A high-profile legal team from Manila will begin arguing on Tuesday that the five-judge Permanent Court of Arbitration in The Hague has jurisdiction over a case the Philippines filed in March last year, contesting China's claims to nearly all of the South China Sea.

China is not taking part in the arbitration proceedings, and has said it will not recognise any ruling favouring the Philippines.

Here are some facts on the case:

What is the case all about?

China is claiming 90 per cent of the 3.5 million sq km South China Sea. The Philippines sued China in March last year to challenge that claim.

China maintains that its "sovereign" claims - backed by historical records and maps that show ancient Chinese presence throughout the South China Sea - is "indisputable".

In 1953, it marked the boundaries of these claims with a "nine-dash line" drawn by cartographers of the Kuomintang regime in 1949 that protrudes from China's southern Hainan island and loops towards Indonesia.

The Philippines contends that under the United Nations Convention on the Law of the Sea (Unclos), that line is invalid, as it stretches as far as 1,611km from the nearest Chinese land mass.

Why does it matter?

The 3.5 million sq km South China Sea is critical to the world's economy.

Some US$5 trillion (S$6.6 trillion) in ship-borne goods pass there each year, connecting Asia's fast-growing economies with markets in Europe, the Middle East and Africa.

The ground beneath it is believed to hold vast reserves of oil and natural gas.

The United States and Japan are worried that China may be attempting to control the South China Sea's vital waterways and airspace with a chain of nearly completed man-made islands in the Spratly archipelago.

Tensions flared recently after the US flew a surveillance plane over one of these islands and suggested that it is considering sending warships and fighter jets to directly challenge China's claims.

Even Asean has expressed its concerns, as it presses China to accept a binding "code of conduct" that will serve as a mechanism to settle by diplomacy territorial disputes in the South China Sea.

What is at stake at this week's hearings?

Manila's oral arguments this week, which will start on Tuesday and end on Saturday, will focus on whether the Permanent Court of Arbitration has jurisdiction over the Philippines' case against China.

The court asked for this proceeding after China, although not participating in the arbitration hearings, released a "position paper" in December last year.

In that paper, China maintains that the "essence" of the Philippines' case is territorial entitlements of land features - in other words, sovereignty - which is outside the arbitration court's scope.

China insists sovereignty can only be discussed if it agrees to participate, since it has already submitted a declaration, which the United Nations has accepted, that exempts it from compulsory, unilateral arbitration on matters concerning sovereignty.

The Philippines says its case is not about sovereignty, but is essentially a legal move to have a UN court declare China's nine-dash line as inconsistent with Unclos.

It insists that Unclos' system of territory and economic zones - which specify what can be claimed from features such as shoals, islets, reefs and other rocky outcrops - allows for arbitration, even when one side objects and refuses to participate, it argues.

A decision on the issue of jurisdiction is not due till six to 12 months from now.

What if the Philippines loses the argument?

The Philippines concedes that its case will end abruptly if the Permanent Court of Arbitration takes China's side and agrees it has no jurisdiction. China will then gain legal ground to fortify its holdings in the South China Sea.

This is why the world is viewing the case with keen interest.

What if the Philippines wins?

If the Permanent Court of Arbitration decides in its favour, the Philippines can then proceed to argue the merits of its case.

Essentially, the Philippines wants China to abide by Unclos and recognise its 200 nautical mile exclusive economic zone.

The two nations are contesting at least 11 islets, reefs, shoals and atolls inside this zone. China is already occupying Mischief reef and has blockaded Scarborough Shoal.

But even if the Philippines eventually wins, the victory will only be symbolic, as China has already declared that it will not accept a ruling in Manila's favour.

Supreme Court Associate Justice Antonio Carpio, who has helped define the Philippines' territorial boundaries, said while Beijing cannot be compelled to comply, a favourable ruling will allow Manila to shame China before the court of world opinion.

He said the Philippines, for instance, can sponsor a resolution every year before the UN General Assembly declaring China as usurper of territories.