The Permanent Court of Arbitration (PCA) at The Hague handed down a ruling in July that China lacked a legal basis for its claim to "historic rights" across the "nine-dash line" territorial demarcation in the South China Sea. Particularly damaging to China was the international tribunal's outright rejection of its claim to historic rights in the region.
Control of the South China Sea first became a contentious issue in the 1930s. Based on reports that Japan would take over the islands of the South China Sea, in 1933 French forces occupied Taiping (also known as Itu Aba) Island in the Spratly chain, forcing the evacuation of all Japanese nationals. Two years later, France transferred 30 Vietnamese to the island. At the time, Vietnam was still under French colonial rule and known as French Indochina.
The French government announced that these tactics signified its official occupation of the islands, and the Kuomintang-led government of China raised no objection: At the time, China viewed the Paracel Islands as its own territory, but not the Spratlys.