Firing on and sinking a flagged vessel and possibly killing crew (also, how do you then prove that you DIDN'T kill anyone?) is exactly the kind of thing that gets governments openly involved. Seizing a private vessel and fining the owners? That's a civil matter and while there may be backroom discussions everything stays civil.
"The military of Country X is firing on and sinking our country's vessels" is much more likely to lead to retaliation. China may not have the navy or willingness to project power across the Pacific, but I guarantee they have the capability if focused to utterly destroy the computing infrastructure of the country - and while enthusiastic private parties may not get involved in civil penalties, "Argentina just declared war on us!" is a hell of a rallying cry.
Edit: also keep in mind that even governments are not monolithic entities with a single mind. Those costs are coming out of someone's budget.
Will China bother to defend their fishing boats, though? Are they that entrenched in the governmental structure, or are they basically just petty thugs?
"The military of Country X is firing on and sinking our country's vessels" is much more likely to lead to retaliation. China may not have the navy or willingness to project power across the Pacific, but I guarantee they have the capability if focused to utterly destroy the computing infrastructure of the country - and while enthusiastic private parties may not get involved in civil penalties, "Argentina just declared war on us!" is a hell of a rallying cry.
Edit: also keep in mind that even governments are not monolithic entities with a single mind. Those costs are coming out of someone's budget.