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International economic law and the quest for universality

  • Laurence Boisson de Chazournes (a1)

Abstract

The quest for universality in international economic law has met many obstacles. This article begins from the proposition that there are various ways to conceive of universality in international law, for example whether the rules are accepted widely among states (omnipresence) or whether they are broadly coherent (generality). Homing in on trade and investment law, the article assesses how each of these areas has functioned as a testing ground for these different conceptions. An in-built quasi-universality characterizes international trade law with the WTO as a seemingly centralized universal institution. Such universality, however, has often been achieved through differentiation of rights and obligations (e.g., the Enabling Clause and regional trade agreements). In investment law, attempts at universalization through the construction of centralized institutions have failed. Nevertheless, certain common standards have emerged in this fragmented regime. There is also a debate around the use of the MFN clause as a universalizing tool and renewed efforts to universalize investment law are afoot. More generally, it is clear that there is little appetite for codification of international economic law, and that states wish to control its content through the conclusion of treaties. In the final analysis, this article asks whether it is time to conceive of universality differently, and particularly whether equity and collective preferences should be a more central part of the quest.

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Footnotes

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The author would like to very warmly thank Jason Rudall, Researcher at the Faculty of Law of the University of Geneva, for his invaluable assistance in the preparation of this lecture given at the European Society of International Law’s Annual Conference at Manchester University on 15 September 2018.

Footnotes

References

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1 See B. Simma, ‘Universality of International Law From the Perspective of the Practitioner’, (2009) 20 European Journal of International Law 265, at 267; see also R. Jennings ‘Universal International Law in a Multicultural World’, in M. Bos and I. Brownlie (eds.), Liber Amicorum for the Rt. Hon. Lord Wilberforce (1987), 39 at 40–1.

2 Simma, ibid., at 267.

4 See A. von Bogdandy and S. Delavalle, ‘Universalism and Particularism as Paradigms of International Law’, (2008) 3 International Law and Justice Working Paper 1.

5 Tomuschat, C., ‘International Law: Ensuring the Survival of Mankind on the Eve of a New Century: General Course on Public International Law’, (1999) 281 Recueil des Cours 63.

6 See, e.g., E. Petersmann, International Economic Law in the 21st Century: Constitutional Pluralism and Multilevel Governance of Interdependent Public Goods (2012).

7 Prost, M., The Concept of Unity in Public International Law (2012), at 37.

8 See C. Redgwell, ‘Universality or Integrity? Some Reflections on Reservations to General Multilateral Treaties’, (1993) 64 British Yearbook of International Law 245.

9 Helfer, L. and Wuerth, I., ‘Customary International Law: An Instrument Choice Perspective’, (2016) 37(4) Michigan Journal of International Law 563, at 570.

10 See, e.g., J. D’Aspremont, ‘La décolonisation et le droit international de la succession’, in G. Distefano, G. Gaggioli and A. Hêche (eds.), La Convention de Vienne de 1978 sur la succession d’états en matiŁre de traités: Commentaire article par article et études thématiques (2016), vol. I, 1783, at 1790–3.

11 Byers, M., Custom, Power and the Power of Rules (1999), at 181.

12 See, e.g., The Asylum Case (Colombia v. Peru), Judgment of 20 November 1950, [1950] ICJ Rep. 6, at 266.

13 See A. Anghie, ‘The Evolution of International Law: Colonial and Postcolonial Realities’, (2006) 27 Third World Quarterly 739.

14 Declaration on the Establishment of a New International Economic Order, UN Doc. A/RES/S-6/3201 (1974).

15 Charter of Economic Rights and Duties of States, UN Doc. A/RES/29/3281 (1974).

16 Gilman, N., ‘The New International Economic Order: A Reintroduction’, (2015) 6(1) Humanity Journal 1.

17 Engle, E., ‘The Failure of the Nation State and the New International Economic Order: Multiple Converging Crises Present Opportunity to Elaborate a New Jus Gentium’, (2003) 16 St Thomas Law Review 187.

18 Venzke, I., ‘Possibilities of the Past: Histories of the NIEO and the Travails of Critique’, (2018) 20 Journal of the History of International Law 263, at 296.

19 Ibid.

20 Issues of financial and monetary law are not covered. On these issues see, e.g., S. Zamora, ‘Is There Customary International Economic Law?’, (1989) 32 German Yearbook of International Law 9, at 29–31.

21 See H. Ascensio, Droit international économique (2018), at 18–31; see also Zamora, ibid., at 40 (notably on the reasons for the paucity of customary law rules and principles in international economic law).

22 Texaco Overseas Petroleum Company / California Asiatic Oil Company v. Government of the Libyan Arab Republic (Compensation for Nationalized Property), (1978) 17(1) ILM 1, at para. 59.

23 Convention on the Jurisdictional Immunities of States and Their Property, UN Doc. A/RES/59/38 (2004), Art. 10.

24 Case Concerning The Barcelona Traction, Light and Power Company, Limited (Belgium v. Spain), Judgment of 5 February 1970, [1970] ICJ Rep. 1, at para. 33.

25 See ILC, ‘Analytical Guide to the Work of the International Law Commission – Most Favoured Nation Clause’, available at legal.un.org/ilc/guide/1_3.shtml (accessed 5 September 2018).

26 Draft Articles on Most-Favoured-Nation Clauses with Commentaries, 1978 VILC, Vol. II (Part Two), Art. 4.

27 ILC, Final Report of the Study Group on the Most-Favoured-Nation Clause, UN Doc. A/CN.4/L.852 (2015).

28 Ibid., at para. 214.

29 Ibid., at para. 215.

30 Ibid., at para. 216.

31 Shared natural resources: feasibility of future work on oil and gas, UN Doc. A/CN.4/621 (2010), at para. 15.

32 Report of the International Law Commission on its Sixty-second Session (3 May–4 June and 5 July–6 August 2010), UN Doc. A/65/10 (2010).

33 See Institut de Droit International, ‘18th Commission: Legal Aspects of Recourse to Arbitration by an Investor Against the Authorities of the Host State under Inter-State Treaties’, (2009) 73 Annuaire de l’Institut de Droit International 543; First Commission of the Institut de Droit International, ‘Corruption and Foreign Investment’, available at www.idi-iil.org/en/commissions/ (accessed 5 September 2018).

34 Ibid., at 46.

35 Ibid., at 54.

38 For the text of the Havana Charter see United Nations Conference on Trade and Employment, Final Act and Related Documents, UN Doc. E/CONF.2/78 (1948).

39 See P. Kuijper, ‘WTO Institutional Aspects’, in D. Bethlehem et al. (eds.), The Oxford Handbook of International Trade Law (2009), 80.

40 See J. Pauwelyn, ‘A Typology of Multilateral Treaty Obligations: Are WTO Obligations Bilateral or Collective in Nature?’, (2003) 14(5) European Journal of International Law 907. See also H. Ruiz-Fabri, ‘About the Sense and Direction of Multilateralism in International Trade Law’, in H. Hestermeyer et al. (eds.), Coexistence, Cooperation and Solidarity, Liber Amicorum Rüdiger Wolfrum (2012), 281.

41 See J. Jackson quoted in J. Trachtman, ‘Comments on Dani Rodrik FT Op-ed, 5 August 2018, “The WTO has become Dysfunctional”’, 6 August 2018, International Economic Law and Policy Blog, available at worldtradelaw.typepad.com/ielpblog/2018/08/trachtman-comments-on-dani-rodrik-ft-op-ed-august-5-2018-the-wto-has-become-dysfunctional.html (accessed 30 April 2019).

44 A. Fabbricotti, ‘Universalism and Regionalism in International Trade Law: Is the WTO a Truly Universal Organization?’, in Scritti in memoria di Maria Rita Saulle (2014), Vol. I, 559, at 572.

45 Ibid.; Ruiz Fabri, supra note 40, at 287.

46 WTO, ‘Understanding on the Interpretation of Article XXIV GATT of 1994’.

47 See J. Viner, The Customs Union Issue (1950), at 44.

48 See L. Boisson de Chazournes, Interactions between Regional and Universal Organizations: A Legal Perspective (2016), at 113–41.

49 WTO, ‘Special and Differential Treatment’, Ministerial Declaration of 14 November 2001.

50 WTO, ‘Monitoring Mechanism’, Ministerial Declaration of 18 December 2006.

51 WTO, ‘Trade Facilitation’, available at www.wto.org/english/tratop_e/tradfa_e/tradfa_e.htm (accessed 5 September 2018).

53 See, e.g., C. Ehlermann and L. Ehring, ‘Decision-Making in the World Trade Organization: Is the Consensus Practice of the World Trade Organization Adequate for Making, Revising and Implementing Rules on International Trade?’, (2005) 8(1) Journal of International Economic Law 51.

54 Pauwelyn, J. and Hamilton, R., ‘Exit from International Tribunals’, (2018) 9(4) Journal of International Dispute Settlement 679.

55 Resolution of the OECD Council, 12 October 1967, (1968) 7(1) ILM 117.

56 OECD Negotiating Group on the Multilateral Agreement on Investment (MAI), The Multilateral Agreement on Investment: Draft Consolidated Text, OECD Doc. DAFFE/MAI(98)7/REV1 (1998).

57 See J. Sharpe, ‘Control, Capacity and Legitimacy in Investment Treaty Arbitration’, (2018) 112 AJIL Unbound 261; J. Pauwelyn, ‘At the Edge of Chaos? Foreign Investment Law as a Complex Adaptive System. How it Emerged and How can it be Reformed?’, (2014) 29 ICSID Review 372.

58 1966 Convention on the Settlement of Investment Disputes between States and Nationals of Other States, 575 UNTS 159.

59 See A. Reinisch and A. Bjorklund, ‘Soft codification of international investment law’, in A. Bjorklund and A. Reinisch (eds.), International Investment Law and Soft Law (2012), 305, at 310.

60 Salacuse, J., ‘The Treatification of International Investment Law’, (2007) 13 Law and Business Review of the Americas 155.

61 See K. Kizer and J. Sharpe, ‘Reform of Investor-State Dispute Settlement: The US Experience’, in J. Kalicki and A. Joubin-Bret (eds.), Reshaping the Investor-State Dispute Settlement System: Journeys for the 21st Century (2015), 172, at 174.

62 Sharpe, supra note 57.

63 See M. Clodfelter, ‘The Adaptation of States to the Changing World of Investment Protection through model BITs’, (2009) 24(1) ICSID Review 165.

64 See OECD Draft Convention on the Protection of Foreign Property, supra note 56; see also A. Newcombe, ‘Developments in IIA treaty-making’, in C. Lévesque and A. de Mestral (eds.), Improving International Investment Agreements (2013), 15, at 19.

65 Schill, S., The Multilateralization of Investment Law (2009).

66 Reinisch and Bjorklund, supra note 59, at 314.

68 McRae, D., ‘Introduction to the Symposium on Simon Batifort and J. Benton Heath, “The New Debate on the Interpretation of MFN Clauses in Investment Treaties: Putting the Brakes on Multilateralization”’, (2018) 112 AJIL Unbound 38, at 42.

70 See work of the ILC and IDI discussed, supra notes 27, 33.

71 Schill, S., ‘MFN Clauses as Bilateral Commitments to Multilateralism: A Reply to Simon Batifort and J. Benton Heath’, (2017) 111(4) American Journal of International Law 914, at 925.

72 Ibid., at 922.

74 Turkey – Turkmenistan Bilateral Investment Treaty of 2 May 1992 (İçkale İnşaat Limited Şirketi v. Turkmenistan), ICSID Case No. ARB/10/24 (2010).

75 See S. Batifort and J. Heath, ‘The New Debate on the Interpretation of MFN Clauses in Investment Treaties: Putting the Brakes on Multilateralization’, (2017) 111(4) American Journal of International Law 873.

78 McRae, supra note 68, at 42.

79 Waibel, M., ‘Putting the MFN Genie back in the Bottle’, (2018) 112 American Journal of International Law 60.

80 Boisson de Chazournes, L. and Baruti, R., ‘Transparency in Investor-State Arbitration: An Incremental Approach’, (2015) 2(1) Bahrain Chamber for Dispute Resolution International Arbitration Review 59.

81 As of May 2019: Cameroon (18 June 2018), Canada (12 June 2016), Gambia (28 September 2018), Mauritius (5 June 2015), Switzerland (18 April 2017): United Nations Commission on International Trade Law, ‘Status, United Nations Convention on Transparency in Treaty-based Investor-State Arbitration (New York, 2014)’, available at www.uncitral.org/uncitral/en/uncitral_texts/arbitration/2014Transparency_Convention_status.html (accessed 28 February 2019).

82 The Convention entered into force for Gambia on 28 March 2019. It therefore also applies to the BIT that exists between Switzerland and Gambia.

83 United Nations Commission on International Trade Law, supra note 81.

84 See E. Duffy, ‘The Mauritius Convention’s Entry into Force: High Hopes with Little Impact’, 18 May 2017, Blog of the Groningen Journal of International Law, available at grojil.org/2017/05/18/the-mauritius-conventions-entry-into-force-high-hopes-with-little-impact/ (accessed 5 September 2018).

85 See J. Paulsson, ‘Universal Arbitration: What We Gain, What We Lose’, (2013) 79 Arbitration 184; I. Shihata, Towards a Greater Depoliticization of Investment Disputes: The Roles of ICSID and MIGA (1993); J. Yackee, ‘Pacta Sunt Servanda and State Promises to Foreign Investors Before Bilateral Investment Treaties: Myth and Reality’, (2009) 32 Fordham International Law Journal 1550.

86 Puig, S. and Shaffer, G., ‘Imperfect Alternatives: Institutional Choice and the Reform of Investment Law’, (2018) 112 American Journal of International Law 361, at 375.

87 See Report of the UN Commission on International Trade Law of its Fiftieth Session, UN Doc. A/72/17, at 264; A. Roberts, ‘Incremental, Systemic, and Pragmatic Reform of Investor-State Arbitration’, (2018) 112 American Journal of International Law 410.

89 See Press Release of the Council of the European Union, ‘Multilateral investment court: Council gives mandate to the Commission to open negotiations’, 20 March 2018, available at www.consilium.europa.eu/en/press/press-releases/2018/03/20/multilateral-investment-court-council-gives-mandate-to-the-commission-to-open-negotiations/ (accessed 25 February 2019).

90 See Puig and Shaffer, supra note 86; Roberts, supra note 87.

* The author would like to very warmly thank Jason Rudall, Researcher at the Faculty of Law of the University of Geneva, for his invaluable assistance in the preparation of this lecture given at the European Society of International Law’s Annual Conference at Manchester University on 15 September 2018.

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