Thanks for the question! So we’re asked here for the reason that nations failed to establish rules protecting their territorial waters before the middle of the twentieth century. Well, where in the passage is this discussed? Take a look at lines 13-15, where we’re told that “because this area of territorial dominion was so limited, most nations did not establish rules for management or protection of their territorial waters.” Well, we’re basically straight up told there that it’s because of the size, which (B) doesn’t talk about and (C) does, which should make us think it’s (C). And remember, the key here is the fact that we’re talking about a nation’s territorial waters, not international waters. So (B) might be true when it comes to international waters, but can’t also be applied to territorial waters. And that’s what makes it wrong.
Hope this helps! Feel free to ask any other questions that you might have.