The Code of Conduct for the South China Sea: A Waiting Game

On June 30, 2013, following the China-ASEAN Foreign Ministers’ Meeting held in Bandar Seri Begawan, capital of Brunei, China released a joint-statement with ASEAN in a post-meeting press conference, indicating that they have agreed to hold “official consultations” on a proposed Code of Conduct (CoC) to govern South China Sea “naval actions”. All parties agreed to move forward with consultations in upcoming meetings to be held in China during September later this year.

Misleadingly or mistakenly billed as a significant paradigm shift by many English language news outlets, this development should not have come as a surprise to anyone. As early as November 2012, China already issued a joint statement with ASEAN at the 15th ASEAN-China Summit in Phnom Penh, Cambodia, marking the 10th anniversary of the Declaration on the Conduct of Parties in the South China Sea (DOC) and agreeing to “keep momentum of dialogue” in moving towards a formal Code of Conduct (COC).  China also reiterated this commitment in April this year, following the 19th China-ASEAN Senior Officials’ Consultation.

For the casual observer, keeping track of the ins-and-outs of numerous ASEAN-China agreements and cryptic diplomatic sparring over South China Sea (SCS) disputes can be daunting. News reporting differs greatly depending on its country of origin and the same story can be told in a hundred different ways leaving entirely different impressions of what happened. The following is a breakdown of the important historical, political, and legal considerations necessary to understand what the Code of Conduct for the SCS is, why it is important, and how it may eventually come about.

The DOC: “They’re more guidelines than rules”

In order to understand what the Code of Conduct is, first one must understand what it’s predecessor, the Declaration of Code of Conduct of Parties in the SCS (DOC), isn’t. The DOC came about due to heightened tensions in the SCS back in the early to mid-1990s, as increasingly prosperous Southeast Asian countries butted heads with each other and with China over fisheries and other resources. In order to head off potential conflict, ASEAN and China issued a joint statement in 1997 indicating that they would begin negotiations over the SCS. Around the same time, most ASEAN countries and China were also in the accession process to multilateral associations like the World Trade Organization (WTO) and the United Nations Convention on the Law of the Seas (UNCLOS). Thus, all countries were on particular good behavior in order to not sabotage their international goodwill. In 1999, ASEAN states (who at that time viewed China positively due to its ability to stabilize the East Asian region midst the post Asian Financial Crisis turmoil) approached China to begin negotiations over a Code of Conduct for the SCS. By November 2002, ASEAN and China signed the Declaration on the Conduct of Parties in the SCS (DOC).

The DOC contained the following agreements:

  1. Acknowledgement of territorial disputes;
  2. Requirement that all Parties adhere to “international norms” of behavior, namely to resolve disputes “without resorting to the threat or use of force”;
  3. To respect freedom of navigation;
  4. To exercise “self-restraint” so as not to “complicate or escalate” disputes (most importantly, not to “inhabit” non-occupied features or upgrade existing infrastructure on occupied features);
  5. To undertake cooperative confidence building measures (CBMs) and to conduct consultations and dialogues;
  6. And to work toward a formal Code of Conduct.

More important than what the DOC contained however, is what it did not contain. First and foremost, the DOC is not binding. China fought hard to designate the agreement a “declaration”, which is simply a political statement of intent, rather than a “code” an actual binding legal agreement, which Vietnam and the Philippines preferred. As a compromise, the DOC did include for its last principle the requirement that the DOC process would eventually lead to a COC. China also succeeded in deleting a reference to the geographical scope of the DOC. Vietnam wanted the Paracles named, but China and Malaysia did not.

Empty Declarations

Simply agreeing upon the DOC was not the end of the battle. It took nearly ten years after the signing to actually implement the DOC. In 2011, ASEAN and China agreed upon the Guidelines for the Implementation of the Declaration of Conduct (DOC) in the South China Sea. Why did the diplomatic process break down after 2002? The story varies depending on which party tells it. Attempts to revive negotiations in 2004, 2006, and 2008 all collapsed because of the increasing frequency of confrontations over SCS resources. According to China, the other Claimant States have not demonstrated goodwill in adhering to the agreed upon principles in the DOC. An oft-used example is the Joint Marine Seismic Undertaking(JMSU) that China’s National Offshore Oil Company (CNOOC) signed with Vietnam Oil and Gas Company (VOGC) and Philex (PNOC) in 2005.[1] Although the JMSU was originally proposed by the Philippines, Philippine domestic political controversy eventually nulled the agreement, and both Vietnam and the Philippines began to unilaterally develop oil and gas resources in disputed areas of the SCS, to the dismay of China.

According to ASEAN claimants, China is mostly responsible for the collapse of the DOC process because it has actively worked to delay and derail negotiations. Some ASEAN members felt that China was not negotiating in good faith because it made impossible requests. For example, China opposed the inclusion of a clause in the DOC Guidelines that stated that ASEAN members would consult amongst themselves prior to meeting with China. However, ASEAN had incorporated into its 2007 charter that members were required to “coordinate and endeavor to develop common positions” in the conduct of external relations. By July 2011, in order to move forward, ASEAN agreed to drop the formal statement that its members would consult before meeting with China, but it was generally understood that ASEAN intended to continue with prior consultations, regardless. The resulting guidelines were vague and did little more than repeat the principles laid out in the DOC.

ASEAN Dis-unity

For a while following the 2011 breakthrough, ASEAN appeared to be unified on the SCS matter vis-à-vis China. However, a breakdown during the following ASEAN Summit in June 2012 revealed natural fault lines in the organization. Following each summit, ASEAN traditionally issues a joint communiqué expressing common goals. However, ASEAN failed for the first time to issue this joint communiqué in 2012 because of a major disagreement between Cambodia and the Philippines. Cambodia, which held the Chair of ASEAN that year, wanted to include in the communiqué a call not to “internationalize the SCS disputes”. However, the Philippines vehemently protested because it felt Cambodia was doing this at the behest of China (which it was) in order to counter the increasing involvement of the United States (which the Philippines supported). Very public and vocal incriminations against Cambodia were thrown around, however it soon became clear that Cambodia was not the only country in ASEAN that had concerns regarding making the SCS a flash point with China.

Analysts noted that the polarizing South China Sea issue was having a balkanizing effect on ASEAN. There are what Taylor Fravel calls the “frontier sovereignty dispute” countries, namely the Philippines and Vietnam, who have the most at stake in the SCS and are therefore the most vocal in their conflict with China. Then there are Claimant States who have disputed areas with China but mostly on the periphery and are in more conflict with other ASEAN states than they are with China. These “periphery sovereignty dispute” states are Malaysia and Brunei. Then there are middle-of-the-road states, which have no direct conflict with China in the SCS but have “significant interest” in the outcome. Among these, Indonesia tends to be anti-China, Thailand is more pro-China, and Singapore appears to be neutral. Finally, there are countries, often smaller and economically weaker inland countries that are “inclined to accommodate” China – Cambodia, Laos, and Myanmar. Thus, out of 10 members, only 20% (two countries) are keen on making the SCS disputes a central issue for ASEAN-China relations. At most, 50% (five countries) are inclined to make the SCS disputes a key issue. The breakdown in ASEAN unity over the SCS issue may not be as surprising as is oft portrayed.

Is China playing the same old game?

Since the 2012 controversy over Cambodia and increasing tensions since 2011, China has taken on a more conciliatory diplomatic tone, and part of that is its agreement to move forward with negotiations on a binding Code of Conduct. However, other claimants dismiss China’s overtures, accusing it of playing the same old game of “talk-and-take”, of delaying discussions while it consolidates its own claims. Other claimants are fearful that China will continue with its Cambodia strategy and “Finlandize” ASEAN states, or “分别对特,各个击破” (“treat each case differently and defeat each one separately”) in Chinese.  This asymmetric power play assumes that China will use indirect economic coercion to force weaker ASEAN states to act as its puppets in SCS negotiations with ASEAN.

However, this process of “Finlandization” perhaps does not give enough credit or agency to the smaller ASEAN countries. While it is true that many ASEAN members have significant economic stakes in China, the same can be said in reverse, that China has significant stakes, political and economic, in ASEAN countries. The tactic of “buying” allies only works for a little while, and China is already finding (through its experience with Myanmar) that allies in ASEAN are becoming more expensive and harder to keep. China is fully aware that it cannot continue to rely on weak and uncertain allies in ASEAN.

New Dynamism

Besides this, the time is ripe for China to make build more diplomatic goodwill with its southern neighbors. Much of the goodwill built from its charm offensive in the early-to-mid 2000s have been negated by increasing tensions and confrontations in the SCS, most notably with the Philippines over Scarborough Shoal and most recently, the Second Thomas Shoal. 2013 is the 10th anniversary of the ASEAN-China Strategic Partnership and the Declaration of Conduct. This is the ideal time for China to gain the most symbolic impact in shifting its discourse with ASEAN. What’s more, this conciliatory shift will occur in China, on its own turf. Following recent political transition, China’s new leaders may be seizing this opportunity to present a “new dynamism” to the world and rebuild goodwill with ASEAN.

Philippines Arbitration

On the other hand, China’s agreement to move forward with the Code of Conduct may also be politically calculated. By indicating a conciliatory shift, China has effectively taken the wind out of the Philippines’ ITLOS tribunal case. One of the Philippines’ main accusations is that China has not been negotiating in goodwill and therefore forced the Philippines to bring China to arbitration unilaterally. Furthermore, it is an open secret that many other ASEAN members did not support the Philippines’ unilateral ITLOS submission. One diplomatic source reported that some ASEAN officials feared that Philippine actions ‘have breathed all the life out of the COC process’. China, by indicating that it is willing to move forward with the COC, has deflated the impetus behind the Philippines’ case.

The US: Pink Elephant in the SCS

Most of all however, China may have realized that negotiating directly with ASEAN is the most desirable option compared to other multilateral platforms. Despite its continued vocal position that China will only negotiate bilaterally on SCS disputes, the truth is that China has already and must continue to accept a certain degree of multilateral negotiations. ASEAN has forced this issue through its own unity and more importantly, America’s Asia Pivot has internationalized the SCS issue, regardless of China’s wishes. The United States’ increasing presence and realignment of resources in the Pacific have changed the dynamics of the field, and China realizes that this is not the time to press “bilateral” negotiations. But at the same time, China knows that ASEAN+1 (direct China-ASEAN negotiations) is a much more favorable multilateral platform than ASEAN+3 (which includes Japan and Korea), or ASEAN+6 (aka the East Asia Summit which includes India) or the Asia Pacific Economic Cooperation (APEC), which is led by the US, or the Asia Regional Forum (ARF), which includes the US, India, Japan, and Russia, amongst others. In order to prevent the internationalization of the South China Sea disputes, China must accept regionalization.

What will the Code of Conduct look like?

Long before China agreed to move forward with the COC, ASEAN members, under the leadership of its largest member, Indonesia, have already jointly drafted a COC as the basis for their negotiations with China. ASEAN’s foreign ministers unanimously reached agreement on ‘Proposed Elements of a Regional Code of Conduct in the South China Sea (COC) between ASEAN Member States and the People’s Republic of China’ in July 2012, during the 45th AMM but this effort was given little media attention amidst the Cambodia controversy. Later 2012, Indonesia got all ASEAN members to endorse the “ASEAN’s Six-Point Principles on the South China Sea” which Indonesia then incorporated into what is known as the “Zero Draft COC” presented to ASEAN in September 2012 and agreed upon as the basis for negotiations with China. The Zero Draft is not publicly available, but according to early reviewers of the document, the main components reflect mostly the language of its predecessor, the DOC. Its main articles include:

  • Articles 1 & 3: Reiterate the six-point principles of non-violence, self-restraint, and respect for international norms;
  • Article 2: Promote confidence, prevent incidents, and manage/resolve incidents;
  • Article 4: Stipulates the areas to which the COC applies, which is to ‘all unresolved maritime boundary areas of the parties concerned in the South China Sea’;
  • Article 5: Legal disclaimers, including
  1. Nothing contained in this COC shall be interpreted as: Renunciation by any Party of previously asserted rights of or claims to territorial sovereignty in the South China Sea; Prejudicing the position of any Party as regards its recognition or non-recognition of any others State’s right of or claim or basis of claim to territorial sovereignty in the South China Sea;
  2. No acts or activities taking place while the present COC is in force shall constitute a basis for asserting, supporting or denying a claim to territorial sovereignty in the South China Sea or create any rights of sovereignty in the South China Sea;
  3. The Parties concerned undertake to resolve their territorial and jurisdictional disputes by peaceful means, without resorting to the threat or use of force, through friendly consultations and negotiations by sovereign states directly concerned;
  • Article 6: detailed and potentially contentious stipulations on how to implement the COC, including provisions on how to manage collisions and other incidents;
  • Article 7: left the precise monitoring and reporting mechanism to be agreed in future between China and ASEAN;
  • Article 8: outlined potential dispute settlement mechanisms;
  • Article 9: calls for a ministerial level review mechanism every five years, amongst other administration concerns like registering with the UN and entry into force.

According to the official ASEAN calendar of 2013 meetings, the consultations will likely occur towards the end of September, on the sidelines of the 10th ASEAN-China Expo, scheduled this year in Nanning, China. ASEAN will have to move quickly if it hopes to get the COC in place. The Chair this year, Brunei, has given SCS priority on ASEAN’s agenda, but the chair goes to Laos in 2014, for which the SCS is not a priority (the country that has the chair of ASEAN sets the agenda for the year). After Laos, Malaysia has the chair in 2015, followed by Myanmar. It is all together possible that depending on how much negotiations are delayed, the formal Code of Conduct for the South China Sea may not be in place until 2017 or 2020, when the Philippines and Vietnam respectively hold the ASEAN chair.


[1] Nanhai Institute, “Functional Cooperation and Joint Development: A Way ahead in the SCS.” Rommel C. Banlaoi

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Filed under ASEAN, Brunei, Cambodia, China, Current Events, Energy, Foreign policy, Indonesia, Laos, Malaysia, Myanmar/Burma, Philippines, Regional Relations, Singapore, Thailand, Vietnam, water

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