Australia has one of the largest maritime areas in the world, established by its continental shelf claims and by agreement with all of its other maritime neighbours, including Indonesia, Papua New Guinea, France (New Caledonia and Kerguelen Islands), Solomon Islands and New Zealand. However, Australia has so far been unwilling to enter into negotiations with Timor-Leste for a permanent maritime boundary, which represents just 2% of a complete Australian maritime boundary.
The early days of Timorese nationhood and Australia’s carve-out
Between the historic vote for independence in 1999 and the restoration of independence in May 2002, the United Nations was responsible for administrating East Timor, as Timor-Leste was known at the time. During this transitional period, in July 2001 Australia and the United Nations Transitional Administration in East Timor (UNTAET) signed a resource-sharing arrangement in the Timor Sea.
The agreement purported to give Australia rights over resources extending up to the Timor Trough, around 50 nautical miles from Timor-Leste’s shores – far beyond what Australia would have been entitled to under international law if a maritime boundary was drawn by applying the equidistance / relevant circumstances approach.
In March 2002, just two months before Timor-Leste’s independence was restored, Australia withdrew from the maritime boundary jurisdiction of the International Court of Justice and the International Tribunal for the Law of the Sea. This meant the new nation of Timor-Leste could not ask an international court to decide where an equitable boundary would lie under international law in the Timor Sea if it was unable to reach agreement with Australia.
The new nation of Timor-Leste signed the Timor Sea Treaty with Australia on its first day of independence, 20 May 2002.
Australia’s alleged espionage and seizure of Timor-Leste’s documents
Australia and Timor-Leste then negotiated additional treaties to set terms for revenue-sharing and regulatory control in the Joint Petroleum Development Area and in the Greater Sunrise field which extended into waters claimed by Australia under the outdated continental shelf theory. Between 2004 and 2006 Timor-Leste and Australia negotiated the terms of the Treaty on Certain Maritime Arrangements in the Timor Sea (CMATS) and the Agreement between the Government of the Democratic Republic of Timor-Leste and the Government of Australia relating to the Unitisation of the Sunrise and Troubadour Fields (Unitisation Agreement).
After obtaining evidence of an espionage operation by Australia during CMATS negotiations, Timor-Leste challenged the validity of CMATS and the amended Timor Sea Treaty at the Permanent Court of Arbitration.
On 3 December 2013, Australian security intelligence officers seized Timor-Leste’s documents and data which were in the possession of one of Timor-Leste’s lawyers, including legal documents relating to the arbitration which was underway between the two States. The Australian Government refused to return these materials. Timor-Leste commenced proceedings in the International Court of Justice seeking a declaration that the seizure and detention of such materials was unlawful.
On 3 March 2014, the International Court of Justice handed down interim orders which went beyond Timor-Leste’s expectations and ordered Australia not to interfere in the communications between the Timor-Leste Government and its legal advisers. Australia has since recognised the need for all States to respect the confidentiality of communications between States and their legal advisers.
In September 2014, Timor-Leste and Australia agreed to suspend both the espionage arbitration and document seizure case for six months in order to reach an amicable settlement of their dispute. No agreement was reached in that time. While Timor-Leste sought to engage with Australia in structured negotiations on permanent maritime boundaries, Australia expressed its unwillingness to discuss the permanent maritime boundary issue.
On 12 May 2015, over one year after the raid on Timor-Leste’s legal offices, Australia returned the seized documents and data. Having achieved this positive result, Timor-Leste discontinued the document seizure proceedings in the International Court of Justice.
The continental shelf comprises the seabed and subsoil beneath it. Under UNCLOS, a coastal State is entitled to a continental shelf which extends to at least 200 nautical miles from a State’s baselines. In some cases (for instance where there are no overlapping claims by another State), a State can claim an extended continental shelf beyond 200 nautical miles where there is a ‘natural prolongation’ of the shelf. Australia has recognised continental shelf claims beyond its 200 nautical mile Exclusive Economic Zone in certain parts of its coastline.
International Court of Justice (ICJ)
The main court of the United Nations, also popularly known as the ‘World Court’. Only States (i.e. countries) can be a party to proceedings before this court. The United Nations Convention on the Law of the Sea gives the International Court of Justice jurisdiction to hear maritime boundary disputes between countries. The International Court of Justice is located at The Hague in the Netherlands.
Joint Petroleum Development Area (JPDA)
The area in the Timor Sea which was established by the Timor Sea Treaty between Australia and Timor-Leste in 2002. In this area, exploration and exploitation of petroleum resources is jointly controlled and managed by Timor-Leste and Australia.
Permanent Court of Arbitration (PCA)
An international dispute settlement body. The Permanent Court of Arbitration hears maritime boundary disputes and a range of other disputes related to treaties and investments. States will go to the Permanent Court of Arbitration when they are unable to resolve their dispute amongst themselves. The Permanent Court of Arbitration sits at The Hague in the Netherlands. The Timor Sea Treaty Arbitration between Australia and Timor-Leste is being heard by a tribunal which sits at the Permanent Court of Arbitration.
The equidistance / relevant circumstances approach
The modern approach taken by the International Court of Justice (and other major maritime boundary dispute resolution bodies) to determine maritime boundaries for countries with overlapping Exclusive Economic Zones. The International Court of Justice and International Tribunal for the Law of the Sea use this approach.
There are three steps to the approach:
1. draw a provisional equidistance line (i.e. the half-way point between each of the two countries);
2. adjust the provision equidistance line for any relevant circumstances (such as the presence of islands, the effect of concave or convex coasts and the disparity in coast lengths, among other circumstances); and
3. check that there is no disproportion between the ratio of the respective coastal lengths and the ratio between the relevant maritime area of each State by reference to the delimitation line.