Let’s take for granted the view that there is no principle or rule of international law that establishes the obligation to consult or negotiate between States. Accordingly, there is no legal obligation for a state to start consultations or negotiations in order to settle a dispute because such obligation does not exist in international law.
Do you think that the above principle can be asserted in light of the provisions on consultations contained in Art 3 and 4 of the World Trade Organization (WTO) Understanding on Dispute Settlement Rules and Procedures (See O’ Connell pp 587-91) Yes/No,Why?
States A, B, and C are parties of a regional investment treaty. As you know, a treaty is an international agreement, usually in written format, between two or more states whose clauses or provisions contain legal stipulations considered as law applicable to the members of the treaty. The implementation of the investment treaty is having an impressive positive impact in the domestic economies of A, B and C.
In the Chapter on Dispute Settlement of the regional investment treaty, there is a clause that readsas follow: “if any dispute arises between the parties as to application or performance of this treaty either party agrees to submit the dispute to a final and binding arbitration before the adjudicative body created in this treaty within no more than 60 days after the dispute is established.” International Arbitration proceedings are quite expensive (i.e. arbitrators fees, legal costs of the proceedings, among others) and take a fair amount of time before the award is rendered.
By Monday, 2/4, a dispute arises between State A and C. The subject-matter of the dispute is a disagreement regarding the performance of a provision of the investment treaty. Although State C disputes the legal validity of State A’s assertion, on Tuesday, 2/5, State C asks State A, in writing, to initiate immediate and expeditious negotiations on the subject-matter in dispute.
You are the Chief of the International Law Department of the Secretary of State in country A and you are convened for a meeting scheduled for Wednesday, 2/6, with the Secretary of State and her cabinet of advisors.
On Wednesday, 2/6, you are in a meeting with the Secretary of State and her Cabinet of Advisors. The Secretary of State needs guidance on which legal step to take regarding the dispute with State C. She just finished reading, out loud, the written communication sent by State C that requests negotiations. She wants to know what your legal opinion is regarding the action that should be taken as soon as possible. What do you advise she do after considering the following four options?
a) Negotiate, but only if State B is asked to join the negotiations. Why?
b) Negotiate. Why?
c) Submit the dispute to arbitration within 60 days before the adjudicative body in accordance with the compromissory clause contained in the regional investment treaty. Why?
d) Submit the dispute to arbitration within 60 days before the adjudicative body in accordance with the compromissory clause contained in the regional investment treaty and initiate the negotiation requested by State C. Why?
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Yes, because the provisions on consultations contained in Art 3 and 4 of the World Trade Organization Understanding on Dispute Settlement Rules and Procedures declare and assert the obligation of states to consult and negotiate for the aim of settling a dispute. Both articles, especially Art 4 of the mentioned document establishes obligations of states to consult each other in matters of dispute, in way that we might think that those obligations don’t even exist as a concept in international law. In addition the procedure of consultations is thoroughly explained to the point that no other document of international law or international treaty needs to be invoked by the Member states in case of any dispute....