Disputes are fractal. Any summary will be incomplete to some observer.
The United Nations Convention on the Law of the Sea, to which China is a party (but the United States is not) [1], ruled with the Philippines on the South China Sea's territoriality being drawn by UNCLOS rules. Others in the region disputing China's claims take similar positions [2]. The UUV was seized closer to the Philippine shore than to mainland China.
[1] https://en.wikipedia.org/wiki/United_Nations_Convention_on_t...
[2] http://timesofindia.indiatimes.com/india/India-and-Indonesia...