The Timor Sea Conciliation: Lessons for the Future of Ocean Governance

By: Dionísio Babo Soares*

On 16 November 1994, the entry into force of the United Nations Convention on the Law of the Sea (UNCLOS) established a comprehensive legal framework for the governance of the oceans. Beyond codifying the rights and obligations of States, the Convention instituted an innovative system for the peaceful settlement of disputes, under Part XV, harmonising compulsory jurisdictional procedures with alternative mechanisms that reconcile the preservation of cooperation with respect for State sovereignty. More than three decades later, this architecture has demonstrated remarkable resilience. However, one of its least-explored mechanisms — compulsory conciliation — has emerged as a paramount instrument for resolving disputes that transcend the scope of traditional adjudication. The present text proposes extracting lessons from this unprecedented Timorese initiative.

The conciliation process between Timor-Leste and Australia, conducted between 2016 and 2018 under the auspices of the Permanent Court of Arbitration (PCA), which performed the functions of Secretariat for the proceedings, marked the first time in history that the compulsory conciliation mechanism provided for in Annex V, Section 2, of UNCLOS was triggered and successfully concluded—triggered following the declaration deposited by Australia on 22 March 2002, under article 298, paragraph 1, subparagraph (a), item (i), whereby it excluded from the binding procedures of Section 2 of Part XV disputes concerning the interpretation and application of articles 15, 74 and 83 on maritime delimitation, the procedure tested the effectiveness of a non-binding mechanism in overcoming a prolonged political and legal impasse. The consensus reached culminated in the conclusion of the Treaty establishing the Maritime Boundaries in the Timor Sea, signed at United Nations Headquarters in New York on 6 March 2018 and in force since 30 August 2019, which defined a permanent maritime boundary and a cooperation regime for the development of the Greater Sunrise hydrocarbon resources. The success of this process demonstrated that conciliation is not merely a subsidiary recourse to litigation; rather, it is an autonomous mechanism capable of reconciling principles of international law with political imperatives.

Part XV of UNCLOS reflects a carefully negotiated compromise between the binding nature of dispute settlement mechanisms and the foundational principle of State consent. While articles 286 to 296 provide for binding judicial and arbitral procedures, articles 297 to 299 recognise that certain disputes — particularly those concerning the delimitation of maritime boundaries and military activities — entail particular political sensitivity. For these eventualities, Annex V enshrines compulsory conciliation: States may be called upon to participate in a procedure triggered unilaterally, while preserving, however, the sovereign prerogative to accept or reject the conciliation commission’s recommendations. This legal formulation aims to mitigate the indefinite perpetuation of disputes, safeguarding State autonomy in sensitive matters.

The Timor Sea dispute illustrates, in paradigmatic fashion, the circumstances envisaged in article 298. Following the restoration of Timor-Leste’s independence in 2002, the delimitation of maritime boundaries with Australia remained suspended, notwithstanding the conclusion of several interim agreements on petroleum resources, namely the Timor Sea Treaty (2002) and the Treaty on Certain Maritime Arrangements in the Timor Sea (CMATS) (2006). The perception of a breach of bilateral trust during the CMATS negotiations aggravated relations, culminating in an arbitration instituted in 2013 under the Timor Sea Treaty to contest the validity of CMATS and in proceedings brought on 17 December 2013 before the International Court of Justice regarding the seizure of documents and data at the premises of Timor-Leste’s legal adviser in Canberra, a case removed from the Court’s list on 11 June 2015 following the return of the material by Australia. It was in this intricate diplomatic context that Timor-Leste invoked the compulsory conciliation mechanism under Annex V on 11 April 2016, thereby initiating a process that would transform a conflict into a negotiated and equitable solution.

The triumph of the Conciliation Commission rested not exclusively on the soundness of its legal recommendations, but also on the innovation of its working methodology. The initiative to invoke this statutory mechanism under UNCLOS fell to His Excellency Kay Rala Xanana Gusmão, appointed in the same year, 2016, as Chief Negotiator of the Council for the Definitive Delimitation of Maritime Boundaries. Constituted on 25 June 2016 and presided over by Ambassador Peter Taksøe-Jensen, the Commission comprised Judges Abdul G. Koroma and Rüdiger Wolfrum, appointed by Timor-Leste, and Dr Rosalie Balkin and Professor Donald McRae, appointed by Australia; by unanimous decision of 19 September 2016, it rejected Australia’s objections to its competence and proceeded with the proceedings. By distancing itself from the traditional posture of a judicial body, the Commission fostered an environment conducive to sustained negotiations. The transparency of the process reinforced its internal legitimacy, while confidential diplomatic endeavours enabled frank dialogue on politically complex matters. The high degree of technical specialisation allowed for the simultaneous articulation of maritime delimitation, shared management of natural resources, petroleum development, and broader geopolitical considerations.

It should be emphasised that the Commission actively promoted direct negotiations between the Parties, thereby catalysing the historic comprehensive agreement of 30 August 2017, prior to the submission of the final report, which was deposited with the Secretary-General of the United Nations on 9 May 2018. In this sense, conciliation served less as an alternative to diplomacy than as the institutional framework that enabled diplomacy itself to bear fruit.

The 2018 Treaty attests to the broad potential of compulsory conciliation. This legal instrument established a maritime boundary consistent with contemporary international law — although the eastern and western lateral segments remain susceptible to adjustment, whether in light of a future delimitation agreement between Timor-Leste and Indonesia, or following the commercial depletion of resources in the area —, formalised the termination of the regime instituted by CMATS, which Timor-Leste denounced in January 2017 in the course of the proceedings itself, taking effect on 10 April of that year, and instituted a Special Regime to govern the exploitation of the Greater Sunrise gas fields. It did so through concerted institutional mechanisms and an upstream revenue-sharing model that assigns Timor-Leste the larger share: seventy per cent if the gas is processed in Timorese territory and eighty per cent if it is processed in Australian territory. Avoiding the dichotomy of “winners and losers”, the process generated a framework of stability that combines legal certainty with continuous bilateral cooperation. The effectiveness of the Commission’s recommendations derived, therefore, not from their coercive force, but from their vocation to facilitate mutually acceptable political understandings anchored in international law.

The relevance of the Timor Sea experience transcends mere boundary delimitation. The adoption, on 19 June 2023, of the Agreement on the Conservation and Sustainable Use of Marine Biological Diversity of Areas Beyond National Jurisdiction (BBNJ Agreement) — which entered into force on 17 January 2026, one hundred and twenty days after the deposit of the sixtieth ratification, which occurred on 19 September 2025 — inaugurates a new paradigm in ocean governance. This treaty focuses on the conservation of biodiversity, marine genetic resources, environmental impact assessments, and area-based management tools. Although its article 60 refers dispute resolution to the mechanisms of Part XV of UNCLOS, the Agreement also introduces innovations designed to prevent the escalation of disputes: article 56 enshrines an autonomous duty of cooperation for the prevention of disputes, article 59 affords Parties the possibility of consensually submitting technical questions to an ad hoc panel of experts, and article 55 institutes a facilitative, non-adversarial and non-punitive Implementation and Compliance Committee.

The Timorese-Australian experience does not, however, constitute an isolated case of historical relevance alone. The principles that underpinned its success illuminate pathways to address the current challenges of global ocean governance, notably those emerging from the BBNJ Agreement.

These dynamics reflect a structural metamorphosis in international dispute resolution. Today, the challenges in ocean governance relate less to the simple ownership of rights and more to highly complex scientific and technical issues, overlapping institutional competencies, and evolving environmental obligations. In this framework, adversarial judicial procedures may prove insufficient to ensure lasting collaboration. The Timor Sea Conciliation demonstrates that flexible procedures, grounded in technical rigour and sensitive to political context, can accommodate scientific uncertainty without burdening long-term cooperative relations. The emphasis that the BBNJ Agreement places on technical cooperation and conflict prevention thus mirrors the principles successfully applied in the Timorese-Australian process.

The Agreement also recognises the increasingly fragmented nature of international ocean governance. Marine biodiversity is today protected by a complex network of regional fisheries management organisations, environmental conventions, and sectoral entities. Rather than replacing these regimes, the BBNJ Agreement provides that its interpretation and application shall not prejudice relevant existing legal instruments and frameworks, aiming instead to complement them through articulated implementation and the coordination of dispute settlement mechanisms. This institutional pluralism underscores the utility of conciliation, a mechanism particularly suited to disputes that require coordination among multiple legal regimes and institutional architectures.

The principal lesson to be drawn from the Timor Sea is, in sum, of a conceptual rather than merely procedural nature. The process refutes the postulate that effectiveness in dispute resolution depends, inexorably, on impositional judicial decisions. On the contrary, it proves that legitimacy may emanate from procedural transparency, technical impartiality, and sustained diplomatic engagement. International law is not exhausted by the attribution of rights and duties; it also provides, in equal measure, the institutional infrastructure necessary for States to reconcile divergent interests, preserving bridges for future cooperation. This realisation assumes capital importance in a conjuncture in which the international community faces the multidimensional challenges of climate change, biodiversity erosion, deep-seabed mining, and the equitable sharing of genetic resources.

More than three decades after the entry into force of UNCLOS, its greatest legacy resides not only in the consolidation of a global legal order for the oceans, but also in the provision of a diverse array of instruments for the pacification of disputes. The Timor Sea Conciliation constitutes an unforgettable milestone in that trajectory, evidencing how compulsory conciliation can operate as a bridge between the structuring principles of law and political pragmatism. With the entry into force of the BBNJ Agreement, this precedent provides invaluable guidance for the shaping of dispute settlement mechanisms capable of responding to the imperatives of contemporary governance. The future of the law of the sea will depend, therefore, not only on the expansion of compulsory jurisdiction, but, above all, on the strengthening of institutions that can harmonise legal authority, scientific rigour, and diplomatic intelligence in the service of peaceful, equitable, and lasting solutions.

• The present article expresses, exclusively, the personal perspective of the author, and is intended for academic and informational purposes. The positions expounded therein do not bind the State or the entities and institutions with which the author is associated.