An international tribunal on Tuesday ruled against China in a bitter row over territorial claims to the South China Sea that is likely to ratchet up regional tensions.

"The tribunal concluded that there was no legal basis for China to claim historic rights within the sea areas falling within the 'nine-dash line', the Permanent Court of Arbitration said in a statement.

Source: AFP

Here's what you need to know about the ruling:

In January 2013, The Philippines formally lodged its arbitration case under the United Nations' 1982 Convention of the Law of the Sea, known as UNCLOS. The country's 15-point case asked the tribunal to rule on the status of China's so-called 'nine-dash line', a boundary that is the basis for its 69-year-old claim to roughly 85 percent of the South China Sea.

China reacted angrily to the verdict. Xinhua, the country’s official news agency, hit out at what it described as an “ill-founded” ruling that was “naturally null and void”.

Why did China refuse to take part in the case?

China boycotted the hearings at the Permanent Court of Arbitration, saying it does not have jurisdiction to decide on the matter. It also attempted to discredit its work as biased by pointing to the fact that a judge from China’s regional rival Japan was involved in its creation.

China also regards the disputes as a purely Asian problem that outsiders like the U.S. have no right to meddle in.

An aerial photo taken though a window of a Philippine military plane shows Spratly Islands in the South China Sea/Source: Reuters

Why is this ruling important?

It's the first time any legal challenge has been brought in the South China Sea territorial dispute. The dispute had intensified political and military rivalry across the region between the rising power of China and the long-dominant player, the United States.

China has been projecting its growing naval reach while the United States is deepening ties with both traditional security allies such as Japan and the Philippines and with newer friends, including Vietnam and Myanmar.

Why did China want to control the South China Sea?

Scientists believe that the seabed could contain unexploited oil, gas and minerals, which would be a boon to any country that can establish their claims to the region's waters, especially in resource-hungry Asia. It's also home to abundant fisheries that feed growing populations.

Source: Reuters

Control of the South China Sea would have allowed China to dominate a major trade route through which most of its imported oil flows. It would also have allowed China to disrupt, or threaten to disrupt, trade shipments to all countries in East and Southeast Asia — as well as deny access to foreign military forces, particularly the United States.

Who were disputing it?

Everyone surrounding the sea -- Vietnam, Malaysia, the Philippines, tiny Brunei, Taiwan and, most significantly, China -- lay claim to some part of it. Washington had also become deeply involved, backing those against China. It said the waters are international and regularly sent its warships there on so-called "Freedom of Navigation" missions.

What now?

The ruling stands to further ramp up tensions in the region, where China's increased military assertiveness has spread concern among its smaller neighbours and is a point of confrontation with the United States. A victory for the Philippines can now spur Taiwan, Vietnam, Malaysia and Brunei, which also have overlapping claims, to file similar cases.

(With Inputs from Reuters and AFP)