Chinese frigates in formation during a maritime training exercise in the South China Sea. Photo: PLA / Zhang Bin

An agreement between the Association of Southeast Asian Nations and China on a binding, robust Code of Conduct (COC) for the South China Sea has become a test of ASEAN’s relevance and centrality in the management of security issues in its region. 

Some say it is a holy grail – a highly desirable but unreachable goal. Others say it is ASEAN’s last hope to prove its effectiveness. But there are many obstacles that must be overcome to reach agreement.

 ASEAN has been struggling for 20 years to lock China into a COC. But the talks have stalled. Last week’s ASEAN Summits Chairman’s Statement emphasized “the need to promote an environment conducive to the COC negotiations.” This indicated growing frustration at the seemingly endless delay as well as interference by the big powers.  

There are formidable obstacles to agreement on key elements like its geographic scope, means of dispute settlement if any, legal status and role of third parties. The positions remain far apart, and the August 2018 Single Draft South China Sea Code of Conduct Negotiating Text contains some proposed provisions that are probably unacceptable to China.

Vietnam is trying to use ASEAN and the COC against China to advance its position in its bilateral dispute over sovereignty of the Paracel Islands. Vietnam insists that the Paracels and their attendant maritime jurisdictional zones be included. China argues that it has “undisputed” sovereignty over the Paracels and that in any case, the conflicting claims are only between it and Vietnam and thus not an issue or area that should be included in an ASEAN-China agreement. 

Neither is likely to yield on this issue, as they would be strongly criticized by domestic nationalists. In 2002, a lack of agreement on this issue resulted in the attempt to negotiate a COC being downgraded to an ambiguous, exhortatory, non-binding Declaration on the Conduct of Parties in the South China Sea (DOC). 

This matter may be finessed by not specifying the area to be covered by the Code. But that means its scope will be ambiguous and open to different interpretations and thus further dispute.

The draft does not contain any reference to binding dispute-settlement mechanisms. There are proposals to refer disputes to various mechanisms, but those proposals stipulate that such referrals be only at the consent of the parties. If this stands, the COC will in essence be non-binding.  

China’s long-held position is that disputes between nations should be resolved by negotiations between the parties directly involved, not third parties. It has long complained – with some justification – that other claimants have not abided by the DOC article that states “The Parties concerned undertake to resolve their disputes”­ ­through friendly consultations and  negotiations by sovereign states directly concerned (emphasis added).

China also believes that non-parties to its disputes with other claimants should not have a say in their resolution, let alone ASEAN as a whole.

As for the COC’s legal status, the draft does not specify that it will become a treaty. But China – and perhaps some others – is unlikely to agree to a legally binding document. But Vietnam has proposed a provision that the COC “be subject to ratification in accordance with the respective internal procedures of the signatory States” and that the ratifications be registered with the ASEAN Secretary General. 

Finally, the role of third parties such as the US, Japan, Australia, India and others remains undefined. There are no proposals for their accession, and China would prefer that the COC remain between it and ASEAN.

Making negotiations even more difficult, they have become infused with the US-China contest for domination of the South China Sea and the region. Beijing has proposed provisions that would restrict military exercises and exploitation of petroleum resources to regional countries. In Beijing’s view, such exercises and leasing areas to external-power oil companies have long been used by Southeast Asian claimants and the US to intimidate China.

 Of course the US opposes this and has called for “more transparency” in the negotiations. Indeed, in a clear rebuke to these proposals, Australia, Japan and the US issued a joint statement that the COC should be “consistent with existing international law, as reflected in UNCLOS; … not prejudice the interests of third parties or the rights of all states under international law; … reinforce existing regional architecture; and … strengthen parties’ commitments to cease actions that would complicate or escalate disputes.”  

The US fears that the COC may somehow legitimize China’s claims and actions that the Americans have called “unlawful” such as its nine-dash-line historic-waters claim, and construction and militarization on features it occupies. The US would probably rather see no COC than one not in its interests.

The Cambodia factor

Another major obstacle to agreement in the near future is that the ASEAN Chair for 2022 is Cambodia. Cambodia is probably closer to China politically than any other ASEAN member. In May, in reference to development assistance, Cambodian Prime Minister Hun Sen famously declared, “If I don’t rely on China, who will I rely on?” 

In 2012 and again in 2016, Cambodia stood fast in opposing an ASEAN statement unfavorable to China. It may well stand with China in asserting that claimant states should address their disputes with China bilaterally. 

Agreement on a COC is so difficult because the parties proceed by the ASEAN principle of consensus. This means that one stubborn holdout can prevent agreement, even if that country is not directly affected by the issue at hand. This can work to China’s advantage if it wants to delay or dilute an agreement. 

Only four ASEAN members are claimants: Brunei, Malaysia, the Philippines and Vietnam. But there is also overlap between China’s nine-dash-line claim and Indonesia’s EEZ (exclusive economic zone) claim. Laos and Cambodia seem to side consistently with China on the South China Sea issues, while the other non-claimants try to stay neutral.

US-China row vs ASEAN ‘centrality’

If ASEAN and China could agree on a formal COC, it could provide a shaky status quo and keep the US and its allies at political arm’s length. But then the issue would become, what happens when a country violates the COC? This in turn depends in part on the parties to it.  Can, should, would the US, Japan and Australia be allowed to join? If so, that would make its implementation subject to the ebb and flow of the US-China contest.

The core of the problem is that ASEAN has tried to face China collectively and unanimously. But the burgeoning US-China struggle for domination of the region is tearing the region and ASEAN apart. Its solidarity is fragile and fleeting. 

So what can be done? ASEAN has shown it can act when absolutely necessary to preserve its credibility. After much prevarication and debate, it finally addressed the situation in Myanmar by trying to mediate and when its efforts were rejected, it disinvited junta leader General Min Aung Hlaing from the ASEAN Summits. 

This was not unanimous, although others did not strenuously oppose the action. However, even this decision may have been influenced by outside powers. It was alleged that some external countries such as the US and others applied pressure by threatening to boycott the Summits if he were allowed to attend. Nevertheless, ASEAN did act.

Regarding the South China Sea situation, a subset of ASEAN – say, the rival claimants –could take the lead, agree on their own COC and open it for accession by others such as China, the US, Australia, Japan and India. This would lock them in to an ASEAN-driven and -centered COC.

Of course the meaning of the provisions would become the next struggle. But if the language is legally tight, it would narrow the maneuvering room. This would be one way to regain ASEAN “centrality” and credibility in mitigating the South China Sea disputes. 

Mark Valencia

Mark J Valencia is an internationally recognized maritime policy analyst, political commentator and consultant focused on Asia. Most recently he was a visiting senior scholar at China’s National Institute for South China Sea Studies and continues to be an adjunct senior scholar with the Institute. Valencia has published some 15 books and more than 100 peer-reviewed journal articles.