On 23 June 2012, China’s National Offshore Oil Corporation invited bids for nine blocks of oil and gas exploration in the South China Sea. The blocks lie inside Vietnam’s declared Exclusive Economic Zone (EEZ), which prompted Vietnam’s Ministry of Foreign Affairs response of 26 June, that this area ‘is absolutely not a disputed area’. The Chinese Ministry of Foreign Affairs responded that its jurisdiction applies to this region and referred to the ‘proper settlement of maritime disputes’, thereby asserting that the area is disputed.

This controversy echoes a May 2011 incident, when Chinese marine surveillance ships cut a seismic cable being towed by a Vietnamese geological survey vessel. At the time, Vietnam asserted that the incident took place in undisputed waters, but China disagreed.

A similar controversy exists between China and the Philippines over the EEZ in the Reed Bank area, which the Philippines considers to be under its own jurisdiction, while China maintains otherwise.

So where exactly are the disputed areas in the South China Sea?

Nobody knows for sure. No claimant to the disputed islands and rocks in the South China Sea has so far declared the limits of their claims, so the boundaries of the disputed areas are unknown. This makes managing disagreements extremely difficult and increases the risk of mismatched expectations — and resulting conflict.

The 2002 Declaration of Conduct of Parties in the South China Sea between ASEAN and China is a case in point, because it does not differentiate between disputed areas and undisputed ones. If the new Code of Conduct is to overcome the limitations of its predecessor, it needs to identify disputed and undisputed areas.

Another example is China’s proposal to sidestep the disputes and pursue joint development projects. While joint development is in principle a valid approach for managing the disputes, it cannot work in practice without the claimants agreeing on the boundaries of disputed areas.

One approach to determining disputed areas is to say simply that any area claimed by two or more countries is disputed. But this would set a very low bar because it would allow any country to make any area a disputed one by making a conflicting claim there. China could declare that its U-shaped line represents a boundary for maritime space, making the whole area inside it disputed. The Philippines could do the same with a C-shaped line and Vietnam could use a D-shaped one. This would make it impossible to contain or manage disputes between the claimants.

Instead, the definition of ‘disputed area’ should be based on the United Nations Convention on the Law of the Sea, or UNCLOS, which regulates specific maritime zones. This convention is based on the principle that economic zones must be drawn with reference to land and insular territories.

It is clear that the 12-nautical-mile territorial sea around the islands and rocks of the Scarborough Shoal and the Paracel and Spratly Islands are disputed. Beyond this, the picture becomes more complicated, though opinion seems to be arranged in a clear spectrum.

At one end of the spectrum is the view that none of the disputed rocks or islands deserves an EEZ or continental shelf. This would mean that the disputed areas are confined exclusively to the 12-nautical-mile territorial sea generated from valid baselines and base points around these features.

At the other end of the spectrum is the counterfactual hypothesis that every feature in the Paracels, Spratlys and Scarborough Shoal is an island entitled to an EEZ and deserves full effect in EEZ delimitation. Under this hypothesis the boundaries would be equidistant lines between uncontested territories and the closest features of these three groups.

In reality, not every one of these outermost features is entitled to an EEZ and even those that are so not deserve full effect in EEZ delimitation.  This is because in areas where overlaps occur the international law of maritime delineation gives priority to the EEZs of larger landmasses. Therefore, in areas of overlapping entitlements, the EEZs of outlying features of the Paracels, Spratlys and Scarborough Shoal would fall short of the equidistance lines.

A criterion for drawing boundaries for disputed areas that is consistent with international law would be closer to the views near the first end of the spectrum. This solution may still give rise to disputes as to exactly where the boundaries lie, but adopting UNCLOS would allow the interested parties to negotiate to a specific standard, or submit the question to an international court.

Agreeing on boundaries for the disputed areas is the necessary basis for adopting effective dispute management measures. Boundaries that limit potential claims are consistent with international law and would also keep disputed areas small. Agreeing on how to define a disputed area would thus significantly improve the likelihood that claimants will agree on dispute resolution measures for the South China Sea.

Huy Duong is a UK-based IT consultant and commentator on maritime affairs.

A version of this article was first published here as RSIS Commentary No 123/2012.