European Union President Donald Tusk on Tuesday cautioned China to respect the international system, as the world's second-largest economy finds itself locked in disagreements over maritime law and global trade practices.

His comments preceded a judgement from a UN-backed tribunal declaring that China had no "historic rights" in the strategically vital South China Sea, a ruling swiftly rejected by China's foreign ministry.

Speaking in Beijing at the start of the EU-China summit, Tusk called on the Asian giant to protect the "rule-based international order", saying the task "may be the biggest challenge ahead of us."

EU members have roundly criticised Beijing for its trade practices, claiming the Asian giant is flooding global markets with cheap products, driving down prices and threatening economic stability.

The global framework of laws and regulations "brings so many benefits to our nations," Tusk said, adding: "If many start believing that globalisation and international trade are happening without or against common rules, then the first victims will be Chinese and European economies, not to mention people."

His comments followed remarks by Chinese Premier Li Keqiang that the meeting is "an active signal that clearly states that we are two important powers safeguarding world peace and development."

Earlier in the day, China cancelled a pre-arranged press conference with the leaders, EU representatives said.

The EU is in the process of considering whether or not to grant China market economy status, a designation that would make it much harder for major economies to fight Beijing over alleged unfair trading practices.

Opposition to granting the status has focused on complaints that China has violated global trade rules, most notably selling steel at below market prices.

Tusk also referred to the South China Sea dispute between Beijing and Manila ahead of the decision from the Hague-based tribunal, saying "the rule-based international order is in our common interest, and both China and the EU have to protect it, as this is in our people's best interests."

China asserts sovereignty over almost all of the strategically vital waters in the face of rival claims from its Southeast Asian neighbours.

To bolster its position it has rapidly turned reefs into artificial islands capable of hosting military planes.

Manila lodged its suit against Beijing in 2013, challenging China's claims to much of the waterway and saying it was in violation of the UN Convention on the Law of the Sea (UNCLOS), to which both countries are signatories.

Beijing insists the tribunal has no jurisdiction over the issue and that it will ignore the ruling.

South China Sea tribunal: key findings
The Hague (AFP) July 12, 2016 - A United Nations-backed tribunal on Tuesday issued a damning ruling against China on its long-running dispute with the Philippines in the South China Sea.

Here are some of the key findings in the lengthy document.

China's 'nine-dash-line' is invalid

-- The five member panel found that Chinese fishermen, amongst others, had historically made use of the islands in the South China Sea but "there was no evidence that China had historically exercised exclusive control over the waters or their resources.

"The Tribunal concluded that there was no legal basis for China to claim historic rights to resources within the sea areas falling within the 'nine-dash-line'".

Reclaimed islands have no exclusive economic zone

-- The artificial islands that China has been furiously building over recent years are not capable of sustaining a population and therefore under international treaties do not have the 200 nautical mile "exclusive economic zone" (EEZ) enjoyed by inhabited land.

"The Tribunal noted that the current presence of official personnel on many of the features is dependent on outside support and not reflective of the capacity of the features... (and) ....that none of the Spratly Islands is capable of generating extended maritime zones.

"The Tribunal found that it could -- without delimiting a boundary -- declare that certain sea areas are within the exclusive economic zone of the Philippines, because those areas are not overlapped by any possible entitlement of China."

China has behaved unlawfully

Because areas at issue are within the Philippines EEZ, Chinese construction of artificial islands and its interference with Philippine fishing and mineral activities is illegal.

"China had violated the Philippines' sovereign rights in its exclusive economic zone. The Tribunal further held that Chinese law-enforcement vessels had unlawfully created a serious risk of collision when they physically obstructed Philippine vessels."

Beijing has damaged the environment

China's large-scale land reclamation has "caused severe harm to the coral reef environment and violated its obligation to preserve and protect fragile ecosystems".

China was also remiss in failing to put a stop to the harmful "harvesting of endangered sea turtles, coral and giant clams on a substantial scale" by its fishermen.

Island building should have stopped during the dispute process

The panel said it had no jurisdiction over the military standoff at Second Thomas Shoal, where Chinese and Philippine military and law enforcement vessels are locked in confrontation.

However, "China's recent large-scale reclamation and construction of artificial islands was incompatible with the obligations on a state during dispute resolution proceedings, insofar as China has... destroyed evidence of the natural condition of features of the South China Sea that formed part of the Parties' dispute."

South China Sea tribunal: key findings
The Hague (AFP) July 12, 2016 - A United Nations-backed tribunal on Tuesday issued a damning ruling against China on its long-running dispute with the Philippines in the South China Sea.

Here are some of the key findings in the lengthy document.

China's 'nine-dash-line' is invalid

-- The five member panel found that Chinese fishermen, amongst others, had historically made use of the islands in the South China Sea but "there was no evidence that China had historically exercised exclusive control over the waters or their resources.

"The Tribunal concluded that there was no legal basis for China to claim historic rights to resources within the sea areas falling within the 'nine-dash-line'".

Reclaimed islands have no exclusive economic zone

-- The artificial islands that China has been furiously building over recent years are not capable of sustaining a population and therefore under international treaties do not have the 200 nautical mile "exclusive economic zone" (EEZ) enjoyed by inhabited land.

"The Tribunal noted that the current presence of official personnel on many of the features is dependent on outside support and not reflective of the capacity of the features... (and) ....that none of the Spratly Islands is capable of generating extended maritime zones.

"The Tribunal found that it could -- without delimiting a boundary -- declare that certain sea areas are within the exclusive economic zone of the Philippines, because those areas are not overlapped by any possible entitlement of China."

China has behaved unlawfully

Because areas at issue are within the Philippines EEZ, Chinese construction of artificial islands and its interference with Philippine fishing and mineral activities is illegal.

"China had violated the Philippines' sovereign rights in its exclusive economic zone. The Tribunal further held that Chinese law-enforcement vessels had unlawfully created a serious risk of collision when they physically obstructed Philippine vessels."

Beijing has damaged the environment

China's large-scale land reclamation has "caused severe harm to the coral reef environment and violated its obligation to preserve and protect fragile ecosystems".

China was also remiss in failing to put a stop to the harmful "harvesting of endangered sea turtles, coral and giant clams on a substantial scale" by its fishermen.

Island building should have stopped during the dispute process

The panel said it had no jurisdiction over the military standoff at Second Thomas Shoal, where Chinese and Philippine military and law enforcement vessels are locked in confrontation.

However, "China's recent large-scale reclamation and construction of artificial islands was incompatible with the obligations on a state during dispute resolution proceedings, insofar as China has... destroyed evidence of the natural condition of features of the South China Sea that formed part of the Parties' dispute."