Abstract: Arbitration under Annex VII of the United Nations Convention on the Law of the Sea (UNCLOS) would be the most effective resolution method and would lead to the most favorable outcome for the Philippines against China in the South China Sea (SCS) Dispute. The Philippines will likely not pursue adjudication in the International Court of Justice (ICJ) because the court would likely grant sovereignty over any islands to China, thus legitimizing China’s aggressive actions in the SCS. Furthermore, continued negotiations are also not a viable option for the Philippines because any agreement would be inadequate to deter China from future actions in the SCS. Under the Annex VII approach, a holding by an arbitral tribunal in the Philippines’ favor would enable the states of the Association of Southeast Asian Nations (ASEAN) to present a united front to China that the only acceptable basis for maritime claims in the SCS must be under UNCLOS and would ensure access to the abundance of natural resources in the SCS that are central to the Southeast Asian economies. Overall, not only will arbitration lead to the most efficient and favorable outcome for the Philippines, it will also lay the groundwork for future stability among all claimant states in the SCS.