building food security in asia through international ......2 building food security in asia through...

Kunmin Kim, Task Manager, ADBIPaula P. Plaza, Litigation Lawyer, Angara Abello Concepcion Regala & Cruz Law Offices (ACCRALAW)1

Building Food Security in Asia through International Agreements on Rice Reserves

briefpolicy

Key Points • TheASEANmemberstates

enteredintolegallybindingagreementsestablishingricereservestomitigatetheimpactofnaturaldisastersandmajorcalamitiesonfood security.

• Todate,thepartieshaveenteredintotheAgreementontheASEANFoodSecurityReserve(AFSR)Agreementanditstwoprotocols,andtheASEANPlusThreeEmergencyRiceReserve(APTERR)Agreement.

• Anydisputesrelatingtotheinterpretation,application,orimplementationoftheAFSRAgreementareresolvedthroughtheprocedureinthe2004ASEANProtocolonEnhancedDisputeSettlementMechanism.ThoseundertheAPTERRAgreementareresolvedthroughthemechanisminArticleIX.Todate,thesemechanismsremainuntested.

• Tobuildandsustainthemomentumgainedforthericereserves,itissuggestedthatASEANmemberstates:(i)increasecooperationandfinancialsupportfortheAPTERR;(ii)increasethespeedofnegotiation,coordination,andresponseforemergencyfoodaidreleases;(iii)eliminatetheconsensusrequirementforAPTERRCouncildecisionsindisputes;and(iv)incorporateanenforcementandcompliancemechanismforAPTERRCouncildecisions.

No. 2018-1 (August)

© 2018 Asian Development Bank InstituteISSN 2411-6734

This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

Policy Workshop on Food Security and Disaster Risk Reduction in Asia16–18 January 2018 Bangkok, Thailand

Organized by the Asian Development Bank Institute, the ASEAN Plus Three Emergency Rice Reserve, and the ASEAN Food Security Information System.

Through the years, Asian states have forged relationships to achieve foodsecurity by establishing emergency food reserves (Briones et al. 2012). Theserelationshipsareinstitutionalizedinjointstatements,declarations,andagreementsof intergovernmentalorganizations (Hirano1996).Theoutcome is topreserveandenhancedevelopmentandstabilityintheAsianregion.

What are these instruments?Do theyhavebinding force?How shouldhistoricallynonconfrontational states resolvedisputesandenforcedecisions?ThispolicybriefoutlinestheinstitutionalhistoryoftheAgreementontheAssociationofSoutheastAsianNations(ASEAN)FoodSecurityReserve(AFSR)AgreementandtheASEANPlusThreeEmergencyRiceReserve(APTERR)Agreement,anddiscussestheirkeyfeatures,bindingforce,anddisputeresolutionmechanisms.

Itconcludeswithananalysisoftheirefficacyandthefollowingpolicyimplications:First,thecurrentAPTERRstocksareinadequatetomeetitsobjectives.Partiesshouldincrease cooperation and financial support for the APTERR. Second, the partiesshould increase the speed of negotiation, coordination, and response for acuteandemergency foodaid (Tier3) releasesafteracalamity.Third, thepartiesshouldeliminate the consensus requirement for APTERR Council decisions in disputes.Finally,thepartiesshouldincorporateanenforcementandcompliancemechanismforAPTERRCouncildecisions;otherwise,itsdecisionswouldremainpyrrhicvictories.

Background on the Association of Southeast Asian NationsOn 8 August 1967, five countries (Indonesia, Malaysia, the Philippines, Singapore,andThailand)establishedASEANasanassociationforregionalcooperation.ASEAN

1 TheviewsandopinionsexpressedinthisbriefarethoseoftheauthoronlyanddonotreflecttheviewsofACCRALAW.

ADBI Policy Brief No. 2018-1 (August) 2

further expanded its membership to include BruneiDarussalam, Viet Nam, Myanmar, the Lao People’sDemocraticRepublic,andCambodia.

The aim, purpose,machinery, and rules governing themembership of this intergovernmental organizationwere enshrined in the 1967 ASEAN Declaration (orBangkokDeclaration).Init,themembersacknowledgedthe existence of their mutual interests and commonproblems and their responsibility to strengthen theeconomicand social stabilityof the region.Oneof theobjectivesof theorganizationwas to collaboratemoreeffectively for the greater utilization of agriculture toraiselivingstandards(ASEANDeclaration,ArticleII.5).

On 24 February 1976, ASEAN issued the Declarationof ASEAN Concord. This expanded the definition of“cooperation” to include the elimination of hunger asoneofitsprimaryconcerns(paragraph3)andrecognizedthatnaturaldisastersandmajorcalamitiescanretardthedevelopmentofstates(paragraph4).

Agreement on the ASEAN Food Security ReserveTo mitigate the impact of natural disasters on foodsecurity,ASEANestablishedaricereserveon4October1979.Thericereservewasdevelopedtoalleviatepovertyandtoeradicatemalnourishmentintheregionwithoutdistortingnormaltradeintheglobalmarket.ThefirstfiveASEANmembers signed the AFSR Agreement creatingthe ASEAN Emergency Rice Reserve (AERR). The AFSRAgreement entered into force—that is, became legallybinding—on24July1980(ArticleIX.3).

The key components of the AFSR Agreement are asfollows:TheAERRwascomposedofearmarkedquantitiesofrice(ArticleIV.3)thateachcountrypromisedtomakeavailable to members in an emergency situation. Theinitialamountofearmarkedricewas50,000metrictons(ArticleIV.2).AmembermayaccesstheAERRonlyafteradeclarationofastateofemergency.UnderArticleIV.5oftheAFSRAgreement,threerequisitesmustbepresentbefore a state is considered to be in an “emergencycondition”:Itmustsufferextremeorunexpectednaturalorhuman-inducedcalamity,beunabletocopethroughitsnational foodreserve,andbeunable toprocure thefoodsupplythroughnormaltrade.

The release of rice from the AERR must follow theprocedural outline inArticleVof theAFSRAgreement.

First, the country in need must notify other membersof the emergency and the amount of rice required.Second, countries negotiate bilaterally on the prices,terms, and conditions of payment.Third, the countriesmake the necessary arrangements for the release ofrice. Finally, the member in need informs the ASEANFood Security Reserve Board (AFSRB) of its request(ArticleV.5).

The AFSRB supervises and coordinates theimplementation of the AFSR Agreement (Article VIII).It is composed of one representative of eachmemberstate(ArticleVIII.2),anditsobligationsarecodifiedinthetermsofreferenceannexedtotheAFSRAgreement.

One of the obligations of the AFSRB is to review theimplementation of the AFSR Agreement (paragraph6). However, the AFSRB has no authority to imposepenaltiesonmemberswho fail toearmark their riceorcomplywiththeircommitments.

Protocols I and II of the Agreement on the ASEAN Food Security Reserve

On 22 October 1982, ASEAN amended the AFSRAgreement by expanding the powers of the AFSRB toinclude the authority to facilitatebilateral negotiationson prices and other conditions of long-term ricecontracts (AFSR Protocol I). On 23 July 1997, ASEANfurther amended the AFSR Agreement: first as regardsmembership with Brunei Darussalam and Viet NamjoiningASEANandbecomingpartiestoitsmajortreaties;andsecond,asregardsincreasingtheinitialquantityofearmarkedricefrom50,000to67,000metrictons(AFSRProtocol II, Article II). Finally, the AFSRB must submitreportsofitsactivitiesandrespondtotheSeniorOfficialsMeeting of the ASEAN Ministers on Agriculture andForestry(AFSRProtocolII,ArticleV).

Resolution of Disputes

The AFSR Agreement created legally bindingobligationsforitsparties.Underinternationallaw,theselegal obligations are known by a variety of names,ranging from conventions and agreements to statutes,declarationsandcovenants(Hudson1931;Evans1995).Irrespective of the name used, all transactions referto written agreements where states intend to bindthemselves legally—toact inaparticularwayor to setupspecificrelationsbetweenthemselves(Shaw2008).

Building Food Security in Asia through International Agreements on Rice Reserves2 3

IncaseofadisputeregardingtheAFSRAgreement,theparties may resolve it through the procedures in the2004ASEANProtocolonEnhancedDisputeSettlementMechanism (EDSM). The AFSR Agreement and itsProtocol II are included in theAppendix I listofEDSM-coveredagreements.

Under Article III.2 of the EDSM Protocol, a state mayresort todispute resolutionwithanother state in threeinstances:abenefitaccruingtoitisnullifiedbecauseoftheactsof theotherstate, theotherstate’sacts impairthe object and purpose of the agreement, and anyanalogous situation. As far as possible, all differencesmust be settled amicably between the states throughconsultation (Article III). A request for consultation ismadebyinformingtheotherstateaswellastheSeniorEconomicOfficialsMeeting(SEOM).

If the dispute remains unresolved, the SEOM, uponrequest, may establish a panel to resolve it (EDSMProtocol,ArticleV).Thepanelwillmakeanassessmentofthedisputeandmakerecommendationsonthecase(ArticleVII),whichareencapsulatedinthePanelReport.

The SEOMmay adopt the Panel Report and terminatethecase (EDSMProtocol,Article IX).However, if a statedisagreeswiththedecision,itmayappealtoanAppellateBody established by the ASEAN Economic Ministers(ArticleVII).TheAppellateBodymayuphold,reverse,ormodify the legal findingsandconclusionsof thepanel(ArticleIX.12).

AfterafinaldecisionismadeundertheEDSM,statesmustimmediatelycomplywiththedecisionofthepaneland/orAppellateBodyadoptedbytheSEOM(EDSMProtocol,ArticleXV).Ifastaterefusestocomplywiththedecision,itwillbe subjected to suspensionofconcessionsorberequiredtopaycompensation(ArticleXVI).

Nonutilization of the Agreement

In its 30-year existence, the AERR stocks were neverutilized (Trethewie 2013), and the EDSM disputeresolutionmechanismwasnevertested.

The case of Indonesia in 1997–1998 particularlyhighlighted the weaknesses of the AERR. Indonesiaexperienced serious food shortage problems anddrastically increasedits importsduetoElNiño-induceddrought and forest fires. Technically, this qualified asan“emergency condition” under the AFSR Agreement.

However, instead of utilizing the AERR, Indonesiaobtained a loan from the InternationalMonetary FundandWorldBank(Yoshimatsu2014).

Policy makers noted the weaknesses of the AFSR andexerted efforts to revolutionize their policies andprogramstoenhancefoodsecurityintheregion.

ASEAN Plus Three

ASEANacknowledgedthatregionaldevelopmentdidnotoccur in a vacuum; countrieswould benefit immenselyfrom strengthening and deepening relationswith theirEastAsianneighbors.

Consequently,theASEANPlusThreewasborn,composedoftheASEANmemberstatesplusthePeople’sRepublicofChina,Japan,andtheRepublicofKorea.ThiscollaborationwasinstitutionalizedthroughtheJointStatementonEastAsiaCooperationissuedon28November1999.

East Asia Emergency Rice Reserve

On11October2002, theASEANPlusThreeannouncedthe launchof its pilot project: the EastAsia EmergencyRice Reserve (EAERR). This was based on an earlierprototype of the regional reserve, which was initiatedandsupportedbyJapan(Trethewie2013).

ASEAN Plus Three Emergency Rice Reserve AgreementOn 7 October 2011, the ASEAN Plus Three EmergencyRice Reserve (APTERR) Agreement was signed by the10 ASEAN member states, the People’s Republic ofChina, Japan, and the Republic of Korea. The APTERRAgreemententered into forceon12 July2012 (Briones2012).

On28October2012,thepartiesagreedbyconsensustolocatetheAPTERRSecretariatofficeinThailandpursuanttoArticleVIIIoftheAPTERRAgreement.

Thefollowingyear,theAPTERRwasofficiallyestablishedasapermanentmechanism,andtheAPTERRSecretariatbeganitsoperations.Duringthefirst5years,theactivitiesof the Secretariat were supported by the operationalcost account funded by the APTERR parties. This wascomplemented by the Endowment Fund to provide


long-term financial support (APTERR Agreement,Article VI.2). The breakdown of the operationalcosts and the Endowment Fund are illustrated inTables1and2.

The key components of the APTERR Agreement areas follows: first, the APTERR was established to meetemergency requirements and to achieve humanitarianpurposes (Article III.1a). It retained the AFSR definitionof an “emergency condition” (Article I.e). Second,unlike theAERR,which comprisedonly earmarked rice(AFSR Agreement, Article IV.3), the APTERR consists ofearmarkedriceandphysicalricestocks.TheAPTERRhasanearmarkedemergencyreserve,stockpiledemergencyricereserveofcashandrice,andotherformsofreservesuch as future contracts or donations in cash or kind(ArticleIII.2).

The stocks are made available through a three-tiersystem: Tier 1 – special commercial contracts or sales;Tier2–emergencygrantsandloans;andTier3–donatedriceintimesofacuteemergencies(Trethewie2013).

1. Earmarked Emergency Rice Reserve

Thisisacertainquantityofmilledriceand/orprocessedricethat isvoluntarilydesignatedbythepartiesforthepurposeofmeetinganemergency requirementofoneormoreoftheparties(APTERRAgreement,ArticleI.d).

The total earmarked emergency rice reserve of theAPTERRis787,000metrictons;itsbreakdownisillustratedinTable3.

2. Stockpiled Emergency Rice Reserve

This is a reserve in the form of cash and/or in-kind(rice), which, if necessary, may be donated throughappropriate international organizations and/ornongovernment organizations. This stockpiled reserveisusedasanemergencystocktoprovidepreparednessforanemergencysituationsuchasanaturalcalamityorfor poverty alleviation or malnourishment eradicationprograms.

Table 1: Annual Contribution to the Operational Costs, 2012–2016

ASEAN Member States

Contribution to the Operational Costs

(inUS$)BruneiDarussalam 8,000Indonesia 8,000Malaysia 8,000Philippines 8,000Singapore 8,000Thailand 8,000VietNam 8,000Cambodia 6,000LaoPeople’sDemocraticRepublic 6,000Myanmar 6,000

Plus Three Countries

Contribution to the Operational Costs

(inUS$)People’sRepublicofChina 75,000Japan 75,000RepublicofKorea 75,000Total 299,000 per annum

ASEAN = Association of Southeast Asian Nations.

Source: ASEAN Plus Three Emergency Rice Reserve Agreement. 2011. Attachment 2.

Table 2: Capital Contribution to the Endowment Fund

ASEAN Member States

Contribution to theEndowment Fund

(inUS$)BruneiDarussalam 107,500Indonesia 107,500Malaysia 107,500Philippines 107,500Singapore 107,500Thailand 107,500VietNam 107,500Cambodia 83,000LaoPeople’sDemocraticRepublic 83,000Myanmar 83,000


Contribution to theEndowment Fund

(inUS$)People’sRepublicofChina 1,000,000Japan 1,000,000RepublicofKorea 1,000,000Total 4,001,500




To facilitate the implementation of obligations, thememberscreatedaRiceInformationExchange(APTERRAgreement, Article V). They agreed to provide theSecretariat with regular reports and information onpolicies, programs, food security, and other aspects offood supply (Article V.1). The data are appraised andcirculatedamongmembers(ArticleV.2),subjecttorulesonconfidentiality(ArticleV.3).

Themembers also set up theAPTERRCouncil (APTERRAgreement, Article VII) with comprehensive powerscodified in the terms of reference annexed to theagreement. Similar to the AFSRB, the APTERR Councilis composed of one representative of each membercountry(ArticleVII.2).Itsdecisionsaremadeonthebasisofconsensusamongallthemembers(ArticleVII.3).

Underthetermsofreference,theAPTERRCouncilhasnoexplicitauthoritytoimposepenaltiesonmemberswho

failtoearmarktheirricecompliantwiththeirobligations.However,paragraph12isacatch-allphraseauthorizingthe APTERR Council to perform “such other functionsas itmaydeemnecessarytoeffectively implementandcarry out the provisions of the agreement” (APTERRAgreement,Attachment3,paragraph12).Hence, thereis basis to argue that theAPTERRCouncilmay imposepenaltiesoncountries if thiswill effectively implementthe agreement. Nevertheless, deciding on whether ithas the power to impose a penalty and whether itwill exercise that power in a specific case are separatedecisions, which must both be decided by consensus(ArticleVIII.2).

ItisnoteworthythattheAPTERRplacesmoreemphasisonnationalinterestaswellasnationallawsandregulationsthan the AFSR. To illustrate, first, APTERR Agreementstates that it will be implemented in accordance withtherespectivenationallaws,regulations,andbudgetaryappropriations of each country (Article II.3). Second,parties may unilaterally suspend in whole or in partthe implementation of the agreement for reasons ofnational interest includingnational security andpublichealth (Article X.8). Finally, parties may unilaterallywithdrawfromtheagreementwithoutspecifiedreasons,provided they comply with the stipulated procedure(ArticleX.9).

Operations of the APTERR SecretariatThe main function of the APTERR Secretariat is tofacilitate the implementation of APTERR programs(APTERRAgreement,ArticleVIII.1).Any implementationof thepolicies,plans,programs,anddecisionsmustbein accordance with the guidelines set by the APTERRCouncil(ArticleVII.4).

The APTERR Secretariat was formed by agreement ofthe APTERR parties (APTERR Agreement, Article VIII);its functions and responsibilities were adopted by theAPTERR Council (Article VIII.1). Currently, its office islocated in Thailand as part of an in-kind contributionfromthegovernment.UnderArticleVIII.2oftheAPTERRAgreement, the location of the APTERR Secretariat isdecidedby consensus of the parties. Its organizationalstructureisprovidedinFigure1.

Table 3: Earmarked Rice Quantity of Each Country

ASEAN Member States

Earmarked Emergency Rice

Reserve (metrictons)

BruneiDarussalam 3,000Cambodia 3,000Indonesia 12,000LaoPeople’sDemocraticRepublic 3,000Malaysia 6,000Myanmar 14,000Philippines 12,000Singapore 5,000Thailand 15,000VietNam 14,000


Earmarked Emergency Rice

Reserve (metrictons)

People’sRepublicofChina 300,000Japan 250,000RepublicofKorea 150,000Total 787,000




Implementation of the EAERR and APTERR

EAERR Pilot Project

Membershavemade significantuseof theEAERRoverthe years. Under Tier 1, in 2010, Viet Nam released10,000metrictonsofricetothePhilippines.Noreleaseshave beenmade under Tier 2 (Trethewie 2013). Tier 3releaseshavebeenthemostdynamic.In7years,atotalof 2,640metric tons of rice were contributed throughTier 3 programs. This has assisted more than 200,000beneficiaries in five countries. The breakdown of theimplementationoftheEAERRpilotproject is illustratedinTable4.

APTERR

Duringitspreparatorystage,therewere20transactionsunderTier3programs.SincetheAPTERRwastransformedintoapermanentscheme,8,260metrictonsofricehavebeen contributed. These transactions are illustrated inTable5.

Resolution of Disputes

Similar to the analysis on the binding nature of theAFSRAgreement,theAPTERRAgreementcreateslegallybindingobligationsfor itsparties,sincethestateshave

Figure 1: Organizational Structure of the APTERR Secretariat

APTERR Secretariat

Food Emergency Operations Division

Implementation Subdivision

FEMI Subdivision

Administrative Subdivision

Finance Subdivision

Administration and Finance Division

APTERR = ASEAN Plus Three Emergency Rice Reserve, FEMI = Food Emergency Monitoring and Information.

Source: APTERR Secretariat.

theintentiontobeboundandstipulatethattheywillactinaparticularway.

Ifanydisputearisesbetweentwoormorepartiesrelatingtothe interpretation,application,or implementationoftheAPTERRAgreement,theymustfollowthemechanismstipulatedinArticleIX.First,theyshouldattempttosettlethedisputethroughinternalconsultationorthroughanyotherpeacefulmeansthattheyagreeupon(ArticleIX.1).Second, if they are unable to reach a settlement, theymayreferthedisputetotheAPTERRCouncil(ArticleIX.2).

Once either the parties or the APTERR Council makesa decision, the APTERR is bereft of provisions on theenforcementofdecisions.ThisisunliketheEDSM,whichhasthecoerciveforceofcompensationandsuspension(EDSMProtocol,ArticleXVI).

However, thisdoesnotnecessarilymeanthatdecisionscannotbeenforced.Thecatch-allprovisioninparagraph12 of the terms of reference is basis to argue thatthe APTERR Council may have enforcement powers, ifenforcement iscrucial for theeffective implementationof the APTERR Agreement (Attachment 3). To date, nostatehasavailedofthedisputeresolutionmechanism.

Discussion and Conclusions

TheAFSRandAPTERRaretheresultofconcertedeffortsto achieve food security in the Asian region. Notably,boththevolumeandutilizationofthericereserveshave


Table 4: Implementation of the Tier 3 Programs during the EAERR Pilot Project, 2004–2010

Year Program Recipient Country Beneficiaries Quantity(MT)2005 Povertyalleviationprogram LaoPeople’s

DemocraticRepublic87householdsandstudentsinVientiane

13

2006 Flashfloodvictimsandrehabilitationprogram

Indonesia 9,992peopleinSampangand22,825peopleintheJemberdistrict

200

2006 Volcaniceruptionandtyphoonvictims Philippines 154,500householdsinfourprovinces

930

2007 Floodvictimsandpovertyalleviationprogram

Cambodia 11,798householdsinfiveprovinces

435

2008 Floodvictims Indonesia 18,182householdsinCentralandEastJava

182

2008–2009 RehabilitationprogramforCycloneNargisvictims

Myanmar 13,120people 320

2010 RehabilitationprogramforTyphoonKetsanavictims

LaoPeople’sDemocraticRepublic

9,207villages 347

2010 Rehabilitationprogramforflashfloodandtyphoonvictims

Philippines 7,137householdsinManilaandIfugaoprovinces

520

EAERR = East Asia Emergency Rice Reserve, MT = megaton.

Source: ASEAN Plus Three Emergency Rice Reserve Secretariat.

Table 5: Implementation of the APTERR Tier 3 Programs Since 2013

Year Program Recipient Country Beneficiaries Quantity(MT)2013 Rehabilitationprogramfor

TyphoonPablovictimsJapan Philippines 230

2013 Droughtandflood Japan LaoPeople’sDemocraticRepublic 4002014 Emergencyresponseto

SuperTyphoonHaiyanPRCThailandMalaysiaJapan

Philippines 8005,000350580

2015 Prepositionofstockpiledricereserve Japan CambodiaPhilippines

210240

2016 Prepositionofstockpiledricereserve Japan PhilippinesLaoPeople’sDemocraticRepublic

225225

2017 RehabilitationprogramforTyphoonKetsanavictims

LaoPeople’sDemocraticRepublic

MyanmarCambodia

500250

2017 Prepositionofstockpiledricereserve Japan Myanmar 500

APTERR = ASEAN Plus Three Emergency Rice Reserve, PRC = People’s Republic of China.

Source: APTERR Secretariat.

grown.Although theagreementshaveprogressed, theAFSRandAPTERRdisputeresolutionmechanismsremainuntested.This is due to the following factors. First, thelimiteduseof the reservemakesdisputes less likely toescalate.Second,themajorityofthereleaseswereunderTier3,wherericeisdispatchedfromstockpiledreservesafter a disaster (Toyoda and Suwunnamek 2011). It isunlikelythatafoodaidrecipientwillsueitsdonor.Third,

ASEANmemberstatesagreedtopreventdisputesfromarisingandtosettlethemthroughfriendlynegotiations(TreatyofAmityandCooperationinSoutheastAsia,1976,Article XIII). They often resort to political, diplomatic,or relations-based means rather than legal methods(Kraichitti2015).Historically,ASEANmemberstateshaveshownpreferenceforothermodesofdisputeresolutionwith a third-party organizationmediating, such as the


WorldTradeOrganizationandtheInternationalCourtofJustice(Kraichitti2015).

Recommendations

Thefollowingpolicyimplicationsaresuggestedtobuildandsustainthemomentumgainedforricereserves:

First, increase cooperation and financial supportfor the APTERR. At present, ASEAN rice demand is500,000 metrictonsperday,whiletheAPTERRphysicalstock of 787,000metric tons is only sufficient to cover1.5 daysofconsumption(Montesclaros2015).

Second, the parties should increase the speed ofnegotiation, coordination, and response for Tier 3releasesafteracalamity.ThePhilippineexperienceaftersuper-typhoonBophashows that timing isessential. Inlate 2013 after Super Typhoon Bopha, the Philippinesmade an emergency request. Members fulfilled therequest,buttimelinesswasamajorconcernasthericetrickledinevenupto18monthsaftertheemergency.

Third, the parties should eliminate the consensusrequirement for APTERR Council decisions in disputes.Consensus has limited the role of ASEAN as a venuefor resolving problems (Phan 2013).To illustrate,whenIndonesia and Malaysia were engaged in the Ligitan/Sipadan territorial dispute, Indonesia attempted tousethe dispute resolutionmechanism under theTreaty ofAmity and Cooperation. Malaysia opposed this, andboth were left with no other option but to refer thedispute to the International Court of Justice (Salleh2007).ThismirrorstheearlierdisputebetweenThailandand Cambodia over the Temple of Preah Vihear. TheUnited Nations Security Council gave ASEAN theauthority to settle the conflict through the ASEANmechanism. However, due to lack of consensus, thecase was referred to the International Court of Justice(Dewi2013).

Finally, the parties should add an enforcement andcompliance mechanism for APTERR Council decisions.Otherwise, itsdecisionswould remainpyrrhicvictories.Asdiscussed,thismaybeexpandedunderparagraph12ofthetermsofreference.


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Asian Development Bank InstituteKasumigaseki Building 8F3-2-5 Kasumigaseki, Chiyoda-kuTokyo 100-6008JapanTel: +813 3593 5500www.adbi.org

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