The ‘law of nations’ that colonial powers invoked to claim the South China Sea islands was based not on international convention or custom but on their own municipal laws on guano concession. It provides that states have the exclusive right to assert title over distant islands where their respective citizens have engaged in economic activities. It was applied selectively to advance colonial and maritime interests and to suppress the claim of China. In their own records, the United States and United Kingdom acknowledged China’s prior and exclusive economic activities on the Spratly Islands and Paracel Islands, and consolidation of title over the Paracel Islands. The records were ignored and subsequently revised, thereby excluding China from availing of the rule. The Japanese peace treaties formalized China’s exclusion by relegating its claim to the same category as the claims that emerged from recent acts of occupation, and subjecting it to resolution by convention.