Combine sugar, fish sauce, and black pepper in a shallow plate and turn chicken in the marinade. Set aside for 10 minutes.

Combine water, fish sauce, sugar, and rice vinegar in a bowl. Set caramel sauce aside.

Heat a cast-iron skillet over medium-high heat. Add 1 tablespoon oil and pan-fry chicken, skin-side up, until bottoms turn slightly crispy and brown, about 5 minutes. Turn and cook until skin is slightly charred, about 5 minutes. Remove chicken from skillet and transfer to a plate.

Add remaining 2 tablespoons oil to the skillet and cook garlic for 30 seconds. Return chicken to the skillet and add caramel sauce. Reduce heat to a simmer and cook until chicken is no longer pink at the bone and the juices run clear. Caramel sauce should be reduced and turn amber in color. Add jalapenos and cook for 1 more minute.