The Elusive Code: Why ASEAN Needs a New Playbook for the South China Sea

INTRODUCTION

The South China Sea (SCS) remains one of the most consequential flashpoints in Southeast Asia, posing a direct challenge to ASEAN’s credibility, unity and its role as a stabilising force in the region. Following the adoption of the Declaration on the Conduct of Parties in the South China Sea (DOC) in 2002, ASEAN and China began discussions on the Code of Conduct (COC) in 2014, which were followed by the official commencement of negotiations in 2018. However, to date, little progress has been made. The COC remains more aspirational than operational; negotiations have been bogged down by strategic ambiguity, asymmetries of power, and fundamental differences in legal interpretations and national interests. China’s growing economic leverage and diplomatic influence over some ASEAN members have further complicated the push for a binding and meaningful agreement.

While China is often seen as the main obstacle, internal divisions within ASEAN are just as debilitating. Claimant states—namely the Philippines, Vietnam, Malaysia, and Brunei—hold overlapping claims and differ in political will and threat perceptions. Non-claimant states, meanwhile, tend to prioritise economic ties with China and regional stability over confrontation. These divergences make forging a common ASEAN position on the South China Sea exceedingly difficult. The inability of existing diplomatic frameworks to manage rising tensions reflects the deeper strategic reality that the South China Sea is not merely a legal or policy issue dealing with overlapping claims. For China, it is about asserting control and reshaping regional norms, while for ASEAN, it is about preserving institutional relevance and regional equilibrium.

This urgency is reflected in the State of Southeast Asia 2025 Survey, where 51.6 per cent of respondents identified the South China Sea as the region’s top geopolitical concern (Figure 1). A clear majority also called on ASEAN to adopt a principled stand that upholds international law, including the 1982 United Nations Convention on the Law of the Sea (UNCLOS) in managing the dispute, underscoring rising expectations for stronger ASEAN agency (Figures 2 and 3). Against this backdrop, ASEAN must not only revive the COC process but fundamentally rethink its maritime diplomacy toolbox.

Figure 1: What are the top three geopolitical concerns for the government in your country?

Figure 2: How should ASEAN respond to the SCS situation? (Choose 2 options)

Figure 3: In my view, the Code of Conduct (COC)…(Choose 1 option)

Indonesia pushed in 2023 for a conclusion to the COC by 2026; this timeline now appears increasingly unrealistic. Key issues remain unresolved (see section 2). Geography itself compounds the difficulty: the South China Sea does not have sufficient maritime space for all claimants to enjoy full exclusive economic zones (EEZs) and continental shelf entitlements without overlap. With coastlines in close proximity and many claims being based on disputed features, overlapping entitlements are inevitable, even under strict interpretations of UNCLOS. China’s assertion of “historic rights” further complicates the legal terrain, making maritime delimitation extremely challenging. This shows that tensions in the South China Sea are not only legal and political, but also structural, and require adaptive, pragmatic approaches to manage rather than rigid formulas embedded in a legally binding COC.

In light of shifting geopolitical dynamics, the COC should be reimagined not as a definitive end goal, but as a living instrument. A legally binding COC remains a long-term aspiration, ASEAN must be prepared to wait. In the meantime, the focus should be on interim enforceable agreements that are realistic and regionally credible. The real danger is not delay, but the adoption of a weak COC that, in effect, provides the illusion of a completed job and forestalls further progress. ASEAN must resist viewing the COC as a one-time product and instead treat it as an evolving framework that is refined incrementally until it is capable of meaningfully shaping behaviour and preserving stability in the South China Sea. This article examines how ASEAN can break away from conventional negotiation frameworks and explore pragmatic pathways that prioritise immediate enforceable outcomes while preserving ASEAN centrality.

WHY THE COC REMAINS ELUSIVE

ASEAN has made repeated efforts to coordinate its diplomatic messaging, including through the 2023 ASEAN Foreign Ministers’ Statement on Maintaining and Promoting Stability in the Maritime Sphere. This statement reaffirmed key principles such as freedom of navigation, peaceful resolution of disputes, and respect for international law. However, these commitments remain insufficient to provide the coherence needed to strengthen ASEAN’s negotiating position. Diverging strategic priorities among member states, as well as varying levels of alignment with China and extra-regional powers, have made it difficult for ASEAN to present a unified front in the COC negotiations.

At the same time, individual ASEAN claimant states have moved beyond waiting for a concluded COC framework to pursue their national strategies. The Philippines has adopted a policy of ‘assertive transparency’, strengthened its military ties with the United States and its allies such as Japan and Australia, and concluded a Reciprocal Access Agreement with Japan in 2024. It is also nearing similar pacts with Canada, New Zealand, France, and other countries. Vietnam, meanwhile, has dramatically expanded its military presence in the Spratlys—dredging land at a rate that could match China’s acreage by 2025—and deepened defence cooperation with the US and other partners. These efforts are not an abandonment of the COC process but reflect a growing recognition that the negotiations are unlikely to produce tangible outcomes in the near term. While diplomatically supporting the COC process, claimant states are supplementing it with parallel strategies to safeguard their maritime interests. The State of Southeast Asia 2025 Survey confirms this. While 69.5 per cent of regional respondents want ASEAN to uphold international law, 46.1 per cent also support participating in joint military exercises to deter aggressive behaviour—suggesting that ASEAN countries are stepping up both legal and security-based responses.

These developments increasingly call into question the relevance of the COC. Its prolonged gestation has eroded its perceived utility, leading many observers to ask whether it is simply arriving too late to shape the strategic realities on the water—realities now defined by militarised artificial islands, unilateral resource activities and expanded defence partnerships with external powers. While the COC is often viewed as a comprehensive instrument that will bring peace and stability by setting clear legally binding rules of behaviour and reducing the risk of incidents, it was never designed to resolve sovereignty and maritime delimitation issues. It cannot determine who owns which features, nor can it adjudicate overlapping EEZ and continental shelf claims. These fundamental issues lie beyond the scope of the COC and must instead be addressed through bilateral negotiations or legal processes under UNCLOS.

Furthermore, China’s expansive claims, rooted in historical narratives and national legitimacy, remain non-negotiable under President Xi’s leadership. This makes China resistant to any COC text that would dilute its control or open the door to international scrutiny. While it may support a legally binding COC, it will likely do so only if its preferred language is accepted. Chinese proposals have included clauses to prevent joint military exercises and oil and gas development with external actors, as well as prior notification and consent mechanisms that would effectively give Beijing a veto over regional partnerships. Such provisions would severely constrain ASEAN’s strategic flexibility.

Equally important, China rejects the exclusive application of UNCLOS in the South China Sea. It continues to assert “historic rights” within the expansive nine-dash line, directly contradicting the 2016 arbitral tribunal ruling that invalidated those claims. This legal divergence sits at the core of the COC’s stagnation. While most ASEAN claimant states would like UNCLOS to be the sole legal basis for maritime entitlements, some non-claimant ASEAN members, including Cambodia, Laos and Myanmar, are more inclined to accept broader references to “universally recognised principles of international law”. While this does not equate to support for China’s nine-dash line claims, it reflects a diplomatic tendency to avoid directly confronting China’s legal position. This lack of legal consensus makes a binding COC effectively impossible. Without agreement on which legal framework governs the disputes, the COC would lack the clarity and shared understanding needed to ensure compliance and dispute resolution or enforcement.

These legal and political divisions are mirrored in the unresolved sections of the draft text. Despite reaching its third reading, key issues remain heavily bracketed. These include the COC’s geographical scope, its relationship with the 2002 DOC, and definitions of critical terms such as “disputed feature,” “incident,” “self-restraint,” etc. China has also made it clear that it will not dismantle its militarised artificial features and opposes including ASEAN-China oversight mechanisms in the final text. Beijing prefers to keep the COC a political document—flexible, non-binding and detached from ASEAN-led accountability. By resisting ASEAN’s proposals for reporting and monitoring, China ensures the document will neither constrain its actions nor legitimise third-party engagement.

Given these challenges, it is increasingly clear that the current approach to the COC—aiming for a single, legally binding agreement through consensus—is no longer viable. A rigid, all-or-nothing strategy anchored in legal formalism is unlikely to produce results. The State of Southeast Asia 2025 Survey illustrates this scepticism: 13.4 per cent of respondents believe the COC will not materialise because China will never relinquish its claims, and 14.4 per cent believe that the COC would serve only as a tension management tool and not a dispute resolution mechanism (Figure 3).

Fundamentally, the COC is constrained not just by diplomatic gridlock, but by deeper structural realities such as legal fragmentation and clashing strategic visions. Unless ASEAN and China are willing to rethink the COC’s purpose, structure and implementation model, it will remain a stalled process—more symbolic than substantive.

RETHINKING ASEAN’S APPROACH TO THE COC

Given the persistent and fundamental challenges, it has become increasingly clear that ASEAN cannot afford to persist with its current strategy of achieving a comprehensive and legally binding agreement through consensus. A fundamental rethink of ASEAN’s negotiating posture is urgently needed if the grouping is to salvage credibility and exert meaningful influence over the evolving maritime dynamics in the South China Sea. A legally binding but unenforceable document would be futile. As such, ASEAN should consider a more flexible, creative and realistic set of approaches.

A legally binding but unenforceable document would be futile. As such, ASEAN should consider a more flexible, creative and realistic set of approaches.

The COC as Political Instrument and Not Legal Treaty

Given the structural deadlock and legal divergence, ASEAN and China should consider recalibrating their expectations of what the COC can realistically achieve. Rather than continue the pursuance of a fully legally binding treaty, attention could shift towards concluding a more robust political agreement as a formal negotiated outcome. A political COC would go beyond the 2002 Declaration on the Conduct of Parties (DOC) by including clearer, more specific commitments on self-restraint, dispute management and maritime cooperation.

While some of these elements—such as discouraging new land reclamation or military construction—already appear in the draft COC, their political framing as voluntary behavioural norms rather than enforceable rules could lower threat perceptions and increase buy-in. The emphasis would be on encouraging restraint and reducing miscalculation through shared understandings, supported by clearer definitions of key terms such as “disputed features” and “incidents,” thus narrowing space for ambiguity and manipulation.

Although a political COC would lack formal enforcement mechanisms, it could nonetheless carry significant diplomatic weight. It would function as a normative reference point for regional behaviour and signal shared expectations for peaceful conduct and de-escalation. Crucially, it would avoid codifying contested legal standards, especially where China’s “historic rights” claims diverge from UNCLOS. When the 11 parties are unable to agree on legal definitions, a political COC, anchored in mutual commitments and backed by regular ASEAN-China consultations, reporting, and institutionalised confidence-building measures (CBM), may be the most achievable outcome. (Table 1)

Towards a “DOC 2.0” with Embedded CBMs

ASEAN may also consider revitalising the 2002 DOC as an interim mechanism. A “DOC 2.0” could build on the original document by incorporating institutionalised confidence-building measures (CBMs).

These CBMs could include real-time communication hotlines between naval and coast guard forces, and advance notification of military exercises, joint capacity-building programmes for marine environmental protection and search-and-rescue operations, among others. By integrating CBMs directly into the DOC framework, ASEAN and China could create a structured mechanism to reduce miscalculation, enhance transparency and prevent incidents at sea. This would not only demonstrate ASEAN’s continued commitment to preventive diplomacy and regional stability but also reinforce its ability to act amid deadlock negotiations.

While DOC 2.0 would, like its predecessor, remain an interim political declaration, it would be far more actionable and forward-leaning. However, unlike a political COC, which could mark the formal conclusion of COC negotiations with more structured commitments, defined terms and regular consultation mechanisms, a revitalised DOC would function as a diplomatic stopgap (Table 1). It would preserve momentum, signal shared restraint and keep the negotiation process alive. In short, DOC 2.0 would help manage risks in the present while sustaining the long-term aspiration of a comprehensive agreement.

Table 1

Aspect	2002 DOC	DOC 2.0	Political COC
Legal Status	Political declaration	Political declaration (more structured)	Political agreement (negotiated outcome of COC process)
Purpose	Reaffirm general principles	Interim mechanism to manage risks and sustain momentum	Formal outcome of COC talks to stabilise behaviour
Specificity	Vague and general commitments	Clearer behavioural commitments	Detailed obligations with defined terms
Confidence-Building Measures (CBMs)	Not included	Embedded CBMs: hotlines, notifications, joint exercises	Institutionalised CBMs plus regular incident prevention mechanisms
Implementation Mechanism	None	Possible roadmap with milestones and informal consultations	Includes regular ASEAN-China consultations and reporting
Monitoring and Enforcement	Absent	Light-touch peer pressure and political signalling	Diplomatic monitoring but no legal enforcement
Diplomatic Value	Symbolic, now seen as outdated	Practical, forward-leaning response to deadlock	Higher normative weight, signals closure of negotiation
Relation to COC	Precursor	Political stopgap while COC is stalled	Intended replacement if a legally binding COC is not feasible

Modular and Phased Negotiations

ASEAN and China should consider moving away from the expectation that all issues must be resolved in a single, all-encompassing agreement. Instead, a modular or phased approach through negotiating specific issue-based arrangements may offer a more realistic path forward. This strategy would allow for incremental, confidence-building progress while avoiding deadlock over the most intractable disputes.

ASEAN and China should consider moving away from the expectation that all issues must be resolved in a single, all-encompassing agreement. Instead, a modular or phased approach through negotiating specific issue-based arrangements may offer a more realistic path forward.

Initial modules could focus on politically less sensitive areas where consensus is more attainable, such as joint search and rescue coordination, marine environmental protection, and mechanisms to prevent incidents at sea—drawing from models like the Code for Unplanned Encounters at Sea (CUES). Subsequent modules could include a moratorium on new land reclamation and militarisation of disputed features, coupled with confidence-building measures like joint aerial surveillance under joint ASEAN-China oversight.

This modular approach would demonstrate visible progress, reduce risks of escalation and gradually build the trust and habits of cooperation necessary for more ambitious agreements. Importantly, such progress would be diplomatically rewarding for both ASEAN and China, and reduce the reputational costs of a stalled process.

Enhancing Intra-ASEAN Coordination: Minilateral Efforts Among Claimants

A pillar for reinvigorating ASEAN lies in addressing its internal disunity. Greater pre-negotiation coordination among the four ASEAN claimant states is essential for building coherence on sensitive issues. These states could begin by aligning shared definitions (e.g., “self-restraint,” “disputed features”, etc) and common redlines on issues like external military activities or unilateral resource exploitation.

Bilateral progress, such as the Indonesia-Vietnam EEZ delimitation agreement of 2022, shows that bilateral negotiations between ASEAN claimant countries are possible. It could be a stepping stone towards more coordinated positions between the four claimant states and Indonesia (which, though not a claimant state in the SCS, has long faced pressure from China over the waters off the Natuna Islands that fall within Indonesia’s EEZ). Understanding different ASEAN claimant states’ interpretations of EEZ rights and coordinating positions among the claimants would reduce China’s ability to exploit ASEAN divisions and bolster ASEAN’s negotiating leverage. In a process where unity is strength, enhancing intra-ASEAN consensus is not optional. It is foundational.

Managing the Role of External Partners

ASEAN can consider taking a more proactive role in managing third-party involvement in the South China Sea—an issue that remains a core concern for China, and one of the reasons behind the stalling of the COC negotiations. To address this, ASEAN could consider establishing clear parameters for external engagement, including guidelines for joint military activities, resource cooperation, and maritime exercises involving non-regional actors. This would demonstrate ASEAN’s leadership in shaping the rules of regional engagement while balancing the interests of all parties.

Notably, in the State of Southeast Asia 2025 Survey, 12.9 per cent of the respondents felt that other powers should be involved in the SCS issue once ASEAN and China had reached agreement on the COC, while 18.3 per cent expect the COC to prevent other powers from conducting military activities and energy exploration with ASEAN member states in the SCS (Figure 3), underscoring the importance for ASEAN to manage external involvement on its terms. This would help ensure that external partners support, rather than undermine regional stability. It would also preserve ASEAN centrality and position ASEAN as the convenor of responsible behaviour in the Indo-Pacific.

CONCLUSION

The challenge for ASEAN is not merely to conclude a Code of Conduct, but to demonstrate that it retains the agency to shape a stable rules-based order in the South China Sea despite legal ambiguities, internal divisions and intensifying major power rivalry. As consensus on a binding framework remains elusive, ASEAN must pivot towards a more pragmatic and flexible strategy—one that manages tensions, builds trust and preserves the prospect of future cooperation. Lessons from other contested maritime regions, such as the Baltic Sea, suggest that political will, functional cooperation and institutional dialogue can sustain stability even before full legal resolution is reached. For ASEAN, success lies not in delivering a perfect legal instrument but in sustaining diplomatic momentum and reaffirming centrality; a strong collective leadership and unshaken unity are required for the regional grouping to navigate the ever-contested maritime domain.

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This is an adapted version of ISEAS Perspective 2025/39 published on 28 May 2025. The paper and its references can be accessed at this link.