VSCODE: how to open file in current window while DISPLAY is set to display of ssh server

I am ssh’ed to a server. I use a software that is triggered through the CLI and has a GUI. So I did setenv DISPLAY <$DISPLAY value of the server>. Now this software works fine.

But I also have files that I edit on vscode. So when I run code <filename>. I would expect that it will open on the VSCODE window on the client. Instead, it opens on the server.

How do I get it to open the files on the client and the GUI on the server?