bbs/bbsView.do?bbs_cd_n=3&bbs_seq_n=26#page7. 23  See Myoung, above n 15. 24  See WTO: Trade Policy Review, Korea Secretariat Report 2016, above n 13. 25  Ministry of Foreign Affairs, Japan, Japan’s FTA Strategy (Summary) (2002) at http://www.mofa. go.jp/policy/economy/fta/strategy0210.html. 22 

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Agreements (EPAs), the Japan Revitalization Strategy (2013);26 and prior to that the Basic Policy on Comprehensive Economic Partnerships of 2010.27 The 2002 FTA strategy paper although detailed is relatively opaque. It is also now dated and therefore not of much significance as such. Nevertheless, the following observations may be made given that it is still the only publicly available statement on Japanese FTA strategy. In 2002 Japan was just beginning on its FTA journey and it recognised at the outset that this was an enterprise in which there was a need to reflect on a strategy, and to the extent it could it made an effort at openly reflecting upon it. However, that aside the strategy outlined in 2002 is strong on explaining what are the benefits of entering into FTAs, the WTO parameters within which FTAs need to be designed, the domestic impact of FTAs; and generally the consideration that should be taken into account in a State’s FTA practice viz ‘(i) economic, (ii) geographic, (iii) political and diplomatic, (iv) feasibility, and (v) time-related criteria’28—but it is short in disclosing what specifically is the Japanese FTA strategy. This much however can be gleaned. First, the strategy paper flags the possibility of comprehensiveness using the Japan-Singapore Economic Partnership Agreement as a possible model for future negotiations. Comprehensiveness in coverage is to be accompanied with selectivity and flexibility depending on the partner. Second, FTAs with developing countries are recognised as a facilitator for promoting development. Third, East Asia, including Korea and ASEAN, were recognised as important possible partners in FTAs, on the basis that there was understood to be more scope for further trade liberalisation. The follow up to the 2002 Strategy Paper is to be found in the Basic Policy on Comprehensive ­Economic Partnerships (2010).29 This paper is brief and emphasises inter alia the need to focus on the Asian-Pacific region, emerging and ‘Western and resourcerich’ economies; taking into account the sensitivity of certain sectors, along with the need to reform domestically in the field of agriculture, movement of persons to Japan, and regulatory reforms so as to open up the country more. The Japan Revitalisation Strategy 2013 sets out the objective of increased market access through the expansion of economic partnership agreements as well as the conclusion of investment agreements and tax treaties, removal of institutional obstacles which extend over the domestic and international markets, and promotion of full-fledged globalization within Japan through the improving environment for foreign investment and fostering global human resources.

The development of a business-friendly environment through the expansion of economic partnership agreements is of particular interest to Japan in the

26 http://www.kantei.go.jp/jp/singi/keizaisaisei/pdf/en_saikou_jpn_hon.pdf. http://www.kantei.go. jp/jp/singi/keizaisaisei/pdf/en_saikou_jpn_hon.pdf. 27 Basic Policy on Comprehensive Economic Partnerships 2010 available at: http://www.mofa. go.jp/policy/economy/fta/policy20101106.html. See also WTO: Trade Policy Review Japan Secretariat Report 2017, above n 2, para 2.9. 28 ibid. 29  Available at http://www.mofa.go.jp/policy/economy/fta/policy20101106.html.

Comparative National FTA Strategies and the Legal Framework in NEA 163

­ sia-Pacific through some of the mega FTAs currently under negotiation such as A RCEP, the China/Korea/Japan FTA and globally through the Japan/EU EPA. The Japanese strategy, as elucidated by some independent academic analysis, discerned from actual FTA practice, establishes that Japan is keen to promote FTAs within East Asia which reinforce and secure the expansion of Japanese ‘­globalised value chains’ (GVCs), establish FTA hubs and resource supplying countries; comprise of partners with whom it can protect its domestic agricultural sector; emphasis wide coverage ie WTO Plus—viz services, investment, intellectual property rights and competition policy for the benefit of Japanese interests in GVCs, whilst protecting certain domestic services.30 It is this wide coverage of the ­Japanese FTA focus that has led Japan to term its FTAs as Economic Partnership Agreements (EPAs).31 However, Japanese FTAs do not cover environmental and labour concerns, although the Japanese government maintains that sustainable development and labour issues are covered through references in the FTAs to international agreements covering these issues.32 China has no publicly available position paper on its FTA strategy;33 although official press releases refer to the implementation of a China FTA strategy.34 The reasons for the lack of an openly articulated FTA strategy are not clear but could rest inter alia in a negotiating stance of not revealing in advance the State’s hand; lack of awareness of the need for it; or a non-transparent top-down working culture in the sphere of foreign trade. In this case, the following observations are proffered. A State’s FTA strategy needs to be publicly articulated and discussed since the impact of such a strategy has a domestic impact. Moreover, a public airing of a State’s FTA strategy is conducive to the general development of policies commanding international legitimacy and weight; including the development of an internationally agreed template. Second, it does not necessarily follow that publicly disclosing a strategy in a general manner necessarily compromises the State’s negotiating capabilities. In any event the strategies of the States in NEA can be discerned from their now vast practice in negotiating FTAs. Finally, withholding the disclosure of such a strategy for a negotiating advantage has a mercantilist trait to it. Here it will be noted that the EU has set out in public an extensive and

30  See for example Shujiro Urta, above n 15; Gyu P Kim et al, ‘Japan’s FTA Strategy and Its Implications for Korea’ KIEP World Economy Update (27 March 2015) Vol 5 No 6. http://www.kiep.go.kr/totSch_ eng.jsp?kwd=Japan%E2%80%99s+FTA+Strategy+and+Its+Implications+for+Korea&x=0&y= 0&stype=all. 31  See Saori N. Katada, above n 16. 32  See WTO Trade Policy Review Japan Secretariat Report 2011, para 30, https://www.wto.org/ english/tratop_e/tpr_e/tp343_e.htm. 33  For a similar observation see also Kong Qingjiang, ‘China’s Uncharted FTA Strategy’ (2012) 46 Journal of World Trade at 1192. 34 See for example MOFCOM Press Release: Accelerate the Implementation of the Free Trade Area Strategy and Construct a New Open Economic System, 2016-03-29 http://fta.mofcom.gov.cn/ enarticle/enrelease/201603/31157_1.html. See also Outline of the 13th Five-Year Plan for National Economic and Social Development (2016–20) referred to in WTO: Trade Policy Review China Secretariat Report 2016, above n 12.

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arguably exemplary FTA strategy emphasising the importance of transparency, human rights, sustainable development, high standards of safety and environmental regulation; and public services.35 Moreover, the EU approach is not just EU trade interest-based in the narrow sense, but also incorporates European values whilst focusing on the contemporary global chain-based economy, with a growing digital face. The EU strategy also takes on board the need for an effective synergy between trade policy and consumer, worker and SME interests both in content and the implementation of the strategy. This much however can be discerned about China’s FTA strategy. First, that with respect to the future choice of partner countries, this will be informed by the ‘construction of the free trade area with the countries along the line of the “Belt and Road” and the neighbouring countries.’36 Moreover, China intends to have a global network of FTAs.37 Second, FTA policy has to be within the general foreign trade policy of China38 with high standards,39 in particular as set out in the 2004 Foreign Trade Law of The People’s Republic of China.40 Two provisions of this are of particular note: Article 4 The State shall pursue a uniform foreign trade regime, encourage the development of foreign trade and maintain fair and free foreign trade order. Article 5 The People’s Republic of China shall, on the principle of equality and mutual benefit, promote and develop trade relations with other countries and regions, enter into or participate in such regional economic trade agreements as customs union agreement, free trade agreement and participate in regional economic organizations.

Aside from this the Chinese FTA strategy can be discerned through its FTA practice. The Chinese practice has essentially been formulated on an ad hoc basis, in response to individual circumstances warranting an FTA.41 Thus, it has been described as being pragmatic at its core.42 Moreover, in practice China’s FTAs have been with countries from which it can secure resources for its own development ie economies that are complementary to its economy; with countries that have accepted its market economy status; serve as FTA hubs, and ensure a geographical distribution of FTA connections. In sum, there is room for greater reflection generally in NEA not only on what approach to FTAs should be taken that is coherently set within a State’s foreign

35 See EU: Trade for all Towards a more responsible trade and investment policy. http://trade. ec.europa.eu/doclib/docs/2015/october/tradoc_153846.pdf. 36 http://fta.mofcom.gov.cn/enarticle/enrelease/201603/31157_1.html. 37  See WTO: Trade Policy Review China Government Report 2016, above n 12, para 4.5. 38  Outline of the 13th Five-Year Plan for National Economic and Social Development (2016–2020) referred to in WTO: Trade Policy Review China Secretariat Report 2016, above n 12. 39 ibid. 40 The legislation is to be found at: http://english.mofcom.gov.cn/aarticle/policyrelease/ internationalpolicy/200705/20070504715845.html. 41  Qingjiang, above n 33, 1205. 42  See Garcia, above n 15.

Comparative National FTA Strategies and the Legal Framework in NEA 165

trade policy and circumstances, but also with reference to what should be the appropriate approach to FTAs within NEA. In a sense articulating this question in the form of a strategy perpetuates a mercantilist approach to them. FTA need not be about strategies necessarily. The somewhat prior question namely what mindset should one have in designing a strategy is an important aspect of the FTA strategy.

B.  The National Legal Frameworks Korea has a statutory framework for the manner in which FTAs are negotiated, and any adjustment issues arising consequent upon the establishment of an FTA.43 First, the Act on the Conclusion Procedure and Implementation of Commercial Treaties sets out the framework for the entering into an FTA as follows: The purpose of this Act is to prescribe necessary matters in relation to the procedures for concluding treaties regarding commerce and the implementation thereof in order to enhance transparency in the procedures for concluding treaties regarding commerce and to promote efficient commercial negotiations with citizens’ understanding and participation, as well as to ensure the rights and interests of the Republic of Korea in implementing treaties regarding commerce, thereby contributing to sound development of the national economy.44

In furtherance of this aim, the legislation sets out a mechanism for the disclosure of information upon the request of any individual with respect to the conclusion of an FTA; the calling of a Public Hearing to facilitate inputs from interested parties, experts and citizens before the formulation of a plan for an FTA; the seeking of the consent of the National Assembly for the ratification of the FTA; a Public Hearing before the entry into force of the FTA and the establishment of a Civilian Advisory Committee on Commercial Negotiations. Moreover, the Ministry of Trade, Industry and Energy before embarking on negotiations has to have a ‘Plan for Concluding a Commerce Treaty’, along with an Economic Feasibility Study, and a further ‘Assessment of Impact’ when a provisional agreement has been reached with the other party. Second, the Act on Trade Adjustment Assistance Following the Free Trade Agreements is intended to ensure ‘effective measures to assist enterprises engaging in manufacturing or providing services that sustain or are likely to sustain any loss or damage in the course of implementing free trade agreements entered into by the Government and their employees.’45

43  See the Act On the Conclusion Procedure and Implementation of Commercial Treaties 2012 (as amended); and the Act On Trade Adjustment Assistance Following The Free Trade Agreements 2007 (as amended). 44  Art 1 of the Act On the Conclusion Procedure and Implementation of Commercial Treaties 2012 (as amended). 45  Art 1 of the Act On Trade Adjustment Assistance Following The Free Trade Agreements 2007 (as amended).

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The ­measures for assistance include advice, loans and assistance in change of occupation of employees. There is no specific legal framework for the formulation negotiation and implementation of FTA policy and practice in Japan. The general internal good governance framework is however applicable to the initiation, negotiation, entry into force and implementation of FTAs. This much can be gleaned.46 First, that the Japanese Ministry of Economic, Trade and Industry and the Japanese Ministry of Foreign Affairs are the lead ministries that are concerned with FTA matters.47 However, there are several other ministries and agencies that are also concerned with FTA policies such as the Cabinet Office; the Ministry of Finance; the ­Ministry of Agriculture, Forestry and Fisheries; the Ministry of Education, Culture, Sports, Science and Technology; the Ministry of the Environment; the Ministry of Health, Labour, and Welfare; and the Ministry of Land, Infrastructure, Transport and Tourism. The ultimate responsibility with respect to trade policy rests with the Cabinet.48 Second, that the Chief negotiator comes from the Ministry of Foreign Affairs and is supported by around 50 others.49 For the TPP negotiations ­however the government reserved about 100 negotiators.50 Third, FTAs which require changes in Japanese law or the continued maintenance of certain legislation, or impact on financial matters, need the approval of the Japanese Diet.51 Trade ­policy and therefore FTA issues are the subject of deliberation in the J­ apanese Diet. Fourth, as of 2007 all organs of government involved in legislative work need to conduct both ex ante and ex post evaluation of proposed FTAs, and their implementation under the Government Policy Evaluation Act of 2001.52 However, costbenefit analysis is not often availed for the economic impacts of FTAs.53 Fifth, under the Revised Administrative Procedure Law all relevant government organs involved in the legislative process must set up a ‘public comment’ procedure, involving first the publication of the draft proposal to receive public comments, which must then be considered and published.54 Sixth, there is no general adjustment system to address negative impacts on domestic industry and employees therein arising from an FTA, as is the case in Korea. Finally, it has been observed that there is a ‘structural flaw in the traditional decision-making mechanism of Japan’55 in its machinery of government. Thus, government decision-making is by

46  See for example ADB Report, ‘How to Design, Negotiate, and Implement a Free Trade Agreement in ASIA’ (2008) and WTO Trade Policy Reviews of Japan. 47 ibid. 48  WTO Trade Policy Review Japan Secretariat Reports 2017, above n 2. 49 ibid. 50  See Japan Revitalization Strategy (2013), above n 27, 129. 51 ibid. 52  See WTO Trade Policy Review Japan Secretariat Report (2009)., https://www.wto.org/english/ tratop_e/tpr_e/tp311_e.htm. 53  WTO Trade Policy Review Japan Secretariat Report (2011), above n 32, paras 4; 14; 15 and 30. 54  WTO Trade Policy Review Japan Secretariat Report (2009), above n 52, para 14. 55  Konno, above n 15, 25.

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consensus and all affected ministries are involved; and the ministries are staffed by life-long civil servants.56 Moreover, the Japanese bureaucracy has traditionally been autonomous, with a tendency for a weak executive taking its cue from it; and protectionist voices in its constituency.57 China does not have a specific legal framework with respect to the negotiation and entry of FTAs. Nor it seems an adjustment framework to cater for adverse impacts. The Ministry of Commerce (MOFCOM) under the direction of the National Development and Reform Commission (NDRC) is the main agency for negotiating and implementing FTAs.58 Relevant legislation would need to go through the National People’s Congress (NPC). The authority to ratify an international agreement rests with the President. Generally draft laws need to be published for public comment for a period of 30 days.59 However, it has been observed, although in 2010 by the Organisation for Economic Co-operation and Development (OECD), that ‘public participation in policy formulation in China is still at a relatively early stage, characterized by informing the public rather than collecting opinions for improving policy making.’60 With respect to impact evaluation feasibility study reports, these involve consensus amongst all the agencies implicated by the FTA, and are therefore ‘­time-costly.’61 China does not have requirements in its law for impact evaluation reports with respect to the negotiation and entering into effect of FTAs. Moreover, it has been observed in the WTO: Neither ex ante nor ex post economic evaluations of policies and measures (including tax and non-tax incentives) are published, indicating that this form of transparency is not a major feature of China’s institutional framework, to the detriment of public accountability and thus governance.62

In this respect China is no different from some other countries like India where FTAs are not required to be ratified by its Parliament, and impact assessment ­studies are not made public.63 In conclusion, there is scope for further domestic improvements in the national legal framework for FTAs in China, and to a more limited extent in Japan.

56 ibid.

57 See Yu Uchiyama, ‘Trade negotiations and the Domestic Politics: Political Institutions and Agricultural Liberalization in Japan’ in Kotera et al, above n 15. 58  WTO Trade Policy Review (2016) China Secretariat Report, above n 12. 59  ibid, para 2.6. See also WTO Trade Policy Review (2014) China Secretariat Report, para 2.14, https://www.wto.org/english/tratop_e/tpr_e/tp400_e.htm. 60  See OECD (2010b) p.220 cited in WTO Trade Policy Review (2012) China Secretariat Report para 14. https://www.wto.org/english/tratop_e/tpr_e/tp364_e.htm. 61  See Qingjiang, above n 33, 1199. 62  WTO Trade Policy Review (2012) China Secretariat Report, above n 60, para 9. 63 See for example Ranja Sengupta, ‘As Current Rounds of Talks Draw to a Close, Questions About RCEP Loom Large Over India’ The Wire (27 July 2017) https://thewire.in/162115/rceptalks-questions-loom-large-over-india/.

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C.  The Normative Map of NEA FTAs A comprehensive description and analysis of the legal nature and substantive content of the various FTAs entered into by the States in NEA is not possible in this work. Most of the FTAs are available on the WTO website.64 Two observations are however proffered. First, based on a recent normative mapping exercise compiled65 by Choi Bo-Young and Lee Seo Young on the FTAs entered into by China, Japan and Korea up to 2015 focusing on the legal nature of the FTA obligations, ie whether they are soft or hard, along with the sectors covered in the FTAs, the following can be highlighted. The FTAs cover extensively WTO + provisions (defined as provisions reconfirming and adding to the existing obligations under the WTO, for example, Technical and Phytosanitary Standards and the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPs)) but less in terms of WTO-X (defined in terms of issues outside the current WTO mandate, for example anticorruption, competition policy, Investment, Labour, Movement of Capital). There are more WTO + and WTO-X provisions in Korean FTAs, than in those of Japan and China in that order. Generally, the nature of these provisions is expressed in hard terms, although WTO-X provisions are relatively softer in nature. H ­ istorically Korean and Japanese FTAs cover a wider range of sectors, and are more legally enforceable than the practice of China. However, generally all three have progressed in their FTAs to have more and more WTO + and WTO-X provisions as the years have passed. Finally, as between the three countries there are variations, particularly in so far as China is concerned, in the type of WTO-X provisions that are included. Thus, China’s FTAs historically excluded WTO-X provisions that were not in alignment with a socialist system, for example State trading, labour and the environment. However, recent China FTAs have shown a more inclusive approach to these issues. Second, FTA preambles can be revealing of the spirit and approach of the parties to the FTA, even if in themselves they do not contain binding norms as such. Based on the author’s survey of the various preambles (including provisions setting out the objectives of the FTAs in the text of the agreements) of the FTAs of all three NEA states, the following is noted. Generally, most of the FTA preambles in the practice of all three NEA States focus essentially on economic objectives but also include references to sustainable development, relevant WTO obligations and the need for flexibility in pursuing national public policy objectives. The Chinese and Japanese preambles tend to be shorter and more focussed on economic aspirations with occasional references to the WTO obligations, sustainable development and recognition of flexibilities in pursuing national public policy objectives. In the case of Japan, the preamble is fairly standard with a number of countries

64 https://rtais.wto.org/UI/PublicMaintainRTAHome.aspx. 65 

Bo-Young and Young, above n 16.

Towards a Regional FTA? 169

(mostly Asian countries and some Latin American); and essentially focussed on economic objectives with the exception of the one with Switzerland66 wherein ­references are made to non-economic conditions viz the UN Charter, democracy, rule of law, and fundamental freedoms under International Law. The same is the case with the China-Switzerland FTA in so far as non-economic considerations are concerned but it also includes corporate governance and corporate social responsibility for sustainable development.67 On the other hand the preambles in Korean FTAs embrace a wider spectrum of objectives, for example the Korean-Peru FTA refers to labour conditions, corruption, bribery and human rights in international trade and investment. This however is not the case with the Japan-Peru68 or for that matter China-Peru69 FTAs. The Korea US (2007), the Korea-EU (2010) and Canada-Korea (2014) FTAs include references to labour standards. The Korea-EU also has references to the UN Charter and the Universal Declaration of Human Rights;70 and the Canada-Korea has references to democracy and human rights. In conclusion, the normative map of the FTAs is evolving; and this has been particularly marked in so far as China’s FTAs are concerned. All three countries have a proactive external FTA strategy. In particular, all three have some common FTA partners. All three have FTAs that have extensive legally enforceable provisions although historically China has lagged behind.71 All three countries have extensive WTO + obligations although in this respect Korea has relatively more.72 Moreover, NEA FTAs with Asian countries generally do not have references to noneconomic objectives other than sustainable development on occasions. Where the FTAs involve different civilisational settings, there is a tendency to refer in the preamble to non-economic considerations, unless there is a parity or strength in economic prowess, which may minimise or displace such allusions. In short, NEA FTA preambles evidence and affirm non-trade domestic and international concerns. However, with respect to non-trade concerns they are wanting—revealing a myopic preference for ring-fencing trade and investment concerns; instead of taking a serious integrated approach to them. Are they a missed opportunity for inculcating Asian values in FTA preambles?

III.  Towards a Regional FTA? There are mainly two FTAs that have been under negotiation that bring China, Korea and Japan under the auspices of one FTA—the China, Japan and Korea 66 

See Japan-Switzerland FTA 2009. See China-Switzerland FTA 2013. 68 2011. 69 2009. 70 2010. 71  See Bo-Young and Young, above n 16. 72 ibid. 67 

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FTA (CJK); and the Regional Comprehensive Economic Partnership (RCEP). Both developments have attracted much attention although more so in the case of the CJK.73 Thus far there have been 12 rounds of trade negotiations for the CJK—the twelfth being held in April 2017. Generally, there is a positive consensus for a CJK—a conclusion endorsed by the Joint Standing Committee in its feasibility study report in 2011.74 Whilst the CJK would have a positive effect on all three, its impact on Korea is predicted to be most pronounced.75 Such a consensus is set against the background of the impressive share that the three countries have of international trade and world GDP;76 the trilateral investment agreement between the three countries;77 the Korea-China FTA;78 and the de facto regional integration of the three economies. Moreover, the CJK would facilitate the orchestrating of an NEA voice in the development of the international economic order; the reduction of the negative ‘Spaghetti Bowl’ effect of the FTAs in the region, in particular through diverse Rules of Origin; and impacting as a building block for the RCEP. There are however political obstacles viz territorial and historical disputes; reluctance on the part of Korea to embrace Japan as manifested with its Korea-China FTA, although the Terminal High Altitude Area Defence (THAAD) issue has put some strains on Korea-China relations; Chinese domestic sector concerns in the high-tech and auto industry of foreign competition from Korea and Japan; Japan’s concerns over its agricultural sector; Korea’s concern over excessively being dependent on China and Japanese competition; and finally a lack of a strong ­leadership in pushing forward the completion of the CJK.79 In fact, the lack of leadership in NEA has meant that by default ASEAN has been the key coordinator in facilitating economic integration in NEA.80

73  See for example the Joint Study Report for an FTA among China. Japan and Korea http://www. mofa.go.jp/mofaj/press/release/24/3/pdfs/0330_10_01.pdf; Bo-Young and Young, above n 16; Cho and Lee, above n 16 Muhui Zhang, ‘Proceeding in hardship: the trilateralism-bilateralism nexus and the institutional evolution of China-Japan-South Korea trilateralism’ (2017) The Pacific Review; Madhur, above n 16; S Das et al, above n 16; Lee, above n 16; Bi, above n 16; Suphian and Cho, above n 16. 74  Joint Study Report for an FTA among China. Japan and Korea http://www.mofa.go.jp/mofaj/ press/release/24/3/pdfs/0330_10_01.pdf. 75  See Cui, above n 16. 76 Percentage of world exports China 12.3%; Japan 3.6%; and Korea 3%. Percentage of world imports China 10.3%; Japan 4.3%; and Korea 2.8%. NEA total export share: 18.9%. NEA total share of imports 17.4%. Source: WTO: International Trade Statistics 2015 https://www.wto.org/english/ res_e/statis_e/its2015_e/its2015_e.pdf. In terms of GDP China 14.8%; Japan 5.9%; and Korea 1.8%. Total world GDP of NEA 22.5% in 2017 Source: World Economic Forum https://www.weforum.org/ agenda/2017/03/worlds-biggest-economies-in-2017/. 77  Signed 2012 and ratified by all in 2014. 78  In effect 2015. 79  See Cui, above n 16; and Park, above n 16. 80  Park, ibid.

Towards a Regional FTA? 171

RCEP81 is currently being negotiated under the auspices of ASEAN82 which already has FTA relations with China, Korea and Japan respectively. There have been 19 negotiating rounds thus far for RCEP—the last being held in India in July 2017. The launch of the negotiations for RCEP was announced in 2012, upon studies conducted by Experts Groups for an East Asia Free Trade Area (EAFTA), and Comprehensive Economic Partnership in East Asia (CEPEA).83 It will be noted that the antecedents of the initiative for RCEP are set in two East Asian initiatives, viz EAFTA and CEPEA, which then were merged into one proposal.84 RCEP also builds from the ASEAN Plus One FTAs including with China, Korea and Japan. Moreover, the RCEP initiative were the result of joint efforts made by Japan and China who saw a value in an East Asian FTA.85 Formal negotiations for RCEP began in 2013. The negotiations are as between ASEAN countries, Japan, China, the Republic of Korea, Australia, New Zealand and India. The agenda of RCEP includes trade in goods and services, investment, economic and technical cooperation, intellectual property, competition, dispute settlement. RCEP if and when completed will cover 30 per cent of world trade, and a significant proportion of the world population.86 The guiding principles for the negotiation of RCEP are mainly: 1. The RCEP will be consistent with the WTO, including GATT Article XXIV and GATS Article V. 2. The RCEP will have broader and deeper engagement with significant improvements over the existing ASEAN+1 FTAs, while recognizing the individual and diverse circumstances of the participating countries. 3. The RCEP will include provisions to facilitate trade and investment and to enhance transparency in trade and investment relations between the participating countries, as well as to facilitate the participating countries’ engagement in global and regional supply chains. 4. Taking into consideration the different levels of development of the participating countries, the RCEP will include appropriate forms of flexibility including provision for special and differential treatment, plus additional flexibility to the least-developed ASEAN Member States, consistent with the existing ASEAN+1 FTAs, as applicable.

81  For background information on RCEP see ASEAN website at: http://asean.org/?static_post=rcepregional-comprehensive-economic-partnership. See also for example Shujiro Urata, ‘Constructing and Multilateralizing the Regional Comprehensive Economic Partnership: An Asian’ ADBI Working Paper Series 449 (ADBI: 2013). 82 ASEAN has 10 members viz Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei ­Darussalam, Viet Nam, Lao PDR, Myanmar and Cambodia. 83  See Joint Declaration on the Launch of Negotiations for the Regional Comprehensive Economic Partnership 2012 http://www.mofa.go.jp/announce/announce/2012/11/pdfs/20121120_03_01.pdf. 84  Urata, above n 81. 85 ibid. 86  See http://www.asean.org/storage/images/2015/October/outreach-document/Edited%20RCEP.pdf.

172  Free Trade in NEA 5. The ASEAN+1 FTAs and the bilateral/plurilateral FTAs between and among participating countries will continue to exist and no provision in the RCEP agreement will detract from the terms and conditions in these bilateral/plurilateral FTAs between and among the participating countries. 6. …. 7. Provisions for technical assistance and capacity building may be made available, building upon the ASEAN+1 FTAs, to the developing and least-developed countries participating in the RCEP to enable all parties to fully participate in the negotiations, implement obligations under the RCEP and enjoy the benefits from the RCEP.87

In conclusion, it remains to be seen how these negotiations will develop and what kind of impact other developments such as the CPTPP will have on the pace of the negotiations. Importantly, the discourse has developed thus far, and there is a basis for developments in the future.

IV.  The International Legal Framework The international legal framework under which FTAs are set is complex. It comprises WTO disciplines; the law of the FTA; the disciplines that are incorporated in the FTA by express reference (for example BITS, multilateral agreements and other FTAs) or through the operation of the most favoured nation (MFN) standard; General Principles of Law and Customary International Law—given that FTAs like the WTO, do not exist in clinical isolation from the rest of International Law—and finally even domestic law. The Customary International Law can be in the nature of peremptory norms although of limited relevance.88 Examples of Customary International Law norms that may be relevant are rules on State responsibility and those on investment protection and dispute settlement.89 Rules of General International Law are applicable unless specifically contracted out in the FTA.90 Underpinning this legal regime are two important questions which have a bearing on how nature of its content is interpreted. First, what is the scope of the State’s right to discriminate in international trade and investment? Second, what is the relationship of FTAs to WTO disciplines? These two preliminary questions are explored here first before the actual WTO disciplines are outlined. Whilst the ­General International Law constraints are not specifically explored91 the first question posited herein is underpinned by this body of International Law. 87  See Guiding Principles and Objectives for Negotiating the Regional Comprehensive Economic Partnership 2012 http://www.mofa.go.jp/announce/announce/2012/11/pdfs/20121120_03_02.pdf. 88  See Andrew D Mitchell et al, ‘PTAs and Public International Law’ in S Lester et al (eds) Bilateral and Regional Trade Agreements 2nd edn (Cambridge, CUP, 2015) 130. 89 ibid. 90 ibid. 91  See however further Mitchell et al, above n 88.

The International Legal Framework 173

A. The Nature of the Right to Discriminate in International Trade and Investment Both the right to discriminate in international trade and investment including its admission, have been generally described as sovereign rights under Customary International Law.92 This right includes the right to choose a trading partner and afford a preferential market access including the right to accord preferential ­market access for investment. Do States in NEA negotiate FTAs against the backdrop of such an absolute sovereign right? It is this author’s contention that this absolutist narrative of the right of the State to discriminate cannot be so lightly made nor indeed sustained. Equality of States may well entail a certain level of discretion in the choice of partners to trade and invest with, but this empowering equality in international economic relations is set against the background of the equality of other States. Thus, in some measure the right to discriminate is tempered by the duty to recognise an equality between States. Moreover, it is also set against the objective of a liberal trading system that underpins the multilateral trading system under the WTO. Thus, engagement in FTAs is tolerated because they contribute to trade liberalisation, and not because they rest in any domain of ‘absolute discretion’ a State may or may not have in its foreign economic relations. Granted that the choice of a trading partner is informed by a number of considerations dear to the State (economic, political, strategic)—but these concerns are not set in a vacuum in the absolute discretion of the State—they are now set in the modern international economic order underpinned by a liberal trade ethos; the expectation of coherence in international trade policy-making; certain minimum standards of State conduct grounded in Customary International Law; and a developing sustainable development regime in International Law. Thus, elsewhere this author has observed with respect to the right to discriminate in international trade: This is somewhat a difficult conclusion to take in this era of international economic relations despite the vast de facto practice of discrimination set in RTAs. Has the notion of sovereignty not changed since the ‘Westhphalian’ sovereignty that the conclusion echoes? Does equality of States not involve some notion of non-discrimination? Is it really possible in this time of organised international economic relations to assert without substantiating with reference to current State practice that there are no ‘limitations in customary international law in engaging in preferential or discriminatory treatment’? Are there not

92  See for example Thomas Cottier and Marina Foltea, ‘Constitutional Functions of the WTO and Regional Trade Agreements’ in Lorand Bartels and Federico Ortino (eds), Regional Trade Agreements and the WTO Legal System (Oxford, OUP, 2006) Ch 4. See also Fabbricotti, above n 17. However, Alberta Fabbricotti relies on dated sources viz, G Schwarzenberger, ‘The principles and standards of International Economic Law’ (1966-1) 117 Recueil des Cours 74; and AA D’Amato, The Concept of Custom in International Law (Ithaca-New York, Cornell University Press, 1971); and S Zamora, ‘Is there Customary International Economic Law?’ (1989) German Yearbook of International Law 28–29.

174  Free Trade in NEA any principles in International Law that preclude or inhibit discrimination in international economic relations that result in significant damage to a people of a nation? Can Ruritania literally at its whim decide no longer to import bananas from Onecommodityexportland (OCEL), or export vital grains to OCEL and consequently imperil the lives of the people of OCEL leading to a possible humanitarian calamity? Do not the sum total of treaty and State practice now call for a reappraisal of this post-colonial era analysis of the right of a Sate to choose its trading partners at any rate completely at its whim? Is it not a fundamental tenet of the WTO whose membership now comprises the overwhelming majority of States that there should be non-discrimination as between members in trade? … Or at best is this right to discriminate not circumscribed by a requirement not to act capriciously as a matter of law; or to reflect on the consequences of discrimination before exercising that right to discriminate?93

In the same vein, with respect to investment there are sound reasons for questioning this mantra both in law and policy.94 Can the State deny the right of its people the reception of needed as well as desired investment flows in fulfilment of their right to development? Does the principle of sustainable development not inform a State’s right over the entry of foreign investment in any form? Could the denial of the entry of certain foreign investment flows impact on the sustainable use of its national resources? Could the denial of the entry of foreign investment flows result in the undermining of the sustainable use of foreign resources? If private foreign investment flows partake of the international mechanism for redistribution of resources amongst States in fulfilment of the tenets of distributive justice, is the absolute right of the State not informed by this fact? Are States not the subject of some form of minimum standard in engaging in their right to administer the entry of foreign investment flows? What is the interplay between the international prohibition on racial discrimination and this ‘absolute right’? And finally do neighbours from a moral vantage have a greater locus standi as potential trading partners? In sum, States cannot engage at their whim in bilateral economic relations both in terms of the choice of partner and the manner of their conduct towards others. Indeed, in practice when a request for an FTA has been made a negative response or reluctance has not been justified for example on racial or religious grounds, but on the basis of such considerations as the amount of trade involved, or the need to prioritise the limited time and resources of FTA negotiators.95

B.  The Relationship between WTO and FTAs Is there a hierarchical relationship between FTAs and the WTO such that FTAs need to be established within the parameters set for them under the WTO? 93 

See Asif H Qureshi, Interpreting WTO Agreements 2nd edn (Cambridge, CUP, 2015) 341. Asif H Qureshi, ‘Communication Flows in International Economic Law’ (2013) 10(1) Manchester Journal of International Economic Law 1. 95  It is understood that this has been the reason for the delay in setting up negotiations for a Pakistan Korea FTA. 94 

The International Legal Framework 175

This latter enquiry touches on the interpretation of provisions of the Vienna Convention on the Law of Treaties (VCLT) that deal with same subject matter treaties, subsequent treaties and rights inter-se to modify a multilateral agreement.96 In this respect there has been much discussion.97 In this author’s opinion however, FTAs are conceptually exceptions and/or expressly authorised departures within set parameters giving rise to a ‘defence’ for certain departures.98 The establishment of FTAs therefore does not result in any modification/alteration or ‘amendment’ of the WTO obligations. FTAs do not result in inter-se modification as between certain members of the WTO of Article XXIV of GATT 1994 and/or Article V of the General Agreement on Trade in Services (GATS). Additionally, FTAs do not allow members to displace WTO disciplines as a matter of their absolute choice.99 The departure from the MFN is a consequence of the FTA that is expressly exonerated. A modification would only take place if there was no permission for the establishment of an FTA. In the circumstances, the WTO provides the constitution of the world trading system. It provides a comprehensive set of norms for the world trading system, including some very fundamental principles that underpin the word trading order; and it provides a kind of a legislative/executive and judicial system that is overarching in the system of world trade.

C.  The WTO Disciplines There is no universally agreed template for the negotiations of an FTA, as for instance in the field of double taxation.100 However, a survey of FTAs will reveal similarities. The parameters within which FTAs need to be established are set under the WTO in Articles XXIV of GATT 1994 and V of the GATS. The basic principles here are that the FTA should not result in a greater burden to third countries and that it must cover substantially all the trade between the parties. These disciplines have been further clarified in WTO jurisprudence. First, with reference to the ability of members of the WTO to modify as between themselves provisions of the WTO under Article 41 of the VCLT titled ‘Amendment and Modifications of Treaties’ the Appellate Body (AB) has observed: [T]hat the WTO agreements contain specific provisions addressing amendments, waivers, or exceptions for regional trade agreements, which prevail over the general provisions of the Vienna Convention, such as Article 41. This is particularly true in the case

96 

See Arts 30 and 41 of the Vienna Convention on the Law of Treaties. See Qureshi, above n 93, ch 8; Cottier and Foltea, above n 92; Mark E Villiger, Commentary on the 1969 Vienna Convention on the Law of Treaties, (Leidein, Martinus Nijhoff, 2009); DM McRae, ‘The WTO in International Law: Tradition Continued or New Frontier?’ (2000) 3(1) Journal of International Economic Law 27–41, 38. 98  See Turkey-Textiles (WT/DS34/AB/R) para 45. 99  See Turkey-Textiles (AB). 100  See the OECD or UN Model Double Taxation Conventions. 97 

176  Free Trade in NEA of FTAs considering that Article XXIV of the GATT 1994 specifically permits departures from certain WTO rules in FTAs.101

The observations of the AB here whilst welcome and in substance correct can be open to some criticism in the manner of their formulation. First, they seem to conflate ‘modification’ with ‘amendment’. These are distinct and moreover there is actually no general modification provision in the Marrakesh Agreement Establishing the WTO expressly as such. Second, it has been observed102 that the AB fails to recognise the contractual freedom of members to modify rules as between themselves through FTAs that do not adversely affect the interests of other members. This observation however does not sit well with the fact that neither the AB nor the relevant disciplines in the WTO limit the discretion of members in arranging their affairs, provided there is no adverse effect on the interests of other ­members. Moreover, the contractual freedom does not exist as a consequence of the WTO—what may exist is some measure of discretion within the framework of the WTO. In sum, members of the WTO are constrained in the scope of their ability to modify WTO obligations. They are however at liberty to establish rules inter-se that do not violate the integrity of their WTO obligations. Second, the AB observed that the compatibility of an FTA must be judged with reference to ‘Article XXIV of the GATT 1994 … in respect of trade in goods; and Article V of the General Agreement on Trade in Services (GATS) in respect of trade in services.’103 With reference to Article XXIV of GATT 1994, the AB adumbrated three conditions to be satisfied for an FTA to be compatible with the WTO, as follows: 5.115. In Turkey—Textiles, the Appellate Body considered that Article XXIV of the GATT 1994 may provide justification for measures that are inconsistent with certain other GATT 1994 provisions, provided that two cumulative conditions are fulfilled: (i) the party claiming the benefit of this defence must demonstrate that the measure at issue is introduced upon the formation of a customs union or FTA that fully meets the requirements of Article XXIV; and (ii) that party must demonstrate that the formation of that customs union or FTA would be prevented if it were not allowed to introduce the measure at issue. 5.116. In setting out the above cited conditions for a GATT 1994-inconsistent measure to be justified as part of a customs union or FTA under paragraph 5 of Article XXIV of the GATT 1994, in Turkey—Textiles, the Appellate Body relied also on paragraph 4

101  Peru-Additional Duty on Imports of Certain Agricultural Products (WTO AB: 2015) para 5.112. Footnotes omitted. 102  See Shaffer and Winters, above n 17, 320: ‘The Appellate Body dicta again problematically refuses to recognise WTO Members’ contractual freedom to update and modify the rules that apply between them through FTAs … We contend that the WTO Appellate Body was wrong in suggesting that WTO law forecloses the use of all inter se modifications, especially the provisions that the Appellate Body cited—Article X of the WTO Agreement and GATT Article XXIV.’ …. ‘GATT Article XXIV is about inter se trade liberalisation as a condition for deviation from MFN—not about inter se consent to a non-MFN measure that does not adversely affect other WTO Members …’ 103  Peru-Additional Duty, above n 101, para 5.113. Footnotes omitted.

The International Legal Framework 177 of this provision, which states that the purpose of a customs union or FTA is ‘to facilitate trade’ between the constituent members and ‘not to raise barriers to the trade’ with third countries. We further note that paragraph 4 qualifies customs unions or FTAs as ‘agreements, of closer integration between the economies of the countries parties to such agreements’. In our view, the references in paragraph 4 to facilitating trade and closer integration are not consistent with an interpretation of Article XXIV as a broad defence for measures in FTAs that roll back on Members’ rights and obligations under the WTO covered agreements.104

Finally, with respect to the impact of FTAs through the interpretative processes set out in Article 31 of the VCLT, the AB pointed out the limitations on the interpretative process viz that a provision in an FTA cannot modify or amend as between the parties the relevant WTO obligations being contested. Thus, the AB stated: We thus understand that, with multilateral treaties such as the WTO covered agreements, the ‘general rule of interpretation’ in Article 31 of the Vienna Convention is aimed at establishing the ordinary meaning of treaty terms reflecting the common intention of the parties to the treaty, and not just the intentions of some of the parties. While an interpretation of the treaty may in practice apply to the parties to a dispute, it must serve to establish the common intentions of the parties to the treaty being interpreted.105

Furthermore. the AB observed that it did not ‘consider that Article 31 can be used to develop interpretations based on asserted subsequent agreements or asserted “relevant rules of international law applicable in the relations between the parties” under Article 31(3)(a) and (c) that appear to subvert the common intention of the treaty parties as reflected in the text’ of the WTO agreements.106 In sum, parties to an FTA have a measure of space within which they can set the terms of their relationships in the FTA departing from WTO disciplines. However, the conditions departing from the WTO disciplines must be introduced upon the formation of the FTA, which FTA must comply with the requirements for the formation of an FTA under Article XXIV.107 Moreover, the conditions departing from WTO disciplines must be necessary for the formation of the FTA. Finally, the FTA

104 

ibid. Footnotes omitted. ibid, para 5.95. 106  ibid, para 5.94. 107  See for the principal obligations relevant to FTAs: Art XXIV (5) (b) ‘with respect to a free-trade area, or an interim agreement leading to the formation of a free-trade area, the duties and other regulations of commerce maintained in each of the constituent territories and applicable at the formation of such free–trade area or the adoption of such interim agreement to the trade of contracting parties not included in such area or not parties to such agreement shall not be higher or more restrictive than the corresponding duties and other regulations of commerce existing in the same constituent territories prior to the formation of the free-trade area, or interim agreement as the case may be;’ and Art XXIV (8) (b) ‘A free-trade area shall be understood to mean a group of two or more customs territories in which the duties and other restrictive regulations of commerce (except, where necessary, those permitted under Articles XI, XII, XIII, XIV, XV and XX) are eliminated on substantially all the trade between the constituent territories in products originating in such territories.’ 105 

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must not roll back the FTA parties’ rights and obligations under the WTO covered agreements. Outside the context of this members of the WTO are at ­liberty to arrange their affairs inter-se as they wish in so far as WTO disciplines are concerned. In the case of the FTAs in NEA these sets of WTO disciplines give the respective States of NEA rights as members of the WTO—not to mention other members of the WTO. But what about the FTA practices of one NEA member ­having an adverse effect on the FTAs of another member?

V.  Some Reflections on Policy Considerations FTAs raise a variety of policy considerations. Doubtless the future FTAs as between the NEA States will have a different policy dimension to those NEA FTAs with third countries. In this section, three aspects of policy concerns are reflected upon albeit briefly: regulatory harmonisation; relationship between trade and investment; and the ethical dimension to FTAs.

A.  Reflections on Regulatory Harmonisation FTAs are now important vehicles for harmonisation of the environment in which trade and investment takes place. The new generation of FTAs increasingly have such a focus. Obstacles and distortions to international trade can be embedded in differences in national trade-related legislation, in particular national regulatory regimes. In NEA the Chinese paradigm of the market is different from those of Korea and Japan. Equally all three countries have differences in their approach to commercial regulation. Regulatory level playing fields facilitate international trade and investment. ­Harmonisation promotes the liberalisation agenda and brings about greater efficiency in international trade. It brings about a relationship between non-trade concerns and the core agenda of FTAs. And it facilitates the inculcation of internationally agreed standards to these concerns including in particular those endorsed within the WTO; provides an analytical approach to the adoption of such concerns—and arguably may serve to flag these concerns up for regional consideration and adaptation. Would regional harmonisation be easier? Not necessarily given the Chinese economy has a different model. Would it be easier to break from the established trends in respective NEA State FTAs? Even if there could be regional harmony established, would it translate in its implementation domestically respectively, particularly in times of regional tensions? On the other hand, harmonisation can undermine national policy space; brings the blandness of uniformity; and like a grand design if faulty can have a monumental impact. Could regional harmony if achieved affect the ability to engage with third party FTAs?

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In sum, the WTO has a framework for facilitating harmonisation of domestic trade laws of its members.108 FTAs can further endorse the WTO approach— equally NEA FTAs can be specific vehicles for NEA impressions. In reality however, the intra-regional arrangements would probably serve at any rate initially only as reinforcing agents of WTO and international efforts at harmonisation unless within NEA there is a leadership that can impress its own imprint of regulatory harmonisation.

B. Reflections on the Configuration of Both Trade and Foreign Investment in FTAs109 The historical divergence in the underlying objectives of the trade and investment regimes and manner of their normative development—multilaterally in the case of trade and bilaterally in the case of investment—begs the question given the increasing investment liberalisation through the trade paradigms of FTAs, whether international investment liberalisation and its regulation should be conceived through the prisms of FTAs. Is it appropriate that the liberalisation in the international investment sphere and the disciplines relevant to such liberalisation should develop in the shadows of the world trade regime? In sum does an FTA configuration of trade and foreign investment contribute to coherence in trade, investment and development, or does it tend to distort the setting for an optimum foreign investment arrangement? All three NEA States have included in some of their FTAs investment chapters, for example the China-Korea FTA; Korea-Canada FTA and Japan-Australia FTA. This despite the fact that generally the domestic institutional setting for foreign trade and investment is not integrated. Foreign trade and investment is often the domain of different ministries. First, in economic analysis the relationship between trade and investment has been the subject of much analysis. This analysis has been both from the perspective of international trade and foreign investment, including flows of trade and investment.110 From the perspective of trade generally there is consensus about a positive synergy for international trade with foreign investment. Thus, (1) foreign investment can act as an alternative/substitute for foreign trade; (2) foreign investment can generate foreign trade, including trade to and from third c­ountries; (3) foreign investment can serve to protect a market built hitherto through

108  See Asif H Qureshi and Nohyoung Park, ‘The WTO as a “facilitator” in the harmonisation of domestic trade laws’ (2013) 8(1) Asian Journal of WTO & International Health Law and Policy 217–47. 109  s V.A of this chapter derives from Asif H Qureshi, ‘The FTA Paradigm for the Configuration of World Trade and Foreign Investment: The Case of Outward Processing Zones’ (Feb 2014) Journal of World Trade. 110  See for example ESCAP Studies in Trade and Investment 62—Towards Coherent Policy Frameworks: Understanding Trade and Investment Linkages. (2007), http://www.unescap.org/tid/artnet/pub/ tipub2469.pdf.

180  Free Trade in NEA

exports.111 In the same vein from the perspective of investment generally, there is positive relationship with increased foreign trade and trade policy practices. In particular: (1) FTAs facilitate in strengthening the investment environment; (2) FTAs facilitate reorganisation of industry and multinational corporations, so as to respond to locational advantages and economies of scale; (3) FTAs induce increased investment flows through a liberal trade environment, for example lower tariffs; (4) FTAs involve preferential rules of origin which in turn necessitate foreign investment, through local content requirements.112 The relationship between trade and investment however can also be ­problematic.113 For example: (1) where the foreign investment is in response to high tariffs (tariff jumping) lowering tariffs can negatively impact on foreign investment; (2) increased investment can inhibit domestic competition;114 and (3) trade related investment measures can distort international trade.115 There are several points that need to be noted about the economic analysis of the relationship between world trade and international investment in the context of its configuration in one setting. First, the general consensus on the complementarity of the two does not appear to shed a clear light on a comparative basis on the quantitative flows consequential upon the relationships between foreign trade and international investment ie, what the relative net advantage is for trade and investment flows respectively, consequential upon the relationship between the two, in the one setting. Second, the economic analysis is not clear on the locus of the benefits ie, whether in the home State/host State/third State; or the importing State/exporting State or third States. Third, given the possible market distortions that both trade and investment policies can induce in each other, the precise quantitative negative impact of such a relationship is not clear, nor offset against the advantages. Fourth, a segregated approach to investment policy is considered as being ‘sub-optimal’ given the belief that foreign direct investment (FDI) is ‘intimately linked’ to foreign trade, in that FDI can be both a complement to foreign trade, as well as a substitute to foreign trade.116 However, the fact of a relationship on its own does not per se call for foreign investment and world trade to be configured together, as opposed to being dealt with separately. Moreover, ‘sub-optimal’ does not appear to be defined nor empirically substantiated. Finally, the economic analysis is silent on the nature and quality of the enhanced foreign trade and investment generated. This is of course informed in aggregate terms by the coverage of the goods and services and the scope of the type of

111 

This analysis is drawn from ESCAP, ibid.

112 ibid. 113 

ibid, 201. ibid, 93–95. 115  See WTO TRIMS Agreement. 116  See for example European Parliament, Directorate-General For External Policies (study authored by S Woolcock and J Kleinheisterkamp, The EU Approach to International Investment Policy After the Lisbon Treaty (2010) 10). 114 

Some Reflections on Policy Considerations 181

i­ nvestment covered, in the particular trade and investment configuration. F ­ urther, in some measure the nature and quality of the enhanced trade in goods and ­services is informed by the use of the available filter of societal values found in the negative lists set out in general exceptions to liberal international trade, mirroring Article XX of the GATT 1994, including health and safety standards. This coverage even if taken into account is still somewhat silent on the precise nature and quality of the goods and services. In the foreign investment sphere generally, the filter is through the definition of the scope of the coverage of investment, including sectors excluded; along with specific references to health, safety, security and the environment. In international trade this is a discourse largely underpinned by the freedom of residents of one state to import and export according to their choice, and by market forces as embedded in the international liberal trade framework. The nature and quality of foreign investment however has a greater interface with national economic self-determination, fundamental societal values such as the environment, labour standards, human rights, cultural values, national security, strategic economic concerns, national competition and employment policies, national infrastructure planning, safety and health concerns, national economic vulnerability, and generally the national development agenda. Investment liberalisation touches more closely and significantly on Statehood, self-determination and national regulatory authority. The considerations that go into the liberalisation ethos of foreign investment, as much as the regulatory framework for investment, are different from those pertaining to trade. In sum, foreign investment calls for a greater degree of national management than does international trade.117 FTAs therefore may bring to bear their particular trade imprint onto the investment tower. Moreover, such a framework of FTAs creates asymmetrical procedural rights for trade and investment claimants. For example, in the US-Korea FTA, whereas trade disputes are settled as between the State Parties118 to the FTA, investors can still avail of International Centre for Settlement of Investment Disputes (ICSID) arbitration without the State Party being involved. Are there ethical concerns here?

C.  Reflections on Ethical Issues Concerned with FTAs Of late there has been much focus on international trade law from the perspective of justice.119 However, whilst FTA policy-making is generally well grounded

117 See Reclaiming Public Interest in Europe’s International Investment Policy: EU Investment ­ greements in the Lisbon Treaty Era: A Reader. The Transnational Institute on behalf of the Investment A Working Group of the Seattle to Brussels network (Amsterdam, July 2010) Ross Eventon at 25. 118  See Ch 22 of the US-Korea FTA. 119  See for example Chios Charmody, Frank J Garcia and John Linarelli (eds), Global Justice and International Economic Law (Cambridge, CUP, 2011); Frank J Garcia, Global Justice and International Economic Law Three Takes (Cambridge, CUP, 2013); Frank J Garcia, ‘Convergences: A Prospectus for

182  Free Trade in NEA

in economic/political analysis, there is surely the need for policy-makers to reflect on questions of justice—indeed inculcate it in their practice. After all, ultimately the legitimacy and sustainability of FTAs is informed by the manner in which they are understood to be fair. If ‘justice’ is defined as being concerned with the ‘relationship between a set of core political and social values about the distribution of benefits and burdens, and the outcomes of social processes’,120 justice ­questions in terms of FTAs arise disparately. Moreover, FTAs also raise wider ethical concerns. However, an expectation that relevant policy-makers should come to FTAs through ethical prisms may appear to be unrealistic. This is because, not only is the justice discourse fairly esoteric occupying a very specialist communication space, there are in fact a plurality of conceptions of justice serving different ends and informed by different civilisational traditions.121 Be that as it may, to reiterate, engagement in a justice discourse is necessary and needs to be inculcated in international trade policy-making. To this end an important aspect of this engagement in justice and broader ethical concerns is recognising the circumstances when it is necessary to engage in it. These can be considered as follows: 1. In deciding whether or not to enter into an FTA—ie, whether to take a ­multilateral or a non-multilateral approach to trade (choice of market liberalisation approach); 2. With respect to the choice of partners selected (choice of partners); 3. In the choice of market access proffered; 4. In the coverage of disciplines. First, there is a fundamental question in terms of the choice of market liberalisation approach. A multilateral approach is relatively more egalitarian in the ensuing distribution of the benefits of international trade as between members of the WTO, through the most-favoured-nation mechanism whilst making a special allowance for developing/least developed countries. On the other hand, FTAs that are regionally focussed respond to good neighbourly calls, which is also a facet of the self-development of the State itself. Such regionally-based FTAs may challenge the higher claim of a multilateral approach to international concerns from an ethical perspective. Second, the choice of FTA partners (excluding for the moment the good neighbours) involves a calculation in terms of economic/political advantage. However, precisely because it involves self-centred considerations it calls for an ethical reflection on the propriety of following the full logic of selfcentred e­conomic/political considerations. Moreover, given that the process involves selecting between different States it calls for a reasoned choice given that a

Justice in a Global Market Society’ (2016) 13(2) Manchester Journal of International Economic Law 128–51; Chios Carmody, ‘Theory and Theoretical Approaches to WTO Law’ (2016) 13(2) Manchester Journal of International Economic Law 152–85. 120 

See for example Garcia, Global Justice, ibid, 12. generally Garcia, ibid). See also Onuma Yasuaki, International Law in a Transcivilizational World (Cambridge, CUP, 2017). 121  See

Some Reflections on Policy Considerations 183

State that is not chosen will be at a disadvantage. It has been suggested that a choice of a partner because of its vulnerable capacity to negotiate requires a reflection on the question of raising the stature of the negotiating partner to a certain equivalent parity for a genuinely consensual agreement, if the FTA is to truly be a trade agreement as opposed to an exploitative enterprise.122 Are there ethical concerns involved in the design of FTA strategy in so far as choice of partners are concerned that adversely affects the FTA strategy of third States, particularly neighbouring States? Third, the nature and extent of market access involves a consideration of the distribution of benefits and burdens within the State, including a reflection on adjustment issues. There are here questions of distributive justice. However, there are also justice-based considerations with respect to the impact of the FTA within the partner State. For example, in the case of CAFTA (Central America Free Trade Agreement) the arrangement resulted in the elimination of the protection in place to safeguard small-scale farmers and exposing them to immediate competition from ‘highly subsidized US agricultural products.’123 Similarly, an agreement through its particular imprint of liberalisation that locks in a partner’s trade flows to serve the dominant economy, is not in the long-term interest of any State. In short, why should that partner’s domain be excluded from justice concerns? Is it really only the business of the other State? Are justice-based concerns pertaining to the partner State displaced by the fact of the negotiations for the FTA? Or are they engaged in the negotiations? It is unlikely however that the latter would be the case given existing practice which partakes of a market-based reciprocal bargain. Certainly, from a moral perspective there is no definite curtain of moral responsibility that falls one side of the State territory. Moreover, post-FTA establishment moral concerns of practices in the other State are covered through an exception category. If this is so covered then a fortiori it should also be a domain of concern during the negotiations. Alternatively, at the least there needs to be a reflection on whether all the participants affected and involved in the partner State have consented to the arrangement, or been involved in the shaping of the arrangement. Thus, Frank Garcia suggests for a consultative mechanism to be set up for the purposes of the negotiations.124 Finally, FTAs increasingly are expanding on the disciplines that are embedded in them. They are not only vehicles for harmonising important policies that engender an environment for freer/fairer and better trade and investment— they can also be, depending on the power ratio as between the negotiating parties to the FTA, vehicles for extraterritorial legislation and cultural hegemony. There is here a fine line between necessary harmonisation and legislative imperialism, the latter calling for self-restraint. Moreover, given FTAs can result also in inter-State cultural/social assimilation in their impact; and are increasingly being structured to be so (not just in the economic sphere), they not only enrich culturally/socially but can also displace and burden. 122 

See Garcia, ibid, 328 and 241. ibid, 247. 124 ibid. 123 

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In sum, engagement in FTAs calls for an appreciation of the various circumstances which involve an ethical approach, along with the inculcation of distributive justice. The latter could respond to a Rawlsian sense of fairness ie equality accompanied by the application of the differential principle. However, the equality would need to be substantive, and in the context of FTAs the differential principle need not simply be satisfied through separate systems of generalised preferences for developing/least developing countries—rather the principle may also have a bearing in FTA negotiations including in the choice of partners. For example, if the developing State is not a beneficiary in the respective Generalised System of Preferences, nor is it an important market or FTA hub, it can fall in a grey area where preferential treatment goes amiss.

VI. Conclusions FTA policy in NEA is individually being pursued in an environment of competition for markets and influence. By the same token FTA policy can be a uniting and harmonising force within NEA, if achieved. FTA policies need however to follow good practices—in particular embrace good governance and ethical concerns. The ‘Westphalian approach’ to FTAs is now anachronistic. Equally the beggarthy-neighbour FTA strategy is destructive and conflictual in the long run. Once again Europe has a lead here in the quality and depth in the design of its recent FTA strategy. Although this writer does not share Onuma Yasuaki’s pessimism125 about the capacity of NEA to be exemplary in civilisational attributes the general FTA practice in NEA despite its command in numbers of FTAs has room for development. FTAs are now important legislative vehicles in the economic sphere not just market creators. This privilege needs to be exercised with responsibility, an international spirit and having neighbourly regards. Moreover, there are complex legal issues that FTAs are generating. There is much that needs to be done to inject in this sphere simplicity and inter-FTA fairness.

125  Expressed at a session in the Asian Society of International Law conference held in S ­ eptember 2017 in Seoul, Korea.

Part Four

Conclusions

186 

Conclusions International Law emerged from societal relations in a region, and International Law remains foremost of relevance in its regional setting. Engaging in International Law within a regional dimension facilitates a more focused holistic analysis of the regional issues. Yet discourse on International Law generally tends to be abstract, universalist and with varying degrees of regional orientations. This is done in the belief that the practice of International Law is essentially an objective scientific enterprise. Such an approach has been conducive to provoking a divisive discourse placing west-centricity in International Law as an object of analysis in itself—even though ‘west-centric’ perspectives of International Law are not necessarily frozen in time, and are in a state of enlightement. However necessary as it may be to deconstruct International Law along these lines (and it is absolutely necessary to engage in such decontructionism) could it also be at the expense of focusing on the more pressing problems of our times? Does a regional focus not minimise such distractions and distortions in an International Law discourse? This locating of International Law in a regional setting needs to be juxtaposed with the transcivilisational perspective of International Law.1 This is because not only is it one of the most important and relevant of our times it is also one that originates from North East Asia (NEA). There are in fact no fundamental differences between the contextual perspective of International Law and the transcivilisational perspective. Indeed, a transcivilisational perspective is a serious challenge to the west-centric approach to International Law. Moreover, contextualism has the consequence of facilitating a transcivilisational perspective. Some observations are however proffered in terms of the contextual/regional approach adopted here. In principle the transcivilisational approach partakes of a process of contextualising International Law both in its development and application. The contextual approach to International Law is however in theory potentially wider in the scope of the considerations that it could encompass. The transcivilisational approach is more focussed on the development of International Law, whereas the contextual approach whilst not limited to the process of application alone is relatively more oriented in its focus on the application of International Law.

1  See for example Onuma Yasuaki, International Law in a Transcivilizational World (Cambridge, CUP, 2017) 19: ‘The transcivilizational perspective is a perspective from which people see, sense, (re)cognize, interpret, assess, and seek to propose solutions for the ideas, activities, phenomena and problems transcending national boundaries by adopting a cognitive and evaluative framework based on the recognition of the plurality of civilizations and cultures that have long existed throughout human history.’

188  Conclusions

The ­transcivilisational approach is essentially a discourse in international relations and philosophy, whereas the contextual approach is more grounded in the very nature of law/International Law. The transcivilisational approach advances civilisational claims, whereas the contextual approach advances more closely justice considerations. A transcivilisational approach is a response to a particular civilisational approach. A contextual approach is more focussed on intra-regional aspects of foreign relations. In this exploration of International Law in NEA justice has been an underlying narrative. Contextualism is a call of justice. Historical deconstructionism of west-centric perspectives of the origins and development of International Law are called for from the perspective of rectificatory justice. It may well be that the populist belief in the origins of International Law are set in Europe2 but this narrative is rejected. It is not the scholars function to accept the reality of such perceptions— rather it is to shed light on the errors of such perceptions however daunting the challenge! Indeed, European authors have themselves debunked this perception.3 There has to be a more considered contextualisation of International Law and domestic law both ways—wherein the rule of International Law is enabled in the domestic sphere, and domestic participation in foreign policy-making is facilitated. This inter-face is the nexus to achieving greater procedural justice and corrective justice to rein in abusive use of State power. In NEA the pursuit of rectificatory justice for historical conflicts is relevant and important. The justice pursued must partake of what I call ‘sustainable justice’, ie the rights of affected generations must be recognised but not at the cost of an existential threat to future generations far removed from those conflicts. Moreover the possibility of invoking other forms of justice (for example, distributive justice) to historical conflicts should not be ignored. Finally, the foreign economic sphere has to have a regional contextual dimension. Contextualisation here not only serves to facilitate better relations inter-se but distributive justice in the ‘home ground’. The adage ‘charity begins at home’ and religious edicts found in most religions about good neighbourliness are the first baby steps to engagement in justice. Nations that ignore this in the economic sphere need to reflect as to whether they are in fact engaging in ­beggar-thy-neighbour practices without really taking in substance a holistic and ­sustainable development approach to foreign economic relations.

2 

See for example Yasuaki, ibid, 11. See for example Alexander Orakhelashvili, ‘The Idea of European International Law’ (2006) 17(2) European Journal of International Law 315–47. 3 

INDEX

adjudication contextualisation, and  24–5 agencies of international law regional normative structures  22 Amnesty International  112 AMRO  134, 135–6, 137 Asada, M  115 ASEAN Plus 3 Macroeconomic Research Office (AMRO)  134, 135–6, 137 Asian Development Bank  159 Asian Peace and Friendship Fund for Women  105–6 Asian states attitude towards international law  13–14 Bank of Japan  139–40 Bank of Korea  139 Berkey, J  77 Bo-Young, C  168 Cançado Trindade, Judge  38, 48 central banks  138, 140–41 Bank of Japan  139–40 Bank of Korea  139 independence of  154 People’s Bank of China  138 Chan, P  55 Chesterman, S  13, 14 Chiang Mai Initiative Multilateralization (CMIM)  134, 135, 137 China relationship between international law and domestic law  67, 70 absence of international law in the Constitution  68 dualist approach  68–9 framework for international agreements  69–70 insulating the authority of the executive  68 interpretations of international agreements  69 state sovereignty  67–8 unequal treaties  68 China-Japan-Korea Free Trade Agreement (CJK FTA)  157, 169, 170 Christian values  12, 14, 15

CIL see Customary International Law CMIM  134, 135, 137 Collste, G  41 Combacau, J  16 comfort women  103–11 2015 agreement  109–11 Asian Peace and Friendship Fund for Women  105–6 call for sincere apology  111 demands of the comfort women  105 Japanese defences to legal charges  109 Japanese PM’s public apology  106 Japanese recognition of its involvement  105 waivers of liability  107 compulsory study of international law need for  2 Confucius  43 contextualising international law  17, 25, 28, 187, 188 adjudication  24–5 agencies of international law regional normative structures  22 differential treatment for developing countries  23 diverse nature of the subjects of international law  25 ex ante and ex post contextualisation of international law  26 ‘good faith’ requirement  19 international law norms contextual dimension  22–3 interpretation and contextualisation  17–19 need for regional contextualisation  9 sources of international law  19–22 Customary International Law (CIL)  9, 20, 21, 22, 23, 35, 36, 130, 131, 132, 133, 172 denuclearisation in the Korean peninsula  111–17 International Law on Nuclear Armament and Safety  113–15 law on armed conflict  113 National Security Law (Korea)  111–12 UN Security Council Resolutions  115–16 differential treatment for developing countries  23

190  Index dissemination of western interpretations of international law into NEA  51–3 reception of  53 distributive justice  41, 119, 126, 148, 149, 150, 152, 174, 183, 184, 188 Dokdo / Takeshima islands dispute  95–9 domestic legal system relationship with international law  62–3, 66–7, 81 China  67–70 deeper integration of the two systems  64–5 direct applicability of international law  64 domestic courts reluctance to rein in the executive  65 greater participation in foreign policy / treaty-making  63–4 historical / political antecedents of constitutions  67 Japan  79–80 Korea  71–9 monist / dualist approach  65–6 need for constitutional changes  2–3 state and individual rights  67

national legal frameworks China  167 Japan  166–7 Korea  165–6 negative impacts of  160 objectives of  168–9 policy considerations  178, 184 configuration of both trade and foreign investment in FTAs  179–81 ethical issues  181–4 regulatory harmonisation  178–9 Regional Comprehensive Economic Partnership  157, 170, 171–2 sectors covered in  168 spirit and approach of the parties to  168–9 Fuller, L  17, 21, 24

economic analysis addressing historical conflicts  118 Eeckhout, P  77 ‘European International Law’  12, 13, 15 ex ante and ex post contextualisation of international law  26

Hagan, S  131 Higgins, R  33, 34, 36 historical inter-se and external relations in NEA  53–4 Japanese colonial engagements  56–8 post-war justice  61 post-World War Two  59–60 reparations  60 unequal treaties  54–5 war crimes  58, 59, 60 historical narratives historical accounts as aspect of justice  29 recognising the possibility of different narratives  1–2, 29 historically rooted disputes  31–2, 85–7 approaches to addressing historical conflicts  118, 119–20 distributive justice  119 economic analysis  118 forgiveness  118–19 sustainable justice  119 comfort women  103–11 2015 agreement  109–11 Asian Peace and Friendship Fund for Women  105–6 call for sincere apology  111 demands of the comfort women  105 Japanese defences to legal charges  109 Japanese PM’s public apology  106 Japanese recognition of its involvement  105 waivers of liability  107

forgiveness addressing historical conflicts  118–19 free trade agreements (FTAs)  156, 157, 158 China  157 China-Japan-Korea Free Trade Agreement  157, 169, 170 development of  156 international legal framework  172 Customary International Law  172 General International Law  172 General Principles of Law  172 relationship between FTAs and the WTO  174–5 right to discriminate in international trade and investment  173–4 WTO disciplines  175–8 Japan  157 Korea  157 legal nature of  168 literature on  158–9 national FTA strategies  161, 164–5 China  163, 164 Japan  161–3 Korea  161 public disclosure of  163–4

Garcia, F  151, 152, 183 General International Law  35, 55, 71, 80, 172 General Principles of Law  35, 36, 80, 172 Geneva Conventions on the Law of the Sea  87 geographical encapsulation of the region  7 Ginsburg, T  64 ‘good faith’ requirement  19

Index denuclearisation in the Korean peninsula 111–17 International Law on Nuclear Armament and Safety 113–15 law on armed conflict 113 National Security Law (Korea) 111–12 UN Security Council Resolutions 115–16 Dokdo / Takeshima islands dispute 95–9 NEA sea importance of 88 unresolved issues 88 Senkaku / Diaoyu islands dispute 99–103 see also law of the sea Holland, T 56 IAEA 113, 114, 115 ICJ see International Court of Justice ICSID 181 ILC 15, 16, 57, 63 IMF see International Monetary Fund inter-State relations in the pre-modern period 42–4 existence of international law 46–9 Tribute System 44, 47 inter-temporal law 32, 33, 34, 35 International Atomic Energy Agency (IAEA) 113, 114, 115 International Centre for Settlement of Investment Disputes (ICSID) 181 International Court of Justice (ICJ) 18, 19, 20, 21, 23, 24, 25, 37, 38, 113 consent to the jurisdiction of 34, 94 International Law Commission (ILC) 15, 16, 57, 63 International Law on Nuclear Armament and Safety 113–15 International Monetary Fund (IMF) 123, 129, 130, 131, 132, 133, 134, 136, 147, 150, 151, 153, 154, 155 central banks, and 138 surveillance reports 127 see also regional monetary relations international organisations principle of speciality 25 international reserve currency 151–4 International Tribunal for the Law of the Sea 94 interpretation contextualisation, and 17–19 Iriye, K 46 island status 96, 100 Japan Japanese colonial engagements 56–8 military sexual slavery 104, 105 relationship between international law and domestic law 79–80 see also comfort women

191

Jennings, R 40 Ju, J-Y 75, 76 jus cogens 39 Kim, Mr (smuggling case) 73, 74 Korea relationship between international law and domestic law 71–2, 78–9 constitutional arrangements for treaty-making, implementation and foreign policy practice 78 direct applicability of WTO agreements 72–8 monist approach 71 Korea Ministry of Trade Industry and Energy A New Trade Roadmap 161 Koromo, Judge 39, 40 Koskenniemi, M 49, 50 Kotzur, M 35, 37, 39 Lang, A 49 law of the sea 87 Chinese legislation and claims 88–9 demarcation of the various maritime zones in the seas of NEA 92–4 International Tribunal for the Law of the Sea 94 interpretation and application of the law 91–2 Japanese legislation and claims 91 jurisdiction of the ICJ 94 Korean legislation and claims 89–91 law on armed conflict 113 Legality of the Threat or Use of Nuclear Weapons 18–19 lex posterior derogate legi priori 40 lex specialis derogat generali 40 literature on international law 27 Mandela, N 118 Martin, W 15, 45, 52 McDougall, G 104, 105, 108, 109 media free and independent, need to be 2 monetary sovereignty 131, 132 see also regional monetary relations Moon Jae-in 110, 111 neighbourliness 2, 147, 188 non-retroactivity principle 32, 33, 35–7, 39, 40 North East Asia concept of 7, 8 North Korea international relations 27 Nozick, R 41 OECD 167 Onuma Yasuaki 10, 11, 51, 184

192

Index

Orakhelashvili, A 15 Organisation for Economic Co-operation and Development (OECD) 167 origins of international law 44–5 Owada, Judge Hisashi 45 pacta sunt servanda 65 Park, N 76 Park Yu-ha 103 People’s Bank of China 138 prohibition to harm another State’s economy 130–33 Public International Law of Internal Affairs

1

racial discrimination effective national legislation, need for 2 Rawls, J 9, 41, 119, 148, 149, 152, 153, 184 RCEP 157, 170, 171–2 rectificatory justice 3, 29, 30, 31, 40–42, 45, 61, 118, 119, 152, 188 see also ‘sustainable justice’ regimes of international law existing in NEA 49–51 Regional Comprehensive Economic Partnership (RCEP) 157, 170, 171–2 regional monetary relations 154–5 ASEAN Plus 3 Macroeconomic Research Office 134, 135–6, 137 availability of liquidity in an emergency 149–50 challenges for international law 126 Chiang Mai Initiative Multilateralization 134, 135, 137 Chinese perspective on monetary cooperation 128 competitive devaluation 148–9 currency exchange arrangements 134 economic inter-dependence of the NEA countries 127 ethical considerations 147–54 export market competitors 127 extent of trade and investment between NEA countries 126–7 functions of international law 125–6 IMF law and regional monetary arrangements 142–7 availability of liquidity on a discriminatory basis 142 enhancing regional trade 143 exchange rates co-operative arrangements 142 obligation to promote regional monetary cooperation 143–6 Regional Economic Outlook (REO): Asia and Pacific 146 reserve assets 142–3 instilling appropriate disciplines in transmission channels 154

international reserve currency 151–4 Japanese perspective on monetary cooperation 128–9 justice discourse 147–54 link between monetary policies of the states of NEA 128 monetary framework 129, 130 monetary sovereignty 131, 132 national monetary regimes’ regional impact 137 central banks 138–41 exchange rate and foreign exchange interventions 141 foreign exchange control regimes 137 need to improve co-operation 124, 128 political initiatives 124–5 prohibition to harm another State’s economy 130–33 reserve assets 150–51 swap arrangements 133 regionalism 11 relationship between international law and regionalism 11–17, 27–8 relativism 10 reparations 60 Rhadika, C 104, 105, 106, 108 rock status 96 San Francisco Peace Treaty (1951) 60 Senkaku / Diaoyu islands dispute 99–103 Shanghai ASA Ceramic Co 76 Shi, Judge 39, 40 Simma, B 16 social engineering need for 1 societies of international law 14 sources of international law context, and 19–22 State immunity 37–9 subjects of international law diverse nature of 25 ‘sustainable justice’ 4, 29–30, 33, 37, 42, 87, 119, 188 Svarverud, R 48, 52 Takeshima / Dokdo islands dispute 95–9 TCS 8 territorial acquisition, modes of 95 Tieya, W 46, 55 time of the applicable law ‘long enough time’ 33, 34 ‘now and then’ 33, 34 ‘then and now’ 33, 34, 35 ‘too long ago’ 33, 34, 35 transcivilisational perspective of international law 187, 188 Treaty on the Non-Proliferation of Nuclear Weapons (NPT) 113, 114, 115, 116

Index Tribute System 44, 47 Triggs, G 13, 14 Trilateral Cooperation Secretariat (TCS) Trump, D 44

8

Uemura, T 103–4 UN Economic and Social Commission for Asia and the Pacific 8 UN Human Rights Council (UNHRC) 104, 110 UN Security Council Resolutions 20, 115–16 unequal treaties 54–5, 68 United Nations Convention on the Law of the Sea (UNCLOS) 87 universal international law 12, 13, 15, 16 universities need for greater diversity 2 uti possidetis juris principle 22 Vienna Convention on the Law of Treaties (VCLT) 175, 177

war crimes 58, 59, 60 see also comfort women Watts, A 40 Wheaton, H 14, 15, 45, 51–2 World Trade Organization (WTO) 167 free trade agreements Committee on Regional Trade Agreements 160 relationship between FTAs and the WTO 174–5 Transparency Mechanism 160 WTO disciplines 175–8 Korea direct applicability of WTO agreements 72–8 see also free trade agreements Yanagihara, M 50 Young, LS 168 Yusuf, Judge Abdulqawi A 39

193

194