Last month in Bali, China and Association of Southeast Asian Nations countries agreed on a set of guidelines for implementing the Declaration on the Conduct of Parties in the South China Sea, signed in Phnom Penh in 2002.

Although the one-page set of guidelines hasn’t been published, it’s largely believed to be an interim process toward an eventual code of conduct in the South China Sea. There has even been talking about creating such a code later this year at the East Asia Summit.

The 2002 Declaration, Article 4, stated:

‘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, in accordance with universally recognized principles of international law, including the 1982 UN Convention on the Law of the Sea.’

The declaration made it clear that there exist ‘territorial and jurisdictional disputes’ over the South China Sea. This directly refutes any suggestions parties might make that their own claims are indisputable.

The declaration also states that parties to it shall only settle the aforementioned disputes through peaceful means – a major concession amongst China and ASEAN members. Legalistically speaking, this means that although a claimant might differ in its views over the sovereign possession of some islands/islets/reefs in the South China Sea from other claimants, they will refrain from using military means to change the status quo as of the time the declaration was agreed.

In the same vein, it could be argued that any attempt to unilaterally change the status quo of the territorial and jurisdictional rights of any part of the South China Sea would violate the declaration. For instance, if Vietnam were to develop resources in a disputed area of the South China Sea, it could be seen already to have violated the declaration not just by failing to resolve the dispute through peaceful means, but by worsening the dispute by unilateral action.

Neither the declaration nor the guidelines have resolved the dispute, but their existence has two key consequences. First, freezing the present disputes as a way of resolving differences in a peaceful way means that no claimant is able to impose its will on the others, especially through the use of force. In the short run, this will mean Vietnam and the Philippines won’t be able to use force against any Chinese presence close to their territory. More broadly, though, China won’t be able to use force against other claimants occupying part of the area as China readies to police the entire region. Second, in addition to freezing the status quo, the declaration demands that none of the parties will generate new disputes in dealing with fishing and seabed resources.

But there’s a limit to the degree of peace the declaration can provide. As disputes over sovereignty are a zero-sum game, freezing the status quo can only temporarily ensure peace, as some parties will likely feel that the declaration undermines their national interests. China, for example, in claiming the entire above-water natural properties of the South China Sea, could be most adversely affected by the exclusion of the use of force.   Vietnam could also feel aggrieved if it wasn’t entitled to its full Exclusive Economic Zone because another country already had a presence inside the area when the declaration was signed.

Meanwhile, despite the best intentions of the declaration, some parties have failed to observe it properly anyway. Failing to commit to ‘exercising self-restraint,’ they have unilaterally undertaken new efforts to search for and exploit oil in disputed waters in the South China Sea, thereby escalating inter-state tensions.

The guidelines, depending on their substance, could help make the existing declaration more executable. It’s true that the guidelines are about dispute control rather than dispute resolving. Still, the guidance should be a positive development that leads nations to collaborate more in dealing with South China Sea issues.

It should be noted that so far, whatever China’s expectations are for its historical claims over the entire South China Sea, freedom of navigation and overflight in the region hasn’t been hindered. At the end of the day, the disputes in the area are tied to resource competition. 

In negotiating a code of conduct to follow the declaration and the guidelines, it may well be worth considering prohibiting any unilateral exploration of seabed resources in disputed regions, while encouraging concerted development. This would certainly make a peaceful resolution of the conflicting claims more likely.

Shen Dingli is director of the Center for American Studies at Fudan University.