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This Law claims that the exclusive economic zone of the People's Republic of China covers the area beyond and adjacent to the territorial sea extending to 200 nautical miles from the baselines and its continental shelf comprises the sea-bed and subsoil of the submarine areas that extend to a distance of 200 nautical miles from the baselines.

The People's Republic of China also laims its sovereign rights over the exclusive economic and the continental shelf for the purpose of exploring it and exploiting its natural resources of the zone such as production of energy from water, currents and winds at the same time it may formulate relevant regulations on the basis of this Law.

Out of its economic and security motives, Malaysia entered the Spratly Islands dispute, making it more complex. Malaysia is reluctant in "Joint development" of the Spratly Islands area but is actively exploiting the resources itself and trying to enhance its claim over the area through military occupation and development.

"In accordance with the Law of the People's Republic of China on the TerritorialSea and the Contiguous Zone adopted and promulgated on 25 February 1992, the Government of the People's Republic of China hereby announces the baselines of part of its territorial sea adjacent to the mainland and those of the territorial sea adjacent to its Xisha Islands as follows:.."

 

China's Response to the Republic of Philippines' Note Verbale No. 000228 dated 5 April 2011.

The Note says that China has indisputable sovereignty over the islands in the South China Sea and the adjacent waters. The Submission by the Socialist Republic of Viet Nam dated 7 May 2009 to the Commission on the Limits of the Continental Shelf has seriously infringed China's sovereign rights and jurisdiction in the South China Sea. Chinese Government seriously requests Secretary-General of the United Nations and the Commission not to consider the Submission by the Socialist Republic of Viet Nam.

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