A tribunal has ruled that China has no legal basis for its vast territorial claims in the South China Sea.

In a case brought by the Philippines, an international panel sitting in The Hague also found that China had aggravated the regional dispute with its extensive construction of artificial islands, which destroyed coral reefs and infringed upon the Philippines' exclusive economic zone.

China immediately rejected the arbitration findings, and their impact remains unclear as there is no policing agency or mechanism to enforce them.

While the ruling cannot reverse China's actions, it still constitutes a rebuke, carrying with it the force of the international community's opinion.

It also gives heart to small countries in Asia in the face of Chinese expansionism, backed by its military and economic power.

Philippine foreign secretary Perfecto Yasay said: "The Philippines strongly affirms its respect for this milestone decision as an important contribution to ongoing efforts in addressing disputes in the South China Sea."

He also called on "all those concerned to exercise restraint and sobriety".

Former foreign secretary Albert del Rosario, who helped oversee the filing of the case, said the ruling underlined "our collective belief that right is might and that international law is the great equaliser among states".

China and the Philippines are among six governments with overlapping territorial claims in the South China Sea, waters through which an estimated five trillion US dollars (£3.85 trillion) in global trade passes each year. The territory is rich in fishing stocks and holds a potential wealth of oil, gas and other resources.

The disputes have also increased friction between China and the US, which has ramped up its military presence in the region as China has expanded its navy's reach.

The Philippines, under a UN treaty governing the seas, had asked in 2013 for arbitration on a number of issues it had with China.

The five-member panel from the Permanent Court of Arbitration in The Hague unanimously concluded that China had violated its obligations to refrain from aggravating the dispute while the settlement process was ongoing.

It also found that China had interfered with Philippine petroleum exploration at Reed Bank, tried to stop fishing by Philippine vessels within the country's exclusive economic zone and failed to prevent Chinese fishermen from fishing within the Philippines' exclusive economic zone at Mischief Reef and Second Thomas Shoal.

China, which boycotted the entire proceedings, reiterated that it does not accept the panel's jurisdiction. China's foreign ministry said it "solemnly declares that the award is null and void and has no binding force. China neither accepts nor recognises it".

It added: "China's territorial sovereignty and maritime rights and interests in the South China Sea shall under no circumstances be affected by those awards."

The ministry repeated China's often-expressed view that the Philippines' move to initiate arbitration without China's consent was in "bad faith" and in violation of international law.

A professor of Asian political economy said the ruling could be a "transformative moment" in the region.

Speaking outside the Peace Palace in The Hague, Leiden University professor Jonathan London said the decision will "give countries with a common interest in international norms something to point to and to rally around".

Japanese foreign minister Fumio Kishida said the tribunal's decision is "final and legally binding" and that the two sides should comply with it.

He said Japan "strongly expects that the parties' compliance with this award will eventually lead to the peaceful settlement of disputes in the South China Sea".

China considers bilateral talks with the other claimants to be the only way to address the South China Sea disputes.

It has said vast areas of the South China Sea have been Chinese territory since ancient times. It bases its modern claims on the so-called nine-dash line, a map demarcating its claims which was submitted under the UN treaty in 1984.

Manila brought the case because China's claims infringe upon its own 200-mile exclusive economic zone.

The ruling sparked scenes of joy in the Philippines. The country's new president, Rodrigo Duterte, said last week his government stood ready to talk to China if it receives a favourable ruling.

It remains to be seen, however, how far Mr Duterte can stray from Manila's previously critical stance, given his country's growing nationalist sentiment against Chinese actions.