Ships South China Sea-min

Autor foto: US Department of Defense

The Code of Conduct – a way to move forward with the South China Sea dispute?

The Code of Conduct – a way to move forward with the South China Sea dispute?

4 lipca, 2023

The Code of Conduct – a way to move forward with the South China Sea dispute?

Ships South China Sea-min

Autor foto: US Department of Defense

The Code of Conduct – a way to move forward with the South China Sea dispute?

Autor: Mateusz Chatys

Opublikowano: 4 lipca, 2023

                                                                                                      Pulaski Policy Paper no 31, July 04, 2023

Background of the South China Sea Disputes

The strategic significance of the South China Sea is primarily attributed to its geographical location, rendering it one of the world’s busiest and most strategically important shipping routes. The Strait of Malacca, the Sunda Strait, and the Lombok Strait, situated within the islands and waters of the South China Sea, facilitate the transit of over 50% of global trade, amounting to approximately $5 trillion. Moreover, these waterways serve as crucial energy routes for East Asian nations, enabling the transportation of oil and natural gas from the Persian Gulf. Consequently, the South China Sea holds considerable geopolitical and geostrategic importance for China, East Asian countries, and the United States, as the latter’s trade, valued at $1.2 trillion, relies on these waters. Furthermore, the region possesses proven oil and gas reserves, underscoring that the disputed islands’ sovereignty entails legal rights to exploit these resources. From a strategic standpoint, the geographical significance lies in the fact that whoever attains dominance over the South China Sea wields influence over the future trajectory of the Indo-Pacific region.

The complexities surrounding the situation in the South China Sea are multifaceted, encompassing territorial disputes (over islands, rocks, reefs), maritime disputes (including resources from the waters and the seabed), as well as legal disputes regarding rights for economic or military purposes. This dispute involves six countries: China, Taiwan, Vietnam, the Philippines, Malaysia, and Brunei. Indonesia, to some extent, may also be included in this group, given its overlapping maritime claims with China in the vicinity of the Natuna Islands. Nevertheless, the Indonesian government has refrained from considering itself an official party to the dispute, as doing so may lend legitimacy to Chinese claims expressed through the so-called „nine-dash line”.

Considering the very general nature of the nine-dash line, it should be stated that China (together with Taiwan, whose claims coincide with the eleven-dash line drawn up in 1947) is the leading actor in the dispute. Beijing’s claims cover, depending on the estimates, 60-90% of South China Sea waters including all islands, reefs and rocks in the area (Spratly Islands, Paracele Islands, Pratas, Macclesfield Bank, Scarborough Shoal). Among the Southeast Asian countries, Vietnam claims all features in the Paracel and Spratly Islands, while the Philippines lays claim to part of the Spratly archipelago (known as Kalayaan Islands), along with Macclesfield Bank and Scarborough Shoal. Additionally, Malaysia asserts control over several reefs and rocks, while Brunei seeks to claim a single reef. It is worth noting that while China’s claims are based on the concept of „historical rights”, a notion that was rejected by the 2016 Permanent Court of Arbitration (PCA) ruling under the United Nations Convention on the Laws of the Sea (UNCLOS), the claims of the ASEAN member states are firmly based on UNCLOS principles.

The beginnings of the Code of Conduct

From March 8 to 10, the Association of Southeast Asian Nations (ASEAN) and China resumed negotiations in Jakarta on the Code of Conduct (CoC) in the South China Sea following a three-year coronavirus pandemic-induced hiatus. The main force behind pushing forward the negotiations was Indonesia, currently holding the rotating chairmanship of the ASEAN. Although Indonesia is not officially a party to the disputes in the South China Sea, its government has a vested interest in developing a code that will serve to de-escalate tensions in the region.  This interest primarily arises from the overlapping maritime claims between Indonesia and China in the North Natuna Sea, which is located in the southern portion of the South China Sea.

The first call for „a regional code of conduct in the South China Sea” to set guidelines to minimise the likelihood of a potential conflict came from ASEAN foreign ministers in 1996. Major disagreements on several issues allowed only for the signing of the nonbinding Declaration on the Conduct of Parties in the South China Sea (DoC) in 2002. The terms of the declaration were brief and somewhat broad. The signatories committed to resolving their differences peacefully and avoiding any activities that might exacerbate disputes or threaten peace and stability. However, the declaration did not specify that the future CoC would attempt to resolve the disagreements in the South China Sea, nor did it require its parties to abide by its provisions. The main difference between the DoC and the proposed CoC was that the latter would be more comprehensive and effective than the former, which in fact, was just a vague political statement.

After fifteen years, another limited in its nature document was developed: the Framework of the CoC in August 2017[i], followed by the Single Draft South China Sea Code of Conduct Negotiating Text (SDNT)[ii] in June 2018. Although the framework represents a degree of progress, it lacks specificity and largely restates the contents of the 2002 DoC, with a few minor additions. The document includes updated references to incident prevention and management, along with more detailed commitments to maritime security and freedom of navigation as well as overflight above the South China Sea. However, it does not contain any provision concerning the legally binding nature of the CoC, a key concern for Southeast Asian nations. Another shortcoming of the framework is that it does not specify the geographical scope of the CoC, namely whether it will apply to the Spratly and Paracel Islands or only to specific parts of disputed areas in the South China Sea. Moreover, there are no details related to the enforcement measures and arbitration mechanisms, which is the reason why the effectiveness of the final COC is rather questionable.[iii] The structure of the SDNT is comparable to the previous document, although, except for parts taken from the framework, it is supplemented by consolidated text and suggestions presented by individual parties to the negotiations (ASEAN member states and China). However, it still suffers from the divergence between negotiating parties, such as the aforementioned geographical and legal scope of the CoC.

The indication by the Chinese Prime Minister Li Keqiang in 2018 of the timeframes for the conclusion of negotiations on the CoC by 2021 aroused moderate optimism regarding moving things forward.[iv] However, it turned out to be some other clever trick of China to buy itself more time. It became apparent that Beijing had no intention to conclude the CoC unless it was watered down to a meaningless shape. In the meantime, China could consolidate its clout in the region and appear to be an actor open to negotiation with other claimants.

Given the history of progress on the CoC, it should come as no surprise that the recent round of negotiations did not bring any significant breakthroughs. The primary outcome of the talks, of somewhat symbolic significance, was a decision to conduct an exercise on a security hotline at some point this year. It is worth noting that this measure was agreed upon in 2016 in order to mitigate the risk of escalating the tensions due to maritime incidents and standoffs but has never been implemented.[v] This is one more proof of the sluggish and inefficient process of negotiations on the CoC, especially considering the fact that Japan, as the first non-member state, launched a security hotline with ASEAN ahead of China.[vi] Moreover, it demonstrates Beijing’s preference towards a bilateral approach to issues related to the South China Sea disputes because it established separate hotlines with Vietnam in June 2021[vii] and the Philippines in January 2023.[viii] Thus, China utilizes the asymmetric nature of bilateral relations with weaker Southeast Asian states to its favour.

Main obstacles towards the Code of Conduct

Practically from the beginning of the talks on the document, a number of problematic issues came to the fore, which are the main cause of the stalemate. These include the code’s geographic scope, legal status, dispute settlement mechanisms as well as the possibility of involvement by third parties. According to some analysts, the very process of negotiating the code is important because it provides a platform for talks between the parties to the dispute, which serves as an important mechanism for de-escalating tensions in the region. According to Mark Valencia, the only way to normalize the situation in the South China Sea is to seek a compromise on the CoC at all costs. He argues that a loose form of the code will facilitate preserving ASEAN’s centrality in the international system and, simultaneously, prevent China from enforcing the tenet “might makes right”.[ix] However, as Collin Koh aptly points out, such a form of CoC would be just as dysfunctional as the 2002 DoC. Therefore, it would have minimal impact on changing the status quo in the region.[x] Needless to say, China’s edge vis a vis other claimants puts it in a position where it is unlikely to make far-reaching concessions on the South China Sea, and ASEAN lacks the leverage needed to compel a compromise. Another reason behind hindering the negotiation process is the involvement of all ASEAN member countries – the vast majority of them are not parties to the South China Sea dispute – and the consensus-based decision-making process. At this point, it is far too late to abandon the process of negotiations. Nevertheless, it’s high time to accept this solution’s limitations. For that reason, only claimant states should engage in parallel negotiation on specific issues, such as oil and gas exploration, law enforcement cooperation, and fisheries management.

Chinese expansion in the South China Sea

Given the fact that Chinese interests in the South China Sea are, in most cases, at odds with those of ASEAN counter-claimants, prolonging negotiations on the CoC works to Beijing’s advantage. Beijing has consistently pursued a strategy of territorial expansion and occupation and has avoided or delayed any attempts to resolve disputes dating back to the 1950s. During this time, China used force to seize complete control of the Paracel Islands in 1974 and six features of the Spratly Islands in 1988, as well as takeover Mischief Reef in 1994 and Scarborough Shoal in 2012. In the 2000s, China began to leverage its increasing economic, diplomatic, and military power to consolidate its influence in the South China Sea through various forms of deterrence and coercive actions. This expansionist policy became especially visible after Xi Jinping’s ascent to power, which included, among other things the unification of maritime law enforcement agencies. One key solution was the construction of artificial islands (both in the Paracele and Spratly archipelagos), which were then transformed into military outposts and equipped with modern military equipment to monitor any activity in the South China Sea. This provided Beijing with a significant strategic advantage over other claimant states. Although the 2016 PCA ruling prompted Beijing to become more involved in negotiations for the CoC, Beijing continues its activities below the threshold of military operations in the „grey zone”, employing maritime militia and coast guard to harass and intimidate other South China Sea dispute parties. Usually, grey zone situations involve a whole range of tactics and behaviour, however most common measures come down to faits accompli, deterrent ambiguities and proxy warfare.

The fit accompli strategy is best exemplified by China’s massive island-building and militarization of the disputed features in the South China Sea. These actions are complemented by a range of other initiatives, such as enforcing fishing bans in specific areas of the South China Sea and introducing new legal acts that extend the authority of maritime law enforcement agencies (often in violation of international law) or unilaterally establish administrative structures in the South China Sea. Such activities can be classified into deterrent ambiguities.

The fishing ban has been arbitrarily imposed by China since 1999 under the pretext of promoting sustainable fishing and improving marine ecology. This year’s edition is valid from May 1 to Aug. 16, covers waters 12 degrees north of the equator, and includes parts of Vietnam’s 200-mile exclusive economic zone (EEZ) and the Paracel Islands.[xi] Despite protests from Hanoi, the Chinese government has consistently continued this practice. It undermines any Vietnamese rights over the disputed area and simultaneously is an attempt to legitimize coercive action against Vietnamese fishermen.

In the context of legal actions, an example is the decision of China’s Ministry of Civil Affairs of April 2020, which established two new administrative structures: the Xisha and Nansha districts.[xii] Moreover, The Coast Guard Law promulgated in January 2021 is also a notable example due to the fact that Article 22 enables the China Coast Guard (CCG) to use weapons against foreign organizations and individuals that infringe on China’s sovereign rights and jurisdiction at sea.[xiii]

On top of that, there is the proxy warfare category. Thus, actions usually conducted by Chinese maritime militia with support from the CCG aimed at swarming, ramming foreign vessels, and blocking their access to disputed areas. The latter has recently been evident in the case of the friction between China and the Philippines. The CCG ship used a 'military-grade’ laser at one of the Philippine Coast Guard (PCG) vessel supporting a rotation and resupply mission of the Philippine Navy to the Philippine outpost on Second Thomas Shoal is the BRP Sierra Madre, which was deliberately stranded on the shoal in 1999. Moreover, the Chinese ship crossed the PCG ship’s bow, followed by other dangerous manoeuvres aimed at preventing a resupply mission[xiv]. Although the incident met with both an official protest from the government in Manila and a summoning of the Chinese Ambassador to the Philippines by President Ferdinand Marcos Jr., the Chinese side did not change its modus operandi, the best example being another incident that occurred two months later.[xv] This time a CCG ship blocked a Philippine patrol vessel in the vicinity of Second Thomas Shoal with a small group of journalists on board[xvi].

Even though Southeast Asian countries use diplomatic tools to oppose China’s harassment, they often fail to achieve the desired outcome. Two possible alternatives are available to these countries. Firstly, they can put efforts into developing a final version of the CoC, which is expected to set a framework for the behaviour of countries in the South China Sea more comprehensively and effectively than the DoC. Secondly, these countries can also bolster their own minimal deterrence capabilities by modernising armed forces to push back against China’s coercive tactics. The improvement of defence capabilities would increase the chances of enhancing security cooperation with other actors, such as the United States and Japan, which also face challenges from China.

Being played one by one – China’s bilateral approach

China pursues a two-track policy under which, on the one hand, it enforces assertive actions leading to strengthening its position in the South China Sea. Still, at the same time, Beijing engages in a negotiation process over the CoC to give itself more time to push bilateral solutions, which may lead to friction within ASEAN and among its members. It is evident, considering recent interaction between leaders of claimant states since the beginning of this year.

During the first state visit of Philippine President Ferdinand Marcos Jr. to Beijing in January 2023, there was an announcement of the resumption of bilateral talks on the joint extraction of natural resources from the disputed areas of the Spratly archipelago.[xvii] It was followed up by the Department of Foreign Affairs of the Philippines from the beginning of April, which announced conducting the first talks with China on this matter in May, despite ruling out such activities by the Supreme Court in January.[xviii] The court decided that a trilateral joint exploration agreement signed by the Philippines, China and Vietnam in 2005 was unconstitutional because it allowed “wholly-owned foreign corporations to participate in the exploration of the country’s natural resources” without proper safeguards.[xix] It is worth mentioning that former President Rodrigo Duterte also took steps towards oil and gas exploration with China in 2018. Still, the initiative collapsed last June after the two sides failed to agree on the issue of sovereignty over Reed Bank in the Spratly Islands.

Meanwhile, Malaysian Prime Minister Anwar Ibrahim announced that during his recent visit to Beijing in April, he expressed the Malaysian government’s readiness to negotiate with China on joint energy exploration in contested waters of the South China Sea.[xx] In both cases, the desire to pursue negotiations with China over joint exploration met with criticism on the internal political scene of each country. However, a much more important issue – as Carlyle Thayer points out – is how Xi Jinping used the visits of the Philippine and Malaysian leaders to push China’s claims in the South China Sea and to promote bilateral discussions.[xxi] Both state visits were crowned with the signing of multi-billion-dollar contracts, and thus Beijing continues to use its economic tools in relations with ASEAN countries to dictate more favourable terms where the core interests of Beijing are concerned.

Nonetheless, it is worth emphasizing that the Chinese strategy also entails a certain risk for Beijing, as putting pressure on the countries to pursue joint development through bilateral talks and setting aside disputes can strengthen nationalist sentiments in these countries and the growth of anti-Chinese sentiments. Furthermore, the coercive measures and grey zone tactics can encourage them to seek protection in the United States and its allies.

Building up the “integrated deterrence”

The attitude of China in the case of negotiations on the CoC as well as the actions of the Chinese fleet in the disputed areas of the South China Sea largely determines the process of implementing the US-led “integrated deterrence” strategy in the Indo-Pacific region. The best example of this process is the efforts to modernise the U.S.-Philippine alliance, which has been recently visible with strengthening cooperation under the Enhanced Defense Cooperation Agreement (EDCA). Over the past few months, the United States has been able to negotiate with the government in Manila to gain access to four new military facilities in the Philippines, including those close to Taiwan’s southern shores and the Western portions of the South China Sea. This was a decision of historical importance, as it opened the possibility of increasing the rotational presence of American troops in the Philippines for the first time since the closure of permanent Subic and Clark bases in the early 1990s.[xxii] In addition, on April 11, both countries launched the largest Balikatan exercise in more than 30 years, with over 17,600 troops from both countries, together with over 100 Australian forces and observers from Japan.[xxiii] The event gained additional significance because Ferdinand Marcos Jr. was the first Philippine president to witness the exercise in person, observing a joint live fire exercise and the first ever-drills to sink the target ship, a decommissioned Philippine Navy corvette BRP Pangasinan.[xxiv] This is a direct result of the failure of the appeasement policy initiated by former Philippine President Rodrigo Duterte, who focused on strengthening cooperation with China at the expense of relations with the United States. Despite far-reaching concessions to Beijing, especially on issues related to disputes in the South China Sea, China continued its expansionist policy, which posed an increasing threat to the sovereignty of the Philippines. The attitude of the Chinese government made Duterte’s successor Ferdinand Marcos Jr. decide to balance the state’s foreign policy, which in less than a year of his presidency, had been dominated by the restoration of relations with Washington. Evidence of this shift can be seen in his recent visit to the United States – the first official visit by a Philippine president to the US in almost a decade – during which he met with President Joe Biden in early May. One of the key results of the talks between the leaders of the two countries was another American declaration regarding enhancing the capabilities of the Philippine Armed Forces. The White House announced a plan to transfer two Island-class patrol vessels, two Protector-class patrol vessels, and three C-130H aircraft, pending applicable Congressional notification requirements. Meanwhile, two Cyclone-class coastal patrol vessels were transferred to the Philippines in late April this year.[xxv] Based on this, it can be inferred that the US administration recognises the requirements of the Southeast Asian region and, with the right attitude of countries from this region, is willing to endorse any efforts aimed at improving their defence capabilities and enhancing maritime domain awareness.

Other countries in Southeast Asia may learn from the experience of the Philippines and decide to follow suit. A particularly interesting case is Vietnam, which, despite its defence policy based on the so-called „Four No’s”, may choose to upgrade its bilateral relations with the United States to a strategic partnership in the future. Speculation on this matter has recently intensified due to the 10th anniversary of the U.S.-Vietnam Comprehensive Partnership launched by Barack Obama in 2013. The United States is very keen on balancing Chinese influence in Vietnam, and the last visit of the U.S. Secretary of State Antony Blinken in Hanoi confirmed that talks are in progress.[xxvi] Of course, American military cooperation with Vietnam would not have the same scope as in the case of the Philippines, but tightening economic cooperation between the countries would limit China’s ability to use economic tools to impose pressure on the Vietnamese government. Even if the formal rank of relations wouldn’t be raised, advancing relations in substance in areas of mutual interest should still be expected. These areas include increasing Vietnamese capabilities in the maritime security domain, which is best evidenced by the plans to transfer a third Hamilton-class vessel to the Vietnamese Coast Guard under the U.S. Excess Defense Articles (EDA) program.


  1. China needs to maintain dialogue with ASEAN claimant states through the Code of Conduct negotiation to avoid the risk of these countries falling under the more significant influence of the United States and like-minded countries.
  2. Given the range and complexity of the issues being negotiated in the Code of Conduct, and the consensus-based decision-making process of ASEAN, it is unlikely that a substantive agreement will be reached in the foreseeable future.
  3. Instead of waiting for the conclusion of the Code of Conduct negotiations, South China Sea dispute parties should pursue parallel negotiations to address specific issues and reduce regional tensions.
  4. The Southeast Asian nations with South China Sea claims vulnerable to China’s coercive actions should develop their minimal deterrence capabilities through armed forces (especially the navy and air force) and maritime law enforcement agencies (e.g. coast guard) modernisation to thwart China’s grey zone efforts to dominate the South China Sea.
  5. The United States should enhance its economic cooperation with Southeast Asian countries in order to counter China’s use of economic leverage to gain strategic advantages in the region.
  6. Drawing on the Philippines’ failed appeasement policy towards China introduced by Rodrigo Duterte, the United States should leverage this experience to encourage other claimant states to adopt a more decisive strategy to China’s coercive actions in the South China Sea (e.g., by consistently publicizing Chinese actions in the South China Sea).
  7. The transfer of equipment by the United States to Southeast Asian countries is a viable approach to enhancing maritime security capacity-building assistance. However, it may be insufficient without corresponding efforts to bolster key intangible factors such as national political will and interagency cooperation.


Author: Dr Mateusz Chatys, Senior Specialist, Centre For Asian Affairs, University of Łódz


[i] Raul Dancel, „Asean, China adopt framework of code of conduct for South China Sea”, The Straits Times, August 6, 2017,

[ii] Carl Thayer, „A Closer Look at the ASEAN-China Single Draft South China Sea Code of Conduct”, The Diplomat, August 3, 2018,

[iii] Ian Storey, „Assessing the ASEAN-China Framework for the Code of Conduct for the South China Sea”, ISEAS Perspective, August 8, 2017,

[iv] Lee Chyen Yee, „Chinese Premier Li says talks on South China Sea code should end in three years”, Reuters, November 13, 2018,

[v] Nana Shibata, Bobby Nugroho, „ASEAN and China aim for South China Sea 'hotline’ trial in 2023”, Nikkei Asia, March 10, 2023,

[vi] Nobuhiko Tajima, „Japan sets up ASEAN hotline to boost security communications”, The Asahi Shimbun, March 13, 2023,

[vii] Laura Zhou, „South China Sea rivals agree to set up hotline ‘to cope with emergencies’”, South China Morning Post, June 2, 2021,

[viii] „Manila, Beijing agree to establish hotline to avoid South China Sea mishaps”, Radio Free Asia, January 5, 2023,

[ix] Mark Valencia, „Compromises necessary for Code of Conduct in S China Sea”, Asia Times, April 12, 2023,

[x] See Twitter:

[xi] „Vietnam opposes China’s unilateral South China Sea fishing ban”, Reuters, April 20, 2023,

[xii] Huong Le Thu, „Fishing While the Water Is Muddy: China’s Newly Announced Administrative Districts in The South China Sea”, Asia Maritime Transparency Initiative, May 6, 2020,

[xiii] Wataru Okada, „China’s Coast Guard Law Challenges Rule-Based Order”, The Diplomat, April 28, 2021,

[xiv] „Philippines accuses China of aiming ‘military-grade’ laser at coast guard vessel in South China Sea”, The Straits Times, February 13, 2023,

[xv] Sofia Tomacruz, „Marcos summons China envoy over laser incident”, Rappler, February 14, 2023,

[xvi] Jim Gomez, „Tense face-off: Philippines confronts China over sea claims”,, Associated Press, April 29, 2023,

[xvii] Azer Parrocha, „Marcos hoping for revival of oil exploration talks with China”, Philippine News Agency, January 4, 2023,

[xviii] Kaycee Valmonte, „Preparatory talks with China on joint oil, gas exploration to begin in May — DFA”, Philstar Global, April 4, 2023,

[xix] „Parameters for exploration of oil, other resources made clearer by SC verdict”, Manila Bulletin, January 13, 2023,

[xx] Richard Javad Heydarian, „China at the heated center of Malaysia’s new politics”, Asia Times, April 11, 2023,

[xxi] „Manila, Kuala Lumpur to negotiate with Beijing in South China Sea”, Radio Free Asia, April 5, 2023,

[xxii] Richard Javad Heydarian, „China roars as Philippines opens wider to US forces”, Asia Times, April 4, 2023,

[xxiii] Cliff Venzon, „Philippines, U.S. hold biggest-ever drills to counter China”, Nikkei Asia, April 11, 2023,

[xxiv] John Eric Mendoza, „Bongbong Marcos gains ‘deeper appreciation’ of Balikatan during visit — official”, Inquirer, April 26, 2023,

[xxv] „Investing in the Special Friendship and Alliance Between the United States and the Philippines”, The White House, May 1, 2023,

[xxvi] Sebastian Strangio, „Blinken Bound for Vietnam as US Pushes for Upgrade in Relations”, The Diplomat, April 14, 2023,