Philippine Supreme Court Ruled South China Sea Energy Agreement Invalid

According to reports, the Supreme Court in the Philippines declared Tuesday that the country’s 2005 energy development agreement with the Communist China and Vietnamese companies was illegal, ruling that the constitution does not allow foreign entities to exploit natural resources. The agreement was signed in 2005, but expired long ago in 2008, and the Supreme Court did not explain why it took fourteen years to rule on the related ruling application.

The agreement involves a deal between the state-run Philippines National Oil Company, China National Offshore Oil Corp and Vietnam Oil and Gas Corporation. The court ruled that this was illegal because the country of the Philippines is constitutionally required to control and supervise these activities and the participating company must have the Philippines as the majority holder.

Philippine President Ferdinand Marcos, prior to his visit to China last week, said that even without the expertise provided by the Chinese government, the Philippines must find a way to tap into the pristine energy resources in its exclusive economic zone.

There has been an ongoing issue of maritime sovereignty between Communist China and the Philippines, with the Chinese Communist Party claiming that it has jurisdiction over almost the entire South China Sea. The Philippines has the ruling of the International Court of Arbitration in its favor. However, due to the CCP’s intimidation, it is difficult for the Philippines to find foreign companies willing to participate in the cooperation.