Other sovereign entities such as Brunei, Malaysia, Philippines, Taiwan and Vietnam have rival claims on the waters.
Chee, Permanent Secretary for Foreign Affairs of Singapore and coordinator of China-ASEAN relations, said the draft COC framework will be submitted during the China-ASEAN Foreign Ministers' Conference to be held in the Philippines in August this year.
Southeast Asian nations with claims in the South China Sea have long wanted to sign China up to a legally binding and enforceable code.
In 2002, ASEAN member states and China agreed to a document known as the "Declaration on the Conduct of Parties in the South China Sea".
As South China Sea analysts await the public release of the framework, several questions persist about the nature of the agreement.
Duterte said if China is willing to fight so as the Philippines.
"In the face of China's open threat of war to seize Philippine EEZ in the West Philippine Sea, an area larger than the total land area of the Philippines, the President can not simply do nothing, or worse acquiesce to China's action, for inaction is the opposite of protecting Philippine EEZ", Carpio said.
The framework, the result of a crucial phase in the broader COC negotiation process, has laid a solid foundation for further negotiations, Liu said.
"This is the objective of this bilateral consultative mechanism: to discuss issues that are contentious while we proceed on the non-contentious issues in other fields that are making progress", Sta.
ISI interpreted this move as the Asian giant is "apparently beginning to build a no-fly zone in the South China Sea", Rappler quoted Kyodo News. The Philippines can not ally with China because China wants to grab for itself the West Philippine Sea and the Spratlys.
The issue has come to a head in recent years as China has pursued a strategy of building artificial islands capable of supporting military facilities in the region, provoking strong reactions from other claimants as well as the United States, which argues Beijing's actions threaten freedom of navigation and overflight through the strategically vital waters.
"Before there was a superpower underpinning ASEAN, which made it a more hard strategic calculus for China to play", says Davies. ASEAN has always been divided over the issue of the South China Sea, with some of the non-claimant states in particular (with the notable exception of Indonesia and Singapore) having expressed reservations about pushing back too hard against Beijing on the issue. China does not recognize the ruling.
Duterte claimed that he could not go to war as it will mean a massacre of Filipinos given that China has the biggest army in the world.
Despite its vague terms, however, commentators say the finalization of the Code represents a diplomatic coup for the Chinese, "demonstrating that China and its neighbors can resolve their differences just fine without Washington's help".