I guess I will research this angle a bit historically and if anyone knows please jump in.
Coding a band around a neutral country would be easy enough, or you can try the same coordinates I frequent to see what your claims are recorded as a neutral ship after you sank her flying a Brit flag.
I often have gone into Cadiz for top up on food, toilet paper, fuel and torps and being neutral know it is a safe zone (coded) and would expect a Brit or other combative had the same courtesy.
I would also wonder - yes wonder, if the coast line had a similar safe limit under international law but only a coder could say for sure if applied to the sim! and historically there should be something written online or in a book.
There is a reason why the sim is calling my Brit merchant claims as 'neutral ships' - clearly I catch them near the neutral Spanish and Portuguese coastline ..
BTW - there is a tremendous amount of politics in the Spanish regime and while they winked at the Germans for port access, they vehemtly denied any ground forces to penetrate... hence my historical questioning on international verses coastal waters ...